ISLAMABAD, Sept 12: Pakistan Telecommunication Authority (PTA) Chairman Dr Mohammad Yasin on Friday called for reduction in the federal excise duty (FED)/general sales tax (GST) which, he believed was one of the major reasons behind the adverse affects on the growth of telecom industry.

“The increase in excise duty/GST from 15 per cent to 21 per cent is having adverse affect on the growth of telecom sector as it has decreased the annual revenues of the operators. The government should reduce these indirect taxes for the proliferation of telecom facilities and to help foreign investors recover their costs,” Dr Yasin said.

Speaking with mediapersons here, the PTA chairman said slow growth of economy and the impact of currency depreciation on the sector were some of the reasons which had hindered its growth.

He said: “We are taking corrective measures and pursuing the government to overcome the difficulties.” The PTA chairman said the telecom sector, which attracted over $5 billion Foreign Direct Investment (FDI) in the last four years, had declined from 27 per cent in 2006-07 to 21 per cent in 2007-08 because most of the operators had already laid down their infrastructure.

In his view, the imported sets and equipment worth $1.3 billion in 2007-08 in the telecom sector were also a burden on Pakistan’s foreign exchange.

“We are convincing leading manufacturers of the world to establish their facilities in Pakistan,” he said.

Commenting on verification of mobile subscribers’ antecedents, Dr Yasin said 7.1 million unverified connections had been blocked till date. Remaining data of mobile subscribers would be verified till September 30 and unverified connections blocked.

“Due to stringent measures, monthly sale of SIMs for all cellular companies declined by 10 to 20 per cent,” he said, adding that a consumer protection cell had also been established to check fraudulent/unsolicited messages and obnoxious calls. To-date a total of 9,633 complaints had been processed since the set up of the cell.

He said an average blocking of cell phones since March 2007 was around 11,500 to 13,000 per month despite the average increase of two million cellular subscribers per month. Statistics revealed that mobile phone theft had not increased despite rapid increase in subscribers’ base.

Dr Yasin also pointed out that nearly 270,000 phones reported stolen or lost had been blocked since the IMEI blocking facility was introduced in 2006.

Broadband is the future, said Dr Mohammad Yasin as he underlined future of the telecom sector, adding that “more than 100 per cent growth of broadband was recorded last year. 3G will also increase mobile broadband services.”

“The 3G spectrum auction will be held late this year and modalities are being finalised,” he said.

The PTA was now looking at focusing on improvement of telephone services in far-off areas of the country. The chairman said: “This issue is being tackled through universal service fund (USF). However, the PTA has also initiated rural telephony projects through the Rabta Ghar Scheme aimed at proliferation of telecom facilities in the rural and far-flung unserved and underserved areas of Pakistan to bridge the digital divide between the urban and rural areas.”

“We are looking at an information revolution where information will be available to all,” the chairman said in an optimistic tone.