Unlocking Spectrum Key to Digital Pakistan

Federal Minister for IT & Telecom, Shaza Fatima Khawaja, during a recent interview with ARY News, outlined the significant progress Pakistan has made in the telecom and IT sectors over the past year. She highlighted that the government is laying a strong foundation for a more connected, inclusive, and innovative economy through a series of strategic initiatives.

Khawaja put forth several key milestones, including the addition of over 10 million new mobile subscribers in the past year, which brought the total to more than 200 million. Data consumption has soared across the nation, rising by 24–25% since last year, reflecting an increasing reliance on digital tools. Moreover, digital inclusion for women has improved significantly, with 8 million more women now online, reducing the mobile internet gender gap from 36% to 25%.

The IT export sector also witnessed robust growth, increasing by 19%, reaching $3.8 billion. This achievement, Khawaja noted, was driven by collaboration between the Special Investment Facilitation Council (SIFC), Pakistan Telecommunication Authority (PTA), Pakistan Software Houses Association (P@SHA), and Pakistan Freelancers Association (PAFLA). Over 300,000 young Pakistanis have been trained through these efforts, during the past year to participate in the global digital economy, she added.

While discussing future initiatives, Khawaja elaborated on the government’s ambitious five-year “Connect 2030” strategy, which focuses on four key pillars: expanding submarine connectivity, accelerating domestic fibre deployment, introducing a uniform Right-of-Way policy, and fast-tracking spectrum auctions.

With seven submarine cables already operational and more planned, Pakistan is enhancing its international connectivity, while domestic reforms, such as the abolition of right-of-way charges by the Capital Development Authority (CDA) are paving the way for faster fibre penetration, she maintained.

However, Pakistan remains severely spectrum starved, operating on just 274 MHz of spectrum, far below its true potential and significantly less than regional and global benchmarks. This scarcity has already begun to strain network capacity, leading to congestion, slower speeds, and a degraded user experience, particularly as data demand continues to rise sharply.

A key challenge for operators has been high reserve prices in past spectrum auctions, which have often discouraged bidders. For instance, auctions in 2014 (850 MHz, 1800 MHz) and 2021 (1800 MHz, 2.1 GHz) resulted in significant unsold spectrum.

This has limited supply for operators, contributing to a slower 4G rollout and adoption. According to GSMA Intelligence, had spectrum been fully assigned in those auctions, Pakistan could have realized additional benefits worth around $300 million (PKR 80 billion).

Industry experts stress that good auction design, where reserve prices are set at reasonable levels, helps operators better gauge market value and ensures efficient spectrum assignment, leaving more funds available for network investment.

Despite operators deploying every available technical measure to optimize existing spectrum, without timely release of additional bands, quality of service is expected to deteriorate further in the coming months impacting education, healthcare, freelancers, IT exports, and overall economic growth.

If the 2025 auction is delayed by two years, Pakistan could face GDP losses of up to USD 1.8 billion (PKR 500 billion) by 2030, potentially escalating to USD 4.3 billion (PKR 1,168 billion) with a delay of five years.

Another key factor exacerbating this challenge is that spectrum payments in Pakistan are largely USD-denominated, making them disproportionately expensive for operators amid currency fluctuations.

Pakistan is now among the costliest markets globally in terms of spectrum fees relative to operator revenues, rising from 11% in 2014 to over 23% in 2023. This highlights the urgent need for a reformed spectrum pricing policy that enables sustainable business cases and encourages maximum participation in the upcoming auctions.

The government now plans to release over 600 MHz of spectrum, a move expected to increase internet speeds by up to 2.5 times, reduce congestion, and improve network resilience for millions of users, Khawaja added.

The spotlight remains on the 2600 MHz band, considered essential for enabling 5G and bridging the spectrum gap that has long constrained Pakistan’s connectivity ambitions. It is important to commit to a transparent spectrum roadmap, which would reduce uncertainty about future spectrum availability and aid long-term network planning.

Beyond infrastructure, IT & Telecom, Shaza Fatima Khawaja underscored a landmark governance reform: all federal ministries have transitioned to e-offices, creating a fully paperless government. Real-time dashboards now track files, approvals, and notings, ensuring greater efficiency, transparency, and accountability.

While some legal hurdles remain, including those related to the 2600 MHz spectrum band, Khawaja emphasized that the momentum is undeniable. As part of its broader Digital Pakistan vision, the government is setting the stage for a digital economy that is inclusive, competitive, and ready for the future.