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Business & Finance

Kaifa Group keen to invest in Pakistan’s mobile manufacturing sector

  • Back in June, the cabinet approved the country’s first-ever mobile device manufacturing policy.
05 Jan 2021

Kaifa Group of Companies, one of the world's leading manufacturers in electronics products has expressed interest to invest in the mobile manufacturing sector of Pakistan.

The development comes against the backdrop of the new Mobile Manufacturing Policy introduced by the Government of Pakistan, as the company approached the Board of Investment (BOI), to express their intention.

Back in June, the cabinet approved the country’s first-ever mobile device manufacturing policy.

As per details, the policy has been prepared with objectives of technology acquisition and localization of mobile devices through local investment, Joint Ventures, Foreign Direct Investment etc, creation of 200,000 direct and indirect jobs, price reduction for consumers, increase in digitization through supporting 4G/5G technologies, development of efficient manufacturing eco-system, exports of competitively manufactured handsets and achievement of security objectives.

The major recommendations of the policy are as follows: (i) removal of Regulatory Duty for CKD/SKD manufacturing by PTA for approved manufactures under Input/Output Co-Efficient Organisation (IOCO) approved quota;(ii) removal of fixed income tax on CKD/SKD manufacturing of mobile devices up to $ 350 category;(iii) increase in fixed income tax on $ 351-500 category by Rs 2000 and $ 500 by Rs 6300 on CKD/SKD manufacturing; (iv) removal of fixed sales tax on CKD/SKD manufacturing of mobile devices;(v) PTA activation may be restricted to locally manufactured handsets imported formally as CKD/SKD kit (8517.1211) under IOCO quota and not under HS Code 8517.7000,ie, parts; (vi) in up to $ 30 category, words “except smart phones" to be inserted for CBU imports under 8517.1219 to avoid misdeclaration; (vii) R&D allowance of 3% to be given to local manufacturers for exports of mobile phones;(viii) mobile phones to be added to Appendix-C of Import Policy Order2016 to restrict their commercial import in used condition; (ix) Government to commit to ensure maintaining tariff differential between CBU and CKD/SKD; (x) local industry to ensure localization of parts and components as per roadmap; (xi) EDB to act as Secretariat of Mobile Phone Manufacturing Policy and ensure development of allied parts, components and devices.