ICTs: get smart

Lately, a few regulatory changes have stirred optimism in the ICT (information and communication technology) industry. Progress on ‘rolling spectrum strategy’ and resolution of ‘right of way’ challenges, along with upcoming spectrum auctions potentially before the fiscal’s close, can provide fresh impetus to the industry after a challenging year. The expansion in broadband networks and improvement in quality of service are of great importance, as witnessed during recent quarters amidst the pandemic.

The need of the hour is to resolve the basic connectivity and infrastructure limitations, so that the country can move towards realizing actual potential that ICTs have in improving quality of life in urban and rural areas. There is also a huge digital divide that needs bridging. As per the PSLM 2018-19, only 14 percent Pakistani households had access to a computer/laptop/tablet, only 45 percent of individuals (10 years and older) had possessed their own mobile phones, and only 34 percent households had internet access, as of 2019. This is at odds with PTA’s shiny 82 percent tele-density figure and 91 million 3G/4G subscribers.

There is some progress, however, that needs to be acknowledged. For instance, the ICTs are helping familiarize bottom of pyramid with digital financial services (DFS) or branchless banking (BB). Nearly 5 million DFS/BB transactions are taking place daily through 31 million+ active mobile wallets, as per latest SBP data. Compared to traditional banking, this platform is seemingly more inclusive for females and for backward regions. Digital payments have taken off and they now need to complemented with attractive savings and credit products to have a serious crack at reducing high financial exclusion in the country.

In addition, ICTs have helped grow the e-commerce sector and spread its reach into hinterlands. There is continued healthy growth in number of e-commerce merchants registered with banks, reaching 2,164 as of September 2020. Calculations based on SBP data show that close to 50,000 e-commerce transactions are taking place via these merchants every day, valuing about a million dollars per day. Since much of the market is cash-on-delivery, the actual size of e-commerce market is said to be several times that figure.

Moreover, ICTs have also honed the ingenuity of the youth. Pakistan is one of the leading and among the fastest-growing countries in the global freelancing market. This is a source of pride as well as precious forex. While social media has its downsides and the government has a love-hate relationship with the likes of Twitter, YouTube, Facebook and TikTok, many individuals have used such digital engagement platforms to flourish individually and commercially thanks to their talent, creativity and business sense.

But the above-mentioned (and other) positives were perhaps bound to occur, like a river flowing downstream, finding its own way. Fact is that Pakistan has been unable to significantly increase uptake and usage of ICTs among individuals, businesses, and within public sector. While successive governments tried, several issues linger. For instance, taxes remain high on broadband usage, digitalization continues to be resisted within government, traditional SMEs need handholding to migrate to software-based operation, and many ICT-promotion public bodies overlap and compete with each other.

Things can change for the better. A lot of untapped value resides in using ICTs to improve public service delivery. Pakistan’s urban challenges are found in areas such as public safety, water management, congestion control, waste disposal, infrastructure development, and decent education and healthcare services. A framework needs to be put in place in major cities to benefit from “smart city” applications to optimize service delivery, by using Internet of Things-based (IoT) ecosystem connecting service providers and citizens. In that regard, the government’s Digital Pakistan initiative needs to have a holistic focus.