Telecom sector attracts $903 million FDI in 2013-14

Telecom sector of the country remained main contributor of Foreign Direct Investment (FDI) by attracting over $903 million in 2013-14 against negative $408 million in 2012-13, Pakistan Telecommunication Authority (PTA) reveals. The country's total FDI was $2.64 billion in 2013-14 against $1.57 billion during the same period of 2012-13 where telecom sector contribution was 34 percent. The FDI in telecom sector stood at negative 25 percent in 2012-13, shows the PTA latest data.
According to the PTA officials, main reason behind the turn around in FDI was the introduction of new technology after the auction of 3G/4G licenses in the country. The number of 3G/4G subscribers reached 4.9 million after the introduction of services in May this year.
The data released by the PTA here on Monday further shows that a total of $1.8 billion investment has been reported in the telecom sector during 2013-14 against $472 million during 2012-13 showing a significant increase. This increase in investment is mainly contributed by the cellular mobile which remained at $1.79 billion during 2013-14 against $421 million in 2012-13.
The growing cellular subscribers, higher taxes and launch of 3G/4G services in the country significantly increased the contribution of telecom sector to the national exchequer which remained at over Rs 234 billion in the current calendar year against Rs 124 billion during the same period of last year.
The increase in contribution to the national exchequer is attributed to the PTA's good deposits, which comprises all its receipts including initial and annual license fee, annual radio frequency spectrum fee, annual spectrum administrative fee, Universal Service Fund (USF) and R&D Fund contributions, Access Promotion Contribution (APC) for USF, numbering charges and license application fee. The PTA's deposit was Rs 104.56 billion in 2013-14 against Rs 5.31 billion in 2012-13. The data further shows that General Sales Tax (GST) collection was Rs 51.22 billion from telecom sector in 2013-14, a decline from Rs 58.17 billion collected during the same period of 2012-13. Telecom revenues reached an all time high with Rs 465 billion in 2013-14 against Rs 439 billion in the corresponding period of 2012-13 registering an increase of over Rs 16 billion.