IT in Pakistan: challenges and solutions
Shoulder: Pakistan has come a long way on its Information and Telecom journey over the last 70 years. The country has gone from having three percent tele-density to 73 percent
For the last two decades, Information and Communication Technologies (ICTs) have come a long way in the world and Pakistan has not lagged too far behind. Today in Pakistan, there are about 140 million telephone connections and about 48 million broadband internet subscribers, predominantly relying on 3G and 4G mobile technologies. After a somewhat delayed start in the case of mobile broadband, the numbers are rapidly increasing, catching up with countries more technologically advanced.
As a result, a number of online services are becoming available to users. Awareness related to the recent unprecedented cyber-attacks and some other cyber-crimes like for the purpose of extracting ransoms, is essential to address at every level. With ICT becoming an enabler for everything, Pakistan has yet to devise cyber security framework. Pakistan must prepare and be ready to successfully meet all future cyber threats to public and private institutions and It must ensure safe and secure use of information and communication technologies in region.
Pakistan has come a long way on its Information and Telecom journey over the last 70 years. The country has gone from having three percent tele-density to 73 percent. There is some progress in digital economy and mobile banking. The contributions of this sector to the national exchequer are significant. But, where do Pakistan’s IT and Telecom industries go from here? There are important gaps to be filled. IT and telecom technologies are changing rapidly. Entry into advance internet services, big data, and cloud computing would be good, but our vulnerability to hacking and cyber-attacks would increase.
IT and Telecom also pose dangers to our national security as well. Although the PTA has achieved some important milestones including 3G and 4G auction which was stalled for many years, enactment of Prevention of Electronic Crime Bill, Implementation Plan of Pakistan Telecom Sector Computer Emergency Response Team to cope with cyber- attacks are some very important achievements.
Pakistan should focus on a comprehensive approach and rationalisation of taxation on information and communication technologies. Any progress in this vital sector is unthinkable without the consideration of these two approaches. We must look into the ways to localise the utilisation of ICT. Pakistan ICTs are highly taxed which is hampering its growth, without ICTs Pakistan’s vision 2025 will remain a dream. It is imperative that the government should take the lead to promote ICTs in socio-economic, education and health sectors as no single action can resolve all the problems, there is a need to incorporate innovation policy development in planning and development sector and must develop policies, comprehensively.
There are important gaps to be filled. IT and telecom technologies are changing rapidly. Entry into advanced internet services, big data, and cloud computing would be good, but our vulnerability to hacking and cyber-attacks would increase
With the launch of 3G/4G technologies in 2014, the number of internet users has increased to 48 million which is about 27 percent of the population, but Pakistan is still a long way in matching up with the Asian average of 45.6 percent. Cellular phone users from 2003-2008 have increased from 2.4 million to 89.6 million. Since 2007, the telecom sector’s contribution to GDP has been increased from almost negligible to over 3 percent per year whereas, broadband subscribers has been increased to 42 million in 2017. Mobile operators paying US$ 1.2 billion in taxes each year, about 30% of total revenues, survey shows that 31.6% of a mobile’s cost is taxes, third highest level of taxation in Pakistan. Just because of this figure, we can consider high taxes on ICTs as the greatest barrier to the promotion and utilisation of ICTs at the local level such that the community is unable to pay taxes on it.
Pakistan’s present status of digital economy does not inspire confidence among businessmen and investors. Gaps need to be filled in order to compete with other regional countries in digital adaptation and usage. Digital Economy is not just a part of the economy, it is known as the full economy now. It is also called the internet economy because all financial and administrative activities are happening on the internet with the help of smartphones, computers, applications and software.
The government must be proactive and lead the way by increasing its own usage of information technology. Measures focused on enhanced adaptation of digital economy will not only result in a quantum jump in the country’s GDP but will also open up vistas of increased domestic market whilst creating more business and employment opportunities, especially for the talented youth of Pakistan. Digitalisation allows enterprises to manage their businesses cost effectively using business solutions like Enterprise Resource Management (ERM).
A digital enterprise attracts the best available human resources and talent. It also helps to attract and retain talented fresh graduates that can be used too and they will also like to work with digital tools. Automation and digitalisation allows end to end close monitoring of human resources of any enterprise which is particularly important where the customers expect immediate response to their queries and provision of error free services on competitive rates.
Pakistan’s current ranking is at 144 in World Bank’s Ease-of-Doing Business 2017 which does not inspire the confidence among overseas investors, lack of digitalisation in the country’s economy is also the main factor in the lack of foreign investment. Unfortunately, no authentic data is available regarding the size of Pakistan’s digital economy, but rough estimates place our digital economy at $ 100 million, which is pitiably small.
We should also have to be more focused on running awareness campaigns for SMEs and Private business owners, who do not believe in digitalisation of their businesses, guided by the fact that digitalisation has always brought risk free profit to the business and combat myths. Provision of tax incentives can also play a significant role in shaping the digital economy. The federal and provincial governments initially may find it difficult as it appears to be losing revenue in short term but as various studies quoted above demonstrate, any transformation to digital economy will help the economy and bridge any temporary deficits.
We should emphasise on the importance of Internet in achieving Sustainable Development Goals. The use of artificial intelligence (AI) and the internet of things (IoT) can transform economies and societies by reducing the gap between the Internet and physical world. Utilisation of internet can brought efficiency in governance and collaborative approach must be followed to reduce cyber-crime. All users should be able to control how their data is accessed, collected, used, shared and stored. They should also be able to move their data between services seamlessly. We must adopt collaborative approach for online security and it must be made easier for users, Industry and government should invest in the creation of usable tools and information to help users and to make informed decisions about privacy, rights and security.
Talented youth must be promoted and authorities must implement awareness campaigns about IT at the national level. When we look at other developing countries, they have followed the holistic approach to succeed using ICTs and have combated cyber-crimes. Government must focus on the strict legislation and policies such that the hackers and attackers, who are likely to enjoy advantages of anonymity and asymmetry must be punished and discouraged. Coordinated efforts at the national and international level will be needed to face the menace.
To discuss all this on Information and Telecommunications Journey in Pakistan: Future Directions, Sustainable Development Policy Institute (SDPI) arranged seminar and invited most experienced professionals to share their knowledge with audience. Top management of some relevant multinational corporate companies also attended this seminar and shared their expertise.
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The opinions expressed in this article are the author's own and do not necessarily reflect the viewpoint or stance of SDPI.