Pakistan gearing up for life in the digital fast lane
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Pakistan recently announced its first limited test trial of 5G had been hugely successful, reaching speeds of nearly 1.7 gigabytes per second and hinted at fast-tracking the process of rolling out the system for public use by next year.
This is a watershed moment for the future of a digital Pakistan. For an already internet-hooked citizenry, the academia and business, this portends a socio-economic transformation with the potential to leapfrog the slow development lane to life in the fast lane. But while internet access and affordability have been improving in Pakistan for some years now, and the process of digitization has been gathering pace, the country has still not found its signature ‘digital groove’ that can translate it into a digital economic powerhouse.
Pakistan has already been ranked by World Bank among the top 20 reformers of their economies and slated by Pricewaterhouse-Coopers to become the 16th largest global economy by 2050 overtaking the likes of Italy and Canada.
The key indicators to sustainable digital transformation are so far on track. The number of Internet users in Pakistan at the start of 2021 was over 61 million, an increase of 11 million (or over 21%) in 2020. It seems Pakistan converted the health crisis of the Covid year into a socio-economic advantage in the process of digitalization. At the same time, over 173 million Pakistanis own a mobile – more than 77% of the population.
The government says embracing 5G can accelerate the overall digitization process as it is now the principal driver of socio-economic transformation in the post-Covid world and the lynchpin of the Digital Pakistan Vision policy. This aims at converting Pakistan into a ‘knowledge-based economy’ by way of faster digital inclusion and timely adoption of cutting-edge technologies such as 5G.
This does not seem far-fetched. With over 100 million Pakistanis under 25 years, and an overwhelming internet adoption growth rate of over 20% on an annual basis, Pakistan aims to harness a 3-5% enhancement in GDP per capita over the next few years. Pakistan recorded an average annual GDP growth rate of more than 5% between 2014 and 2018.
Covid-19 and its impact on the economy has slowed this pace but Pakistan sees a saviour in the mobile ecosystem and its increasingly important role in GDP growth, job creation, tax generation and driving productivity gains across primary sectors such as agriculture and manufacturing.
Adnan Rehmat
Covid-19 and its impact on the economy has slowed this pace but Pakistan sees a saviour in the mobile ecosystem and its increasingly important role in GDP growth, job creation, tax generation and driving productivity gains across primary sectors such as agriculture and manufacturing. According to the World Bank, the mobile ecosystem added a staggering $16.7 billion, or 5.4% to Pakistan’s GDP in 2018.
In the post-Covid world this makes it urgent to expand on Pakistan’s digitalization drive by progressing to the next generation of infrastructure capable of supporting the digital acceleration. Hence 5G and the government’s priority to it. This is, however, easier said than done. Says GSMA, the world’s largest association of mobile operators, Pakistan is an emerging mobile economy, with digital technologies beginning to transform the way people live and work and for a growing number of Pakistanis, digital platforms have become the primary channel for accessing public and private services – a trend particularly evident in the retail, transport and banking sectors.
However, the technology performance is far from optimal. Pakistan still has a sizeable ‘coverage gap’ and lags behind peers in certain areas. For instance, mobile broadband accounts for less than five in 10 mobile connections. Pakistan also last scored 39.8 in the GSMA’s Mobile Connectivity Index, compared to an average of 45.7 for South Asia.
Policymakers are aiming for increasing access to high-quality connectivity and digital services, as well as cultivating inclusion, e-commerce and entrepreneurial spirit but Pakistan’s industrial development and the wider evolution to a knowledge-based economy characterised will only be possible through sustainable openness to trade, a fair tax regime and a supportive business environment.
While Pakistan shows ample potential and continues to invest in the enrichment of the digital ecosystem, the proposed recent regulations ostensibly aimed at curbing cybercrime but in reality targeting dissent will hurt efforts to realise key socio-economic and digital ambitions.
A key reason Pakistan is still not in the big league of digital economy is falling short on developing a critical mass on quality and consistence in technical standards at each stage of digitalization. Other impediments include clarity of vision, lack of adequate priority, inadequate support infrastructure and an inability to separate creativity and innovation from fundamental rights to free speech as drivers of social development.
Addressing these before formally rolling out 5G next year can be the difference between leapfrogging Pakistan into the digital big league or remaining an also-ran.
– Adnan Rehmat is a Pakistan-based journalist, researcher and analyst with interests in politics, media, development and science.
Twitter: @adnanrehmat1
