Massive Cost Surge Puts Pakistan’s Digital Future at Risk
ISLAMABAD – Pakistan’s telecom industry is sounding the alarm over a drastic 300% increase in the Customs valuation of fiber broadband routers (ONTs), warning that the move threatens to cripple fiber broadband expansion and derail the government’s Digital Pakistan Vision.
In a formal appeal to the Ministry of Information Technology & Telecommunications (MoITT), the Telecom Operators Association (ToA) has urged immediate action to reverse the Federal Board of Revenue’s (FBR) sudden price hike, which industry stakeholders argue is unjustified and damaging.
Massive Price Hike Sparks Industry Outrage
Under Valuation Order No. 1931/2024, Pakistan Customs has arbitrarily raised the price of ONTs with RF (cable TV) ports from $50 to $165 per unit. Meanwhile, Wi-Fi-only ONTs have jumped from $27 to $44. These specialized devices, essential for fiber-to-the-home (FTTH) networks, are used exclusively by major broadband operators like PTCL, Nayatel, Cybernet, and Transworld.
Telecom operators argue that the valuation ignores actual import invoices and fails to reflect real market prices, making broadband services significantly more expensive for consumers.
Industry’s Plea Ignored by Customs
In a letter sent on January 15, 2025, telecom companies detailed their concerns to the Directorate General of Customs Valuation, submitting official import documents, including Letters of Credit (LCs), commercial invoices, and goods declarations. They highlighted that ONTs are not available in the local market and are imported directly from global manufacturers like Huawei, ZTE, and Fiberhome at standard rates.
Despite this, Customs dismissed these submissions and imposed inflated valuations that contradict global pricing trends.
Flawed Price Calculations and Technical Misinterpretations
Further complicating the situation, Customs assigned ONT prices based on Wi-Fi generations (Wi-Fi 4, 5, 6, and 7)—an approach that makes no technical sense. Industry experts argue that Wi-Fi speeds have no correlation with RF ports, which are meant for cable TV connectivity, not internet performance.
This misinterpretation of technology has led to unrealistically high costs, further burdening broadband expansion efforts and discouraging investment in the sector.
Threat to Broadband Growth and Affordability
The telecom industry warns that this arbitrary hike will put ONTs out of reach for home users, making broadband unaffordable and stifling Pakistan’s FTTH expansion. This move is completely at odds with the government’s goal of expanding high-speed internet access nationwide.
The ToA is calling on MoITT to intervene immediately and push FBR for a fair, market-driven valuation. Industry leaders argue that MoITT, the Pakistan Telecommunication Authority (PTA), and the Pakistan Electronic Media Regulatory Authority (PEMRA) should have been included in the valuation process to ensure informed decision-making.
Telecom Industry Demands Transparency and Fair Pricing
To prevent further arbitrary pricing decisions, telecom operators propose a transparent valuation mechanism, including:
✅ Customs valuations based on actual import data from the past six months
✅ Biannual reviews to ensure fair market pricing
✅ Clear documentation of how Customs determines prices
As Pakistan works to strengthen its digital infrastructure, industry experts warn that such ill-conceived policy decisions could derail broadband growth and raise costs for businesses and consumers alike.
