The GSMA is a global organisation unifying the mobileecosystem to discover, develop and deliver innovationfoundational to positive business environments and societalchange. Our vision is to unlock the full power of connectivityso that people, industry and society thrive. Representingmobile operators and organisations across the mobileecosystem and adjacent industries, the GSMA delivers for itsmembers across three broad pillars: Connectivity for Good,Industry Services and Solutions, and Outreach. This activityincludes advancing policy, tackling today’s biggest societalchallenges, underpinning the technology and interoperabilitythat make mobile work, and providing the world’s largestplatform to convene the mobile ecosystem at the MWC andM360 series of events. We invite you to find out more atgsma.com Authors Jeanette Whyte, Head of Public Policy and External Affairs,APAC, GSMA Saira Faisal Syed, Country Lead Digital Transformation, Pakistan,GSMA Unlocking Pakistan’s Digital Potential:Reform, Trust, and Opportunity Pakistan has the talent. It has the ambition. It even has the vision—through the “DigitalPakistan” initiative—to become a thriving digital economy. But without urgent reforms to itstelecoms policy, the country risks falling further behind its regional peers. And it’s not justinvestors who will walk away. It’s the people of Pakistan who will pay the price. The Cost of Falling Behind In 2024, mobile technologies and services contributed$950 billionto the Asia Pacificeconomy, accounting for5.6% of GDP. This is projected to reach$1.4 trillionor6.6% ofGDPby 2030, driven by the expansion of 5G, IoT, and AI1. Yet Pakistan is not on track to fully benefit from this growth. Only29%of the population inPakistan used mobile internet in 2024, despite68% smartphone adoptionandcoveragereaching 81%. Theusage gap—the share of people who live within coverage but are notusing mobile internet—stands at52%(based on total population)2, one of the highest in theregion. This reflects persistent barriers such as affordability, digital literacy, and trust. The 5G Dilemma: Falling Behind the Region Across Asia Pacific, countries are accelerating their 5G rollouts to power smart cities, digitalindustries, and inclusive growth. Vietnam, for example, successfully completed its 5Gspectrum auctions in 2024, assigned 300 MHz in key bands, and introduced fiscal incentivesto support base station deployment. In contrast, Pakistan’s 5G rollout remains stalled. The country has one of the lowest levels ofassigned IMT spectrum in the region. A 5G multiband auction was planned for 2025 but hasbeen delayed due to merger and licensing issues. 5G is not just about faster speeds—it’s about enabling real-time services, industrialautomation, and digital inclusion. Pakistan must act now to avoid being left behind. Spectrum Reform: The Cornerstone of Connectivity Spectrum pricing and availability are critical to unlocking Pakistan’s digital future. A GSMAstudy shows that spectrum cost-to-revenue ratios in Asia Pacific rose from 3% in 2014 to 9%in 2023. Every 10-percentage point increase in spectrum cost is associated with a 6-pointdrop in coverage and 8-point drop in speeds. To reverse this trend, Pakistan must: •Price spectrum for growth, not short-term revenue.•Use local currencyto reduce financial risk.•Release more spectrum, especially mid-band, for 5G readiness.•Enable sharing and tradingto improve efficiency.•Publish a national roadmapto guide long-term investment. Fiscal Reform: Aligning Policy with Digital Ambitions To truly unlock Pakistan’s digital potential, fiscal policy must be aligned with the country’sdigital development goals. Telecom operators face one of the highest tax burdens in theregion, with combined tax rate on the use of mobile services reaching 33%, which stiflesinvestment and raises costs for consumers. This includes the sales tax of 18% and a 15% ofadvance tax on recharge — making digital access costlier for users and discouraging privateinvestment in infrastructure. Currently, devices such as smartphones are subject to combined customs duties and taxesof up to 40%, while mobile broadband services face multiple layers of taxation, furtherwidening the digital divide. Reducing sector-specific taxes and rationalising duties ondevices and services can make connectivity more affordable and accelerate adoption.Targeted fiscal incentives—such as tax credits for infrastructure investment or R&D—canfurther catalyse innovation and growth. A forward-looking fiscal framework will not only attract investment but also ensure that digitaltransformation benefits all segments of society. The API Economy and GSMA Open Gateway Pakistan’s developers and startups stand to benefit from the API economy—where telcosexpose network capabilities to build new services. TheGSMA Open Gatewayinitiative nowincludes 48 API’s published in CAMARA with another 56 in development. Pakistan is one of12 Asia Pacific markets participatin