December 04, 2007	Tuesday	Ziqa'ad 23, 1428

ISLAMABAD, Dec 3: The caretaker government plans to restrict its role in the telecom sector, mainly to the provision of taxes and incentives while rest of the issues relating to investment will be handled by the private sector.

Official sources told Dawn on Monday that the policy focus will be to further enhance the role of private sector in the provision of telecom services.

The public sector will confine its role primarily in the direction of regulation, provision of taxes and other incentives, and creating a conducive environment for private sector.

Some of the necessary steps being considered were expansion of broadband connectivity for increasing trade, employment opportunities and exploration of possibility of cooperation with other countries, reduction in tax on telecom equipment to encourage private sector to participate in telecom sector development, strict monitoring of license obligations for developing the rural area communication networks.

Introduction of the three-party validation has been proposed by the Policy Planning Cell of the ministry of labour, manpower and overseas Pakistanis with the help of private sector to check service standards and develop a strategy to improve services, and investment in R&D for introduction of new technologies with network solutions.

R&D fund could be used for customisation of the product so as to enhance the capability of the manufacturing industry, and development of the local vendor/support industry to provide quality support products for the main industry.

The telecom sector of Pakistan has shown a sharp growth over the last few years. Currently there are over 60 million cellular subscribers. The country, however, still lags behind in many of the comparable economies in terms of fixed line density (number of fixed phones per l00 inhabitants), mobile penetration (number of mobile subscribers per 100 inhabitants) and internet usage.

Since substantial population is still devoid of telecom services, there exists an enormous potential for growth of telecom sector and employment opportunities.

The government was asked to develop and maintain a high quality telecommunication infrastructure for provision of affordable world class telecom facilities.

The IT and telecommunication sector has to go a long way to increase the tele-density and access to quality services to the subscribers.

About the Information Technology (IT), the Cell said that the IT industry, particularly software industry, has enormous potential to grow and provide remunerative employment.

The worldwide IT services market is growing at the rate of eight per cent in real terms and expected to reach over $900 billion by 2010.

Of this, about half would consist of hardware maintenance, IT management and other services. The target is to increase Pakistan’s software exports from the current level of about $50 million to $5 billion by 2010-11 and to increase IT professionals to 53,000 per year in 2010-11.

Talking about the policy areas, the cell said the for the long-term growth, Pakistan will have to rapidly develop human resources by investing in almost all of the social indicators -- population, education, health, and nutrition.

Pakistan has to stay competitive in the global economy that demands skilled manpower to adapt to the rapidly changing technologies.

Although education is a high priority area in social sector development programme, the delivery of education services is still inadequate.

It is expected that effectiveness of the service delivery will improve with the completion of the devolution programme.

Under the national IT policy, the government is reducing user cost, extending services to smaller cities and towns, reducing prices of personal computers and creating awareness of IT and internet in the general public.

“If we take into account the present trend of growth of telephone network i.e. 43 per cent, the overall additional demand is projected to be exponential. The telecom sector is facing a number of challenges which need immediate attention.”

Some of them are: low tele-density, especially in rural areas, low service standards, lack of disaster recovery, data warehouse and dearth of international call centres, lack of network security, strategy and awareness, lack of R&D in the telecom sector for indigenous production of telecom equipment. Moreover, there was a lack of coordination for sharing of experience among the telecom R&D and manufacturing companies as well as universities, and low broadband penetration and high frequency charges.

It was also stated that overall productivity of the sector is low. Moreover, software industry has not invested enough in the IT sector and the market is characterised by old technologies leading to low charge rates.

It is also important to point out that the salary structure of software professionals is low when compared to the equally qualified professionals in the competing world and therefore “brain drain” is taking place, the cell said.