“The government solution to a problem is usually as bad as the problem.” This maxim by the towering 20th century economist Milton Friedman aptly encapsulates the last 15 years of policy making by democratic governments in Pakistan. Take the recent import ban by the Pakistan Muslim League-Nawaz (PML-N) government.
The pressure on the foreign exchange reserves to save the country from a default compelled the government to think of measures to choke the outflow of dollars to stabilise foreign exchange reserves. In their ingenuity, they chose to ban imports of what were termed as ‘luxurious and non-essential goods’. From frozen food to home appliances, a blanket ban was imposed on the imports of 38 different categories of products.
The solution has turned out to be as bad as the problem – one of the categories of products for which the import ban has been put into effect is mobile phones, which has sent the industry scrambling when it was just starting to take up.
In 2020, the then Pakistan Tehreek-e-Insaf (PTI) government introduced a Mobile Devices Manufacturing Policy to boost local manufacturing of mobile phones which introduced import tariff structure that incentivised local manufacturing by importing raw materials, over importing completely built mobile phones.
“Before the 2020 Mobile Devices Manufacturing Policy, manufacturing a mobile phone in Pakistan was not a viable business,” says Aamir Allawala, CEO of Techno Pack Telecom which manufactures Infinix mobiles in...
Read Full Story: https://profit.pakistantoday.com.pk/2022/06/20/squabbles-regulation-and-bans-the-state-of-pakistans-mobile-manufacturing-industry/
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