Pakistan Faces $1.8 Billion GDP Loss Due to Unsold Spectrum in Upcoming Auction, GSMA Warns

The upcoming spectrum auction in Pakistan could result in significant economic losses, with a projected $1.8 billion (Rs 500 billion) loss in GDP between 2025 and 2030 if there is a two-year delay in releasing the spectrum. This figure could rise to $4.3 billion (Rs 1,168 billion) in the case of a five-year delay, according to a report by the Global System for Mobile Communications Association (GSMA).

Past auctions in Pakistan have seen unsold spectrum due to excessive reserve prices, slowing down the rollout and adoption of 4G networks. The GSMA report highlighted that Pakistan has one of the lowest amounts of assigned mobile spectrum in the Asia Pacific region, with operators facing rising spectrum costs as a proportion of revenue. The government has been urged to adopt a more sustainable pricing strategy to prevent further delays in network development.

Pakistan’s telecommunications sector is facing significant challenges, including high inflation, currency depreciation, and rising energy costs, which have increased operating expenses and negatively impacted consumer spending. The GSMA report emphasized that excessive spectrum pricing could further strain the industry, causing slower mobile data speeds, poorer coverage, and delayed 5G rollout.

The upcoming auction, scheduled for early 2025, will offer nearly 600 MHz of spectrum in key bands, including 700 MHz, 1800 MHz, 2.1 GHz, 2.3 GHz, 2.6 GHz, and 3.5 GHz. The GSMA has recommended more conservative reserve pricing, denominating fees in local currency, and offering payment flexibility to ensure the spectrum is fully assigned and supports the growth of Pakistan’s digital economy.

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