Despite a temporary slowdown in the production of ‘Made in Pakistan’ mobile phones, largely due to the imposition of an 18% General Sales Tax (GST), demand for these locally assembled devices is expected to rise significantly says Express Tribune. Projections estimate that demand will reach 33 million units in 2024, a substantial increase from the 22.9 million units recorded in 2023.
Market Projections and Impact of GST
According to data from the Pakistan Telecommunication Authority (PTA), and insights from Topline Research analyst Sunny Kumar, phone demand is anticipated to grow by 44% in the 2024 calendar year. Kumar noted, “Based on our current monthly run rate and the new 18% GST on all mobile phones introduced in the FY25 budget, we forecast that total mobile phone demand could reach 33 million units in 2024.” This projection reflects optimism despite the GST’s potential impact on consumer purchasing power.
| Year | Demand for Mobile Phones (in million units) | Growth (%) |
|---|---|---|
| 2023 | 22.9 | – |
| 2024 | 33 | 44 |
Locally Assembled Phones Dominate Market
Currently, ‘Made in Pakistan’ phones satisfy around 95% of the local market demand, a significant achievement attributed to the government’s policies favoring local production. Conversely, imports of branded, ready-to-use mobile phones have dwindled to only 5% of the market share.
July 2024 Assembly Figures and Impact of GST
Data from the PTA reveals that local companies assembled 1.61 million mobile phone units in July 2024, which represents a 20% decrease from the same month the previous year and a 62% drop from June 2024. This decline is mainly due to a spike in purchases in June 2024, as consumers rushed to buy phones before the GST hike took effect.
Despite the dip in July, average monthly sales over June and July 2024 were approximately 2.9 million units, surpassing the five-month average (January-May 2024) of 2.6 million units.
| Month | Units Assembled (in million) | Percentage Change from Previous Month |
|---|---|---|
| June | 4.23 | – |
| July | 1.61 | -62% |
Year-to-Date Performance and Growth Factors
In the first seven months of 2024, the cumulative number of locally assembled mobile phones reached 18.95 million units, which is 2.3 times higher compared to the same period in 2023. This surge is primarily driven by last year’s import restrictions, which encouraged local production.
When compared to the same period in 2022, there was a 27% year-on-year growth. The growth can be attributed to several factors:
- Gradual economic recovery in Pakistan
- Higher market share of locally assembled phones due to increased taxes on imported models
- Growing population and increased mobile phone penetration
| Year | January-July Sales (in million units) | Year-on-Year Growth (%) |
|---|---|---|
| 2022 | 14.93 | – |
| 2023 | 18.95 | 27% |
Breakdown of Mobile Phone Types and Leading Brands
Of the 18.95 million mobile phones assembled locally in the first seven months of 2024, 64% (approximately 12.1 million units) were smartphones, while the remaining 36% (around 6.85 million units) were 2G feature phones.
The top 10 locally assembled mobile phone brands during this period were:
| Brand | Units Assembled (in million) |
|---|---|
| Infinix | 2.76 |
| Itel | 2.12 |
| VGO Tel | 2.01 |
| Tecno | 1.96 |
| Vivo | 1.71 |
| Xiaomi | 1.70 |
| Realme | 1.15 |
| Nokia | 0.83 |
| G’Five | 0.71 |
| OPPO | 0.63 |
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