ECONOMIC SURVEY 2025-26: Digital economy grows as IT sector posts gains

• 5G spectrum auction rakes in $510m; broadband penetration surges to 64.2pc; telecom revenues reached Rs837bn; IT & telecom sector’s export remittances climb to $3.38bn
• 161.6m mobile handsets locally manufactured due to heavy import duties

ISLAMABAD: Pakistan’s information technology and telecommunication sector marked significant expansion during the fiscal year 2025-26, driven by a $509.6 million 5G spectrum auction and a surge in broadband penetration to 64.2pc.

According to the Economic Survey 2025-26, the outgoing fiscal year saw sweeping impro­vements in accessibility and connectivity.

Cellular mobile services now cover 92pc of the population, with 3G and 4G signals reaching over 81pc of the country’s area. Broadband penetration has nearly doubled from 32.6pc in 2019.

Telecom revenues reached Rs837bn in 9MFY26, bolstered by $567 million in sector investments. The industry contributed Rs285bn to the national exchequer through taxes and duties. Total telecom subscriptions, encompassing both mobile and fixed-line services, hit 207.22m in March.

To further expand internet access, the National Assembly on Thursday approved the Pakistan Telecommunication (Reorganisation) (Amendment) Act, 2026.

The legislation permits companies to lay optic fiber cables free of cost across any government-owned land and housing societies.

This aligns with the National Fiberisation Plan, advanced by the Pakistan Telecommunication Authority and the Ministry of IT and Telecommunication, to support 5G and emerging digital services.

During the fiscal year, the PTA also approved the adoption of Wi-Fi 7 in the 6 GHz band, positioning Pakistan among the leading Asia-Pacific nations to formally adopt the next-generation technology.

The upgrade promises higher throughput and ultra-low latency for advanced applications like 8K streaming and industrial automation.

Pakistan also bolstered its international connectivity. The country’s network currently relies on six submarine cable systems and one terrestrial cable, providing a total installed capacity of 17.7 terabits per second. Four high-capacity submarine cables — AFRICA-1, SMW-6, 2AFRICA and the Makran Gulf Gate­­way — are planned for future integration.

Domestically, local manufacturing thrived amid heavy duties on imported handsets. Pakistan produced 161.6 million mobile handsets up to March 2026. This included 67 million smartphones, accounting for 71.6pc of total production and reflecting a rapid decline in feature phone demand as 4G services expand.

Meanwhile, information and communication technology export remittances surged 19 pc, reaching $3.38bn between July and March. The Securities and Exchange Commission of Pakistan currently registers 34,420 IT and IT-enabled services companies.

Looking ahead, the Economic Survey highlighted a strong focus on human resource development. Initiatives like the National Semiconductor HR Development Programme and the Semiconductor Chip Design Upskilling pilot project aim to position Pakistan within the global semiconductor market, projected to exceed $1tr by 2030.

Approximately 70pc of this growth is driven by rapid advancements in computing and data storage, automotive electronics, wireless connectivity, power management etc.

“Rising ICT exports, a thriving freelance workforce, and continued expansion of digital infrastructure highlight Pakistan’s growing presence in the global technology landscape,” the survey concluded.

Published in Dawn, June 12th, 2026