Workers in peril as phone makers in Pakistan shut down operations

The mobile phone industry in the country is facing a major setback as most of the assembly units have been forced to shut down due to a shortage of raw materials and put the future of thousands of workers at stake.

Even foreign brands operating in the country have been affected by this crisis, making it a pressing concern for the government and the industry as a whole.

Many companies have had to pay their employees half of their April salaries in advance and send them home until production resumes.

Expressing his disappointment, a phone manufacturer with three production units attributed the closure of the facilities to the “incompetent and strange policies” of the finance ministry.

In a recent letter to the IT ministry, the Pakistan Mobile Phone Manufacturers Association (PMPMA) highlighted that local mobile supply has almost stopped, and markets have started to experience a shortage of mobile phones. The association’s chairman, Haji Abdul Rehman, pointed out that consumers are now forced to pay significantly higher prices for locally manufactured mobile sets.

Mr Rehman also raised concerns that the price of low-cost imported phones and locally assembled units is getting closer, which could eventually harm the sales of local sets. The situation is not only a concern for the manufacturers but also for the consumers, as they may have to bear the brunt of the rising costs and a potential shortage of mobile phones.

Despite the challenges, Pakistan has been producing over 2.5m phones per month on average since April last year, meeting around 90% of the total demand. The industry has even exported locally manufactured phones, which is an encouraging sign for the entire sector, according to Muzzaffar Hayat Piracha, CEO of Air Link Communication Ltd, one of the country’s largest smartphones distributors, manufacturers, and retailers.

However, Mr Piracha added that the production line and sales mechanism must be streamlined before the industry can move forward with plans to localize accessories such as chargers, batteries, earphones, and cables. Unfortunately, these plans have been put on hold due to the current situation. He expressed his worries about the future of the basic industry and the need to address the current issues faced by the sector.