Pakistan’s Plan to Ban Luxury Smartphones Could Benefit Local Assembly Sector

by Farhan Yousaf
Pakistan's Plan to Ban Luxury Smartphones Could Benefit Local Assembly Sector Image Name

Pakistan has doubled taxes on mobile phone CKD kits. Previously, government regulations encouraged the import of CKD kits by reducing smartphone import taxes. This led to smartphone/technology manufacturers opening up local manufacturing factories in the country, like realme, which established its assembly plant this year. This increased market activity boosted the smartphone market share from USD 240 million to USD 250 million and created many local jobs.

Pakistan to assemble more smartphones as an import ban on luxury phones kicks in; Syed Mashood Hassan

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Pakistan’s administration is adopting severe measures to combat political and economic uncertainties and rising inflation. Levies are based on the phone’s pricing band, increasing with each price increase. In addition, mobile phone sales tax has risen from PKR 10/- to 10% of the handset’s price. realme Pakistan has had a successful year with the debut of the realme 9i, 9 Pro+, and C35.

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With Pakistan’s current political and economic uncertainties and rising inflation, the government is adopting severe measures to try to correct the situation. The fees are set based on the price range of the phone, with the levy increasing with each price increase. Furthermore, the sales tax on mobile phones has increased dramatically from PKR 10/- per device to 10% of the handset’s price. realme Pakistan has had a successful year thus far, with the introduction of the realme 9 series, the realme 9i and 9 Pro+, as well as the latest cheap C series device, the realme C35.

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Costs are forcing people to leave the premium smartphone market and move down into mid-and budget-priced devices. This is a great chance for realme, as consumers who had been devoted to more expensive brands will now begin to look to realme as a viable alternative, which will help the company’s standing in the country.

In the past few months, the value of USD is frequently appreciating in comparison to the Pakistani Rupee (PKR). This has had a devastating effect on the buying power of consumers in Pakistan as goods and services are becoming more expensive without an adjustment in income to balance it out. realme is doing its best to maintain the buying power of consumers by offering alternative channels to purchase its products.

The tech democratizer has collaborated with Bank Alfalah and other offline channels in order to offer its customers the Buy Now, Pay Later (BNPL) facility which allows customers to purchase a smartphone with delayed payment. Alternatively, realme is offering increased support to its other partners that offer the facility to purchase their products on an installment basis. realme’s goal is to minimize the effect on the buying power of consumers and allow them to purchase their products at a markup of 0%.

realme’s progress in the last quarter has been on the rise, increasing 45% with respect to sales since January 2022 and garnering a great response from customers especially after the launch of the realme C35 and they plan to continue to go strong in the latter half of 2022. The brand’s focus will be on releasing three to four new smartphones with 4GB / 128GB and 6GB / 128GB specifications for its Gen-Z audience. In August this year, the incredibly exciting realme Fan Fest 2022 will be taking place. Syed Mashood hopes that it will be a fun-filled event for loving realme fans and give the skeptics who have not had an experience with the realme brand a chance to experience their products and fall in love with realme as well. Recently across the border, our neighboring country opened the world’s first realme Global Flagship Store. With realme’s trajectory of growth so far, realme Pakistan is eager to follow in their footsteps so realme fans can enjoy the ultimate realme experience.

The reduction of consumer buying power can definitely prove challenging for smartphone manufacturers in Pakistan but it is not a challenge that cannot be overcome. It is important for brands to adapt to changing situations and facilitate their consumers wherever possible. realme Pakistan will strive to continue its commitment to provide superior value to its consumers and do what it can to lift the burden off the buyers in the market.

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