India has 4G wireless service in a handful of cities, Afghanistan has 3G nationwide, Bangladesh is rolling out a nationwide 3G network, and even Nepal has 3G in major cities. That leaves Pakistan as the only country in South Asia without a high-speed mobile network. The country’s notoriously activist supreme court is trying to force the government into holding the spectrum auction needed to launch 3G services in early 2014—but the country’s equally notorious bureaucracy looks likely to delay things.
Pakistan, with a population of 180 million and 125 million mobile subscriptions, has come close to holding the spectrum auction several times over the last five years. Each time proceedings have been delayed on a technicality.
Warn-torn Afghanistan managed to avoid such a quagmire by simply not holding an auction—it simply distributed spectrum licenses to the providers. The government argued that the economic boost from acquiring 3G was more valuable than the one-off windfall from an auction that could become marred in controversy.
Bangladesh gave a 3G license to the state-owned mobile provider, Teletalk, in 2012, and held an auction for the other mobile operators in September 2013. BTRC, Bangladesh’s telecom regulator, has been applauded for not allowing the government’s fiscal concerns to hijack the agenda and set the reserve price for the auction too high—the mistake made in India.
But the Pakistan Telecoms Authority (PTA), the regulator, has been without a chief since the last time a spectrum auction was scheduled, in 2012. Plans came to a halt when the PTA said the telecoms operators and other interested bidders had failed to submit an expression of interest in time. The mobile operators, who have been long dogged by fickle government policies and strong competition, said they were never invited to bid.
The then-chairman of the PTA lost his job over the incident. His nominated successor was challenged by the opposition parties last October, and the two other members of PTA’s committee retired at the start of this year, effectively leaving the telecoms industry in a state of anarchy. Now a public-interest case currently in the supreme court has pushed the government into some semblance of action. It finally appointed an acting chairman and new PTA members early last month to oversee the auction, and set a February 2014 deadline for holding it.
However, more delays are possible. The government has now put out an advertisement for an international consultant to help with the auction. Case lawyer Ali Raza says that’s an unnecessary delaying tactic; he argues that everything is ready to go, and that the auction needs to happen quickly to avoid special interests marring the process. The next likely stumbling block is where the money from the auction will actually go. The finance ministry wants it to flow directly into the exchequer—a windfall that was somewhat prematurely written into the 2013-14 budget, announced in June. However, by law the money is meant to go to a universal service fund, set up as part of the 1996 telecoms policy (pdf) to make sure remote areas of Pakistan get telecoms service. The wrangle over that could occupy the courts for a good while.
Annabel Symington is a journalist based in Pakistan. Follow her on @A_Symington.