Industrialization Revolutions resulting from technological innovations have transformed the world many folds. The first, second and third industrial revolutions focused only social living but fourth industrial revolution is there to revolutionize fundamentally our way to live, work and our relationships. This is going to intermingle our physical, geographical, digital and biological boundaries. The fourth revolution will evolve with exponential rather than linear path. There is going to be unending realm of opportunities with the use of mobile devices, unprecedented processing power, storage capacity, access to knowledge associated with technological breakthroughs in fields such as artificial intelligence, robotics, the Internet of Things, autonomous vehicles, 3-D printing, nanotechnology, biotechnology, material sciences, energy storage and quantum computing. In Pakistan rapid ICT diffusion and technology has transformed business as usual. In the early 90’s with the introduction of cellular phones there was a change in the digital landscape of Pakistan. It has led to business openings, better consumer experience access to information and communication for the people of Pakistan. The telecom industry of Pakistan is providing environment to spur sustainable economic growth in the country.
Major ICT developments in different sectors of the economy are:
Access & infrastructure
The biggest handicap in the introduction of ICT development in Pakistan was the non availability of telecom broadband services. In April 2014, 3G, 4G LTE services were auctioned and PTA implemented the government policies. After that there has been a true digital transformation through mobile broadband subscription and ICT services. The graph shows digital evolution of Pakistan. The graph depicts the enhancement in national connectivity with two more auctions in 2016 and 2017. 3G signals cover 70% of population and 4G LTE is accessible to 30% population.
The total length of 85,549 kms fiber optics with undersea links to carry the inflow and outflow of traffic. PTCL has also added another submarine cable in addition to I-ME-WE, SEA-ME-WE3 and SEA-ME-WE4 for internet connectivity has also played significant role in national and international connectivity.
Digital economy
The prerequisites of a flourishing economy are digital access and digital payment solutions. World Bank report has estimated that a 1% increase in mobile phone subscriptions will add 0.28% in GDP. Pakistan has the potential to become growing digital economy since there is 70% mobile penetration, 19.2% broadband penetration and 23% adult population. Digital economy has the power to change Pakistan’s sustainable development by creating job opportunities for youth especially for women of Pakistan.
The Government of Pakistan has set its Digital Policy Goal as “Generate sustainable innovation, entrepreneurship and employment opportunities for the nation’s rapidly growing generation of technologically sophisticated and entrepreneurial youth population”. The government has also devised policies to empower youth through training programs to enhance their employability. The government has announced National Financial Inclusion Strategy. The salient points for 2020 are as under:
- Increase the number of adults with a formal account (bank account or mobile wallet account) to 50%.
- Increase the number of female adults with a formal account to 25%.
- Increase the percentage of adults living within 5 kilometers of an access point.
- Increase the percentage of savers that have used a formal financial service to save to 10%.
State Bank of Pakistan is working on the project of digital bank which will be operated by internet while staying online through websites or mobile Apps without any physical appearance. The government (PTA & SBP) has also introduced Third Party Service Provider (TPSP) model to connect banks and operators to amalgamate their resources and provide mobile financial services. Private sector is also working for digital economy. The first Digital Saving Centre has been launched by a mutual funds company recently in Lahore. There are 100 million youth under the age of 24 and in order to provide jobs to this number economy should grow at the rate of 7%. This demands that youth should opt for business startups, incubation programs, angel Investments for self-sustained development and growth of business ideas instead of standing in ques to look for public sector job opportunities. To encourage and support digital entrepreneurship government has set up business start-ups and incubation centers and a fund National ICT R&D has also been utilized for this purpose. Rozee.pk & brightspyre.com are using internet to connect people with jobs. Mobile applications are also helping people to find jobs in Careem & Uber. On average a Careem captain is earning around Rs.60,000 to Rs.70,000 per month. Recent policies of government have encouraged credible international players to enter into ecosystem of E-Commerce. Airlift and Swvl are also providing services through mobile applications. These mobile applications and internet use has generated direct and indirect job opportunities to hundreds of thousands of people. This can also be a source of income generation for our unutilized potential of females. There are almost 77 out of 100 males employed whereas there are 22 out of 100 females employed. This is because of low female literacy rate, social and cultural taboos and traditions which impede active female participation in economic activities of Pakistan.
The Draft Digital Pakistan Policy has a specific goal that states “Ensuring that women & girls have equal access to ICTs will help reduce inequalities (Goal 10 of UN SDGs) and support gender equality (Goal 5 of UN SDGs). The value of ICTs is largely seen through increased productivity, improved access to health, education, equitable participation in social, political and economic spheres and breaking barriers of isolation”.
ICTs are helping women in business start-ups, incubation centers, freelance work and payment to women through government income support programs. Females are also very active on Facebook pages, E Commerce, food Apps and Blogs. Government under BISP 4.7 million females are getting Rs.1500 per month at their homes thus increasing the efficient management of limited resources.
E-Commerce
E-Commerce is the most important stimulating force of Digital Pakistan. Recent policies of Government of Pakistan have encouraged creditors international to enter into ecosystem of e-commerce markets of Pakistan. World’s largest E-commerce business company Alibaba has signed an MoU with Trade Development Authority of Pakistan to bring small and medium e-commerce businesses in Pakistan. In private sector e-commerce business initiatives for consumers (B2C) that have been success stories are Daraz.pk, OLX.com, homeshopping.pk. The size of the e-commerce market of Pakistan is US$60-100 million (2015) and expected to grow up to US$1 billion by 2020. Since we have cash driven economy and our credit/debit card holders are small and even m-wallet accounts are low so 95% of e-commerce business is done by Cash on Delivery system. By the end of 2020, the software industry with the use of Business to Business (B2B) aims to achieve US%5billion. IT industries of medium size are earning US$530 million, mainly in software development and service outsourcing. Pakistan’s share in global IT sales is just US$2.8 billion out of the global US$3.2 trillion global market.
Consumers are not only buying products from websites but are also using websites for cars, travelling and property etc. to experience wide range of economic activities. The auto website Pakwheels.com has emerged as the leading online car buying and selling website in Pakistan. There are 160,000 cars and 24,000 motorcycles available on this website for trade and almost 100,000 visitors daily visit this website. Zameen.com is the leading real estate database and is connecting dealers, buyers, sellers and renters. Food Panda is the leading food delivery App. Last year it has earned one billion rupees in excess of its sales for the restaurants industry. Rozee.pk is advertising plenty of nationwide vacancies and is number one job website. Daraz.pk is the largest online shopping mall. It is providing platform to many vendors and facilitating with one stop shop to consumers. The traffic on Daraz, the online retailer, is 2 million daily active users as it offers 4 million products in over 100 categories. Pakistani online stores have around 25,000 clicks a second on major electronic product releases or during an Eid or Black Friday sale. This hefty amount of online traffic is proof that e-commerce can work well in the Pakistani market. Opened through URL addresses or website links these mega stores now have a permanent presence on the internet. They are able to offer a huge catalog to users nationwide. These e-commerce platforms are able to build steady and trustworthy linkages between online warehouses and sellers.
All leading fashion brands, accessories, food, cosmetics are offering online shopping facilities to their customers. Now these websites are also providing facility of mobile and online solution for payments. These e-commerce websites have made Pakistan a lucrative market for foreign investment.
Daraz has got an investment of US$55 million from Asia Pacific Internet Group (APACIG) and Commonwealth Development Corporation Group, UK. Zameen.com has got US$29 million from Catch group and Frontier Digital Ventures. Careem has raised investment of US$60 million from Abraaj Group. Rozee.pk has raised US$6.5 million in a Series C funding round with VostokNafta and Piton Capital Lead Investment.
According to State Bank of Pakistan report, the number of registered e-commerce traders have increased by 2.6 times and e-commerce payments have been raised by 2.3 times during one year.
As per SBP’s payment System Review (Q2FY18), 2016 there were 344 e-commerce registered merchants with banks and the number climbed to 905 during 2017. The e-commerce transactions were Rs.3.9 million in the last quarter of 2016 whereas it was Rs. 4.5 billion in the last quarter of 2017.
[ads1]
Foreign investment by companies such as Telenor helped produce an economical indigenous telecommunication arrangement that has led to speedy progression in countrywide linkage connectivity. The other companies which we have are Mobilink, Ufone, PTCL, and Zong contribute for coverage in inaccessible regions of the country. Telenor established a standard for other tele corporations to progress reachable and reasonable connectivity parcels for a variety of pecuniary circumstances. The accomplishment of 2G, 3G,and 4G mobile internet during the last decade has unswervingly exaggerated the environment of e-commerce in Pakistan. Pakistan Telecommunication Authority’s data shows that as of July 2019, there are 161 million cellular subscribers, 70 million 3G/4G subscribers, and 72 million broadband subscribers and total teledensity of 76.56%.
Students desirous to undergo vocational training are much more inclined towards machine learning and data science which are now among the trending ways. This demand for computer literates has direct correlation with this reality that all homes, schools, hospitals, industries, social agencies, offices have access of laptops, desktops, tablets, or cellular devices. In developing countries on average users are making use of internets for their correspondence, memos, circulars, assignments, exams, financial statements, presentations, research reports through internet.
The people in old ages have transaction access to only nearest banks without any access to outside accounts access. Now with the advent of ATM machines and online and mobile banking, they are switching to mobile transactions. Thus this innovation and invention in transactions have not only saved physical effort but has also reduced the time to perform such transactions. The automated Teller Machine (ATM) has made cash withdrawal easier and time convenient for people of all ages. ATM machines are available throughout the country even in far flung areas of country side.
According to the Adviser on Commerce, Textile, Industry & Production and Investment, “Around 64% of Pakistan’s total population is under the age of 29 and is, thus, more open to embracing technology.” He goes on to say in the draft of the E-commerce Policy and Framework document that “Pakistan and its youth have an exciting journey ahead and the promotion and regulation of e-commerce become more significant in providing employment to around 130 million Pakistan’s youth in the upcoming 30 years.
The digitization of the economy helps protect exchanges between miniaturized scale little and medium undertakings (SMEs) conveying merchandise to the purchasers through money down. The e-commerce advertise is at present subject to national systems with administrations, for example, conveyance bicycles, for example, TCS and FedEx. They re-appropriate their electronic installment frameworks to frameworks associated with telecom systems, for example, Easy Paisa and Western Union, so as to quicken online deals.
Web based shopping has become a family unit wonder that is utilized by an enormous segment, clients need to purchase hardware, home and kitchen apparatuses, beautifications, books, garments and toiletries through online stores. Pakistanis didn’t know about elective techniques to tackle these every day issues, however, now shopping on the web has become a regular idea through significant urban areas of the nationwide. Only 15 years back the normal purchaser would go to the nearest market to buy things but now through the e-commerce model, they are currently ready to spare time and vitality in utilizing on the web stores and gateways to scan for items of their interest.
The travel sector becomes E-travel as clients can purchase tickets for transports, flights, prepare and even lease vehicles on the web. The greatest supporter of good advertising methodologies are retail organizations likewise called e-retailing, which incorporates different merchant, wholesaler, exporter and manufacturers. An e-commerce stage will have the option to make an online showroom where every one of these items are not contrarily contending with one another, rather, they cooperate to make the stage more grounded. The dependable linkages framed through an e-commerce stage can associate organizations with organizations while additionally making a consistent passage for business-to-buyer (B2C) channels.
The advertising devices accessible to developing e-commerce mindfulness are called Conversion Tools, they are the audits, item surveys, web-based social networking or sharing system stages, item proposals and highlighted video content intended to give applicable data to the buyer. Online stages, for example, Alibaba, Daraz, Shophive and Shopsy join these advertising apparatuses not to advance a particular brand or items, however, incorporates these instruments into their database to illuminate the client.
The digitization of the economy helps safeguard transactions between micro small and medium enterprises (SMEs) delivering goods to the consumers through cash on delivery. Nationwide deliveries are being undertaken through courier services. They outsource their electronic payment systems to systems connected to telecom networks such as Easy Paisa and Western Union, in order to accelerate online sales.