The recent nationwide internet slowdown in Pakistan has created widespread challenges across multiple sectors, including commerce, health, education, financial services, and public sector operations. The Telecom Operators Association (TOA) has voiced serious concerns over this crisis, appealing to Prime Minister Shehbaz Sharif for immediate intervention to resolve the issue. The ongoing disruptions are not only affecting everyday activities but also pose a significant threat to the country’s economic stability.
Impact on the Telecom Sector
The telecom sector, already struggling financially, is set to face a significant blow due to the reduced internet speed. The slowdown is expected to result in an annual revenue loss of approximately Rs. 12 billion for the sector. This reduction stems from a dramatic decrease in internet traffic, with daily traffic in the country dropping by around 6,400 terabytes. The corresponding loss to the national exchequer, due to the reduced revenue of the telecom sector, is estimated to exceed Rs. 3 billion annually. The health of the telecom sector is critical, as it forms the backbone of other industries, providing the necessary infrastructure for their operations and growth.
Impact on Freelancers
Pakistan is home to the fourth-largest freelancer community globally, contributing significantly to the country’s IT exports. The internet slowdown has had a devastating impact on this community, putting their projects at risk of termination or even leading to outright cancellations. For instance, Fiverr, one of the largest global marketplaces for freelance IT workers, has reportedly changed the status of Pakistani freelancers to “offline” on its platform. This not only jeopardizes current contracts but also risks long-term damage to Pakistan’s reputation in the global freelancing market.
Impact on Businesses and National GDP
The internet disruption is adversely affecting all sectors of the economy, from education and health to commerce, banking, and manufacturing. A recent study by Deloitte revealed that internet disruptions in a small country with a population of 40 million could negatively impact the national economy by up to USD 3 million per day. Given Pakistan’s much larger population and significant dependence on the internet for business operations, the negative impact on the national economy could be far more substantial.
Impact on the IT Industry
Pakistan has set an ambitious goal of growing its IT exports to USD 25 billion in the coming years. However, the ongoing internet issues pose a severe threat to achieving this target. Immediate corrective measures are required to restore normal internet speeds and sustain the existing IT ecosystem. The current slowdown has put not just future growth but also the current level of IT exports at risk.
Impact on the Blue-Collar Workforce
The lower middle class, particularly the blue-collar workforce such as plumbers, electricians, masons, and gardeners, heavily relies on the internet to connect with clients and secure work. The ongoing disruptions have severely hampered their ability to earn a living, putting additional financial pressure on already vulnerable segments of society.
Impact on Foreign Direct Investment (FDI)
In today’s digital age, robust communication infrastructure, particularly high-speed internet, is crucial for attracting foreign direct investment (FDI). The current state of Pakistan’s internet infrastructure could deter potential investors, who are likely to view these disruptions as a sign of underdevelopment and instability. In a globally connected world, digital highways are as crucial as physical infrastructure, and the ongoing issues are a significant deterrent to new FDI.
Urgent Call to Action
Given the severe and far-reaching consequences of the ongoing internet slowdown, the Telecom Operators Association has urged Prime Minister Shehbaz Sharif to take immediate action. The association has called for a swift identification and rectification of the technical issues causing the disruptions. Delays in resolving these issues could lead to long-lasting economic repercussions for the country. Telecom operators, in their national duty, are prepared to engage in dialogue and assist the government in finding solutions to improve the current internet situation.
The ongoing crisis serves as a reminder of the critical importance of internet infrastructure in today’s world, not just for economic growth but also for the everyday functioning of society. Immediate and coordinated efforts are essential to restore normalcy and ensure that Pakistan remains on track for economic and technological progress.
