The federal government has decided to impose penalties on mobile and electronics device manufacturing companies that fail to achieve prescribed localisation levels within the stipulated time frame under the proposed Mobile and Electronics Device Manufacturing Policy 2026 to 33. The decision reflects a stricter enforcement approach aimed at accelerating domestic manufacturing, increasing value addition, and strengthening Pakistan’s industrial base. Companies that do not meet localisation benchmarks will face withdrawal of existing concessions along with regulatory and financial consequences.
Under the proposed policy framework, manufacturers failing to comply with localisation requirements will lose all exempted or concessionary duties and will be subjected to normal tariff rates. In addition, such companies may face restrictions related to import licensing, limiting their ability to bring in components or finished products. Monetary penalties will also be imposed in the form of a surcharge equivalent to one percent of the total annual import value of the company, in addition to any other financial liabilities defined under prevailing laws and regulations. The government has also outlined incentives for compliant manufacturers, including a targeted rebate of Rs103 billion on mobile phone exports. This will be provided through a fixed and non discretionary research and development allowance of eight percent, calculated on the basis of verifiable free on board value of mobile devices exported from Pakistan.
The policy introduces several structural changes aimed at reshaping the mobile manufacturing ecosystem. Manufacturing of 2G handsets is proposed to be banned, with PTA set to restrict the activation of type allocation codes associated with the production of such devices. PTA will also limit the registration of mobile phones that are five years old, further tightening controls on older and outdated devices. In addition, the government plans to impose a ban on the import of used mobile phones to encourage domestic manufacturing and reduce dependence on second hand imports. These measures are intended to shift market demand toward locally manufactured devices and improve overall quality standards within the industry.
Progress and implementation aspects of the policy were reviewed during a meeting chaired by Special Assistant to the Prime Minister on Industries and Production Haroon Akhtar Khan. Addressing participants, he stated that the primary objective of the policy is to create employment opportunities at the local level while reinforcing Pakistan’s industrial capacity. He emphasized that phased localisation would be adopted to attract foreign investment in high technology manufacturing and to ensure sustainable industrial growth. The policy places special emphasis on the local manufacturing of key components, including motherboards, printed circuit boards, electronic parts, and display components, with the aim of deepening the supply chain within the country.
Haroon Akhtar Khan reiterated that Prime Minister Shehbaz Sharif envisions transforming Pakistan into an export base for global mobile and electronics brands and integrating the country into international value chains. Representatives of mobile manufacturers informed the meeting that leading global brands such as Samsung, Xiaomi, Oppo, Vivo, Nokia, and others are expected to invest in Pakistan under the new policy framework. It was also highlighted that expansion in the mobile manufacturing sector is likely to generate positive spillover effects for other electronics industries, supporting broader industrial development.
The special assistant stated that the new policy is designed to introduce an export oriented and globally competitive industrial framework aligned with international standards. He added that strict compliance mechanisms will be enforced, with incentives withdrawn and penalties applied in cases of violations related to localisation targets and operational obligations. The government’s approach signals a stronger focus on accountability and performance, as authorities seek to balance incentives with enforcement to drive meaningful growth in Pakistan’s mobile and electronics manufacturing sector.
Follow the SPIN IDG WhatsApp Channel for updates across the Smart Pakistan Insights Network covering all of Pakistan’s technology ecosystem.
