Increasing call rates to Pakistan is plain cruelty

Published: October 10, 2012

This government has now become notorious for its illogical and poorly advised decisions but this increase in rates seems to be a new low. DESIGN: ERUM SHAIKH

The recent increase in the calling rates for incoming calls to Pakistan has come as a rude shock to many overseas Pakistanis for several reasons.

Firstly because there was no prior announcement of this revision in rates and secondly because the rate of increase which ranges between 300% to 800% is beyond anybody’s comprehension. It is being reported that this big increase is a result of the PTA’s decision to implement the International Clearing House (ICH) and is claimed to reduce illegal calls to Pakistan.

This government has now become notorious for its illogical and poorly advised decisions but this increase in rates seems to be a new low. To put it simply, this looks like a scam to extort money from overseas Pakistanis who have to call their loved ones regularly no matter what the cost.

According to estimates, there are almost seven million Pakistanis living abroad and monthly incoming international traffic to Pakistan is 1.5 billion minutes per month, which means overseas Pakistanis will have to pay between US $120 million to US $150 million extra to the PTA for calling their family back home. Now the government probably believes that the overseas Pakistanis are not doing enough for their country and decided to impose extra charges on them through this increase in tariff- but a small Google search reveals that Pakistan ranks amongst the top 10 countries for remittances sent home with remittance potential topping US $20 billion a year.

That number, though magnanimous in its own right, is also almost 9% of the country’s estimated nominal GDP. Considering that a majority of the Pakistanis working abroad and mostly the ones working in the Middle East do blue-collar jobs making just enough money to make ends meet, this massive increase in rates seems very harsh. Assuming that most people would still prefer to keep calling their folks back home, this increase in tariff rates would either result in the amount of remittances suffering a sharp decline or people resorting to other services such as Skype or Viber to call people back home.

Whatever the case may be, the government’s own coffers are assured to be filled up.

Let’s now move away from the plight of the overseas Pakistani for a moment and look at the economic aspect of this decision.

In these times of prolonged recession, businesses are looking to save costs wherever they can and the shared service environment has really taken off in the last few years with companies relocating aspects of their businesses to countries that offer lower rates for services than those that would be applicable in their home countries.

As a result, economies of countries like India, China and Mexico have thrived as they offer outsourcing solutions to companies at a fraction of the cost applicable in the host country. India in particular has benefited from the host of call-centres that multinational companies have set up in the country over the past few years. The reason for this is that it is far cheaper for a business to divert a call to India than to host it in the country of origin as call rates to India are one of the lowest in the world.

Also, call-centre operatives in India are available at much lower salaries than in western countries. People have long argued that Pakistan has the same potential as India to be an outsourcing location for businesses with labour rates being as low but with the decision of increasing the tariff rates for calls to Pakistan, we can rule out the possibility of any multinational relocating its shared service centre to Pakistan any time soon.

It is a request to the government of Pakistan and PTA to reconsider the increase in tariff rates and if they ascertain that an increase is in fact necessary, then to reconsider the percentage of increase in the interest of both the economic development of the country and for the benefit of the Pakistanis living abroad.

Read more by Faraz here or follow him on Twitter @eff_eche

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Faraz Hasan

Faraz Hasan

A Chartered Accountant from the Institute of Chartered Accountants of Pakistan and is currently working in the UK & Ireland division of one of the big 4 audit firms. His interests include travelling, cricket and photography. He tweets @eff_eche (twitter.com/eff_eche) and blogs at farazhasan.wordpress.com

The views expressed by the writer and the reader comments do not necessarily reflect the views and policies of The Express Tribune.

  • Jamshed

    well govt is not going to generate $120 million extra revenue .. it will just reduce the traffic and i am sure it will drop from 1.5 billion minutes to 100 million minutes .. i used to buy calling card giving me 300 minutes to Pakistan in $20 now i get hardly 40 minutes .. but i still use only one card .. just talk to family not friends and also just ask them to come online on skype :) .. Recommend

  • Ahmed

    Wow, another milestone by our famous president. God, Save PakistanRecommend

  • http://lonepkliberal.wordpress.com Loneliberal PK

    Can’t remember the last time I heard the name “PTA” and did not reflexively crush the glass in my hand. Recommend

  • Bilal

    Simply insane and quite shamelessly done! In this era of communication, imposing such high tariffs on telecommunication will just halt/reduce the incoming calls to Pakistan. Result – - > PTA’s dream will soon shatter. Another reason for this policy will be the widespread of super fast internet networks (4G, WiFi etc.) even on streets of the EU and North America. So people (Pakistanis) living abroad will not bother to buy cards anymore and would then make sure that they have internet subscription in the mobile phones/gadgets to make free (cuz it will be subscription based) calls to their loved ones back home (in Pakistan). Finally, PTA and ‘minds’ behind such policy are just not able to comprehend how tax structure across the world is evolving: not vertically (imposing higher and higher taxes on goods and services) but horizontally (marginal taxes on variety of products and services)…Recommend

  • Zeeshan

    The options I have thought of

    Get an unlimited mobile data package in Pakistan which on Ufone costs 500+tax. This will enable any user with smartphone to receive and make calls on Viber and Skype.
    When at home, Wi-fi can be used to Skype and Viber
    My mother will have problems using skype and Viber so the other option would be to get a vonage number and get it fixed in Pakistan. It works like a land line and costs around 5 pounds a month.

    If anyone can think of anything else please share.Recommend

  • Ali

    People should do outgoing calls. Tell foreign relatives to send dollars. Outgoing cost has not increased.. whats the problem then?Recommend

  • Saad Ahmed

    People will resort to other ways of communication like Viber, Facetime, Whatsapp etc. They are right in assessing that demand will be there but that demand will simply bypass PTA and find other channels. The decision is taken by a short sighted government only looking to fill up coffers before the elections.

    Overseas Pakistanis are not only sending remmitances, it is money sent by them and spent on holidays and buying property in Pakistan is what is creating many jobs back home. Also a lot of exports of Pakistan are dependant on overseas Pakistanis. Vast majority of the spices, fruits, carpets, etc are bought by overseas Pakistanis. It is high time the government realises that and give overseas Pakistani the respect and acknowledgement they deserve. Recommend

  • Syed Umair

    It’s simply a new face of Zardari Tax , I must appreciate the thinking of his intelligent team that in a recent critical financial environment of Pakistan still they are able to GET MORE ::

    PAKISTAN ZINDABAD :Recommend

  • Saranjam Khan

    I have stopped calling my friends and family. I now use skype. I used o spend 30 bucks a month but now 0. So it has reduced the traffic. What else can we expect from our government. they want to have as much of us as possible. they torture the citizens not facilitate them. Recommend

  • Qaisar jan

    Another of the Zardari taxes targeted at poor .. educated Pakistanis abroad use skype (even via phone), only labor force mainly from gulf area will be hit since they dont know other mean to call home.. Recommend

  • MonsieurCritique

    Good step taken by the government to generate revenue!Recommend

  • adnan

    well i have no problem chatting/calling through skype /messengers etc in cities where there are good internet connections .problem is when i want to talk with my parents or other people in my village as they don’t know how to use skype or viber etc and i am only getting 20 minutes for $10 which is quite expensive — my friend call me from Pakistan using
    mobilink ,its 1 Rs per minute so i guess there can be only one solution
    either your friends and family call you from Pakistan by using wateen , warid , PTCl calling cards or ufone , mobilink etc packages
    or
    if you have a internet connection you can use magic jack ,send one magic jack to pakistan and get one here ,this way your calls will be free

    any other ideas or cheap phone services from USA to Pakistan plz share Recommend

  • Umar

    For all Non Residence Pakistani’s please stop calling on Mobile or Landline, only use Skype, Gtalk, MSN, Yahoo, Viber etc. .. and i am sure if we all stop doing this in one year rates will come back to 1c .. ThinkRecommend

  • jamshed kharian-pak

    a Crime against humnity! very Backwards decision the overseas pakistanis are Bon Vache au lait product Pakistan govt mustnot act hastly they must respect peoples! since long many things are Rnning out of Pakistan Telephone is some thing very important in nowadays taxing must not be illicite! Overseas Pakistanis must use yahooMessenger Skype Viber and if necessary bycot Pakistantelecom! or use other means Callin to India China Singapur Hongkong Philiippines Korea Japan is very cheap why what happen to our country kea Pakistan govt Arshan toun dighihai!Recommend

  • Dante

    Now I only call back home to ask my parents to come online on skype. I would still prefer the phone as it’s more convenient and quicker.Recommend

  • Rahim ALi

    More tax on thr way .. to stop us (overseas pakistani) to do anything in our home land … i so want to invest in pakistani but bcoz of security .. i cant do any thing … u make less money and pay more bills + batta … skype and viber is not like phone … in emerngency you wont tell ur love one to come on skype .. u’ll just make a call to them … and same in business … i hope this PTA tax stop soonRecommend

  • RANA EHTASHAM UL HASSAN

    …..definitly a nefarious plot……
    kudos to consipiracies theories- shrouded in cloak of mysterious wisdom- always come in handy to explain such ludicrous decisions of our beloved goverment….. such theories, though begets madness but always a method always comes along with it… two such theories related to this decision are:

    heavy taxation on international incoming calls will promote grey trafficing…. bread and alot of butter for our all ‘powerful’ fed interior minister
    it will add to profit of PTCL, a public limited company but administratively run by Arabs of Etisalat to which our president enjoys wram relationsRecommend

  • Muhammad Danish

    Does any one know that whether government is taking any action or not? it is very important to emphasize on that, we can’t wait for their annualy statistics output to review the rates. Recommend

  • nas

    welcome to pakistan bhiRecommend

  • http://tribune.com p r sharma

    Due to price sensitivity demand falls particularly in developing world. Govt won’t be able to generate much additional revenue. Rather reduction in tariff will increase in volumes and resultant more revenue as well as better services to users. World wide tariffs are on declining trend.
    Govt will probable review the tariff after some time say six months to compare the revenue data for the said period .Recommend

  • Mm

    Thank you for writing about this as it has affected myself and practically every Pakistani who lives abroad.
    Even though options of Skype and Viber are available but not feasible all the time as elderly people and remote areas do not have access to internet or do not own a smart phone.
    I hope government will pay quick attention towards it as this decision has converted a simple pleasure of calling back home and being able to talk to loved ones into a hassled task. Recommend

  • hanan

    just MQM reverse this tax.
    So we all to support MQM BABAR GHAURI.
    MQM WALK OUT FROM SANIT.Recommend

  • Muhammad Ehsan Elahi
  • Rahim

    Magic Jack is the best solution for people having relatives/friends in US. Now they have an Android/Iphone application too. Just download Magic Jack app on your Android/Iphone in Pakistan and make unlimited calls to US/Canada without paying a single dollar. No subscription or Annual fees required. You just have to have Data plan or wifi :)
    I wish I could suggest any thing for Middle East/Europe dudes but am not sure!
    Search for cheaper options and avoid unnecessary calls to Pakistan. If PTA gets a revenue decline due to this price hike, they will automatically lower down the price to normal.Recommend

  • hanan

    Nothing happend yetRecommend

  • zahid

    ptcl will be going to liquadation soon.
    stop talk on the phone everyone!!!!!!!!!!!!!!!!Recommend

  • Sajjad

    Only way is if tey call from pakistan , Well what I suggest is to buy a card to call Pakistan for just telling them ti call you back and then use ezetop.com to send balance in Pakistan any mobile and tell then to call you so it cost very less as many of our friends and family don’t like to call us coz they loses ther phone cradit . All of Pakistani cellular companies have bundle / packages to call cheap abroad cost almost 1 Rs per minute.Recommend

  • jahanzeb

    we r expected our government for this act because the commission mafia have deep eyes on our pocket .Recommend

  • sadeeq muhammad

    sorry bhai.the pakistani politicions bring pakistan in first position in poor countries.an every field they want taxes..ya allah pakistan ko bachao.no more.. Recommend

  • mrs ali

    wow what a reason of increase rates ..shame on our government ..

    welll for those of my pakistani bro’s and sis’s who lives in north america i refer u ” magic jack plus” it is a small device of few dollars at my home n one i send to my parents in pakistan .internet is necessary for this and no monthly charge just pay yearly 50$ ( fifty) and thts it ..my parents call me from magic jack to majic jack free ..and all free calls to north america..

    i m using ths device since 3 yrs and no pb at all ..belive me it is very easy plz dont waste ur money just search on internet get reviews for ths device n if ur heart accept thn do try ths

    thnx 2 all Recommend

  • morf

    We need a pakistani ‘arab spring’… :-)Recommend

  • http://www.stuffad.com sheraz
  • AHMER ALI

    @LonelibeWE AL MUST BOYCOTT OUR GOVERNMENT AND PTA WE SHOULD TRY TO USE INTERNET AND BOYCOTT PTA PTCL

    : Recommend

  • Khizar

    Please anyone suggest the alternate way to call Pakistan from UAE, these calling cards are costing very expensive.Recommend

  • http://www.stuffad.cmo sheraz
  • Ali Fahd

    This is a direct attack to the people of Pakistan. PTA must revise their judgement or else the people of Pakistan have had enough of these political mosquitoes will continue to drain juice out of innocents. Wake up Dead Nation. Raise your Voice.. Make a Difference!!!Recommend

  • http://farazhasan.wordpress.com Faraz H

    Just read this:
    http://tribune.com.pk/story/456765/move-to-tax-overseas-calls-halted-by-lhc/

    A welcome decision by the LHC and hope this will reverse the call charges back to normal now.Recommend

  • safdar

    I only say that the present gourment what decided to more earn from oversease like labour catagory is totaly wrong, which dicisions made us heart, I am requesting to consider above decision, although the Indian gourment is not taken an action for thier oversease it mean it is not illigal comunication, then how can say that this can be illigal for Pakistan.
    Once again I am requesting Please do the need full.
    thanks Recommend

  • jawed

    I heard about magic jack and now thinking to buy it .Recommend

  • nazir

    bullshit of this stupid government….. Recommend

  • Muhammad Shafiq

    I am very scare about Pakistan because of this govt,all decision of the present govt are,was,and will wrong nobody think about Pakistan or Pakistani people but they think about them selves and their party,I am not speak with my child from when PTA increase calling rates because i can not afford
    Pakistan ZindabadRecommend

  • david

    crooks are in-charge of our government and our political set up… democracy is the biggest curse that Pakistan ever had!!!! Lets get rid of it and give all the politicians a one-way ticket to the moon!!!! Recommend

  • http://lucky Mohammad Refiq

    @Muhammad Shafiq:
    What do you think Pakistan is doing you a favor to incress the fees for oversea calling which is tottoly wrong because the President of Pakistan is putiing all the money in his pocket you think he is giving the money to Pakistan government there is nowayRecommend

  • Sahar

    When i heard this news so never contact easily to my family only saying salm and how are you. this totaly disturbing overseas pakistani and who ever call to pakistan.Recommend

  • Ali London

    I live in London and I can’t afford these expensive call to my family (in one pound you talk only 2 minute) I am seriously thinking to bring all of my family to here and will never go back directly govt is responsible they don’t want people connect with their family aur waise Bhi Pakistan ab choron dokon kA mulk ra Gaya hai, I suggest all oversees bring their families to other countries from Pakistan and will never go back to hell(no check & balance , no law & order ) jo jitna bara chor hai woh itna hi bara wazeer hai aur ppp is worse party in 64 history they are responsible for this all hell system Recommend

  • Sajjad

    I heard that there is a hearing on 5th of November regarding this issue . !?Recommend

  • mrs ali

    @jawed:
    ys but “magic jack plus” kit very affordable i m using one here at my home n one at my parents home in pak…no monthly charges just pay annualy 50 bucks …n free call frm magic jack to majic jackRecommend

  • shakeel aman

    we canot take our fmaliy plz help usRecommend

  • shakeel aman

    I am very scare about Pakistan because of this govt,all decision of the present govt are,was,and will wrong nobody think about Pakistan or Pakistani people but they think about them selves and their party,I am not speak with my child from when PTA increase calling rates because i can not afford
    Pakistan ZindabadRecommend

  • Hussain

    @Sajjad:
    Dear sajjad today is 5 november do you know it will reduce the prices.Recommend

  • Hussain

    when they will be decreases the prices,Recommend

  • http://www.kubanvoip.ru ayyaz

    @Hussain:
    You can still call for 0.03 usd/min to pakistan landline and mobile using this comtube . call quality is intermediate. http://www.comtube.com/?agent_id=200592cd504ebe8610f352d30e94cd54Recommend

  • salman alam

    Mostly pakistani people work in other country like uae I am also in uae before this time only 32darham. I buy 650 min to pakistan and now only 90 min so may ALLAH help my sweet country Recommend

  • http://www.stuffad.cmo sheraz

    Its 3 month package. and Its Cost is 150 riyal. i will give you a number and you will recive calls on that number. that call charges will be1 rupes and with package 65 pesa.Recommend

  • Jehangir

    After this decision taken by the Govt of Pakistan i never contact easily to my family members just only saying salm and how are you. I think this decision taken is totally disturb overseas Pakistani specially the foreigners of the Middle East countries because majority of them are belong to labor side. The educated people can use Skype etc easily to contact with their families with minimum just internet charges, but the uneducated Pakistanis cant use internet and on the other hand their earnings are not so sufficient that they contact to their families with Mobile phone or other source. Therefore i think it is not a good decision and we request the Govt Of Pakistan to reconsider about this decision. Pakistan Zinda Bad and miss lovely Pakistan a lot.Recommend

  • rana

    hi,

    i heard the same thing that on 5th there was some decision to be made.

    any updates?
    or even if anyone knows any ILLEGAL means of calling pakistan from middle east, please share…..coz now we have no other optionsRecommend

  • QAMAR

    go to hell all pakistani politicians coz they dont care about poor peoples only they care about own bank balence Recommend

  • Wajahat

    Lahore High Court (LHC) has suspended the notification, but the VoIP companies have not reduced the rates. Whatever may be the reason, I must say if the Estate & Govt. rape their own ppl, the others around won’t miss either.
    Today, no nation dare to touch the Americans, Britisher, Canadian, etc……..just bcoz their governments worth them.
    And, the bitter fact……….Like Nation, Like Rulers !Recommend

  • Asad

    Now the big stakeholder i.e PTCL who was pushing govt has created a oglopoly with help of other voips and definitely under govt assisted robbery procedure to fix a rate for all such calls. If Zardari and his core allies MQM and ANP could sense something about their wrong doings then they can easily imagine the crime they are committing at stake of overseas pakistanis. They can also understand the negative feelings that comes to people mind by the oppressive measure they are taking for the sake of their luxury (all in the name of democracy) Recommend

  • Asad

    @sheraz:
    Please provide me the details @[email protected]Recommend

  • http://[email protected] jehan muhammad

    @Jamshed:
    but some vilage internate is no working dearRecommend

  • Muhammad Zahid

    i have heard that the calling rates will be in low rates on november 30 but there was no change in calling rates…i hope PTA will think about calling rates..Recommend

  • Hmaza

    Any Idea how long is this nonsense going to last, been over a month alreadyRecommend

  • mrs ali

    the Pakistan Telecommunication Authority (PTA) on Tuesday announced to withdraw the tax on incoming international telephone calls.Recommend

  • Umar

    Congratulations .. PTA withdraw all the taxes .. rates should now be back to normal or less then before.Recommend

  • http://www.facebook/ismailkhan Ismail

    Yes i also say a report on Geo news and Express newspaper about reducing call rates for incoming calls from out of countries but when the PTA implement new notification for this because in U.A.E (Dubai) still same calls rates after increasing rates.can any body give m details about this when th PTA reducing calls tax?Recommend