Mobile manufacturers to face penalties over lack of localisation

The government has decided to impose penalties on mobile and electronics device manufacturing companies over failure to achieve specified localisation levels in the stipulated time period under the proposed new policy. As part of the Mobile and Electronics Device Manufacturing Policy 2026-33, the government will withdraw concessions like all exempted or concessionary duties. It will also start applying normal tariff rates and the companies will face import licensing restrictions. Monetary penalties shall be imposed in the form of a surcharge equivalent to 1% of the total annual import value, in addition to any other financial liabilities prescribed in the prevailing laws and regulations. The government has targeted a rebate of Rs103 billion on the export of mobile phones by allowing a fixed and non-discretionary 8% research and development allowance. This allowance has been calculated on the basis of verifiable free-on-board value of mobile devices exported by Pakistan.