Islamabad, December 17, 2025 – The Pakistani government is grappling with a classic Catch-22 situation as it prepares for the country’s first 5G spectrum auction targeted for the first quarter of 2026. Amid widespread public complaints about poor mobile services – including frequent call drops, slow internet speeds, and network congestion – officials are torn between setting high reserve prices to maximize short-term revenue and lowering them to encourage telecom operator participation and faster rollout.
A recent Spectrum Advisory Committee (SAC) meeting, chaired by Finance Minister Muhammad Aurangzeb, remained inconclusive on key issues like reserve prices and auction timelines. US-based consultant NERA Economic Consulting presented findings warning that excessively high prices could deter bidders, leading to unsold spectrum, reduced competition, lower innovation, and higher costs for consumers. Conversely, NERA argued that moderate pricing, combined with extended payment terms, could yield greater long-term government revenues through increased tax collections and economic growth.
Pakistan currently has only 274 MHz of spectrum allocated for mobile services serving nearly 200 million subscribers, with 600 MHz lying idle – far below regional peers like Bangladesh, which has allocated around 700 MHz for fewer users. Past auctions have seen significant unsold spectrum due to high base prices, dollar-pegged valuations (exacerbated by 70% rupee devaluation since 2021), and unfavorable terms.
The GSMA estimates that delays in spectrum release could cost Pakistan’s GDP up to $1.8 billion (Rs500 billion) over 2025-2030 for a two-year holdup, rising to $4.3 billion for five years, while foregone benefits from previous unsold spectrum amount to $300 million.
Briefings to the Prime Minister and Deputy Prime Minister are imminent, with decisions pending on unlocking idle spectrum and incentives for the 3.5 GHz band to boost 5G fixed wireless access. Telecom operators and experts urge reforms to prioritize service quality and digital economy growth over immediate fiscal gains.