Internet, cell phones linked to poverty alleviation


KARACHI: United International Group’s Chairman Mian Shahid on Monday said Internet and mobile phones are among the most effective tools to lift people out of poverty and provide opportunities to entrepreneurs.

Government should reduce taxes on the telecom industry and Internet service providers as these two sectors are directly linked to growth in the GDP, he said while talking to Samina Fazil, founder President, Islamabad Women’s Chamber of Commerce and Industry, he said that Pakistan’s telecom industry has been paying Rs 60 billion in taxes which is one of the highest in Saarc region.

Shahid said that mobile phones have brought remarkable social progress in low-income countries while its impact has been estimated at a quarter of trillion USD in the poverty belt that includes South Asia and Sub-Saharan Africa. This is a great productivity tool which make citizens economically strong who in turn make their governments more accountable and friendly to worthy causes including a peaceful and prosperous world.

He said that according to a study of 120 countries conducted by the World Bank, a 10 per cent increase in mobile phone penetration results in a 0.8 per cent increase in economic growth. From 1996 to 2011, mobile phone penetration in South Asia and Sub-Saharan Africa combined rose from zero per cent to 63 per cent. During the 15-year period the poverty belt experienced on average an additional one per cent economic growth rate due to mobile phones, the study says.

The business leader said that within this same period, the combined GDP of South Asia and Sub-Saharan Africa grew, from $811 billion to $1,870 billion, an average annual growth rate of 5.72 per cent. Without the impact of mobile phones, these economies would have grown at an annual rate of 4.72 per cent, and the economy of the poverty belt by 2011 would be only $1,620 billion.

Mobiles are not a luxury product became a mass product that advances economic situation of consumer by saving time, money, labour, transportation, and opportunity costs. Cell phones have resulted in continued economic and social progress in low-income countries therefore telecom industry must be promoted by policymakers.