Karachi City, Pakistan – On a hot day in Karachi, Pakistan Railways official Mohammad Junaid parked his motorcycle on the side of the road and asked passers-by if they needed a ride. Junaid works part-time for a ride-hailing service provider and earns about 800 Pakistani rupees ($2.7) a day.
“My salary is not enough to cover my expenses,” he told Al Jazeera. “I have to work for Bykea [the ride-hailing startup] to support a family. ”
However, the outage of internet service has reduced revenue as they book rides through an app that requires internet.
The same is true for thousands of app-based food delivery service passengers.
Following the arrest of Imran Khan, chairman of the Pakistani political party Tehrik-e-Insaf, severe internet connectivity problems have been reported in the country’s biggest cities over the past three days. After his arrest, protests erupted across the country, including in front of the Pakistan Army General Headquarters. Violence was witnessed in many cities.
The Pakistan Telecommunications Authority said on Tuesday that mobile broadband services had been suspended at the direction of the Ministry of Interior, but did not give a timeline for restoration. Khan was ordered to be released on Thursday after the country’s Supreme Court ruled his arrest unlawful. However, the suspension of mobile broadband was not lifted.
The decision comes at a time when Pakistan’s economy is struggling on many fronts.
Headline inflation hit a record high of 36.4% in April. Remittances from workers, who contribute more than 8% to the economy, fell 29.2% in April compared to the same month last year. Exports in April decreased by 26.68% from the same month last year. The World Bank revised its growth forecast for Pakistan from 2% to just 0.4%.
Political turmoil in the country pushed the Pakistani rupee to a new low of 298.93 rupees against the US dollar in the interbank market on Thursday.
“Pakistan has long suffered from twin deficits, a current account balance and a fiscal deficit,” said Ethan Malik, CEO of the Pakistan Business Council, a cross-industry advocacy group. . “They have now been overtaken by a third deficit, the trust deficit. The recent trend is the continuation and accumulation of this deficit.”
“The IMF [International Monetary Fund] I don’t trust the current government or the previous one,” Malik said of the lack of trust. “Our traditionally friendly countries are reluctant to offer assistance. [as Islamabad has not met all IMF bailout conditions]. Politicians do not trust each other.The judiciary is divided and the government is at odds [the judiciary’s] decision. ”
He said supply has been hit by a shortage of foreign exchange reserves, while demand has shrunk significantly due to inflation.
“Skilled people, mainly IT professionals and engineers, are leaving Pakistan in search of opportunities abroad,” he said.
Samiullah Tariq, head of research and development at Pakistan-Kuwait Investment Company, said the recent turmoil could delay the resumption of IMF programs that have been linked to Islamabad securing funding from partners.
“The recent turmoil may delay the arrangement of necessary funding from bilateral and multilateral partners,” he said.
Furthermore, tax collections are likely to fall as economic output declines, while unemployment will rise, disproportionately impacting gig economy workers who rely on mobile internet, he added.
“Political Circus”
Ville Aerola, chairman of the Finnish-Pakistan Business Council, said the current ‘circus’ in Pakistan is damaging its international image and discouraging foreign direct investment (FDI).
“The political circus going on in Pakistan is utter nonsense from an international perspective and such things will only damage or destroy Pakistan’s image as a country of international business and FDI,” he said. said.
“Do you really want to create an image of a country with mass demonstrations, political instability and demonstrations everywhere? Some sort of so-called banana republic? But do we want foreign investors to be interested in Pakistan?
Aamir Ibrahim, CEO of mobile network Jazz, said mobile broadband is the lifeblood of the digital ecosystem and a key enabler of productivity in all areas.
“This disruption not only limits our ability to communicate with friends and family, but also deprives 125 million Pakistanis of access to essential services critical to their well-being, including education, health care and commerce. It will be taken,” said Ibrahim.
“It also hinders their participation in the global economy, as freelancers will continue to be severely affected by this suspension.”
Industry sources told Al Jazeera that the disruption has cost operators an estimated 1.64 billion rupees ($5.4 million) in lost revenue and the government has lost about 574 million rupees ($1.9 million) in tax revenue. said. The source requested anonymity for fear of repercussions from government officials.
Ibrahim Amin, president of the Pakistan Freelancers Association, said the internet service outage is costing the IT freelancing industry nearly $200,000 a day.
He added that this has also created a very bad image for Pakistan’s IT sector and will affect the country’s IT business in the future.
Meanwhile, Israel-based Fiverr, an international platform for freelancers to connect with people in need of services such as content writing and software programming, responded by automatically putting Pakistani IDs into disabled mode. there is
Fiverr said on its website that the freelancer from Pakistan lives in an area currently experiencing internet chaos. He added that these freelancers may not be able to fulfill orders as quickly as possible.
Jehan Ara, a member of the World Bank’s Gender Advisory Board, said people in her international network messaged her asking how she was coping after seeing horrifying images of violence. Told.
“Investors are withholding investments because they are not only concerned about the dollar-to-rupee rate, inflation, or the policies of state banks. We are concerned,” said Ara, who is also the founder and CEO of Catalyst Labs, a technology accelerator in Karachi.
“Our e-commerce business, which had grown due to the steady increase in digital adoption, was all hit in unison. Ride-hailing services, online marketplaces, food delivery businesses were all hit. The drivers and delivery men who live there.”
“Imran Khan’s arrest has angered many young people who consider him the only hope of the country,” she added.
