Apple Approves iPhone Manufacturing Plan for Pakistan
American tech giant Apple is preparing to begin iPhone manufacturing in Pakistan after the government agreed to offer special incentives under the proposed Mobile and Electronics Manufacturing Framework. The company has also committed to refurbishing older iPhones within Pakistan for re-export, with the government expecting to earn up to $100 million in the first year from the export of refurbished devices.
According to Engineering Development Board (EDB) CEO Hamad Ali Mansoor, Apple has outlined three key requirements to start operations in the country: the provision of land at discounted rates, an 8% performance-based incentive, and permission to repair and refurbish two to three-year-old iPhone models. These conditions have been incorporated into the new policy, which is expected to receive approval from Prime Minister Shehbaz Sharif. Mansoor noted that Apple followed the same model in Indonesia, Malaysia, and India, where it initially focused on refurbishing older devices to train local workers before shifting toward full-scale manufacturing.
The government currently offers a 6% performance incentive to mobile manufacturers, but this is being increased to 8% to attract Apple and other global brands. Special Assistant to the Prime Minister on Industries and Production Haroon Akhtar Khan and the Secretary of Industries have extended full support to the development of the new mobile and electronics framework.
Pakistan is also expecting significant investment from Chinese firms, with $557 million worth of commitments made through Memoranda of Understanding (MoUs) signed during Prime Minister Shehbaz Sharif’s recent visit to Beijing. Mansoor said the new policy is designed to attract investment in the production of laptops, tablets, smartwatches, trackers, and earbuds, with the broader goal of establishing Pakistan as a regional hub for mobile and electronics exports.
A major focus of the new framework is the localisation of mobile phone components. Manufacturers have assured the government that they will increase the use of locally produced parts to 35% in the first year, compared to the current level of 12%, with plans to push localisation to 50% in the coming years.
To support technology development, the government plans to impose an export levy of up to 6% on higher-end mobile phones under the new framework. The levy, expected to generate Rs62 billion, will be reinvested to accelerate localisation efforts. Phones priced between Rs50,000 and Rs60,000 will remain exempt from this levy, while it will apply to devices costing above Rs100,000.
Meanwhile, the government is also working on initiatives to promote electric vehicles (EVs) in Pakistan. A policy offering subsidised electric two-wheelers is currently in place, with Rs9 billion allocated to provide a 40% subsidy. A tax of up to 3% has been imposed on the sale value of conventional vehicles to support the e-bike scheme. Mansoor revealed that a Lahore-based company is establishing a plant to produce affordable electric four-wheelers, priced between Rs700,000 and Rs800,000, similar to the cost of locally manufactured small cars.
The government has collected Rs12 billion in taxes over six months—exceeding its target of Rs9 billion—for the e-bike subsidy scheme. With this surplus, the scope of the initiative may be expanded to include electric four-wheelers. Plans are also underway to make the e-bike scheme available to the public without balloting in its next phase. Mansoor added that the government is prioritising the digitisation of the auto industry, including certification processes, to ensure transparency and efficiency.
