Pakistan Railways raised fibre broadband track crossing fees significantly

Over a five-year period, Pakistan Railways has significantly boosted the right of way (ROW) payments for a single-track crossing to an astounding Rs. 3.8 million.

Dr. Umar Saif, the acting federal IT minister, recently announced long-awaited changes to telecom regulations along with a decrease in ROW costs for fibre internet in an attempt to spearhead the nation’s digital transformation. This prompted the action.

Building fibre internet requires telecom companies to cross railroad tracks. For five years, Pakistan Railways used to charge Rs. 100,000 for each track crossing.

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By raising rates to Rs. 2.7 million for a five-year term in 2007, Pakistan Railways took advantage of the possibility to profit from ROW charges with the introduction of fibre broadband.

Laws specify that the ROW charge must be paid on a “no profit, no loss” basis and that governmental entities are not permitted to use it as a means of profit. In 2022, the government led by the PTI lowered crossing fees to Rs. 600,000 per crossing, payable forever, in response to telecom providers’ long-standing demands for increased fibre access.

But in May 2023, the PDM administration repealed this decree. On December 12, 2023, Pakistan Railways stated that telecom businesses will pay an exponentially higher train crossing tariff of Rs. 3.8 million for five years, while cable TV operators would only pay an annual fee of Rs. 100. This is because the department thinks that because telecom operators are more profitable than cable TV operators, they should be paid millions of times more.

According to Wahaj Siraj, vice chairman of the Telecom Operators Association of Pakistan, “Railways is trying to mint money illegally from telecom operators at the cost of blocking investments in broadband and pushing the country back into the dark ages.”

It is unprecedented and absurd, he claimed, to charge so much for putting fibre across a tiny stretch of state-owned land. Regarding the Special Facilitation Investment Council (SIFC), which is led by Pakistan’s Prime Minister and features the Chief of Army Staff as a major member, the telecom sector has expressed grave worries. The SIFC is making a lot of changes to support the telecom and IT industries.