"Unfortunately this incident will send a wrong message to the international community, especially to those thinking setting up of call centres in Pakistan."

By Ashraf Khan
July 11 - 17, 2005

Internet Connectivity finally returned to life Friday last, paralyzing the entire socio-economic life due to disrupted communication network for almost 11 days in the country. According to PTCL, Dubai-based experts have restored the fault developed in the undersea cable near Karachi.

Pakistan's telecom sector, which has lately emerged as one of the fastest growing sector of the country, however carries a big question mark about its gigantic infrastructure which caved in to a tiny fault merely 12 km Southwest of Karachi coast in deep Arabian Sea.

The fault that developed late last month in the submarine fibre-optic link incapacitated millions of Internet and telephone users. Satellite link-ups have restored some services but damage had already been done. "It is difficult to give the account of monetary losses now but it has definitely caused millions of dollars potential losses and a lot of intangible damage you cannot quantify," owner of the largest chain of the US out-sourced call centres Farrukh Aslam said.

Pakistan's telecom sector made a robust growth in the past few years after strings of reforms and liberalization that increased the sector's contribution to country's gross domestic product (GDP) to 1.8 percent in fiscal ended June 30 from 1.5 percent in the previous year.

"How pathetic it is on the part of planners and the leadership that despite making tall claims of revolutionizing the sector they are banking on only one fibre optic link to connect with the outer world," said Aslam who is the President of Call Centres Association of Pakistan, which members number about 25.

Pakistan's Minister for IT and Telecom Sector Awais Leghari conceded Aslam's comments and was concerned over cable failure. "Unfortunately this incident will send a wrong message to the international community, especially to those thinking setting up of call centres in Pakistan," Leghari was quoted as saying in the local newspapers.

Telecom sector was able to attract 207.1 million dollars foreign direct investment in the fiscal 2003-04 and estimated to attract over two billion dollars in FDI for the year 2004-05.

It has also helped generate considerable employment and in the past two years it provided direct or indirect employment to 341,622 Pakistanis, according to official statistics.


The industry representatives were also mournful of huge potential losses, which they could have attracted from neighbouring India. The incident exposed Pakistan's reliance on a single undersea telecommunications cable running from the port city of Karachi to the Fujairah Landing Station on the eastern coast of the United Arab Emirates (UAE), where it initially splits into two routes on its way to Europe and the Americas. The cable, which connects South East Asia, Middle East, and Western Europe thus is called SEA-ME-WE-3.

The Fujairah-Karachi undersea cable provides high-quality voice and data transmissions but is not 100 percent reliable, leading to the use of satellite backup systems. Pakistan's satellite telecommunications systems have limited capacity and delays of 400 to 500 milliseconds to and from the US, down from 450 to 550 milliseconds in 2002. Delays in excess of 500 milliseconds are considered unacceptable for commercial call centre traffic. This situation does not disqualify the placement of mission-critical work in Pakistan, but it might make Pakistan appear less competitive than more expensive and lower quality IT service providers elsewhere in the region. In India there have been five such trans-regional cables, which serve its telecom needs uninterrupted.

PTCL was not even able to have a technical backup or even expertise to timely and effectively know as to what was wrong with the cable despite knowing that the fault was mere 12 kilometers off the Karachi coast. Technical backup was pathetic on the part of cable operator i.e. Singtel as the ship it ordered to sail to the faulty point did not carry facilities to undertake submarine operation. So delay become rather indispensable as it had to summon another ship from UAE with such facilities.

But the single-source reliance has meanwhile doomed further expansion plans in IT sector. The call centre industry was looking ahead to bring in a business of about 1.5 billion dollars from India as the US principals were finding substitute of the country and Pakistan has been tipped as an effective alternative because of lower wages and better English accent.

Besides, call centres online banking and airline businesses were another hits. "Our all business including reservation, ticketing, check-ins and 500 agents all around the world are web-based and it all affected badly," said Nasir Ali, Director of Airblue, a private airline.

"We had to switch on manual work and that was very difficult for us besides we suffered severe damage to our market credibility," he said.

Pakistan Telecom Company Limited (PTCL), which has been recently sold to Etisalat of UAE as part of the country's privatisation plan, is trying to join more cable links to forestall any future mishaps.

"We have already an agreement in hand with a consortium of 13 companies which is laying sub-marine cable and by October this year it would be operative," said PTCL's Senior Vice President for Special Projects, Mashkoor Hussain.

The project envisages adjoining 13 countries through the cable, for which a protocol was signed in 2002. Fujitsu of Japan and Alcatel of France are laying the 500 million-dollar cable which offer higher capacity of communication and called SEA-ME-WE-4. Besides Pakistan and other countries, the cable would connect India, UAE, Egypt, France, Indonesia, Bangladesh and Sri Lanka.

"We are also negotiating with India to joining a cable passing near our common border," he said.

But the industry is not convinced of the government plans.

"I can bet you if the cable comes in operation by October and I have all my doubts they could successfully negotiate a deal with Indians," Aslam said and added:" these are all bureaucratic and political lies."