ISLAMABAD: The China Mobile Pakistan (CMPak), operating under the brand name Zong, has sought the application of an industrial electricity tariff for its Cloud and Integrated Data Centre (IDC) facilities, arguing that high energy costs are undermining the competitiveness of local data centres and discouraging international cloud providers from localising infrastructure in Pakistan. In a letter addressed to Secretary Ministry of IT and Telecommunication (MoITT) Zarrar Hasham Khan — copies of which were sent to the chairman NEPRA, secretary Power Division and secretary SIFC — Director Regulatory Affairs, CMPak Ltd, Shahid Razzaque, stated that the China Mobile Pakistan has traditionally operated as a licenced telecommunication company in Pakistan, making substantial investments in nationwide connectivity infrastructure and digital inclusion. He noted that with the evolution of the market and the changing business landscape, the CMPak has strategically diversified into emerging digital infrastructure domains, particularly Cloud Services and Integrated Data Centre (IDC) businesses, in line with the government’s vision of Digital Pakistan. READ MORE: Zong unveils AI Roadmap for Pakistan 2030 initiative In this regard, the CMPak has established a Tier-III rated data centre at its Islamabad headquarters in Chak Shahzad, representing a significant capital investment and a long-term commitment to Pakistan’s digital ecosystem. The company also has concrete plans to establish similar Cloud and IDC facilities in Lahore and Karachi to support government digitalisation, local content hosting, data sovereignty, and enterprise-grade cloud services. However, while participating in government tenders related to cloud, hosting, and data centre services, the CMPak faces a structural competitive disadvantage. Companies incorporated as IT entities or operating within Special Technology Zones (STZs) enjoy extensive fiscal incentives, including tax holidays, rebates, and customs exemptions under the Special Technology Zones Authority (STZA) framework. As a telecommunication company, the CMPak is currently not eligible for STZ inclusion, as telecom operators are excluded from obtaining Zone Developer (ZD) or Zone Enterprise (ZE) licences under the existing policy framework. This creates an uneven playing field, despite CMPak offering identical Cloud and IDC services, deploying comparable technologies, and competing for the same government projects. Consequently, the company’s bids become less competitive on cost — not due to inefficiency, but because of the absence of fiscal incentives available to similarly placed service providers. The CMPak has argued that Cloud and IDC businesses should be treated based on the nature of services provided rather than the legacy licencing category of the parent company. The company emphasised that its Cloud and IDC operations are distinct from its core telecom services and are fully aligned with national objectives, including: (i) promotion of local data hosting and data sovereignty; (ii) enablement of e-government platforms and public sector digitalisation; (iii) development of indigenous cloud infrastructure; (iv) attraction of foreign investment; and (v) creation of high-value jobs in IT and digital services. Accordingly, the CMPak has requested MoITT’s support in formulating a policy mechanism under which telecom operators engaged in Cloud and IDC businesses are granted fiscal parity, including tax exemptions or incentives equivalent to those available to IT companies and STZ-based enterprises, at least for their Cloud and IDC verticals. Such parity, the company argued, would ensure fair competition in government tenders and accelerate the growth of Pakistan’s digital infrastructure. The company has also highlighted the critical issue of electricity tariffs for Cloud and IDC operations. Data centres are capital-intensive and energy-dependent infrastructure facilities, with electricity costs being a decisive factor in their commercial viability. Despite the telecom sector being officially declared an industry, telecom operators have been unable to avail industrial electricity tariffs, with the matter remaining entangled in litigation with NEPRA for several years. The CMPak warned that without access to industrial electricity tariffs for Cloud and IDC facilities, Pakistan’s IT and cloud ecosystem would struggle to scale sustainably. High energy costs, it said, not only erode the competitiveness of local data centres but also deter international cloud providers from localising infrastructure in the country. In this context, the CMPak has urged MoITT to: (i) advocate for the application of industrial electricity tariffs for entities engaged in Cloud and IDC businesses; and (ii) champion fiscal and regulatory support for Cloud and IDC infrastructure as a strategic national asset critical to Pakistan’s digital economy. “We firmly believed that timely policy intervention and fiscal support will enable telecom operators like the CMPak to make further investments, support government digital initiatives, and contribute meaningfully to Pakistan’s IT exports and digital resilience,” said Shahid Razzaque, Director Regulatory Affairs, CMPak Ltd. Copyright Business Recorder, 2026