Smartphone prices jump by up to Rs30,000 in Karachi as memory costs climb
Dealers and assemblers blame dearer chips and AI driven demand for memory, and buyers are turning to used and refurbished handsets.
A basic smartphone that cost about Rs20,000 until last year now sells for more than Rs30,000 in Karachi. Major brands have raised prices by Rs15,000 to Rs30,000 per handset, according to a Dawn report published on 26 October, and dealers say budget buyers are hit hardest.
The benchmark is a phone with 4GB of RAM and 64GB of storage. Dawn put the average for that specification at about Rs40,000, against about Rs22,000 a few months ago, though some shops quote Rs35,000 to Rs40,000.
Chips, not taxes
Muhammad Rizwan Irfan, president of the Karachi Electronics Dealers Association, said taxes had not risen enough to explain the jump. He said the main cause is the rising cost of chips. Mian Abdul Rehman of the Pakistan Mobile Phone Manufacturers Association pointed to memory. He linked higher RAM and ROM prices to the rapid growth of AI systems, robotics and data centres, and said handset makers are finding it harder to absorb the extra cost.
“AI companies are buying RAM and ROM at very high prices, which is driving up their cost.”
Industry experts had warned of this on 5 August, saying demand for advanced chips from AI data centres had pushed up memory, wafer and packaging costs. Pakistan imports most of its phones and components, so global costs pass through quickly. Imports of fully built phones rose from about 290,000 units in the 2024 to 2025 fiscal year to 1.04 million in 2025 to 2026, according to customs data.
Buyers trade down
Lower and middle income buyers are hit hardest, and some are delaying purchases or dipping into savings. Shopkeepers say sales have fallen sharply and that price swings and supply shortages make stock hard to plan. One told Dawn that when a phone costing Rs20,000 rises to Rs30,000 or Rs35,000, many customers can no longer afford it. A buyer at Saddar Mobile Market said a model he wanted rose from Rs22,000 or Rs23,000 in August to about Rs30,000, then climbed again the next month.
Some customers are choosing used phones, keypad phones or kit phones, which are refurbished handsets imported in bulk without retail packaging to avoid heavy customs duties. Some also blamed government taxes and the effect of the US Iran war on trade and component exports. Buyers in Saddar, Buffer Zone and North Karachi asked the government to keep basic smartphones affordable, since phones are now needed for banking, transport, schooling and government services.
