Mohsin Siddiqui (Chief Reporter)
Pakistan’s information technology and IT-enabled services (ITeS) export remittances, encompassing computer services and call center services, have achieved an unprecedented milestone. The sector reached an all-time high of $3.223 billion in the fiscal year 2023-24, reflecting a 24% increase from the previous year’s $2.596 billion. This remarkable growth underscores the significant strides Pakistan is making in the global IT arena.
The official data indicates a mixed performance on a month-on-month (MoM) basis. In June 2024, ITeS export remittances experienced an 11.3% decline, amounting to $298 million compared to $332 million in May 2024. However, on a year-on-year (YoY) basis, the sector demonstrated robust growth. The remittances increased by over 32% from $225 million in June 2023 to $298 million in June 2024.
In the fiscal year 2022-23, ICT export remittances, including telecommunication, computer, and information services, stood at $2.596 billion, a slight decrease of around 1% from $2.619 billion in the fiscal year 2021-22. Despite this minor setback, the sector rebounded strongly in FY24, highlighting its resilience and potential.
The Ministry of Information Technology and Telecommunications, in collaboration with the Pakistan Software Export Board (PSEB) and the Special Investment Facilitation Council (SIFC), has played a pivotal role in this success. Their concerted efforts to accelerate international business development and improve the ease of doing business have significantly boosted IT and ITeS exports. These initiatives have also bolstered the confidence of the IT industry.
However, the ministry has identified several constraints that need addressing to unlock the sector’s full potential. These include inconsistencies in policies, taxation issues, and banking hurdles. Resolving these challenges is crucial to achieving the ambitious target of $15 billion in annual exports within the next five years.
According to the Economic Survey, Pakistan’s IT industry currently generates around $2.6 billion in annual exports. To reach the $15 billion target, it is essential to add at least 200,000 proficient and specialized IT professionals. The sector caters to some of the world’s largest entities among its regular clients, showcasing its capability and scope.
Several international companies have established a significant presence in Pakistan, contributing to job creation and foreign direct investment (FDI). Global enterprises like Bentley, Ciklum, IBM, Mentor Graphics, S&P Global, Symantec, Teradata, and VMware have set up global consulting services centers, research and development facilities, and Business Process Outsourcing (BPO) support services centers in the country. These establishments generate high-paying job opportunities for talented youth, enhance Pakistan’s soft image, and attract FDI.
The major tech hubs in Pakistan’s IT and ITeS industry are Karachi, Lahore, and Islamabad/Rawalpindi. These cities are home to over 600,000 English-speaking IT and BPO professionals with expertise in current and emerging IT products and technologies. This skilled workforce is a significant asset, driving innovation and growth in the sector.
To sustain and further accelerate this growth, several key initiatives and strategies are being implemented:
Ensuring consistent and supportive policies to foster a conducive environment for IT businesses. Addressing taxation issues to reduce the financial burden on IT companies. Overcoming banking hurdles to facilitate smoother financial transactions and remittances. Investing in education and training to equip more professionals with specialized IT skills. Enhancing digital infrastructure to support the growing demands of the IT sector.
Strengthening international ties and collaborations to expand market reach. Promoting research and development to drive innovation and competitiveness. Offering incentives to attract more foreign and domestic investments in the IT sector. Encouraging partnerships between the government and private sector to leverage resources and expertise. Raising awareness about the opportunities in the IT sector to attract talent and investment.
