Pakistan economy.
Name: Arham Aziz
Roll no: 19710
Topic: IT in
Pakistan
Content
Introduction
IT Strategy
IT Export Revenue
IT Exports & Earnings
Trade Surplus of the IT Industry compared
to the rest of the Services Sector
Sector Brief
Opportunities/ Reasons to Invest in the IT
Sector
Trend Analysis
Conclusion
Introduction
Information technology in Pakistan is a growing
industry that has the potential to expand more in
the future. Matters relating to the IT industry are
overseen by the Ministry of Information
Technology of the Government of Pakistan.
The IT industry is regarded as a successful sector
of Pakistan economically, even during financial
[Link] first IT policy and implementation
strategy was approved under the leadership of
Atta-ur-Rahman, the Federal Minister of Science
and Technology in August 2000 which laid the
foundations of the development of this sector
Introduction
There are 5,109 IT and ITeS companies
registered with Pakistan Software Export Board
(PSEB) as of March 2023 representing the
exporters. Major Tech hubs of IT and ITeS
industry are Lahore (36.4 percent), Karachi (28
percent), and Islamabad/ Rawalpindi (27
percent) of PSEB registered companies. The
remaining 10 percent of registered companies
spread all over the country. The relevant
stakeholders are putting maximum efforts to
increase the number of companies by increasing
the number of Software Technology Parks (STPs)
and enabling IT and ITeS industry to capitalize
the countrywide talent.
IT Strategy
Pakistan's vision 2025 lay special emphasis on
Knowledge economy. It is well understood that if
Pakistan has to come out of its economic
recession, it has to best utilize its youth bulge.
Utilizing the 41R technologies Pakistan economy
can be transformed to digital economy. Through
Digital Economy, GOP wants to ensure economic
prosperity and citizen empowerment.
To achieve above objectives, MolTT has adopted a
multipronged strategy that focuses on building the
capacity of public and private sector besides
establishing of requisite infrastructure and
platforms.
IT Strategy
Key pillars of this strategy are:
E-governance
IT Infrastructure
Human Capital Development
Innovation and Entrepreneurship
IT/ITeS Development and Export
Fintech, E-commerce and Digital Platforms
Privacy and Security
Partnership and Collaboration
IT Export Revenues
IT export remittances play a major role in
Pakistan's economy. The information and
communications technology {ICT) export
remittances have surged from $1.06 billion
in 2018 to $2.6 billion as of 2022. This
represents an unprecedented annual
growth rate of 40% in dollar terms.
Industry revenue is projected to reach $5
billion by 2023. With over 5,000 IT firms
now operating, Pakistan's IT capabilities
and competitiveness in international
markets continue to heighten.
IT Export Revenues
Economic Growth can
be targeted through
the use of IT
ecosystem which
may provide enabling
environment to
business growth,
help job creation and
enhance citizen
empowerment
through E-
governance.
Trade Surplus of the IT Industry
compared to the rest of the Services
Sector
Pakistan's IT
Industry is the
largest net
services
exporter with
exports to 169
countries as
reflected in
table.
Sector Brief
The 4th Industrial
Revolution is currently
taking place and it is
digital. The actual size
of the 2016 digital
economy was $11.5
trillion globally, which
was 15.5% of the global
GDP. The base digital
assets comprise one-
third, or $3.8 trillion,
while digital spillover
effects account for the
remaining two-thirds,
$7.5 trillion.
Sector Brief
Pakistan, which has about 60% of its 200
million population in the 15 to 29 age group,
represents an enormous human and
knowledge capital. Pakistan has more than
2000 IT companies & call centers and the
number is growing every year. Pakistan has
more than 300,000 Englishspeaking IT
professionals with expertise in current and
emerging IT products and technologies, 13
Software technology parks, More than 20,000
IT graduates and engineers are being
produced each year coupled with a rising
startup culture.
Sector Brief
Information technology
has assumed a central
enabling role in the
emerging dynamics of a
knowledge society and
knowledge economy. It is
a key lever of economic
development. Pakistan's
Information Technology
{IT) sector is carving a
differentiated position as
the preferred source for
software development,
BPO and freelancing.
Pakistan was ranked at
number four for freelance
development in the world
and IT exports have
Sector Brief
Digital growth in Pakistan is going
through a rapid evolution. IT/ITeS
Sector is one of the fastest
growing sectors of Pakistan
contributing about 1% of GDP of
Pakistan at about 3.5 billion USO.
It doubled in the past four years
and experts expect it to grow a
further 100% in the next two to
four years to $7 billion.
Sector Brief
IT exports were recorded to be
the highest in the history at
$1.067 billion in the fiscal year
2017-18 compared to $939
million registered in the
previous fiscal. Pakistan's
software exports are currently
worth $700 million, according
to the State Bank of Pakistan
(SBP). However, the country's
freelancers also earn another
$1.2 billion in exports, an
amount not recorded by the
central bank as they are not
registered. Moreover, another
$600 million in exports are
from those companies that do
not bring their revenues to
Pakistan.
Sector Brief
In accordance
with Pakistan
Vision 2025 and
the Digital policy
of Pakistan 2018,
the ICT industry
size is targeted to
reach $20 billion
by 2025.
Sector Brief
Most importantly the security
situation of Pakistan has
improved. Startups like careem,
daraz, [Link] [Link] and
their success is bringing
investment into Pakistan as
evident from the recent
acquisition of daraz and easypaisa
by AliBaba. Traditional investors
from other Pakistani sectors like
textile, fertilizers are also taking
special interest in the startup
ecosystem.
In the traditional IT outsourcing
other south Asian nations are
become increasingly expensive
and these countries are finding it
hard to compete in the technology
areas like artificial intelligence,
internet of things, cyber security,
automation etc.
Opportunities/
Reasons to Invest
in the IT sector
Key highlights
Pakistan's IT exports have increased 70%
during the last three years
zero income tax on IT & ITeS exports
zero Income tax for PSEB registered IT
start-ups
100% foreign ownership of IT & ITeS
companies
100% repatriation of profits to foreign IT
& ITeS investors.
Tax holiday for venture capital funds till
2024.
Trend Analysis
Trend Analysis
Trend Analysis
Conclusion
The latest information system helps a
country integrating domestically and
globally by enhancing its capacity in the
areas of fast internet access, software
development, app development, adoption
of technological gadgets, and digitization
of economy. Modern IT infrastructure is the
corner stone for realizing economic
development because it improves access to
information, connectivity and ameliorate
entrepreneurial efficiency and growth.
Thank you
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