Pakistan’s IT sector continued to pace up its exports of services to various countries in the first quarter of the financial year 2020-21, fetching significant foreign exchange for the country and recording a 40 percent growth year-on-year.
According to data released by the State Bank of Pakistan (SBP), the remittances under IT and IT-enabled services have surged to $444 million during the period of July to September this year as compared to $315 million recorded in the similar period of last year.
IT sector emerged as the gainer of the prevailing situation of the Covid-19 pandemic. Pakistan’s IT industry is tapping opportunities with its available potential and resources generating healthy foreign exchange for the country.
Living with the pandemic, everyone has now realized that the only way to survive in this market is to go digital, said Zeeshan Aftab, Co-founder of 10Pearls – an IT services exporting company.
Global and large-scale organizations have increased their budgets for IT spending in the last few months, which is paving ways for Pakistan’s IT industry. He said, adding that “as Pakistan is known for its talent and has lesser impact of the pandemic, we are getting traction”.
Large organizations have increased spending on product development, Artificial Intelligence, telemedicine, and business process automation. Besides, there is an increase in demand for e-commerce solutions mainly from small to medium enterprises (SMEs).
Pakistan’s major export markets remained the USA, UK, Europe, and the Middle East. It is working extensively in the areas of software consultancy, automation, e-commerce, BPOs, and artificial intelligence.
It is pertinent to mention here that the remittances of Pakistan’s IT exports reached a record all-time high at $1.48 billion with a 20 percent year-on-year growth in the outgoing financial year of 2019-20, according to SBP’s data. The industry experts believe the exports of IT and IT-enabled services are three times higher than the reported values in accordance with the international standards prescribed by the World Trade Organization.
Pakistan Software Houses Association for IT and ITeS ([email protected]) Chairman Barkan Syed said, “Pakistan’s IT exports have pickup consistently for the past two years but they have accelerated in pace since May due to the opportunities emerging from the Covid-19 pandemic and the improving image of the country worldwide, particularly in export countries.”
Pakistan’s overall image has improved in the markets particularly in the recent months as it made headlines for controlling Covid-19 spread through smart lockdowns, he said, adding that IT services are termed as essential services in the country and the preventive work-from-home strategy taken by the companies has been successful due to the availability of internet connectivity in the major cities.
Our country is being preferred for placing orders in different markets rather than India owing to the adverse situation in tackling coronavirus and poor internet services in the neighboring country, [email protected] chief claimed.
Barkan said that the growth in exports in Pakistan is optimistically inevitable after the switch of exporters’ choices in the business because Pakistan’s IT companies produce high-quality work with an established reputation among clients.
According to SBP’s data, software consultancy attracted exports of $115 million. It is followed by telecommunication services with $95 million and exports of software with $87 million.
The sitting government is focusing on promoting the IT industry and the digitization of the economy. For that purpose, the government allowed IT companies to retain 35 percent of export earnings in foreign currency accounts for the purpose of expansion of their business.
A target of $5 billion has been set for the annual remittances of IT exports in the next three years.