The Ministry of Information Technology and Telecommunication (MoITT) has warned the government that on account of non-implantation of agreed incentives, lack of consistency in policies as well as resolving the tax and banks related issues, the telecom sector exports remittances may further decline besides compromising its digital vision.
Official sources told ProPakistani that the latest decline in the IT and IT-enabled Services (ITeS) export remittances rung the alarm bill and serious reservations were expressed among the concerned quarters.
The ITeS exports declined by 0.3 percent during the first quarter of the current fiscal year 2022-23 and stood at $633 million compared to $635 million during the same period of the last fiscal year.
The State Bank of Pakistan (SBP) data shows that ITeS exports remittances declined by around 10 percent on a month-on-month (MoM) basis in September 2022. On a year-on-year (YoY) basis, the export remittances decreased by over 4 percent.
Sources said that Finance Minister Ishaq Dar chaired a meeting of the Prime Minister’s Task Force on Information Technology (IT) and Telecom, where serious reservations were expressed about the decline in remittances.
In light of the directions of the Prime Minister, a meeting was convened between SBP and Federal Board of Revenue (FBR) representatives and MoITT, Pakistan Software Export Board (PSEB), and Pakistan Software House Association (P@SHA) teams under the Chairmanship of SAPM for Youth Affairs Shaza Fatima.
MoITT sources said that the meeting discussed issues of the sector at length with a positive outcome on both tax and banking regimes for the sector. FBR was forthcoming to resolve issues of the information and communication technology (ICT) sector with assurance to ensure the resolution of issues being faced by IT companies and freelancers including policy and operational matters.
Further, the SBP assured the early resolution of 35 percent USD amount retention in foreign currency (FCY) accounts and its repatriation by IT/ITES companies.
A meeting was immediately held between SBP, MoITT, P@SHA, and commercial banks to address operational issues being faced by the IT sector at commercial banks for availing the above facility.
Sources said that the meeting was informed that MoITT has been pursuing steps for facilitating the sector.
The IT minister has raised the issues being faced by the sector in different meetings including the one held with Prime Minister in the chair. The minister has warned that the sector may face further decline if immediate attention was not paid.
