Pakistan’s first-ever IT export strategy report reveals that Pakistan can grow its IT/ITeS export revenues up to $15 billion per annum in the next 5 to 6 years.
According to the report, the growth potential of Pakistan’s IT/ITeS export revenues is from $12 billion to $18 billion annually in the next 5 to 6 years would make Pakistan a global IT Hub.
The IT export strategy report has been prepared by the Pakistan Software Export Board (PSEB) in collaboration with PricewaterhouseCoopers (PwC), and other international partners, including faculty from the University of Oxford.
According to the report, Pakistan has 1 million freelancers, 316,000 IT workforce, 226,000 IT discipline enrollment in higher education institutions, and 12,000 IT businesses that can it an IT hub in the next 5 to 6 years.
This export target can be achieved through a strategy of focusing on five priority IT/ITeS market segments and within those, 12 sub-segments which have a combination of high global market growth, significant global market size, and relatively few established players.
Currently, Pakistan’s IT export destinations are the USA, UAE, UK, Singapore, Canada & Norway. IT Exports to the USA amounted to $1,066 million in the year 2020-21. IT Exports to other countries include $126 million to UAE, $104 million to the UK, $51 million to Singapore, $39 million to Canada, and $36 million to Norway in 2020-21.
The report discloses that the IT sector is a fast-growing export sector in Pakistan, ranking 1st out of 12 services sectors in 2021/22. The Software Development and IT Services segments make up 75 percent of the total IT Industry revenues.
According to the report, 5 priority IT market segments include Software Development, ITES, ITSS, E-Services, and Smart Tech. The 15 priority subsegments that have been identified by the strategy are AI, Blockchain, ERP/CRM Integrations and Revenue Implementation, Cloud computing, LPO AR, VR & MR, E-Healthcare, Digital Twin, Cyber security BPO, E-learning, and E-Education.
The export market growth will be sub-optimal if the macro-conditions in the country are not also made more favorable. The report suggested macro interventions for the facilitation of IT exports in the country. It includes the availability of credit on the basis of customers’ contract/receivables and Subsidized credit for setting BPOs and setup of Pvt equity fund.
Other macro interventions suggested include free mobility of foreign currency earned by freelancers and IT enterprises. Tax legislation and harmonization to provide incentives for both Pakistani and overseas organizations to invest in the Pakistan IT Industry. Increased equity and investment in the IT/ITeS industry, particularly from overseas investors. Improvements in the legal, regulatory, and policy regime.
The report suggests strategic input for the growth of IT Exports which include, skills development for up to 1m people in technical and managerial training, as well as higher education to support the IT/ITeS revenue ambitions and upgrade the quality and extent of the supporting infrastructure which the industry requires, such as reliable high-speed internet connectivity, cloud services and technology parks.