Pakistan IT Exports Surge by 42% Amid Expanding Client Base

Pakistan’s IT sector is witnessing a remarkable surge in exports, growing by 42% year-on-year to reach $292 million in September 2024. This sustained growth began in October 2023. It marks the 12th consecutive month of increasing IT exports. Over the first quarter of the fiscal year 2024-25 (July-September), Pakistan IT exports reached $877 million, a 34% jump compared to the same period last year.

Several factors have been contributing to this growth. The most important among them are the expanding client base in global markets like the Gulf Cooperation Council (GCC) and enhanced retention policies for exporters. The State Bank of Pakistan’s (SBP) decision to increase the permissible retention limit from 35% to 50% in Exporters’ Specialised Foreign Currency Accounts has provided increased flexibility to IT firms for managing their profits. Moreover, the stabilization of the Pakistani rupee has made it more advantageous for these companies to repatriate earnings, further boosting Pakistan’s foreign exchange reserves.

Pakistan IT Exports Boom: 42% Growth Amid Global Expansion

The active participation in international tech events such as London Tech Week 2024, Collision Canada, and Black Hat USA also supported the growth of Pakistan’s IT sector. By engaging with global tech leaders, local IT companies are expanding their client networks.

A fundamental development for IT exporters in the 2024-25 financial year was the introduction of the SBP’s new category of Equity Investment Abroad. This provision permits export-oriented IT companies to acquire shareholding in overseas entities, using up to 50% of their foreign currency proceeds. According to Industry insiders, this move will significantly increase the confidence of IT exporters and encourage them to remit more profits back to Pakistan.

Despite the ongoing issue of slow internet speed in the country, which hinders productivity, IT firms have been making extra efforts to provide high-quality services. According to industry expert Dr. Noman Ahmad Said:

“Pakistan’s IT companies have demonstrated resilience and creativity in navigating these challenges. The target is to push monthly IT exports to $300-$350 million in the coming months.”

Furthermore, net IT exports for September 2024 rose by 56% year-on-year to $255 million. This figure is also higher than the 12-month average of $245 million, further emphasizing the sector’s growing strength. Projections for fiscal year 2024-25 claim that Pakistan’s IT exports will continue their upward trajectory. A 10-15% increase is anticipated bringing the total to approximately $3.5-$3.7 billion. Government initiatives play an important role in sustaining the IT sector by facilitating the business environment, coupled with growing interest from international clients.

In a recent statement, Minister of State for Information Technology and Telecommunication Shaza Fatima Khawaja applauded the sector’s remarkable growth. Furthermore, she reiterated the government’s commitment to subsidizing IT exports and improving Pakistan’s digital infrastructure.

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