Why we Need to Invest More in Technology?
Countries around the globe are investing more and more in the IT sector to accelerate their economy. There are numerous government branches across the globe set up entirely with tech development in mind – Silicon Valley was built on public funds for the sole reason of tech expansion. Technology stocks offer investors a lot of profitability in fact; the sector offers the highest returns of all ranked market sectors.
Why we Need to Invest More in Technology?
According to the United Nations E-government Survey 2018, Pakistan has shown incredible improvements in e-presence and provision of public service online. During the FY 2016-17, Pakistan’s IT & ITeS exports have grown at a swifter pace than India and Sri Lanka. Pakistan’s growth rate during the FY 2016-17 was 16%, whereas India’s growth rate was 8% and Sri Lanka’s growth rate was 5% in the respective year. According to the ministry of Pakistan, over the previous five years, Pakistan’s IT industry has been growing rapidly at a rate of 150%.
Pakistan’s share of global IT sales is $2.8 billion, out of which $1.6 billion accounts for the country’s exports of software and IT-enabled services. One of the world’s best payment processing solutions providers i2c resides right here, in Pakistan.
Pakistan’s growth rate during the FY 2016-17 was 16%, whereas India’s growth rate was 8% and Sri Lanka’s growth rate was 5%
Convo, the hot favorite social network for work, is although not based in Pakistan but is developed by Pakistanis. Pakistan has more than 25 tech incubators, accelerators, and co-working spaces. Civic Hackathons, Startups Weekends, Startup Expos, Digital Youth Summits, and other such events are producing the next generation of tech entrepreneurs and startups in Pakistan.
Because of the technology growth, Pakistan is also getting popularity internationally. According to FY-2017-18 annual report, Foreign Direct Investment in Pakistan’s business of Information Technology has escalated to $1.9 billion. A huge share of this investment has been coming from foreign financiers extending from the UAE to Egypt, the US, and China.
The government’s incentives to the IT & ITES industry include tax exemption on IT exports, 100% foreign ownership, 100% repatriation of capital and dividends, 3-year tax exemption for IT startups and the tax holiday for venture capital funds till June 2024. The exports earning of the IT industry registered a double-digit growth of 19 percent or $150 million from the financial year 2015-16 which stood at $788.640 million. Exports of ICT services are mostly delivered to countries and regions such as USA, Middle East, and South African countries. Pakistan Software Export Board (PSEB) which is an apex government body designated to promote IT growth and to make policy suggestions, reported 3 times higher exports as compared to SBP’s numbers ($2.81 billion) through the input of various companies/software houses.
Technology changes quickly, and one-time leaders can quickly fall behind, or even go out of business. In addition, promising emerging companies may make a tremendous splash, only to fade out quickly. Undoubtedly, the Pakistani government is trying hard to make the IT sector more profitable. However, there are still some areas in which Pakistan can invest to promote its technology sector.
Artificial Intelligence (AI):
Although Pakistan is tremendously improving its IT sector there are still some areas that require meticulous attention from the government so that investment in such areas could boost IT sector, one of them is AI. Pakistan has already been working on it and launched many technology startups and services to boost the AI in Pakistan.
Pakistan is one of those countries where smartphone penetration rate is rapidly growing.
Technology changes quickly, and one-time leaders can quickly fall behind, or even go out of business. Promising emerging companies may make a tremendous splash, only to fade out quickly
The launch of 3G/4G services has helped digitize the country’s IT sector. However, we still do not manufacture smartphones in our own country. Our government should facilitate smartphone manufacturing companies to encourage them to set up their businesses in Pakistan.
While blockchain has gotten a lot of publicity as it’s the technology behind Bitcoin and other virtual currencies, it’s more than just an alternative payment method.
Pakistan’s share of global IT sales is $2.8 billion, out of which $1.6 billion accounts for the country’s exports of software and IT-enabled services
The blockchain is the digital, distributed, and decentralized ledger tethered to most cryptocurrencies that are responsible for recording all transactions without the need for a financial intermediary.
Companies including technology leaders like Alphabet subsidiary Waymo, Tesla and most major auto manufacturers are working on creating self-driving cars. In most places, that’s not even legal yet, but some driver-assist technology has already entered the market, and it’s likely that self-driving cabs and even trucks will be in at least limited use reasonably soon.
The Internet of Things (IoT): The IoT is the network of devices connected to each other and the cloud. It includes everything, from a smart thermostat that can adjust the temperature in your home to complex medical equipment that can order its own repairs.
The cloud is a system of computer storage that allows information and services to be accessed by devices from anywhere. It allows companies (and individuals) to use services to store data on space outside their tangible devices. Amazon, Google, IBM, and Microsoft are all major cloud players.
Pakistan is one of the hottest regions for Startups. The involvement of government in the technology sector will contribute to an increasingly competitive sector, which will, in turn, encourage the development of better products and services
The government has already established several entrepreneurship centers including Plan9, PlanX, TechHub. But investing more in this field will help to accelerate the country’s economy.
It is also time for Pakistan to seriously invest in the research and development (R&D) sector which acts as the backbone of a globally competitive, knowledge-driven economy. Investment in the R&D sector can lead to the development of new products and services driving growth, creating jobs, and improving national welfare.
The involvement of government in the technology sector will contribute to an increasingly competitive sector, which will, in turn, encourage the development of better products and services. By supporting national businesses, a government can strengthen its political and economic position on the global stage.
The government needs to formulate the policies and guidelines to augment the national businesses in international markets
In order to do that, the government needs to formulate the policies and guidelines to augment the national businesses in international markets. That way, private businesses will happily invest in local tech scene which will benefit our industry and our country.