IT, ITeS export remittances grow 20.75pc in 11 months

The Information Telecommunication (IT) and IT-enabled Services (ITeS) export remittances comprising computer services and call center services surged to $1.11 billion at a growth rate of 20.75 percent in the first 11 months of fiscal year 2019-2020 (July–May), compared to $917.875 million during the same period of 2018-2019.

This has been revealed in the latest performance report of the Pakistan Software Export Board (PSEB), an organisation functioning under Ministry of IT and Telecommunication. It stated that the Ministry of IT is taking all possible steps to ensure sustainable growth of Pakistan’s IT industry, and to ensure close coordination with the IT industry and associated stakeholders. The generous incentives from the government and various projects to enhance capacity and capability of the IT Industry have resulted in strong industry growth rates.

Incentives to the industry include zero income tax on IT and ITeS exports till June 2025, tax breaks for the PSEB-registered IT start-ups for three years, up to 100 percent foreign ownership of IT and ITeS companies, up to 100 percent repatriation of profits for foreign IT and ITeS investors, tax holiday for venture capital funds till 2024, among other incentives.

Spokesperson of the ministry told Business Recorder that 6,000 Pakistan-based IT companies were providing IT products and services to entities in over 100 countries. Strong inventive are being provided to the IT industry, and there are several projects intended to facilitate and assist IT industry in its growth trajectory, and to ensure continued upward momentum in local and export earnings.

Pakistan was ranked the 3rd-most popular country for freelancing in the world, and Pakistani IT companies are providing products and services to the world’s largest companies. Pakistan’s ICT Industry has been a resounding success story for Pakistan, having achieved a stellar remittance inflow growth rate, and being the largest net exporter in the services sector.

As of May, 2020, IT and ITeS export remittances have surged to $1.11 billion at a growth rate of 20.75 percent in the first 11 months of fiscal year 2019-2020 (July–May), compared to $917.875 million during the same period of 2018-2019.

In view of the possible fallout of the Covid-19 pandemic, the secretary IT directed ensuring close coordination with the IT industry to minimise the impact of the pandemic on the IT industry, and to take all possible steps to ensure maximum facilitation and assistance to the industry during these challenging times. The government has prepared an incentives package for promotion of information technology sector, envisaging increasing IT sector exports from the current around $1 billion to $10 billion by 2023. Information technology is emerging as a vital organ of national economy, and the government is paying great deal of heed to promote IT sector, it is maintained in official documents.

The incentives package includes various measures, and is being designed after a thorough analysis of other important IT destinations of the region such as Philippines, China, Bangladesh, and India.

The Ministry of Information Technology and Telecommunication (MoITT) Secretary, Shoaib Ahmad Siddiqui, told Business Recorder that the government was focused on increasing IT sector exports to $10 billion as soon as possible. All the stakeholders are on board and the target is very much achievable, Siddiqui said. He also confirmed the incentives package, while saying that the government wanted to facilitate that sector, which had huge potential to increase the country’s exports manifold.

A summary to the prime minister is under process to encourage Pakistani products, and to give preference to Pakistani software products by all ministries/divisions, which would help in growth of IT business. Special Technology Zones will be developed in the country to promote IT/ITeS growth.

On the direction of Federal Minister for IT and Telecommunication, Ministry of IT and Telecommunication is continuing its efforts to enhance IT exports and encourage IT companies.

The IT industry has been a star in Pakistan’s economy, and has achieved positive year-on-year growth as a result of strong government support, skilled entrepreneurs, and a talented workforce.

Secretary IT Shoaib Ahmad Siddiqui stated that the PSEB had highly trained and experienced asset in the form of commercial counsellors in important cities around the world, and that they could contribute significantly in projecting Pakistan’s IT and ITeS sector around the globe. He directed the PSEB to engage and utilise the services of Pakistan’s commercial counsellors to enhance Pakistan’s IT and ITeS exports, and for facilitating Pakistan’s IT companies in the overseas markets.