The information technology (IT) sector’s export volume only increased by a pitiful 5% in November compared to the same month last year, despite being completely exempt from the time-consuming procedure of obtaining Letters of Credit (LCs) and not being dependent on imports for its raw materials (YoY). Analysts attribute this low figure to the government’s disregard for nontraditional export industries.
An official from the Ministry of Information Technology and Telecommunication said, Globally, IT companies exports grow in hundreds and thousands of times, a potential that Pakistan has in abundance but cannot tap into due to inconsistent policies. The cooperation of the finance ministry, Federal Board of Revenue (FBR) and State Bank of Pakistan (SBP) is crucial in this regard.
Any suggestion given to them by our ministry, however, is ignored, said the official, lamenting that, People in the government do not understand the export potential held by the IT sector.
According to a Topline Research report by IT Analyst Nasheed Malik, Pakistans IT exports for November 2022 increased by 5% YoY to $233 million due to a 29% jump YoY in telecom services. The exports also increased by 5% month-on-month (MoM) due to a 15% MoM increase in telecom services and 3% MoM in computer services.
The latest export number is also above the six-month rolling average of $221 million. Exports, however, are down by 10% from a peak of $260 million recorded in March 2022 but managed to cross the $230 million mark set in June 2022, said Malik.
On a larger scale, however, there has been a downturn, with YoY growth averaging just 6% from June to November 2022, down from an average YoY increase of 17% from December to May 2022. The IT Ministry has set an export target of $3 billion for FY2023, said Malik, adding that, With a current fiscal year monthly average rate of $217 million and a six-month rolling average of $221 million, there are concerns about whether Pakistan will be able to achieve the set target.