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ISLAMABAD: The Ministry of IT and Telecommunication is all set to launch Pakistan’s first-ever National IT and ITes export strategy on Thursday (today) envisaging to attain an annual export target of $ 10 billion in the next three years from the current around $ 2.6 billion.

The caretaker federal minister for IT and Telecommunication, Dr Umar Saif, will unveil the ambitious roadmap to attain an annual export target of $ 10 billion through several key dimensions.

The minister said that the strategy has been developed in collaboration with a top-tier international consulting firm — PricewaterhouseCoopers (PwC) — for the Pakistan Software Export Board (PSEB). This is our roadmap for increasing Pakistan’s IT exports by $ 10 billion per year, he added.

The $ 10 billion IT exports in next three years would include $ 5 billion by 0.2 million additional IT workforce, $ 3 billion by 10000 e-rozgar freelancing centers, $ 1 billion by dollar retention accounts to facilitate foreign currency remittances to Pakistan and $ 1 billion by Pakistan Startup fund.

Official sources revealed that the government is trying to convince PayPal, stripe, and RISE to come to Pakistan and provide these services to the freelancer community. Further, the government is planning to provide interest-free loans to freelancers for establishing e-working centres.

As per the proposed plan, each freelancer would receive financial assistance of Rs 100,000 to set up their own e-working centre. The initiative was aimed at addressing the challenge of lack of suitable workplaces for freelancers so that they could work in a conducive and peaceful environment, he added. Each freelancer could earn up to $ 30,000 annually which would significantly contribute to the national economy.

Further, the government was also working for easy access to loans and investments for IT startups, with the expectation of attracting external investments of up to $ 1 billion within the next six months.

The ministry has identified several constraints including inconsistency in policies, taxation issues and banking hurdles which are hampering the country’s information technology sector’s export potential of $ 15 billion.

Over the past five years, phenomenal upward growth of 178 percent in IT and ITeS exports has been realised at compound annual growth rate (CAGR) of 30 percent, the highest growth rate in comparison to all other local industries in services and even higher than the textile sector which stands at 148 percent.

However, a number of constraints and hurdles are hindering the growth of IT and ITeS exports. Inconsistency of policies has eroded the confidence of local and international investors, customers and partners not to mention the trade bodies and government entities. Frequent changes in taxation policy on IT and ITeS export proceeds are one such example.

Taxation issues faced by the IT and ITeS industry are causing unnecessary hurdles and challenges for businesses, as well as, freelancers.

Sources further revealed that banking hurdles and unnecessary restrictions are discouraging exporters from using formal banking channels and encouraging the retention of export earnings abroad. Ease of travel is a necessity to ensure the growth of IT and ITeS exports for both inbound travel of investors/customers/partners/employees from offices abroad and outbound travel of IT executives and professionals.

The lack of skilled human resource is an ongoing challenge for the IT and ITeS industry. With growing international demand, finding the HR with the right skill set and expertise is difficult. The gap between the demand for skilled HR in the IT and ITeS industry and the supply of IT graduates has significantly increased. Higher Education Commission (HEC) accredited institutes are currently producing 45,000 to 50,000 IT-related graduates yearly and less than five percent are employable in export-oriented companies.

The lack of IT-ready infrastructure at affordable rates in major cities, as well as, secondary and tertiary cities is restricting growth of IT and ITeS industry and resultantly exports.

Limited access to access to capital is a necessity for IT and ITeS businesses to expand their operations at both local and international level. Majority of the IT and ITeS businesses are SMEs and lack the capital to grow their businesses.

Limited international marketing, branding, promotion and business development is not enough to become a preferred outsourcing destination in the world. The programs of international marketing and export enhancement need to be expanded at least tenfold with appropriate funding to meet the target of $ 15 billion in IT and ITeS within five years.

Copyright Business Recorder, 2023


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vicky Nov 23, 2023 10:03am
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