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Business Recorder
10-06-2025
- Business
- Business Recorder
IT, ITeS export remittances surge by 23.7pc
ISLAMABAD: Pakistan's information technology and IT-enabled services (ITeS) export remittances including computer services and call centre services, increased by 23.7 percent to US 3.825 billion dollars during July to March of the fiscal year 2025, marking the highest trade surplus among all service sectors at US 2.4 billion dollars, the Economic Survey 2023-24 noted. The sector reached a total of $2.825 billion in export remittances from July to March FY 2025, reflecting a 23.7 percent increase compared to $2.284 billion during the same period of the previous fiscal year, the survey mentioned. In March 2025 alone, ICT export remittances were recorded at $342 million, marking a 12.1 percent rise from $305 million in February 2025. On a year-on-year basis, this also represents an 11.7 percent increase compared to $306 million recorded in March 2024. The Economic Survey highlighted that IT and ITeS industry achieved a trade surplus of $2.429 billion, the highest among all service sectors, growing by 21.6 percent from the $1.997 billion surplus during the corresponding period last year. In stark contrast, the overall services sector posted a trade deficit of $2.318 billion during the same period, further highlighting the ICT industry's vital role in balancing national service accounts. Freelancers based in Pakistan also made a substantial contribution by earning $400 million in foreign remittances during July–March FY 2025. According to the Ministry of Information Technology and Telecommunications, this impressive performance stems from concerted efforts by the Pakistan Software Export Board (PSEB), in coordination with the Special Investment Facilitation Council (SIFC) and key industry stakeholders. These efforts focused on facilitating international market access, supporting digital infrastructure, and enhancing ease of doing business for IT firms. As of March 2025, more than 30,000 IT and ITeS companies were registered with the Securities and Exchange Commission of Pakistan (SECP), reflecting a steady expansion in the formal IT sector. The survey further attributed that the PSEB is executing an ambitious plan to launch 250 e-Rozgaar centres nationwide by FY 2027 under the PSDP project 'Prime Minister's Initiatives – Support for IT Startups, Specialised IT Training, and Venture Capital.' By the end of FY 2025, 50 of these centers are expected to be operational, with a projected target of creating 20,000 new jobs. Currently, more than 50 Software Technology Parks (STPs) and e-Rozgaar centres are operational across primary and secondary cities including Karachi, Lahore, Islamabad, Faisalabad, Quetta, and Gilgit, hosting over 350 IT companies and 4,600 professionals, of which 21 percent are women. In FY 2025 (July–March), over 6,400 IT professionals were trained in advanced and emerging technologies, while 2,700 interns were placed in IT firms, maintaining a high 70 percent retention rate. Additionally, 15 IT firms received international certifications such as ISO 27001 and ISO 27701, while 20 call centers achieved ISO 18295 certification —enhancing Pakistan's global competitiveness in the outsourcing market. The IGNITE-National Technology Fund continued its mission of fostering innovation and entrepreneurship. The National Incubation Centers (NICs) have now incubated over 1,900 startups, out of which 960 have graduated, collectively generating over 185,000 jobs, attracting investments of Rs 30.8 billion, and reporting revenues exceeding Rs 27.3 billion. More than 12,000 women entrepreneurs have been empowered through these programmes. The 2.0 programme has provided over 4.55 million trainings, including to 50,000 overseas Pakistanis, enabling freelancers in the country to earn a cumulative $1.65 billion by December 2024. PSEB also ramped up global outreach during FY 2025, subsidizing the participation of 256 IT companies in 15 international and 2 local events, yielding over $48 million in business leads. The 'TechdestiNation Pakistan' campaign was actively promoted, including the launch of the TechdestiNation Podcast, highlighting success stories and emerging leaders in the sector. To meet the ambitious target of achieving $15 billion in annual ICT exports in the coming years, the government continues to focus on skills development, ease of business, and international partnerships. Copyright Business Recorder, 2025
Business Recorder
09-06-2025
- Business
- Business Recorder
Pakistan's IT sector surges with 24% export growth, $2.4bn trade surplus
Pakistan's Information Technology sector delivered a standout performance in FY2025, with exports of ICT services surging by 23.7% during July–March to $2.825 billion, according to the Pakistan Economic Survey 2024-25. This growth added a much-needed boost to the country's external sector, as IT and IT-enabled services (ITeS) recorded a $2.4 billion trade surplus – the highest among all service industries. Freelancers played a notable role in the sector's performance, contributing $400 million in foreign exchange earnings, underlining the increasing relevance of the digital gig economy in Pakistan. The momentum continued into March 2025, when ICT exports reached $342 million, up from $305 million in February, marking a 12.1% month-on-month increase and an 11.7% year-on-year growth from March 2024. To support and sustain this upward trend, the government is expanding digital infrastructure and promoting entrepreneurship. The Pakistan Software Export Board (PSEB) has initiated the rollout of 250 e-Rozgaar centers by FY2027, aiming to create 20,000 jobs and support freelance work and startup culture. Fifty centers are expected to be operational by the end of FY2025. Additionally, over 1,900 startups have been incubated under the National Incubation Centers (NICs), with 960 graduating successfully. These ventures have generated over 185,000 jobs, attracted Rs30.8 billion in investments, and reported combined revenues of Rs27.3 billion. Over 12,000 women entrepreneurs have been empowered through these initiatives, reflecting the sector's contribution to inclusive growth. On the telecom front, the sector generated Rs803 billion in revenues during July–March FY2025, while contributing Rs271 billion to the national treasury through taxes and duties. Total subscriptions reached 199.9 million, pushing teledensity to 81.3%. The sector's expansion is being supported by international collaboration, including a Joint Working Group (JWG) with China, focusing on ICT infrastructure, cybersecurity, innovation, and regulatory frameworks.
Express Tribune
02-06-2025
- Business
- Express Tribune
P@SHA Chairman urges government not to introduce any new taxes for IT
The Pakistan Software Houses Association (P@SHA) has called on the federal government to not introduce any new taxation and a business-friendly package for the country's information technology sector in the upcoming fiscal budget, set to be presented on June 10. In a statement to the media, P@SHA Chairman Sajjad Mustafa Syed disclosed that of the $700 million invested in Pakistan's IT industry, $600 million originates from companies affiliated with the association. He emphasised the sector's dependence on stability, consistent policies, and supportive incentives to ensure continued growth. 'We are urging the government to implement a fixed tax regime for the next ten years, from 2025 to 2035, and to commit to this in the FY26 budget,' said Syed. Syed also advocated for the continuation of the 0.25 percent withholding tax rate for companies registered with the Pakistan Software Export Board (PSEB) beyond 2026 under the proposed fixed tax system. Highlighting a disparity in tax rates within the sector, he pointed out that remote IT freelancers face a tax rate of only 1 percent, while salaried employees may pay up to 35 percent in income tax. Syed called on the government to harmonise tax treatment across employment categories in the industry. He also underscored the need to ease the transfer of foreign currency revenues, warning that inconsistent policies may hinder foreign direct investment in Pakistan's tech ecosystem. 'Without decisive, pro-business reforms, nearly 600,000 jobs in the IT sector could be jeopardised,' he cautioned.
Express Tribune
13-03-2025
- Business
- Express Tribune
P@SHA calls for 10-year tax exemption to boost IT exports
Listen to article The Pakistan Software Houses Association (P@SHA) has urged the government to restore a 10-year tax exemption under the Final Tax Regime (FTR) for IT and IT-enabled services (ITeS) exports from 2025 to 2035 to ensure predictability, continuity, and investor confidence. The IT industry is currently attracting major investments, experiencing operational expansions, and achieving regional diversification in export markets. The FTR allows for a reduced withholding tax rate of 0.25% on export proceeds for entities registered with the Pakistan Software Export Board (PSEB) until the specified date. Therefore, the continuation of the FTR is imperative for sustaining export growth and investment momentum in the IT industry. The FTR for IT and ITeS is set to expire on June 30, 2026. A 10-year tax exemption will accelerate digital transformation, boost investor confidence, and position Pakistan as a leading IT hubaligning with the objectives of the Special Investment Facilitation Council (SIFC) and the prime minister's vision for exponential IT export growth. The continuation of the FTR will simplify tax structures for IT firms and encourage reinvestment by allowing exporters to retain more revenue for business expansion and technological innovation. Additionally, providing tax incentives and ensuring policy-level consistency is essential for creating a favourable business environment for the IT/ITeS industry. P@SHA Chairman Sajjad Mustafa Syed explained that reinstating the FTR for IT and ITeS exports would align Pakistan with regional competitors offering long-term tax incentives to attract foreign direct investment (FDI). The IT sector requires stability and consistency to maintain global competitiveness, increase exports, and create employment opportunities. He maintained that disparities in taxation between salaried employeeswho pay between 5% and 35% in income taxand remote workerswho pay only 0.25% to 1%lead to talent migration, brain drain, and difficulties for local companies in retaining skilled IT and tech professionals. To unlock the industry's full potential, he said, the government must significantly reduce income tax rates for salaried individuals in IT companies. One of P@SHA's key recommendations is to encourage and enable foreign exchange repatriation. Under the current Income Tax Ordinance (ITO), 2001, payments made to non-residents for services rendered in Pakistan are subject to an unfair withholding tax (WHT). Withholding tax rates vary depending on the nature of the payment and the existence of Double Taxation Agreements (DTAs) between Pakistan and the recipient's country. For instance, royalties and fees for technical services paid to non-residents without a permanent establishment in Pakistan are subject to a 15% withholding tax. Saad Shah, an IT exporter and CEO of Hexalyze, urged the government to allocate a budget to support IT-exporting companies exploring emerging and high-potential markets, including Saudi Arabia, the UAE, Qatar, and Singapore. He explained that these markets are investing billions of dollars in various IT sectors, including AI, robotics, cybersecurity, and fintech, offering significant revenue opportunities for service providers. Pakistani exporters have showcased their products and services in recent months and received an encouraging response, he said. The government should also continue enhancing trade relations at the state level through the Ministry of Information Technology and Telecommunication (MoITT), the Pakistan Software Export Board, economic attachés, and diplomatic missions to promote IT business, boosting exports and investment opportunities.
Express Tribune
14-02-2025
- Business
- Express Tribune
MoITT sets up 43 software tech parks
Listen to article The Ministry of Information Technology and Telecommunication (MoITT) through the Pakistan Software Export Board (PSEB) has established 43 Software Technology Parks (STPs) across the country, including in Tier-II and Tier-III cities. These parks host over 350 IT and IT-enabled Services (ITeS) companies, employing 18,000 professionals across a combined covered area of 1.9 million square feet. Notably, 20% of the workforce in these STPs consists of women, said an official of the Ministry of IT. These facilities, set up between FY2022-24, are located in Islamabad, Lahore, Karachi, Gilgit, Rahim Yar Khan, Faisalabad, Swat, Quetta, Gujranwala, Sialkot, Abbottabad, Mansehra, Gujrat, Jamshoro, Nawabshah, Gakuch, Bahawalpur, and Khuzdar. The STPs contribute significantly to Pakistan's economy, generating $100 million annually in foreign exchange earnings and $15 million in domestic revenue. To further enhance the country's ICT infrastructure, a state-of-the-art IT Park is under development in Karachi, covering 1.12 million square feet. Expected to be operational by 2027, the $186 million project will create 13,400 jobs and is projected to boost IT exports by $90 million. Similarly, an IT Park in Islamabad, covering 720,000 square feet, is currently under construction. Scheduled for completion in 2025 at $88.4 million, it is expected to generate 7,500 jobs and increase IT exports by $70 million. As part of its digital empowerment initiatives, the government plans to establish 250 e-Rozgaar centres across Pakistan over the next three years (by 2027) under the Public Sector Development Programme (PSDP) project, "Prime Minister's InitiativesSupport for Startups, Specialised IT Trainings, and Venture Capital."
