Pakistan’s IT Exports Increase YoY But Fell by 27% in May
Pakistan’s IT sector is developing at a gradual pace. In the last couple of years, our IT exports have seen impressive growth. However, still, we lag far behind other nations such as India whose IT exports have crossed the $200 billion mark. Furthermore, in the recent fiscal budget, the IT industry had been neglected and no new development schemes have been announced.
Consequently, Pakistan’s IT exports witnessed a decline of 27% month over month in May to reach their lowest level monthly since February 2021. According to data from the State Bank of Pakistan, IT exports were down from $249 million a month earlier to $183 million in May.
Pakistan’s IT Exports Increase YoY
Furthermore, in May 2021, the nation exported technology-related goods and services valued at $198 million. In the first eleven months of the current fiscal year, the technology sector exported goods and services worth $2.4 billion, representing a 25 percent increase year over year and a 38 percent contribution to the total export of services. The total value of services exported in May decreased by 20% MoM to $514 million. However, exports rose 18% to $6.318 billion from July to May of FY2022.
Monthly Fall Because of Prolonged Eid Holidays:
The country’s foreign exchange earnings have increased thanks to the IT companies’ strong export performance, but the monthly fall in their export statistics in May is not a good sign for the trade and current account deficits of the nation. It has been claimed that the prolonged Eid holidays are to blame for the drop in IT exports.
Post-Pandemic IT Boom:
Since the pandemic, the expansion in the nation’s exports of technological goods and services has continued to be higher, which has aided in freelancing activities as well. The increase in information and communication (ICT) exports can be attributed to the support for remote working and e-learning arrangements during the Covid-19 boom period and even after the pandemic-related restrictions loosened in many nations of the world.
Almost every industry under ICT saw a growth in exports, including software consulting, call centers and telecom services. Both the government and the SBP are aggressively promoting this quickly expanding services sector, particularly by easing the receipt of export revenues as well as tax breaks and incentives.
According to the central bank’s first quarterly report on the condition of the Pakistani economy for FY2022, digital service providers and tech entrepreneurs in Pakistan are steadily growing their exports and are now also reaping the benefits of the strong rise in foreign investment in tech startups.
The Covid-19 epidemic, the ensuing social exclusion, and the containment efforts that followed have had significant effects, one of which is the acceleration of the digitization trend.