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Pakistan’s IT exports rise by 9% in November

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11 months ago

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  • IT exports surge to 12-month high to $259m in Nov. 
  • Surge is due to relaxation of permissible retention limit.
  • Computer services grow by 14% month-on-month.

KARACHI: Pakistan’s information technology (IT) exports surged by 9% month-on-month to $259 million in November, which is also the highest level in the past 12 months, The News reported on Friday. 

According to brokerage firm Topline Securities, the jump is driven by a relaxation in the permissible retention limit by the State Bank of Pakistan (SBP), which allowed IT exporters to keep 50% of their foreign earnings in their specialised accounts, up from 35% previously.

A stable rupee also encouraged IT companies to repatriate their foreign income and deposit it in local accounts. Caretaker IT Minister Umar Saif said that IT companies had parked an estimated $1-2 billion outside of Pakistan, which could be brought back to boost the country’s foreign exchange reserves.

The IT export figure reflects the amount remitted back to Pakistan by technology companies, which provide services such as software development, web design, data processing, and call centres to clients worldwide.

Computer services, which accounted for 83% of the total IT exports in November 2023, grew by 14% month-on-month and 20% year-on-year, while telecom services, which made up 17%, declined by 11% month-on-month.

Other computer services, such as consulting, training, and maintenance, recorded the highest growth rate of 28% month-on-month, followed by the export of computer software, which increased by 14% month-on-month.

In the first five months of the fiscal year 2023-24 (July-November), IT exports rose by 6% year-on-year to $1.2 billion, representing 7.4% of the total exports of the country. Net IT exports, which deduct IT imports from IT exports, also increased by 11% month-on-month and 7% year-on-year to $226 million in November 2023.

On a trailing 12-month basis, net IT exports reached $2.4 billion, up by 10% year-on-year.

The IT sector is expected to benefit from the global and regional trends of increasing spending on software and IT services, as per a report by Gartner, a technology research and consulting firm.

Gartner projected that worldwide spending on software would grow by 13.8% and spending on IT services would increase by 10.4% in 2024.

MENA (Middle East and North Africa) software spending was forecast to record double-digit growth of 12.3% in 2024, followed by IT services spending growing at 11.1% next year, to accelerate digitalisation and automation in the region.

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Irfan Siddiqui meets with the PM and informs him about the Senate performance of the parliamentary party.

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The head of the Senate’s Foreign Affairs Standing Committee and the PML-N’s parliamentary leader paid Prime Minister Muhammad Shehbaz Sharif a visit in Islamabad.

Senator Irfan Siddiqui gave the Prime Minister an update on the Parliamentary Party’s Senate performance.

Additionally, Senator Irfan Siddiqui gave the Prime Minister an update on the Senate Standing Committee on Foreign Affairs’ performance.

He complimented the Prime Minister on his outstanding efforts to bring Pakistan’s economy back on track and meet its economic objectives.

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SIFC Increases Direct Foreign Investment: Investment in the Energy Sector Rises by 120%

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The Special Investment Facilitation Council is intended to help Pakistan’s energy sector attract $585.6 million in direct foreign investment in 2024–2025. The amount invested at the same time previous year was $266.3 million.

This is a notable 120% rise, mostly due to investments in gas exploration, oil, and power. Such expansion indicates heightened investor confidence and emphasizes the development potential in important areas.

The State Bank reports that foreign investment in other vital industries has increased by 48% to $771 million.

This advancement is a blatant testament to SIFC’s efficient investment procedure and quick project execution.

The purpose of the Special Investment Facilitation Council is to establish Pakistan as an investment hub by aggressively promoting regional trade and investment in the energy sector and other critical industries.

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Discos report losses of Rs239 billion.

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When compared to the same period last year, the data indicates that discos have decreased their losses in the first quarter of the current fiscal year.

The distribution businesses recorded losses of Rs239 billion in the first three months of the current fiscal year, a substantial decrease from the Rs308 billion losses sustained during the same period the previous year.

Additionally, the distribution businesses’ rate of recovery has improved. It has increased to 91% in the first quarter of this year from 84% in the same period last year, indicating success in revenue collection.

Regarding circular debt, the Power division observed a notable change. Last year, between July and October, the circular debt grew by Rs301 billion. Nonetheless, this year’s first four months saw a relatively modest increase in circular debt, totaling about Rs11 billion.

These enhancements show promising developments in the electricity sector’s financial health in Pakistan, where initiatives are being made to accelerate recovery rates and slow the expansion of circular debt.

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