Sunday January 29, 2023

P@SHA seeks SBP, FBR support for IT exports growth

By Our Correspondent
January 26, 2023

LAHORE: Pakistan Software Houses Association (P@SHA) on Wednesday said the country could achieve an ideal growth in IT exports once relevant departments such as the State Bank of Pakistan (SBP) and the Federal Board of Revenue (SBP) support the industry with better policies and regulatory measures.

“IT exporters are young, energetic, highly-skilled, and supremely-motivated professionals. Taxation authorities must not treat them with their usual arm-twisting tactics or must not entangle them in unnecessary regulatory hassles,” P@SHA chairman Zohaib Khan said.

Ensuring ease of doing business was the way forward for the growth of the industry, he added.

P@SHA chief stated that Prime Minister Shehbaz Sharif himself was heading a high-level committee on the country’s digital economy, and had made the software houses association a part of it.

Criticising over the SBP, Zohaib Khan said the prime minister had advised the central bank to ensure commercial banks to allow 35 percent retention of foreign currency into special foreign currency accounts. The facility was made mandatory for the banks to remove any discretion exercised by the banks.

“However, commercial banks have made the facility mandatory for the companies as well even if companies do not wish to retain forex,” he claimed, adding the situation had created a panic in the industry about an uncertainty of the policy and its implementation.

He further said the SBP had mentioned a timeline of the facility by March 31, 2023. “It’s too short a time period for its implementation and adoption by the banks and exporters, let alone fair assessment and industry trust-building.”

Zohaib Khan apprised that the PM had given a commitment to ensure implementation of corrective policy measures, however, there was hardly any compliance by the regulatory authorities, he lamented.

“FBR has started issuing notices to the IT companies on super tax that too on very short deadlines.”

The timeline mentioned on the notices was not as per the law and thus created uncertainty and anxiety in the tech ecosystem, according to P@SHA chief. “If the target given by the prime minister has to be achieved, the policy measures recommended by P@SHA and the IT industry must be implemented in true letter and spirit.”

He emphasised that Pakistan needed to manifest itself as a favourable tech destination but a consistent lack of support by relevant departments was hindering achieve the export growth target given by the prime minister.

“In an environment which lacks support and facilitation despite assurance by the highest authority, the export remittances are only going to decrease, let alone maintaining a status quo.”

P@SHA chief stressed that IT and ITeS sector could help the country in efforts to bridge the current account deficit and stabilise the economy.