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September 20, 2019

Pakistan loses billions in IT imports by looking past local cyber stars

Business

September 20, 2019

KARACHI: Pakistani institutions and agencies import IT infrastructure and cyber-security solutions worth a fortune every year, while there are homegrown enterprises, delivering world-class cyber services to a number of governments around the world and even the US, an industry official said on Thursday.

“Pakistan-based IT firms are serving agencies like US National Aeronautics and Space Administration and other governments to protect them against cyber threats, while our financial institutions and security agencies spend billions of dollars to import the same," said Syed Ahmed,” Chairman Pakistan Software House Association (PASHA), at the 17th e-banking conference.

The one-day conference that had two panel discussions on “Developing Trust in Digital Banking” and “Branch Transformation: How Much Digital is Enough?”, was organised by Total Communications at a local hotel. Ahmad said it was time when the local stakeholders i.e., the government, security agencies, and financial institutions reposed trust in their own IT firms. “They are having the world class expertise and capable enough to help fighting against cyber threats and deliver other technology driven solutions,” he said.

The incumbent government is striving hard to increase its exports, reduce imports, and create import substitutes to create a balance between its foreign earning and income with the prime objective of narrowing down the current account deficit (CAD), said the PASHA chairman.

“The local IT firms may fulfill the purpose in Naya Pakistan, as they are capable of helping reducing software imports worth billions of dollars, while having the potential to export IT infrastructure and software worth around $10 billion per year,” Ahmed said.

Naeem Zamindar, Adviser for Digital Transformation at World Bank, said,” The World Bank has planned to hold a summit of 20 key stakeholders in Pakistan sometime next month to figure out as how to transform the country into a digital world”.

The World Bank aims at preparing a roadmap for fast digitalising Pakistan at the summit and wants the government to create an enabling environment for the private sector to let them do wonders, as world experiences suggest digitalisation does help documenting and promoting economies and collecting higher revenues, the largest immediate challenge to Pakistan, Zamindar said.

“In my mind and heart, I am clear that Pakistan’s future lies in technology-led revolution,” he said. Dato' Arif Siddiqui, Head of Digital Banking at Faysal Bank, said,”What is happening in the financial and digital domains around the world exactly does not fit to Pakistan. Before going for digital financial inclusion, Pakistan first must ensure financial inclusion of the adult population,” he said.

Siddiqui said expanding the network of physical banking facilities was right now more important than going on into a branchless banking hyperdrive in Pakistan. "Majority of the people understands physical banking more than the digital banking in Pakistan," he said.

He said the ratio of physical bank branches per one million people was one of the lowest in Pakistan compared to the region and other parts around the world.

“There are only 16 branches to serve one million people in Pakistan. Contrary to this, there are 165 branches for each one million people in India, over 200 branches in Bhutan and over 300 branches in Europe for each one million people,” Siddiqui said.

Sharjeel Shahid, Group Executive Digital Banking Group at UBL, said, “The delivery of customers' need-based services through using data analytics can help bankers develop people’s trust in digital banking”.

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