IT exports hit $1.9 billion in nine months of FY22

KARACHI: Country’s IT exports jumped to $1.9 billion in nine months of this fiscal year, contributing 38 percent to the overall services’ export and marking a 29 percent year-on-year rise, the central bank data showed on Saturday.

In March, the technology exports stood at $259 million, compared with $209 million in the corresponding month of the last year.

It witnessed a month-on-month (MoM) increase of 29 percent, while 24 percent year-on-year (YoY).

Total services exports rose 20 percent YoY to $668 million in March. These exports increased 17 percent to $5.156 billion in July-March FY2022.

The upward trend in the IT exports is a positive sign for the country’s trade and the current account deficit, as it’ll contribute to increasing foreign exchange earnings.

The growth in the technology product and services exports has remained on a higher side since the pandemic period that induced a surge in freelancing activities.

The support for remote work and

e-learning arrangements in Covid-19 boom period and even after the pandemic-related instructions eased in many countries contributed to a rise in information and communication (ICT) exports.

Within ICT, exports increased across almost all segments, including software consultancy, call centers and telecom services during the period.

The government as well as the State Bank of Pakistan (SBP) is actively working to promote this rapidly growing services segment, including via facilitating receipt of export earnings and tax rebates and incentives.

According to SBP’s first quarterly report on Pakistan’s economy for FY2022, country’s digital services firms and tech entrepreneurs are consistently increasing their exports and are now also benefiting from the sharp increase in global investments flowing into tech start-ups.

Covid-19 outbreak, social distancing, and containment measures accelerated the trend of digitization, it said.

The SBP, citing a study, said that an estimated 70 million additional people became digital consumers only in the Southeast Asia region after the beginning of the pandemic.

While e-commerce and distant learning platforms were among major avenues for the internet usage, the pandemic also stimulated a drive to digitise a wide range of other services, including financial technology (fintech) and logistics companies.

Many of these services attempt to address structural imbalances in developing countries, in areas like financial inclusion, gender disparity in financial access, and efficiency-lags in the retail sector and in logistical connectivity.

As such, firms offering digital solutions in these areas have become highly sought-after by global investors, and have managed to raise significant amounts of external financing.

As per the report, investments are flowing into start-ups at varying stages of development, including those at the initial stages, and with established customer bases and revenues.