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Information Technology Sector

Overview

Information Technology (IT) sector is one of the sectors in Pakistan which has achieved significant growth over the previous decade. According to the estimates of the Board of Investment, Pakistan, the IT Sector is one of the fastest- growing sectors of Pakistan contributing about 1% to the GDP of Pakistan at about $3.5 billion. During 2018-19, Pakistan's IT exports were $3.5 billion approximately17. It doubled in the past four years and experts expect it to grow a further 100% in the next two to four years to $7 billion18. 

According to the Pakistan Software Export Board (PSEB), there are more than 3000 active IT/ITeS companies, which possess expertise in custom software development, enterprise resource planning (ERP), financial solutions, mobile content, document management, enterprise computing, and business process outsourcing (BPO). 

 

STATISTICS

  •  Over the last six years, Pakistan IT and ITeS Export Remittances have increased by 19% on an average basis. 
  • Enterprise software has grown by 17%, marketing tech 15%, financial services 13%, consumer goods 9%, retail/e-commerce 8%, professional services 8%, internet of things/hardware 7%, health care 4%, media 4%, and non-profit 3%19. 
  • Ranked number four for freelance development in the world. 
  • More than 300,000 English speaking IT professionals with expertise in current and emerging IT. 
  • Pakistan has more than 15 IT parks with IT-enabled infrastructure with more being planned in the future. 
  • With 3G/4G service, over 85% of telecommunication infrastructure on fiber-optic cables and internet access in over 2,000 cities/towns across Pakistan 
  • Pakistan has about 64% of its 230 million population in the 15 to 29 age group. This represents an abundance of human and knowledge capital. 
  • More than 20,000 IT graduates and engineers are being produced each year coupled with a rising startup culture. 
  • In accordance with Pakistan Vision 2025 and the Digital policy of Pakistan 2018, the ICT industry size is targeted to reach $20 billion by 2025. 

 

INVESTMENT OPPORTUNITY

According to a US-based organization, export.gov, Computer Software is the best prospect area in the IT/ITeS sector for investment in Pakistan. The most promising sub-sectors for U.S. companies within the computer software sector for FY-2020 are: 

  • E-commerce 
  • Company Acquisitions and Mergers 
  • IT Parks 
  • Incubators 
  • Venture Funds 
  • Software Companies
  • Call Centers 
  • Gaming and Animation Studios 
  • Data Centers 
  • Training Centers 
  • Consulting Centers

According to Pakistan's Ministry of Finance, during FY 2017-18, the local economy achieved a considerable growth rate of 5.8 percent despite chronic challenges including an energy crisis and terrorism. The local software market offers substantial business opportunities for U.S. companies who offer products for the corporate sector including financial management and business forecasting, online IT training portals, e-commerce, e-payment, embedded tools, and other web-based applications. 

Industry experts expressed optimism about growth prospects in the e-commerce sector, projecting $1 billion in revenue by 2020. Increased use of mobile wallets, coupled with cheaper, more reliable smartphones, has helped increase the user base for Pakistan's e-commerce industry21.  

 

Current Players

  • Netsol- USA -1995 
  • S & P Global Pakistan Pvt Ltd - USA - 2004 
  • TeraData Pakistan - USA - 1995 
  • Mentor Graphics Pakistan - USA - 1999
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