Pakistan Ranks Among World's Top Outsourcing Destination Countries

[Riaz Haq]

Pakistan ranks number 3, after US (#1) and India (#2), in terms of freelancers doing outsourced IT work on contract. Bangladesh ranks fourth, according to data from four biggest online outsourcing sites:  Elance.com, oDesk.com, Freelancer.com, and Guru.com.

The data also shows that US, Australia and the UK as the top hiring countries.

All four websites work in a similar way: First, companies post job requirements on these sites. Next, freelancers or IT-companies offer their bids with skills and cost for the project listed on the website. Finally, the company chooses the best bid meeting its job requirements.

Recently, Freelacers.com, one of the top four online marketplaces, said there are 240,000 freelance Pakistanis registered as providers on its website.

With more than 30 million internet subscribers, five million plus broadband users and a population nearing 200 million, according to Freelancer executive Adam Byrnes, it makes sense to have a presence in Pakistan.

“Going forward, we want to provide self-employment for a billion people, a significant portion of that is going to come from Pakistan,” he told Express Tribune.

In addition to having a large population, Pakistan has seen its human capital grow significantly over the last decade.  With nearly 16% of its population in 25-34 years age group having
college degrees, Pakistan is well ahead of India and Indonesia,
according to Global Education Digest 2009 published by UNESCO Institute of Statistics. UNESCO data also shows that Pakistan's lead is growing with younger age groups.

Faster economic growth requires BOTH skilled manpower and investment of dollars as Pakistanis saw during Musharraf years. Regardless, the growth of human capital is a good thing to build a
foundation for Pakistan's future. It'll contribute to economic growth
when the security situation improves and FDI returns to Pakistan. The
country's large diaspora too will be helpful in accelerating Pakistan's growth and development with money and skills. 

Related Links:

Haq's Musings

Upwardly Mobile Pakistan

Pakistan Among Top Outsourcing Destinations

Pakistan's IT Industry

Pakistan's Software Prodigy

Biotech and Genomics in Pakistan

India & Pakistan Comparison Update 2011

India and Pakistan Contrasted in 2010
 
Eating Grass-The Making of Pakistani Bomb
 
Educational Attainment Dataset By Robert Barro and Jong-Wha Lee

Quality of Higher Education in India and Pakistan

Developing Pakistan's Intellectual Capital

Intellectual Wealth of Nations

Pakistan's Story After 64 Years of Independence

Pakistan Ahead of India on Key Human Development Indices

[Riaz Haq]

Here's an earlier post I did back in 2009 on this phenomenon:

Menlo Park, California based oDesk has ranked the Philippines and Pakistan as the top two outsourcing destinations in terms of growth, value for money and customer feedback.

oDesk helps its clients with tools, technologies and services to hire and manage remote work teams. Other companies in its category, including Elance, Guru and RentACoder, create marketplaces in which employers and freelancers can contact one another. These sites often manage the payments, and make money by charging membership fees and/or take a cut of the payment. The cuts can range from 4 percent to 15 percent.

According to oDesk, Pakistan experienced 328% growth in its outsourcing business in 2007-8, second only to the Philippines (789%) on a list of seven top locations that include US (260%), Canada (121%), India (113%), the Ukraine (77%) and Russia (43%).

Pakistan ranks number one in value for money for developers and data entry and number two overall behind the Philippines where the cost of answering calls is about half of the cost in Pakistan. Pakistan is well ahead of India and just behind the number 1 ranked United States in customer satisfaction.

The growth of outsourcing within the US and Canada as well as the high customer satisfaction data for North America are particularly noteworthy. It seems to indicate that more and more North American companies are showing preference for outsourcing close to home. New technology appears to be helping close the cost gap between North America and the rest of the top seven outsourcing destinations.

In addition to oDesk's view of Pakistan as a preferred outsourcing destination, Gartner, in its 2008 report ‘Analysis of Pakistan as an Offshore Service Location’ said the major factor behind upgrading Pakistan to first tier status for outsourcing is the lower salaries and better infrastructure advantages than other offshore destinations. “The salaries of IT professionals in Pakistan are approximately 30% lower than those in India, while telecommunication costs are also lower as compared to any other offshore locations, which make Pakistan an attractive outsourcing destination.”

oDesk says that "the results … the Philippines and Pakistan rank the highest in this admittedly simplistic analysis, which must be taken with a grain of salt." It adds, "There are many factors to be taken into consideration when hiring contractors to your workteams. But, in the meantime, congratulations to providers in these two countries for topping the list! Fans of outsourcing to the Philippines and Pakistan will also be glad to know that they were also the fastest growing countries on oDesk, by hours worked, from 2007-2008."

http://www.riazhaq.com/2009/01/pakistan-ranks-among-top-outsourcing...

[Riaz Haq]

Here's Express Tribune on IT contractors in Pakistan:

..From business process outsourcing to developing smartphone apps, Pakistani IT professionals are seem to be going after every opportunity, especially in the online job market, to bring home valuable foreign exchange.

In high demand, Pakistani IT professionals are growing significantly on oDesk, a Silicon valley-based online marketplace, in terms of both revenues and subscriptions to the platform.

“Pakistan is one of our largest contractor bases, and it is growing steadily,” CEO Gary Swart said in reply to queries through email. Contractors in Pakistan earned almost $1.5 million on oDesk in January 2012 alone, he said. “That figure is more than double the $700,000 they earned in January 2011, which is really an impressive growth!”

In January 2012, Swart said, more than 4,500 contractors from Pakistan signed up for oDesk, which enables businesses to hire, manage and pay a flexible online workforce, representing significant growth over previous months.

The top five categories of oDesk that work in Pakistan, according to the CEO, are web programming, web design, search engine optimisation, software development and mobile apps.

“In these five categories alone, contractors from Pakistan earned $796,000 in January 2012.” The number of Pakistani professionals that sign up for oDesk is growing steadily at a rate of 11% month over month, he added.

As seen from the top five job categories for Pakistani contractors, Swart said, there is certainly a large demand for their IT skills on the oDesk marketplace – which was the seventh fastest-growing company of Silicon Valley in 2011, according to the Silicon Valley Business Journal.

oDesk, according to Swart, is world’s largest online marketplace – as measured by dollars earned by contractors each month – and has 1.6 million registered contractors where 120,000 new jobs are posted each month. Contractors earned more than $225 million on oDesk last year, he said.

IT services are definitely a sweet spot for the oDesk marketplace in general, Swart said. The top two job categories on oDesk overall – web development and software development – together make up more than half of the total earnings on the platform, and demand for IT skills continues to grow rapidly.

Pakistan’s IT industry, according to Pakistan Software Export Board, has seen steady growth over the last few years despite sluggish economic growth – thanks to the online job market.

IT and IT-enabled services exports stood between $560 million and $860 million last year, according to former managing director of PSEB Imran Zia. On a Y-o-Y basis, the IT sector has been growing at 15% to 20% for the last three years and the growth in 2011 was about 15%. The future outlook for Pakistani IT professionals looks promising as IT jobs are in high demand on oDesk, where subscription rate of Pakistani contractors is growing steadily.

“IT jobs are our most in-demand category – which means we have significantly more IT opportunities for contractors from all countries, Pakistan included,” Swart said. “So we believe that we have more Pakistani IT professionals than any other online work marketplace,” he added.

http://tribune.com.pk/story/338556/pakistani-it-professionals-in-hi...

[Riaz Haq]

Here's ET on web start-ups in Pakistan:

The answer: remittances. Pakistan receives $13-14 billion annually from external sources. Compare that to the total it collects in taxes, which is around $10 billion. You can see for yourself what accounts for more in the economy.
Payments from abroad usually take two channels: they either come from Pakistanis working overseas, or they come through our relatively small, yet gigantic-in-effect, web start-up industry. This industry comprises businesses and freelancers that globally outsource their services, and includes names such as Sofizar Constellations, Naseeb Networks (Rozee.pk), TradeKey and others. Sofizar alone makes around $15 million per year, and TradeKey.com is the second biggest business-to-business sales portal in the world, following alibaba.com. One of the world’s best online affiliate marketer, Faisalabad’s Pasban IT Group, is doing so well, it owns the only Lamborghini Aventador and Ferrari F430 in Pakistan.
How are these companies doing so well, and how big are these Pakistani startups on the international scene? If the ownership of one of the world’s most expensive cars doesn’t sound impressive enough, let me take you back a few years. Back in the day, when Digg.com was alive, one of the world’s greatest Digg-ers, Waseem, was from Pakistan. He, along with a group of fellow marketers, was hitting the front page of Digg.com on a daily basis, which meant looping in hundreds of thousands of visitors in no time. That is equal to popping your article on Reddit.com’s front page these days. One of the clients of these champion Digg-ers was the Chicago Tribune. You can figure the rest yourself.
This is how the online marketing industry works. Most of what goes viral online is not what people naturally promote and share, but a result of gaming that system to perfection and with skill. This is what good internet marketers do: you can only judge on the basis of what content channel it comes to you from. What if I told you that T-Series, one of India’s biggest music record labels, has a prime internet marketing affiliate based in Karachi? They are just a bunch of boys who do it underground! The bidders for tenders for this job span the entire Earth. It shouldn’t come as a surprise to you, then, that a company based in Karachi makes apps for the National Aerospace and Space administration (that’s NASA, mind you), for the space giant’s mobile platform.

http://tribune.com.pk/story/541693/how-big-is-pakistans-internet-st...

[Riaz Haq]

Here's a report about Effective Measures eyeing Pakistan market:

KARACHI, PAKISTAN: Effective Measure, a rapidly expanding leader in digital audience profiling and measurement in emerging markets, has marked its official entry into the booming online media market of Pakistan.
Founded in Australia and operational in some of the world's most dynamic digital growth markets, Effective Measure has made a further commitment to assisting in the development of the Pakistan online media industry.

Effective Measure has been on the ground in the Pakistan market for over a year and has now formalised its presence following a series of key client wins and the coveted official industry endorsement by the Pakistan Advertisers Society (PAS) to facilitate digital audience measurement for the Pakistan digital media industry.

Effective Measure marked its official entry to the Pakistan market by supporting the PAS Awards on the 26th of April and hosting a series of high level briefings with key clients over the last week with visiting Effective Measure CEO Richard Webb and Effective Measure Regional Managing Director MEA, Brendon Ogilvy.

"The vibrant, emerging Pakistan market represents a great opportunity for Effective Measure to help transform a nascent digital media industry into a booming digital economy. We are delighted with the support and collaboration that we have experienced with local media and industry over the last year as we solidified our position in the market. The year ahead will be an extremely exciting time to be part of the local digital market and we will endeavour to share our international expertise to assist in expediting that growth potential and providing world class metrics and data that serve this diverse audience," Webb.

The Effective Measure solution benefits advertisers and media owners by offering superior access to audience reach and demographic data.

And heading up the Pakistan expansion is...

Leading Effective Measure's expansion in Pakistan is Effective Measure Country Manager-Pakistan, Imtiaz N. Mohammad, who has been developing market alliances and relationships over the last year. He joined the Effective Measure team with a rich background in both entrepreneurial digital projects, with technology consultancy Inspire-X and Crosby Asset Management and fixed and mobile content expertise with companies including SmartPhonz Wireless.

"As the Pakistan media market embraces digital it also faces regulatory, technology centric and economic challenges. Effective Measure's global experiences at the grass roots of emerging markets can help ease those challenges and turn them into electric opportunities. The potential in the Pakistan digital media market is huge and armed with the right tools we will assist in fostering the collective goal of turning Pakistan into a knowledge based economy," said Mohammad.

Under the PAS alliance Effective Measure has been working in collaboration with PAS to establish a market leading digital audience measurement service for the Pakistan industry. The breakthrough recognition of the Effective Measure platform, which was announced in March, has given Pakistan's advertising, publishing and digital media sectors a new level playing field to accurately assess measure and develop their valuable digital assets.

"The MEA region continues to exceed expectations across the digital media industry. The diversity of content and enthusiasm for digital engagement across all technology platforms is forcing advertising agencies and publishers to lift their game on all fronts. Insight, audience depth and accountability are no longer luxuries but mandatory tools of the trade and Effective Measure relishes bringing these opportunities for world-class digital development to the Pakistan market," said Effective Measure Regional Managing Director MEA, Brendon Ogilvy.

http://m.bizcommunity.com/Article.aspx?l=163&c=16&i=92755