State Bank: Pakistan IT Exports Surge Past Billion Dollars in 2018

[Riaz Haq]

Pakistan's information technology exports have bucked the nation's declining exports trend with double digit growth to reach $1,065 million in fiscal year 2018, according to the State Bank of Pakistan.  It is generally believed that Pakistan's central bank underestimates technology exports. Some have argued that the actual IT exports were closer to $5 billion in fiscal 2018. Some of the differences can be attributed to the fact that the State Bank IT exports data does not include various non-IT sectors such as financial services, automobiles, and health care.

Source: State Bank of Pakistan

Pakistan IT exports surged 13.4% to $1.06 billion in fiscal year 2018 from $939 million in fiscal year 2017. The growth was even more robust in the prior year with IT exports rising 19.1% from $789 million in fiscal 2016 to reach $939 million in fiscal year 2017.

Source: State Bank of Pakistan

About $320 million of IT exports revenue in fiscal 2018 came from software exports while the rest was made up of services such as consulting, telecom and call centers.

Double Digit CAGR in Pakistan IT-ITeS Exports in 2010-2018

Online Labour Index top 20 worker home countries, 1-6 July 2017

Freelancers in Pakistan are benefiting from the growing access to broadband connections which are now being used by over 50 million Pakistanis across the country. Pakistan is ranked 4th in the world by the freelancing industry report.  The country has rapidly increasing human capital of technologists.

Growth in IT exports is a good sign for Pakistan's export diversification beyond commodities such as textiles and food. In addition, air forces of about a dozen developing nations are buying and deploying Pakistani made aircrafts. The reasons for their choice of Pakistan manufactured airplanes range from lower cost to ease of acquisition, maintenance and training.

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[Riaz Haq]

An analysis of IT software and service exports from India


Manzoor Hassan Malik, Nirmala Velan
International Trade, Politics and Development

https://www.emerald.com/insight/content/doi/10.1108/ITPD-12-2019-00...


India is not an exception. The tremendous success of the IT sector after economic reforms, particularly in software and service exports, has influenced economic growth of the Indian economy. The importance of IT software and services has been increasing since the last decade, as reflected by its mounting shares in various macroeconomic parameters, like national income, total exports, employment and foreign exchange of the country. An abundant supply of labour force acts as a comparative advantage of the Indian software and services industry. Investments in the education industry in the form of Indian Institute of Technologies (IITs), Indian Institute of Management (IIMs) and engineering colleges over the years have significantly contributed to the growth of software and service industry. The country's abundant IT professionals have been absorbed by the software and services export sector, thus enjoying some sort of monopoly in supplying desired labour (Arora and Athreye, 2002). The benefit of the International Standard Organization (ISO) certification is also significant because it acts as a quality signal to potential customers. This certification has enabled to enjoy the firm’s enhanced income through higher level of price per unit of output besides increasing the quality of output (Arora and Asundi, 1999). Large changes in the locational division of labour brought more jobs to India. The real benefit to the industry comes through exports carried out on-site, which do not involve costs of hardware or software technology for the Indian firms.
Indian IT industry has recorded exceptional growth rate, particularly after the period of liberalization. It accomplished 51% compound annual growth rate, with it being the only nation to have this rate of growth during the period 1990 to 2002. The domestic software industry growth rate was even higher than that of the global industry (Kumar 2001). However, the IT industry witnessed a falling growth amid a worldwide change in innovation and business models since 2014. Its software and services exports are experiencing a skewed nature of slowdown in growth, essentially due to the reliance on North American and European markets. Furthermore, other developing nations, like China, Malaysia and the Philippines, are also entering into the world software market in meeting the global demands of software and services of the advanced nations by overcoming their earlier hurdles. Now, an important question that arises is how to deal with the global strategic paradigm shifts [1]. Answering this question requires an assessment of the direction and magnitude of the potential factors responsible for software and service exports. This article attempts to investigate the factors that influence software and service exports from India both positively and negatively. Such a study is important to understand in depth the impact of each determinant on software and service export, for formulation of policy measures for sustainability and competitiveness of the Indian IT industry.

[Riaz Haq]

Pakistan’s IT exports hit record $342mn in March 2025 - Profit by Pakistan Today


https://profit.pakistantoday.com.pk/2025/04/17/pakistans-it-exports...

KARACHI: Pakistan’s technology sector continues to build momentum, as the country posted its highest-ever monthly IT export proceeds in March 2025, clocking in at US$342 million. This reflects a 12% year-on-year and month-on-month increase, underlining both rising global demand and supportive domestic policy measures. The figure is also well above the 12-month trailing average of US$311 million.


The latest number brings total IT exports in the first nine months of FY2025 (9MFY25) to US$2.8 billion, up 24% year-on-year, positioning the sector firmly on track to surpass last year’s full-year performance.

Pakistan has now recorded 18 consecutive months of year-on-year IT export growth—a trend that began in October 2023. Industry observers attribute this resilience to a combination of strategic factors, including regulatory reforms, currency stability, and an expanding international footprint.

A key factor has been the State Bank of Pakistan’s (SBP) relaxation in the permissible foreign currency retention limit, which now allows IT exporters to retain up to 50% of their export proceeds in Specialised Foreign Currency Accounts—up from 35% previously. This flexibility enables companies to reinvest profits more easily and manage foreign operations efficiently.

In a further boost, SBP has introduced a dedicated category titled Equity Investment Abroad (EIA). Under this regime, export-oriented IT firms can acquire shareholding in overseas ventures using their foreign currency accounts. This is seen as a step towards helping Pakistani tech companies scale up internationally and forge strategic partnerships, particularly in Gulf countries and beyond.

Additionally, a stable exchange rate has encouraged exporters to repatriate a larger share of earnings—a critical factor in the sustained increase in monthly inflows.

Looking further ahead, the government’s ‘Uraan Pakistan’ economic plan aims to elevate annual IT exports to US$10 billion by FY2029, which would require a compound annual growth rate (CAGR) of approximately 28% over the next four years. While ambitious, recent trends suggest that the sector is well-positioned to pursue this target—provided policy continuity and investor confidence are maintained.

Analysts at Topline Research maintain a bullish stance on the sector, citing Systems Limited (SYS) as their top pick. The firm is currently trading at 13.4x and 10.1x forward price-to-earnings multiples for 2025 and 2026, respectively, indicating room for upside as Pakistan’s digital economy matures.