IT sector to Miss by $1 bn exports target

By Kalbe Ali

While IT and related exports have posted growth of 25 percent in the 11 months of fiscal 2021-22, the sector was missing the target by almost $1 billion.

The official figures released by the ministry of IT and telecom have highlighted that the ICT export remittances, including telecommunication, computer, and information services, for July 2021 to May 2022 surged to $2.38 billion, with a growth of 25.45 percent against $1.89 billion in 11 months of 2020-21.

However, the performance of the IT and IT-enabled sectors, including the exports of services by freelancers, was significantly short of the anal target set jointly by the Ministry of IT and the commerce ministry.

In December 2021, the IT export target was set at $3.5 billion for 2021-22 by the PTI-led government, incidentally, the IT ministry was also aiming to launch the 5G service by the end of 2022.

Meanwhile, responding to the query, the minister for IT and Telecom, Syed Amin ul Haq, highlighted his meeting with the Prime Minister and said that steps were being taken to take ICT exports to record levels.

He added that with the implementation of the tax relief announced by the finance minister recently for the IT industry, things will get better.

At the same time, the minister added, “The growth of the IT sector was in line with the promotion of freelancers and IT professionals in the country, but it was essential to provide relief to the telecom sector for significant results from the IT sector.”

If the imposition of taxes on the telecom sector is not reduced, the IT sector will also be badly affected. “

Meanwhile, former president P@SHA, Barkan Saeed, said that one of the key reasons that have restricted the growth of IT and IT-enabled services (ITeS) is political instability locally and country perception and abroad. 

He said that P@SHA had submitted a report to the ministry in the month of May highlighting several reasons that the planned growth was not being achieved.

“Almost all the promises and assurances made by the former prime minister were not implemented even during that era,” Mr Barkan said.

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He highlighted that these included the tax credit regime which was not implemented, Cash Reward Distribution & Little Incentive scheme which was the first-ever monetary incentive for the IT/ITeS industry in 2021, but its implementation too was not proper.

Another incentive scheme was to allocate cash rewards based on growth, instead of total revenue too was not implemented.

“P@SHA had lodged a complaint to the former PM that the package announced by him in January 2022 for IT and ITeS was not being implemented,” Mr Barkan said, “The target of $3.5 billion was based on these incentives.”