IT industry earnings touch $116m: SBP -Pakistan Press Foundation (PPF)

Paksitan Press Foundtion

IT industry earnings touch $116m: SBP

ISLAMABAD: The IT industry’s export revenue as reported by the State Bank of Pakistan (SBP) reached $116 million in financial year 2006-07, crossing the target of $108 million set for the year.

This indicates an increase of 61.18 per cent in IT exports when compared to the previous year’s export revenues of $72 million, says an official announcement on Thursday.

The SBP, in its statement for the year 2006-07, has estimated the country’s IT services export revenue at US$116 million, which indicates a consistent annual growth, a spokesman of Pakistan Software Export Board (PSEB) said.

BPO and call centers have made a significant contribution increasing exports due to adequate telecom facilities and trained manpower available in the country. Considering that the 15 per cent GST imposed on computer hardware in the federal budget 2006-07 has not yet been removed, this rise in IT exports is commendable.

The current IT exports annual growth rate is still understated as only 5 per cent of the country’s registered companies file their export data with SBP.

PSEB is making vigorous efforts to ensure that the export figures of all IT companies are reported to SBP.

The State Bank of Pakistan utilised the BPM-5 Reporting System to account IT exports revenue, which also restricted the export revenue figure to $116 million in 2006-07. The Reserve Bank of India, on the other hand, follows the BPM-6 Reporting System, which raises its exports to billions of US dollars.

BPM-6 includes sales to multinationals, earnings of overseas officials and salaries of non-immigrant overseas workers to export revenue.

Utilising the BPM-6 Reporting System, Pakistan IT Industry’s exports are estimated at $1.4 billion while the total industry size is estimated at US$2.8 billion.

With over 1042 IT companies registered with PSEB, the country’s IT exports grew by an average of 50 per cent in each of the last four years. PSEB has been facilitating the country’s IT industry through its programmes in Human Capital, Office Space, Marketing, Company Capability Development, Telecom Bandwidth, Industry Finance, Public Policy, Strategy and Research, and Facilitation.

The Government of Pakistan has also introduced an incentives package for the IT sector including tax exemptions until 2016, 100 per cent foreign equity and earnings repatriation, and low-rent facilities for IT companies.
Source: The News