Information Technology (IT) exports remittances surge to all-time high | Pakistan Press Foundation (PPF)

Pakistan Press Foundation

Information Technology (IT) exports remittances surge to all-time high

Pakistan Press Foundation

ISLAMABAD: The Information Technology (IT) exports remittances including telecommunication, computer, and information services during the first 11 months (July-May) of the current fiscal year 2021-22 have surged to an all-time high of $2.381 billion growing by 26 percent in comparison to $1.898 billion during the same period in 2020-21.

According to the official data, Information and Communication Technology (ICT) export remittances were $183 million i.e. registered a negative growth rate of eight percent when compared to $198 million reported in May 2021.

ICT exports remittances also declined by 26percent on a month-on-month basis in May 2022 when compared to $249 million in April 2022.

Prime Minister Shehbaz Sharif has stated that Pakistan offers huge opportunities for investments in the technology sector and the government intends to increase IT exports from $1.5 billion to $15 billion in the coming years.

For achieving this target, the premier said that foreign tech companies would be facilitated in all respects with regards to investment, expansion and close collaboration.

However, Federal Minister for Information Technology and Telecommunications Syed Aminul Haque has said that the Federal Board of Revenue’s policies and some rules of the State Bank of Pakistan (SBP) are hindering the growth of Information Technology (IT) exports in the country and increasing export remittances through freelancers.

“Due to the FBR policies and some rules of the SBP, it is feared that local talent may be working here but by operating its own company from another country, that country may be getting all the foreign exchange and credit of IT exports”, said Haque while presiding over a meeting of the Policy Committee and Research and Development Fund.

Haque further stated that the FBR policies were an impediment to the increase in the number of IT exports and freelancers and export remittances, due to which software companies and freelancers were thinking of shifting their business to other countries. This would be dangerous because our talent would be used here but the benefits and credit would go to another country there is no reason why we can get billions of dollars’ worth of foreign exchange from the IT Sector.

“It is necessary to relax strict conditions including tax enforcement and give maximum relaxation to the IT industry and Freelancers, otherwise, it is feared that if IT companies and freelancers are not given facilities including tax incentives, the industry will shut down soon”.

Sources told this correspondent that the IT Ministry will target $5 billion in exports of the Information Technology (IT) sector for the next fiscal year, which would be subject to the resolution of outstanding issues with the FBR and the SBP. The ministry has concerns over matters related to withholding tax and incentives for freelancers

Source: Business Recorder

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