Adviser to the Prime Minister on Commerce and Investment, Abdul Razak Dawood on Friday said that there is a lot of scope to increase exports in Information Technology (IT) from non-traditional sector at present.
The current annual $ 2.5 billion IT exports are very low, “We now have an annual export target of $3.7 billion this year, he said.
The Adviser said this while addressing to the ” Technology Roundtable” to highlight Investment opportunities in the IT and ITES (Information Technology Enabled Services) sector organized by Board of Investment ( BOI) here.
Today is the age of Information Technology and e-commerce, our youth can take full advantage of it, he said. Pakistan’s exports can now be boosted by focusing on some of the non-traditional sectors from the traditional export sector including textile, the Adviser said.
Abdul Razak Dawood said that there was a need to promote export culture in the country at present and the government wanted to increase exports on priority basis.
During his address, he said that Pakistan’s economy has made significant progress reflecting a blend of stabilization and structural reforms despite being challenged at economic and geo political front and is moving on a positive growth trajectory.
He added that Micro Small and Medium Enterprises (MSMEs), that use e-Commerce platforms, are around five times more likely to export than those in the traditional economy and the policy aims to pave the way for holistic growth of e-Commerce in the country by creating an enabling environment in which enterprises have equal opportunity to grow steadily.
He stressed that the way forward for Pakistan on the economic front is to focus on exports, specifically IT related exports.
He said that he sees a lot of potential in the young population of Pakistan and encouraged them to dream big for themselves and for their country. The Adviser affirmed that Pakistan has a bright future and is moving towards economic progress.
While addressing the technology roundtable session, Chairman BOI said that government of Pakistan is making all out efforts to put the economy on the track of long-term and sustainable economic progress.
He shared that BOI is mandated to promote, encourage and facilitate both local and foreign investment and acts as an interface between international and local investors, public and private sector.
He stressed that BOI works for enabling business environment through policy and strategic interventions.
“IT Sector Policy of Pakistan offers a generous set of incentives to investors” he said.
Ahsan apprised the participants on “Pakistan Regulatory Modernization Initiative” (PRMI), being led by BOI that was launched by the Honorable Prime Minister of Pakistan.
Once rolled out, it shall transform the regulatory landscape across all tiers of government, he said.
The Chairman shared that IT Sector Policy of Pakistan offers a generous set of incentives such as custom duties and sales tax rebates to local and foreign incentives.
He added that the IT sector also allows up to 100% foreign ownership and 100% repatriation of profits.
He encouraged business leaders to find new approaches to enhance technology-based landscape of Pakistan and make best use of this platform.
Secretary BOI, while highlighting IT sector specific reforms introduced in Pakistan shared that the payment limit for foreign vendors of digital services has been enhanced by SBP from USD $100,000 to USD$ 400,000 and the approval from SBP for payment above USD$ 100,000 has been waived off for digital services.
She further added that in order to facilitate IT businesses, 62 globally recognized companies have been notified requiring no approval from the State Bank and that the State Bank has allowed commercial banks to obtain the Cloud Outsourcing Services to meet their growing customers’ needs.
Ms. Fareena said that since 2015, the government of Pakistan has introduced various policies to encourage investment in the country, some of which include telecom policy, digital Pakistan policy, e-commerce policy, national cyber security policy etc.
The secretary expounded that Pakistan produces around 25000 IT graduates annually and is one of the most popular countries for free-lancing.
With 178 million mobile phone subscribers and 95 million internet users, the country offers vast opportunities in the IT sector,she.
She informed the audience that more than 3,000 international technology firms are registered with SECP including Intel, Microsoft, Amazon, Samsung etc. and the pace of technology adoption is speeding up.
Elaborating on some incentives introduced for the Special Technology Zones, Secretary BOI mentioned income tax exemption for 10 years including on dividends and capital gains, exemption of custom duties and taxes on capital goods for 10 years, exemption from G.S.T. on import of plant, machinery, equipment and raw-materials and exemption from property tax for 10 years.
The Technology Roundtable was a successful feat in showcasing opportunities in Pakistan’s thriving IT sector and ended with a unanimous vote of re-assurance that all stakeholders will work in close collaboration with BOI to uplift the development of IT sector to ensure export led growth and quality FDI.