Pakistan’s information technology (IT) exports have hit an all-time high of $305 million in February 2025. This is a 19% rise from the same month last year, demonstrating the sector’s strong growth. That said, it is worth mentioning that this figure is down 3% from January 2025, largely due to the shorter month.
Continuous Growth Trend
Notwithstanding the mild month-wise fall, February 2025 is the 17th back-to-back year-on-year rise in IT exports, a cycle initiated in October 2023. In the initial eight months of fiscal 2025, cumulative IT exports have risen to $2.48 billion, which represents an impressive 26% rise on a year-on-year basis. Furthermore, in February, per day export earnings averaged $16.1 million compared to January’s $13.6 million, reflecting the optimistic trend in the industry.
Drivers of Growth
In a report by Topline Securities, several primary drivers are cited for the phenomenal growth in IT exports. One major driver is the increase in client bases of IT firms, especially in the GCC region. Another factor is that the State Bank of Pakistan recently eased the limit of permissible retention in Exporters’ Specialized Foreign Currency Accounts from 35% to 50%. This policy shift has also prompted exporters to bring back a greater percentage of their earnings, thereby increasing overall export rates. The facility to invest equity abroad using these accounts has also increased confidence among IT exporters.
Global Engagement and New Regulations
Pakistani technology companies have been increasingly reaching out to international clients, attending high-profile events like LEAP 2025 in Saudi Arabia and Web Summit in Qatar. According to a survey carried out by the Pakistan Software Houses Association (P@SHA), 62% of IT businesses are holding foreign currency accounts specialized in nature, highlighting the sector’s resilience towards changing financial rules.
A significant milestone during fiscal year 2025 is the launching of a new category by the State Bank of Pakistan for Equity Investment Abroad (EIA), targeted especially for export-oriented IT businesses. The scheme facilitates IT exporters to invest in shareholding in overseas companies out of their up to 50% of proceeds in special foreign currency accounts, increasing the motivation for funds repatriation.
Future Projections
Net IT exports, which are exports minus imports, were $278 million in February, up 21% year-on-year but down 1% month-on-month. This is above the 12-month average of $265 million. In the future, Topline Securities analysts forecast that the IT sector will continue to grow, with a projected growth of 10-15% for fiscal year 2025. This would see total IT exports range between $3.5 billion and $3.7 billion.
Conclusion
The government has ambitious goals of reaching $10 billion IT exports by the fiscal year 2029, suggesting a 28% compound annual growth rate (CAGR) until that time, under the ‘Uraan Pakistan’ national economic strategy. The aggressive target depicts the optimism surrounding the sector’s capability to generate huge contributions for the national economy
