The Future of IT Industry in Pakistan

By

Munawar Iqbal

To achieve the target of enhancing our IT exports Pakistan needs to develop human resources, establishment of IT parks, bandwidth facilities, financing arrangements, enabling laws and then of course to explore new markets in this sector.
We also need to work on improving the image of the country. We should also train our educated youth and we may provide funding to IT companies so that a trained human resource could be available for the industry.
Pakistan needs long term policies for the real promotion in Information Technology sector and these policies ought to be focused on enhancing knowledge based skills. It’s like investing in the quality education of children so that they become more productive individuals instead of employing them in the factories and reaping small dividend by their daily wages.
It sector is no different in this regard and we need to decide now that wither we want to squeeze the sector for smaller revenue or we should invest in the sector for long term progress and development of the country.
Of course, Pakistan has a huge potential in IT sector but it can not be tapped without setting the goals and targets. The first target in this regard would be enhancing IT based exports but the question is how to achieve this target?
To achieve the target of enhancing our IT exports Pakistan needs to develop human resources, establishment of IT parks, bandwidth facilities, financing arrangements, enabling laws and then of course to explore new markets in this sector.
We also need to work on improving the image of the country. We should also train our educated youth and we may provide funding to IT companies so that a trained human resource could be available for the industry.
Another area that needs our immediate attention as a prerequisite for the promotion of this sector is higher education. Though, we have made some progress in this area during past few years but still there is a lot to be done. India has a clear edge in higher education and its being resulted as its phenomenon progress in the sector.
We need to promote higher education as topmost priority. Besides, we ought to learn from our neighboring country that how business community is being honored in that society but we are fail to give the same respect to our businessmen.
The private sector has played key role in the promotion of IT sector in India and same could be done here provided an enabling environment is ensured for this purpose.
While we make comparison with the growth of IT and computer industry in the other countries of the region, a serious question arises that why we are not at par with them whe n the private sector is striving hard to promote this vital sector of the economy and government has also declared the promotion of the sector as one of its top most priority.
To answer this question we need to have a comparative look at the state of affairs and the actual role and incentives provided by concerned governments to their IT industry. Turkey has exempted its Computer industry from GST, import duty and corporate income tax while allowed personal income tax for 10 years.
Vietnam has given the industry exemption of GST and import duty besides 4 years exemption of corporate income tax and relaxation in personal income tax ranging from 3 to 35 per cent. Thailand and Malaysia have also offered similar sort of incentives to their industry which is being translated into steady growth of this sector in above mention countries.
Despite the poor computer density in Pakistan, the private sector has made huge efforts to streamline the sector which is a backbone of the national economy as well all other sectors of the economy.
As a result of this hard work Pakistan has achieved a certain level of success over the years but the sudden slowdown has created a panic in the market which needs to be addressed any further delay and government ought to come forward and rescue this ailing sector and to reinitiate the progress and growth of the sector.
The imposition of the 15% GST in June 2006, Pakistan's PC/Server market was a "diamond in the rough", but since then, a downward trend in the IT market has been noticed. The decision has weakened the growing IT market in the country, as well as decreased the confidence of the private investor.
Moreover, it has been resulted as increased prices of computers which have enhanced the cost of doing business. The average price of PC reported by local assemblers and retailers increased up to 20%. This is one of the factors which have negatively impacted the growth of the IT sector as evident by export figures during last two years.
As far as the role of foreign missions in regard with exploring new markets for Pakistan, it would be highly advisable to send experts from the relevant field abroad as special expertise is required to negotiate for new markets in this highly specialized sector.
As the present government has taken some significant steps for the strengthening of democracy and greater reconciliation in the country, one expect that sanity will finally prevail in regard with at decision-making in vital IT sector as well and this important sector of economy will be thriving as a result.