Pakistan’s IT exports poised to hit $4 billion in FY25

Pakistan is on track to achieve $4 billion in information technology exports for the 2024-25 fiscal year, up from $3.2 billion the previous year, a top industry official said Saturday.

Muhammad Umair Nizam, Senior Vice Chairman of the Pakistan Software Houses Association (P@SHA), announced the projection during a high-profile meeting of the country’s leading IT companies in Karachi. The session focused on export trends, challenges, infrastructure growth and government policies.

Executives called on the Federal Board of Revenue and the State Bank of Pakistan to accelerate regulatory reforms, saying outdated policies hinder the sector’s rapid expansion. Nizam said the industry is diversifying into new tech sectors but faces bottlenecks due to inflexible regulations.

Ahead of the 2025-26 federal budget, expected in early June, P@SHA has submitted proposals urging tax incentives, streamlined foreign exchange rules and funding for skills development. Key demands include a 10-year tax holiday for new investments, fixes to sales tax discrepancies and faster implementation of Special Technology Zones.

Nizam also highlighted a disparity in income tax rates, noting salaried IT employees pay up to 35% while freelancers pay as little as 0.25%. "This discourages formal employment and must be addressed," he said.

Muhammad Zohaib Khan, former P@SHA chairman, said the IT sector is Pakistan’s only industry with a 75% trade surplus and the potential to grow exponentially, reduce the trade deficit and sustain economic stability.