Driving Growth Pakistan’s IT Sector Surges with 17.37% Export Increase in 2023-2024
Pakistan’s IT and IT-enabled Services (ITeS) sector has been experiencing significant growth in its export performance recently.
Between July 2023 and March 2024, the sector’s export remittances reached $2.283 billion, marking a substantial increase of 17.37% compared to the $1.945 billion recorded during the same period in the previous fiscal year. Several factors have contributed to this impressive growth trajectory. One of the pivotal reasons behind the surge in IT exports has been the State Bank of Pakistan’s (SBP) decision to relax foreign currency retention limits.
The SBP increased the permissible retention limit for IT companies from 35% to 50% in the Exporters’ Specialized Foreign Currency Accounts.
This move incentivized IT firms to repatriate their foreign earnings and deposit them into local accounts, thereby bolstering the country’s foreign reserves.
A stable Pakistani rupee has played a crucial role in encouraging IT companies to repatriate their foreign income. A stable currency reduces the risk associated with foreign exchange fluctuations, making it more attractive for companies to bring their earnings back to Pakistan.
March 2024 emerged as a standout month for IT exports, with the sector achieving its highest-ever monthly export figure of $306 million.
This marked a 36% increase compared to March 2023, highlighting the sector’s strong momentum. The monthly IT exports for March 2024 were 19% higher than the previous month, indicating sustained growth.
