The upcoming financial year 2023-2024 sets a GDP growth target of 3.5% for the government, a rate considered economically favorable by most experts. However, the spotlight now shifts to the IT industry and the initiatives that lie ahead.
Over the past two decades, economic analysis has shown that annual GDP growth above 2.5% has the potential to reduce unemployment by 0.5%. This equation presents an opportunity to simultaneously increase overall economic growth and decrease unemployment rates.
Given the current state of the economy, there is a pressing need for sustained GDP growth and ample employment opportunities. This is where Pakistan’s IT sector emerges as a crucial player. It took the nation five years to recognize the industry’s potential as a driving force for economic stability. Since then, industry players have been striving to place Pakistan on the global tech map.
As a developing tech player in the Indo-Pacific region, we face the challenge of having only 10% of IT graduates deemed employable, despite the growing number of IT companies in the country. Each year, around 300 startups are launched in Pakistan, but only a few manage to survive. Numerous hurdles hinder the progress of successful businesses, calling for intervention from industry leaders to prevent eventual collapse.
Looking ahead to the predictions for FY23-24, the tech sector eagerly awaits a comprehensive package that includes a fixed tax regime tailored for the industry. It also promises special incentives for emerging ventures to promote entrepreneurship and foster leadership change within the IT sector.
The Mega Incentive Package aims to benefit the youth by establishing IT training zones and providing subsidies to encourage trade through the utilization of modern technology. Another ambitious goal is to increase IT exports to $4.5 billion by 2024, positioning Pakistan as a major player in the global IT landscape. The crucial question now is how existing industry players can contribute towards this common goal.
The current IT budget directly impacts six key areas: fiscal growth, export expansion, employment opportunities, industrial development, investment prospects, and human capitalization. These encompass nearly every aspect of our economic and societal development. To fully leverage the resources and reforms provided by the government, industry leaders must adopt a systematic and purposeful approach.
Pakistan now boasts several incubation centers, including seven established by the government. These centers not only grant access to investors and funding but also provide commercialization support, networking opportunities, and mentorship for aspiring entrepreneurs. Additionally, the incubation culture plays a crucial role in fostering a comprehensive approach to human capitalization, facilitating workforce transformation and creating employment opportunities for skilled individuals.
Taking a broader perspective, these efforts will have a ripple effect on the growth of emerging subsectors such as startups, freelancing, and e-commerce. The contributions of these verticals will directly impact the country’s socio-economic landscape. By capitalizing on IT-friendly reforms, industry leaders can forge partnerships with tech giants like Apple, PayPal, Google, Amazon, and others, paving the way for industry growth and strengthening Pakistan’s position in the global tech ecosystem.