Islamabad: In a remarkable turnaround for the technology sector, Pakistan recorded IT exports worth US$292 million in September 2024, reflecting a 42% year-on-year increase and marking the 12th consecutive month of growth. While this figure represents a 2% decline from August 2024, it exceeds the 12-month average of $280 million, demonstrating continued momentum in the industry.
According to Topline Pakistan Research, total IT exports during the first quarter of FY25 reached US$877 million, an increase of 34% year-on-year. The significant growth in exports is due to several factors, including the expanding global customer base, particularly in the GCC region, and the recent policy change by the State Bank of Pakistan, which raised the limit allowed for holding assets for exporters. Specialized accounts in foreign currency from 35% to 50%. This amendment encouraged IT companies to return a greater share of their profits to Pakistan.
Despite the decline month-on-month, analysts point to a shorter business month in September, with 20 working days compared to 21 in August, resulting in export revenues of US$14.6 million per day in September, up slightly from US$14.2 million in August. . .
Pakistani IT companies are actively seeking global partnerships, participating in prominent events such as London Tech Week 2024 and Collision Canada 2024. A survey conducted by the Pakistan Software Houses Association (P@SHA) indicates that 62% of IT companies use specialized foreign currency accounts , which further facilitates international transactions.
A noteworthy development this fiscal year is the introduction of a new category by the State Bank of Pakistan for overseas equity investment, allowing export-oriented IT companies to invest up to 50% of their revenues from specialized foreign currency accounts in foreign entities. This initiative is expected to enhance confidence among IT exporters and encourage more remittances to Pakistan.
Net IT exports for September 2024 were US$255 million, representing a 56% increase year-on-year and exceeding the 12-month average of US$245 million.
Looking ahead, industry experts expect continued growth in the IT sector, with expectations of a 10-15% increase for FY25, potentially reaching US$3.5-3.7 billion. Among the companies driving this growth, Systems Limited (SYS) has been highlighted as a preferred investment option, trading at an expected P/E of 14x for 2024 and 10x for 2025.