Amir Khan

The government’s ambitious IT export target of $50 billion in five years and to increase it to a staggering $100 billion paints a hopeful picture amid the current economic uncertainties, said the State Bank Memorial Chairperson Dr. Waseem Shahid Malik. In an interview with WealthPK, he said the Pakistan Software Association (P@asha) serves as our starting point. While the annual IT remittances through the banking channels have surged, totalling just over $2 billion in export revenue, this figure pales in comparison to the estimated $280 billion sector size. With over 12,000 IT companies contributing nearly 5% to the GDP, the dissonance between potential and reality becomes stark. “Delving into the State Bank of Pakistan (SBP) data unravels a preference for the services sector to software development, with services claiming nearly 70% of the already modest funding allocated to the IT sector. This inclination may involve the controversial body-shopping business model, where local talent is hired at minimal costs and outsourced to international projects,” he added.

The World Bank's Global Knowledge Index delivers a sobering reality check, positioning Pakistan among the lowest globally. Deficiencies in information and communication capabilities, education quality, and human resources cast shadows over the nation's IT prowess, sparking concerns about the skill level the country has cultivated so far. According to Shahid Malik, less than 10% of local IT graduates pass a basic computer test, highlighting an alarming employability crisis. A State Bank of Pakistan report adds to the dismay, indicating that a mere 10% of IT graduates in Pakistan are deemed employable.

As the traditional export sectors face threats due to a lack of innovation and research, the IT industry must learn from the past. Competing at the lower end demands more than lower costs, it requires a foundation of competitive infrastructure, access to cheap capital, a dynamic domestic market, and other critical components. As more and more IT institutes and colleges offer education in the field, they need to be examined carefully. If only 10% of their graduates are employable, as reported, then their curricula must be revised urgently.“In the echoes of optimism, the dream of IT-led prosperity in Pakistan may not be a mirage, but it demands a meticulous dismantling of illusions and a steadfast commitment to addressing the challenges laid bare by data and analysis,” he stressed. As the nation charted its course in the digital era, the truth behind the rhetoric will determine whether Pakistan's IT ambitions are indeed a reality check or a pipe dream, he said.

Credit: INP-WealthPk