By Burhan Mirza
For the financial year 2023-2024, the government is looking at a 3.5% GDP growth target. Most experts believe this GDP (Gross Domestic Product) rate is a safe zone, economically. However, the most important thing is what’s in store for the IT industry.
Over the past 20 years, the economic synopsis has suggested that annual GDP growth over 2.5% is potentially causing a 0.5% drop in unemployment. This equation is a solid way to kill two birds with one stone—an increase in the overall growth rate and a decrease in the unemployment rate at the same time.
The country’s current economic standing is in dire need of a maintained GDP rate alongside generous employment opportunities; this is where Pakistan’s IT sector comes into play. As a nation, it took us five solid years to accept the industry as a forming sector that could contribute towards our economic stability. Since then, our industry players have been putting efforts to bring the industry on the global tech radar.
As a developing tech player in the Indo-pacific region, we only have 10% of the IT graduates who are employable, which is a little worrisome given the abundance of IT companies that are popping up in the country. Every year around 300 startups are launched in Pakistan, however, only a handful of them survive. There are multiple issues that halt the progress of a successfully running business. And this lays some heavy weight on the shoulders of industry tycoons – more like a call for intervention to avoid an eventual collapse.
Circling back to the predictions for FY23-24, the tech sector is awaiting a comprehensive package that is said to have some fixed tax regime tailored specifically. Moreover, it has special incentives for emerging ventures to boost entrepreneurship and foster change of leadership within the IT sector.
The Mega Incentive Package comes with benefits for youth, such as the creation of IT training zones and providing special subsidies, promoting trade through the utilization of modern technology. Another ambitious goal for the growth of the IT industry is to increase exports to $4.5 billion in 2024. This target is a key number in positioning Pakistan as a major player in the global IT landscape. Now, what matters the most is how the existing players can contribute towards one common goal.
Taking into account the current IT budget, it directly impacts six broad categories; fiscal growth, export surging, employment opportunities, industrial growth, investment opportunities, and human capitalization. All these cover almost every aspect of our development both as an economy and society.
When we talk about things like export revenue surges, employment, business setup, investments, and human capitalization, we need industry leaders to take charge. In order to do justice to all the resources and reforms provided by the government, we need a systematically thorough approach to utilize these resources purposefully.
Today, Pakistan has several incubation centers, out of which seven are set up by the government. These incubation centers not only provide access to investors and grants but also offer commercialization support, networking opportunities, and mentorship to budding entrepreneurs. Besides that, incubation culture plays an integral part in formulating a holistic approach toward human capitalization. This further enables workforce transformation by creating room for contractors who initiate microwork platforms which benefit bigger sharks in the industry by generating revenue in billions as well as creating employment opportunities for skilled staff.
From a broader perspective, this will have a ripple effect on the growth of emerging subsectors that include startup(s), the freelance industry, and the e-commerce sector as individual verticals. The contribution of these verticals will directly impact the socio-economic situation of the country. Furthermore, by leveraging IT-friendly reforms in the country, it will be possible for industry leaders to pitch and partner with tech giants like Apple, PayPal, Google, Amazon, etc., to enter the market, eventually leading to the overall growth of the industry and strengthening our foothold in the global tech ecosystem.
