Pakistan is said to be one of the largest economic blind spots in the world as the country is well placed to play an emergent role in the global economy over the next decade. However, to attain its potential, it is very important that Pakistan places the primary building blocks at the right direction in order to create an enabling environment to establish an ecosystem favorable for development. It should be supported by suitable policies and guidelines to increase speed and encourage innovation. This has already been demonstrated in the recent past by other economies in Asia Pacific.
Indeed, there is no quicker way to accelerate economic growth than the holistic digitisation of the economy. The great news is that public and private sector in Pakistan is enthusiastic and ready to take up this challenge. Sometimes back World Bank has highlighted Pakistan’s distinguished development about the ease of doing business due to numerous reforms in order to speed up and rationalize procedures for getting construction permits, online tax payments as well as registering property. on the other hand, regardless of moving up to number 108 in last year’s ranking (from 136 in 2019 and 147 in 2018), Pakistan is still behind the other middle-income economies such as Kazakhstan (25), India (63) and Indonesia (73).
According to the World Economic Forum’s latest Global Competitiveness Report 2020, Pakistan is likewise placed (110 out of 141 nations) in the scoring greatly for market size but lower the South Asia average for numerous other gauges. As organic GDP growth contracts, additional growth is obligatory mainly relating to the declaration of commercial arguments, labour market elasticity. Once done it will certainly strengthen Pakistan’s exterior insight of candidness to business and a feasible locality for investment.
The incumbent government in Pakistan has recognized the worth of digital technologies and proficiency to improve inclusion, support research and innovation, and unchain economic competitiveness.
In May 2018, the Ministry of Information Technology and Telecommunication attained approval from federal cabinet for starting work on Digital Pakistan, which included 12 objectives. The strategy aspired to employ ICT as a tactical enabler for sectoral revolution, economic development and an improved quality of life for citizens. In December 2019, based on suggestions from Ministry of Information and technology, the Prime Minister Imran Khan initiated his vision for the flagship Digital Pakistan policy. The basic objective of the policy was to bring online public services and stimulate the potential of youth and women.
The digital Pakistan policy further has had five priority areas which included, Access & Connectivity, Digital Infrastructure, E-Government, Digital Skilling & Training and Innovation & Entrepreneurship. While further explaining these prioritiy areas it is pertinent to mention that, access and connectivity basically explains the access to internet and the information is a fundamental right for all Pakistanis. The same way, digital infrastructure refers to construct a “Pakistan Stack” that permits government, business & startups to operate a digital infrastructure to resolve issues and move towards presence-less, paperless & cashless service delivery. E- Government focuses on contemporary Digitize intra-government procedures to head towards a paperless environment. It also focuses on Digitization of Pakistani citizen & business communication with government services. Pakistan citizen portal and many other applications are evident examples of this particular strategy or priority. Digital skilling and training revolves around the idea of an evolution to a knowledge economy by enhancement of our on hand capacity along with equipping our future generation. It also enhances the idea of going up to the value chain by quickly imparting the emerging technical skills.
Innovation and entrepreneurship put emphasis on the need to make it uncomplicated for investors to come and invest and ease for startups to activate and develop to further grow country’s economy while enabling Pakistan to get a global playing field. The present decade will consequently be a crucial stage in Pakistan’s national development voyage and the enlargement of the ICT sector in the country. Pakistan has a vast youth population, with more than 100 million citizens under the age of 25. Engrossing this demographic into the labour force means the economy must develop quicker than it has over the past five years. Nevertheless, Pakistan has a literacy rate lower than the South Asia average and shows skills discrepancy in few technology related areas.
These aspects as well as affordability, an apparent lack of relevance are few of the vital barricades to consumers using internet through their mobiles. Furthermore, those who do not use the mobile internet, 27% says that they do not have anyone to teach them or help them learning use of the mobile internet. In presence of Covid 19 pandemic things have been improved in this regard as well. People left with no option and the use of digital platforms has become an evident factor. Currently, Pakistan is all set to double its IT industry in two years by setting up devoted tech zones across the country. It is expected that Pakistan may open a dozen such zones by next year.
Through Special technology zone authority Pakistan is offering a 10-year waiver on corporate tax and imports of any equipment or construction material desirable for the areas, which will provide Pakistan’s IT industry a catapult push in quest of doubling its size to as much as $6 billion in coming 2 years.
Pakistan is already working on the new tech zones to produce employment opportunities for its people particularly the youth of the country. It is also pertinent to mention that huge overseas investment into startups from fintech to e-commerce in the backdeop of the coronavirus pandemic is also highlighting the demand for devoted zones to serve these industries. Amer Hashmi who is heading the special technology zones authority revealed in an interview that around half a dozen international companies and 50 domestic firms have showed interest in setting up in planned zones. As much as $1.5 billion of private investment will pour into these projects over the next two years. He is also compelling the government, which is spending millions of dollars on technology-based projects, to give more contracts to local companies.
On the other hand, while revealing the Economic Survey for FY21, Finance Minister Shaukat Tarin expressed high hopes on the expansion in IT sector exports, which he supposed could attain 100% or more in the coming years. Highlighting India’s IT export increase, which expanded to $100 billion in 2010, from $1 billion in 2000, the minister questioned as to why Pakistan could not augment its IT exports to $40 billion, if not $100 billion. According to the Economic Survey, there has been a vigorous expansion in IT and IT-enabled services (ITeS) payments over the past five years, with composite annual growth rate (CAGR) of 18.85% which is the uppermost growth rate as compared to all other industries and the highest in the region. The startup trend prevailed at a quick speed, with accomplishment stories coming out every year. Pakistan’s IT industry counts as the world’s largest entity among its regular clients and supplies its services to 120 countries internationally. The IT sector in the country has revealed considerable growth in the last few years.
The country’s exports of IT associated services have developed by 40 percent in the last few months only. The State Bank of Pakistan proposed modifications to the present foreign exchange system regarding borrowing from abroad in a bid to ease those fintech and startup companies that plan to invest in the form of adaptable debt as an alternative of directly as equity. A new type of loan may be initiated to accomplish the precise requirements of startup companies while keeping in vision the problems they are facing in growing investment, in the form of adaptable debt, from overseas under existing system. A company may lift funds from out of the country in the form of convertible debt.
The potency of the Pakistani Diaspora is an additional viable differential which could be a huge foundation of force for our industry by assisting to set up their path in the western markets.
Tens of thousands of IT experts with Pakistani origin are settled in the West, whose combined potential could be the main changing factor for the digital regime of Pakistan. The Fourth Industrial Revolution which carries with it frequent challenges for the on hand technological site also pledgess new avenues of opportunity in the field of Artificial Intelligence, IoT (Internet of Things), Data Analytics etc. the talent in Pakistan is exclusively positioned to take benefit of it due to their quick learning aptitude in the existence of new mediums of e-learning which get rid of the traditional barricades of learning limited to physical spaced knowledge platforms. In presence of all these mentioned developments, Pakistan is accurately balanced to become a new hub in the field of Information Technology. The need is to move forward with the same positivity. In coming years Pakistan will be certainly be a desirable destination for entrepreneurs in the IT industry.