Pakistan’s IT exports hit record $3.8bn in FY25, but sector urges policy clarity

ISLAMABAD: Pakistan’s IT exports reached a record $3.8 billion in the fiscal year 2025, showing an 18 per cent rise from the previous year. The increase shows the growing role of the tech sector in the national economy, as global demand for digital services continues to rise.

A key driver behind the surge was freelance and remote work, which grew by 90 per cent to $779 million. The increase reflects Pakistan’s expanding digital talent and its growing presence in the international IT services market.

The Ministry of IT and Telecom credited the growth to progress in five key areas: boosting Pakistan’s global tech image, investing in infrastructure and talent, providing policy support, improving high-speed internet access, and launching digital initiatives like promoting a cashless economy.

IT and Telecom Minister Shaza Fatima said the government aims to reach $15 billion in annual IT exports by 2030. She said ongoing reforms would support this target and build a stronger digital ecosystem.

However, tech leaders say policy issues remain a major concern. The Pakistan Software Houses Association (P@SHA) warned that inconsistent tax policies and complex regulations are slowing progress. The group urged the government to introduce a stable, long-term tax and compliance framework.

Read more: Stronger exports, remittances lift Pakistan’s reserves to highest since 2022  

P@SHA Chairman Sajjad Syed said many entrepreneurs spend too much time managing overlapping rules instead of growing their businesses. “Investors always ask the same two questions: What will my tax exposure be, and will the rules change after I invest?” he said. “If we offer clarity and simple compliance, capital will come.”

P@SHA proposed several reforms, including an extension of the 10-year Final Tax Regime on IT exports, resolving payroll-related tax issues, and launching a digital foreign currency channel similar to Roshan Digital Accounts.

Other suggestions include cutting the super tax under Section 4C, removing capital gains tax, and unifying provincial sales tax returns. They also called for merging labour-related levies like EOBI, SESSI, and PWWF into one digital system.

“These aren’t subsidy requests,” said Syed. “They’re about predictability and ease of doing business.”
While the numbers are encouraging, the tech industry says future success depends on smart, stable policies.

Read next: Foreign investment in Pakistan rises 5pc in FY25, driven by Chinese inflows