IT remittances of Pakistan breaking Records

For the first time in the history of Pakistan’s IT industry, IT remittances crossed $70.48 million in March 2017 as reported by State Bank of Pakistan (SBP).

2.5 years back in July 2014, monthly IT remittances were only $35.6 million. Hence, monthly remittances have almost doubled since then. This indicates a good sign for the growth of our IT industry and its exports.

We need to keep the same momentum going forward for the rest of 2017 to retain the remittance graph.

Comparison of Quartile1-Quartile3(Q1-Q3) of last year with the current year shows a growth of 16.7% in total Information Technology and Information Technology enabled Services.

it remittances

       A comparison of (Q1-Q3) remittances of last year with the current year

Pakistan Software Export Board(PSEB) announced in its ‘PSEB IT Awards 2017’ newsletter in March 2017 that applications for PSEB IT Awards with copies of R-forms during 2016-17 will be due in the month of July 2017, and PSEB will hold the awards ceremony by end of 3rd quarter this year.

The award categories for this fiscal year (July 2016 – June 2017) are top 10 IT Exporters, top 3 IT Startups, top 3 IT Exhibitors, top 3 Individual Consultants/ Freelancers, and top 3 Domestic IT Businesses.

Based on daily interaction with the IT & ITeS companies, majority of the companies are not actively pursuing their respective banks for reporting of their export remittances in IT & ITeS sector codes to the State Bank of Pakistan.

it remittances

SBP’s standardized codes for reporting monthly exports on the Export Proceeds Realization Certificates (EPRC)

PSEB estimates that even though $1.2 billion to $1.5 billion is currently being remitted to Pakistan through banking channels on annual basis, more than half is being reported in the incorrect codes such as personal remittances or expense codes instead of IT codes. This results in under reporting of the IT remittances which damages the image of the IT industry as a major exports sector for Pakistan.

Furthermore, international customers and investors rely on SBP’s data for investment and outsourcing decisions. Hence, IT industry needs to cross the billion dollar mark in remittances first before Pakistan’s IT sector will be taken seriously by foreign IT investors and customers.