The Pakistani government has announced a new policy allowing Information Technology (IT) companies to retain 50% of their export revenue in dollars in a local account. This decision is facilitated by the Special Investment Facilitation Council (SIFC) and the State Bank. It aims to address the challenges encountered by IT firms that previously had to keep their dollars abroad due to restrictions.
The move is a response to the unique needs of the IT industry, where companies often have to pay salaries to international employees working with foreign clients and cover monthly expenses for cloud hosting, marketing, and sales on platforms such as Google, Amazon, Azure, LinkedIn, and others. Caretaker IT Minister Dr. Umar Saif highlighted the collaborative effort with SIFC and the State Bank to implement this policy intervention. The new flexibility allows IT companies to keep a larger portion of their export revenue within Pakistan, enabling them to use the retained dollars for international expenses without facing any restrictions.
The impact of this policy change has already shown positive results, with IT companies starting to repatriate their dollars. In just one month since the intervention, the export revenue of the IT sector has witnessed a 14% increase, representing a 20% growth compared to the same period last year. Dr. Saif expressed optimism about the trajectory of the IT industry, stating that if this growth rate continues, the country is on track to surpass $3 billion in IT exports within a few months.
He reiterated the government’s commitment to supporting the IT sector’s expansion and its ambitious goal of reaching $10 billion in IT export revenue. This policy shift is expected to create a more favorable environment for IT companies to conduct their financial transactions within the country, contributing to the overall growth and success of the IT industry in Pakistan. The government remains focused on fostering an environment conducive to the upward trajectory of the IT sector and achieving substantial export revenue milestones in the near future.