Pakistan’s IT exports cross $4 billion for first time

Pakistan’s Information Technology (IT) sector has achieved a historic milestone, with export earnings crossing the $4 billion mark for the first time during the first eleven months of the current fiscal year, underscoring the industry’s growing contribution to the national economy.

According to data, exports of IT and IT-enabled services, including income from software companies and freelancers, reached $4.184 billion during July–May of FY2025–26. This is higher compared to $3.475 billion recorded in the same period of the previous fiscal year.

The sector showed strong year-on-year growth of 20 percent, with export earnings rising by $709 million. This performance is especially notable given the difficulties faced by the industry during the year, such as internet disruptions and geopolitical uncertainty.

Analysts attribute the continued growth in IT exports to supportive government policies, tax incentives, and sustained efforts to promote Pakistan’s technology sector in international markets. Measures are aimed at facilitating foreign exchange inflows and attracting foreign direct investment (FDI) have also contributed to the sector’s expansion.

Congratulations Pakistan! ICT exports have hit a new record high in May’26! IT remittances totaled $ 4.18B in the first 11 months of FY25-26. Latest figures have surpassed the entire ICT export figure of FY2024-25 which was recorded at $3.8 B. Read more -> https://t.co/g4GKM4v14H pic.twitter.com/c25okUaxjj

— Ministry of IT & Telecom (@MoitOfficial) June 17, 2026

Despite a slight decrease in monthly inflows, export earnings from the IT sector remained strong. In May 2026, IT export receipts were recorded at $373 million, down from $423 million in April 2026.

With one month left before the end of the fiscal year, total IT exports are expected to reach close to $4.5 billion. However, they may still fall short of the government’s $5 billion target.

Commenting on the sector’s performance, IT exporter Dr. Noman Said said that Pakistan has major untapped potential to further increase IT exports and bring in more foreign exchange. However, he also pointed out that several structural issues are still preventing the sector from achieving its full growth potential.

He emphasized that the IT industry has emerged as a key contributor to Pakistan’s macroeconomic stability by supporting the current account balance, attracting investment inflows, and creating employment opportunities.

“Our country needs a comprehensive roadmap to strengthen the domestic IT ecosystem and sustain the impressive growth in exports,” he said. “This requires a robust education and training framework to equip the workforce with in-demand digital skills, while simultaneously exploring new international markets and deepening penetration in existing ones.”

The outlook for the IT sector remains positive after the government announced a series of incentives in the federal budget. One of the main steps is the extension of the 0.25 percent Final Tax Regime (FTR) for IT exporters for the next three years, which provides long-term stability and policy certainty for companies working in the sector.

In addition, the government has lowered the withholding tax on international transactions made through payment cards from 5 percent to 0.5 percent. Industry experts believe these changes will make it easier to do business, improve competitiveness, and help increase foreign exchange inflows into the country.

Chairman of the Pakistan Freelancers Association (PAFLA), Ibrahim Amin, said freelancers have played a significant role in driving the growth of IT exports, contributing more than 20 percent of the sector’s overall export receipts, crossing $1 billion.

He said that the number of freelancers and digital workers in Pakistan is continuously increasing as more students and young professionals become aware of freelancing opportunities and gain access to digital skills training.

He also added that in the future, the growing use of artificial intelligence (AI) and AI-related skills is expected to open new opportunities for Pakistani freelancers. This will further increase export earnings and help strengthen Pakistan’s position in the global digital economy.