Pakistan’s IT Sector Faces Over $1 Million Loss per Hour Due to Internet Shutdowns
Pakistan’s Information Technology (IT) sector has incurred losses exceeding $1 million per hour due to repeated internet shutdowns, according to Sajjad Mustafa Syed, Chairman of the Pakistan Software Houses Association (P@SHA).
Speaking to the media, Syed emphasized that Pakistan’s goal of achieving $15 billion in IT exports is directly tied to market access, infrastructure stability, tax policies, and skilled human resources. He stressed that for every dollar invested in market access, the return has historically been $49, citing patterns observed over the last three years. The IT sector has grown by approximately 40 percent, reaching $3.2 billion in exports. Notably, 55 percent of these exports are directed to the US, followed by 20 percent to Europe.
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However, Syed pointed out that branding efforts are essential to unlock the sector’s full potential, urging the government to make strategic investments in this area.
Regarding the impact of internet shutdowns, Syed revealed that 99 percent of firms reported service disruptions, with 90 percent facing financial losses. He shared a significant example, explaining that a call center alone suffered a $2 million penalty due to a recent internet outage.
Syed also raised concerns about the sector’s taxation policies, stating that taxes on revenue are detrimental to the growth of the industry. He called on the government to introduce tax incentives to foster investment, encourage remittances, and facilitate the sector’s expansion.
Lastly, Syed warned against the security risks of using free virtual private networks (VPNs) and recommended a more secure approach, suggesting that the government adopt an industry-friendly VPN service provider model. He added that P@SHA plays a critical role in policy harmonization to ensure the sector’s growth, emphasizing that policies should not be created in isolation.
