Pakistan recorded its highest-ever monthly IT exports in April 2024, amounting to US$310 million.
This represents a 62% year-over-year (YoY) increase and a 1% month-over-month (MoM) rise from the previous highest of $306 million in March 2024.
IT exports in April also surpassed the 12-month average of $245 million.
According to a brokerage note, the year-over-year growth in IT exports is attributed to three key factors: the expansion of IT export companies in the GCC region, particularly Saudi Arabia; the State Bank of Pakistan’s relaxation of the permissible retention limit, increasing it from 35% to 50% in Exporters’ Specialized Foreign Currency Accounts; and the stability of the Pakistani rupee, encouraging IT exporters to repatriate a higher portion of their profits.
In the first 10 months of FY24, IT exports totaled $2.59 billion, up 21% from $2.14 billion in the same period of FY23.
Net IT exports (exports minus imports) also reached a record high of $283 million in April 2024, marking a 68% YoY increase and exceeding the 12-month average of US$214 million.
For the 10MFY24, net IT exports grew by 20% YoY to US$2.28 billion.
The increase in the retention facility to 50% was introduced by Pakistan’s caretaker government. At the time, the caretaker IT minister projected that this facility would boost IT exports by an additional $1.0 billion on top of the $2.6 billion recorded in FY23.
However, the target of $3.5-3.6 billion for FY24 is unlikely to be achieved, with IT exports expected to close at around $3.1-3.2 billion.
