Digital Economy: A Technological Tool to Unlock Pakistan’s Growth
In an era where digital transformation is imperative, Pakistan stands on the brink of revolutionizing its economy through digital means. With a burgeoning youth population, a surge in internet usage, and a blossoming startup culture, the country is gearing up to harness the full potential of its digital economy for national growth and prosperity.
Experts emphasize the necessity of bolstering digital infrastructure to tap into this vast potential. The Information Technology (IT) sector, a pivotal player in the digital economy, is witness to remarkable growth, signaling a promising future for Pakistan in the global digital arena. According to the Economic Survey of Pakistan (2023-24), the IT industry’s annual exports hover around US$ 2.6 billion. However, to meet the ambitious goal of increasing these exports to US$ 15 billion over the next five years, a skilled workforce comprising at least 200,000 IT professionals is essential.
Muhammad Zohaib Khan, Chairman of the Pakistan Information Technology Industry Association (PITIA), stresses the importance of enhancing IT infrastructure and nurturing skilled manpower to fully leverage the digital economy. He underscores the necessity of modernizing the sector and expanding internet connectivity to align with international standards.
In recognition of the sector’s significance, the current government has allocated over Rs 79 billion to IT in the 2024-25 budget, marking the highest investment in the country’s history. This allocation aims to facilitate the sector’s growth, with exports projected to reach $3.5 billion this year. Plans to elevate these figures to US $7 billion in the upcoming years are underway, indicating a strategic focus on the IT and digital economy as drivers of economic development.
Internet penetration in Pakistan has seen a significant rise over the past decade, with 111.0 million internet users at the beginning of 2024, according to Data Portal. Social media usage too has skyrocketed, with 71.70 million users, accounting for 29.5 percent of the population. The number of cellular mobile connections has reached 188.9 million, indicating a deep penetration of digital connectivity across the country.
Ahsan Zafar Bakhtawri, President of the Islamabad Chamber of Commerce and Industry, acknowledges the current growth trajectory of IT exports, projecting it could reach US$ 5 billion in the next couple of years. An evolving digital economy, bolstered by the emergence of global IT companies, positions Pakistan favorably on the international stage. Bakhtawri emphasizes the critical need to weave global linkages to further strengthen the digital economy.
The startup ecosystem in Pakistan is thriving, with numerous incubators, accelerators, and co-working spaces laying the foundation for a robust digital economy. The e-commerce sector, in particular, has experienced rapid growth, driven by a surge in online shopping and digital payments. This growth is indicative of a broader digital transformation taking place across Pakistani society.
The proliferation of digital payment systems has opened up new avenues for convenient online transactions, marking a significant shift in consumer behavior. The government’s support in nurturing Small and Medium Enterprises (SMEs) in the IT domain is essential for maximizing the digital economy’s potential.
Pakistan boasts a vast talent pool of skilled professionals, including software developers, graphic designers, and content writers. Freelance platforms have become instrumental in connecting these talents with global markets, creating opportunities for earning foreign exchange while generating employment at home. Nawaal Chaudhry, a content writer, asserts that Pakistani IT experts are globally competitive, capable of making significant contributions if provided with the necessary expertise and opportunities.
The government’s Digital Pakistan program illustrates a commitment to fostering the digital economy, aiming to improve digital infrastructure and enhance digital education and skills. This initiative is a testament to the strategic importance placed on digital transformation as a pathway to economic prosperity.
As Pakistan continues to navigate its digital journey, the government’s supportive policies, combined with the country’s adaptive capacity, are key to unlocking the immense possibilities of the digital economy. Embracing digital innovation will not only propel economic growth but also pave the way for a prosperous digital future for Pakistan.
