By Munawar Iqbal
The IT sector in Pakistan is facing its lowest growth rate and one is not able to predict where the bottom is as the declining is worsening consistently. A recent survey by the World Economic Forum (WEF) shows that Pakistan has further fallen nine points. The survey report is indicative of a weak Information and Communication Technology (ICT) base of Pakistan, which has not become a serious consideration of the people at the helm of affairs.
Pakistan was ranked as on 84 two years back and last year it declined to 89 out of 127 countries and now it’s placed on 98 out of 134 counteries. The said report gauges a country’s connectedness in the global environment through its information and communication technology infrastructure. The rankings are based on the Networked Readiness Index, which measures the likelihood that countries will exploit the opportunities offered by information and communication technology services.
The report tries to comprehend the impact of ICT on the competitiveness of nations. Basically, ICT has encouraged transparency in government processes and improved countries efficiency and services to citizens. It also suggests that, in order to improve its network connectedness, Pakistan should invest more in ICT infrastructure related services. On contrary, this important sector of economy is being disregarded continuously from last couple of years or so for the reasons unknown to anybody.
Our contemporary world and especially, the countries belongs to our region have developed this sector remarkably well and showing a steadfast growth. Pakistan, except an initial take up, never made any concrete effort to capitalize the emerging opportunities. However, the Private sector has shown a commendable resolve to lift the sector at par with global advancements. But inconsistency and apathy at official level are no badly hampering this progress and the sector has been left alone and neglected even to struggle for its very survival.
Personal Computer density in Pakistan is already 1.5, which compares unfavorably with other countries of Asia-Pacific Region. Now, due to sharp increase in prices of PC and other computer accessories, it’s being feared that the percentage would decline further as common man finding it hard to purchase new computer.
Several reports suggest that Pakistan's PC/Server market experiencing a non-stop slowdown and its annual growth rate declines alarmingly. The countries who have shown futuristic approach vis-à-vis growth of this highly important sector of the economy, are formulating the policies aiming at maximum facilitation to the industry i.e. Turkey has exempted its Computer industry from GST, import duty and corporate income tax while allowed personal income tax for 10 years. Vietnam has given the industry exemption of GST and import duty besides 4 years exemption of corporate income tax and relaxation in personal income tax ranging from 3 to 35 per cent. Thailand and Malaysia have also offered similar sort of incentives to their industry which is being translated into steady growth of this sector in above mention countries.
The report of WEF must be an eye-opener for decision makers as it suggests that a coherent government vision on information and communication technologies, coupled with an early focus on education are keys to spur network readiness and to lay the foundations for sustainable growth. For a sustainable ICT sector, the people at the helm of affairs should have been working with close collaboration of the stake-holder. Thus, a balanced policy could have been envisaged. Unfortunately, it could not happen and this apathy has shaken the confidence of investors and destroyed the enabling environment of business as well.
Increase in the price of computers due to irrational taxation mechanics, has not only discouraged common man and students but it has also added the cost of doing business. The average price of PC reported by local assemblers and retailers increased up to 20%. This is one of the factors which have negatively impacted the growth of the IT sector which could be checked by available relevant official data of exports. The government needs to revisit the IT policy approved by the Cabinet in the year 2000, which was comprised on various incentives to promote the IT Sector of the country. However, most of the recommendations of this policy could never take the practical shape.
It’s worth mentioning here that the initial boom in the IT industry in Pakistan was somehow result of those forward looking policies where the IT sector was envisaged as the backbone of the economy. Those initial steps have made a positive impact on the domestic growth of the local IT and computer industry as well as its exports, but the derailing and reversing of the policy has resulted as huge damage for the industry as well as the interests computer literate community in the country, which needs to be strengthen instead of discouragement.
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