Road to Digital Pakistan

Thriving societies have historically invested heavily in agriculture, recognizing it as the backbone of their economies and a vital source of sustenance.

However, as the global economy evolves, many of these same societies are now shifting their focus to the IT sector, recognizing it as a key driver of economic growth and development. In this transition, the emphasis is on harnessing technology to fuel a booming economy, leveraging the immense potential of information technology to propel nations into the future.

In recent weeks, Pakistan has highlighted the challenges its IT sector is facing, revealing cracks in what is one of the country's most rapidly expanding industries. The IT/ITeS (Information Technology and IT-enabled Services) sector is a significant contributor to Pakistan's economy, accounting for approximately one per cent of the nation's GDP, which translates to around $3.5 billion. Remarkably, the sector has doubled its output over the past four years, and experts project it to grow by another 100 per cent within the next two to four years, potentially reaching $7 billion.

However, this growth, while impressive, pales in comparison to neighbouring countries like India and Bangladesh, where the IT sectors are expanding at a much faster pace. This disparity underscores the need for Pakistan to address the challenges in its IT infrastructure and policies to remain competitive in the regional and global markets.

If Pakistan’s internet issues persist in the coming weeks, the country could face significant economic losses. The Pakistan Software Houses Association (P@SHA) has warned that ongoing internet disruptions could cost the economy up to $300 million.

This alarming figure is tied to the broader issue of the country's recent internet struggles, which have already had a substantial impact on IT exports. In June alone, Pakistan recorded $298 million in IT exports, marking a 33 per cent increase from the previous year. For the fiscal year ending in June 2023, IT exports were valued at $3.2 billion, up from $2.5 billion the previous year. However, these gains are at risk if the current internet disruptions continue, threatening the momentum of this critical sector.

The recent disruptions have brought the country to a standstill, revealing just how dependent Pakistan has become on a stable and reliable internet infrastructure. During a meeting of the National Assembly’s Standing Committee on IT on August 21, 2024, the PTA chairman responded to my questions by clarifying that it was the government’s web management system undergoing an upgrade, not the implementation of a firewall, as some had claimed. He dismissed concerns that the internet was being deliberately shut down. Despite these explanations, the ongoing issues continue to raise serious concerns about the country’s ability to maintain a reliable IT infrastructure.

The government must understand that while Pakistan is a thriving agrarian society, the future is IT. This realization is crucial if Pakistan is to fully leverage the potential of its burgeoning IT sector. The disruptions have had a profound impact on the more than 500,000 freelancers in Pakistan who rely heavily on mobile data to conduct their work. These freelancers represent not just individual workers, but 500,000 families who depend on their income. The ripple effect of these disruptions can be felt across the economy, as many of these freelancers are key contributors to the country's foreign exchange earnings.

Pakistan is one of the largest suppliers of labour to the global online workforce, ranking as the third largest according to the University of Oxford’s Online Labour Index. In a country where decent employment opportunities are scarce, many young men and women have turned to freelancing, offering their skills to international clients via the internet.

This not only provides them with a stable income but also brings much-needed foreign exchange into the country. However, the reliability of Pakistani gig workers is now under threat due to internet issues. Their once-strong reputation is being undermined, and both rights activists and industry experts have warned that implementing restrictive measures like a firewall could have unintended consequences, potentially jeopardizing the country's standing in the global digital economy.

If the government truly wants to support the younger generation, it must invest in the IT sector. This means not only ensuring a stable and reliable internet infrastructure but also fostering an environment that encourages innovation and growth in the tech industry. Without these investments, Pakistan risks being seen as an unreliable partner in the global digital economy.

Such a perception could lead to a significant loss of foreign exchange and stifle the growth of the IT sector, which has the potential to be a major driver of economic development. The government must avoid short-sighted policies that, to address immediate concerns, could end up causing long-term damage to the country's economy and push more young people toward disillusionment and unrest.

Furthermore, political stability is a crucial ingredient for nation branding, which is essential for attracting foreign direct investment, boosting international trade, and fostering partnerships. Political stability underpins the sustained development of key sectors, including IT, and is vital for achieving long-term economic growth. Without it, efforts to promote Pakistan as a reliable and attractive destination for business and investment are likely to falter.

Despite the current challenges, Pakistan’s IT sector has immense growth potential. With a talented workforce, a solid infrastructure, and a dynamic ecosystem of innovative start-ups, Pakistan is well-positioned to become a significant player in the global tech industry. The nation has the resources and the talent to build a thriving IT sector that can compete on the world stage, but this will require strategic investments, sound policies, and a commitment to overcoming the obstacles currently hindering progress.

In the words of Bill Gates, "the internet is becoming the town square for the global village of tomorrow." For Pakistan, embracing this vision means recognizing the vital role that the IT sector plays in the country's future and taking the necessary steps to ensure that it can flourish. As the country moves forward, it must prioritize the development of its IT sector, ensuring that it remains a pillar of economic growth and a source of opportunity for its people.

The writer is an MNA and a member of the National Assembly's Standing Committee on IT. She holds a PhD in law.