Pakistan’s IT and IT enabled services sector recorded its highest ever export earnings during fiscal year 2025-26, generating US$4.6 billion from software houses, business process outsourcing companies, export oriented technology firms and independent freelancers. The latest figure represents a 20.6% increase from US$3.8 billion recorded in the previous fiscal year and marks a significant expansion in one of Pakistan’s fastest growing sources of foreign exchange. IT exports have increasingly become an important component of the country’s external earnings, with technology based services allowing Pakistani companies and professionals to sell internationally without the physical supply chains required by traditional export industries.
The sector also recorded strong monthly performance toward the end of the fiscal year. IT and IT enabled services exports reached US$416 million in June alone, representing an increase of nearly 23% compared with the same month a year earlier. The performance reflects growing demand for services delivered by Pakistani technology companies, software developers, digital professionals and freelancers to clients in international markets. Unlike conventional merchandise exports, these services can be delivered electronically across borders, allowing Pakistani businesses and individuals to generate foreign exchange from within the country without moving physical goods through ports or customs infrastructure.
A significant characteristic of the IT sector is its high trade surplus. The industry operates with an estimated trade surplus of around 85%, meaning a substantial portion of the foreign exchange generated through technology exports does not require equivalent imports of raw materials. Traditional export industries often depend on imported machinery, energy, raw materials or intermediate goods before finished products can be sold abroad. Technology services operate differently because much of their value is created through human expertise, software, digital infrastructure and intellectual capability. Developers, designers, consultants and other technology professionals can therefore create export value while working from Pakistan and serving customers located in markets around the world.
The government has increasingly identified technology exports as a strategic priority as part of its broader digital economy agenda. Prime Minister Muhammad Shehbaz Sharif has chaired high level reviews focused on technology exports and has set a target of developing a US$25 billion digital economy by 2030. The government’s approach has included measures intended to reduce operational barriers for technology exporters, improve access to foreign currency and make international transactions easier for companies and independent professionals operating in the sector.
Federal Minister for IT and Telecommunication Shaza Fatima Khawaja has also been involved in measures aimed at creating a more supportive environment for technology businesses. These include extending the 0.25% final tax regime for the sector until 2029 and increasing foreign currency retention for exporters to 50%. The measures are intended to give technology companies and freelancers greater flexibility in managing foreign exchange earnings and international payments. Easier cross border payment arrangements and incentives aimed at attracting investment into artificial intelligence infrastructure are also part of the broader policy direction.
The government’s digital economy strategy extends beyond conventional software and IT services, with artificial intelligence and other advanced technologies emerging as areas of future investment. A National AI Policy has been introduced alongside a planned US$1 billion investment in artificial intelligence by 2030. The country is also expanding fibre connectivity and preparing for broader 5G deployment, providing digital infrastructure required by technology companies, cloud services, AI applications and other data intensive activities. The Islamabad IT Park is also expected to open soon, while the expansion of software technology parks is intended to provide additional infrastructure for technology businesses.
Talent development remains another major component of the sector’s expansion. Government supported programmes have delivered more than one million training opportunities across advanced digital disciplines, creating a larger pool of workers capable of participating in international technology markets. The development of specialised skills is particularly important as demand increasingly moves beyond basic outsourcing toward areas such as artificial intelligence, cloud computing, cybersecurity, semiconductor technologies and advanced software development. Building these capabilities could allow Pakistani technology companies to compete for higher value international contracts.
The Pakistan Software Export Board (PSEB) has also expanded programmes aimed at strengthening the country’s technology talent pipeline. In February 2026, a two day national AI training bootcamp reached more than 2,000 students, with global technology companies including IBM, Huawei and Google participating in the initiative. The programme was designed to expose students to advanced artificial intelligence skills and provide additional opportunities for young professionals entering the technology sector.
Pakistan has also begun developing a specialised workforce for the semiconductor industry. A national semiconductor workforce programme, launched relatively recently, has already enrolled 475 graduate engineers and is targeting a total of 7,200 trained professionals. The initiative reflects the government’s intention to expand the technology sector into advanced industries beyond software services. Developing semiconductor expertise could create opportunities in chip design and other specialised areas as Pakistan seeks to establish a presence in a highly technical global industry.
Through its Tech Destination Pakistan programme, PSEB is also working to connect Pakistani technology companies and professionals with international markets and major technology platforms. The initiative aims to improve the visibility of Pakistan’s technology sector and create opportunities for local companies to secure international clients and partnerships. Greater access to global technology markets could support further growth in IT exports while allowing Pakistani firms to move toward higher value services.
The record US$4.6 billion in IT and IT enabled services exports demonstrates the growing contribution of the digital economy to Pakistan’s foreign exchange earnings. The sector’s ability to generate export revenue primarily through skilled human capital and digital infrastructure distinguishes it from traditional goods based exports. With policy support, expanding connectivity, specialised training and investment in emerging technologies, Pakistan’s technology industry is positioned to remain an important component of the country’s export strategy and broader economic development.
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