IT Sector Faces $1M Hourly Losses Due to Internet Shutdowns

The Information Technology (IT) sector in Pakistan is incurring losses exceeding $1 million per hour due to internet shutdowns, according to Sajjad Mustafa Syed, Chairman of the Pakistan Software Houses Association (P@SHA).

Speaking to the media on Tuesday, the P@SHA chairman emphasized the need for stable infrastructure, improved market access, accommodative taxation policies, and skilled human resources to achieve the government’s $15 billion IT export target.

Syed highlighted that every dollar invested in market access yields a return of $49, as demonstrated over the past three years. The IT sector has grown by 40%, reaching $3.2 billion in exports, with 55% of these exports directed to the United States and 20% to Europe. He urged the government to invest in branding to unlock the sector’s full potential.

Syed expressed concerns about the impact of repeated internet shutdowns, noting that 99% of IT companies reported service disruptions and 90% experienced financial losses. Citing a recent case, he revealed that a single call center faced a $2 million penalty due to connectivity issues.

The chairman also addressed taxation challenges, stating that revenue-based taxes hinder growth and urging the government to introduce tax incentives to encourage remittances and investment.

On data security, he cautioned against free Virtual Private Networks (VPNs) and advocated for a regulated VPN service model to ensure security and industry compliance. He reiterated P@SHA’s role in aligning policies, stressing the importance of collaborative efforts rather than isolated decision-making.

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