The Rise Of Pakistan’s Tech Services Exports

In 2020, the world economy hit an interesting inflection point: India exported more software and tech-enabled outsourced services than Saudi Arabia exported oil. Now, 2020 was a global pandemic year, and many things about it were very different, so it was a point easy to ignore. But when it happened again in 2023, it was starting to become clear: the nature of what was valuable, and what allowed a nation to generate income, was changing.

Pakistan’s software and tech-enabled outsourced services business is laughably behind that of India, and we do not think a comparison is particularly helpful. Indeed, we will lay out the numbers up front just so that the lack of comparison can be laid to rest. In 2023, India exports $250 billion worth of these services. Pakistan exported $4.3 billion.

So perhaps Pakistan’s tech and outsourced services industry will not be quite as globally significant as to eclipse Saudi Arabia’s oil exports. But a smaller goal – and one that would make all our lives a lot better – is more within reach: having Pakistan’s tech and outsourced services exports exceed Pakistan’s own imports of oil and gas.

Pakistan’s goods exports have been growing highly anemically, at a measly average of 3.6% per year in between calendar years 2006 and 2024, according to data from the State Bank of Pakistan. During that same period, Pakistan’s tech and tech-enabled outsourced services industry’s exports grew by 12% per year.

And they did it without being crybabies about it, unlike the textile exporters who cannot get out of bed in the morning without asking for a government subsidy.

This is the story of how an industry spent decades trying to get a foot in the door of a market dominated by its next door neighbour, one whose growth was – and is – mostly being strangled by the government, but one that, if left alone, can help the country achieve macroeconomic stability like no other industry can. We will then also explore ways that individuals could help expand the industry’s scope.

 Origins of Pakistan’s tech industry

The first computer arrived in Pakistan in 1964: an IBM 1620 mainframe, intended for use by the Pakistan Atomic Energy Commission (PAEC). It was initially meant to be used at the Lahore office of the PAEC, but since the only Pakistani citizen at the time who could operate it was a native of Dhaka, it was moved to the Dhaka office.

Following that first computer, several other government organizations were able to procure computers, and eventually, by the 1970s, many banks in Pakistan had them, and an initial computer industry started taking off in the country.

By the 1980s, a handful of upper middle class households in Pakistan started being able to afford desktop computers, which some used as the opportunity to learn more about software development. Famously, the world’s first computer virus was developed in Lahore in 1986 by the brothers Amjad and Basit Alvi, who developed it mainly out of intellectual curiosity, and naively put their names, address (in Allama Iqbal Town) and telephone number on the virus.

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