Pakistan’s information technology (IT) exports for the month of January 2023 dropped by 23 percent month-on-month (MoM), the lowest since May 2022.
According to sources, IT exports for January 2023 stood at $190 million due to a gap between exchange rate markets.
The computer services’ exports went down by 20 percent, whereas the telecom services’ exports witnessed a fall of 35 percent in January 2023, the sources added.
Moreover, exports related to computer software declined by 25 percent, whereas software consultancy decreased by 15 percent in January 2023.
The decline in IT exports is a sign of a decline in global IT spending. Gartner, a technology research and consulting group, has lowered its growth prediction for IT spending from an earlier 5.1 percent to 2.4 percent in 2023.
Year-on-year (YoY), IT exports for January 2023 increased by 2% due to an 8% YoY increase in telecom services. The exports for January 2023 are the lowest since May 2022, which were $184 million. The amount is below the 6-month rolling average of $221 million.
On a broader level, a slowdown is being witnessed after April 2022, with YoY growth averaging 3 percent from May 2022 to January 2023, compared to an average of 32 percent YoY growth in the prior nine-month period of August 2021-April 2022.
The IT ministry of Pakistan has set an export target of $5 billion for FY23. The current fiscal year's monthly average run rate of $218 million indicates that Pakistan will miss the export target by a big margin.
In 7MFY23, IT exports are up 2 percent year over year to $1.52 billion. A slight increase has been attributed to a 3% YoY increase in computer services to $1.22 billion.
As a result of the MoM decline in January 2023, IT exports have declined to 6.8 percent. That is compared to 6.2 percent in January 2022 and 8.1 percent in December 2022. In 7MFY23, the total IT exports stand at 7.4 percent, compared to 6.9 percent in 7MFY22.