Pakistan is at the crossroads of Information Technology (IT) revolution. With the right emphasis at the budgetary level and proper implementation of IT friendly policies, we should very soon be among the leading IT destinations of the World. However, if faced with continued apathy at the hands of policy makers, the IT industry is bound to remain underdeveloped. The result would be that our economy will continue to suffer due to outdated practices in an environment of poor access to information for quick decision making and development.
A number of initiatives at the highest level have clearly laid out the path to achieving IT driven economic growth. The current IT policy is a voluminous and comprehensive document that addresses the challenges in helping IT play its due role in taking the country to a higher level of development. However, we have consistently failed in converting these ideas into action. This has been due to two main reasons, our failure to earmark priority at the budgetary level to vital expenditure in the area of IT, and our inability to properly utilize whatever funds were set aside.

The first issue, setting priority areas for earmarking budgetary funds, has suffered as a result of lack of understanding of the role that IT can play in the country’s development. It is chiefly in the following three main areas that IT can help transform the national economy:
•    Driving export based revenues and raising the much required foreign exchange for the country
•    Helping technology driven innovation and improvement in efficiency in different spheres of public and private enterprise
•    Paving way for greater social change and freedom for the masses through the use of IT for delivery of citizen centric services and creation of opportunities for the masses
As a result, the share of science and technology and IT education in the development budget remains historically low.

The second issue, inability to properly utilize funds allocated for IT development and automation, has been due to an inadequate capacity for managing such expenditures. The millions that have been poured into public sector departments in the name of automation have gone waste as a result of poor management and lack of clear ownership of such initiatives. Thus, to date, we have had few success stories, whereby automation has helped a government department reap significant benefits in terms of efficiency for its internal stakeholders and smooth services for its customers.

As a result, we continue to suffer in almost all leading areas of national economy, and perhaps the most in the agricultural and the industrial sectors, not to mention the missed opportunity to create a great employment potential for the country’s youth. Thus, year after year, lack of information prevents us from taking timely remedial action to save our crops or make informed interventions to properly price and distribute our produce. We already have witnessed complexities arising out of such a situation back in 2007 when the government exported wheat at a low price after having arrived at incorrect estimates, and later imported at a higher price from around the World. This situation will continue unless we document our crop production electronically.

The IT sector has continued to grow in spite of the absence of adequate support at policy level. Even last year, IT driven exports grew by 46%. The sector employs about 110,000 professionals, 15,000 of which are engaged in export oriented IT businesses. However, this performance is quite inadequate in view of the great potential for Pakistani IT industry in the emerging global economic conditions. Pakistan is an excellent position to develop its huge youth population, which forms about 60% of the total population of around 170 million. With proper IT education, this population can become the launching pad for IT driven development in the country, ushering in an era of greater self reliance and increased opportunities for the masses. This can be a vital step toward bringing about social change through reducing the imbalance in income distribution and improving productivity at national level. The Government can help improve social inclusion by providing greater opportunities to the underrepresented sections of the society, including the female population, rural citizens, and people with disabilities.

At the same time, the Government will need to show a commitment to automation, firstly to increase its operational efficiency and effectiveness, and secondly to raising its capability to extend citizen centric services. In addition to the direct benefits of such an automation drive in the public sector, the Government will also help in the growth of local IT companies through funding and capability development.

These are two vital areas that need to be addressed in the upcoming budget. Without adequate budgetary support, it will remain a weak commitment to development of IT in the country, and the economy will continue to suffer as a result of inadequate modernization and development. At the same time, however, the Government will need to put in place proper mechanisms to ensure that the budgeted amounts are fully and effectively utilized for the desired results. This would require proper ownership of IT driven change and a clear understanding among all stakeholders of the benefits sought from IT driven development. In order to ensure proper policy level intervention and monitoring, the Government will need to develop new data collection procedures regarding all IT related activities and expenditures.

In addition to above, some other steps would be required as well. Firstly, the Government will need to review its taxation of the computer hardware industry. Pakistan is among few countries in the world where General Sales Tax is imposed on computer hardware. It should be removed in the next budget. This will not only provide the required impetus to automation and uptake of technology at public level, but would also lead to further job creation.

Another vital measure is to immediately extend for another 10 years, the tax holiday for the IT sector, which will be expiring in 2016. The IT industry has benefited from this incentive, and its lapse could deal a serious blow to the nascent industry. The industry is already struggling to control costs in the present global financial environment. With Government support, it should be able to focus instead on producing better software for its export markets.

The Government of Pakistan has already formed a Task Force on Information and Communication Technologies (ICT). The task force aims to not only review the existing IT policy, but also recommend an action plan that covers all sectors of the industry. The various sectors being covered include software development and export, IT enabled services and BPO, computer hardware, IT education, use of Urdu language in IT, IT security and e-commerce, e-governance, and telecommunications and network infrastructure.

International research has highlighted that basic fundamentals for Pakistan’s IT industry are in place. With a strong visionary approach for leading Pakistan toward the forefront of the global IT industry, and proper budgetary and planning support, we should be able to rapidly enjoy the benefits of successful IT led development.

(The writer is Chairman Federal Task Force on Information and Communication Technologies, Honorary Consul of Australia for the province of Punjab and Chairman & CEO of NetSol Technologies Ltd)

(This article is a CIO Pakistan Web Exclusive)

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