Pakistan's technology exporters have never earned more, yet they are falling behind the government's ambitions. Exports of IT and IT-enabled services reached a record $4.6bn in the 2025-26 fiscal year, a rise of roughly 21% from $3.814bn the year before. That confirms information and communications technology (ICT) as the country's largest services export, but it left the sector about $400m short of the official $5bn target. Experts warn that growth is levelling off just as the industry needs to accelerate towards a goal of $10bn by 2028-29 under the Uraan Pakistan framework.
The picture is of an ecosystem that has matured but remains fragmented. Habibullah Khan, founder of Penumbra Digital, counts roughly 34,420 registered IT and IT-enabled services companies, around 600,000 professionals and freelancers, and more than 50 software technology parks and e-Rozgaar centres. The main hubs are Karachi, Lahore and Islamabad/Rawalpindi.
Estimates vary. Parvez Iftikhar, former chief executive of the Universal Service Fund, puts the number of companies registered with the Pakistan Software Export Board at over 26,000. He notes that talent is spreading beyond the big cities into places such as Faisalabad, Sukkur and Sialkot, with the skilled workforce exceeding 600,000.
Growth has been driven by a young workforce, low costs, demand for remote work, freelancing platforms, better broadband and a preferential 0.25% final tax on IT export income. Even so, Mr Khan says the five-year compound annual growth rate has hovered around 16%. Reaching aspirations of $15bn would require sustained annual growth of 25-30%. "Our growth is plateauing," he warns.
Software development, enterprise technology services, business-process outsourcing, call centres and freelancing dominate the export basket. Cloud services, cyber-security, AI, automation and digital consulting are growing quickly, while fintech remains strategically important though still largely domestic in its value.
Market concentration is a vulnerability. America takes more than 70% of software and IT-enabled services exports in some assessments, followed by Britain, the UAE, Canada, Europe, Saudi Arabia and Singapore. America, the European Union and the Middle East together account for nearly three-quarters of destinations.
Mr Khan sees untapped opportunities in Saudi Arabia, the UAE and Qatar, especially in government technology, fintech and cyber-security. He also highlights Germany and the Netherlands for Industry 4.0 and green-tech software, Japan and South Korea for higher-value work requiring language skills, and markets in Australia, Africa and Central Asia.
Saad Shah, chief executive of Hexalyze, argues that firms must diversify their offerings as well as their markets. That means moving beyond conventional web and mobile app development into AI, cyber-security, automation and enterprise solutions, and expanding in Gulf and South-East Asian markets.
Freelancers have become a significant force. Ibrahim Amin, chairman of the Pakistan Freelancers Association, says they generated about $1.1bn, or around a quarter of IT exports, by the end of 2025-26. Scarce jobs at home have pushed many professionals onto global platforms such as Upwork and Fiverr. He argues that a long-term national strategy for skills is needed.
There are caveats. Reports suggest that some freelancer income is misdeclared by companies seeking to benefit from the tax concessions available to freelancers. Pakistan also lacks a reliable, unified employment database, so the sector's true contribution is probably understated.
The economic case is nonetheless strong. Because most of the value consists of wages paid to Pakistani professionals and earnings that largely stay in the country, ICT exports compare favourably with textiles relative to their import content, with experts citing a figure of roughly $3.9bn. The sector also offers around 32,000 technical vacancies at any time, according to Mr Khan, and remote work has widened opportunities for women, young people and those outside the major cities.
Kapeel Kumar, founder of The Founders Space, frames the task as moving from volume to value. Pakistan, he says, is still seen largely as an offshore coding shop rather than a home for core intellectual property. "The next $5 billion won't come from working harder with more developers," he argues, but from owning intellectual property, embedding AI natively and turning task-takers into global product creators.
The government has laid foundations for an AI push. The National AI Policy 2025 includes a proposed National AI Fund, centres of excellence, regulatory sandboxes and a goal of training 200,000 people a year, or about 1m by 2030, with 10,000 trainers by 2027. The National AI Advancement Initiative has launched online training and, more recently, seven AI hubs to incubate hundreds of start-ups.
China is a central partner. It can supply telecoms equipment, cloud and data-centre technology, hardware, inference computing and research, and the two countries share a Joint Working Group on IT. In July 2026 Pakistan became a founding member of the China-led World Artificial Intelligence Cooperation Organisation. Mr Khan cautions that co-operation must build domestic capability rather than permanent dependence on a single vendor.
Connectivity has improved markedly. Pakistan now has six submarine cable systems and one terrestrial link, with installed capacity roughly doubled to about 17.7 terabits per second under the current IT minister, alongside 20 operational cross-border fibre links. The priority now is resilience: multiple routes, reliable domestic fibre and fewer disruptions.
Western interest is growing but modest. A Pakistan-US Tech Investment Conference produced initial commitments of more than $20m, mostly from American firms led by Pakistani-American entrepreneurs, and Britain is engaged through trade dialogues and technology missions. Large-scale investment by global cloud giants, however, has yet to materialise.
The barriers are familiar: policy uncertainty, taxation, foreign-exchange restrictions, payment friction, unclear data protection, weak enforcement of intellectual property, high energy costs, unreliable internet, security concerns and difficulty repatriating capital. Unless these are addressed, the gap between Pakistan's record earnings and its ambitions may keep widening.