According to data from Topline Securities, total IT exports in the first half of fiscal year 2025 were $1.86 billion, up 28 percent from the same period last year.  

Despite this significant progress, concerns have arisen about slow internet speeds and government crackdowns on VPN use. Since last year, the federal government has been implementing a national firewall, which aims to block harmful content and prevent cyberattacks.  

In particular, the government's crackdown on unregistered VPNs has created problems for businesses and freelancers. A deadline for VPN registration was set for November 2024, but it was later canceled and no new date has been announced.  

There are several important factors behind this growth in IT exports. These include the expansion of the global client base of Pakistani IT companies, especially in the GCC region, and the relaxation of the foreign exchange account limits. These measures have encouraged IT exporters to bring more profits home.  

Pakistan's central bank has also introduced a new category that allows IT companies to invest up to 50 percent of their foreign exchange earnings in equity abroad, further boosting confidence in the sector.  

However, there are concerns about the slow internet speed and the effectiveness of the national firewall in the long term. The Pakistan Business Council (PBC) recently warned that slow internet speed and the firewall could lead to multinational companies shifting their operations elsewhere, some of which have already been done.  

The Pakistan Software Houses Association (PASHA) said the IT sector's operating costs could increase by $150 million a year due to this problem. However, experts expect the IT sector to continue growing and predict a 10-15 percent increase in exports in fiscal year 2025. This growth could meet the export target of $3.5 to $3.7 billion.  

The government's 'Udan Pakistan' economic plan has set an ambitious target of reaching $10 billion in IT exports by fiscal year 2029. Achieving this target will require a compound annual growth rate (CAGR) of 28 percent per year.  

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