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IT has become the foremost preference of the young generation as a career choice

By Syed M. Aslam
May 21 - Jun 03, 2001

Never before in human history anything has influenced the lives of so many so profoundly like the information technology. Through English, IT has become the most widely used acronym in the contemporary world cutting across any and all language barriers. In a country like Pakistan where English commands respect as language of the elite, the word IT is not only used by the savvy but is also innocuously peppered in otherwise colourless conversations to win instant respect and/or argument, to flaunt hi-tech prowess, etc.

Like elsewhere in the world, Pakistani society , too, has learnt to respect IT, and all those associated with it. It's obsession with IT has its basis in the deep seated premonition that nothing else guarantees a better route map to riches and success. That also explains why IT has become the foremost preference of the young generation as a career choice surpassing all other professions like engineering, medicine and also soon-to-be-former most preferred MBA degree. It has giving a focused direction to the younger generation which sees it as an equaliser in a country where academic choices have more to do with economics than one's talent, aptitude and temperament combined.

It is in this perspective that we have to look at the year 2000 which in retrospect would be remembered as the eventful year which gave IT the deserved, but long delayed, priority in Pakistan. The spider has just started weaving the intricate cobweb and the things look promising for IT to fast replace traditional trade and economy in Pakistan. So what justifies all this collective and personal optimism?

The adrenalin flow is triggered mainly by the priority which the current government is attaching to the IT and the measures that prove its sincerity: Universal internet access is available in over 400 cities and towns across the country today compared to just 29 less than nine months ago. Recently the government has promulgated an ordinance allowing a 15-year income tax holiday to software exports till June 30, 2016. Software exporters are also allowed now to retain 35 per cent of their earnings in foreign exchange accounts. The venture capital rules have been approved and venture capital companies are also granted a 7-year income tax holiday.

Accredition and quality testing councils are on the way to monitor workings of IT institutions in both public and private sector to ensure that they are imparting relevant and quality education. Internet bandwidth costs for software companies, IT institutions and cyber cafes have been slashed substantially and so it is for the Internet Service Providers. However, ISPs have passed only a portion of the benefit to their consumers.

The government has announced to establish Software Technology Parks in other cities of the country including Karachi, Lahore and Peshawar, besides the one already functioning at the federal capital Islamabad, by third-quarter this year at an estimated cost of Rs 20 million.

The financial size of IT including training, hardware/accessories and software (for both exports as well as domestic use) registered a healthy growth of 62 per cent from $ 197 million in 1999 to $ 319 million in 2000. However, the otherwise substantial growth doesn't tell the whole story as it conceals the fact that sectoral share of hardware and software for both the domestic as well as exports registered a decline. Except for training whose sectoral share increased by 5 per cent to 41 in the year 2000 over the previous year, the sectoral share of hardware decreased by 2 per cent from 49 per cent to 47, domestic market of software dropped by 1.6 per cent to 3.4 while software exports declined from 10 to 9 per cent during the comparative period.

The financial size of Pakistani telecom industry including listed phones, mobiles, Internet Service Providers, telecom equipment producers and payphone registered a net growth of 6.7 per cent from Rs 158 billion in 1998-99 to Rs 175 billion in 1999-2000. However, ISPs' contribution in the financial size and turn over of telecom industry was a negligible 4.6 per cent and 0.7 per cent respectively in 1999-2000.

The numbers of software houses and the volume of software exports are on the increase. Last year number of software houses of all shapes and sizes, from those employing 2-5 core professionals the developers to those employing over 50, increased to around 800 nationwide compared to some 660 a year previously. Similarly, the volume of software exports registered a 48 per cent increase from $19 million to $28 million during the same period. This fiscal it is expected to surpass $42 million. However, domestic software market increased by just 10 per cent from $10 million to $11 million.

The alarmingly low retention of IT professionals is another cause for concern. The local IT industry is able to employ less than 7 per cent of some 110,000 IT professionals of all types 62,000 certificate holders, 20,000 1-2 year diploma holders, 15,000 2-year degree programmers, 4,000 4-year degree programmers and 9,000 e-commerce specialists produced each year. The situation can be much worse as the above figures do not include 25,000 MS office and 5,000 networking. Japanese Jujitsu wrestling is the art of using opponent's strength against his ownself. Can the same strategy be used to turn the weakness of local IT industry into its very strength?