INITIATIVES AND THE TARGET
From SHAMIM AHMED RIZVI,
July 30 - Aug 05, 2001
The development of Information Technology and
Telecommunication industry is the cornerstone of the present
government policy and numerous measures have been taken during the
past about 15 months to develop these industries on a fast track.
This was observed by Prof. Dr.Atta-ur-Rehman,
Minister for Science & Technology, in an exclusive interview to PAGE
in his office in Islamabad last week.
The Minister claimed that what has been achieved by
Pakistan in months has been achieved by other countries in years and
"if we continue with our present pace of development we will
catch up with advanced countries in this field in the next five
years". An IT trained force of 100,000 youngmen and women will be
preparad in the next three years to achieve the target software export
of 1 billion dollar. Out of seven IT Universities planned, two have
already started functioning and three more will be operational by the
end of current year. The seven universities, on being fully
operational by the end of next year, will be producing about 50,000/-
IT graduates every year. Replying to a question the Minister said that
the government was fully conscious of the fact the cost of IT
education in recognized IT institutions was beyond the paying capacity
of the parents belonging to lower middle or even the middle class
living within the honest means. "We have already started
scholarship and Qarz-e-Hasna schemes to ensure that talented students
were net denied IT education because of financial constraints. The fee
charges of the seven IT universities being set up in public sector
will not exceed Rs. 2000/- per month", he added.
Continuing he said the government of Pakistan is
aware of the fact that the country is lagging behind in the
international IT race and is therefore, implementing a well thought
out and structured strategy to bring Pakistan into the digital map of
the world. In this regard, we have broken new ground and changed many
established paradigms to get to where we are in this short time. We
have also established a target of achieving US $ 1 billion of IT
services export by the year 2005 so that the efforts remain goal
oriented and achievable. Prof Atta-ur-Rehman claimed that the response
to our initiatives has been overwhelming and Pakistan has been able to
attract local and foreign investment in the IT sector. Internationally
recognized names like IBM, Sun Microsystems, Cisco, Microsoft,
Motorola, have already set their foot on the soiI and numberous others
are planning on setting up their operations in Pakistan. The
investments/projects that have shown tangible progress in the past 1
* Align Tech has established its off-shore
operations as well as the first call center (100+agents) at Lahore.
* Cisco has set up a full-fledged office.
* Microsoft negotiating a multi million $ investment package with GOP.
* Oracle planning to invest $ 20.00 million in training in Sindh.
* $ 10 m Telehousing Project with Akhter Group, UK being set up.
* IBM planning to invest Rs.200 million in IT education.
* Commitments from CERN, Geneva and World Bank
* Huawei Technologies to invest $ 2.5 m in IT Center in Pakistan.
* Motorola to invest $150 m in expanding its cellular network,
* ZTE to establish a software development center in Pakistan.
In addition, the local software industry has shown
progress too. The benefits likely to accrue from the recently
concluded ITCN Asia 2001 are estimated to be US$ 500 million. MOUs
worth US $ 300 million were signed while business under negotiation
reported by exhibitors is US $ 200 million. All of these indicators
point to a healthy and growing IT industry in Pakistan which has
resulted in considerable employment generation within the IT industry
and allied sectors, Dr Atta added.
Major milestones achieved during the past year are
* Information Technology and Telecommunications
Division was established, which started functioning on 1st July 2000.
* IT Policy & Action Plan was approved in August 2000
* Commitment for Rs. 5.00 billion was made for next 3 years and Block
Allocation of Rs. 200 billion was made in PSDP for fiscal year
* Key Areas of Development focus are.
A. Human Resource Development — more than
60% of the total IT budget being spent on this sector.
B. Infrastructure development.
C. IT Industry, Products, Services, Software
Development and Exports.
D. E-Commerce, E-Government.
Human Resource Development is the most important
area of IT Policy and Action Plan and that is where 2/3rd of our
resources are planned to be invested. In this regard, 48 projects have
been approved and an amount of Rs.1,462 million has been committed to
date, out of which Rs.415.87 million have been disbursed towards
various ongoing projects. By the end of June 2001, an additional sum
of Rs.487.85 million would be disbursed, bringing the total
disbursement to Rs.1040.72 million for the current fiscal year. Some
of the projects being undertaken are listed below:
* Training of 10,000 Data Entry Operators 9,000
trained and more than 80% absorbed by the industry.
* Training of Medical Transcriptionists.
* Java Training Program.
* Internetworking Training Program.
* Attracting women to the field of IT and special arrangements for
their training at different levels.
* Re-Training of Public Service Professionals and officials in IT
(degree and short term courses have been started).
* Scholarships and Qarz-e-Hasna for IT Human Resource Development
(1,070 per year for BCS/MCS programmes).
* Master Plan for Scholarships and Qarz-e-Hasna for IT students (3,000
Institutional capacity building
A very important aspect of the IT policy and Action
plan is institutional capacity building so that our vision of
producing 100,000+ IT trained workforce can be realized. In this
regard, many programmes have been launched such as:
* IT Visiting Faculty Hiring Program
* Strengthening and Capacity Building of IT Departments in
Universities all over Pakistan.
* Virtual IT University for Distance Learning.
* IT TV Channel
* Establishment of IT Universities throughout the country.
These programmes would help in strengthening the
infrastructure of IT departments of existing public sector
universities and establishing of IT departments in these universities
where they don't exist. This infrastructure enhancement would allow
the universities to target a broader student body for
training/retraining. Top quality IT faculty is a major bottleneck for
most public/private sector universities and we have launched
programmes to attract good quality faculty from home and abroad, for
short and long term commitments whose service could be utilized in our
training programmes. A very important step in this direction is the
establishment of Virtual IT University for Distance Learning, based
out of Lahore, with campuses in all four provinces and the Azad
Kashmir. The project has been approved by the CDWP recently. This
university is being established at Lahore in the near future and would
help address the issue of lack of top quality IT faculty to a large
extent. In addition, 7 IT universities are also being established. Two
of them have already received charter namely, COMSATS and National
University of Emerging Science and Technology. Two more are planned
for NWFP and others are being set up in the Northern Areas, Sindh,
Punjab and Balochistan.
The Pakistan Army has already donated brick and
mortar infrastructure for establishing of one of these universities in Abbottabad.
In the field of IT industry development following
key initiatives have been taken.
* A Software Technology Park is already functioning
at Islamabad. STPs being set up in Peshawar, Karachi, Islamabad and
Lahore — likely to become functional shortly.
* Business Incubator established and functioning in Singapore.
* Establishment of Business Offices and Incubators in San Francisco
and plans for setting up such offices in New York, London, Tokyo and
* Pakistan Software Export Board being re-structured in consultation
with private sector stakeholders.
* IT companies allowed 15 year tax exemption — already announced by
the Chief Executive.
* Software Exporters allowed to retain 35% of their earnings in
Foreign Exchange accounts.
* IT industry related equipment import made duty free.
* Nationwide IT Survey conducted by Gallup. Results being analyzed
* Venture Capital Funds rules approved. VC Funds granted 7 years
income tax holiday.
* Five major VC funds launched in private sector.
* SECP rules for IPO of tech stocks modified.
* Banks and DFIs providing financing options for the IT sector
Contracts accepted as collateral for export finance facility.
* Accreditation and Quality Testing Councils being set up to ensure
quality of IT education in the public and private sector.
* IT contracts will be awarded only to 100 per cent Pakistani-owned
entities or to joint ventures where the government is convinced that a
genuine transfer of technology will occur — Chief Executive's
* Mega IT Exhibition — IT Commerce Network Asia 2001 held at Karachi
in March. It was visited by more than 350,000 visitors. The visitors
included 25,000 local and overseas visitors from corporate and public
* A number of seminars, exhibitions and workshops organised
by the private sector — Dawn Newspaper Group organised a 2 days
Software Exhibition at Karachi on 23-24 January attended by well over
* UNDP sponsored seminar on IT and Software development being held in
Lahore in September 2001.
Infrastructure for IT industry is another important
area and due attention is being accorded for its development.
Fortunately, PTCL and private sector operators have implemented
development plans in the past decade, so the improvements required are
mostly in terms of structural adjustments, add-ons and not greenfield
projects with long gestation times. The structural improvements
brought about under the IT Policy and Action plans have all shown
positive results on the growth of IT industry. Some of the important
projects undertaken in terms of infrastructure development are:
* Reduction in Internet bandwidth costs — from $
60,000 to $ 6,000 p.m / 2Mbits for software companies, educational
institutions and call centers.
* Delivery period for leased line reduced to 4-8 weeks from several
* Universal Internet Access — from 29 cities in August 2000 to over
350 cities / towns.
* PTCL is planning on leasing a 155 Mbps Internet backbone which would
be available to users by June 2001.
* Internet delivery on Cable TV has been permitted which would result
in substantial increase in Internet use.
* Simplified registration process for setting up of call centers.
* DSL deployment in local loop for broadband Internet access —
* Educational Intranet being set up.
* Long awaited mobile phone service of PTML (Ufone) launched on 29
January 2001 with overwhelming response from the public.
* Calling Party Pays (CPP) regime introduced for the cellular industry
to accelerate the growth of mobile phones.
* PTCL's prepaid card service launched.
* VoIP Project being finalised.
* The concept of speclal discounted package was introduced during
Ramzan and Hajj season for domestic long distance and international
* License processing time period for telecom services reduced to 7
days from severai months.
* Local call radius in Karachi and Lahore increased to 35 km.
* Balochistan connected to the nationwide fiber optic backbone
* Infrastructure for IT / ISPs (PRIs and Digital Cross Connect) being
enhanced by PTCL.
* Customer care and new billing solutions system being launched by
* Approval of NTC Project to provide infrastructure for e-Government
De-regulation and increased private sector
participation is a key objective of the Government policy for
telecommunications. Pakistan also stands committed to its WTO
obligations and is planning to open up the telecommunication market to
full competition by the year 2003. Due to the sensitivities involved,
a high level task force has been set up by the Ministry of Science and
Technology with representation from all key stakeholders. The task
force is advising the Ministry on the best options for implementing
deregulation in the telecommunication sector. It is expected that the
telecommunication sector alone will see an exponential growth once the
market is fully de-regulated, attracting global investment and opening
up numerous job opportunities in the country.
The E-Government initiative has been undertaken by
the Government of Pakistan to improve efficiency, quality,
transparency in functioning of the Government and also serve as
training ground for the thousands of IT professionals being trained in
the country. Implementation of these projects would also provide an
opportunity for local IT companies to gain experience in domestic
projects before they are able to vie for projects in the export
markets. Major initiative underway on the E-Government front are:
* Preparation of E-Government architecture and
identification of projects to be undertaken in 2000 - 2002.
* Training of Government Officers and officials in IT.
* Consultants being appointed at Karachi, Lahore and Islamabad to help
in preparation of IT projects for provinces.
* E-Government Master Plan ready for approval and implementation.
The developed world is moving towards a paperless
economy and for countrles like Pakistan to be able to participate in
the global economy, it is imperative for us to develop an electronic
commerce infrastructure so that business can be conducted via
electronic means. Initiatives in the realm of E-Commerce can be
summarized as follows:
* Internet Merchant Accounts allowed by the State
Bank of Pakistan.
* Awareness and training programme of stakeholders for E-Commerce
implementation in Pakistan launched.
* Project for Enabling exchange of Electronic Commercial documents by