Pakistan is emerging as the destination of choice for IT outsourcing in Pakistan for the following reasons:

• An IT workforce of 133,000 with good English language and people skills growing at a phenomenal rate of almost 20,000 a year.

• A hundred and ten ISO-certified IT companies, with over 25 undergoing CMMI rating.

• A reliable digital telecommunications infrastructure with backup and reliable energy and transport networks.

• An ambitious program of world-class IT Parks, with a rental rate of approx. US$1 per sq ft /month.

• A prosperous economy that offers lucrative domestic opportunities and is attracting increasing amounts of international investment.

• A steadily improving risk rating and a tightening environment for intellectual property protection.

• A streamlined government regulatory process of one of the most attractive incentive programs anywhere, which includes tax exemptions, 100% foreign equity and earnings repatriation.

• International leaders such as BearingPoint, NCR Teradata, Mentor Graphics and ZTE have chosen to locate their development and consultancy center in Pakistan.

Government Incentives

In order to promote its IT industry, the Government of Pakistan has provided several incentives to investors. The establishment of a reliable IT infrastructure and the provision of an incentives package are instrumental in the development of the local IT industry.

Other benefits provided to the IT companies are in the form of tax holidays for 15 years and 100% foreign equity ownership. Because of these incentives, an increasing number of foreign IT companies have chosen Pakistan for their outsourcing operations. Some of the areas in which the Government is facilitating the private sector companies include:

• Information Technology Parks with low rent, fiber optic connectivity, libraries and conference rooms

• Provision of funds for software companies to get ISO-9000 and CMM-level certifications

• Foreign investors allowed 100% ownership of equity in "IT/ITeS companies"

• Tax exemption for IT companies till 2016

• 100% repatriation of profits allowed to IT companies

• Seven years’ tax holiday for Venture Capital funds

• The rate of depreciation on computer equipment is 30%

• The State Bank of Pakistan (SBP) has allowed the opening of Internet Merchant Accounts by banks

• Instant, reliable and high-speed connectivity available

• Over 85% of telecommunications infrastructure is on fiber optic cables

• Internet access is available in over 1862 cities/towns across Pakistan

• Pakistan is the first country in this region to establish DWDM telecommunications infrastructure

• Several cellular companies are using digital transmission (GSM and TDMA)

• The cost of 2 Mbps connection has been lowered to US$ 1000/month

• Redundant backup connectivity is available through PTCL for call centers.