IT exports soar: Pakistan
Pakistan is rapidly transforming into a global tech hub, driven by record-breaking IT exports, policy-driven innovation, and a thriving digital workforce. The government’s commitment to digital advancement aims to create a more connected, secure, and innovative future.
The Ministry of IT and Telecom remains dedicated to positioning Pakistan as a leading digital economy by fostering innovation, expanding connectivity, and ensuring universal access to telecom services.
According to official documents, “These efforts are creating a sustainable digital ecosystem, making Pakistan a rising tech hub.” Over the past year, Pakistan’s IT and telecom sector has seen remarkable progress, fuelled by government initiatives promoting digitalisation.
Key achievements include record IT exports of $3.223 billion in FY 2023-24, reflecting a 24 percent increase. Broadband penetration surged by 5 percent, benefiting over 139 million subscribers. Policies supporting AI, cloud computing, and digital entrepreneurship are empowering startups and freelancers.
Tax dept do not treat receipts of software
The income tax department has failed to treat the receipts under the software lease agreement as royalties under Double Taxation Treaties (DTTs). According to details, the foreign incorporated company declared the receipts under the software lease agreement as business profits in its tax returns and sought exemption from income tax in Pakistan under Article 7 of the Convention between Netherlands and Pakistan for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income, 1982. However, the tax department treated these receipts as royalties under Article 12 of the Convention and subjected them to income tax @15 percent.
Refineries planned investments of up to $5 bn
The multibillion-dollar plant upgrade projects of Pakistan’s refineries are at stake as the government has yet to resolve the issue of sales tax exemption on supplies of petroleum products.
The refineries have planned investments of up to $5 billion in upgrading their projects to ramp up local production and meet 100 percent demand of the country. At present, these refineries meet 30 percent of the country’s petrol requirement. With the adoption of the proposed policy, this coverage is anticipated to double in the next six years, reaching a substantial 60 percent of the total petrol demand following the installation of upgraded plants.
Similarly, for diesel supply, the refineries account for 50 percent of the country’s requirement. In the next six years, it is projected they will be able to double their capacity, resulting in domestic production catering to 100 percent of diesel demand without the need for imports.
10 MoUs and agreements with Indonesia on cards
More than 10 memoranda of understanding (MoUs) and agreements are likely to be signed between the two brotherly countries Indonesia and Pakistan soon, according to well-placed diplomatic and Foreign Office sources.
Both sides will also engage in talks to make progress on a free trade agreement (FTA) to further strengthen economic ties.
When it comes to high-potential sectors for trade growth, Pakistan may focus on processed food, pharmaceuticals, IT services and halal meat while consumer electronics, auto parts and processed palm-based products are far better in Indonesia.
In 2023, Pakistan exported goods worth approximately $328.16 million to Indonesia. Indonesia’s exports to Pakistan were valued at around $3.03 billion. Indonesia produces nearly half of the world’s refined nickel and two-thirds of the mined nickel; therefore, it intends to achieve a more prominent place in the world’s electric vehicle (EV) supply chain.
Sugar rates may soar to Rs200/kg
Sugar prices in Pakistan are expected to rise sharply in the coming weeks, potentially hitting Rs200 per kilogram, as the country faces a shortage of nearly 1 million tonnes. Currently, sugar is selling at Rs165-170 per kg in retail markets, up from Rs159 per kg in wholesale.
As of this week, wholesale sugar prices in Lahore stand at Rs159 per kg, while retail markets are selling it between Rs165 and Rs170 per kg, a sharp jump from Rs140-150 per kg just a month ago. Speaking to source, Hafiz Arif, President of the Kiryana Merchants Association, attributed the shortage to excessive exports of 700,000 tonnes of sugar over the past year. “Our current stocks are barely 5.8 million tonnes, but domestic consumption is rising. Exporting such large quantities has left us vulnerable,” he said.
He added that sugarcane recovery has dropped to nearly 12 percent, and the area of cultivation has also decreased by 20 percent this season. “This means estimates of total sugar production have been compromised, and market forces are predicting the per-kilogram sugar price to hit Rs200 soon. Currently, open-market or wholesale dealers do not have stocks; however, sugar mills do,” Arif added.
Committee reviews wheat output projection
The Cabinet Committee on Essential Crops on Wednesday reviewed the projected wheat production and national requirements and emphasised the importance of harmonising federal and provincial agricultural research systems to enhance per-acre yield and overall farm productivity.
The meeting of the cabinet committee was held under the chairmanship of Deputy Prime Minister and Foreign Minister Ishaq Dar. The team of the Ministry of National Food Security and Research was led by Federal Minister Rana Tanveer Hussain and Secretary Waseem Ajmal Chaudhry. On the occasion, the committee’s report on wheat policy for Rabi 2024-25 sowing season was presented and a detailed review of the projected wheat production and national requirements was undertaken.
Minister for Food Security Rana Tanveer Hussain briefed the committee on the cultivated area for the current year and underscored the importance of aligning agricultural strategies with domestic needs and farmers’ benefit. The committee discussed the proposal of harmonising federal and provincial agricultural research systems to increase per-acre crop yields and overall farm productivity.