Pakistan's information technology (IT) and IT-enabled services (ITeS) exports reached a record $4.6 billion during FY2025-26, reflecting a 21% year-on-year increase from $3.814 billion in the previous fiscal year. The performance marks the highest annual export earnings in the country's ICT sector, although it fell around $400 million short of the government's $5 billion target.

The record performance further strengthened ICT's position as Pakistan's largest services export sector, while the government continues to pursue its long-term objective of raising annual IT exports to $10 billion by FY2028-29 under the Uraan Pakistan initiative.

Industry experts attributed the growth to Pakistan's expanding technology ecosystem, competitive operating costs, increasing global demand for remote services and a favorable 0.25% final tax regime on IT export income. Pakistan now hosts more than 34,000 registered IT and ITeS companies, supported by a talent pool exceeding 600,000 IT professionals and freelancers, with major technology hubs in Karachi, Lahore and Islamabad.

The United States remained Pakistan's largest export destination, accounting for the majority of software and IT-enabled service exports, followed by the United Kingdom, the UAE, Canada and European markets. Industry leaders also identified significant untapped opportunities across the Gulf region, Europe, Japan, South Korea, Australia, Africa and Central Asia, particularly in artificial intelligence (AI), cybersecurity, cloud computing, fintech and digital transformation services.

Freelancers continued to play an increasingly important role, contributing an estimated $1.1 billion, or around 25% of total IT exports, during FY26. Experts, however, stressed the need to diversify export markets and transition from traditional software outsourcing towards higher-value services such as AI, enterprise solutions, automation and intellectual property development.

Pakistan has also accelerated efforts to build its AI ecosystem through the National AI Policy 2025, the proposed National AI Fund, new AI innovation hubs and expanded international cooperation, including closer collaboration with China and growing interest from US technology investors. While the sector's strong growth reflects improving competitiveness, industry stakeholders believe sustained policy reforms, investment in digital infrastructure, improved regulatory certainty and stronger intellectual property protection will be essential to achieving the country's $10 billion IT export target in the coming years.