Pakistan’s information technology (IT) sector expects exports to reach $4 billion in the current fiscal year and seeks regulatory reforms and a 10-year tax holiday to sustain growth momentum, said the country’s top software association on Saturday.

The IT sector is one of Pakistan’s priority industries as the country looks to boost export revenues and stabilize its external accounts.

Under the government’s “Uraan Pakistan” initiative, launched last year in December, Islamabad aims to raise IT exports to $10 billion by 2029.

Industry leaders say IT remains one of the few sectors capable of exponential growth despite the broader economic challenges.

“Muhammad Umair Nizam, Senior Vice Chairman of Pakistan Software Houses Association (P@SHA), has apprised that information technology has become the fastest growing export industry of Pakistan – and, the country is set to achieve $4 billion in its IT exports for the FY25,” the software association said in a statement, adding that Pakistan’s IT exports stood at $3.2 billion in the last fiscal year with the prospect for a 25% year-on-year growth.

However, P@SHA warned regulatory bottlenecks and inconsistent tax policies were hampering the sector’s expansion at a time when new tech sub-sectors were emerging.

The association said it had also submitted detailed budget proposals to the government, seeking a facilitative framework that includes streamlined foreign exchange regulations, banking sector support, removal of sales tax anomalies and accelerated development of special technology zones and IT parks.

Pakistan’s IT industry is the only sector with a trade surplus of around 75%, the statement said, underlining its potential to create jobs, develop skilled human capital and reduce the trade deficit on a sustainable basis.

The software association also raised concerns over income tax disparities between salaried employees and freelancers, saying the current structure discourages formal employment and needs urgent correction in the upcoming federal budget.