First ever Digital Policy of Pakistan approved by Federal Cabinet

In a historic feat, the federal cabinet has given approval of Pakistan’s first digital policy — “Digital Pakistan Policy” which will offer many incentives for the IT sector of the country. The approval of this policy was given in a meeting of the federal cabinet of the state which was chaired by Prime Minister of Pakistan, Shahid Khaqan Abbasi.

The draft of this policy was presented by the Minister for IT and Telecom (MoITT), Ms. Anusha Rehman to the federal cabinet. The new digital policy offers various benefits to the IT sector which we have extensively covered here. These include the income tax holiday, 5% cash reward on IT export remittances, 5% sales tax reduction on domestic revenues in federal territories and providing preferential bank loans to IT industry.

Pakistan Software Houses Association (P@SHA) has played a key role to convince the government to give approval to these major incentives in the history of Pakistan’s IT and Telecom industry. According to the reports, PM was initially reluctant on approving new Digital Pakistan Policy, due to the fact that elections are near and the next govt would be most suitable to decide on the matter. However, some representatives of P@SHA and Anusha Rehman convinced the PM about the importance of these incentives for Pakistan’s wellbeing. In a critical policy statement, he announced the incentives at NIC Karachi’s launch, a couple of weeks ago.

In addition to tax benefits, the IT/ITeS companies and call centers registered by Pakistan Software Export Board (PSEB) will be given 5% cash rewards on their net export remittances. This will indeed uplift export remittances of the country. Furthermore, the Ministry of IT and Telecom will suggest Federal Board of Revenue to develop Tech Special Economic Zones (SEZs). These SEZs will also be provided with lands by PSEB for a long-term lease for the development of technology parks in the country.

The new digital policy also aims to boost e-commerce sector in the country by developing an ecosystem where payment service providers (PSPs) and payment service operators (PSOs) will collaborate to form a more interactive e-commerce platform.

After the approval of the policy document, MoIT Anusha Rehman stated;

“Digital Pakistan’ Policy will serve as a catalyst towards a holistic digital ecosystem in the country with advanced concepts and components for the rapid delivery of next-generation digital services, applications, and content.”

Moreover, the Digital Pakistan Policy will also provide a basic framework to establish incubation centers across Pakistan to nourish technology startups so that they can more efficiently work on global trends like IoT, AI, and robotics etc. The PM has also directed MoITT to formulate a strategy to align the “Action Plan” for this newly devised policy. This action plan will set key indicators for monitoring, evaluating and implementing the first-ever digital policy of the country.

The Digital Pakistan Policy will pave the way forward for the country to drive its growth through digital economy.