Pakistan and Philippines Top Outsourcing List
Menlo Park based oDesk has ranked Philippines and Pakistan as the top two outsourcing destinations in terms of growth, value for money and customer feedback.
oDesk helps its clients with tools, technologies and services to hire and manage remote work teams. Other companies in its category, including Elance, Guru and RentACoder, create marketplaces in which employers and freelancers can contact one another. These sites often manage the payments, and make money by charging membership fees and/or take a cut of the payment. The cuts can range from 4 percent to 15 percent.
According to oDesk, Pakistan experienced 328% growth in its outsourcing business in 2007-8, second only to Philippines (789%) on a list of seven top locations that include US (260%), Canada (121%), India (113%), Ukraine (77%) and Russia (43%).
Pakistan ranks number one in value for money for developers and data entry and number two overall behind the Philippines where the cost of answering calls is about half of the cost in Pakistan. Pakistan is well ahead of India and just behind the number 1 ranked United States in customer satisfaction.
The growth of outsourcing within the US and Canada as well as the high customer satisfaction data for North America are particularly noteworthy. It seems to indicate that more and more North American companies are showing preference for outsourcing close to home. New technology appears to be helping close the cost gap between North America and the rest of the top seven outsourcing destinations.
In addition to oDesk's view of Pakistan as a preferred outsourcing destination, Gartner, in its 2008 report ‘Analysis of Pakistan as an Offshore Service Location’ said the major factor behind upgrading Pakistan to first tier status for outsourcing is the lower salaries and better infrastructure advantages than other offshore destinations. “The salaries of IT professionals in Pakistan are approximately 30% lower than those in India, while telecommunication costs are also lower as compared to any other offshore locations, which make Pakistan an attractive outsourcing destination.”
oDesk says that "the results … the Philippines and Pakistan rank the highest in this admittedly simplistic analysis, which must be taken with a grain of salt." It adds, "There are many factors to be taken into consideration when hiring contractors to your workteams. But, in the meantime, congratulations to providers in these two countries for topping the list! Fans of outsourcing to the Philippines and Pakistan will also be glad to know that they were also the fastest growing countries on oDesk, by hours worked, from 2007-2008."
Here are two videoclip about Outsourcing to Pakistan:
Jinnah's Pakistan Booms Amidst Doom and Gloom
Pakistan's Foreign Visitors Pleasantly Surprised
Start-ups Drive a Boom in Pakistan
Pakistan Conducting Research in Antartica
Pakistan's Telecom Boom
ITU Internet Data
Pakistanis Join Hunt For God Particle
NEDUET Progress Report 2008
Pakistani Entrepreneurs in Silicon Valley
Musharraf's Economic Legacy
Should Pakistanis be Proud of Their Country?
ISLAMABAD, Jan 18: Pakistan is not likely to face any adverse effect from US president-elect Barack Obama’s proposal to stop giving tax breaks to companies which ‘ship jobs overseas’.
In his speech after election victory, Mr Obama had said that as president he would stop giving tax breaks to companies that shipped jobs overseas and start giving them to businesses that would create work opportunities for the Americans.
That probably spelled trouble for Singapore, Philippines or India’s large outsourcing industry, which got most of their revenue from the US, compared to a very small portion received by Pakistan.
IT experts here see no threat, especially because the $300 billion outsourcing industry was growing five per cent a year.
“America will be shooting itself in the foot by implementing the policy,” said Pakistan Software Houses Association president Jehan Ara.
“This is one of the things they always say. Bush said it twice, once in each of his terms. It may be a politically correct thing to say, but not good for business,” she said.
“If we can continue to deliver on quality and innovate in cutting-edge technology, which our outsourcing companies are doing, then there can be no impact on the outsourcing business in Pakistan,” she said.Pakistan’s IT industry has been growing steadily for three years. A marked increase in software export is an indication of the potential of this booming industry.
Estimated to be worth more than $2 billion, the information technology industry engages more than 15,000 professionals in export-oriented activities - software development and call centres.
More than 1,300 businesses registered with the Pakistan Software Export Board (PSEB) were supporting a mission of delivering high-quality and cost-effective IT solutions through quality engineering, analysts said.
Besides, medical transcription and healthcare outsourcing, the sector is growing stronger in delivering services such as financial insurance, accounts outsource mortgages, retail and media and entertainment as well as engineering design.
Asif R. Rizvi of the Digital Prodigy, IT consultants and outsourcing partners even predicts better times for the country’s outsourcers, despite Mr Obama’s pledge to give no tax sops to companies that outsourced work beyond their boundaries.
“The concerns are exaggerated. Impact will be stronger in the US because businesses are already in recession. They need to cut costs and only offshore outsourcing offer that best. In fact, the next two to three years are going to be very good because they will need cheaper well-trained IT personnel from this region,” said Mr Rizvi.
PSEB managing director Talib Baloch said: “Our companies need to realise that opportunity has knocked on their doors. It’s not just the US but the whole world that is looking at Pakistan and India to outsource businesses. Pakistan can sweep the market because it is cheaper than any other country in the region, Philippines or Singapore. It is 35 to 40 per cent cheaper than India.”
In his opinion, the US was not in a position to ban outsourcing.
“It’s a massive hundreds of billions of dollars market. Even if it does, Pakistan does not rely only on the US for the outsourcing business. Pakistani companies have diversified and penetrated into other markets that will soon dominate the US, like South America, Europe, South East Asia, Japan and the world’s fastest growing IT hub, the Middle East that is a colossal $73 billion sector and growing.”
Mr Baloch believes that at a time when the world is desperate for change, Pakistan needs to tap this potential.
“Businesses will survive only if they invest in technology for efficiency and advancement and cost benefits. Outsourcing offers all that,” Mr Baloch said.
I think Philippines deserves to be in the top of the list, not just for their capabilities but also for their hardwork and dedications.
Thanks for the post.
KARACHI: Pakistan could play host to an extreme growth spurt in the information technology industry in the next 10 years, according to a study quoted by IBM’s Country General Manager Hamayun Bashir.
Speaking at a ceremony held to celebrate a century of IBM’s existence on Thursday, Bashir informed Pakistan may have up to one million jobs in the information technology industry by 2020.
“IBA students are working on a study with assistance from the Overseas Investors Chamber of Commerce and Industry’s IT committee. The report, to be published in a few months, underlines that by 2020, Pakistan can easily have a million jobs and exports of $10 billion in the IT industry,” he asserted.
He expressed hope that the current figure of 0.15 million jobs in the industry could easily be increased. “I see a bright future for our industry, which is producing top-quality software,” said Bashir.
“We are meeting the IT ministry on behalf of Pasha – the chamber for IT in the country – to get officials to refocus on the sector,” said Bashir.
Commenting on the resignation of former IT minister Babar Awan, he said, “The minister was an important, focal point of the industry.”
“I have heard that the United States Agency for International Development (USAID) is providing funds and a data centre will be created in Islamabad,” he said while talking about the e-government programme.
Replying to a complaint that large organisations in the country, such as banks, did not give projects to local firms, he said that there were up to 60 large companies in Pakistan which needed tried and tested software.
He, however, explained that there were at least 10,000 small companies that would not be able to afford services of large international firms and would have to adopt local software solutions, which would help the economy grow.
This places Pakistan in 4th place on CII-Insead's Global innovation efficiency sub-index, 5 places ahead of India in 9th place, according to Economic Times of India:
India has improved its ranking in the global Innovation Efficiency Index to 9th position in 2011 from 101th last year on factors like political stability, R&D, market and business sophistication, according to a study.
Surprisingly, Pakistan was placed ahead of India at 4th position, the CII-INSEAD study said.
However, India has slipped on its ranking in the Global Innovation Index to 62nd position out of 125 countries in 2011 from 56th last year while Switzerland was at the top,
It said that a lot of Indian talent is returning home to the country and the youth in urban India are now more global than ever, "and they are quite in tune with new technologies, even ahead of the curve in many cases, as early adapters".
"Multinational corporations are making large investments in R&D outside of their headquarter countries, setting up R&D sites in low-cost emerging countries such as China and India to access global talent and take advantage of their proximity to target markets," the report said.
Indian major players such as Tata, Godrej, and Mahindras are shifting their focus towards the rapidly expanding middle-income group of customers by coming up with frugal innovations, keeping in mind the price sensitivity of Indian consumers, it said.
..From business process outsourcing to developing smartphone apps, Pakistani IT professionals are seem to be going after every opportunity, especially in the online job market, to bring home valuable foreign exchange.
In high demand, Pakistani IT professionals are growing significantly on oDesk, a Silicon valley-based online marketplace, in terms of both revenues and subscriptions to the platform.
“Pakistan is one of our largest contractor bases, and it is growing steadily,” CEO Gary Swart said in reply to queries through email. Contractors in Pakistan earned almost $1.5 million on oDesk in January 2012 alone, he said. “That figure is more than double the $700,000 they earned in January 2011, which is really an impressive growth!”
In January 2012, Swart said, more than 4,500 contractors from Pakistan signed up for oDesk, which enables businesses to hire, manage and pay a flexible online workforce, representing significant growth over previous months.
The top five categories of oDesk that work in Pakistan, according to the CEO, are web programming, web design, search engine optimisation, software development and mobile apps.
“In these five categories alone, contractors from Pakistan earned $796,000 in January 2012.” The number of Pakistani professionals that sign up for oDesk is growing steadily at a rate of 11% month over month, he added.
As seen from the top five job categories for Pakistani contractors, Swart said, there is certainly a large demand for their IT skills on the oDesk marketplace – which was the seventh fastest-growing company of Silicon Valley in 2011, according to the Silicon Valley Business Journal.
oDesk, according to Swart, is world’s largest online marketplace – as measured by dollars earned by contractors each month – and has 1.6 million registered contractors where 120,000 new jobs are posted each month. Contractors earned more than $225 million on oDesk last year, he said.
IT services are definitely a sweet spot for the oDesk marketplace in general, Swart said. The top two job categories on oDesk overall – web development and software development – together make up more than half of the total earnings on the platform, and demand for IT skills continues to grow rapidly.
Pakistan’s IT industry, according to Pakistan Software Export Board, has seen steady growth over the last few years despite sluggish economic growth – thanks to the online job market.
IT and IT-enabled services exports stood between $560 million and $860 million last year, according to former managing director of PSEB Imran Zia. On a Y-o-Y basis, the IT sector has been growing at 15% to 20% for the last three years and the growth in 2011 was about 15%. The future outlook for Pakistani IT professionals looks promising as IT jobs are in high demand on oDesk, where subscription rate of Pakistani contractors is growing steadily.
“IT jobs are our most in-demand category – which means we have significantly more IT opportunities for contractors from all countries, Pakistan included,” Swart said. “So we believe that we have more Pakistani IT professionals than any other online work marketplace,” he added.
“Pakistan is the third largest country using the website [freelancer.com], closely following India and the United States,” said Adam Byrnes, International Director at freelancer who joined the ceremony through a video call from the company’s headquarters in Sydney, Australia.
“Pakistani freelancers have already earned more than $13 million from the platform,” he said.
Freelancer’s decision to launch the local website comes on the back of strong growth in subscriptions by Pakistani freelancers. The website presently has 240,000 Pakistani users.
According to a report prepared by freelancer, self-employed Pakistanis surged from 33.3% to 39.9% between 2009 and 2012. The report attributes this surge in subscriptions to the rise in internet use in Pakistan, which saw double-digit growth in the past five years. In terms of internet growth, Pakistan stands second in the Saarc region, the report said.
“I am excited about the launch of freelancer.pk because of the potential Pakistan represents for the platform,” said Byrnes who is responsible for expanding freelancer across the world. “This [Pakistan] is a high value market for employers abroad.”
With more than 30 million internet users, five million plus broadband users and a population approaching 200 million, according to Byrnes, it makes sense to have a presence in Pakistan.
“Going forward, we want to provide self-employment for a billion people, a significant portion of that is going to come from Pakistan,” he said.
Freelancer just hit seven million users globally and 4.2 million projects were facilitated by the website, Muhammad Umer Farooq, company director responsible for managing the freelancer website told The Express Tribune on the sidelines of the event.
“An amount of $150 million has been spent so far by users of freelancer.com,” he said, adding they make money by charging commission from both the employers and the freelancers who get projects.
Interestingly, Farooq pointed out, it is not only foreigners hiring Pakistani freelancers, but Pakistani companies are also giving contracts to Pakistani freelancers registered on the website. United States is the top country awarding 38% of total projects on freelancer while Pakistan stands fifth for it awards 4% of the projects.
The idea is to enable rupee transactions for Pakistani members for which the company is in talks with local banks, both Farooq and Byrnes said. “Secondly, we are soon going to have an Urdu version of the website,” Farooq said.
IT and graphic designing (logo design) are the top two categories at freelancer. Freelancers can bid for the projects posted by employers through a simple method, he said. Given that it is one of the top countries on the website, Pakistani freelancers can benefit from exposure to the international job markets – the UK, North America, Australia and Canada.
Sabeen Mahmud has short-cropped hair and rectangular glasses; she’d fit right in hunched over a laptop at Philz or behind the counter at one of Apple’s Genius Bars. Her resume matches her style. She’s founded a small tech company, opened a hip coffee shop and organized a successful hackathon. But Mahmud doesn’t hail from the Bay – she lives in Karachi, a city more closely associated with extreme violence then entrepreneurs.
“Fear is just a line in your head,” Mahmud says. “You can choose what side of that line you want to be on.”
Mahmud represents something new in this ancient city. Mahmud “fell in passionately in love” with the first Mac she saw, teaching herself MacPaint and MacDraw in college in 1992, and devoting countless hours to Tetris. In 2006, Mahmud decided Karachi was sorely missing a space where people could gather around shared interests, an interdisciplinary space for collaboration and brainstorming. Despite the fact that in Pakistan, many women are not allowed to finish primary school, much less graduate from college and start their own company, she decided to start The Second Floor café, not letting the fact that she didn’t have any money or experience faze her. “I was living with my mother and my grandmother at the time,” she says, laughing. “I had done zero market research. I just hoped people would show up.”
People slowly have. The Second Floor now hosts four events a week, from poetry writings to live theater performances to forums on critical issues. Last month,the café hosted Pakistan’s first hackathon, a weekend-long event with nine teams focusing on solutions to civic problems in Pakistan ahead of last Saturday’s national election. “People are very disillusioned with mainstream politics right now,” Mahmud says. “We wanted to come up with a way to put that energy to use.”
Starting with 30 high-level problem areas, they whittled it down to nine specific issues that could be solved with concrete apps. “Not a single soul questioned that these problems could not be solved,” Ahmed says. “It was all a matter of selecting the right approach.”..
.. Before becoming an entrepreneur, (Maria) Umar was a full-time teacher. She quit after her job refused her maternity leave and subsequently began writing for a woman she found through Rozee.pk, Pakistan's premiere job portal. The money was good — almost double what she made as a teacher — but when Umar discovered her employer's oDesk profile, she realized she could make even more money by contracting with clients directly.
She set up her own oDesk account and began taking on extra jobs and outsourcing them. At first she gave the jobs to her nieces, then to their friends, and eventually to their classmates, until she realized that she had developed a small content-creation business.
Today, this company is called The Women's Digital League, an IT-solution company that trains rural Pakistani women in micro online tasks, from ghost-writing to social media management.
Ovidiu Bujorean is the Senior Manager of the GIST Initiative, which supports entrepreneurship in the Middle East, Asia and Africa. He met Umar after she won a GIST business plan competition, and recognized her ability immediately. "She is extremely passionate and persistent," he says of Umar. "She’s also very committed to her mission of helping female entrepreneurs find job opportunities...
First meeting of the Services Trade Development Council took place in the Ministry of Commerce, which was chaired by the Engr. Khurram Dastgir Khan, Minister for Commerce. The Minister said that Ministry of Commerce would put in place the regulatory framework necessary for enhancing the exports of services from Pakistan. The Council will consult the State Bank of Pakistan to devise a suitable mechanism to facilitate these IT professionals to bring the wages of their work to Pakistan directly.
In order to effectively market the Pakistani Technology industry, the Ministry of Commerce will enhance the participation of Pakistani IT companies in the international trade fares and exhibitions. The Government will also take measures to enhance the capacity of the free lancers working from their homes and small offices providing IT services to foreign clients. The Minister said that the Ministry will train its trade officers abroad to effectively market the Pakistani Technology industry.
The meeting also agreed to take necessary steps to enhance tourism especially religious tourism in the country as Pakistan hosts remains of various ancient civilisations and religions for example Indus Valley Civilisation, Gandhara, pertaining to Hindus, Sikhs, Buddhists and other religions. The Council suggested taking measures to enhance intra-SAARC trade of services which is currently very low.
Meeting was also attended by the representative of Ministry of Information Technology and Telecom, Secretary Trade Development Authority of Pakistan, representatives of Pakistan Software Houses Association for Information Technology, Pakistan International Freight Forwarders Association, Travel Agents Association of Pakistan, Insurance Association of Pakistan and Constructors Association of Pakistan.
Pakistan’s tiny IT sector is carving out a niche for itself -- so much so that it has been the subject of several stories in international publications such as the New York Times, the Global Post, Al Jazeera, to name a few. Perhaps the interest is because of the obvious potential of the industry: There are now 1,500 registered IT companies in Pakistan, and 10,000 IT grads enter the market every year.
Perhaps even more significantly, the democratisation of demand as facilitated by the internet-era, has enabled Pakistan to climb up market ranks to become the No. 3 country for supplying freelance programmers, behind only the United States and India, and up from No. 5 just two years ago. This is because programmers in Pakistan can easily sign up to platforms such as Upwork or Fiverr, where the person hiring them is less interested in their location and more concerned with their skill. Because the programmer in Pakistan is using a third party platform, logistical, bureaucratic and other constraints that are typically associated with Pakistan, including corruption, do not apply.
As reported by The New York Times, Pakistan ranks in the upper 10 to 25 percent on Upwork’s listing of growth rates for top-earning countries, alongside India, Canada and Ukraine. Pakistan’s freelance programmers already account for $850 million of the country’s software exports; that number could go up to $1 billion in the next several months, says Umar Saif, who heads the Punjab IT Board and previously taught and did research work at M.I.T.
As reported by the Global Post, Pakistan’s software export industry employs some 24,000 people, according to government figures. Most companies in Pakistan’s IT sector — including mobile game studios — are growing at more than 30 percent a year, says Pakistan’s software industry trade body, P@SHA.
With success come challenges, and Pakistan’s nascent IT industry faced its first such challenge last May, when news broke that Axact, one of Pakistan’s largest IT companies, was operating as a fake degree mill. Authorities acted fast, arrested Axact’s chief within days, though the controversy did lead many to comment on whether the country’s IT industry stood a chance in the long-term.
That question was answered almost immediately, when just three days after the Axact controversy, Naseeb Networks International, a Lahore-based company that runs the online job marketplace Rozee.pk, announced that it had won a third round of investments worth $6.5 million, from the European investment firms Vostok Nafta and Piton Capital. The latest round of funding brought the company’s total venture capital funding to $8.5 million.
Or take the example of Caramel Tech Studios, a Pakistan-based mobile game startup that created the sensation “Fruit Ninja” for an Australian developer. Another such startup in Pakistan is Mindstorm Studios, maker of “Whacksy Taxi,” a racing game that topped Apple’s App Store in more than 25 countries.
And while constraints such as bureaucracy, shortage of land/space for offices, power shortages, et cetera remain a challenge, they are offset by positives, most importantly cost. “If we have a million dollars in the bank ... in the US we might only be able to make one and a half games, whereas here we might be able to make 10 games,” Saad Zaeem of Caramel Tech Studios told The Global Post, adding that graduates here are as qualified as Western ones and cost a lot less to employ, giving software startups a competitive advantage over high-wage Western countries.
Further, the rise of the mobile software market has been a huge gamechanger. “Prior to the iPhone …
Pakistan’s freelancing industry is thriving
By Parvez IftikharPublished: October 30, 2017
Minister of State for IT Anusha Rehman, together with Ignite CEO Yusuf Hussain, recently announced the ‘DigiSkills’ Program that “would help the youth of the country to earn a reasonable livelihood as freelancers”.
The country-wide programme to train a million freelancers is ambitious and challenging. A somewhat similar endeavour, called ‘eRozgar’, was launched by Punjab IT Board Chairman Dr Umar Saif earlier this year.
The PITB had announced that it would be running a co-working space to train 10,000 young women and men with the help of experienced freelancers in different parts of Punjab. The MoIT’s programme is much larger in scope covering the entire country, albeit with an online, rather than physical, delivery mechanism. Both, however, appear to be great initiatives.
But all these “successes” have so far been achieved without freelancing being recognised as a profession. Enterprising Pakistani young men and women have been doing wonders exclusively on their own – without any opportunities to get trained, or even formally learn from each other.
In order to provide employment to many more Pakistanis, and to increase their earnings, there are numerous important skills that need to be taught (including soft skills like better English). This is where schemes like DigiSkills and eRozgar come in. One hopes that these initiatives will help turn millions of educated countrymen into productive individuals.
Prime Minister Shahid Khaqan Abbasi inaugurated the Digi Skills programme on Thursday, aimed at imparting ICT training to one million youth through online modules.
Addressing the ceremony, the Prime Minister said the present government has delivered in many fields by building motorways, ports, airports and power plants but the advancement in information technology sector is its most important contribution in the last five years.
The premier said that the Digi Skills programme will equip youth to get online jobs and earn money in a non-traditional manner. He said that he has full faith in the youth of the country and expressed confidence that women in particular will lead in e-commerce and digital skills.
The world is changing fast due to a revolution in information technology, he noted, adding that it is the government's responsibility to fully facilitate the private sector to take initiative and lead the way.
He said that the government on its part remains committed to ensuring availability of broadband in every inch of the country.
Speaking at the inauguration ceremony, Minister of State for Information Technology and Telecommunications Anusha Rehman hailed the Digi Skills program as an important step forward in the sector. She said the program will create online employment opportunities to enable youth to earn 200 to 300 dollars per month.
She further pointed out that Pakistan is emerging as an IT leader in the world, and with the help of this program, youth from across the country will be providing their services to the entire world.