Pakistan Tech Exports Continue to Soar: Up 40% in last 6 Months Amid COVID19 Pandemic
Pakistan's technology exports are continuing to soar amid the Covid19 pandemic. Tech exports jumped 43% in December, 2020 and 40% in July-December 2020 period over the same period in 2019. This is a rapid acceleration from 21% increase in all of Fiscal Year 2020 (July-June 2020) over FY 2019. Tech exports (up 40%) far outpaced overall exports (up 5.1%) in this period.
The modest 5.1% increase in Pakistan's overall exports is still commendable in the midst of the global economic devastation caused by COVID19 pandemic. What is even more commendable is the 19% jump in exports in December 2020 over the same month in 2019, indicating a strong upward trend.
|Pakistan Tech Exports Soared in First Half of FY 2020-21. Source: Commerce Department|
Total monthly ICT exports hit a record $194 million in December 2020, up 43% from $135 million in December 2019. For the entire 6 month period from July-December 2020, the ICT exports reached $958 million, up 40% from the same period a year earlier. Tech services exports now account for a third of all service exports of the country.
|Pakistan Tech Services Export Share of Service Exports. Source: Commerce Dept|
Pakistani diaspora sent home $14.2 billion in remittances in July-December 2020, up 25% from the same period in 2019. Pakistanis settled in the United Kingdom and the United States increased their remittances by 52% and 47% respectively in this period, helping Pakistan achieve a record $1.8 billion current account surplus in the first 6 months of the ongoing fiscal year 2020-21.
|Remittances From Pakistani Diaspora. Source: Arif Habib|
While Pakistan's exports increased a modest 5.1%, the remittances from overseas Pakistanis jumped a hefty 25% in response to an appeal by Prime Minister Imran Khan who remains very popular among them. He drew nearly 30,000 Pakistani-Americans to a rally during his Washington D.C. visit in 2019.
|Pakistan Trade 1H of FY 2020-21. Source: Arif Habib|
Pakistan's imports increased 5.5%, more than the 5.1% increase in exports, during the first half of the current fiscal year 2020-21. This resulted in $12.4 billion trade deficit, a 5.9% increase. Without the 25% jump in remittances, Pakistan would most likely have a current account deficit rather than a surplus in this period.
The modest 5.1% increase in Pakistan's exports is still commendable in the midst of the global economic devastation caused by COVID19 pandemic. What is even more commendable is the 19% jump in exports in December 2020 over the same month in 2019, indicating a strong upward trend.
Pakistani diaspora is the world's 5th largest with more than half a million Pakistanis migrating every year to work overseas. Over 11 million Pakistanis have left home for employment in Europe, America, Middle East and elsewhere since 1971, according to Pakistan Bureau of Emigration. The pace has particularly picked up over the last 10 years. This phenomenon has helped reduce unemployment in a country where about 2 million young people are entering the job market each year. It has also helped remittances soar nearly 28X since the year 2000.
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