The IT industry in Pakistan is sounding alarms over the significant financial losses caused by frequent internet disruptions, claiming that even a single hour of internet downtime results in a loss of more than one million dollars for the sector, including export businesses. In a media briefing on Tuesday, Pakistan Software Houses Association (P@sha) Chairman Sajjad Mustafa Syed highlighted the detrimental effects of these outages on the country’s IT service exports and expressed concerns over the potential long-term impact on international business relationships.
Syed revealed that authorities have acknowledged that Virtual Private Networks (VPNs) cannot be banned, as there is currently no law to support such a move. He emphasized that the IT ministry and Pakistan Telecommunication Authority (PTA) had been informed about the damaging effects of frequent internet slowdowns and disruptions. While these interruptions might seem inconsequential to the average person, Syed pointed out that in industries like stock markets, banking, and air travel, even brief delays can significantly undermine clients’ confidence. He warned that if international clients shift to other countries due to unreliable connectivity, it would be challenging to regain their trust and business.
P@sha has also expressed concerns over the growing number of IT companies relocating abroad due to Pakistan’s unreliable internet infrastructure. An internal survey conducted by the association showed that most of its members have experienced financial losses due to the instability of the country’s internet services. Foreign clients have also voiced concerns over the matter, further jeopardizing Pakistan’s position as a reliable hub for IT exports.
Syed referenced a study by NetBlocks, which estimates that an hour of complete internet shutdown in Pakistan can cost the country $2.21 million in lost revenue. He also cited a report by the Pakistan Institute of Development Economics, which estimated that the closure of 3G/4G services results in a direct daily loss of Rs 1.3 billion, excluding the indirect financial damage businesses face. This situation highlights the urgent need for a more reliable and consistent internet service to protect Pakistan’s IT industry.
The P@sha chairman also addressed the ongoing issue of VPN usage, suggesting that the introduction of VPN service providers could be a solution. By creating a new line of business, this approach could streamline the registration process for VPNs while maintaining necessary security protocols. P@sha has shared its technical proposal with the PTA and the IT ministry to ensure a smoother flow of internet services for IT companies, which are essential to the sector’s growth.
According to Syed, around 55% of Pakistan’s IT exports are directed to the US, with 20% to Europe, and the remaining portion to the Asia-Pacific and Middle East regions. He stressed that Pakistan needs to adopt IT security systems similar to those implemented in the US and European countries to secure its position in the global market. Syed cautioned against following the example of countries like North Korea, where stringent restrictions on internet access have had negative consequences for the economy.
