Code across the border ; Say hello to the 'pashas' of Pakistan's IT sector.

bIndia and pakistan share several things other than a violentpast and a contentious border. A common history, and a passion forcricket are just two of them. Now add a growing IT industry to thatlist.

At $3 billion, the Pakistan IT industry is much smaller than theIndian industry but we expect it to grow to $11 billion by 2011, says Jehan Ara, President, Pakistan Software Houses Association(PASHA). PASHA is Pakistan's only IT body with over 360 companies asmembers. Currently, close to a hundred thousand people are employedby the IT industry, which is growing at 40 per cent year on year.

Interestingly, half of Pakistan's revenues come from the domesticmarket which is growing at a rapid pace. In the export market, themain markets are the US, the Far East, the UK, Rest of Europe andthe Middle East. The software industry is spread across three citiesKarachi, Islamabad and Lahore. Tech MNC giants like IBM, Microsoftand Oracle have set up development bases in the country.

The cost of labour is Pakistan is 30 per cent lower than inIndia. In that sense, it's a great base for offshoring operations.The quality of talent is also very high. As a result, we have somegreat success stories in the country, says Ara. Recently, AdobeSystems invested in an Islamabad-based start-up called Scrybe. Thereare several exciting start-ups, especially in the product space inthe country, adds Ara who sees Pakistan creating its own niche inthe IT outsourcing space rather than competing with India.

Ara admits that the political uncertainty in the countrytranslates into additional energy expended in convincing companiesto invest in the country; but she is not overtly worried about thefuture.

Some of the largest IT companies in Pakistan have close to a1,000-odd employees and clock revenues in the region of $20-25million. So, we possibly will never be as large as India when itcomes to size of the industry. But we can collaborate when it comesto outsourcing, says Ara.

The salaries of IT professionals in Pakistan are approximately30 per cent lower than those in India, while telecommunication costsare also low as compared to any other offshore locations, which makePakistan an attractive outsourcing destination, reads a recentGartner report on the Pakistan offshore industry.

The report further stated that the government of Pakistan hadformulated a comprehensive IT policy to encourage the privatesector. The government plans to develop IT parks in major cities,while 750,000 square feet of space in the Pakistan Software ExportBoard (a government body to encourage software exports) has alreadybeen leased to IT companies.

T.V. Mahalingam