IT Outsourcing - Pakistan

Pakistan

Revenue in the IT Outsourcing market is projected to reach US$715.80m in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 10.85%, resulting in a market volume of US$1,198.00m by 2029.
The average Spend per Employee in the IT Outsourcing market is projected to reach US$8.66 in 2024.
In global comparison, most revenue will be generated in the United States (US$197.30bn in 2024).

Key regions: Netherlands, United States, Japan, Germany, Italy

Definition:
The IT Outsourcing market refers to the external contracting of IT functions, services, or projects instead of relying on company-owned resources. By outsourcing IT tasks (e.g., to IT suppliers or software developers), enterprises are able to focus on their core functions and save internal resources and costs (e.g., office space, maintenance, and utilities). Thus, outsourcing teams becomes a viable cost resilience strategy in an environment where companies are looking to save money more than ever.

In an IT context, these activities include IT administration, IT application, and web hosting services. Non-IT-related outsourcing services are excluded.

Structure:

IT Outsourcing contains four distinct markets that are based on different services:

Administration Outsourcing refers to the market for services associated with the external sourcing of typical IT administration tasks such as hardware supply, setup, configuration, maintenance, security, and support.
Application Outsourcing refers to the market for all IT application services in a software production context, spanning from requirement assessments to concept and design of software applications.
Web Hosting includes all types of internet hosting services that allow companies or individuals to provide access to their web page via the World Wide Web.
Other IT Outsourcing refers to aggregated revenues of the types of IT outsourcing that are not specifically mentioned in the other IT Outsourcing markets, such as infrastructure outsourcing, network outsourcing, and managed services.

Additional Information:

The IT Outsourcing market comprises revenues, revenue change, average spend per employee, and revenues of the outsourcing types. Market values represent revenues that are generated by primary vendors either directly or through distribution channels at the manufacturer price level (excluding VAT). Reported market revenues include spending by enterprises (B2B) and governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed. Key players in the market include IBM, Accenture, Capgemini, NTT, and Hewlett Packard Enterprise.

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Market

Region

Region comparison

Currency

Analyst Opinion

Pakistan, a country in South Asia, has been gradually emerging as a leading destination for IT outsourcing. The country's IT outsourcing market is developing at a steady pace, and this trend is expected to continue in the coming years.

Customer preferences: One of the main reasons behind the growth of the IT outsourcing market in Pakistan is the country's large pool of skilled and educated IT professionals. Pakistani IT professionals are known for their proficiency in various programming languages, including Java, Python, and C++. Moreover, the country's IT outsourcing services are cost-effective, making them attractive to customers looking to outsource their IT projects.

Trends in the market: Pakistan's IT outsourcing industry is witnessing a shift from traditional IT services to more specialized services, including cloud computing, artificial intelligence, and blockchain. This shift is driven by the increasing demand for these technologies in the global market. Furthermore, the country's IT outsourcing companies are focusing on providing customized solutions to their clients, which has helped them gain a competitive edge in the market.

Local special circumstances: Pakistan's IT outsourcing market is also benefiting from the government's efforts to promote the country's IT sector. The government has launched several initiatives to encourage the growth of the IT industry, including tax incentives, subsidies, and funding for IT start-ups. Additionally, the country's geographic location has made it an attractive destination for IT outsourcing companies, as it is situated at the crossroads of South Asia, Central Asia, and the Middle East.

Underlying macroeconomic factors: Pakistan's IT outsourcing market is also benefiting from the country's overall economic growth. The country's GDP has been steadily increasing, and the government has implemented several economic reforms to attract foreign investment. This has resulted in the growth of the country's IT sector, which is expected to continue in the coming years. Moreover, the country's young population, which is tech-savvy and educated, is also contributing to the growth of the IT outsourcing market in Pakistan.

Methodology

Data coverage:

The data encompasses B2G, B2B, and B2C enterprises. Figures are based on enterprises' technology spending on products, consulting, and outsourcing services.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players in the industry, Statista's primary research and surveys, and IT associations. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, internet users, and telecommunication. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing method is used based on the market data characteristics. The main drivers are the GDP and its sector composition, internet penetration, the level of digitization, and the attitude toward IT security.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.