pivotal role in the growth of IT &ITeS sector and this is now getting global acknowledgment and a reputation for reliable and cost-effective delivery of IT and IT enabled services. According to latest forecast by Gartner Inc. in October 2017, Worldwide IT spending is projected to total $3.7 trillion in 2018, an increase of 4.3 percent from 2017 estimated spending of $3.5 trillion. Enterprise software and IT services continue to exhibit strong growth, with communications services continuing to drive the majority of spending. Software spending is projected to grow 8.5 percent in 2017, and it will grow another 9.4 percent in 2018 to total $387 billion. IT services spending is on pace to grow 4 percent in 2017 to reach $931 billion, and increase 5.3 percent in 2018 to reach $980 billion. This report depicts the potential of ITeS sector and it is time to re-align the government strategies to attract a reasonable chunk out of $980 billion. This will help to create thousands of new jobs in IT sector of Pakistan in line with current Government policy to create more and more jobs for youth in digital economy. Current incentives and promotional initiatives already in place for the sector include - 100% foreign ownership Allowed 100% repatriation of capital & dividends (subject to SBP Approval) IT & ITeS Export Income Tax exemption till June 2019 Income tax holiday for Venture Capital companies/funds till June 2024, under Venture Capital Companies and Funds Management Rules, 2000 Additional incentives particularly for IT startups were awarded in the budget (FY 2017-18) to promote innovation & entrepreneurship that included: - - Exemption for a period of three years from Income Tax, Minimum Tax and Withholding Tax for PSEB registered and certified IT startups that are offering technology driven products and services Exemption from sales tax on export of IT services from Islamabad and other federal territories IT Companies allowed to open Foreign Exchange Accounts in Pakistan However, in order to achieve the policy objectives, Ministry of IT & Telecom plans to further incentivize the IT sector through a number of attractive fiscal & non-fiscal incentives to create a favorable business environment. Fiscal Incentives Proposals for fiscal incentives for IT industry are recommended in-consultation with IT industry including PASHA to boost the IT/ITeS Exports. Ministry of IT & Telecom will recommend the proposals for inclusion in the relevant documents such as Finance Bill and BOI’s Special Economic Zone (SEZ) Act etc. after due process. Digital Pakistan Policy Page 18