Global Importance of Midwives

The global Maternal Mortality Rate (MMR) fell from 391 to 197 per 100,000 live births (1990–2023), while the Neonatal Mortality Rate (NMR) dropped from 36.7 to 17.3 per 1,000. Studies show that midwives can prevent over 80% of maternal and neonatal deaths, with every $1 invested returning $16 in economic and social gains. Despite this, the world faces a shortage of about 980,000 midwives.

Key Global Statistics on Midwives as per 2025

Source: Midwives’ Data Hub (2025)

Midwifery in Pakistan

Pakistan has one of the highest NMRs globally (37.6) and an Infant Mortality Rate (IMR) of 50.1. Midwife density remains critically low at 0.7 per 10,000 population (2.2 when including CMWs, LHVs, and midwifery-trained nurses). Heavy reliance on legacy cadres, weak regulation, delayed International Confederation of Midwives (ICM) alignment, and limited clinical authority constrain the profession. Provincial disparities persist—Punjab shows MMR progress but remains a major contributor to NMR, while Balochistan faces stagnation. A rapidly widening shortage (3,100 in 2021 to 81,900 in 2024) reflects chronic underinvestment and weak workforce planning.

2023 Global Health Standings in Maternal and Child Health & Pakistan’s Position

Pakistan ranks among the highest-burden countries: 50th for MMR (155), 2nd for NMR (37.6), and 14th for IMR (50.1). These rankings highlight the urgent need to expand access to skilled midwifery care.

Major Findings

• High Prevalence of Missed Antenatal Care (ANC) Visits
  Many women miss ANC due to financial and decision-making barriers, reinforcing the need for accessible, community-based midwifery care.
• A Doctor-Centric and Costly System
  Dependence on physicians limits rural reach and undermines primary midwife-led models.
• Medicalization and Status-Driven Choices
  Urban families prefer doctor-led births for social status, reducing trust in midwives even for normal pregnancies.
• Rising C-Sections & Lower Physiological Birth Rates
  High elective C-section rates reflect systemic medicalization and weakened demand for safe midwife-led birth.
• Historical Nurse-Midwife Model Inefficiencies
  Dual training have produced nursing professionals who seldom practice midwifery, leading to skill dilution and resource wastage.
• Cadre Overlap & Community Confusion
  Blurred roles between CMWs, LHVs, and FWWs reduce clarity and weaken service delivery.
• Educational Misalignment with Global Standards
  Outdated curricula, weak assessments, and limited faculty reduce clinical competence and global mobility.
• Career Stagnation & Low Motivation
  Poor career progression, corruption in licensing , and inadequate pay tend to push midwives out of the profession.
• Marginalization and Mislabelling
  Midwives face disrespect and are often equated with dais, undermining professional identity.
• Weak Regulation & Lack of Representation
  PNMC reforms remain incomplete; midwives lack leadership presence and regulatory autonomy.
• Suspended Prescription Rights
  Without authority to administer essential drugs, midwives’ ability to manage emergencies is compromised.
• Legal Grey Areas in Clinical Practice
  Midwives frequently perform emergency tasks without legal protection or resources.
• Severe Shortages & Burnout
  High workloads and insufficient staffing compromise care quality.
• Governance and Leadership Gaps
  Nursing-dominated systems exclude midwives from decision-making and institutional leadership.
• Sanctioned Post & Title Disparities
  Midwifery posts remain disproportionately low within health facilities.
• Leadership Instability
  Lack of succession planning results in recurring leadership gaps.
• Abolished Community Midwives (CMW) Stipends
  Withdrawal of stipends has left thousands of CMWs without employment or community practice support.
• Balochistan Midwifery Crisis
  Licensing gaps, absence of posts, and weak deployment systems prevent effective service delivery.
• Donor Dependency & Exclusion from Policy
  Donor-funded programs overshadow structural government reforms, often sidelining midwives.
• Weak MAP Institutional Capacity
  MAP lacks permanent staff and stable funding to act as a national professional body.
• Fragmented NGO Efforts
  Uncoordinated NGO projects create duplication and unsustainable initiatives.
• Male Engagement & Three Delays
  Men’s influence on household decisions affects ANC attendance and emergency referrals.

Recommendations

Educational & Faculty Advancement

• Standardize 2-year associate and 4-year BSM programs to replace fragmented cadres.
• Launch master’s programs to build faculty and leadership capacity.
• Ensure training institutions partner with high-volume maternity facilities.
• Modernize curricula, textbooks, and assessments to reflect global competency standards.
• Recruit and strengthen specialist midwifery faculty through structured development programs.

Governance & Leadership Reform

• Create independent midwifery directorates for equal authority and budgeting.
• Implement structured mentorship and succession planning.
• Integrate donor efforts into government systems and strengthen midwifery data registries.
• Provide stable funding to MAP to function as a national voice for midwives.
• Improve donor accountability and alignment with midwifery priorities.

Regulatory & Legal Empowerment

• Immediately restore prescription rights by finalizing SOPs.
• Provide legal protection for midwives performing recognized BEmONC functions.
• Introduce emergency licensing measures for Balochistan.
• Ensure dedicated midwife seats in PNMC leadership.

Operational Sustainability & Professional Growth

• Convert donor-funded skills labs into permanent government facilities.
• Create clear, transparent career pathways and ensure appropriate deployment.
• Conduct national campaigns to differentiate midwives from dais and build public trust.
• Offer financial and safety incentives for midwives in remote regions.
• Strengthen monitoring systems to ensure adherence to training and quality standards.
• Expand male engagement programs to reduce the Three Delays.

The PBC is a private sector not-for-profit advocacy platform set-up in 2005 by 14 (now 100+) of Pakistan’s largest businesses. PBC’s research-based advocacy supports measures which improve Pakistani industry’s regional and global competitiveness. More information about the PBC, its members, objectives and activities can be found on its website: www.pbc.org.pk

Global Trends of Nurses Migration:

The global nursing workforce was estimated at 29.8 million in 2023, with a projected shortfall of 4.1 million nurses by 2030. The shortage is expected to be especially acute in Africa, South-East Asia, and the Eastern Mediterranean. Foreign nurses comprise the highest proportion of nurses in Gulf countries like Qatar (99.2%) and the UAE (98.8%), followed by Luxembourg (76.9%), Switzerland (27%), Germany (16.9%), Australia (41.9%), and the USA (16.7%). In terms of destinations for nurses to emigrate to, western countries offer nurses stable paths to permanent residency and social benefits despite higher taxes, while gulf countries provide tax-free salaries but temporary residency along with cultural restrictions.

Migration Trends of Pakistani Nurses:

Pakistani workers registered abroad are a significant segment of the Pakistani workforce. They contribute to the national economy through remittances and bring valuable skills and experience back to the country (ILO, 2020). A notable trend in Pakistani overseas employment is the prevalence of unskilled labour. In 2024, 50.1% of all Pakistani workers registered abroad were labourers, highlighting a significant lack of specialized skills.

Looking at the migration of highly qualified workers from Pakistan in 2024, managers led the way, followed by engineers and accountants. Nurses were ranked 5^th amongst the highly qualified workers migrating abroad from Pakistan.

Table: Percentage and CAGR (2014-2024) of Highly Qualified Workers Registered Abroad from Pakistan

Source: Data and Author’s Calculations from BE&OE (2025)

Managers accounted for 49.0% (24.8 thousand) of the highly qualified professionals registered abroad from Pakistan in 2024. In 2024, Engineers and Accountants accounted for 15.9% and 11.3%, respectively. Nurses were about 5.8% of the highly qualified workers registered abroad from Pakistan but in terms of CAGR, Nurses had the highest growth (31.4%) in registration abroad in 2024.

Major Findings:

State of Nursing in Pakistan

Pakistan’s healthcare system is doctor-centric, with a severe shortage of nurses (only 0.4% nurse-to-doctor ratio and 5.2 nurses per 10,000 people), far below international standards. The country produces a critically low number of nursing graduates (5,600 annually), which limits its ability to meet both domestic demand and international opportunities. This shortage is exacerbated by nurses leaving Pakistani hospitals due to low salaries, poor benefits, and heavy workloads, forcing hospitals to use less qualified staff.

Despite these challenges, the stigma associated with nursing is gradually decreasing due to rising global demand and better salaries, attracting more men to the profession. However, nurses are largely excluded from key decision-making roles within healthcare, and Pakistani media often portrays a negative image of the profession, deterring new entrants and harming the international reputation of Pakistani nurses.

Nursing Education in Pakistan

Significant efforts have been made to improve nursing education, including phasing out diplomas for a 4-year BSN degree and stricter affiliation criteria for private institutions. However, challenges persist. There’s a theory-practice gap, especially with graduates from substandard “mushroom institutes” that often lack proper facilities and internships, leading to a decline in practical skills and a risk of fake degrees. The Pakistan Education Endowment Fund (PEEF) offers scholarships but has inconsistent policies that hinder international mobility.

Additionally, a clinical-academia divide prevents nurses from holding both clinical and teaching roles, leading to a disconnect between education and current clinical practices. There’s also a lack of standardized admissions, assessments, and grading, and inadequate access to modern teaching technologies. Furthermore, monitoring of nursing educational institutions is insufficient, and there are limited specialization options in Pakistani nursing degrees, causing the country to miss out on global demand for specialized nurses.

International Mobility of Pakistani Nurses

There’s a high global demand for Pakistani nurses, particularly females, driven by affordability and supply, with new pathways emerging in Kuwait, Qatar, and Saudi Arabia. However, an imbalance exists between demand and supply, with a surplus of unemployed male graduates due to international preferences for female nurses and past negative incidents.

Pakistani nurses face several hurdles in securing international employment, including delayed document verification procedures by Pakistani nursing boards, expensive accreditations, pre-departure training, and exams, and fierce competition from Filipino and Indian nurses who are more abundant, possess better soft skills, and are more willing to exceed job descriptions. Furthermore, Pakistani missions and government bodies often fail to support and promote Pakistani nurses abroad. Other constraints include the unwillingness of female nurses to relocate without family, challenges with cultural integration and foreign accents, and vulnerability to fraudulent schemes. National curriculum barriers and inconsistent terminology also frequently hinder Pakistani nurses from passing international licensing exams. There is limited data availability on Pakistani nurse migration, which impedes strategic planning.

Recommendations:

For the Improvement of the State of Nursing in Pakistan

• Retain Nurses: Standardize salaries, benefits, offer tax concessions, reduce workload, and establish clear career paths to retain nurses.
• Undertake Research and Planning: Public-private partnerships are needed for manpower gap analyses for effective retention and export strategies.
• Elevate Nursing Leadership: Fill leadership positions based on meritocratic criteria.
• Involve Nurses in Decision Making: Establish a national task force with nursing professionals to advocate for the profession.
• Improve Media Image: Strategically use media to showcase the vital role and benefits of nurses.
• Regulate Allied Workers: Ensure clear role distinctions for patient safety and optimal skill utilization.
• Leverage Overseas Expertise: Incentivize returning Pakistani nurses for leadership roles to utilize their international experience.
• Recognize and Empower Advanced Practice Nurses: Formalize advanced nursing roles and empower them to establish clinics in underserved areas.

For the Improvement of Nursing Education in Pakistan

• Produce Specialized Nurses: Revamp BSN programs with specialized internships and establish advanced nursing roles.
• Subsidize Advanced Medical Equipment: Provide modern simulation technologies to all nursing institutes at subsidized rates.
• Standardize Teaching, Admissions, Assessments, and Training: Standardize across all Pakistani nursing institutes.
• Standardize Practical Application of Soft Skills: Implement consistent and deliberate practical teaching of soft skills in clinical settings.
• Integrate Clinical Practice and Academia: Mandate clinical immersion for nursing faculty and facilitate joint appointments.
• Train Teachers and Support Institutions: Fund “Training of the Trainers” programs for advanced teaching methodologies.
• Facilitate Nurses to Start Nursing Institutions: Encourage new nursing colleges through interest-free loans and streamlined procedures.
• Regulate Nursing Institutions Affiliations: Reduce affiliations per hospital and prioritize colleges in rural areas.
• Strategic Planning for Nursing Faculty: Establish criteria for overseas opportunities, retain qualified faculty, and facilitate international exchanges.
• Provide Scholarships and Loans: Offer scholarships and interest-free loans to boost enrolment.
• Introduce Multiple Annual Intakes: Adopt a multiple-intake model to increase the number of qualified nurses.
• Frequent Monitoring and Regulation: Establish an independent body to oversee quality assurance and faculty qualifications.

For the Improvement of International Mobility of Pakistani Nurses

• Train Nurses for Specific Countries: Revise the curriculum and provide targeted training to align with host country requirements.
• Address Curriculum Terminology and Accreditation: Revise the National Nursing Curriculum to align terminology with international standards and pursue international accreditations.
• Pakistani Missions and Government Bodies Need to Facilitate Nurses: Proactively market and promote Pakistani nurses and provide robust support services.
• Streamline Overseas Nurse Employment: Prioritize direct “Government-to-Government” collaborations to eliminate middlemen.
• Reduce Financial Barriers: Adopt an “employer-paid placement fees” model and reduce financial burdens on nurses.
• Streamline Overseas Nurse Deployment: Integrate police checks, subsidize licensing costs, offer support services, and create a job registration system.

The PBC is a private sector not-for-profit advocacy platform set-up in 2005 by 14 (now 100+) of Pakistan’s largest businesses. PBC’s research-based advocacy supports measures which improve Pakistani industry’s regional and global competitiveness. More information about the PBC, its members, objectives and activities can be found on its website: www.pbc.org.pk

This study presents an understanding of the constraints and opportunities of the tourism industry in Pakistan as well as strategies to foster progress. The results are aggregated from the near, medium, and long-term perspectives so that stakeholders can apply practical recommendations and make meaningful improvements. It is strongly believed that tourism can be a panacea for Pakistan and address its economic, socio and cultural issues.

In the year 2019 alone, tourism accounted for 10.4% of the global GDP, with 334 million jobs​ linked directly and indirectly to the industry, making it one of the most impactful industries globally (WTTC, 2024). Moreover, the multiplier effect of tourism [Direct, Indirect & Induced impacts] means that each dollar spent by a tourist has a ripple effect throughout the economy. The global travel & tourism industry is projected to cross USD 12.3 trillion by 2032 (CMI, 2023).

Tourism plays a vital role in any economy, contributing significantly to its GDP, employment, and overall economic development. Over the last few years, Pakistan has started gaining recognition as an international tourist destination. Many international travel magazines and influencers including Forbes, Conde Nast, and the British Backpacker Society have listed Pakistan in their top travel lists because of its geographical terrain, hospitable people, rich history and culture. In 2022, travel and tourism contributed approximately 5.9% to Pakistan’s GDP.

Tourism, undeniably, has the potential to drive economic growth just like other sectors, but it poses challenges that need to be carefully managed. Problems like overtourism, environmental degradation, and erosion of cultures are major threats to long-term sustainable tourism-led economies. Not only this, but the benefits of tourism need to be distributed amongst the regions and communities equitably to internalize this sector in the economy.

Pakistan does not need to target all the 63 various types of tourism, rather it needs to focus on the low hanging tourism sectors and try to increase its share in those sectors, with particular focus on tourism types like adventure, culture, religious, halal, medical, etc. This report works towards a plan to embark on a structured journey to making Pakistan a global tourism giant.

Findings & Recommendations

The detailed findings and recommendations from the report, summarized below, emphasize the areas which need focus to make Pakistan a global tourism destination.

A Centralized Tourism Authority in Pakistan:

Since the 18^th amendment in 2010, tourism has become a provincial subject without a centralized authority. This is hurting Pakistan’s tourism case as the budget and efforts are divided amongst provinces. A Centralized Tourism Authority needs to be enacted by a constitutional amendment. The authority must be empowered with an appropriate budget and a well-defined time bound KPIs.

Policy Reforms and Bylaws:

There are weak policy frameworks and bylaws which hinder the development of a sustainable and structured tourism industry. There should be laws for visa regime, environment, construction, transport, waste management, tourist flows, tour operators, hotel operation, tourist complaint management amongst others.  

Country Perception:

Pakistan’s global image and perception remain poor, hurting tourism’s cause. To address this, the country must actively promote the positive improvements in security through targeted campaigns. Certifications from global safety organizations, along with endorsements from international influencers, should be leveraged to attract potential tourists. Mobilizing Pakistan’s embassies and consulates globally through exhibitions, seminars, advertising, lobbying and engaging influencers can prove to be a key strategy to promote the image of Pakistan. An initiative named “Brand Pakistan” is imperative, engaging youth positively, and making effective use of extensive social media penetration.

Branding Pakistan:

Pakistan has weak branding unlike other Asian tourism giants like Malaysia, Indonesia, Thailand, Turkey, etc. The country has yet to establish and promote “Brand Pakistan” at a global scale. Pakistan needs a strong branding campaign like “Malaysia Truly Asia”, “Wonderful Indonesia”, “Tourism Thailand”, “Go Türkiye”, etc. “Salam Pakistan” branding campaign was launched a couple of years ago; however, it was not promoted aggressively.

Usage of Digital Media:

Using social media, videos and influencer marketing will aid in the creation of an initial hype surrounding the potential of tourism in Pakistan. Hashtag campaigns, user-generated content, and targeted social media ads can quickly engage international audiences.

A Conducive Environment for Investment in tourism:

Pakistan’s evolving tourism policies are attracting domestic as well as international investors, these can unlock the country’s economic potential. However, there are no specific incentives for tourism sector investments. Enhanced investor confidence can be achieved by offering subsidized loans, government guaranteeing tourism investment [like Small Business Administration in USA], tax breaks, occupancy insurance, legal protection, contract enforceability and community alignment with investors.

Public Infrastructure:

Significant efforts have been made recently to improve tourism infrastructure and connectivity. These include road and mobile networks, electricity, air connectivity, transportation networks, and accommodation. Developing hotels and roads can cater to the growing traveler preferences.

Integrated Data Collection:

One of the major hurdles in growing Pakistan’s tourism sector is the absence of reliable, up-to-date data. Despite efforts by the Pakistan Tourism Development Corporation (PTDC) and the Pakistan Bureau of Statistics (PBS), many regions still lack systematic tourism data collection. Strengthening this system would enable more informed policymaking and investment decisions.

 Develop a Tourism Success Story:

Developing a success story gives boost to any industry. Tourism needs a big success story. A possible option is to develop a new city in the northern areas designed to premium international standards. New Skardu City on the riverbank with international airport access just minutes away, and a few hours distance from the mighty K-2 and Deosai Plains can be a great story.

Expanding Community-Led Initiatives:

There is a need to develop small-scale, community-driven tourism projects in various regions on the lines of Trophy Hunting, Clean Hunza and Home Stay Program. These projects can generate local employment, internalize tourism and offer authentic experiences to tourists while preserving cultural heritage.

Improve Tourism Offerings:

Pakistan has much to offer beyond adventure tourism. Out of the 63 categories of tourism, religious tourism has great potential. Pakistan being home to 3 religions – Buddhism, Sikhism & Hinduism – can attract millions of tourists, it is also ideal for Halal tourism, as a destination for cheap Medical Tourism, it is conducive for Music, Cultural & Food tourism, as a historic destination for Heritage tourism, and it has a rich landscape for Rural tourism, etc. These offerings need to be developed systematically.

Capacity Building and Development:

Training and capacity-building programs for the local communities, guides, and hospitality staff will improve the general services in the country. This will create a more enhanced tourist experience, leading to repeat visits and recommendations.

Public-Private Partnerships (PPPs):

By expanding PPPs for larger tourism development projects, including resort and transport infrastructure, Pakistan can build sustainable tourism assets that attract both domestic and international tourists. PPPs will also ensure that key tourism areas are managed effectively, with investments in environmental conservation.

Collaborations with International Tourism Boards:

Partnerships with global tourism boards, including cross-border campaigns with neighboring countries, will boost Pakistan’s visibility in international markets. These include joint marketing campaigns, collaborative investment forums, and participation in international tourism expos.

Sustainable and Responsible Tourism Leadership:

Pakistan should position itself as a leader in eco-tourism and wildlife conservation through long-term conservation initiatives, by building partnerships with global environmental organizations, and having in place an eco-friendly infrastructure.

Tourism industry in Pakistan cannot be developed overnight. It will take several years of sustained investment to realize its full potential, leading to a significant increase in employment especially in rural areas, and the inflow of foreign exchange, besides improving Pakistan’s soft image.

The PBC is a private sector not-for-profit advocacy platform set-up in 2005 by 14 (now 100+) of Pakistan’s largest businesses. PBC’s research-based advocacy supports measures which improve Pakistani industry’s regional and global competitiveness. More information about the PBC, its members, objectives and activities can be found on its website: www.pbc.org.pk

For Pakistan, logistics is particularly critical. While tariff reductions have limited impact on trade costs, logistics, such as transport infrastructure and customs efficiency, play a far greater role. Sectors like agriculture, mining, and heavy industry, which are highly logistics-intensive, stand to benefit significantly. However, transport effectiveness in Pakistan has been declining, posing a major hurdle to competitiveness.

The logistics sector contributes over 10.5% to Pakistan’s GDP and employs 5.4% of the workforce. However, performance of the sector is declining. High volatility and a sharp reduction in private sector investment indicate structural fragility. Roads dominate the sector, with a 501,169 km network overshadowing the 7,791 km of rail. Yet, Pakistan has only 300,649 registered trucks, vastly fewer than regional peers like India with 12.5 million trucks, highlighting critical infrastructure gaps. Currently, 94% of freight is moved by road, creating supply chain inefficiencies, congestion, and elevated costs.

Warehousing and cold-chain logistics are weak, with over 40% of perishables lost due to inadequate storage. Airports and railway stations lack cold storage, undermining the handling of temperature-sensitive goods. Institutionally, the sector is fragmented and governed by outdated laws, despite progressive policy frameworks like the National Transport Policy and the National Freight & Logistics Policy. Implementation however, remains sluggish.

The road logistics market is fragmented and dominated by small owner-operators, who constitute 85% of providers but hold less than 5% market share. These operators face challenges including outdated vehicles, lack of access to finance, and minimal professional training. Technology adoption is low, and many vehicles lack insurance and do not meet international standards, increasing operational risks. Overloading is a persistent issue, damaging infrastructure and increasing maintenance costs, while inefficient spatial planning increases costs for export industries dependent on imported inputs.

Traffic on Pakistan’s roads is expected to rise 40% over the next decade, worsening congestion and emissions. The road sector already consumes nearly three times as much fuel as rail, straining resources and accelerating environmental degradation.

While CPEC and CAREC have improved segments of the road network, investment in public transportation and industrial growth policy remains limited. The trucking industry lacks fuel-efficient, low-emission vehicles. With increasing emphasis on global green trade standards, such as the EU Green Deal, Pakistan risks export exclusion if emissions are not reduced. The Export Logistics Performance Index benchmark shows Pakistan scoring 2.3/5, representing a 54% underperformance compared to regional peers. The Logistics Performance Index (LPI) also declined from 2.42 in 2018 to 2.3. The main gaps are in sustainable logistics, supply chain efficiency, and cost. Sustainable road logistics show a 138% underperformance, primarily due to old trucks and weak environmental regulations. Outdated customs processes and informal vehicles prevent Pakistan from accessing key markets like China. Informal trucks evade regulations, increasing systemic costs and hampering access to premium trade routes.

Governance is fragmented, with multiple agencies managing roads, ports, and customs, resulting in siloed decision-making and poor coordination. The absence of a dedicated Ministry of Transport and Logistics has hindered past reform efforts like the National Trade Corridor Improvement Program. This results in selective enforcement of axle load rules and incoherent regulatory practices.

The state-run National Logistics Cell (NLC) dominates the sector, moving nearly 60% of the country’s crude oil. Despite its strategic role, NLC’s privileged position discourages private sector participation and innovation, leading to a monopolistic market structure.

Infrastructure deficits further hinder logistics efficiency. Dilapidated roads, inadequate warehousing, and the absence of modern vehicle support systems delay delivery and raise costs. Fleet renewal is constrained by high leasing costs and poor access to credit, locking operators into outdated practices. The segmentation of logistics into formal, informal, and quasi-governmental actors raises costs for compliant operators and fosters inefficiency. Pakistan needs a strategic reset through structural reforms, institutional strengthening, and targeted investments.

The prioritized recommendations include:

Institutional Governance and Financial Enablement

• Industry Status Notification: Officially designate trucking as an industry to unlock access to structured financing and leasing facilities for fleet modernization.
• Dedicated Ministry or Focal Body: Establish a unified authority to oversee multimodal logistics development and strategic coordination.
• Green Financing Access: Create concessional financing options for Euro 5-compliant, fuel-efficient trucks through public and private banking partnerships.
• Inclusive Financial Support: Develop financing schemes that enable small operators and new entrants to access credit, including through partnerships with NLC for training and onboarding.

Infrastructure Development

• National Highway Upgrades: Prioritize completion of key corridors like the Hyderabad–Sukkur Motorway and enhance highway security and maintenance.
• Port and Inland Warehousing: Develop advanced warehousing at ports and along main trade corridors, guided by a national master plan.
• Farm-to-Market Connectivity: Invest in critical missing road links to connect producers to export hubs, with a focus on rural areas.
• Digital Network Connectivity: Expand network coverage on key road corridors via the Universal Service Fund (USF) to support digital logistics systems.

Technology Adoption and Innovation

• Annual Awareness Forums: Introduce private sector stakeholders to global trends in logistics and digital platforms through annual national events.
• E-Governance for Permits: Launch an integrated online freight permit system to improve transparency and efficiency.
• Digital Tolling and Weighing: Establish centralized, tamper-proof weighing systems to reduce corruption and ensure regulatory compliance.

Capacity Building and Human Resource Development

• Driver Training Institutes: Create certified institutions to train drivers on safety, cross-border protocols, and international freight standards.
• Regulatory Workshops: Offer regular training for logistics managers and operators on leveraging government reforms and financial tools.
• Gender Inclusion: Pilot initiatives to train women drivers and set quotas for female participation, building on successful private sector models like Engro.

The PBC is a private sector not-for-profit advocacy platform set-up in 2005 by 14 (now 100+) of Pakistan’s largest businesses. PBC’s research-based advocacy supports measures which improve Pakistani industry’s regional and global competitiveness. More information about the PBC, its members, objectives and activities can be found on its website: www.pbc.org.pk

In addition to secondary data, the study relies heavily on input provided during in-person interactions with senior management of 30 medical facilities located in ‘6’ cities of Pakistan

Purpose and Scope of the Study

This study delves into the promising yet untapped potential of Pakistan as a destination for medical tourism. With global medical tourism estimated at $19.28 billion in 2022 and projected to grow at an impressive CAGR of 21.3% through 2030, there is a pressing need for Pakistan to strategically position itself to capture a share of this growing market. This report not only assesses the opportunities available to Pakistan but also provides actionable insights into overcoming existing challenges and enhancing the sector’s competitiveness.

Why This Report Matters?

The findings underscore the enormous potential for medical tourism to contribute to Pakistan’s economic growth and global integration. By capitalizing on its strengths and addressing critical gaps, Pakistan can establish itself as a competitive medical tourism destination, much like its regional peers. This aligns seamlessly with the PBC’s mission of fostering sustainable growth through innovative and evidence-based advocacy.

Global Context

Medical tourism is fueled by rising healthcare costs in developed nations, the growing demand for specialized treatments, and the desire to combine healthcare with leisure. Countries like India, Türkiye, Thailand, and Malaysia lead the market, offering a roadmap for Pakistan to follow. Emerging trends include wellness tourism and cosmetic procedures.

Pakistan’s Competitive Advantages

1. Low-Cost, High-Quality Care: Pakistan provides affordable healthcare services, such as cardiology, orthopedics, oncology, and cosmetic surgery, often at a fraction of the cost in developed countries.
2. Strategic Location: Proximity to regions like Central Asia, the Middle East, and Africa makes Pakistan an accessible option for international patients.
3. Skilled Workforce & International Accreditations: Highly trained medical professionals and some internationally accredited hospitals.
4. Cultural and Religious Affinity: Shared values with Muslim-majority countries can attract patients from regions like the Middle East, Central Asia and Africa.

Challenges

1. Safety Perceptions: Concerns regarding terrorism and crime.
2. Inconsistent Healthcare Quality: Uneven standards and limited international accreditations.
3. Logistical Issues: Lengthy visa processes, inadequate connectivity, and infrastructure gaps.
4. Weak Branding and Marketing: Lack of a cohesive strategy to promote Pakistan’s medical tourism potential.
5. Regulatory Gaps: Insufficient oversight on healthcare quality and patient rights.

Strategic Recommendations

1. Policy and Governance:
   • Launch media campaigns to improve Pakistan’s global image.
   • Simplify visa processes, including medical e-visas.
   • Implement stronger healthcare regulations and ensure international accreditations.
2. Infrastructure Development:
   • Invest in modernizing healthcare facilities and equipment.
   • Improve connectivity with direct flights to target markets.
   • Establish follow-up care centers in key regions.
3. Marketing and Branding:
   • Develop a unified medical tourism brand for Pakistan.
   • Collaborate with embassies and private sector organizations to promote services.
   • Leverage the Pakistani diaspora as ambassadors for medical tourism.
4. Public-Private Partnerships:
   • Foster collaboration between government and private healthcare providers.
   • Encourage investments in specialized healthcare services like cosmetic surgery, transplants, and fertility treatments.

Target Markets

• Afghanistan and Iran: Proximity and cultural ties.
• Africa and Central Asia: Affordable care and religious affinity.
• Pakistani Diaspora: Patients seeking cost-effective treatment combined with family visits.

Conclusion

Pakistan possesses significant potential to emerge as a competitive destination for medical tourism. By addressing challenges and capitalizing on its strengths, the country can attract international patients, boost economic growth, and establish itself as a regional healthcare leader.

This report provides actionable insights for policymakers and industry stakeholders to drive strategic reforms and investments that will position Pakistan as a global player in medical tourism.

Call to Action

We invite policymakers, industry stakeholders, and healthcare professionals to engage with the insights and recommendations presented in this report.

Your feedback and collaboration will be instrumental in shaping a roadmap for transforming Pakistan into a thriving hub for medical tourism.

The PBC is a private sector not-for-profit advocacy platform set-up in 2005 by 14 (now 100+) of Pakistan’s largest businesses. PBC’s research-based advocacy supports measures which improve Pakistani industry’s regional and global competitiveness. More information about the PBC, its members, objectives and activities can be found on its website: www.pbc.org.pk

Pakistan’s Religious Travel & Tourism Services:

The global market for faith-based tourism was estimated at around $13.7 billion in 2022.  Pakistan is home to several religious sites and worship places of the most prominent religions; its religious tourism sites are similar to India’s which is estimated to have a 6 – 10% share in the global market for faith-based tourism.

Pakistan’s exports in religious travel services amounted to $0.9 million in 2022, which makes about 0.1% of the total Travel Services Exports.

Major Findings:

Improvements in the Upkeep of Religious Sites & Visa Facilitation for Pilgrims: In the past decade, there have been some improvements in terms of renovations of religious sites, visa policy and in the number of pilgrims / tourists arriving in Pakistan

Major Markets for Religious Tourism in Pakistan: Currently, Pakistan’s major market for religious tourism is the South Asian diaspora. India is a major potential market for religious tourism to Pakistan for Sufi, Sikh, Hindu, Buddhist, Jain and Zoroastrian pilgrims.

Current Marketing Strategies for Promoting Religious Tourism Includes social media campaigns, online market places, B2B (Business to Business) partnerships, etc. Government support is lacking for participation in International Exhibitions, promotions through social media platforms, and in the organization of FAM trips.

Visa Procedure is Long and Complicated: Despite a noticeable easing in the visa process, it still remains long and complicated especially for religious tourism.

Non-Availability of Data on Religious Tourists for Forecasting & Managing Demand: Disaggregation of the statistics on Religious Travel is needed to forecast demand to accommodate religious tourists better.

Climate Change is Affecting Pakistan’s Tourism Adversely leading to inconvenience, especially when travelling to areas like Gilgit Baltistan.

Poor Country Image: Pakistan has a reputation of being unsafe as the country is viewed as being associated with violence and terrorism.

Government Entities are Interfering rather than Facilitating: Enforcement of unnecessary restrictions, harassment of pilgrims through frequent phone calls, Bureaucratic hurdles, outdated rules, and the lack of cooperation from government entities is interfering rather than facilitating religious tourism.

Too Many Restrictions While Travelling within Pakistan on a Religious Visa: Security escorts, frequent security check delays, and compulsory police registration for citizens of Indian origin are unnecessary,  create inconveniences which restrict freedom to explore areas adjoining these religious sites.

Lack of Coherence and Consistency in Government Policies and Initiatives: Each province/ region has different plans, vision and strategies for the enhancement of tourism leading to a lack of coherence in polices at a national level.

Religious Tolerance Varies Across the Country:  Higher levels of religious tolerance for the rituals of minority religions are present in Sindh, KPK as compared to Punjab. In Gilgit Baltistan, promotion of Buddhist religious tourism is becoming difficult due to resistance from locals.

Lack of Awareness and Sensitivity in the Local Population: Many of locals are unaware that the influx of religious tourists will bring in foreign exchange and lead to the development of their areas. There is general insensitivity towards the cultural and religious sentiments of the religious minorities.

Too Much Focus on a Few Religious Sites: The focus is mainly on promoting Sikh religious tourism. Hindu, Sufi, Christian, Jain and other forms of tourism are not given much consideration.

Shortage of Trained Tour and Hospitality Staff: There is a lack of trained and professional tour guides and hospitality staff.

Lack of Facilities, Hotels and other Infrastructure around the Sites: Most of the facilities, lodges, and hotels located near the sites do not cater to foreign tourists that would be willing to pay a higher price. Furthermore, the facilities and infrastructure around the sites are not adequate to accommodate the huge influx of pilgrims/tourists during festivities.

Religious Tourism in Pakistan is Mostly Seasonal in Nature: Most influx of tourists occurs during religious festivals of the respective religions. Because of this, it is not financially viable to invest in infrastructure that is not in use throughout the year.

Lack of Proper Research and Planning on Site Restoration: Restorations of sites are not respectful of the religious sentiments, sensitivities of climate and structural requirements. This is at times viewed as desecration of their religious sites by the pilgrims and creates resentment.

Lack of Private-Public Partnerships: Government support is lacking in international marketing, renovations, fund raising and other vital activities. Government bodies and advisory boards lack representation from experienced private tour operators of the country.

Recommendations:

Document and Publish Data on Religious Tourism: Data relating to religious tourism needs to be collected in order to document arrivals (monthly, quarterly and annual), the number of visits to the sites, usage of facilities, spending and other relevant data.

Government Needs to Act as a Facilitator: The government needs to hand the management of religious sites to the sites’ respective communities. There should be an online complaint system specifically for tourism where unjustifiable practices can be reported. Similarly, agencies need to stop the harassment of pilgrims. Insurance cover can be offered to the tourists in case of flight cancellations. The government should fully sponsor, offer guidance and support tour operators during international travel exhibitions.

Devise and Implement Effective Marketing Strategies: The government & industry need to invest in documentaries, movies, and readable material for the promotion of religious tourism. FAM trips should be organized to engage foreign tour operators. Pakistan’s softer image should be broadcast abroad through marketing campaigns on Mainstream International Channels and Print Media.

Create and Market Events throughout the Year: Given the current seasonal nature of religious tourism, events and marketing of religious tourism should take place throughout the year in order to encourage investments in infrastructure, facilities, and renovations of the religious sites.

Improve Performance of Pakistani Embassies: Pakistani Embassies abroad need to be more welcoming and accommodating. Pakistan’s embassies need to work together with the tourism department to promote religious tourism especially during the dates of the festivities of Sikh, Hindu and other religions.

Encourage Public Private Partnerships: The government needs to involve the private sector in its advisory boards, committees, renovations, creation of reading materials, fund raising and, in the construction, and management of hotels, guest houses, roads, and hospitals.

Visa Policy and Procedure Needs to be further simplified: The visa form should be simple and short to fill. The requirement of unnecessary documents should be reduced. There needs to a 24/7 helpline available for visa procedure assistance. Restrictions on travel of Indian citizens to Pakistan should be reduced through diplomatic negotiations and revision in visa rules. Visa on Arrival protocols should not be long and tedious.

Improve Security and Allow Tourists Freedom to Explore: There need to be reforms to improve the general security and the working of security institutions in Pakistan. NOCs for travel to Baluchistan and Azad Kashmir in certain cases should be relaxed.  Frequent security checks of tourists on the Karakoram Highway should be discouraged.

Significant Improvements in Infrastructure, Facilities and Medical Services: Sites that are in the limelight like Gurdwara Jaman Asthan (Nankana Sahib) and Gurdwara Darbar Sahib Jee (Kartarpur) have provision of roads & connectivity, but lack good quality facilities such as washrooms, restaurants, etc. as well as onsite accommodation.

Prepare Sites for Festivities: There is a need to build an infrastructure with a vision of accommodating a large influx of tourists especially during major festivities such as Vaishaki. There should be welcoming signs placed near Air Ports and religious sites, specifically designed for occasions and festivities.

Encourage Other Religious Tourism: International marketing of Chirstian, Jain, and Sufi religious tourism needs to be done where the festivals such as Sufi Urs and the Melas are promoted.

Activate Some of the In-active Religious Sites: Activating some of the inactive sites will not only facilitate religious tourism but also project a softer side of Pakistan to the world.

Restore Sites with Proper Planning and Research: There should be a separate department responsible for the restoration of religious sites which has a separate research department. Restoration of the sites should be done with consideration of the climate, religious sentiments, and cultural implications.

Create Awareness in the Local Population About Benefits of Religious Tourism: Education and awareness campaigns in the local communities should be initiated for promoting the economic benefits arising from religious tourism. The importance of religious tolerance of minority religions, and consideration of other religions’ relics and worship places needs to be promoted.

On Arrival Facilitation: Religious tourists and pilgrims should be facilitated and welcomed especially on arrival. Special teams should be designated to receive religious tourists at the airport that provide facilitation and information as needed.

Transit Visas for Sikh Pilgrims: The possibility of granting online Transit Visas for Sikh pilgrims flying to and from India for visiting Sikh sites, initially in and around Lahore can be considered.

Dedicated Air Corridor for Indian Pilgrims Visiting Pakistan for Religious Tourism: Initially a dedicated air corridor can be developed between the major cities of Northern & Western India and Lahore and Islamabad.

The PBC is a private sector not-for-profit advocacy platform set-up in 2005 by 14 (now 100+) of Pakistan’s largest businesses. PBC’s research-based advocacy supports measures which improve Pakistani industry’s regional and global competitiveness. More information about the PBC, its members, objectives and activities can be found on its website: www.pbc.org.pk

The Report aims to answer the following questions:

• What is E-Commerce?
• What is cross-border E-Commerce?
• What is meant by the term Fashion Products?
• Which companies from Pakistan are major players in E-Commerce?
• Which are Pakistan’s major markets for cross-border E-Commerce?
• What are the major findings of this Study?
• Which are the major recommendations for promoting exports using E-Commerce?

What is E-Commerce?

E-commerce (Electronic Commerce) is defined as the activity of electronically buying or selling of products using online services or the internet.  Among the various categories of E-commerce, B2C E-commerce receives the most attention due to its simplicity and familiarity.

In 2022, global E-commerce sales were estimated at about $5.5 trillion, accounting for about 19.7% of total global retail sales.

What is cross-border E-Commerce?

Cross Border Trade occurs when products are sold to customers beyond the geographical boundaries of a country. It can be B2C (Business 2 Consumer) or B2B (Business 2 Business), this report will focus on B2C. Cross border trade benefits both sellers and brands in providing access to new markets, increased sales, higher revenues, all year demand, brand visibility and finally to help gain a competitive advantage over rivals in international markets.

In 2021, the global cross-border E-commerce trade was estimated to be about $784.6 billion and was expected to grow at a CAGR of 26.2% between 2022 & 2031  reaching $7.9 trillion by 2031.

What is meant by the term Fashion Products?

Fashion Products have three major categories; these are Apparel, Footwear, and Accessories. Accessories include women, men and children clothing accessories, bags, eye wear, watches, jewelry, etc.

Globally, most revenue in retail E-commerce has been generated through Fashion sales, wherein Apparel constituted 57.3% of the revenue, followed by Accessories (29.3%) and Footwear (13.5%) in 2022.

Which companies from Pakistan are major players in E-Commerce?

In Pakistan, the top 5 websites in terms of Domestic Net Sales were all websites selling Fashion Products in 2021. The top three websites; limelight.com, gulahmedshop.com and khadi.com hold 2% of the online revenue in Pakistan (ecommerceDB, 2022).

Top E-commerce Websites in Pakistan in Terms of Domestic Net Sales in 2021

Which are Pakistan’s major markets for cross-border E-Commerce?

Main markets for Pakistani Fashion using the E-commerce platform are the U.S.A., the U.K., the U.A.E., Canada, Australia, Europe and Gulf countries. Even though Saudi Arabia and the U.A.E have the highest number of Overseas Pakistanis, the sales of Fashion products are mainly dependent on the purchasing power of the diaspora, the currency conversion rate, and the customs regulations of that country.

What are the major findings of this Study?

• Covid-19 has boosted domestic E-commerce fashion sales
• Pakistani eastern wear is well-established amongst the Pakistani diaspora
• Pakistani fashion products are catering narrowly to the Pakistani diaspora
• The demand for eastern wear among the diaspora is cyclical
• International marketing strategies are dependent on international platforms, such as Facebook, Google, etc.
• Logistics are inefficient & expensive.
• There is a shortage of tech talent for local E-commerce merchants
• Government processes are mostly manual
• There is a disconnect between merchants, government and the financial sector
• Pakistani fashion manufacturers lack the expertise needed to cater to a wider international customer base.
• Pakistan’s poor international reputation & the lack of a complaint redressal mechanism impacts demand
• Smooth product return mechanism for international orders is not available
• The requirement of 3-D verification for credit card payments reduces online sales
• Multiple websites using same or similar sounding names as those of leading brands cause suspicion in the minds of buyers
• Prices displayed on websites are exclusive of customs duties and vat
• Target market is primarily female
• There is a lack of standardized dress sizes
• Short window to realize export proceeds impacts ability to stock to sell in major markets

Which are the major recommendations for promoting exports using E-Commerce?

• Training and awareness sessions for fashion designers and merchants
• Facilitate international logistics in Pakistan
• Creation of third-party service providers in Pakistan to handle specific E-commerce tasks
• Banking, and customs procedures need to be digitalized
• Revision of SBP and customs laws in consultation with merchants
• Promotion of Pakistani fashion through collaborations with international designers
• Issuance of certification or badges to genuine websites of fashion brands
• Improvements in Pakistani payment gateways
• Facilitating digital marketing services providers in Pakistan
• Development of ancillary products, fusion wear and western wear brands
• Industry needs to implement standardization
• Focus towards a more diversified client base

The PBC is a private sector not-for-profit advocacy platform set-up in 2005 by 14 (now 98) of Pakistan’s largest businesses. PBC’s research-based advocacy supports measures which improve Pakistani industry’s regional and global competitiveness. More information about PBC, its members, objectives and activities can be found on its website: www.pbc.org.pk

Global Computer Services Trade:

Globally, Classification 9, Telecommunications, computer and information services have witnessed the highest CAGR of 9.9% during 2016-2020. This classification represented 14.3% of the total services exports in 2020. Classification 9.2, Computer services contributed about 78.9% under Classification 9, Telecommunications, computer, and information services exports between 2016 & 2020.

Pakistan’s Computer Services Trade:

Value of Exports:

• Exports amounted to $1,666.3 million in FY 21.
• Exports were about 78.6% and imports 82.6% of the total trade under Classification 9, Telecommunications, computer and information services in FY21.

Growth in Exports:

• Pakistan ranked 7^th amongst the countries that witnessed the highest growth of 36.0% in Classification 9.2, Computer services exports between 2019 & 2020.
• Exports grew by 50.3% between FY20 & FY21.

World Rank:

• World: 31^st in Exports and 40^th in Imports amongst reporting economies in 2020.
• Developing Countries: Pakistan’s Classification 9.2, Computer services exports rank 14^th amongst the reporting developing countries.
• South Asia: Pakistan’s Classification 9.2, exports rank 2^nd in South Asia, India being the 1^st.

Pakistan’s Computer Services Competitiveness Indicators

Pakistan has a low market share of 0.2% even though all the indexes show that Pakistan has a Revealed Comparative Advantage in Classification 9.2, Computer Services, not only in the world but also amongst developing countries as can be seen by the comparative indexes Relative Export Advantage (RXA), Relative Trade Advantage (RTA) and Revealed Competitiveness (RC) being positive.

Major Challenges Faced by Pakistan’s IT Services Sector:

Shortage of talent. There is currently a shortage of human resources, primarily due to a surge in demand and a general shortage of talent.

The domestic market is extremely challenging. Due to the several challenges in the domestic market, such as unfair competition with government entities, taxes, etc. many private sector firms find it difficult to obtain local business and thus, are not able to make a portfolio that is attractive to foreign customers.

There are limited large organizations in the Pakistani IT services industry. Smaller companies lack processes, skills and capability to handle big projects. There are lack of mergers in Pakistan, mostly due to the general mindset.

Technology parks in Pakistan do not have the facilities that are required. These parks lack facilities like subsidized electricity, space, other inputs, etc. like those available in countries like India, China, U.A.E. and Philippines.

Industry-Academia gap.  Curriculum is mostly outdated and has not been updated as per the requirements of the dynamic IT services industry. There is a human resource shortage in higher paying services like Block Chain, IoT, Data Science, etc. There are limited institutions in Pakistan catering to developing these skills.

Lack of exportable quality original software in Pakistan. Most of the companies in Pakistan that are providing software services are usually working on original software of a foreign company. The companies/ individuals that have made original software cannot just directly export it without creating a domestic base first, which is difficult in the present composition of the domestic market.

Lack of ethics among the young workforce. Most of the employers in the IT services industry have faced fresh graduates not showing up for an interview without informing beforehand.  It is mostly observed that young professionals do not serve the notice period required before switching jobs.

Courts in Pakistan are not equipped to handle IT related cases. In Pakistan, there are no specific courts/ judges designated to handle Cyber Crime. Cyber Crime Laws are present but the legal system is not equipped to handle related cases.

Pakistan’s Image is fragile. Political uncertainty, economic instability, and other crises in Pakistan when highlighted can damage the country’s image. Most of the International companies, when looking for service providers or for the location of back offices rely on news and country image.

Inconsistency of policies. There are sudden changes in policies as the political regime in Pakistan changes, e.g., the change in tax regime from exemption to credit, imposition of sales tax on imported laptops and computers, etc. This restricts businesses abilities to plan ahead.

Policies that discourage growth of IT companies. Tax Credit scheme led to harassment by the FBR and a rise in the compliance cost for most companies. Registering freelancers, on paper is a good step, but to avoid constant harassment by the FBR, many may have not registered.

Brain Drain. Due to unstable, inconsistent policies, and other issues, many Pakistan firms have set up offices in the U.A.E. and other locations outside of Pakistan. Due to high international demand, talent in the IT services sector has located abroad as well.

Rise in Costs. Due to the depreciating Pakistani currency, rise in taxation, and shortage of human resources. Continuous rise in costs will lead to a decrease in the IT services companies’ profit margins.

Disruptions in internet connectivity. These mostly occur during protests, heavy rains, religious processions lead to many IT services firms losing their reputation or business because for call centers, there is a need for continuous operations.

Difficulty obtaining financing. The Banking system is gradually recognizing the IT services industry; however, many banking institutions are focused on the goods sector rather than the services sector.

Pakistan’s laws have not been revised for the knowledge economy. Pakistan’s laws are focused on the agricultural/manufacturing sector. Labor laws such as compulsory EOBI, working hours of 9 to 5, need not apply to the knowledge economy, where health insurance is provided and working hours should be flexible.

Relocation & movement of HR from Pakistan to destination markets. Pakistan’s FTA don’t cover services and hence movement of persons. Easy movement of people is necessary to obtain projects/ business. Pakistan doesn’t have a strong lobbying in its major markets like the U.S.A. in order to boost its business.

Lack of Accurate statistics on the IT services industry. This hinders in policy making and long-term planning for the industry.

Difficulty in expanding business abroad. Due to restrictions by the SBP such as on investments abroad, limits the ability of Pakistani companies to expand in regional and global markets.

Major Recommendations:

Improve factor related Issues

• Bridge the Industry-Academia gap.
• The Banking Sector needs to be educated regarding lending to the IT services industry.
• Government Backed Venture Capital Funds are required.
• Local manufacture of hardware, computer, laptops and accessories need to be encouraged.
• Encourage more women into the workforce.
• Provide Subsidized Electricity, similar to what is provided to the export sectors.

Policy/ Legislation related Recommendations

• Laws need to be devised for the IT services industry.
• Specialized courts should be designated for handling cases related to the IT services Industry.
• More inclusive representation in federal institutions and consultative forums.
• Consistency of policies and their proper implementation.
• Policies targeted at attracting talent from abroad.
• Rationalization of the tax regime for the sector.

Recommendations for the Structure of the IT industry

• Encourage the formation of large companies.
• Accurate statistics on the IT services industry for policy making.

Encourage Domestic Demand

The Government needs to act as a catalyst rather than a competitor in the Domestic IT services market.

Enhance Trade

• Set up a Special Economic Zone (SEZ).
• FTAs should be signed to facilitate freedom of movement.
• Need to focus on exporting High-end services.
• Improve Pakistan’s Image and PR abroad.

The PBC is a private sector not-for-profit advocacy platform set-up in 2005 by 14 (now 96) of Pakistan’s largest businesses. PBC’s research-based advocacy supports measures which improve Pakistani industry’s regional and global competitiveness. More information about PBC, its members, objectives and activities can be found on its website: www.pbc.org.pk

The Other Business Services Sector

As demand for professionals is increasing, the other business services sector has expanded at a healthy rate. The sector had the highest global exports in services exports ($1,292.8 billion in 2020), along with the fourth-highest growth rate. The sector comprises of three sub-sectors: Classification 10.1 “Research and Development (R&D)”, Classification 10.2 “Professional and Management Consulting”, and Classification 10.3 “Technical, Trade-related, and other Business Services”. In 2020, the USA and the UK dominated the world’s export markets for these services, with market shares of 14.2% and 9.9%, respectively. On the import side, Ireland and the USA lead in global imports of other business services, with market shares of 11.4% and 9.0%, respectively.

In Pakistan’s case, the export value of other business services amounted to $1.4 billion while imports were worth $2.4 billion in FY21, making this the second-largest export and import services sector for Pakistan.

The Global Accounting Services Sector

Accounting services include accounting and bookkeeping (measuring and recording the financial flows and positions of an enterprise), auditing (verifying and attesting/certifying the accuracy of the financial position and results of the enterprise, for internal or external purposes), and tax preparation, amongst other services. The Big Four – Deloitte, PwC, Ernst & Young, and KPMG – dominate the accounting arena globally, with revenues of $50.0 billion, $45.1 billion, $40.0 billion, and $32.1 billion in 2021, respectively.

The accounting process is becoming more and more automated. New dimensions have been developed in the area of fin-tech, algorithms, analytics and assurance. Emerging trends in the industry include cloud-based accounting, blockchain technology, artificial intelligence, advisory services, and so on.

Pakistan’s Accounting Services Sector

Pakistan’s exports under this classification increased sharply between FY15 & FY18, before declining slightly till FY20, it then reached an all-time high of $41.4 million in FY21. Meanwhile, imports of such services have remained low throughout, amounting to around $0.7 million in FY21.

There are a number of professional accountancy organizations in Pakistan such as ICAP, ICMAP, PIPFA, ACCA, and CIMA. More details on these organizations can be seen in Chapter 5. ICAP has been assigned the responsibility of developing and adopting accounting standards in Pakistan by the SECP.

Main Findings

Digitalization in the accounting arena: Pakistan’s progress in this area has been relatively slow and the country needs to keep the emerging trends in mind and to invest in new technologies to become globally competitive. Cloud-based accounting, software, blockchain technology, communication technology, and artificial intelligence are areas where Pakistan needs to catch up. Moreover, the lack of a virtual portal or platform for the services and accounting sector poses a challenge for Pakistan. Foreign markets are unaware of qualified professionals in Pakistan and the services that they can provide which limits the export of such services.

Continual professional development: The technical knowledge of a fresh accounting professional in Pakistan is excellent and in line with international demand. However, these fresh talents mostly struggle in areas of critical thinking, negotiation skills, presentation skills, and communication skills.

Lack of marketing of services: Pakistan needs to work on its branding and marketing as a country to create awareness and to market the availability of the talent present in the country. One restriction in this area is that Chartered Accountants are not allowed to market themselves.

Costly compliance requirements: Working on licensed products such as Microsoft office, cloud servers (Amazon, Oracle), putting firewalls, and anti-viruses in place are some compliance requirements that foreign buyers expect adherence to. While large firms do not face any issue in these areas, medium & small-scale firms might find adhering to such requirements costly.

Lack of credit insurance and payment gateways: This translates into reluctance on the part of service providers to export their services. There is also a general lack of trust in digital transactions.

Unsupportive infrastructure: Stable, uninterrupted, high-speed and affordable internet connections and power supplies, along with a proper workspace set up with computers or laptops are a few of the most vital things needed to provide services abroad.

Main Recommendations

Pakistan needs to create awareness of the latest global trends: The Pakistani services providers need to be made aware of emerging trends, this will be the first step towards digitization. More webinars and seminars will help increase awareness.

Inculcate and integrate emerging accounting trends:  Emerging accounting trends such as Robotics Accounting in educational examinations, as well as, in professional trainings need to be integrated in the curriculum. There is also a need for a network of education providers to help talent progress alongside technical exams, and a network of employers who not only train this talent, but also provide continuous professional development.

Career counselling sessions in schools: To increase awareness regarding the profession and future opportunities that might become available, local professional accounting bodies need to interact frequently amongst themselves to devise strategies for promoting the profession of accountancy in Pakistan. New ideas and making use of appropriate technology needs to be discussed and implemented in the country.

Financial support to small and medium-sized accounting firms: Since accounting and auditing software is expensive, some type of handholding is required for the firms in the SME sector.

Digital promotion platforms need to be used: To market and promote Pakistan as the preferred destination for such accounting services, email marketing can be used to target potential clients. Foreign Trade Officers based in current and potential markets should make a joint effort to increase awareness about Pakistan’s high quality accounting services. Pakistan can arrange conferences, outsourcing expos, exhibitions, and meet ups with international clients to create awareness. Services knowledge platforms need to be established in the country to fill gaps in knowledge.

Technology parks for provision of such services are vital: Where the required infrastructure is present, technology parks should accommodate firms which cater to accounting services, this is especially important for start-ups who might not be able to initially pay the high cost of renting real estate.

Domestic regulations need to be redrafted & regulatory bodies strengthened: Gaps in domestic regulations should be addressed by a gradual adoption and effective implementation of basic internationally recognized regulatory principles such as the OECD good regulatory practices. Further, there is a need to improve capacity in the regulatory bodies which oversee the sector.

The PBC is a private sector not-for-profit advocacy platform set-up in 2005 by 14 (now 94) of Pakistan’s largest businesses. PBC’s research-based advocacy supports measures which improve Pakistani industry’s regional and global competitiveness. More information about the PBC, its members, objectives and activities can be found on its website: www.pbc.org.pk

• What are services exports, how are they different from goods and what is their quantum?
• How is the global trade in services classified?
• Which are the major globally traded services?
• Which countries dominate the global trade in services?
• Where does Pakistan feature in the global trade in services?
• Which are the services in which Pakistan can look to increase its exports?
• The major challenges facing services exports from Pakistan are?
• What are the policy recommendations for increasing services exports from Pakistan?

What are services exports, how are they different from goods exports what is their quantum?

A services export is any service that is provided by a resident in one country to people or companies from another country. In contrast to goods, services are intangible. This means that services, as opposed to goods, cannot be touched, felt or seen, services thus can only be experienced.

In 2020, the quantum of global services trade was about $5.0 trillion.

How is the global trade in services classified?

Services trade is classified under broad categories such as Travel, Transport, Financial, Other business services, Telecommunications, computer and information services, etc. Global trade in services is classified by the IMF under BPM6/ EBOPS 2010. The IMF’s method of classification has been used in this report.

Which are the major services exported globally?

Top 5 Global Services Exports Categories in 2020

Which countries dominate the global trade in services?

Top 5 Services Exporting Countries in 2020

Where does Pakistan feature in the global trade in services?

Pakistan was Ranked 61^st in the World in 2020 for Services Exports, with its Services Exports being about $5.4 billion, and with a CAGR of 1.5% between 2016 to 2020.

Pakistan’s Services Exports and Major Markets

Pakistan has improved from being ranked 77^th in 2019 to being 61^st in 2020. Pakistan however, has the potential to improve its rank in the coming years.

Which are the services in which Pakistan can look to increase its exports?

Based on global demand and Pakistan’s own strengths, Pakistan’s focus should be on selected categories instead of trying to cater to a wide portfolio of services. In the initial phase it can look to expand exports in existing markets. Below are the markets and the selected categories on which Pakistan should focus in the near to medium terms.  Pakistan’s current exports and total imports for these classifications by the identified countries is also given below:

Pakistan’s Existing Top 5 Markets in 2020 & Suggested Services Categories for Specialization

At the moment, Pakistan does not trade in Classification 1, Manufacturing services on physical inputs owned by others. However, Pakistan can seek to enter this services category and initially export to its current markets as a way of Product Development. Doing so, will diversify Pakistan’s services exports and could lead to an increase in its overall services exports.

The exports of Classification 1, Manufacturing services on physical inputs owned by others were about $115.2 billion in 2020. France and Ireland, are the top 2 importers of Classification 1, and had CAGRs of 5.3% and 25.0% for the period 2016 to 2020.

The major challenges facing services exports from Pakistan are?

For Pakistan to expand its services exports, it needs to address some of the challenges identified below:

Infrastructure Related Challenges:

• There are multiple regulatory authorities for a single service sector, this leads to an overlap in regulations.
• Service providers face difficulties due to ambiguities in tax laws.
• Connectivity, which is a pre-requisite for IT & IT enabled services is not as per global standards.
• Weak enforcement of intellectual property rights is hampering Pakistan’s potential in services exports.
• Industry-Academia linkages are mostly missing in Pakistan.
• Skills and training wise, Pakistan lags behind its major competitors in several services categories.

Trade-related Issues:

• Specific incentives for services exporters are missing.
• Industry participants are unaware of incentives available in existing Trade Agreements.
• Services are given less importance while negotiating Trade Agreements
• Pakistani services exporters face challenges in moving freely across borders and this hinders services exports from Pakistan.

Market Related Issues

• There is an absence of a Services Exports Strategy
• Pakistan’s services exports lack visibility in global markets and Pakistan rarely participates in services exports fairs.
• There are problems of accreditation and acceptance of Pakistan’s Services in the global market.

What are the policy recommendations for increasing services export from Pakistan?

Improving Infrastructure as it Relates to the Services Sector

• Establish a mechanism that promotes Inter-agency coordination and curbs regulatory bottlenecks
• Rationalize the Taxation System in Pakistan
• Improve Industry-Academia Linkages
• Educational and Vocational Training needs to be upgraded
• Improve the general Business Environment

Trade-related Policies

• Engage in Services Agreements and Advocate for Freedom of Movement of persons
• Provide Incentives for Service Exporters

Accessing International Markets

• Specialize in Certain Services Sectors based on market demand and Pakistan’s potential
• Expand Current Markets and Explore New Markets
• Participate in Global Fairs for services exports

This report’s aim to provide a basic understanding of the Global Services Trade and Pakistan’s ranking. Having developed a better understanding of the services sector, the PBC in the next phase will do in-depth studies relating to competitiveness of selected sectors with the objective of recommending policy frameworks for enhancing these sectors competitiveness.

The PBC is a private sector not-for-profit advocacy platform set-up in 2005 by 14 (now 86) of Pakistan’s largest businesses. PBC’s research-based advocacy supports measures which improve Pakistani industry’s regional and global competitiveness. More information about PBC, its members, objectives and activities can be found on its website: www.pbc.org.pk