Through enhanced cooperation in information technology (IT) between Azerbaijan and Pakistan, Azerbaijan can not only meet the local market's demand for IT services but also export these services to the US, Europe, and the Middle East, Khurram Javaid Bhatti, President of the Pakistan-Azerbaijan Chamber of Economic Cooperation (PAKAZCHAM), told Report.
Bhatti highlighted the successful cooperation between the two countries in the IT sector, stating: "Several IT companies have already started operating in Azerbaijan, offering cybersecurity and outsourcing services. There is significant potential to attract new companies to Azerbaijan. This initiative not only aims to meet Azerbaijan's market needs but also to export services from Azerbaijan to the US, Europe, and the Middle East."
The president also pointed out that a Memorandum of Understanding on cooperation in ICT and Technology Training Courses was signed between Azerbaijan's Innovation and Digital Development Agency under the Ministry of Digital Development and Transport and Pakistan's Commission on Science and Technology for Sustainable Development in the South (COMSATS): "The key aspect of this initiative is to train Azerbaijani youth in IT outsourcing services, which will increase employment opportunities and strengthen the country's export capabilities, while expanding the labor market and contributing to the development of Azerbaijan's IT sector."
Starting in 2023, incentives are being applied to the ICT sector in Azerbaijan. Companies operating in IT outside technoparks are now granted technopark resident certificates and are fully exempt from the 20% profit tax and 14% income tax.
Additionally, business entities are exempt from paying the 10% dividend tax withheld at the source during profit distribution. For employees of technopark resident companies, income tax is set at 0% for portions up to 8,000 manats ($4,705), and 5% for portions exceeding 8,000 manats. From next year, for a period of seven years, all income will be taxed at a flat rate of 5%.
