Pakistan’s digital opportunity3 The Digital FDI-Enabling Project aligns strongly with the emerging digital agenda in Pakistan and represents a high-impact opportunity to stimulate progress on supporting growth of the digital economy. Positioning Pakistan as a digital-friendly destination has been a priority for governments since 2018 when the first Digital Pakistan Policy was announced. Since then, several initiatives have helped strengthen elements of the digital ecosystem. IT exports have been growing and reached $3.2 billion by 2024.34 After elections in 2024, the newly formed government approved a comprehensive transformation plan called Digital Nation Pakistan, which focuses on the digital economy, society and government as levers for growth in investment, exports and digitalization of sectors. Realizing that there are institutional challenges to promoting and implementing a coherent digital agenda, the government formed the National Digital Commission, headed by the prime minister, and it has been working on the establishment of the Pakistan Digital Authority as a central agency to oversee and implement a coherent digital agenda throughout the country. The government is also undertaking various ongoing and planned initiatives, including the Pakistan Regulatory Modernization Initiative (PMRI) and the World Bank-sponsored Digital Economy Enhancement Project (DEEP), aimed at fostering a thriving digital economy through enhanced regulatory support. The Asaan Karobaar Act simplifies business regulations, while the DEEP promotes digital infrastructure regulatory frameworks. The BOI plans to launch the Pakistan Business Portal to streamline business registration, applications and payments. Digital transformation holds immense economic potential for Pakistan and, if fully effected by 2030, could create up to PKR 9.7 trillion ($34.9 billion) in economic value (estimated by Access Partnership in 2021).353.1 Digital Nation Pakistan The country’s developing digital market holds significant potential for investors, with an untapped consumer base, sectors ripe for innovation and increasing government incentives to attract foreign capital. A large, young population further boosts the prospects for digital adoption and growth in digital services. There is untapped potential for digital growth if challenges such as macroeconomic fluctuations, political transitions and regulatory complexities are addressed. Expanding connectivity infrastructure, especially in underserved areas outside major cities, presents significant opportunities to bridge digital divides and accelerate comprehensive digital development. The opportunities and challenges listed in Sections 3.2.1 and 3.2.2 emerged from consultations with 70 local and international stakeholders within Pakistan’s digital ecosystem. They provide a comprehensive briefing on the critical factors shaping Pakistan’s digital landscape and identify target areas for policy interventions and recommendations.3.2 Unlocking potential: Analysing Pakistan’s digital investment landscape Digital FDI Initiative: Digital FDI-Enabling Project in Pakistan 15

Digital FDI Initiative Pakistan 2025