The country, already struggling with economic disparities, is now confronting yet another challenge, further undermining its chances of economic growth. For weeks, internet speeds in Pakistan have been noticeably slow, causing significant disruption to e-commerce businesses. While some attribute the slowdown to the installation of a firewall and others to the use of VPNs, the exact cause remains unclear. What is certain, however, is that multinational firms are bearing the brunt of this issue. As a result, multinational firms operating in Pakistan are now considering relocating to other countries, unable to sustain further losses to their operations.
The Pakistan Business Council (PBC) has now issued a warning about the potential relocation of multinational firms, underscoring the growing concern. This trend is reflected in the sharp increase in Pakistani businesses registered in Dubai, with 8,036 new companies established last year alone. As per the business owners, high-speed internet connectivity is essential for the smooth flow of operations in Pakistan and if the situation persists, they would be taking action of relocating their businesses to other countries, particularly Dubai.
The Pakistan Business Council (PBC) stated, “Many multinational companies (MNCs) are either planning to relocate their back offices from Pakistan or have already done so, as the reported imposition of a firewall causes widespread internet disruptions across the country.” It further said,
“While we struggle with the costs of idle capacity in power generation leading to unemployment and loss of exports and tax revenue, we now have to contend with the threat of idle capacity in the emerging software sector due to poor execution of a firewall.”
It is pertinent to mention here that the loss associated with the internet disruption in Pakistan has amounted to $300 million, as per the Pakistan Software House Association. As per the statement issued by IT council, “IT and IT-enabled services, besides agriculture and tourism, offer a valuable opportunity to achieve the PM’s export target over the next three years. High-speed connectivity is also vital for the domestic economy.”
Hence, multinational firms are unable to further bear the brunt of internet slowdown in Pakistan on their businesses operating here.
