Challenges Facing Pakistan's Digital Sector: ADB Report Highlights Urgent Needs

An extensive report released by the Asian Development Bank (ADB) on July 15, 2025, has illuminated critical challenges facing Pakistan's digital sector, highlighting significant gaps in infrastructure and digital adoption that threaten the country’s economic growth. The report underscores Pakistan's stagnation in advancing digital connectivity, especially in comparison to other nations that are rapidly rolling out 5G technology, while Pakistan remains unable to auction its 5G spectrum despite 101 countries having launched commercial services.

According to the ADB report, Pakistan’s telecom sector, currently valued at approximately $4.52 billion, is projected to grow to $5.32 billion by 2029. However, this growth is jeopardized by insufficient investment in digital networks, primarily due to ongoing political instability and policy delays that have persisted for the past five years. Notably, the report highlights that Pakistan's digital economy contributes a mere 1.5% to the nation’s GDP, far below its potential.

The ADB report reveals alarming statistics regarding digital access in Pakistan. For instance, while around 80% of the population has mobile internet coverage, actual usage remains limited, with fixed broadband penetration at a mere 1.3%, one of the lowest rates in the region. The gender disparity in digital access is particularly concerning, with mobile phone ownership standing at 86% for men compared to only 53% for women; similarly, internet access reaches 53% of men and only 33% of women. This disparity highlights the challenges faced by low-income groups and women in accessing digital resources, largely due to affordability issues and the cost of internet-enabled devices, which are particularly prohibitive in rural areas.

Dr. Aisha Khan, a digital economy expert at the University of Karachi, emphasized the urgency of addressing these disparities. "The lack of investment in infrastructure, particularly in fibre-optic networks, is a significant barrier to our digital transformation. If we do not act now, we risk leaving millions behind, which would further exacerbate existing inequalities," she stated in an interview following the report's release.

Furthermore, the ADB has called for immediate policy reforms aimed at enhancing investment in digital infrastructure. The report suggests that the Pakistani government must prioritize digital inclusion strategies to ensure equitable access to technology for all citizens, particularly marginalized communities.

Economic analysts express mixed views on the potential for growth in Pakistan’s digital sector. Mr. Tariq Ahmed, CEO of Tech Solutions Pakistan, noted, “While the market has potential, the heavy taxation on telecommunications is discouraging both local and foreign investment, which is crucial for our digital landscape to evolve.”

The ADB report also warns of the implications of falling further behind in the global digital race. As nations worldwide accelerate their digital transitions, Pakistan risks being left out of the benefits associated with digital economies, which include improved productivity, economic growth, and enhanced quality of life.

In conclusion, the ADB report serves as a clarion call for action, urging policymakers to reform the regulatory landscape and invest in digital infrastructure to harness the full potential of Pakistan’s digital economy. Without these critical steps, the country will continue to lag behind its peers, missing out on opportunities for growth and innovation in an increasingly digital world.