The Asian Development Bank (ADB) has raised alarm over Pakistan’s lagging digital transformation, citing structural weaknesses, policy inertia, and a lack of investment as major obstacles to modernising the country’s telecom and digital ecosystem.
In a detailed report released this week, the ADB warned that Pakistan is falling significantly behind regional and global peers in terms of digital connectivity, infrastructure expansion, and equitable access. The report serves as a critical wake-up call to policymakers, underlining the urgency of reforms in a sector increasingly pivotal to economic growth.
According to ADB’s assessment, Pakistan’s telecom sector—currently valued at $4.52 billion—is projected to grow to $5.32 billion by 2029. However, this growth is threatened by the country’s chronic underinvestment in fibre-optic networks and long delays in spectrum auctions, particularly for 5G technology. Political instability and inconsistent digital policy execution over the last five years have further exacerbated the problem.
The report notes that Pakistan remains one of the most heavily taxed telecom markets in the region, which discourages both foreign and domestic investment while also making internet services less affordable for users. Despite mobile internet coverage reaching 80% of the population, actual digital adoption remains low due to affordability barriers and digital literacy gaps.
Perhaps most notably, Pakistan has yet to launch 5G services, even as 101 countries have already done so commercially. The government has also made no recent spending on 3G spectrum development, indicating stagnation in the overall network evolution. These delays signal missed opportunities in enhancing connectivity, improving service quality, and driving economic digitisation.
Another troubling revelation is that Pakistan’s digital economy contributes only 1.5% to GDP, far below its regional potential. In contrast, neighbouring countries such as India and Bangladesh have made considerable progress in expanding their digital economies through proactive public-private investment and regulatory reforms.
Fixed broadband penetration in Pakistan remains at a dismal 1.3%, one of the lowest figures across Asia. This severely limits the ability of households, especially in rural and underdeveloped regions, to access reliable high-speed internet—a key enabler for education, e-commerce, digital finance, and remote work.
The ADB also underscored alarming gender disparities in mobile and internet usage. While 86% of Pakistani men own a mobile phone, the number drops to 53% for women. Similarly, 53% of men have access to the internet, compared to just 33% of women. These figures highlight deep-rooted structural barriers that limit digital inclusion for women, including affordability, social norms, and lack of targeted outreach.
Affordability of internet-enabled devices and data plans was flagged as a major challenge across low-income and rural communities. “Cost remains a key impediment to meaningful participation in the digital economy,” the report said, adding that many families, particularly in rural areas, continue to prioritise basic needs over digital connectivity.
In light of these findings, the ADB has called on the Government of Pakistan to undertake urgent corrective measures. The report recommends:
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Accelerating spectrum auctions and launching 5G services without further delay.
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Expanding investment in fibre-optic infrastructure, especially in underserved regions.
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Reforming the telecom tax regime to incentivise private sector investment and reduce consumer prices.
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Launching gender-responsive and income-sensitive digital inclusion programs.
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Enhancing digital literacy and introducing targeted subsidies for device ownership and internet access among marginalised groups.
The report stressed that without such reforms, Pakistan risks widening its digital divide and missing out on the immense economic and social benefits of a thriving digital economy.
As Pakistan enters a new fiscal cycle under ongoing IMF and World Bank-backed reform programs, sector stakeholders are hopeful that telecom and digital policy will receive the attention and investment it critically requires.
