KARACHI: The Pakistan Business Council (PBC) issued a warning on Friday that several multinational companies are planning to relocate their back offices from Pakistan, with many having already made the move recently.
This warning follows a report by the Dubai Chamber of Commerce, which revealed that 3,968 Pakistani companies registered in Dubai between January and June 2024, making Pakistan the second-highest contributor to the list. This represents a 17 percent increase from the 3,395 firms registered in the same period in 2023.
In total, the Dubai Chamber of Commerce recorded 8,036 new Pakistani businesses last year.
The rising number of Pakistani businesses setting up in Dubai underscores a growing exodus from Pakistan, which is already facing severe unemployment and sluggish economic growth. As hundreds of thousands of skilled and unskilled workers leave the country, millions more are reportedly seeking opportunities abroad.
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 due to widespread internet disruptions caused by the reported imposition of a firewall.”
This trend reflects a growing lack of confidence in the government’s economic policies. Contributing factors include the high cost of doing business, political instability, rising electricity prices, and worsening law and order.
The PBC further noted, “As we grapple with the costs of idle power generation capacity leading to unemployment and lost exports and tax revenue, we now face the threat of idle capacity in the emerging software sector due to ineffective firewall implementation.”
The tech industry has expressed grave concerns about the recent internet slowdown, warning that these disruptions could cost Pakistan up to $300 million. The PBC urged authorities to either correct the firewall implementation or ensure it does not negatively impact employment and exports.
The council highlighted that IT and IT-enabled services, along with agriculture and tourism, are crucial for achieving the Prime Minister’s export targets over the next three years. High-speed connectivity is essential for the domestic economy, it added.
The Overseas Investors Chamber of Commerce and Industry (OICCI) also cautioned that frequent internet disruptions could impede the country’s economic progress.
The Pakistan Software Houses Association warned that these disruptions are more than just inconveniences; they represent a serious threat to the industry’s viability, causing financial losses estimated at $300 million, which could potentially rise even further.
