Pakistan’s efforts to modernize public services and tax administration using artificial intelligence are encountering structural and operational challenges, according to the Asian Development Bank. Fragmented data systems, weak coordination among government agencies, limited institutional capacity, and low digital literacy are identified as significant obstacles that slow the adoption of technology-driven solutions across departments. ADB experts highlighted that successful implementation of AI tools depends less on deploying complex systems and more on empowering officials to shape, design, and manage these tools effectively.
Farzana Noshab, Lead Economics Officer at the Public Sector Management and Governance Sector Office, and Yuji Miyaki, Public Management Specialist for Taxation, noted in a recent blog post that empowering public officials to guide system development is critical. Mehwish Salman Ali, CEO and Founder of Data Vault Pakistan and ZahanatAI, emphasized the importance of locally developed solutions. She explained that public sector departments are increasingly adopting AI-enabled chatbots and other digital tools to structure databases and streamline services. Ali stressed that these systems should remain within the country, hosted on local data centers, and integrated with domestic business and government data, allowing government agencies to have active input in system functions rather than relying solely on external suppliers.
Recent tax reforms led by Federal Board of Revenue illustrate the impact of effective digital tools on public service delivery. The FBR has introduced an electronic tax return system with auto-fill features and is developing tailored forms for different taxpayer groups, including an Urdu-language version. Additional upgrades include real-time data sharing, automated withholding tax payments, and digital invoicing, reducing previously complex procedures to simpler, user-friendly steps. According to ADB, these reforms show that AI and digital tools work best when redundant steps are eliminated, documentation is standardized, and data formats are harmonized across multiple agencies.
Dr. Noman Ahmad Said, CEO of SI Global Solutions, highlighted the importance of training both officials and the public to use these systems effectively. Online courses, university boot camps, and targeted training programs are recommended to ensure adoption and sustainable results. Multilingual chatbots and AI-enabled modules initially developed for tax services could eventually extend to other sectors, including health, employment, and disaster response. Planning for such expansion from the outset ensures that digital tools are integrated across services while remaining accessible to citizens with varying literacy levels and internet connectivity.
ADB experts noted that many initiatives rely on external suppliers who develop systems without adequately involving government staff, resulting in slow adoption and solutions misaligned with real-world needs. Strengthening the capacity of public officials and engaging them early in the planning and design stages is essential to deliver meaningful improvements in service efficiency, transparency, and accessibility. Pakistan’s ongoing public service modernization efforts demonstrate the potential of AI and digital tools to enhance governance, provided structural gaps and institutional limitations are addressed to benefit citizens effectively.
Follow the SPIN IDG WhatsApp Channel for updates across the Smart Pakistan Insights Network covering all of Pakistan’s technology ecosystem.
