Pakistan continues to trail behind its regional counterparts in harnessing the benefits of digital trade, with regulatory delays, weak infrastructure, and lack of coordinated policymaking holding back its competitiveness. The Asian Development Bank (ADB), in its recent report released on September 19 titled Digitally Connected Central Asia Regional Economic Cooperation (CAREC): Digital Trade, Emerging Regulatory Challenges, and Solutions, cautioned that Pakistan’s slow progress in implementing reforms could leave it sidelined from rapidly expanding global digital supply chains.
Despite its strategic location at the intersection of South and Central Asia, Pakistan has yet to introduce meaningful reforms to support cross-border e-commerce and digitally delivered services. The ADB highlighted that countries such as Georgia, Kazakhstan, and Pakistan have not ratified the UNESCAP Framework Agreement on Facilitation of Cross-Border Paperless Trade in Asia and the Pacific, an initiative aimed at accelerating digital trade measures. The lack of alignment with international frameworks is adding to existing challenges, limiting Pakistan’s ability to attract investment and foster regional integration. According to ADB data, Pakistan’s digitally delivered trade in 2024 was valued at $7.93 billion, significantly lower than ASEAN economies such as Malaysia at $39.04 billion, the Philippines at $38.57 billion, and Thailand at $50.57 billion. Intra-CAREC trade, excluding China, accounted for just 7% of total trade, compared to ASEAN’s 24%, underscoring weak integration within the bloc.
The report identified several obstacles that hinder Pakistan’s digital trade growth. Infrastructure gaps, including poor connectivity, limited data centres, and lack of payment interoperability, continue to restrict digital activity. Regulatory misalignment, especially the delays in adopting the UNESCAP framework and absence of a unified digital regulatory environment, compounds these challenges. Consumer protection and enforcement also remain underdeveloped, with Pakistan yet to match ASEAN countries that have enacted comprehensive data privacy and cybercrime legislation. Although the establishment of a single-window system has improved trade facilitation to some extent, ADB noted that the implementation remains fragmented and inconsistent with international practices, limiting efficiency and trust among regional partners.
Speaking to the media, banking and financial services analyst Ibrahim Amin stressed the importance of internal reforms, pointing out that most government and private organisations lack consolidated data structures. He highlighted that many institutions have multiple departments maintaining separate systems without integration, making collaboration and digital efficiency nearly impossible. He added that unless organisations consolidate internally, industry-wide reforms would remain ineffective. Amin specifically cited examples in sectors like banking, where major institutions still operate with disconnected departments, leaving little room for innovation or industry collaboration.
ADB warned that without immediate corrective measures, Pakistan risks exclusion from global trade networks where harmonised frameworks, advanced digital infrastructure, and cross-border interoperability are becoming the standard. It recommended that Pakistan adopt a long-term policy framework that focuses on coordinated implementation, investment in smart ports, regional digital trade corridors, and a digital single window to streamline processes. The report also underscored the importance of training programmes to develop digital skills, with particular emphasis on empowering women and youth, ensuring that growth remains inclusive. Amin supported this perspective, adding that consolidation of systems and synchronisation of data should be the first step for Pakistan. Without knowing its own internal capacities, he argued, the country would struggle to achieve meaningful innovation, highlighting that research, development, and talent creation all depend on an integrated digital foundation.
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