Pakistan's New Infrastructure Investments and Trade Routes

Pakistan has recently launched 5G wireless service in multiple cities and closed financing on the 306 kilometer 6-lane Sukkur-Hyderabad M6 motorway. In addition, Pakistan is seeing significant increase in the utilization of its Gwadar and Karachi ports after the closure of the Strait of Hormuz due to the US-Iran war. This will help open the trade routes from Pakistan to Central Asia via Iran, bypassing unstable Afghanistan. It has the potential to eventually make Pakistan a major transshipment hub for the region extending to the land-locked Central Asian Republics. Another major news is the Asian Development Bank financing of cross-border connectivity of the power grid and digital networks. These developments are expected to substantially enhance economic activity in the country, in spite of the short-term negative impact of the energy crisis, particularly in oil and gas imports. 



5G Launch:

Wireless carriers Jazz and Zong have launched 5G services across Pakistan in March 2026.  This will further expand and enhance Pakistan's digital public infrastructure. Jazz launched its 5G service across major cities, including in Islamabad, Rawalpindi, Lahore, Karachi, Peshawar, Quetta, Multan, and Faisalabad. Meanwhile, Jazz's competitor Zong is targeting over 16 cities with 5G speeds exceeding 1.4Gbps. 

During the March auction, a total of 480 MHz of spectrum was sold across multiple bands for over $500 million, with Pakistan's main telcos, Jazz, Ufone, and Zong, snapping up the assets. Pakistan Telecommunication Authority (PTA) put a total of 597 MHz of spectrum on the table, with just over 100 MHz of this going unsold.

M6 Motorway:

Pakistan has signed an agreement with the Asian Development Bank (ADB) for $235 million in financing for two sections (120 miles) of the M6 motorway in Sindh province. The Islamic Development Bank (IDB) and the OPEC Fund have already agreed to finance three other sections of this motorway. 

The M-6 motorway is the only missing segment in the north-south motorway route linking Karachi to Peshawar. The 306-kilometer-long, six-lane motorway will have 15 interchanges and 10 service areas.

Cross-Border Grid Connectivity:

Pakistan is joining the Pan-Asia Power Grid Initiative sponsored and financed by the Asian Development Bank which will provide $50 billion for power and $20 billion for digital infrastructure. The project will link grids, boost power trading, improve broadband and develop AI-ready communities across Asia, the Pacific. 

Iran Trade Routes:

Pakistan has opened six land transit routes for goods destined for Iran, creating a road corridor through its territory as thousands of containers remain stranded at Karachi port because of the United States blockade of Iranian ports and ships trying to pass through the Strait of Hormuz.

This development signals a major shift away from the Gulf trade infrastructure Iran had long relied upon, particularly through Jebel Ali Port in the United Arab Emirates. This represents an opportunity for Pakistan to create new trade routes to Central Asian Republics bypassing Afghanistan, eventually making Pakistani ports a major transshipment hub for the entire region. 

Pakistan's newest Gwadar Port has already seen a major surge in activity, handling around 11,000 containers in April 2026 alone, surpassing its entire 2025 volume. The increase comes as shipping companies adjust routes due to disruptions near the Strait of Hormuz, pushing traffic toward safer alternatives.

Space Program:

Pakistan's space agency SUPARCO has achieved a major milestone by launching five indigenous satellites over the last 16 months (early 2025 – April 2026), marking a shift toward rapid space technology expansion. The fleet, aimed at Earth observation and agriculture, includes EO-1, EO-2, AI-powered EO-3, and Pakistan's first hyperspectral satellite, HS-1

HS-1 is Pakistan's first hyper-spectral  satellite which is equipped with advanced hyperspectral imaging sensors capable of capturing data across hundreds of narrow spectral bands.  The satellite lifted off from China’s Jiuquan Satellite Launch Center on a Kinetica-1 rocket. It is expected to boost Pakistan's national capacities in areas such as precision agriculture, environmental monitoring, urban planning, and disaster management. Its high-resolution data will support improved resource management and strengthen Pakistan’s resilience to climate-related challenges. 

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  • Riaz Haq

    Pakistan Growth Accelerates Even as Iran War Raises Risks - Bloomberg
    The committee approved provisional GDP growth of 3.7% for the fiscal year ending June, expanding the size of the economy to $452 billion.
     
    ————-

    Pakistan’s economy accelerated in the last quarter even as the rising global crude prices due to the Iran conflict cloud the outlook for the nation, which imports most of its fuel requirement.

    Gross domestic product accelerated to 3.99% in the three months ended March, compared with 2.4% a year earlier, according to data released by the Pakistan Bureau of Statistics. The economy grew 4.05% in the preceding quarter after the data was revised. 

    The committee also approved provisional GDP growth of 3.7% for the fiscal year ending June, expanding the size of the economy to $452 billion.

    Pakistan’s economy remains fragile, with uneven growth and continued reliance on support from the International Monetary Fund and external inflows, even as easing inflation is offset by rising food and energy prices. The crisis in Middle East has added uncertainty as higher imported oil costs threatens to further widen the trade deficit and deplete foreign exchange reserves.

    Pakistan to Receive $1.32 Billion as IMF Board Approves Tranches

    According to the data, agriculture grew 3.01% in the third quarter, while industry and services expanded 4.65% and 4.18%, respectively, underscoring improving momentum in key sectors of the economy.

  • Riaz Haq

    Pakistan says 30 percent of over $10 billion MoUs with China translated into potential projects

    https://www.arabnews.com/node/2643439/pakistan

    Pakistan and China have signed various MoUs on trade, investment, technology, digital cooperation in recent years
    Pakistan launches Digital Economic Center in Islamabad set up by Chinese industrial e-commerce giant IBI Guolian Gufan

    ISLAMABAD: Pakistan’s Deputy Prime Minister Ishaq Dar announced on Wednesday that around 30 percent of Islamabad’s memoranda of understanding (MoUs) with China, under various sectors amounting to over $10 billion, have been translated into potential projects.

    The Pakistani deputy premier was speaking at the launch of the IBI Pakistan Digital Economic Center in Islamabad. Set up by IBI Guolian Gufan, a Chinese company focused on industrial e-commerce and digital supply chains, the initiative seeks to advance digital trade, industrial connectivity and supply chain integration between the two countries.

    Pakistan and China have highlighted digital cooperation as the next phase of their multi-billion-dollar China–Pakistan Economic Corridor (CPEC) project. Beijing refers to this cooperation initiative with countries as “The Digital Silk Road.”

    The Digital Silk Road is a component of China’s Belt and Road Initiative. It finances and supports digital connectivity infrastructure to support Beijing’s technology companies, goods and services. Pakistan hopes aligning with this digital track will help modernize its local industry and support its aim to become a regional digital transit and services hub.

    “We can see the difference that 30 percent of the almost over $10 billion of MoUs signed have already been translated into real, potential projects which are being virtually finalized,” Dar told participants of the ceremony in Islamabad.

    He said the launch of the IBI Pakistan Digital Economic Center in Islamabad marks the beginning of the Digital Silk Road in Pakistan. Dar noted that cooperation between Pakistan and China in artificial intelligence and emerging technologies is also expanding rapidly, with both sides strengthening collaboration in the IT sector as well.

    Dar appreciated the IBI’s entry into Pakistan, noting that it was a platform serving millions of enterprises across over 100 industrial sectors in China.

    “And that reflects strong confidence in our economy and future potential,” he said.

    Speaking at the ceremony earlier, IT Minister Shaza Fatima Khawaja said Pakistan passed the Digital Nation Pakistan Act last year to transform the country into a digital society, economy and governance model.

    She said the digitization of Pakistan’s industry can alone unlock anywhere between five to seven percent of the GDP, stressing that it would mean additional $20-30 billion added to the economy by 2030.

  • Riaz Haq

    From Arif Habib Ltd:

    Industry and Services mainly drive stronger growth in 3QFY26

    * Pakistan’s GDP growth for 3QFY26 clocked in at 3.99%, driven by industry (4.7%) and supported by agriculture (3.0%) and services (4.2%), while the latest release also incorporated revisions to earlier estimates.
    * 1QFY26 growth was revised upward to 3.92% from 3.63%, while 2QFY26 growth was also adjusted higher to 4.05% from 3.89%.
    * Meanwhile, the final revised GDP growth rates for FY24 and FY25 now stand at 2.62% and 3.18%, respectively.

    https://x.com/arifhabibltd/status/2054488795727155711?s=61&t=mg...