Comment by Riaz Haq on April 1, 2025 at 9:14am

Opinion | How tech innovation can bolster Pakistan’s relationship with China | South China Morning Post

By Thomas G. Tsao is co-founder and chairman of Gobi Partners, an Asia-focused venture capital firm

https://www.scmp.com/opinion/asia-opinion/article/3304588/how-tech-...

Pakistan has the potential to become a land of opportunity for start-ups, powered by its young, tech-savvy population of 240 million. But its founders are facing a series of challenges, including political instability and a funding downturn, which has hit Pakistan hard. One way to overcome those obstacles is by deepening its connection with China. And encouraging Pakistan’s innovation can benefit both countries.
China and Pakistan’s diplomatic partnership dates back nearly 75 years. The China-Pakistan Economic Corridor (CPEC) is a critical part of Beijing’s Belt and Road Initiative, and, under the CPEC, China has invested billions of dollars into Pakistan’s physical infrastructure.
This partnership is expanding to digital infrastructure, too, with the CPEC covering initiatives such as joint research and technology transfer centres. When President Xi Jinping and Pakistan President Asif Ali Zardari met in Beijing in February, science and technology were among the areas on which they signed bilateral cooperation documents.

The collaboration also extends to the provincial level. In January, Punjab Chief Minister Maryam Nawaz told Chinese investors that the province, which is Pakistan’s largest by population, aspires to build the biggest AI centre in the country with China’s cooperation.


---------------


Pakistan faces serious challenges...In spite of these issues, the groundwork is being laid for Pakistan to become a meaningful tech collaborator with China. Pakistanis are embracing technology in large numbers. Broadband users nearly doubled between 2019 and 2024 from 69 million to 135 million, according to the Pakistan Telecommunication Authority, and that number continues to climb.

This mass adoption enables digital innovations to reach a significant audience and generate revenue. For example, e-commerce spending in Pakistan increased from US$2.2 billion to US$5 billion during the same five-year period, based on Datareportal figures.

The political landscape is also now more promising for start-ups, thanks to the formation of a six-party coalition government last year, with the Pakistan Muslim League leading the country for the next five years. This stability enabled Pakistan to negotiate a US$7 billion loan with the International Monetary Fund, boosting government initiatives to stabilise the economy and lower interest rates. This will help revive investor interest.
Government tech policies also have a better chance of bearing fruit. While innovation crosses sectors, fintech is emerging as a fast-growing area, driven by a young population seeking convenience in how they transact and the State Bank of Pakistan’s proactive policies. Licences for digital banks are being issued steadily, signalling long-term support for the sector.

As Pakistan and China continue their focus on technology and innovation, the ecosystem is set to flourish. Knowledge-sharing between the two can go both ways. Sectors where Pakistan can collaborate with China include agritech and fintech.

For example, Pakistan’s agricultural industry, which accounts for 24 per cent of its gross domestic product according to the government, can benefit from tech transfer with China’s smart farms. A new AI app called Kisan360, a joint project between Chinese and Pakistani researchers, recently launched to help farmers monitor their fields with the aid of drones and computer vision.
The Pakistani government also recently rolled out the Green Pakistan Initiative to find tech-enabled ways to strengthen development of the agricultural industry. The initiative has strong potential to complement China’s five-year action plan to digitise its agricultural industry.

Comment