Silicon Valley Investors Turn To Pakistan Amid India’s Digital Curbs, Market Saturation

ISLAMABAD: India’s hegemonic designs and increasing digital restrictions are forcing global tech investors, including those from Silicon Valley, to redirect their focus towards Pakistan’s burgeoning tech ecosystem and facilitation at the highest level of the Special Investment Facilitation Council (SIFC).

This visible shift in investors’ profiles that are importing Information Technology (IT) services and outsourcing business process to this part of world, is influenced by Pakistan’s recent surge in IT exports, a youthful and tech-savvy population, a commitment to digital openness and one-window facilitation.

As against red-tapism and bureaucratic inertia investors are still faced with in India, Special Investment Facilitation Council (SIFC) is just one such window to address almost all issues an investor could face in foreign a country.

It is a body supra all the bureaucratic structure as it is chaired by no one less than the Prime Minister and is co-chaired by the Chief of Army Staff just to ensure investments, especially by the foreign investors, do not face any bottlenecks or impediments whatsoever.

That is why perhaps, Pakistan’s IT exports reached a record $3.223 billion in the fiscal year 2023-24, marking a 24% increase from the previous year. December 2024 alone saw exports hitting $348 million, the highest monthly figure to date.

Prime Minister Shehbaz Sharif has already set an ambitious target of $25 billion in IT exports over the next five years, aiming to capitalize on the country’s growing digital capabilities.

Minister of State for Information Technology and Telecom, Shaza Fatima Khawaja, highlighted the sector’s momentum, stating, “Pakistan’s tech ecosystem has shown remarkable growth over the last few years, propelled by a thriving environment of entrepreneurship, innovation, and strong governmental support. We are working on building global linkages and facilitating investors through smart regulations and incentives.”

In contrast, India experienced 84 internet shutdowns in 2024, the highest among democratic nations, according to a report by Access Now.

These frequent disruptions — imposed during political unrest, exams, or protests — have raised deep concerns among international firms relying on stable and open digital environments for operations.

This regulatory volatility is increasingly pushing global investors to consider alternate regional destinations.

Pakistan, with its transparent data protection law under development, digital transformation roadmap, and favorable Special Technology Zones (STZs), has become a promising choice.

The International Telecommunication Union (ITU) placed Pakistan in the Tier-1 category of its Global Cybersecurity Index, citing improved digital governance.

Furthermore, Pakistan’s youthful demographic, with 63% of the population under 30, and the annual production of 75,000+ IT graduates, provides a robust, English-speaking, low-cost workforce. However, a newspaper report cautioned that only 10% of graduates are immediately employable, in global export markets, citing skill mismatches.

To bridge this gap, the government has revived and expanded the Prime Minister’s Youth Programme, offering interest-free loans, laptops, and free technical training under initiatives like PM Youth Skill Development and National Innovation Awards. This year alone, over 100,000 youth received skill certifications in programming, cloud computing, and mobile app development.

International partners are also supporting these efforts. Japan’s Ambassador Akamatsu Shuichi recently lauded Pakistani professionals at a stakeholder forum in Islamabad, stating, “We anticipate rising demand for skilled Pakistani professionals, particularly in IT, as Japan seeks high-quality human resources. Our programs now focus on training youth in Pakistan and creating pathways to employment in Japan.”

Similarly, China and Belarus have signed recent labor mobility agreements to import Pakistani engineers and IT specialists. According to the Ministry of Overseas Pakistanis, these arrangements could generate up to 150,000 skilled positions over the next three years.

“Pakistan’s human capital is our biggest export potential,” said Chaudhry Salik Hussain, Federal Minister for Overseas Pakistanis. “With strong bilateral cooperation and skill enhancement, we can turn youth into a global digital workforce.”

Meanwhile, Silicon Valley venture funds, including some with links to South Asian diaspora networks, have begun diversifying their portfolios to include Pakistani fintechs, healthtechs, and edtech startups. Investors cite market saturation, regulatory opacity, and increasing authoritarian controls in India as risk factors.

“What Pakistan offers today is not just cost advantage but a more open digital society. That’s increasingly critical for cross-border data services and remote work,” said Aisha Khan, a Bay Area-based investor affiliated with an early-stage impact tech fund.

Despite challenges such as occasional internet disruptions and macroeconomic instability, Pakistan’s digital economy appears to be entering a new phase — one where policy momentum, global interest, and regional dynamics are converging in its favor.