At the recent CAREC Program held from April 17-19, 2024, in Astana, Kazakhstan, Pakistan’s Director General of Commerce, Mr. Muhammad Suleyman Khan, delivered a presentation showcasing the country’s rapidly evolving eCommerce landscape and the government’s targeted initiatives to drive further growth. His insights highlighted significant strides Pakistan has made in digital trade, a sector expected to play a pivotal role in the nation's economic future.

Opening Pakistan’s eCommerce Landscape

In recent years, Pakistan has experienced remarkable growth in eCommerce, with government efforts propelling this trajectory. The number of registered eCommerce merchants surged by 427% from FY19 to FY23, while the sector's overall value and volume saw increases of 444% and 457%, respectively. This growth has been fueled by a supportive policy environment, with significant contributions from the State Bank of Pakistan and the Pakistan Telecom Authority, whose recent data highlights a 79.5% mobile teledensity and a 56.2% broadband penetration rate as of early 2024.

Mr. Khan’s presentation underscored that Pakistan's digital economy is built on nine key pillars, from regulation, financial inclusion, and youth empowerment to ICT services and data protection. This cohesive policy framework is at the heart of Pakistan's Digital Pakistan Vision.

Key Policy Measures Powering Pakistan’s Digital Economy

Pakistan’s government has implemented multiple initiatives to foster an enabling environment for digital trade. The nation’s first eCommerce policy, introduced in 2019, set the stage, with subsequent policies like the National Cyber Security Policy 2021 and the Pakistan Cloud First Policy 2022 strengthening data protection, cybersecurity, and tech infrastructure. Collaborative efforts with global players are also in motion. Pakistan's MoU with China, signed in 2022, aims to boost cross-border eCommerce, while the free Digiskills program provides training in digital skills, already reaching nearly 3.9 million participants.

The government’s cross-border facilitation scheme has already garnered $68 million in exports since its launch in January 2021, demonstrating the potential of B2C small-packet exports. Furthermore, partnerships with tech giants like Alibaba aim to equip students and professionals with essential eCommerce skills, strengthening the talent pipeline for digital trade.

Bridging the Digital Gap: CAREC Member Countries’ Analysis

A significant part of the discussion in Astana revolved around the Digital CAREC analysis, which highlighted the regional digital gap among member countries. This gap emphasizes the need for a collaborative approach to align digital trade practices, infrastructures, and regulations across the region. Pakistan advocates for a shared CAREC trade portal and a dedicated eCommerce working group to foster cross-border digital trade within Central Asia.

Embracing Sustainable Trade Practices: Climate and Compliance Challenges

The conference also highlighted the importance of sustainable trade practices as climate change becomes a central concern. The EU’s Carbon Border Adjustment Mechanism (CBAM) and the push for environmentally friendly production processes are setting new compliance standards that could impact Pakistani exports, particularly in industries like iron, steel, and aluminum. Pakistan’s delegation voiced the importance of a balanced approach to these green compliance policies, advocating for the Polluters Pay Principle and Differentiated Responsibility to ensure fair regulations that consider developing countries’ capacities.

Addressing Key Challenges and the Road Ahead

Pakistan’s eCommerce journey faces several critical challenges, from high logistics costs for small-packet exports to a lack of collaboration with international payment providers like PayPal and Google Pay. Additionally, reliable and affordable internet access remains essential to expanding digital ecosystems across the country.

Mr. Khan outlined a forward-looking roadmap with recommendations such as establishing an eCommerce trade portal for CAREC members, facilitating international payment gateway linkages, and creating dedicated training programs. These steps, combined with climate-conscious strategies, aim to position Pakistan as a regional leader in digital trade and sustainable economic growth.

Looking Forward: Driving Pakistan’s eCommerce Potential

With strategic government interventions and strong regional cooperation, Pakistan is paving the way for an eCommerce-powered economic transformation. The Astana CAREC Program underscored that Pakistan’s digital landscape has immense potential. With the right focus on infrastructure, sustainability, and cross-border collaboration, the country’s eCommerce sector can contribute significantly to regional growth.