2024 was a year marked by repeated internet disruptions in Pakistan, which strained the economy and exposed the country’s digital vulnerabilities. From politically motivated shutdowns to technical and experimental surveillance infrastructure, internet access became unstable for millions of users dependent on reliable connectivity.

The disruptions took multiple forms. The Government of Pakistan suspended internet and mobile phone services during the General Elections (8th February 2024). On February 17th 2024 (soon after the General Elections), the authorities restricted access to X (formerly Twitter), citing national security concerns and the need to maintain public order. The ban on X remained in place for over a year till May 2025.

Then in August 2024, a malfunction in two of Pakistan’s seven international submarine cables, AAE-1 and SMW4, slowed connectivity across the country. Around the same time, the Government also conducted trial runs of a national firewall in July and August 2024, which further aggravated the internet disruptions and raised concerns about censorship and economic impact. Additional shutdowns in Punjab, Sindh and KPK in November 2024, just ahead of the planned protests by the Pakistan Tehreek-e-Insaaf (PTI) party, brought regional access to a halt. By December 2024, users nationwide reported slow internet speeds and difficulties in uploading and downloading of media such as images, videos and voice notes via apps like WhatsApp, Facebook, Instagram and TikTok.

This blog post explores the economic consequences of the internet disruptions in Pakistan, particularly on the digital economy. It also critiques the Government’s existing measures and suggests alternative long-term measures to protect the digital economy from disruptions.

The digital economy under strain

Due to these persistent internet disruptions, Pakistan’s economy faced severe setbacks in 2024, with implications extending beyond immediate financial losses. The global cost of intentional internet disruptions was $7.69 billion of which Pakistan bore a sizable 21%. A report by Top10VPN revealed that Pakistan endured the world’s highest economic losses from internet outages, amounting to $1.62 billion. This figure exceeds the losses in conflict-ridden countries such as Sudan and Myanmar. These disruptions, spanning approximately 9,735 hours, affected nearly 82.9 million users, coinciding largely with political events, elections, and protests – a pattern that highlights the intersection of digital access and governance.

The IT sector was among the most severely affected industries. According to the Pakistan Software Houses Association (P@SHA), the sector faced potential annual financial losses of up to $150 million, primarily due to slow internet speeds and restrictions on Virtual Private Networks (VPNs). In an interview with media representatives, Sajjad Mustafa Syed, Chairman of P@SHA (Pakistan’s IT industry association), emphasized that each hour of internet shutdown could translate into losses exceeding one million dollars, highlighting the fragility of Pakistan’s digital infrastructure. He also quoted an example of a call centre, which had to bear a huge loss of $2 million due to the internet disruptions. According to Zohaib Khan, a former P@SHA chairman, reports of internet shutdowns in Pakistan are harming the country’s reputation in the international market, which is indirectly affecting the IT sector.

Pakistan has a sizable number of around 2.37 million freelancers, who are an integral part of Pakistan’s digital economy (with Pakistan boasting the fourth largest freelancing market in the world). According to a study by Ignite – National Technology Fund, at least a quarter of the total freelancers in Pakistan are full-time freelancers who do not have any other source of income. The local freelancers reported a 70% drop in work opportunities because of unreliable internet speeds. Shahzaib Mustafa from Okara has been working as a freelancer on Fiverr (a multinational online marketplace for freelancing services) for the past six years. During that time, he earned at least $10,000. However, the slow and unstable internet connectivity over the last year prevented him from securing new projects and hindered his ability to meet deadlines due to which he lost some of his long-term clients.

Despite these challenges, IT-related exports reached $3.2 billion (8.3% of the total exports) in the FY 2023-24. However, if internet disruptions persist like last year then the government will never achieve its own $15 billion IT exports target set in 2024 for the next five years.

Government responses and infrastructure efforts

Recognizing these challenges, industry leaders and IT experts have called for accelerated 5G deployment and infrastructure improvements to boost connectivity. Key recommendations include the fiber-optic expansion of cell towers and the installation of additional undersea cables to enhance bandwidth and reliability. On this front, the government’s National Fiberization Policy, introduced in November 2024, is a promising step. This Policy seeks to broaden broadband access and improve internet speeds by laying down an extensive network of fiber optic cables, a move that could benefit both freelancers and tech enterprises alike. However, its implementation has been slow and prioritizing this work would be highly beneficial for the country.

Further, the Pakistan Telecommunications Authority (PTA) has announced plans to enhance internet speed and connectivity by integrating with the 2Africa submarine cable system. Spanning 45,000 kilometers and connecting 46 locations across Africa, Europe, and the Middle East, the 2Africa cable is among the world’s largest, offering speeds of up to 180 Tbps – a significant boost for Pakistan’s digital landscape. (In recent news: PTCL also linked to the Africa-1 Submarine Cable which will improve connectivity in Pakistan by 2026.)

Further actions that the government should take

Pakistan’s digital economy stands at a critical juncture. The significant $1.62 billion economic loss incurred in 2024 due to internet disruptions draws attention to the urgent need for policy reforms. Frequent internet outages and slow connectivity have not only impacted IT exports but also undermined the country’s potential as a global digital player.

To reverse this trend, the government must prioritize uninterrupted internet access. As stressed earlier, with over 82.9 million users affected by prolonged connectivity issues, ensuring stable digital infrastructure is fundamental to promoting economic growth. Reevaluating restrictive policies, such as VPN regulations and content firewalls, is equally essential, as businesses and freelancers continue to face operational hurdles due to government-imposed restrictions.

Investment in digital infrastructure must be expedited. Additionally, Pakistan’s integration into the 2Africa submarine cable system presents an opportunity to enhance global connectivity and improve network resilience.

Creating an enabling environment for digital trade and e-commerce is also essential. Rationalizing tax policies, streamlining regulations, and ensuring fair access to digital services will encourage investment in the sector. The Digital Pakistan Policy lays a framework for this transformation, but without decisive action, it risks becoming another unfulfilled promise.

Moreover, strengthening digital literacy and skill development programs is crucial. Initiatives like DigiSkills.pk must be expanded to equip the country’s freelancers with the necessary tools to compete globally. It is essential to incorporate specialized training in Artificial Intelligence (AI), blockchain and cloud computing in DigiSkills.pk to prepare our labor force for high-value digital jobs.

Furthermore, the Government should provide freelancers with subsidized access to coworking spaces in both major cities and underdeveloped areas. These spaces should offer stable internet connections, uninterrupted electricity and professional networking opportunities, to enable freelancers to work efficiently. In addition, the Government can introduce affordable financing schemes for laptops, routers and mobile broadband devices, which can reduce barriers to entry in the freelancing market.

The need for reliable internet extends beyond the IT sector. It is fundamental for economic growth, innovation, and global competitiveness. Without swift and decisive action, Pakistan risks losing its foothold in the global digital economy, deterring investment and stalling growth in an otherwise promising sector. Addressing connectivity issues is no longer optional – it is imperative for Pakistan’s long-term economic sustainability.