Digitization can indeed play a significant role in boosting Pakistan's economy. According to a report by the World Bank, digitization could add $60 billion to Pakistan's economy in 7-8 years.
The report suggests that by promoting digital financial services and expanding internet access, Pakistan could benefit from the following:
• Increased financial inclusion: Digitization can help more people access financial services, such as bank accounts, loans, and insurance, which can lead to increased economic activity.
• Improved efficiency and productivity: Digitization can help businesses streamline their operations, reduce costs, and increase productivity.
• Expanded e-commerce: Digitization can help facilitate online transactions, which can lead to increased trade and economic activity.
• Job creation: Digitization can create new jobs in the technology sector, as well as in industries that benefit from increased efficiency and productivity.
However, it is important to note that achieving these benefits will require significant investment in digital infrastructure, as well as policies and regulations that promote the growth of the digital economy. Additionally, there will be a need for increased digital literacy and skills development to ensure that individuals and businesses can fully participate in the digital economy.
Overseas Investors Chamber of Commerce and Industry’s (OICCI) Managing Committee presented the Digital Report 2022, titled, “Recommendations for Digital Transformation in Pakistan” to the President of Pakistan, with the objective to set the country on its digital journey. The report covers suggestions on e-commerce, fintech, IT exports, Web 3.0 technologies, etc.
The OICCI report offers key recommendations to the policymakers on the various facets of the digital transformation of the economy including suggestions for digital infrastructure and connectivity, government, private sector, mass digital usage, emerging web 3.0 technologies, and digital regulations to accelerate innovation in Pakistan. According to a research report, a 10 percent increase in broadband penetration results in increasing the GDP by 1.4 percent.
Ghias Khan, President of OICCI, emphasized, “Digitization can also help inclusion of the underserved population of society such as the far-flung areas of the country. Around 23 million children in Pakistan are out of school and we have less than 1 physician for 1000 people. To help Pakistan overcome these issues”, Ghias added, “it is important to digitize the education and health sectors in a phased manner, preparing National electronic health records, and arranging capacity-building workshops for the professionals”.
The report notes that in recent years, there has been tremendous development in Digital Financial Services. However, Pakistan is still a cash-based economy with less than 5 percent of merchants accepting digital payments. Besides promoting a digital mode of payment, the government also needs to encourage international e-commerce companies to set up regional offices in Pakistan. Indonesia worked on similar lines and now the e-commerce market size is worth $30 billion which is expected to reach $54 billion by 2025 and supports 26 million jobs directly and indirectly.
M. Abdul Aleem, CE, and Secretary General OICCI added, “Digitization can bring a lot of efficiency to government services, boost productivity and help improve ease of doing business (EODB). The Philippines can be a good example where public service delivery was digitized under the E-Government Master Plan (EGMP) which helped the country rank 95th position in the EODB 2020 rating, registering an improvement of 29 notches”.
He added that the government should continue to take advantage of modern technologies such as Machine Learning, Data Analytics, and Artificial Intelligence to improve competence in public departments, document the economy and increase tax revenues.