Written by Zainab Iqbal
AI Is No Longer Optional
Artificial Intelligence (AI) is rapidly changing how businesses operate, compete, and grow. The question is no longer whether AI will shape the future of entrepreneurship, but whether Pakistan is prepared to build its own AI-driven solutions or rely on technologies developed elsewhere. This article examines the country’s current AI landscape, identifies key sectors where AI can address real development challenges, and assesses the readiness of Pakistan’s start-up ecosystem to support AI-driven innovation. It also highlights the policy and institutional steps needed to build a competitive, AI-ready entrepreneurial environment.
Artificial Intelligence has moved from being a futuristic concept to an everyday business necessity. Globally, AI is transforming how companies produce, distribute and market products. AI is expected to contribute USD 15.7 trillion to the global economy by 2030, [1]making it one of the most significant economic drivers of this decade.
For emerging economies like Pakistan, this shift presents both urgency and opportunity. AI adoption is no longer about keeping pace with global trends; it is about ensuring economic relevance. Without adopting AI, countries risk becoming dependent on foreign technology instead of developing their own innovations, limiting their ability to create domestic industries, skilled jobs, and technological leadership.
The Current State of AI in Pakistan
Pakistan’s AI ecosystem is still at an early, but promising stage. The country has a growing pool of software engineers, data scientists, and freelancers, supported by a strong IT exports sector. Pakistan’s IT and IT-enabled services export crossed USD 2.2 billion in the first half of the current fiscal year 25/26 [2] showing consistent annual growth. While not all this growth is AI-driven, it provides a foundation upon which AI-based enterprises can be built. Universities such as NUST, FAST, and LUMS have introduced AI, data science, and machine learning programs, and several start-ups are applying AI in fintech, healthtech, and e-commerce verticals.
Investing in AI education is a beginning, however, most AI efforts focus on using and adapting existing tools rather than developing new, original systems and this has consequences to how Pakistan is ultimately participating in the global AI ecosystem. A large share of AI models today are trained on predominantly Western datasets, meaning the languages, contexts, and realities of the Global South are often underrepresented. This can lead to systems that are biased or less effective in local settings. To address this, Pakistan needs to invest in building local data ecosystems and data lakes that reflect its own population and needs. Countries like India and Bangladesh have already begun taking steps in this direction by developing national data initiatives to support AI innovation, offering useful models for Pakistan to follow.
How is Pakistan’s Start-up Ecosystem engaging with AI?
Pakistan’s start-up ecosystem has matured significantly over the past decade, with incubators, accelerators, and venture funds now at a position to be contributing towards growth. However, readiness for AI-driven entrepreneurship remains uneven. While the number of incubators and Business Incubation Centres (BICs) has grown, most continue to focus on general entrepreneurship support, such as pitch-preparation, business development, and fundraising, rather than advanced technical capabilities. As a result, access to critical AI enablers, including high-performance computing infrastructure, GPUs, cloud computing credits, proprietary datasets, and AI-specialized mentors, remains limited for early-stage founders.
At the same time, the global AI landscape is rapidly shifting toward more advanced systems such as agentic AI, tools that can take actions and complete tasks autonomously rather than simply generate responses. Companies like Microsoft are leading this shift by integrating AI “copilots” across products and enabling businesses to build custom AI agents, signaling a move from assistance to automation and even generation.[3]
Encouragingly, Pakistani founders are beginning to engage with these frontiers. For example, Pakistani-born Asad, who founded LTV.ai at 19 to provide AI-driven customer communication for e-commerce brands, raising seven figures in venture funding from firms like Protagonist and OVO Fund. Sualeh Asif from Karachi co-founded an AI coding startup as Chief Product Officer, now reportedly valued for a potential $60 billion SpaceX acquisition, making him Pakistan’s 4th richest entrepreneur. The Pakistani duo Saad Jangda and Hamza Jawaid built Bazaar Technologies, an AI-powered grocery e-commerce platform in Karachi that was acquired by Canva to strengthen its AI creative suite capabilities. Kashif Ali founded TaxGPT, an AI automation startup for tax and accounting that raised $4.6 million this year. Together, these founders demonstrate Pakistan’s growing capacity to build globally competitive AI companies across e-commerce, coding, fintech, and creative technology.
Such examples show that while ecosystem support may still be catching up, Pakistani entrepreneurs are already building globally relevant AI solutions—an advantage that can be further leveraged through stronger infrastructure, funding, and institutional support, while also fostering wider spillover effects, greater handholding from seasoned entrepreneurs, and targeted public-backed institutional and governance support to scale impact across the broader tech ecosystem.
The Cost of Delayed AI Adoption
One of the most common concerns surrounding AI is job displacement. In Pakistan, where employment generation is a major development concern, these fears are valid. However, technological change historically reshapes jobs rather than eliminating them entirely. AI creates demand for new roles such as data analysts, AI trainers, product managers, and domain specialists. The real risk for Pakistan lies not in AI adoption, but in delayed adoption, which leaves workers unprepared for global labor market shifts. For entrepreneurs, this delay also means a limited pool of locally trained talent with the skills needed to build and scale AI-driven solutions, making it harder to innovate and compete. It can force start-ups to rely on external tools or expertise, reducing their ability to create high-value, original products. At the same time, delayed adoption represents a missed opportunity to use AI as a tool for solving local challenges. Without early experimentation and investment, entrepreneurs are less likely to develop solutions tailored to Pakistan’s needs, reinforcing dependence on imported technologies instead of building local innovation. Urgent reworking of Pakistan’s educational systems is critical to address this skills gap, including emphasizing the role of vocational education institutes like PSDF and TEVTA to upskill workers who lack formal education, ensuring a broader labour force can transition into AI-relevant roles and contribute to the country’s innovation ecosystem.
Where Can AI Solve Pakistan’s Real Problems? Focus Areas for Upcoming Founders
Agriculture: From Guesswork to Precision
Agriculture in Pakistan has traditionally relied on experience and seasonal patterns, making it vulnerable to climate variability and crop disease. AI is changing this by enabling data-driven, real-time decision-making. For example, computer vision tools can analyse images of crops (taken via smartphones or drones) to detect early signs of disease that may not be visible to the human eye. This allows farmers to intervene earlier, reducing crop loss.
Similarly, AI-powered weather and soil analytics combine satellite data with local conditions to recommend when to irrigate, fertilise, or harvest, rather than relying on fixed schedules. In countries like Vietnam and India, such systems are already helping small farmers increase yields while reducing input costs by optimizing water and fertilizer use[4]. For Pakistan, where resources are limited and climate risks are rising, this shift from reactive to predictive farming could significantly improve productivity.
Financial Access: Rethinking Creditworthiness
A major barrier to financial inclusion in Pakistan is the lack of formal credit histories. Traditional banks rely on documented income and collateral, excluding a large portion of the population. AI changes this by introducing alternative credit scoring models.
Instead of relying solely on bank records, AI systems analyse patterns in mobile phone usage, digital transactions, bill payments, and even spending behaviour to assess creditworthiness. This allows fintech companies to evaluate risk for individuals and small businesses who would otherwise be invisible to the formal financial system.
In practice, this means a small shop owner or freelancer, without formal documentation can access loans based on behavioural data. Similar models have already been successfully deployed in countries like Kenya and India, significantly expanding access to credit. For Pakistan, this represents a shift from exclusion to inclusion, powered by data that already exists but has not traditionally been used.
Turning AI into an Advantage for Pakistan
These examples highlight that AI’s real value lies not in abstract potential, but in solving problems differently, by making decisions more precise, predictive, and accessible. However, scaling such solutions requires the right ecosystem. Pakistan must invest in AI skills and applied research, enable access to local datasets, and upgrade incubators to support technically complex ventures. Public–private data partnerships will be critical to ensure that start-ups can build solutions grounded in local realities.
With the right support, AI can help Pakistan move beyond incremental improvements and unlock entirely new ways of addressing long-standing challenges, turning structural constraints into opportunities for innovation
Rules, Ethics, and Trust in AI
As AI increasingly shapes decisions in finance, healthcare, education, and governance, clear rules and ethical safeguards are essential to build public trust and enable responsible innovation. Issues such as data privacy, algorithmic bias, transparency, and accountability directly affect adoption and investment decisions.
Pakistan’s proposed Regulation of Artificial Intelligence Act, 2024 introduces several key components. It establishes a National Artificial Intelligence Commission to oversee regulation, mandates human oversight in critical decision-making, and emphasizes transparency and accountability in how data is collected, stored, and used. It also focuses on equitable access to AI technologies and aims to strengthen data governance, cybersecurity, and public service delivery through AI. These provisions signal an intent to balance innovation with safeguards, particularly by ensuring that AI supports, rather than replacing human judgment.
However, what makes Pakistan’s position distinct in the global AI ethics and security debate is its development context. While advanced economies are focused on regulating frontier AI risks, Pakistan must simultaneously address more foundational issues, such as limited local datasets, underrepresentation of regional languages, and dependence on foreign-trained AI models. This creates a risk of systems that are biased, less accurate, or misaligned with local needs.
For Pakistani lawmakers, this means prioritizing a different set of concerns. Beyond high-level principles, there is a need to enable the creation of local data ecosystems, ensure safe and practical data-sharing frameworks for start-ups, and enforce transparency in AI-driven decisions, particularly in areas like lending, public services, and healthcare. Equally important is building institutional capacity to implement these rules, rather than leaving them as policy statements.
Ultimately, Pakistan’s challenge is not just to regulate AI, but to do so in a way that supports local innovation while addressing its own structural constraints, ensuring that AI systems are not only safe and ethical, but also relevant and inclusive for its population.
Conclusion: Building an AI-Ready Entrepreneurial Ecosystem
AI is no longer optional, it is reshaping how economies grow, compete, and innovate. For Pakistan, the real opportunity lies not just in following global trends, but in using AI to solve local challenges and strengthen its entrepreneurial ecosystem. Success will depend on how effectively entrepreneurs, institutions, and policymakers invest in skills, infrastructure, and responsible innovation today. With the right approach, Pakistan can move beyond relying on imported technologies to building its own solutions, creating jobs, expanding opportunity, and building a more competitive and resilient economy for the future.
[4] NEWS WIRE. “AI-Driven Farming Crucial for Pakistan’s Climate Resilience, Food Security: Experts.” The Nation, May 2, 2025. https://www.nation.com.pk/02-May-2025/ai-driven-farming-crucial-for-pakistan-s-climate-resilience-food-security-experts.
[3] “12 Companies Driving the Agentic AI Revolution.” Medium, November 25, 2025. https://medium.com/@vito.rallo/12-companies-driving-the-agentic-ai-revolution-a427d1cb572f.
[2] Business Recorder. “Pakistan’s IT Exports Cross $2.2 Billion Mark in 1HFY26, Freelancers Add Momentum.” January 20, 2026. https://www.brecorder.com/news/40403100/pakistans-it-.
[1] PricewaterhouseCoopers. “The Potential Impact of AI in the Middle East.” PwC, n.d. https://www.pwc.com/m1/en/publications/potential-impact-artificial-intelligence-middle-east.html.


