AI's Potential Contribution to Pakistan's GDP by 2030

In recent years, the digital economy has emerged as a vital component of global growth, and Pakistan is no exception. With advancements in technology, particularly in artificial intelligence (AI), the country stands on the brink of a significant economic transformation. According to Dr. Sohail Munir, an advisor to the Saudi Data and AI Authority (SDAIA), AI could contribute between $10 billion to $20 billion to Pakistan's GDP by the year 2030. This projection was shared during the AI Convergence Summit Pakistan, highlighting the potential of AI to reshape the economic landscape.

Dr. Munir emphasized that Pakistan's digital economy could reach an impressive $60 billion, with AI driving approximately one-third of this growth. He noted that AI could account for up to 10% of the country's gross domestic product (GDP). These insights are based on a report from PwC, which suggests that nations like Pakistan could experience an overall AI impact of 5.6% on their GDP by 2030. This aligns with a broader global trend, where AI is expected to contribute a staggering $15.7 trillion to the world economy within the same timeframe, surpassing the combined economic output of China and India.

During the summit, Dr. Munir highlighted the transformative effects of digitization and AI, stating that the Pakistani economy could potentially reach a GDP of $600 billion by 2030. This growth is anticipated to be driven by cumulative advancements and the development of Digital Public Infrastructure (DPI). Ahmed Hashim, the CEO of Cygnis, echoed these sentiments, noting that while AI is still in its early stages in Pakistan, its impact is already being felt in the IT sector. He mentioned that around 30% of the country's IT exports are currently AI-based, indicating a growing trend towards integrating AI into various business models.

Furthermore, Muntaqa Peracha, the CEO of foodpanda, shared how the company leverages AI to enhance operational efficiency. By minimizing waiting times for riders picking up orders, foodpanda not only improves rider earnings but also boosts overall service quality. This practical application of AI showcases its potential to solve real-world problems and enhance business performance.

Arsalan Akhtar, president and co-founder of Cygnis, acknowledged the existing low local demand for AI services but pointed out the increasing pressure from the international market. He noted that major IT firms in Pakistan currently have 20% to 30% of AI-based services in their export portfolios, indicating a shift towards more innovative solutions.

During the summit, Habibullah Khan, CEO of Penumbra, shared insights from a recent report involving a client that raised over $100 million in a private equity fund. He highlighted a crucial difference between Pakistani and Indian firms in their approach to AI. While some Pakistani companies focus on providing low-cost services, Indian firms actively engage with customers to understand their specific challenges, such as non-performing loans and onboarding complications. This proactive approach allows Indian companies to develop tailored AI solutions, thereby attracting more customers.

Khan stressed the importance of effectively communicating the benefits of AI to business leaders in Pakistan. He believes that incorporating AI into business models could yield substantial advantages, and failing to do so may result in missed opportunities. As the digital landscape continues to evolve, it is essential for Pakistani businesses to adopt a more solution-oriented approach to AI, ensuring they remain competitive in an increasingly globalized economy.

The potential of AI to significantly boost Pakistan's GDP by 2030 is not just a distant dream but a tangible opportunity that requires immediate attention. As businesses begin to recognize the value of AI and digitization, the country can harness these technologies to drive economic growth, improve efficiency, and ultimately enhance the quality of life for its citizens. The journey towards a robust digital economy is underway, and it is imperative for all stakeholders to collaborate and innovate to fully realize the benefits that AI has to offer.