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Data Centers in Pakistan

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Pakistan – Emerging South Asian Digital Hub

Executive Summary

Pakistan is a strategic market for businesses targeting the massive consumer base in South and Central Asia. Establishing a data center presence here directly addresses latency and data sovereignty needs, improving application performance for a digitally active population. For companies expanding into the region, Pakistan offers a foundational footprint despite its developing infrastructure.

Pakistan: At A Glance

FactorRating / DataNotes
Global Connectivity GradeBReflects developing international links and reliance on key subsea cable systems.
Direct Cloud On-Ramps0 – as of September 2025Nearest hubs are in the UAE and India; private network extensions are required.
Power CostPKR 35.00–45.00/kWh (est.)Prices can vary; grid stability necessitates robust on-site backup power generation.
Disaster RiskHigh (6.4/10) – as of September 2025High exposure to seismic and flood risks mandates careful site selection.
Tax IncentivesYesGeneral income tax exemptions for IT; specific financing support for data centers.
Sales Tax18% GST (Goods); 15–16% (Services) – as of September 2025Service tax rates vary by province.

Network & Connectivity Ecosystem

Carrier Density & Carrier Neutrality Carrier density is developing, with approximately 11 data centers available in the country as of September 2025. Major facilities, particularly in Karachi, offer access to a mix of national and regional network providers. True carrier-neutral facilities are emerging but are not yet the standard across the market.

Direct Cloud On-Ramps As of September 2025, there are no direct public cloud on-ramps within Pakistan, and no cloud providers host a dedicated region in the country. Businesses connect to cloud services via network providers, with the nearest major hubs located in the UAE (Dubai) and India (Mumbai). Private network extensions are the standard for secure, dedicated access.

Internet Exchange Points (IXPs) The primary national exchange is the Pakistan Internet Exchange (PKIX), which facilitates local traffic peering in Karachi, Lahore, and Islamabad. Using PKIX reduces latency for domestic users by keeping local traffic within the country, improving end-user experience.

Bare Metal Bare metal services are available from local colocation providers. For organizations requiring global platforms, it is common to use providers like Hivelocity or Leaseweb from nearby hubs to serve the region with lower latency than more distant locations.

Power Analysis

Average Cost Of Power Industrial power costs are estimated to be in the range of PKR 35.00–45.00/kWh, as of September 2025. This cost structure makes power a significant operational expense that requires careful management and the use of energy-efficient hardware.

Power Grid Reliability The national power grid can experience fluctuations, making robust backup systems essential for data center operations. All credible facilities are equipped with redundant UPS systems and on-site diesel generators to guarantee uptime. The country's energy mix consists mainly of fossil fuels (~66%) and hydropower (~27%), as of September 2025.

Market Access, Business & Tax Climate

Proximity To Key Business Districts Data centers are concentrated in and around Karachi, the nation's financial capital, as well as Lahore and Islamabad. This proximity provides low-latency connectivity to banks, media companies, and the country's growing software development industry.

Regional Market Reach A presence in Pakistan provides direct access to a domestic market of over 230 million people. It also serves as a strategic point for delivering services to neighboring markets like Afghanistan and parts of Central Asia where digital infrastructure is less developed.

Tax Advantage For Data Centers The government offers significant tax incentives to attract technology investment, including broad income tax exemptions for the IT and software sectors. Specific financing support is also available for the development of new data center facilities, reducing the initial capital expenditure for new projects.

Natural Disaster Risk

Pakistan has a High disaster risk profile, with an overall INFORM risk score of 6.4 out of 10, as of September 2025. Site selection is critical, as the country has high exposure to several significant natural hazards.

Key risks for data center planning include:

  • River Flood (9.5/10): Extreme risk in many parts of the country, particularly during monsoon season.
  • Earthquake (9.2/10): High seismic activity, with several major fault lines crossing the country.
  • Tropical Cyclone (7.1/10): A material risk for the southern coastal regions, including the key market of Karachi.
  • Tsunami (6.1/10): A notable risk for coastal infrastructure due to seismic activity in the Arabian Sea.
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