- Internet connectivity and strategic partnerships propel growth
Today the world stands on the brink of a technological revolution that will totally transform the way human beings interact with one another and organise their lives – be it jobs, education or day-to-day routine activities. Machines and people are increasingly being connected through the internet and are communicating at a speed unknown to mankind before. As the world’s top exporter, statistics showed that China is the world’s top e-commerce market, with total online sales in 2023 exceeding the $3 trillion mark. Together with the United States, e-commerce sales from these two countries totaled more than $4.1 trillion. It should come as no surprise then, that some of the world’s top e-commerce companies come from these two powerhouses. In fact, greater than half of the top 10 hail from either China or the US.
| Year | Global e-commerce sales (expected) |
|---|---|
| 2021 | $4.98 trillion |
| 2022 | $5.29 trillion |
| 2023 | $5.82 trillion |
| 2024 | $6.33 trillion |
| 2025 | $6.86 trillion |
| 2026 | $7.41 trillion |
| 2027 | $7.96 trillion |
E-commerce in Pakistan is enlarging rapidly, and it is becoming a major trend among the people who utilise the internet. Because of proficiency of authentic websites or portals the trend is increasing where the sale and purchase are good. Furthermore for increasing e-commerce in Pakistan, the speedy-internet connectivity and availability is also one of the biggest factors. As it is now becoming a major contributor to the economy of Pakistan. One of the major winners from Covid-19 worldwide had been e-commerce companies in our country. Based on the statistics published by the State Bank of Pakistan (SBP), the number of registered e-commerce merchants in Pakistan increased from 1,707 in 2019-20, to 3,003 in 2020-21, a 76 per cent increase. Pakistan was the 37th largest market for E-commerce with revenue of USD 5.9 billion in 2021, placing it ahead of Iran and behind Israel. With a rise of 45 percent, the Pakistani E-commerce market in 2021 contributed to the worldwide growth rate of 15 percent.
In Pakistan according to the experts, the e-commerce market is expected to grow by 13.10% on annual basis to reach US$14.1 billion in 2024. Medium to long-term growth report of e-commerce industry in Pakistan promises to be attractive. The e-commerce is expected to grow steadily over the forecast period, recording a CAGR of 9.46 per cent during 2024-28. The e-commerce Gross Merchandise Value in the country will grow from US$12.5 billion in 2023 to reach US$20.2 billion by 2028. In 2023 it was expected that it would grow by 15.36 per cent on annual basis to reach US$12.5 billion and recording a CAGR of 10.70 per cent during 2023-2027.
Presently, the Government of Pakistan introduced its merchandise pavilion on the popular Chinese social media platform Douyin at the Global Hub in Shanghai Waigaoqiao Free Trade Zone, marking a milestone in boosting e-commerce ties with China. The two countries it was recorded that in November 2022, signed a Memorandum of Understanding (MoU) on e-commerce cooperation, officially entering into Silk Road E-commerce partnership.
According to Gwadar Pro, the MoU aims to foster cooperation in areas such as e-commerce policy, trade facilitation and cross-border e-commerce. Including traditional handicrafts, textiles, jewellery and other specialties, the Pakistan Merchandise Pavilion on Douyin will feature a wide range of Pakistani products. Enhancing their shopping experience and fostering a deeper understanding of Pakistan’s rich culture and trade traditions, Chinese consumers will have direct access to authentic Pakistani products. It is said that the platform has provided service and promotional facilitation for the Pakistan Merchandise Pavilion, enabling it to attract attention and participation through engaging content and authentic marketing campaigns. No doubt, a number of government departments have started to offer services via internet. In the private sector, four Pakistani airlines now offer e-ticketing and almost all local banks offer online banking services. In addition, last year, the State Bank of Pakistan (SBP) issued No-Objection Certificates to five applicants for initiating digital banking services. This segment of the economy is expected to grow steadily as there are nearly 87.4 million internet subscribers in Pakistan, a figure that is expected to grow significantly over the next five years.
In Pakistan there are also greater than 7.3 million Facebook users and several local companies now use social media to promote their products and services. The number of 3G and 4G users in Pakistan increased from 126.24 million by the end of November to 127.68 million by the end of December 2023. On Pakistani holidays and event seasons like Eid-ul-Fitr, Eid-ul-Azha, Black Friday, New Year etc, e-commerce entrepreneurs enjoy heavy traffic. Major sporting events can also drive purchases of related equipment and merchandise. The introduction of mobile broadband coupled with affordable smartphones has driven social media use and the popularity of Facebook, Skype, Twitter and Instagram. Facebook in Pakistan leads social media with greater than 3.0 billion connections per day and more than 43.7 million user accounts. Moreover, Twitter is also fast becoming the preferred social media portal with more than 280 million connections per day. YouTube, Google and Instagram are also popular in our country. No doubt, the e-commerce sector has focused chiefly on consumer accessories and products. Online customers search for and purchase consumer electronics, make employment queries, receive online education and counseling services, sell/purchase and gather information on vehicles, food and groceries, computers, financial and countless other products and services in Pakistan. Consumer choices and the records they generate also produce a trove of data that is used in targeted advertising.