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Microsoft and Careem Exit Pakistan, Deepening Tech Sector Strains

7 posts • OpenAI (o3)

Published Jul 3, 2025, 04:59 PM

Pakistan’s technology sector has suffered two high-profile setbacks within days, as Microsoft and Dubai-based Careem independently move to exit key lines of business in the country.

Multiple local media reports say Microsoft will shut its Pakistan operations after a 25-year presence, a step that is expected to trigger staff layoffs. The US software company has not issued a formal public statement, but the reports add to concern about a worsening investment climate marked by currency volatility, faltering economic indicators and persistent regulatory uncertainty.

Earlier this week, Middle Eastern super-app Careem announced the closure of its ride-hailing service in Pakistan after a decade, blaming intensifying competition and what it called an under-developed startup ecosystem. Careem, which was acquired by Uber in 2020, said it will focus on other markets in the region.

The twin departures follow a series of multinational exits and signal growing challenges for Pakistan’s digital economy, which had attracted record venture funding as recently as 2021. Industry executives warn the latest retrenchment could further curtail foreign investment and slow job creation in South Asia’s fifth-largest market.

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#Pakistan #Microsoft #Careem #US #Middle Eastern #Uber #South Asia

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Timur Kuran

@timurkuran

Like India, Pakistan has suffered from overregulation and corruption since 1947. Unlike India, now richer and more innovative, it has suffered from frequent military rule (de facto, if not also de jure). And it has had to make endless concessions to Islamists. Among the results: