Microsoft has shut down its operations in Pakistan, ending a 25-year presence that began in March 2000. While the tech giant has not released an official statement, the move was confirmed by Jawwad Rehman, the executive who first launched Microsoft’s presence in the country. Rehman announced the closure via a LinkedIn post, calling it the end of an era in Pakistan’s digital development.
Though the company has remained silent on the reasons, the closure is widely believed to be linked to Pakistan’s ongoing economic instability and political uncertainty. The country has experienced frequent regime changes, worsening macroeconomic conditions, and policy unpredictability—all of which have eroded confidence among global investors and multinationals.
A major factor cited by analysts is the growing difficulty for tech companies to operate in Pakistan due to currency devaluation, high taxation, and import restrictions on hardware and software. These hurdles have made it increasingly difficult for international firms to maintain profitable operations in the region.
Pakistan’s economic challenges have intensified in recent years. By the end of fiscal year 2024, the trade deficit reached USD 24.4 billion, and foreign exchange reserves dropped to USD 11.5 billion as of June 2025. This financial strain has further limited the government’s ability to support the tech sector and attract foreign investment.
Microsoft’s exit is a significant blow to Pakistan’s IT landscape, highlighting the broader trend of multinational companies re-evaluating their presence in economically and politically volatile markets.
