More Pakistani companies than ever before are eyeing Dubai – for good reason

In the first half of 2024, nearly 4,000 Pakistani businesses registered with the Dubai Chamber of Commerce, ranking Pakistan second in new foreign entries. India secured the top spot with 15,481 Indian-owned companies joining the chamber last year, marking a 38 percent year-over-year increase. Egypt followed in third place with 4,837 new members, reflecting a significant 63.2 percent rise compared to the previous year.

This trend reflects the growing appeal of Dubai’s stable, business-friendly environment for companies exploring expansion and continuity in a global marketplace. While challenges at home— such as political shifts, digital infrastructure needs, and rising operational costs— pose obstacles, Dubai’s forward-thinking environment offers solutions that increasingly attract businesses looking to thrive.

This year alone, Pakistan has experienced five separate Internet restrictions, three in February tied to election-related events, and two more in January during virtual gatherings organized by Pakistan’s political parties. Each restriction led to a sharp rise in demand for Virtual Private Networks (VPNs), as many Pakistanis turned to these services to maintain digital access. On May 9, 2023, following the arrest of former Prime Minister Imran Khan, the government blocked platforms like X (formerly Twitter) and other social media sites, triggering another wave of VPN interest. VPN demand surged by 229 percent on December 17 during a similar seven-hour blackout, and demand soared by a remarkable 6,000 percent on January 20 following government-imposed throttling of social media during an online event.

While Pakistan faces challenges, the UAE, Dubai in particular, offers a markedly different environment, especially appealing to AI startups, digital agencies, and roles that operate remotely.

Sara Danial

The importance of digital stability is especially critical for companies operating in Pakistan’s IT-enabled services (ITeS) sector, which is valued at $3.2 billion and ranks fourth in global freelance markets. A reliable digital infrastructure is essential not only for operations but also for facilitating the global outreach and client interactions upon which these businesses depend. For entrepreneurs and digital agencies, the consistency of Dubai’s digital environment provides an attractive and dependable alternative.

The financial landscape for businesses in Pakistan has also shifted, with escalating energy costs placing a heavy strain on operations, particularly in energy-intensive sectors. Between July 2022 and July 2024, the basic tariff per unit of electricity saw multiple increases. A Rs7.91 hike in late 2022, followed by an additional Rs7.50 in July 2023, a surcharge of Rs3.23 per unit, and another Rs7.12 increase in July 2024, has pushed operational costs higher, making it challenging for companies to sustain profitability and growth. Such increases have implications beyond immediate cash flow constraints; they often compel companies to reconsider expansion plans, delay investments, and make cautious, risk-averse decisions that limit their competitive edge.

While Pakistan faces challenges, the UAE, Dubai in particular, offers a markedly different environment, especially appealing to AI startups, digital agencies, and roles that operate remotely. With an open approach to business, Dubai connects globally with cities, governments, and people, creating a bridge for international collaboration. Unlike regions focused on building barriers, the city’s approach fosters connection, innovation, and shared opportunities on the world stage, especially since the announcement of the Dubai Economic Agenda (D33).

Dubai is a focal point for trade, finance, tourism, and innovation, powered by a public-private partnership model where government enables rather than restricts business growth. This model allows Dubai to attract talent, resources, and investments that foster entrepreneurial success across technology and digital sectors. For many digital-first companies and startups, this collaborative environment, paired with flexible regulatory frameworks and pathways to global expansion, is an ideal backdrop for sustainable growth.

The economic environment in Pakistan still grapples with issues related to political and digital instability. These challenges have underscored the need for a structured, supportive business environment. As local enterprises look beyond their borders, Dubai’s promise of continuity, digital resilience, and favorable business policies make it an attractive option for Pakistani entrepreneurs seeking new horizons.

The nearly 4,000 Pakistani businesses that chose Dubai in the first half of this year signal a broader regional shift, as companies navigate complex operational landscapes to find more favorable conditions. The appeal lies not only in its robust infrastructure but in its forward-thinking economic model that prioritizes the success of the businesses that choose to operate there. For Pakistani enterprises and entrepreneurs looking for a foundation of stability and a global platform for growth, it presents a unique opportunity, bridging current needs with future ambitions.

As Pakistan continues its journey of economic and technological advancement, it can look to more favorable regions to invest their money in, and perhaps look at it as a model of what can be achieved through strategic, business-friendly governance. While challenges remain, the potential for future partnerships and mutual growth between the two regions may lead to new avenues for collaboration, innovation, and shared prosperity in the years to come.

– Sara Danial is an independent writer from Karachi.