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Written By: Ms. Mahnoor Gul, a Participant of ICSF-UoS Fellowship Program 2025-26 at University of Sargodha<\/p>\n
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In the cranes and corners of CPEC lies the Digital Silk Road (DSR), an extension of the Belt and Road Initiative (BRI) project, commenced by China in 2015. This tech-focused initiative aims to digitalize the global infrastructure with the help of Chinese technology, encompassing data centers, e-commerce, fiber optics, 5-G networks, satellites, and smart cities. The aim is to promote the online trade among the BRI countries. Cross-Border E-Commerce is playing a crucial role in serving this cause, which is the online buying and selling of goods or services across countries, bypassing the interference of middlemen.<\/p>\n
Cross-border E-commerce is taking an upward turn in growth. China\u2019s e-commerce figures are increasing rapidly with each passing year. China’s cross-border trade in 2025 showed strong growth, with total goods trade hitting around $5.75 trillion by November. The major contributor to this growth is all the initiatives taken under DSR. By 2024, the total export and import volume of cross-border e-commerce had reached 2.63 trillion yuan (about US$363 billion), double the total volume of 2019. The SDR framework covers 30% of the entire transaction. Major Chinese companies, including AliExpress, Shein, and Temu, accounted for 40 percent of global cross-border online orders in 2023 (Alex He, 2025).<\/p>\n
Only by investing in high-speed internet connectivity can Pakistan engender opportunities for the youth and promote inclusive growth. Rather than being a mere technological project, DSR is a socioeconomic strategy designed to distribute the benefits of digital transformation equitably. High-speed internet is the backbone of DSR, allowing for every sector to flourish. The expansion of E-commerce in Pakistan allows the domestic producer to compete with foreign goods in the international market. Pakistan\u2019s foreign investment would have ascended if there were data centers within the country, by providing local producers with the tools that help them to innovate and expand their businesses.<\/p>\n
Economics Insight<\/p>\n
Trade was mainly about transaction costs, including the costs of search, market access, and contract dealings. Only large firms were able to benefit, as small firm owners lack access to international sellers. Digital platforms eliminated all these costs. Now, a small seller can reach foreign consumers without warehouses, intermediaries, or physical presence. This aligns exactly with the Coase theorem, which states that when transaction costs reduce, the market expands, and boundaries shrink. DRS supports this by investing in fiber optics, payment systems, and logistic networks, which reduces the fixed cost and unreliability in international exchange.<\/p>\n
From a development perspective, Scales of Economies come into play. Platforms with increasing economies of scale, attracts more buyers, the more valuable they become, leading to concentration of the market. Early movers get greater benefit; having a large user base allows them to reduce costs further and improve services. For developing countries, competitiveness alone will not shape integration with the digital system, but also alignment with dominant platforms.<\/p>\n
Opportunities for Pakistan\u2013China Trade Integration<\/p>\n
An 820km Fiber-Optic cable that goes from Khunjerab pass to Rawalpindi, reducing the reliance on undersea cables that require access from many countries. This high-capacity connection, through diverse routes, improves Cybersecurity. Additionally, keeping Pakistan from unnecessary outages from cable damages undersea.<\/p>\n
An uninterrupted digital payment system is the foremost thing in an online system in many countries. By collaborating with fintech companies of China, new doors of growth open as, Pakistanis business can directly access the Chinese consumers easily. Rasst is an example, which was created with the collaboration of Bill Gates and Melinda Gates.<\/p>\n
The whole world operates on data; in this scenario, it is the need of the hour to store the private and sensitive data cautiously. Chinese firms in partnership with Pakistan are investing in tier-2 and tier-3 data centers in Karachi, Lahore, and Islamabad. These data warehouses become the basis for Artificial Intelligence and Cloud Computing. It provides a secure environment for public services and administration.<\/p>\n
The Digital Silk Road is not confined to a land network. Pakistan and China are putting efforts jointly to launch satellites and other services related to space under the umbrella of CPEC. These include communication expansion steps to expand broadband coverage to hilly areas. These advanced technologies can assist Pakistan in many ways. For example, Pakistan is facing huge losses every year due to climate vulnerabilities, leading to floods, earthquakes, storms, and droughts. Enhancing data integration through these bilateral projects develops the adaptability required in per-disaster preparedness and post disaster recovery.<\/p>\n
Digital trade helps in economic diversification. The e-commerce market of Pakistan reached a value of $10.42 billion in 2025 and is expected to rise in the coming years (Hajra Naz, 2025). The IT sector has emerged greatly, with Pakistani freelancers as software developers providing services in the global gig economy.<\/p>\n
Technology is only effective when the operator knows how to use it. Vocational training centers are emerging in Pakistan for the provision of digital literacy under CPEC\u2019s education cooperation agreement, as DRS\u2019s success is dependent on skill development. Various educational institutes are collaborating with China for advanced digital technological studies courses. For example, in July, the University of Sargodha (UoS) signed a Memorandum of Understanding (MoU) with Zaozhuang School of Technology to enhance tech cooperation by envisioning the establishment of a Lithium Battery Manufacturing Unit in Pakistan. Later in November, UoS opened its first Pakistani university campus in China. These initiatives are exemplary for creating and strengthening human capital.<\/p>\n
The Gordian Knots of Digital Transformation for Pakistan:<\/p>\n
Pakistan continuously faces challenges in its regulatory framework. The flawed laws and red tape are a consistent threat to making new policies that support innovation and competition. Clear guidelines for data sharing, investing, and digital trading are necessary for success.<\/p>\n
Privacy concerns are another setback that needs to be addressed. With more digital transformations, there arises the need to protect the private data of individuals. In this case scenario, strict Cybersecurity compliance is required to secure sensitive data.<\/p>\n
Moreover, there is a need to bridge the gap between the rural and the urban population to maximize the efficient outcomes.<\/p>\n
Lastly, the issue of Debt sustainability, Pakistan is facing difficulties to service its loans, leading to a debt trap scenario that poses a threat to long-term fiscal stability. For example, direct loan repayments related to CPEC are estimated at US$5.8 billion, to be paid off by 2035(S. Sharif, 2023).<\/p>\n
Mapping Pakistan\u2019s Place in the Digital Silk Road:<\/p>\n
DRS is providing Pakistan with a transformative opportunity to reposition itself according to the expanding horizons in the technological world. Embedded under CPEC, DRS can expand market access to small and medium enterprises and promote inclusive growth. From fiber cables across the mountains of Gilgit to the ports of Gwadar, the advanced data centers in Lahore and Karachi, and increased efforts towards skill building, provide a chance to overcome the traditional limitations.<\/p>\n
The task for Pakistan is not just adopting the technology but to align it with economic policies, fiscal framework, and skill development. DRS can evolve from connectivity to a comprehensive development strategy if Pakistan can address its challenges properly. However, technology alone does not guarantee success and growth. The question is how well Pakistan can integrate digital change into economic growth, stronger institutions, and elevate standards of living. It must not work only for the betterment of specific class of people, but opportunities must be provided for ordinary citizens and entrepreneurs. If supported by fair policies, strict regulations combined with digital skills can act as a stimulus for reducing inequality in Pakistan.<\/p>\n
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Written By: Ms. Mahnoor Gul, a Participant of ICSF-UoS Fellowship Program 2025-26 at University of Sargodha In the cranes and corners of CPEC lies the Digital Silk Road (DSR), an extension of the Belt and Road Initiative (BRI) project, commenced by China in 2015. This tech-focused initiative aims to digitalize the global infrastructure with […]<\/p>\n","protected":false},"author":8,"featured_media":58513,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[73,33,35],"tags":[],"class_list":["post-58511","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-english-news","category-national-news","category-pakistan"],"_links":{"self":[{"href":"https:\/\/www.dailybigdigit.com\/index.php?rest_route=\/wp\/v2\/posts\/58511","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.dailybigdigit.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.dailybigdigit.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.dailybigdigit.com\/index.php?rest_route=\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.dailybigdigit.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=58511"}],"version-history":[{"count":0,"href":"https:\/\/www.dailybigdigit.com\/index.php?rest_route=\/wp\/v2\/posts\/58511\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.dailybigdigit.com\/index.php?rest_route=\/wp\/v2\/media\/58513"}],"wp:attachment":[{"href":"https:\/\/www.dailybigdigit.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=58511"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.dailybigdigit.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=58511"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.dailybigdigit.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=58511"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}