Pakistan’s data centre industry is experiencing rapid growth, offering strong potential to provide high-speed connectivity and data colocation services to Central Asian countries, which could support their digital transformation and economic development. However, experts warn that significant challenges, particularly from government institutions, could hinder the sector’s expansion.
Muneeb Khawaja, Business Unit Head of Data Centres at DWP Group, shared insights with journalists on Monday about the fast-evolving cloud industry in Pakistan, with major telecom providers increasing their presence in the sector. He explained that the country’s burgeoning data centre industry could benefit Central Asia by providing essential services that support digital advancement.
However, Khawaja pointed out that direct competition from government institutions poses a serious challenge. He explained that these institutions often receive relaxations in the bidding process, which makes it difficult for private-sector players to compete effectively. This could result in stifled investment in the growing sector, despite its potential. According to Khawaja, a single data centre consumes 15-20 megawatts of power, represents nearly $100 million in investment, and creates high-end technical jobs.
Khawaja stressed that the government should focus on supporting data centre development with enabling policies, instead of competing directly with private enterprises. This approach, he noted, could create a win-win situation, with more investment leading to job creation and overall economic growth.
The government’s focus on digital transformation and the growing potential for public-private partnerships could help overcome these challenges, according to Khawaja. Regulatory support and investment in sustainable infrastructure are key to addressing the sector’s current limitations. He also mentioned that while international collaborations are encouraging, a national push toward green data centres would require robust policy backing, infrastructure upgrades, and technology transfer.
For optimal efficiency, Khawaja suggested that data centres be located in northern Pakistan, where the cooler climate reduces cooling costs. He highlighted regions such as Gilgit-Baltistan as ideal locations, but also emphasized the need to consider potential risks such as floods, earthquakes, and the availability of internet connectivity, energy, and skilled labour.
With the surging global demand for data centres driven by digitalization, Khawaja highlighted the importance of secure data storage and the role data centres play in this process. He noted that DWP recently established two data centres in collaboration with the Higher Education Commission (HEC) in Karachi and Lahore. These facilities are designed to meet HEC’s data storage needs and support academic research and development. The projects are scalable to meet the future demands of the sector.
However, many existing data centres in Pakistan still rely on traditional power sources and outdated cooling systems. While some newer projects aim to incorporate renewable energy, Khawaja noted that many legacy centres are lagging behind in the green transformation. Data centres consume large amounts of energy, with energy costs being the largest operational expense.
To address this, Khawaja emphasized that DWP’s newly designed data centres focus on energy efficiency. He proposed solar energy as a viable option, noting that regions like Sindh and Balochistan, with strong wind corridors, offer promising opportunities for wind power integration. Khawaja also pointed out that Pakistan’s renewable energy potential exceeds 60,000 MW, and that using on-site solar panels and long-term power purchase agreements (PPAs) with wind farms could significantly reduce operational costs and carbon emissions.
Finally, Khawaja stressed the importance of developing a skilled workforce to manage data centres. He mentioned the company’s collaboration with academic institutions, such as Knowledge Stream, to train future data centre specialists, ensuring a steady supply of skilled professionals for the industry.
