Microsoft Shuts Down Pakistan Operations After 25 Years Amid Global Layoffs

Islamabad: Tech giant Microsoft has reportedly wound down its operations in Pakistan, bringing an end to over 25 years of liaison presence in the country. The move coincides with Microsoft’s global cost-cutting initiative, which includes laying off over 9,000 employees, as the company shifts toward a leaner, cloud-first business model.

Though Microsoft never maintained a full-scale office in Pakistan, it operated liaison offices focused on enterprise, government, and education sectors. The decision to exit has sparked concern among business leaders and former officials, with many calling it a warning signal for Pakistan’s economic and business climate.

Former President Dr. Arif Alvi expressed regret, stating that Microsoft co-founder Bill Gates had once considered a major investment in Pakistan. However, according to Alvi, political instability and regime change derailed those plans, eventually leading Microsoft to shift its expansion strategy to Vietnam in late 2022.

“Pakistan now spirals in a whirlpool of uncertainty,” Alvi noted in a post on X, lamenting increasing joblessness and the outflow of tech talent.

Voices from the Industry

On LinkedIn, Jawwad Rehman, Microsoft Pakistan’s founding country manager, said the exit was “more than a corporate decision.” He pointed to deteriorating conditions in Pakistan’s economic and innovation environment that made it unsustainable for even global giants to operate.

Habibullah Khan, CEO of design firm Penumbra, also shared that Microsoft’s actual revenue from Pakistan was minimal—about $50 million, or roughly 0.018% of its global income—making the decision unsurprising in the current climate of global layoffs.

“They had already been operating minimally—billing from Ireland, support from Turkey, and relying on local partners,” Khan added.

Strategy Shift, Not Market Exit

Later in the day, Pakistan’s Ministry of IT and Telecom released a statement clarifying that Microsoft is “reviewing the future of its liaison office” as part of a global workforce optimization programme, not entirely pulling out of the Pakistani market.

The ministry emphasized that Microsoft will continue serving Pakistani customers via cloud-based services and local certified partners, aligning with its broader transition to Software-as-a-Service (SaaS) delivery models. Licensing and commercial operations had already been shifted to Microsoft’s European hub in Ireland over the last few years.

Government Response

The ministry reassured that it is actively engaging with Microsoft’s regional and global leadership to ensure that any structural changes do not reduce the company’s long-term commitment to Pakistan’s digital ecosystem.

Despite the corporate downsizing, Microsoft is expected to continue operating indirectly in Pakistan through partnerships, particularly in education, government digitization, and cloud infrastructure.

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