After a mega layoff of almost 9,000 employees globally, Microsoft has officially ceased its direct operations in Pakistan after 25 years of presence in the country. The move, which was confirmed by Jawwad Rehman, the ex-founding country head of Microsoft Pakistan and reported widely by various media outlets, is yet to be justified by the brand, although experts cite the country’s challenging economic and political landscape.
Microsoft initially established its presence in Pakistan on March 7, 2000, and with its departure on July 3, 2025, it marks the end of an era for the software giant’s presence in the country. Microsoft played a significant role in the country’s digital transformation, promoting IT standards and supporting digital literacy initiatives.
In a LinkedIn post, Rehman wrote, “Today, I learned that Microsoft is officially closing its operations in Pakistan. The last few remaining employees were formally informed and just like that, an era ends…”
Microsoft’s exit linked to Pakistan’s economic, political instability
Rehman shed light on the reasons that led Microsoft to take such a drastic decision. “But today’s news forces reflection. This is more than a corporate exit. It’s a sobering signal of the environment our country has created.. one where even global giants like Microsoft find it unsustainable to stay. It also reflects on what was done (or not done) with the strong foundation we left behind by the subsequent team and regional management of Microsoft,” he mentioned.
Although Microsoft’s official channels are yet to issue a statement, experts point out some of the possible reasons that may have led Microsoft to consider shutting down its Pakistan division.
Unstable economy: The company’s exit is widely linked to Pakistan’s weakening economic conditions.
Political instability: The shut down of operations is also attributed to a shifting political landscape and frequent government changes, a major reason that has led to organisations shying away from the country.
Challenging trade conditions: The presence of other factors like high taxes, fluctuating currency value and difficulties in importing technology may have also caused Microsoft to consider quitting the country.
Significant trade deficit: Pakistan’s trade deficit has hit USD 24.4 billion in FY2024.
Foreign Exchange reserves dropped: Reserves dropped to USD 11.5 billion by June 2025, impacting tech imports and investor trust.
“Exactly 25 years ago, in June 2000, I had the honour of launching and leading Microsoft Pakistan. What began as a bold, hope-filled mission became the most rewarding journey of my personal and professional life. I spent seven years building Microsoft’s presence, assembling a talented team, serving customers, and working hand-in-hand with amazing partners. It wasn’t just a job.. it was a calling. It shaped me, stretched me, and helped define who I am today,” wrote Rehman in his post.
“We must ask: What changed? What was lost? What happened to the values, leadership, and vision that once made it all possible?” he added.
Why did Microsoft leave Pakistan?
While Microsoft didn’t explicitly state reasons, experts say that Pakistan’s economical instability and the political turmoil led to the software giant exiting the country.
Former President of Pakistan, Dr. Arif Alvi, commented on the development, calling it a “troubling sign” for the country’s economic future. He recounted a missed opportunity in 2022 when Microsoft was reportedly considering a major investment in Pakistan, a plan that was “upended” by a “regime change,” leading Microsoft to favour Vietnam for its expansion instead.
“As we sat in the lawn outside my office, our conversation spanned fascinating topics like AI, Quantum computing, gut microbiomes, longevity, and more. During our discussion, I asked him directly, “Why isn’t Microsoft investing in Pakistan?” He leaned in, sharing in confidence that he had just spoken with PM Imran Khan and arranged a call between the PM and Microsoft CEO Satya Nadella. In a hushed tone, he asked me to keep it quiet, revealing that “all is set and within two months, the PM and I will announce a major Microsoft investment in Pakistan,” write Alvi recalling his personal exchange with Microsoft founder Bill Gates in Pakistan.
Despite the closure of its local office, it’s important to note that Microsoft products and services, such as Windows, Office 365, and Azure, will likely remain available in Pakistan. Regional offices, possibly in the Middle East or Singapore, are expected to manage Pakistani clients moving forward, with service delivery handled by certified local partners.