24-hour internet shutdown costs Pakistan Rs1.3 billion: study

ISLAMABAD: A study conducted by the Pakistan Institute of Development Economics (PIDE) has revealed that 24-hour internet shutdowns result in a direct loss of Rs1.3 billion, equivalent to 0.57 per cent of the nation’s daily GDP average.

The study, featured in PIDE’s research infographic titled ‘The Economic Cost of Internet Closure,’ sheds light on the consequences of internet shutdowns in the country, according to a press release issued on Sunday.

While emphasizing the essential role of the internet in modern times, the study highlights that Pakistan’s internet infrastructure lags in terms of both quality and coverage.

Recent internet shutdowns in various parts of the country have had a profound impact on multiple sectors, causing significant financial losses and operational challenges.

Various services, including online cab rides, food delivery, freelance work, transport, and postal services, have all been adversely affected by internet disruptions.

The PIDE data revealed that online cab services, a vital aspect of modern transportation, experienced a 97 per cent reduction in rides on days when the internet was shut down, resulting in a daily industry loss of Rs 29 to 32 million.

Similarly, online food delivery services suffered a 75 per cent decrease in orders, translating to a substantial daily loss of Rs 135 million.

The freelance community, a significant contributor to Pakistan’s economy, also faced setbacks due to internet disruptions. Denial of orders to Pakistani freelance workers led to a loss of over $1.3 million in revenue, equivalent to Rs 390 million, impacting both livelihoods and the national economy.

Furthermore, the suspension of 3G/4G services for a single day resulted in a loss of PKR 450 million to the telecommunications sector alone.

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PIDE had earlier estimated the economic cost of protests to be around 2.0 per cent of the GDP. The closure of economic activities, either due to protests or internet shutdowns, significantly affects economic activity in the country.

Dr Nadeem ul Haque, Vice Chancellor of PIDE, emphasized that access to high-quality internet not only offers opportunities for youth, particularly in remote areas but also plays a crucial role in narrowing the gap between the privileged and the general public. Utilizing online tools for education and professional purposes empowers rural youth to compete on national and international levels. INP