Pakistan launches first locally hosted AI cloud to keep national data inside the country

The undated picture shows building of Data Vault Pakistan. (Data Vault Pakistan)
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Updated 27 November 2025
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Pakistan launches first locally hosted AI cloud to keep national data inside the country

  • New sovereign cloud allows financial, health, telecom and government data to stay within Pakistan while enabling AI development
  • Telenor–Data Vault partnership offers on-shore access to high-performance GPUs and AI infrastructure for businesses, public institutions

KARACHI: Pakistan this week launched its first locally hosted artificial intelligence cloud, a step officials say will allow sensitive national data to remain inside the country while giving businesses and public institutions access to powerful AI computing for the first time.

Pakistan, like many emerging markets, has relied on cloud servers located abroad for AI and machine-learning workloads, raising concerns over compliance with domestic regulations, financial data privacy, telecom metadata protections and broader national security. Around the world, countries are investing in “sovereign clouds” — cloud platforms physically hosted within national borders under local jurisdiction — to build digital autonomy and reduce reliance on foreign service providers. Pakistan’s new AI cloud aims to meet that need by keeping all AI training, analytics and data processing within its borders.

The cloud has been launched by Telenor Pakistan in collaboration with Data Vault Pakistan, whose high-density AI data center will host all workloads domestically.

“Today we are turning sovereign, high performance computer into a national capability,” Data Vault Pakistan CEO Mehwish Salman Ali said at the launch event on Wednesday. 

“By weaving Data Vault Cloud into Telenor Pakistan’s enterprise portfolio, we are giving every organization a secure, local path from idea to inference — without sending data abroad. This is how Pakistan moves from consuming AI to producing it.”

According to the press release, the cloud enables organizations to train and deploy artificial intelligence models, process large datasets and run real-time applications without relying on offshore cloud regions. It covers sensitive data types including financial transactions, medical imaging, telecom data and government records, ensuring none of it leaves Pakistan.

AI systems require intensive computing power, especially for tasks such as training large language models, processing video analytics, powering generative AI systems or running real-time fraud detection. These workloads depend on GPUs — specialized processors far more powerful than standard chips. Pakistan has previously struggled to access such hardware because of global shortages and high import costs.

The new platform introduces GPU-as-a-Service, allowing organizations to rent NVIDIA-grade accelerators on demand rather than purchase expensive physical equipment. The release said this will enable a range of applications, from machine-learning pipelines and industrial automation to Urdu and regional-language AI models, computer-vision systems for public safety and advanced sector-specific analytics in health care and fintech.

Officials expect the cloud to support national priorities across multiple sectors. In finance, it can power fraud detection and anti-money laundering systems. In health care, it can assist with diagnostics and medical image processing. Manufacturers and logistics companies can use the platform for automation and predictive analytics, while public agencies can deploy secure local AI for citizen services and governance.

According to the release, the initiative aligns with regulations from the State Bank of Pakistan (SBP), the Pakistan Telecommunication Authority (PTA), health care data laws and emerging national AI safety frameworks. Hosting all data within the country, the statement said, strengthens cybersecurity, improves audit trails, enhances privacy and identity controls and bolsters digital trust.

With onshore GPU capacity now available in Pakistan, researchers and startups can develop their own AI systems rather than depend on offshore platforms. 

The press release said the partnership “positions Pakistan alongside global markets investing in sovereign AI clouds to power next-generation digital transformation,” and gives the country the foundation “to move from consuming AI to producing it.”


IMF warns against policy slippage amid weak recovery as it clears $1.2 billion for Pakistan

Updated 11 December 2025
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IMF warns against policy slippage amid weak recovery as it clears $1.2 billion for Pakistan

  • Pakistan rebuilt reserves, cut its deficit and slowed inflation sharply over the past one year
  • Fund says climate shocks, energy debt, stalled reforms threaten stability despite recent gains

ISLAMABAD: Pakistan’s economic recovery remains fragile despite a year of painful stabilization measures that helped pull the country back from the brink of default, the International Monetary Fund (IMF) warned on Thursday, after it approved a fresh $1.2 billion disbursement under its ongoing loan program.

The approval covers the second review of Pakistan’s Extended Fund Facility (EFF) and the first review of its climate-focused Resilience and Sustainability Facility (RSF), bringing total disbursements since last year to about $3.3 billion.

Pakistan entered the IMF program in September 2024 after years of weak revenues, soaring fiscal deficits, import controls, currency depletion and repeated climate shocks left the economy close to external default. A smaller stopgap arrangement earlier that year helped avert immediate default, but the current 37-month program was designed to restore macroeconomic stability through strict monetary tightening, currency adjustments, subsidy rationalization and aggressive revenue measures.

The IMF’s new review shows that Pakistan has delivered significant gains since then. Growth recovered to 3 percent last year after shrinking the year before. Inflation fell from over 23 percent to low single digits before rising again after this year’s floods. The current account posted its first surplus in 14 years, helped by stronger remittances and a sharp reduction in imports. And the government delivered a primary budget surplus of 1.3 percent of GDP, a key program requirement. Foreign exchange reserves, which had dropped dangerously low in 2023, rose from US$9.4 billion to US$14.5 billion by June.

“Pakistan’s reform implementation under the EFF arrangement has helped preserve macroeconomic stability in the face of several recent shocks,” IMF Deputy Managing Director Nigel Clarke said in a statement after the Board meeting.

But he warned that Islamabad must “maintain prudent policies” and accelerate reforms needed for private-sector-led and sustainable growth.

The Fund noted that the 2025 monsoon floods, affecting nearly seven million people, damaging housing, livestock and key crops, and displacing more than four million, have set back the recovery. The IMF now expects GDP growth in FY26 to be slightly lower and forecasts inflation to rise to 8–10 percent in the coming months as food prices adjust.

The review warns Pakistan against relaxing monetary or fiscal discipline prematurely. It urges the State Bank to keep policy “appropriately tight,” allow exchange-rate flexibility and improve communication. Islamabad must also continue raising revenues, broadening the tax base and protecting social spending, the Fund said.

Despite the progress, Pakistan’s structural weaknesses remain severe.

Power-sector circular debt stands at about $5.7 billion, and gas-sector arrears have climbed to $11.3 billion despite tariff adjustments. Reform of state-owned enterprises has slowed, including delays in privatizing loss-making electricity distributors and Pakistan International Airlines. Key governance and anti-corruption reforms have also been pushed back.

The IMF welcomed Pakistan’s expansion of its flagship Benazir Income Support Program, which raises cash transfers for low-income families and expands coverage, saying social protection is essential as climate shocks intensify. But it warned that high public debt, about 72 percent of GDP, thin external buffers and climate exposure leave the country vulnerable if reform momentum weakens.

The Fund said Pakistan’s challenge now is to convert short-term stabilization into sustained recovery after years of economic volatility, with its ability to maintain discipline, rather than the size of external financing alone, determining the durability of its gains.