Microsoft closes its operations in Pakistan.

Microsoft has decided to close its operations in Pakistan, marking the end of a 25-year presence in the South Asian country. The Redmond-based company recently announced that it would modify its operating model in Pakistan, starting to serve its customers through resellers and other nearby Microsoft offices.

A company spokesperson clarified that agreements with clients and service will not be affected by this change, emphasizing that this model has already been successfully implemented in several countries around the world. They assured that customers will remain a priority and will receive the same high level of care in the future.

This decision will impact five Microsoft employees in Pakistan. Sources mention that the company did not have engineering resources in the country, unlike India and other growing markets, and that its employees were focused on selling Azure and Office products.

Microsoft's exit is part of a broader restructuring within the company. The Ministry of Information and Broadcasting of Pakistan commented that Microsoft's departure is part of a larger program to optimize the workforce. Earlier this week, the global company reduced its workforce by 4%, which amounts to approximately 9,000 jobs worldwide.

Over the past few years, Microsoft has shifted the management of licenses and commercial contracts for Pakistan to its European center in Ireland, while certified local partners have handled day-to-day service delivery. The ministry expressed its intention to continue engaging with regional and global Microsoft leaders to ensure that any structural changes strengthen the company’s commitment to customers, developers, and partners in Pakistan.

Jawwad Rehman, a former Microsoft executive and its first leader in Pakistan, commented on the company’s exit in a LinkedIn post, indicating that this is more than just a corporate withdrawal; it reflects the environment that has been created in the country, suggesting that even large companies like Microsoft find it unsustainable to remain. This analysis contrasts with the recent announcement by the federal government of Pakistan to provide IT certifications from technology companies, including Google and Microsoft, to half a million youth.

Microsoft's exit also highlights the broader challenges facing the tech sector in Pakistan. Unlike India and other markets in the region, Pakistan has not managed to establish itself as a leading destination for engineering outsourcing for Western tech giants. Instead, the country's tech ecosystem is dominated by local companies that have developed their own engineering capabilities and by Chinese firms like Huawei, which have gained significant market share by offering high-quality infrastructure to telecommunications companies and banks.

The Ministry of Information and Broadcasting of Pakistan has not responded to requests for comment on the situation.