E-commerce has emerged as a revolutionary contributor to the Information Technology sector. The term E-commerce conjures up a litany of colloquial terminologies one can recall from the basic jargon etched in our brains.

Pakistan is the sixth most populous country in the world (approximately 200 million people) and the nascent E-commerce industry in Pakistan has exponential room for growth. There have been a bevy of entrants in the industry as more and more people are making robust forays in the E-commerce industry.

The interminable utility of E-commerce has finally caught up with the Pakistani entrepreneurs and investors now overtly recognize the potential it holds. In order to support the burgeoning sector, the government has already initiated a process to develop E-commerce policy which can act as engine of growth.

There are an array of factors that vividly illustrate how this industry is bound to surge and further galvanize support for entrepreneurs and small and medium enterprises to usher forth in the viable economic market arena. 

The Small and Medium Enterprises Development Authority (SMEDA) has always supported the E-commerce sector and it was one of the first institutions in Pakistan to recognize the potential it holds. In collaboration with Smeda, International Trade Centre (ITC) published a book titled ‘Secrets of E-commerce’ in 2002. The book is a comprehensive publication highlighting issues concerning electronic commerce at that time.

This guide was considerably ahead of its time, thus paving the way for further research and development of the E-commerce sector in Pakistan. Importance of the IT sector has increased since then and Smeda has listed the IT sector among sectors which hold immense potential as the number of internet users in Pakistan continue to multiply.

There is a direct link between internet users and the E-commerce industry. As the number of internet subscribers goes up in Pakistan, the chance of more E-commerce activity increases.

According to World Bank and UNCTAD, around 16 percent of population in Pakistan is linked to the internet, which means that approximately 33 million people are utilizing the internet services.

However, growth rate of internet users has been exponential. At this rate the number of individuals using the internet will double in the next four years. 

Even if a small percentage of internet users are utilizing the web for E-commerce activities, still this is an extremely encouraging precursor, since there is massive room for growth in a market that is virtually untapped.

Widespread access of the internet will mean a greater propensity of the masses to use it.

Moreover, internet penetration is a vital factor which can augment the number of potential users of online businesses’ and can ultimately increase customer traffic on such websites.

In the future, a significant chunk of the E-commerce activity in Pakistan will be supplemented through mobile phone usage. With the emergence of ultra-fast Mobile Internet subscriptions, internet access in the urban metropolitan centers has become omnipresent, while in far flung places internet access has been introduced only recently and is gradually gaining traction.

According to Pakistan Telecommunication Authority (PTA), the total number of 3G, 4G and LTE subscribers has crossed 32 million in August, 2016. A report by GSMA states that 3G coverage will reach 90percent of Pakistan by 2020.

According to the Social Networking Website, Facebook, there are 30 to 35 million active monthly Facebook users in Pakistan in 2018, while 85 percent of users access Facebook through a mobile device.

Social media and its variants intensify internet usage as it cajoles people to explore areas and avenues which as a customer one is not acquainted with or is introduced to for the first time.

The rapid expansion of E-commerce hinges on certain external elements. In today’s globalized world of social media, information and its access is intertwined and woven with all subsequent social media outlets. Social media has been a real catalyst in promoting E-commerce activities in Pakistan.

There are a lot of benefits linked to E-commerce and advancement in this sector has led to a growth in supporting industries such as warehousing, express delivery, online/mobile payment systems, and digital/online marketing and advertising.

It may seem that E-commerce in Pakistan is growing at an unprecedented rate but still there is a long way to go.

The United Nations Conference on Trade and Development (UNCTAD) report - 2017 has ranked 144 countries using a B2C E-commerce index value which has been calculated using the internet users as a percentage of population, percentage of credit card holders, share of population having mail delivered at home and secure servers (per 1 million people).

Pakistan has been ranked 120th out of 144 countries on this index which summarizes Pakistan’s underlying capability of carrying out B2C E-commerce. The index is strongly positively correlated to the variation in the share of individuals who shop online.

E-commerce in Pakistan is on a trajectory of success but with great zeal, alacrity and systematic dedication can we tread on the road to becoming a force to be reckoned with and can be commensurate to the leading E-commerce industries in the world in terms of growth.