Pakistan’s AI Data Centre Ambitions Need More Than Cheap Electricity
A year ago, Pakistan announced that it would allocate 2,000 MW of electricity to AI data centres and Bitcoin mining. The initiative was presented as a way to generate revenue from surplus electricity, attract foreign investment, and expand the digital economy. Since then, global competition over AI infrastructure has accelerated sharply. According to UN Trade and Development (UNCTAD), data centres accounted for more than one-fifth of the value of all global greenfield investment projects in 2025, attracting over US$270 billion in announced investment. For the first time, investment in telecommunications—driven largely by AI data centers—surpassed renewable energy.
This shift offers Pakistan a genuine opportunity. Yet international experience suggests that AI infrastructure is no longer a competition determined mainly by low-cost electricity. Countries that attract large-scale investment combine available energy with reliable transmission networks, high-speed digital connectivity, predictable regulation, and strong investor confidence. Emerging economies such as Malaysia and India have followed this sequence, developing broader digital ecosystems before positioning themselves as regional AI infrastructure hubs. Pakistan, by contrast, enters the race with only 31 commercial data centers, compared with 296 in India and 114 in Malaysia. The gap reflects ecosystem readiness more than a lack of ambition.
The principal constraint is not electricity alone but the interaction among electricity, water, and infrastructure. Although Pakistan has allocated power for AI development, data centres consume far more than electricity. A conventional 1 MW facility may require around 26 million litres of water each year for cooling, and the largest AI campuses now operate at hundreds of megawatts. This changes the policy debate from one about surplus electricity to one about resource prioritisation. As AI infrastructure expands globally, countries are increasingly planning energy, water, and digital networks together rather than treating them as separate sectors.
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This does not diminish Pakistan’s AI ambitions, but it does raise an important strategic question. Should the country compete for large hyperscale AI campuses, or should it pursue a more targeted strategy centred on sovereign AI infrastructure serving domestic businesses, government agencies, universities, and regional cloud demand? Pakistan’s first sovereign AI cloud, supported by approximately 3,000 enterprise-grade GPUs, suggests that such a pathway is already emerging.
Ultimately, Pakistan’s success in the AI economy will depend less on how much electricity it allocates and more on whether it can provide the dependable infrastructure that global investors expect. The next phase of policy should therefore focus not only on attracting AI investment but also on building the physical and digital foundations that allow it to endure
