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Ecommerce has been promoted across the globe as one of the key enablers for youth entrepreneurship and employment. Despite favorable internet and mobile demographics and increasing e-commerce adoption, Pakistan’s e-commerce market size remains tiny compared to other similar countries.
Pakistan’s e-commerce industry has grown rapidly over the past few years but heavy reliance on cash has ensured gathering data and establishing benchmarks remains a challenge.
The people of Pakistan today were seen demanding that Amazon, the largest online shopping website, be brought to Pakistan. Let’s take an in-depth review of the e-commerce industry in Pakistan and impact of Amazon’s arrival.
Amazon – a review
In the beginning, Amazon.com sold books. Founded by Jeff Bezos in 1994, Amazon is now a titan of e-commerce, logistics, payments, hardware, data storage, and media. Its Web services business includes renting data storage and computing resources, “cloud computing,” over the Internet.
By the end of 2018, Amazon’s delivery infrastructure included more than 180 warehouses, 28 sorting centers, 59 local package delivery stations, and 65 hubs for its two-hour Prime Now (express) deliveries.
Amazon is considered to be one of the ‘Big Four’ of technology along with Google, Apple, and Facebook due to its market capitalization which crossed the trillion mark in September 2018, and also because of its disruptive innovation and hyper-competitive application process.
The company also owns a publishing arm, a film and Television studio, produces consumer electronics such as Kindle e-readers, and tablets, and is the world’s largest provider of cloud infrastructure services.
Pakistan’s e-commerce capacity
According to a report published by the State Bank of Pakistan (SBP), Pakistan’s e-commerce market is estimated to have expanded to Rs. 234.6 billion in the financial year 2019-20, showing a growth of 55.5 percent on a year-on-year basis.
The transaction of the e-commerce comprises of Cash-on-Delivery (CoD), which stood at Rs. 140.7 billion, whereas payments through digital means stood at Rs. 93.8 billion.
Pakistan’s first Ecommerce Index – curated by a Pakistani online shopping platform using internal data from 2019 – offers these insights and helps map the trends witnessed in consumer shopping patterns over a year.
With the largest population, Punjab has the highest contribution to e-commerce order shares at 55%, followed by Sindh at 36%. Balochistan, KPK and Azad Kashmir, cumulatively contribute the remaining 9%.
The Index offers a city-wise perspective on order market share as well, with Karachi contributing 24%, Lahore 17% and Islamabad and Rawalpindi 10%. Multan is recognised as a growing city for e-commerce alongside Sialkot and Hyderabad.
Barriers
With a population of 208 million and several financial inclusion solutions, Pakistan is one of the largest unrealized markets of e-commerce in the world. There are many things that have stopped Pakistan from realizing its own potential and developing its own e-commerce systems.
The two obvious factors are the lack of literacy that is required to create a transaction from start to finish and the lack of financial inclusion. PayPal, which is the preferred digital method of payment worldwide, is not even available in Pakistan.
Amazon and eBay are also excluded from Pakistan; these global giants could potentially offer so much to the economy and lifestyle of those living there. Having their own similar websites would benefit many sectors and businesses in Pakistan, particularly as the by-products would be sure to have a trickledown effect.
Amazon ignores Pakistan, but Pakistanis don’t
Amazon has separate websites for the main countries it operates in including the United States, the United Kingdom and our arch-rival India. However, Pakistan does not make that list.
Today (Saturday), #wewantAmazon was trending on Twitter, where young Pakistanis were requesting the tech giant to operate in the country.
#AmazonInPakistan
We’re welcome you to please facilitate Pakistan, there is no scarcity of talented and skilled work force in Pakistan, we’re excited and willing to work with you!#Amazoninpakistan#Amazoninpakistan#Amazoninpakistan@amazon@ZakaWaqar— Talha Yousaf (@talha_yousaf96) December 12, 2020
Its A Request To @amazon To Come In Pakistan We Humbly Request @JeffBezos To Open Office In Pakistan Thank you..
#AmazonInPakistan#Pakistan— Haider Ali Mughal (@itx_mughal934) December 12, 2020
We want Amazon in Pakistan.
We really need to excel in online world! @ImranKhanPTI@amazon We are ready to welcome you in Pakistan!#AmazonInPakistan#Amazon— Amina Rauf (@aminarauf0) December 11, 2020
