🇵🇰 EXODUS OF MULTINATIONALS: Foreign Companies Exit Pakistan Amid Economic and Regulatory Chaos
By Staff Reporter | October 5, 2025
KARACHI – A growing list of multinational companies (MNCs) is pulling the plug on their operations in Pakistan, citing an increasingly hostile business environment, macroeconomic instability, and rigid government regulations. From tech giants like Microsoft to global FMCG leader Procter & Gamble (P&G), and mobility player Careem, 2025 has seen an alarming uptick in corporate exits or operational scale-downs, raising concerns over Pakistan’s investment climate and future economic trajectory.
🚨 A Worrying Trend: Who’s Leaving and Why?
At least half a dozen major global corporations have either exited or significantly downsized their operations in Pakistan since the start of 2025. Among the most high-profile are:
Procter & Gamble / Gillette Pakistan
P&G announced a major restructuring of its presence in Pakistan, discontinuing local manufacturing and commercial operations. Gillette Pakistan, its subsidiary, is considering delisting from the Pakistan Stock Exchange (PSX).
“The decision is part of a global realignment of operations. The difficult operating environment, volatile currency, and shrinking margins made continued direct investment unviable,” said a P&G spokesperson.
Careem Suspends Ride-Hailing in Pakistan
Careem, owned by Uber, shocked millions of users when it announced it would suspend its ride-hailing service in Pakistan effective July 18, 2025. While its food and delivery verticals remain operational in select cities, the ride-hailing exit marks the end of an era for a company that had operated in Pakistan for over a decade.
“The macroeconomic situation has made sustainability difficult, and our core ride-hailing business is no longer viable under current market conditions,” Careem said in a statement.
Microsoft Shuts Down Operations After 25 Years
One of the most symbolic exits came from Microsoft, which shut down its official operations in Pakistan after more than two decades.
Industry insiders linked the move to:
- Political instability,
- Currency devaluation,
- Lack of enforcement of intellectual property laws, and
- Restrictions on transferring profits out of the country.
The decision sent shockwaves through Pakistan’s tech ecosystem.
“When tech giants leave, it signals deep-rooted policy failures,” said Jehan Ara, a tech entrepreneur and former head of P@SHA (Pakistan Software Houses Association).
Yamaha Motor Pakistan
Facing a steep decline in demand and new policy hurdles in the auto sector, Yamaha Motors scaled down operations, warning that the auto industry may see more exits unless policy reforms are introduced.
New government policies, such as the requirement for local manufacturers to export a minimum share of products in exchange for import rights, have drawn sharp criticism.
🔍 Why Are They Leaving? A Deeper Look
The departures are not isolated. Analysts point to a confluence of factors that have created a hostile investment environment:
📉 Macroeconomic Instability
- Inflation remains high, with core inflation nearing 25% year-on-year.
- The Pakistani rupee has depreciated over 40% against the dollar since January 2024.
- Foreign exchange reserves are barely sufficient to cover two months of imports.
đźš« Restrictions on Profit Repatriation
Foreign companies often face months-long delays in transferring profits abroad due to capital control measures imposed by the State Bank of Pakistan.
🏛️ Unpredictable Policies
Frequent changes in tax codes, import bans, and unclear implementation of business laws have added to investor frustration.
⚖️ Regulatory and Bureaucratic Bottlenecks
From acquiring licenses to importing components or tech equipment, the red tape has worsened under current administration policies.
🗣️ Expert View: What Does This Mean for Pakistan?
“This is more than a business story. It’s a red flag for the entire economy,” says Dr. Ishrat Husain, former Governor of the State Bank of Pakistan. “When multinationals exit, it affects jobs, tax revenue, and consumer choice — but more importantly, it erodes investor confidence for years.”
“Even those companies that haven’t fully exited are shifting to asset-light models — distributors, licensees — rather than investing directly,” notes Khurram Schehzad, a financial analyst at Alpha Beta Core.
đź’Ľ Impact on the Job Market
Thousands of direct and indirect jobs have been affected:
- Careem’s exit alone impacts over 100,000 drivers.
- P&G’s withdrawal affects manufacturing and distribution chains.
- Yamaha’s partial closure affects automotive suppliers and dealers.
📉 Investment Climate Deteriorating
Foreign Direct Investment (FDI) in Pakistan dropped to $750 million in FY2025, a sharp decline from $1.5 billion in FY2023, according to central bank data.
Pakistan now ranks 150th out of 190 economies in the World Bank’s Ease of Doing Business Index — its worst performance in a decade.
🛑 What’s Next?
Unless the government acts swiftly with structural reforms, analysts warn more exits could follow — particularly in sectors like fintech, e-commerce, and automotive.
“Without clear, consistent, and business-friendly policies, foreign capital will continue to flee,” warns Dr. Kaiser Bengali, a noted economist.
🔚 Conclusion
The exit of global giants in 2025 has exposed deep fractures in Pakistan’s economic and regulatory framework. While individual companies may cite global realignments, the scale and pattern of exits point to systemic issues that need urgent attention.
As the economy grapples with stagflation and debt concerns, Pakistan’s leadership faces a stark choice: enact credible reforms or risk becoming an increasingly isolated market on the global investment map.