Microsoft, Shell, Pfizer Quit Pakistan — Why Big Brands Fled Pakistan and Chose India Instead

The recent exit of global giants like Microsoft, Shell, and Pfizer from Pakistan has sparked concern over the country’s business environment and raised a critical question — why are multinational companies leaving Pakistan while expanding rapidly in India and other regional markets?

While the narrative often focuses on the departures, the full picture tells a more complex story. Some companies are indeed pulling out, but at the same time, new investors are entering Pakistan, drawn by signs of economic stabilization and emerging growth opportunities.

Why Global Corporations Are Leaving Pakistan

Over the past four years, several major multinationals — including Pfizer, Sanofi-Aventis, Eli Lilly, Procter & Gamble, Shell, Total, Telenor, and Uber — have either exited or divested from Pakistan. The pharmaceutical sector has seen the sharpest decline, shrinking from 48 foreign firms three decades ago to less than half that number today.

Key reasons behind these exits include:

• High corporate taxation and unpredictable fiscal policies
• Restrictions on profit repatriation, making it difficult to transfer earnings abroad
• Rigid price controls in pharmaceuticals
• Regulatory hurdles that slow down approvals and expansion
• Currency instability and rising operational costs

For some companies like Procter & Gamble, Pakistan’s exit wasn’t personal — it was strategic. P&G has been refocusing on larger markets like the U.S., Europe, China, and India, while leaving smaller, volatile economies such as Nigeria, Bangladesh, and Pakistan.

Similarly, Shell’s decision to sell its Pakistani operations to Saudi-based Wafi Energy is part of its global restructuring strategy, not necessarily a reflection of Pakistan’s potential. Telenor’s exit in 2022 followed a similar pattern, as the telecom giant streamlined its operations worldwide.

Why India Became the Preferred Choice

As Pakistan struggles with regulatory challenges, India has emerged as the region’s top investment destination. Multinationals view India as a stable, scalable, and policy-friendly market offering:

• Streamlined foreign investment rules
• Strong consumer demand and a growing middle class
• Government incentives for manufacturing and exports
• A skilled workforce and improved infrastructure

Global companies like Apple, Tesla, and Samsung have already ramped up investments in India, attracted by its expanding digital economy and consistent growth policies.

The Other Side of Pakistan’s Story: New Investments Are Rising

Despite high-profile exits, Pakistan is not being abandoned altogether. New investors are quietly moving in, seeing opportunity where others see uncertainty.

For example:

• China’s Challenge Group is investing $150 million in a high-tech textile zone in Punjab, expected to create 18,000 jobs and $100 million in exports.
• Haleon, a global consumer healthcare company, is expanding its Jamshoro facility to make Pakistan a regional production hub.
• Belarus is planning a tractor manufacturing joint venture in Balochistan.
• UAE’s Mashreq Bank has announced a $100 million investment to improve financial inclusion and make Pakistan its back-office hub for global operations.

Moreover, the China-Pakistan Economic Corridor (CPEC) is regaining momentum, with $8.5 billion in new investments recently finalized. These include projects in renewable energy, agriculture, steel, electric vehicles, and healthcare.

The Way Forward: Compete, Don’t Complain

Pakistan currently hosts over 200 multinational companies, which contribute more than one-third of total tax revenues. However, their export contribution remains limited, as many rely primarily on domestic sales instead of global markets.

For Pakistan to retain and attract more international brands, it must shift towards an export-driven industrial policy — one that rewards innovation, efficiency, and competitiveness. Companies like Service Long March Tyres, a Pakistani-Chinese joint venture, are already leading the way by replacing imports and exporting over $100 million worth of tyres annually to the United States.

Conclusion

While the exits of global names like Microsoft, Shell, and Pfizer highlight Pakistan’s economic challenges, they do not signal an end to foreign investment. Instead, they mark a turning point — from reliance on protective policies to a new era focused on export-led growth and sustainable competitiveness.

If Pakistan can streamline regulations, stabilize its currency, and ensure investor confidence, it has the potential not only to retain global companies but also to attract the next wave of international investment that’s already beginning to take shape.