Amir Saeed

Effective AI governance is essential to ensure inclusive digital growth and prevent socioeconomic disparities in Pakistan’s evolving technological landscape.

The Asian Development Policy Report 2025: Harnessing Digital Transformation for Good – highlights the transformative power of digitalisation in reducing income inequality and poverty across Asia.

The report authored by Asian Development Bank says that digital technologies create new opportunities for employment, entrepreneurship, and access to essential services, particularly benefiting disadvantaged groups such as low-income households, women, and residents of less developed regions.

For instance, in China, a one-unit increase in city digitalisation correlates with a 1.94% reduction in income inequality, driven by higher income growth among low-income and less-educated households.

In Vietnam, increased internet access at the provincial level raises the likelihood of female household heads working in the service sector by 16.6%, surpassing the increase for male household heads. Regionally, a 1% increase in internet access corresponds with a 0.32% decline in poverty rates, reflecting improved access to jobs, finance, healthcare, and education.

Despite these positive impacts, the report stresses that without effective AI governance, digital transformation risks deepening the digital divide. Unequal access to digital infrastructure and skills can exclude vulnerable populations, undermining the inclusive potential of technology. Therefore, AI governance must focus on ensuring transparency, accountability, and equitable access to AI-driven services.

By embedding inclusive policies and fostering cooperation among governments, the private sector, and civil society, AI governance can prevent new forms of exclusion. This approach will ensure digital transformation and serve as a bridge rather than a barrier, promoting equitable growth and opportunity for all segments of society in Asia, the report notes.

Talking to WealthPK, Aatizaz Hussain, former manager of Financial Literacy Programme at National Institute of Banking and Finance (NIBAF), said that AI governance is crucial to prevent the emergence of a new digital divide.

He emphasised that while Pakistan’s National AI Policy lays important groundwork, it currently lacks strong enforcement mechanisms and comprehensive ethical oversight. He warned that without clear regulations on AI accountability, transparency, and bias mitigation, marginalised communities risk being excluded from the benefits of AI technologies.

Hussain advocated for the country to adopt international best practices, such as the European Union’s risk-based AI regulatory framework, to balance innovation with protection against discrimination and exclusion.

Moreover, he highlighted the urgent need for investment in digital literacy and infrastructure, particularly in rural and underserved areas, to ensure equitable access to AI-driven services. He stressed that building a responsible AI ecosystem requires multi-stakeholder engagement involving the government, the private sector, academia, and civil society.

Credit: INP-WealthPk