The world is witnessing a bizarre change in the way artificial intelligence (AI) is taking over the world, as new players have emerged to threaten the dominance of long-standing industry behemoths.
Among them, China’s DeepSeek has quickly gained international attention, positioning itself as a formidable competitor in the AI industry.
DeepSeek’s rise is particularly noteworthy because it comes amidst heightened global competition, stringent US export restrictions on advanced semiconductor technology, and a growing AI divide between the world’s leading economies.
With dominating OpenAI’s ChatGPT, DeepSeek AI Assistant has become the most downloaded free application on Apple’s App Store in the United States, a feat that surprised many in the tech industry.
The company’s ability to develop a cost-efficient, high-performing AI model—the R1—at a fraction of the cost of similar models developed by Western firms has raised eyebrows.
As per the statistics, DeepSeek built its model with an investment of under $6 million, whereas its competitors spent hundreds of millions on AI model training. This remarkable efficiency highlights an important reality: innovation does not necessarily require excessive spending but rather strategic planning, research investment, and a strong talent base.
Pakistan, like many developing nations, finds itself at a crossroads when it comes to AI adoption. While the government and private sector are increasingly recognizing AI’s transformative potential, the country still lags behind in AI research, development, and practical implementation.
DeepSeek’s success offers key takeaways for Pakistan, demonstrating how a country can leverage AI to drive economic progress despite resource constraints. DeepSeek’s emergence comes at a time when AI is at the center of a global technological arms race.
The competition between the United States and China has intensified, with AI becoming the latest flashpoint. Washington has taken preemptive measures to limit China’s access to advanced semiconductor technology, fearing that AI advancements could enhance China’s military and economic capabilities.
Despite these challenges, DeepSeek has demonstrated resilience by developing advanced AI models using limited computational power and alternative chip technologies. This ability to innovate under constraints is a crucial lesson for Pakistan, which also faces technological limitations and infrastructure challenges.
Several governments, including those of Australia, South Korea, and the United States, have restricted the use of DeepSeek’s AI tools in official domains, citing data security concerns. The growing national security concerns are influencing technology policies, further politicizing AI technologies.
This situation highlights Pakistan’s need for digital innovation and AI self-sufficiency. To lessen its need for outside AI suppliers, the government should support domestic research, provide incentives to AI entrepreneurs, and collaborate with friendly countries to share technology. Despite Pakistan’s early embrace of AI, there are still obstacles to overcome.
The Presidential Initiative for Artificial Intelligence and Computing (PIAIC), providing training courses in cloud computing, blockchain, and AI, is a positive step toward AI literacy. Still, there are a number of obstacles to AI growth in Pakistan, such as a dearth of research and development.
Unlike China, which has invested heavily in AI research and university partnerships, Pakistan’s AI research is underfunded and lacks institutional support. Most universities have yet to introduce advanced AI curricula, limiting the talent pipeline.
A significant portion of Pakistan’s population lacks access to high-speed internet, which is a fundamental requirement for AI-driven innovations. Without improved connectivity, AI adoption will remain confined to urban centers, leaving rural areas behind. Pakistan’s startup ecosystem is growing, but AI-focused startups still struggle to attract investment.
DeepSeek’s success demonstrates that with the right backing, startups can build competitive AI models without needing excessive funding. Encouraging AI-focused venture capital and startup incubators can accelerate Pakistan’s progress. Currently, Pakistan relies on AI solutions developed by Western and Chinese companies. This dependence makes the country vulnerable to global AI regulations and restrictions. Developing homegrown AI solutions will be critical in ensuring technological sovereignty.
The most important part of DeepSeek’s strategy is its open-source philosophy, offering Pakistan and many other developing nations a huge opportunity. However, OpenAI and Google have largely closed off access to their AI models and DeepSeek has made parts of its technology available for developers worldwide. Local developers, researchers, and startups can leverage DeepSeek’s models to build AI applications suited to Pakistan’s needs.
From Urdu-language AI assistants to AI-powered agriculture tools, Pakistan’s tech community can adapt and localize these models for practical applications. By incentivizing AI research labs to work with open-source AI models, Pakistan can leapfrog some of the challenges associated with developing AI models from scratch. Collaboration with AI researchers in friendly nations, such as China and Turkey, can also provide the expertise needed to create localized AI-driven solutions for governance, education, and healthcare.
DeepSeek’s ability to develop world-class AI tools despite restrictions on access to advanced semiconductor technology demonstrates that a country can compete in the AI space without relying on high-end chips or vast amounts of computing power. By focusing on efficient AI architectures, research-driven development, and education programs, Pakistan can train a new generation of AI engineers.
Countries that fail to invest in AI now risk being left behind in the next phase of digital transformation. Pakistan must act swiftly to bridge its AI gap by increasing government and private sector investment in AI research, expanding AI education at universities, and fostering an innovation-driven ecosystem that supports homegrown AI startups.
Since, DeepSeek has proved that a targeted strategy can challenge even the most established industry leaders, the global AI competition is getting intense. If Pakistan follows a similar path by prioritizing AI literacy, incentivizing research, and fostering international collaborations, it can position itself as a serious player in the AI-driven future. The time to act is now.
Copyright Business Recorder, 2025
The writer is a Research Assistant at Sustainable Development Policy Institute, Islamabad
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