ON the morning of April 5, 2025, traders at the New York Stock Exchange were glued to their screens as Apple`s stock nosedived nearly five per cent in an hour. Tesla had already fallen 7pc the day before, and Meta, Microsoft, and Alphabet were not far behind. In just three days, nearly $2 trillion in market value was wiped from America`s largest tech firms.

The crash wasn`t triggered by a product flop or a bad earnings report. President Donald Trump had just announced sweeping new tariffs, 10pc on all imports, with steep penalties for key trading partners, including China, India and Vietnam. For Big Tech, which relies on deeply interwoven global supply chains, the blow was immediate and brutal. The markets did not just react; they imploded.

Previous tariff announcements have rattled Wall Street, but this one is different. The scope, timing and targets threaten to fundamentally reshape how global tech operates. This wasn`t just an economic hiccup; it was a structural tremor. Apple`s iPhone, which depends on Chinese and Vietnamese factories, is now caught between rising input costs and collapsing margins. Analysts warn a flagship iPhone could soon cost more than $2,300. And Apple is just one node in a vast ecosystem.

Meta, Google and Amazon also lean heavily on Asian manufacturing for hardware, including VR devices, server racks, even cloud infrastructure. Tesla`s electric vehicles rely on components from India and China. And in the world of AI, where cutting-edge development depends on GPUs and servers often sourced from the same region, the consequences are especially severe.

Tariffs on key computing parts are expected to raise development costs by more than a third, a surge that could cripple smaller labs and delay innovation ateven thelargest ones.

Ironically, while the tariffs are meant to curb China`s tech rise, they may be undercutting America`s own dominance. Big Tech`s strength has long rested on low trade barriers, cheap offshore production and frictionless global logistics. That model is now being dismantled in real time. Investors are no longer just reacting to earnings; they`re questioning the future of anentire industry`s structure.

At a time when the US is racing against China for dominance in AI, the tariffs may be inflicting damage on America`s own momentum. AI development is built on GPUs, servers and high-performance computing systems, many of which are assembled or sourced from Asia. While some advanced semiconductors have been given temporary exemptions, the broader ecosystem has not. Tariffs on GPUs alone are expected to spike development costs by as much as 35pc, which could cripple smaller AI startups and dramatically slow progress at larger labs.

The irony here is painful: in trying to weaken China`s tech rise, the US may end up kneecapping its own, and the market knows it. The $2 trillion erased was most likely a warning shot.

Investors are not just worried about short-term earnings; they are rethinking the long-term profitability of Big Tech`s legacy business models.

The consequences are not contained within the US or China. In developing countries like Pakistan, which import nearly all their consumer tech and depend on global platforms to build digital capacity, the knock-on effects will be swift and severe. When Apple raises prices, when GPUs and cloud infrastructure become harder to source, the tremors reach straight into Pakistani homes, startups, classrooms, and servers.

Already saddled with local import duties and regulatory bottlenecks, Pakistani consumers face even steeper prices for smartphones, laptops and digital tools. But the deeper damage may hit the country`s fledgling AI and tech development ecosystem. Many local developers and researchers depend on access to global platforms, open-source models and affordable compute. As costs soar, those doors begin to close.

This creates a dangerous paradox: just as Pakistan attempts to digitise its economy, integrate AI into sectors like healthcare and education and foster homegrown innovation, the tools to do so become more expensive and less accessible. What follows is not just a tech slowdown, but the risk of falling into deeper digital dependency, reliant on imported AI services and locked out of the development loop.Pakistan, of course, is not a player in the tech trade war. But it is caught in its crossfire. Tariffdriven supply chain shock may feel distant to some, but its results will show up in Pakistan`s stalled cloud deployments, paused AI experiments and shrinking startup runway. And as global companies restructure operations, smaller markets risk being deprioritised entirely.

Yet amidst the disruption, there is a sliver of opportunity. As tech giants look to de-risk from China and diversify their operations, Pakistan could insert itself not by mimicking China`s production scale, but by offering value in other ways. With a young, tech-savvy population and competitive labour costs, Pakistan can position itself as a digital services and backend talent hub for overstretched AI labs and global startups. But this won`t happen by default.

To seize this rather narrow window of opportunity, Pakistan needs to invest urgently and seriously in its human capital. That means prioritising technical education, scaling AI training programmes and subsidising access to computing infrastructure for universities, startups and freelancers alike. Without these fundamentals, the country risks becoming a spectator to a race it should be trying to run in.

Of course, all of this would require actual digital policymaking; something far more ambitious and conducive than criminalising misinformation through the Prevention of Electronic Crimes Act and suspending X. If we want to be a part of the global tech shift, we will have to do away with predatory laws and vague digital agendas.

We need policies that enable infrastructure, promote learning and encourage innovation. As opposed totreatingtheinternetasathreattobe contained, we need to look at it as a platform to be built upon.

Disruption is destabilising, but it also clears the way for new alignments. If the global tech order is being reshuffled, countries like Pakistan may have a chance to find new footing. The window may be narrow, but the cost of inaction is far wider.• The writer is the founder of Media Matters for Democracy.