The database includes criminals' fingerprints, ID cards, cell phone numbers, criminal charges, photos and other details.
The objective of the policy is to raise the quality of governance, provide advanced training to youth, digitise the economy and improve access to secure and fast internet connectivity.
Banks operating in Pakistan have started to conduct biometric verification of account holders, meant to weed out phony accounts and to contain money laundering.
The new initiative aims to reduce the incidence of theft and use of unregistered phones in terrorist activities and other crimes.
Equipping children with modern technology skills and education is a top priority of the Khyber Pakhtunkhwa government, officials say.
Illegal mobile phones are often difficult to trace and used by criminals and terrorists, officials say.
Authorities are taking action against proscribed groups that use social media for recruitment and radicalisation.
Police and other security agencies need counter-terrorism training, officials say.