Daily Times

Entrepreneurship is the
backbone of any economy and Pakistan’s is no different. We are seemingly a nation of entrepreneurs — from a small-scale farmer in Bhakkar to businessmen like Mian Mansha and Syed Babar Ali — brimming with people who build capital through risk and initiative, yet our economy seems to be in dire straits all the time. Without taking credit away from ‘sustenance entrepreneurs’ (the farmers, street hawkers and small shop owners) for supporting our economy, I believe that we need to foster a new breed of innovation- and growth-focused entrepreneurs who can venture into high-growth businesses that provide long-term and sustainable returns to stakeholders to make a disproportionately positive impact on the economy in the process. Educational institutions are clearly falling short of fulfilling this need with their dearth of focus on entrepreneurship and, as a result, are churning out code jockeys and business graduates with a mission to hop from one job to another to make a couple thousand extra.

Given that backdrop, it was encouraging to learn about a string of initiatives in various stages of execution by the government of Punjab. For Chief Minister (CM) Shahbaz Sharif, who usually gets a lot of flak for lack of strategic planning, these initiatives are very well thought out and complement each other to support his vision of promoting IT entrepreneurship and a knowledge-based economy in Punjab.

The first of these is now a long-running programme titled ‘Punjab Education Endowment Fund’ (PEEF), which gives financial grants to underprivileged students to support their education at leading educational institutions. Last year alone, 12,500 scholarships, amounting to a disbursement of Rs 770 million, were given to students from mostly southern Punjab to pursue their secondary, intermediate, graduation, masters and foreign degree education. This year the disbursements were raised to Rs two billion. A large, albeit raw, pool of educated knowledge seekers is the foremost prerequisite to seed the rest of the programme; PEEF ensures that the underprivileged citizens of Punjab comprise as much of this pool as the privileged few who can afford education at good institutions.

The next initiative is the launch of the Information Technology University of Punjab this fall, a contemporary university designed from the ground up to serve as a model institution where students are trained with an acute focus on inculcating the spirit of entrepreneurship and innovation. The initial focus is information technology (IT) as the name suggests, but from what I have gathered from discussions with the people behind this venture, the real aim of the university is to produce entrepreneurs and innovators.

Based on discussions with various stakeholders in the government, I understand that there are three primary reasons for the government’s choice of the IT industry for this entrepreneurship drive. First of all, given the severe energy crisis in Pakistan, the IT industry has very little dependence on energy, fuel or electricity. Secondly, the capital requirements for bootstrapping an IT company are far less than most other industries. And, lastly, the IT industry has the most potential for generating disproportionate returns on investment and effort. Fortune magazine recently published a list of the 12 greatest entrepreneurs of our time and more than 50 percent of these entrepreneurs belong to the IT industry.

Getting back to the strategic programme, the third initiative is to equip the students who have shown promise during their education with tools of the trade so they can give shape and form to their dreams and ideas. 200,000 laptops have been awarded to students based on transparent, merit-based qualification criteria primarily based on the results of the board examination. These laptops do not just provide a platform for young graduates to build innovative IT applications, they also open doors for access to the worldwide web of knowledge and information to further refine their minds. I personally know many young men and women who are using these laptops to attend online courses on artificial intelligence by Stanford professors and others who are building GIS-based applications to do flood modelling and predict natural disasters.

So what do these young, enterprising individuals do if they are inspired to solve a problem through the use of IT? Where do they go? Who can guide them? Who can help them bootstrap a small company and groom them so they are ready to scale a global IT-driven business? All these questions are addressed by the Plan9 Business Incubator launched by the Punjab Information Technology Board in September this year. An independent board of advisers at Plan9 carefully screens and selects promising young ventures and provides them with a fully furnished office space, all administrative services, access to a cloud-based computing infrastructure, provision of local and international mentors who have built successful IT businesses before and, most importantly, exposure to local and international venture capital investors as they graduate in the hope that some, or even one, out of these become the next Google, Amazon or eBay of the world and flip Pakistan’s balance of trade on its head. Inductions for the first Plan9 batch are being completed as you read this.

The companies that graduate out of the Plan9 incubator will need access to capital to tap into the worldwide market for their products and services. The Punjab government has been advised to consider developing a framework to support a local venture capital industry to fund local businesses at the earlier, higher risk stage and pave the path for subsequent foreign investment into these ventures. Proposals to provide either a down-side protection to privately managed venture capital funds along the lines of the small business investment companies model in the US or to provide pre-negotiated, equity buy-out options for an enticing up-side for these funds along the lines of some Middle Eastern models are under consideration by the government.

Once this last initiative is announced, it will complete one of the most ambitious, strategic and integrated programmes of the government of Punjab to support the development of an IT-driven, entrepreneurial ecosystem in the province that can result in tremendous wealth and job creation opportunities in Punjab and a simultaneous increase in government revenues, which can be funneled back into other development initiatives.

Khurram Zafar is currently the Chief Information Officer at a leading capital markets institution of Pakistan