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” and fit the definition of the term as per Wikipedia, yet our economy seems to be in dire straits all the time! Without taking away any credit from the ‘sustenance entrepreneurs’ – the farmers, the street hawkers, and the 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 its stakeholders and make a disproportionately positive impact on the economy in the process. The educational institutions are clearly falling short of fulfilling this need with their absolute dearth of focus on entrepreneurship, save for a course or two, and as a result churning out code jockeys and business graduates with a mission to hop from one job to another that pays 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 a Chief Minister 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 long-term vision to promote IT entrepreneurship and a knowledge-based economy in Punjab.

An integrated program by Punjab government to promote entrepreneurship

The first of these is now a long-running program titled Punjab Education Endowment Fund (PEEF) that makes financial grants to under-privileged 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 out to students from mostly Southern Punjab region to pursue their secondary, intermediate, graduation, masters and foreign degree education. This year the disbursements were raised to Rs 2 Billion. A large, albeit raw, pool of educated knowledge seekers is the foremost pre-requisite to seed the rest of the program as detailed below, and PEEF ensures that the under-privileged citizens of Punjab comprise as much part of this pool as the privileged few who can afford education at good institutions.

The next initiative is the launch of 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 in them. The initial focus is Information Technology as the name suggests, but from what I have gathered from discussions with people behind this venture, the real aim of the university is to produce entrepreneurs and innovators.

It is pertinent to segue here to briefly question the Government of Punjab’s focus on IT. Based on discussions with various stakeholders in the government, I understand that there are three primary reasons for Government’s choice of the IT industry for this entrepreneurship drive. Firstly, given the severe energy crisis in Pakistan, Information Technology industry is among the very few that have very little dependence on energy, fuels 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% of these entrepreneurs belong to the IT industry!

Getting back to the strategic program, the third initiative is to equip the students, who have shown promise during their education, with the tools of the trade so they can give shape and form to their dreams and ideas. 200,000 laptops were awarded to students – 100,000 in 2011 and another 100,000 in 2012 – based on a transparent, merit-based qualification criteria primarily based on the results of the board examination. I consider this akin to gifting a Dewalt Power Tools set to promising graduates of a carpentry school except that these laptops do not just provide a platform for young graduates to build innovative IT applications on, but they also open the doors for access to the world wide web of knowledge and information on the internet that can further refine and sharpen these young minds. Can they be misused, or not used at all? Yes, but the intended benefits and pros far out-weigh the cons in my opinion. I personally know young men and women who are using these laptops to attend online courses on artificial intelligence from Stanford professors and others who are building GIS based applications to do flood modeling and predict natural disasters.

So what do these young, enterprising individuals do if they are inspired to solve a problem through the use of Information technology? 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 into a global IT driven business? All these questions are addressed by the Plan9 Business Incubator launched by Punjab Information Technology Board in September of 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 – all at no cost to these young entrepreneurs – with a hope that some, or even one, out of these could 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 I write this article.

The companies that graduate out of the Plan9 incubator, will need access to capital in order to scale and tap a world-wide market for their products and services. The Government of Punjab has been advised to consider developing a framework to support a local venture capital industry that can fund local businesses at 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 Small Business Investment Companies model in the United States 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 programs 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.

A slightly modified version of this article titled VIEW : Promoting IT entrepreneurship in Punjab was also published by the Daily Times newspaper on October 10, 2012.