Building the Innovation Economy

By Shahjhan Chaudhary

When LMKT reached out to me to lead the National Incubation Center in Karachi, I was skeptical.

It is funded by the government, will be managed by a consortium of private sector entities and will be housed in a public university. Being answerable to the Board and to our funding organization, IGNITE, how can I build the innovation economy?

I did due diligence on LMKT and LMKR and Ignite. I researched National Incubation Centers in Lahore (LUMS) and Islamabad (Mobilink) and . NED University where NIC was going to be housed.

With all the possible pitfalls, it was too good an opportunity to pass. The parallels to Silicon Valley were obvious: Stanford University was getting funding for research from various government agencies, they built the Stanford Research Park to commercialize this research, and so started what became Silicon Valley with multi-billion-dollar companies like Apple and Google and Facebook.

Karachi is Pakistan’s largest city and commercial hub. It has its challenges, but it is home to probably the largest number of young people in a city. Karachi needs not just an incubator, but tens of technology community hubs where young people can come together and discover opportunities. Opportunity is the spiritual equivalent of hope, which is a driver of progress and growth.

The 20,000 sq ft NIC Karachi is one small step in the right direction. As a next step, we need to think in terms of such spaces available at low-cost, in parts of the city where young people can freelance for global clients, start small service companies and build startups.

Critics of this approach raise questions like efficacy of incubators. They also question the the success ratio of startups that go to an incubator If we want to make Karachi the innovation capital of South Asia, with millions of young people serving global clients, building products, solving national problems with technology – we have to dream with a generous heart. We toned to think big and work in an integrated manner to achieve this goal. We need 100 sq ft of space per person. If we want 1 million people to be involved in the global innovation economy, we need 100 million sq ft of space.

While Karachi has millions of young population, they lack the required skills. Our educational institutions do not have the capacity to train 1 million young people in the next 5 years. This is a single largest obstacle to making progress. Technology hubs that provide low-cost space to young people will become centers of both innovation and learning. These technology companies should also be engaged by the government to deliver skill development content. The world that we live in demands that we not only learn but also unlearn and learn new things on an ongoing basis. We’re an accelerator, but rapidly becoming a community hub for young techies. But without sustainable funding and support, we cannot accelerate the process of becoming globally competitive – not for Karachi or anywhere in Pakistan. The establishment of NICs in major cities of Pakistan have provided space, mentoring and networking facilities to young entrepreneurs that has helped to usher a wave of entrepreneurship in Pakistan.

But why should the government invest and enable this innovation ecosystem? A freelancer earns $18,000 per year on average. With a million people engaged in the global economy, Karachi can potentially export $18 billion dollars of digital services. The return on innovative products is promising.

In order to realize Karachi’s technology potential, the city needs Special Technology Zones that can provide affordable space and other related services in the center of the city. The second most important issue is to enhance the scale and scope of venture funds in Pakistan. Lastly, judicial and taxation’s systems need to be modernized to understand the intellectual property rights and other dynamics of knowledge economy.

As a committed Karachiite who has seen the ups and downs of this city, I ask all well-wishers of my city to come together and invest in our youth and the future of our city. It is important because the City of Lights needs a break, our youth need hope and to build a successful Pakistan, the country needs a thriving Karachi.

Shahjhan Chaudhary is the Director of the National Incubation Center Karachi.

3 Comments

  1. Ayesha Bilal says:

    Well said. Innovation can be a driver for future growth of our country. Not only is there a lack of institutions but unfortunately also a lack of teachers/trainers/professors owning to massive brain drain. How can we stop young people getting training or technical education from going abroad so they can invest their time to innovate in Pakistan?

    • Shahjahan Chaudhary says:

      While I used to believe in the “brain drain” theory – I have reversed my views. We need to rapidly produce and export tech talent around the world. Without connecting Pakistan’s innovation economy to global tech hubs – we cannot accelerate our exposure or growth.

      We should also solve the challenges facing entrepreneurs and innovators locally to build our capacity for growth and global orientation.

  2. Yusuf says:

    Well written. Addresses major issues and questions and is heartfelt. Would be good to maybe mention outcomes of NICKarachi to date? Also Ignite funds but also designed the program based on a study of why incubators have failed or succeeded around the world since 1965. The RFP and contract manifested this design and principles.

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