April issue 2015
Light in the Dark
Given the amount of negative attention that Pakistan receives on a regular basis, it may seem to many that the path for Pakistani industries — like the country’s overall situation at the moment — is a difficult one.
However, beyond the media haze lies a different reality, one that has consistently defied everything you might have come to learn about this South Asian nation of 190 million people.
For local and foreign investors alike, Pakistan is a massive market with unbelievable potential — potential that more savvy investors are already cashing in on. Several sectors of the country’s economy have made incredible headway in a short amount of time and others are following suit, establishing themselves as major avenues of investment.
Let’s put Pakistan in perspective before we go any further. It is bordered by the People’s Republic of China to the north, arch rival India to the east, war-weary Afghanistan to the west, sanction-bound Iran to the southwest, and the Arabian Sea to the south. For the better part of two decades, it has been plagued by an armed insurgency and recently saw a tense political stand-off unfold in the heart of its federal capital. From afar, this hardly seems to be the ideal setting for businesses to thrive in.
Yet thriving they are, for a variety of reasons, none of which unfortunately make global headlines very often. Chief among these reasons is a young population, with over 100 million people aged below 30.
This puts Pakistan at a major advantage in an increasingly globalised world where technology, entrepreneurship and innovation are highly valued and equally well-rewarded. One could go so far as to say that Pakistan is poised to be at the helm of a sea change in the way the global economy operates, because its vast millions of young people are neck and neck with their counterparts around the world in terms of entrepreneurial prowess. And when you’re neck and neck, numbers suddenly take on a whole different meaning.
Consider this: 100 million people in Pakistan are at a point in their lives where they are to decide what they are going to do for a living. Increasingly, the answer to this question is not a steady 9-to-5 job at a multinational corporation, but an entrepreneurial venture of their own. This brings us full circle to the potential of the Pakistani market.
At the moment, only a handful of the country’s industries have hit saturation point, while the rest are wide open for new entrants. The demand for services and goods once unheard of is now astonishing. For instance, a decade ago the Internet was painfully slow and a luxury not many people cared for or had access to. Today, it is the backbone of a massive IT and e-commerce industry that has the potential to propel Pakistan to the forefront of the regional technology race.
If the media haze were to be believed, it would also come as a shock to many that Pakistan enjoys a high rate of mobile phone usage — 76.2 per cent of the population to be precise — not to mention some of the cheapest mobile telephones you will find anywhere in the world. With the introduction of 3G and 4G services, mobile Internet usage has also gone up significantly.
In short, this is a market ripe for investors to jump in with both feet, and many are doing just that, despite a few challenges along the way, such as unreasonable censorship of various websites. Facebook was briefly banned in 2010 by the Pakistan Telecommunication Authority (PTA) because of blasphemous content, and YouTube still remains blocked in Pakistan for similar reasons.
However, this problem is not limited to Pakistan. Internet censorship is also a major issue in China, where the government uses particular technology, colloquially known as the ‘Great Firewall of China,’ to limit its citizens’ access to the web. In Pakistan, these bans have spurred reactions from online organisations such as Bolo Bhi, which is a registered, non-profit, civil society organisation working for digital freedom and the promotion of Internet transparency in the country.
Regardless, however, Pakistani IT entrepreneurs have largely crafted their own story. In the absence of global online retailers such as Amazon, homegrown brands like Shophive.com and Homeshopping.pk gained prominence with solid catalogues and a cash-on-delivery payment model. PakWheels.com became a massive forum for everything that had to do with cars, and car enthusiasts flock to it by the millions to this day. News websites like UrduPoint.com and ProPakistani.pk are busy catering to a huge audience hungry for Pakistan-focused content. All of these websites have something in common: they are all unabashedly Pakistani and they are all, without exception, highly popular.
Another excellent example is the country’s top real estate portal, Zameen.com, and this is a very interesting example indeed. The following of this native brand is so massive and loyal that new entrants into the market — some of whom are backed by international giants and have funds to spare — are meekly following its lead for the most part.
But the point to be taken away from all this is that international giants are now noticing Pakistan and are making strategic investments in its economy. Both Zameen.com and PakWheels.com have recently landed sizeable investment deals with Singapore and Malaysia-based venture capitalists. Another local start-up, Shopistan.pk, has received funding from Kima Ventures, an international organisation run by entrepreneurs seeking to provide funding to innovative newcomers who are still in the seed stage of their businesses. There are hundreds of other success stories out there as well.
So in this oft-maligned nation — where, as the world media would have you believe, there is only suffering and strife — you can practically put together an entire life sitting on your computer if you so desire. Just like you would be able to anywhere in the ‘developed world.’ Find a car, rent a place, furnish it, buy gadgets and clothes, sit back and consume awesome content on said gadgets while wearing said clothes. This is modern-day Pakistan.
Let’s come full circle once again. A fascinating fact about all of these companies is that even though they are now gaining international exposure, their inception took place on a very small scale without much funding. While they have evolved into giants of the local IT industry, they all had humble beginnings.
Apply this potential to 100 million youngsters hungry for success and the media haze lessens further. Hopefully, what we will see when our eyes adjust to this new-found reality is a fairly bright future for Pakistan, and that is what should be making headlines.