Is Pakistan destined to be a Silicon Valley?

Country needs tech firms much more than food joints

ISLAMABAD: In the early ‘70s, a Bangalore-based engineer envisioned his beloved city becoming a Silicon Valley of India. The core behind this idea was the establishment of a dedicated electronic city for technology companies.

Vision is never easy to sell. RK Baliga, the dreamer, was lucky enough to have a patron in the shape of Devaraj Urs, Chief Minister of Karnataka. Despite resistance from various quarters, Urs approved and fully supported the project.



In 1976, the foundation was laid for the 332-acre Electronic City near Bangalore. The Karnataka state government provided the initial seed money for the project. At present, the Electronic City is the largest cluster of technology companies in Bangalore with over 300 firms.

The story of Bangalore is not that linear. Various factors worked in its favour, such as a moderate climate, central location, concentration of public engineering firms and presence of high-quality educational institutions. Indeed, it is a combination of these factors that forms an ecosystem conductive for the Silicon Valley in the making.

Baliga’s dream was just an ignition for the start of a structural journey. The support of Karnataka political leadership remained crucial for its sustenance and subsequent success.

In August 1985, Texas Instrument established a research and development (R&D) facility in Bangalore and became the first global technology company to create a presence in India. In the 90s, a joint venture between the Singapore government and the Karnataka state government led to the setting up of the International Tech Park in Bangalore.

With each passing year, Bangalore is becoming more attractive for international tech investments in software, business process outsourcing and even hardware.



A city of 12 million inhabitants, Bangalore has a 31% share in total Indian IT exports of $85 billion, a whopping $26 billion in comparison to total Pakistan’s exports of $20 billion.

A number of Fortune 500 companies have their development centres and R&D facilities in Bangalore. Top Indian IT companies such as Wipro and Infosys have their head offices there. Even Chinese are not lagging behind as Huawei Technologies has established its largest global service centre outside China in Bangalore.

However, Bangalore is not without its own set of problems. Rapid expansion over the last two to three decades is extracting its cost in terms of environmental degradation.

With increased concretisation, its reputation as a garden city is diminishing. The city’s broader infrastructure may not be considered as of world class. However, struggle is on by the state government and the buoyant private sector to sustain its livability and maintain its lead as the IT hub of India.

Building a niche

What lessons lie in the Bangalore story for Pakistan? Despite the ongoing enemy rhetoric by public figures and corporate media of both countries, we need to think dispassionately to deduce meaningful lessons from the Bangalore model.

There is indeed a humongous gap between the Pakistani and Indian IT economy. The reasons could be numerous from economic, technical to political. Catching up is not the issue, but building a niche is a task.

The question is whether Pakistan does have a spatial space for a Silicon Valley. Lahore and Karachi are the main IT hubs in Pakistan, but their spatial look does not give a feel of Silicon Valley.

However, Islamabad, the beautiful, does offer the endowments in terms of its excellent weather, topography, public engineering firms and technical educational institutions. Initial impetus for the Silicon Valley in northern California and Bangalore came from defence contracting and public engineering firms. Islamabad’s case cannot be much different.

Expat-friendly

Technology remains an arena of ideas and scale. We need to work on scale first, where cheap brains will be the principal comparative advantage.



Pakistani IT companies are striving, however, high cost of business and security perception remain major impediments. How can a nascent startup or even mid-level company afford the rental value of real estate in Islamabad? We need domestic technology companies much more than food joints from employment and wealth creation perspectives. Pakistan has to aim vigorously at making its working and living environment more expat-friendly. We need to answer honestly whether we can offer a fun environment as present in Silicon Valleys of the West and East.

If not, then our gullible population should be informed that we remain destined to the peripheries of global innovation. It is time to think hard and decide harsh.

The writer is a director at the Policy Research Institute of Market Economy

Published in The Express Tribune, October 17^th, 2016.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.