Tech boom prospects

While it is still too early to predict if a tech boom is coming, most of the requirements for one are in place.

A new report by German broadcaster Deutsche Welle has shined a hopeful light on Pakistan’s potential to produce successful tech startups. The story highlights Pakistan’s relatively cheap labour as a key benefit while highlighting how Careem was one of the big companies to ‘start out’ in Pakistan. Though the company — bought by Uber for over $3 billion last year — was technically based in the UAE, the initial coding for the service was done in Karachi. Pakistan was also named one of the fastest-growing economies in Asia in McKinsey & Co’s latest report on the Pakistani ecosystem, with 720 startups created since 2010.

Although some refer to the rise of the tech sector in Pakistan as “organic” — meaning governments past and present can’t really take credit — increasing investment potential was credited to the incumbent government for bringing political stability and reducing corruption. The story notes that Pakistan’s tech economy began growing at the same time as many others in the world, but it is today one of the few things in the economy that is working — raising investment as other industries look increasingly risky. In recent years, Pakistan has seen a few other notable investments flow in, including from China’s Alibaba Group, which bought Daraz for around $200 million, and various venture capital firms.

The story notes that although startups in Pakistan only raised a meagre $18.8 million in total funding in 2019, this figure is expected to increase significantly. Egyptian ride-hailing company Swvl alone plans to invest $25 million in Pakistan over the next two years. The government’s future plans were also credited with increasing interest in Pakistan. Prime Minister Imran Khan has made a hard push to encourage investment in the tech sector, most notably with the government’s “Digital Pakistan” initiative. While it is still too early to predict if a tech boom is coming, it can reasonably be said that most of the requirements for one are in place.

Published in The Express Tribune, February 6^th, 2020.

Like Opinion & Editorial on Facebook, follow @ETOpEd on Twitter to receive all updates on all our daily pieces.