- To stay competitive in the 4th industrial revolution, characterised by the integration of advanced technologies, Pakistan must revisit its education system
The current global economic downturn in 2022-23 is expected to have a profound impact on startups, creating numerous challenges and obstacles to growth and success.
Many startups rely on venture capital funding, which has become scarce in recent times due to investors being more cautious with their investments. This shortage of funding is a major challenge for startups and can lead to the delay or even termination of projects. The economic downturn has resulted in a decrease in consumer spending, causing a decline in demand for goods and services offered by startups. This has led to decreased revenue and profits, putting additional pressure on startups that are already struggling to survive.
The job market has become more competitive as the number of people seeking employment has increased, making it difficult for startups to attract and retain the best talent. The cost of hiring and maintaining employees has also increased, putting additional financial strain on startups.
Factors like uncertainty and unpredictability of the global economic situation have made it difficult for startups to plan. Businesses are hesitant to invest in new projects or expand their operations, leading to decreased innovation and progress in the startup world. This presents several challenges for startups across the world including Pakistan’s emerging startup scene.
Despite these difficulties, Pakistani startups must remain resilient and adapt to the changing circumstances by being creative, innovative, and proactive, and can overcome these challenges and thrive in the long run. That however will not be possible unless the Government and its relevant institutions take urgent measures to support the innovation sector in Pakistan.
Pakistan has a young and vibrant population with 65% of its citizens below the age of 35, making it a fertile ground for cultivating a thriving startup ecosystem.
Startups and small businesses play a vital role in driving economic growth by creating job opportunities, fostering innovation, and attracting foreign investment. By creating a supportive environment for startups, Pakistan can help its young entrepreneurs overcome the challenges they face and position the country as a hub for innovation and entrepreneurship.
The government must play a critical role in supporting its startup ecosystem by offering incentives, enabling connectivity, facilitating funding for research and development, and implementing a favourable regulatory environment.
The government can also encourage collaboration between startups, academia, and the industry to foster an exchange of ideas and knowledge, driving economic growth in the process under the triple helix model of innovation.
Pakistan can also draw numerous learnings from the successful startup ecosystems such as Dubai Internet City, India, and China. These countries have created a supportive environment for entrepreneurship and startups, leading to the growth of innovative and successful businesses.
By adopting similar policies and creating a conducive environment, and by facilitating G2G and B2B partnerships with international organizations, Pakistan can foster innovation and drive rapid economic growth.
To stay competitive in the 4th industrial revolution, which is characterised by the integration of advanced technologies such as AI, robotics, sustainability, carbon-neutral energy and the Internet of Things into the economic value chains, Pakistan must revisit its education system.
By teaching technology skills at the high school level and offering technology-centric vocational education and 2-year degree programs, Pakistan can quickly create a future workforce that is ready for the demands of the 4th industrial revolution. This investment in human capital through education and training will position the country to take advantage of the opportunities presented by the 4th industrial revolution and drive economic growth.
Connecting young women in rural areas to boot camps, skills development programs, freelancing, and the entrepreneurship ecosystem can also have a significant impact on the economy. By providing access to resources, skills and knowledge, young women can participate in the digital economy, increase their economic footprint and contribution, and provide a source of income for themselves and their families. This can leverage the potential of young women to drive economic growth and address gender inequality in the national workforce structure.
Re-orienting academia towards developing R&D-led Startups can help Pakistan create a cutting-edge technology ecosystem and support the startup ecosystem in the country to gain a competitive edge in the global market.
By aligning academic research with the needs of the startup ecosystem, universities can provide a strong foundation for the development of new products and services, attract foreign investment, and create new job opportunities. For this to happen, key reforms are required including permitting academia to register and operate their startups and to engage in business activities while retaining their positions in universities. This could also create a new revenue stream under the equity-sharing model for universities and R&D centres, increasing their financial viability.
It is only by focusing on key areas such as talent acquisition, access to funding, and creating a supportive regulatory environment, and by learning from the successful startup ecosystems in other countries, Pakistan can create a thriving and resilient startup ecosystem.
The government and academia can play a critical role in supporting the Startup ecosystem, driving innovation, and creating a more prosperous future for its citizens. It’s a vision that cannot be realized unless a sea change in national decision-making takes place, paving way for all verticals of the technology industry to weld into a common horizontal, to resolve challenges and seize emerging opportunities.
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