Big cities may be tempting targets for new startups, but it is often smaller towns that offer fertile ground for opportunity and innovation

Let’s say you are a considerably young budding entrepreneur with not much experience in the realm. Traditional wisdom would have it that looking to big cities like Karachi and Lahore, with their gargantuan levels of economic activity, would be your best bet to start a nascent business. Or so would you think.

The findings of a research conducted by the Centre of Entrepreneurial Development at the Institute of Business Administration (CED-IBA) Karachi beg to differ. According to the study, titled GEM-Pakistan Report 2011, the number of individuals expected to start their own businesses was highest in Khyber-Pakhtunkhwa and Balochistan, as compared to Punjab or Sindh.

While Punjab possessed the highest number of established business owners and traditionally possessed the highest early stage business survival rate and a low business closure rate, it was Balochistan – Pakistan’s poorest province – that reported the highest nascent entrepreneurial activity. K-P, meanwhile, possessed the lowest business closure rate in the country along with the highest level of opportunity-based entrepreneurship, according to the report.

Curiously enough, these developments somehow took place despite both provinces facing the bulk of militant violence over the past two decades.


For Umar and others like him, the country’s future lies in entrepreneurship. “As things stand, there are limited jobs in Pakistan and few of them are ‘fulfilling’ for young professionals,” he said. “Youngsters in large numbers are already opting for entrepreneurship and this trend will only grow in coming years.”

“Pakistan is among the richest in the world in terms of human resource,” noted Pakistani-Canadian real estate entrepreneur Rana Gulzar Ahmad. “This in itself creates huge potential for development in the country.

But despite huge potential, entrepreneurship is far from an easy road in the country. “I encountered a lot of challenges in my five-year journey,” admitted Umar. “The biggest one, for me, was ‘market ignorance’. A lot of people simply were not aware about how modern technological solutions could impact their lives and livelihoods.”

According to Umar, this lack of awareness made it hard for him to assemble a skilled workforce. “In cases where we were able to scout some talent, it was hard to retain them in a place like Abbottabad due to brain drain towards major cities,” he said.

The executive director of Centre for Peace and Development Initiatives (CPDI), Mukhtar Ahmad noted that small industry in Pakistan suffers from excessive and inefficient regulatory requirements. “Processes and criteria for regulatory approvals need to be simplified and made homebound,” he said. “We also need more dedicated areas for small industries and entrepreneurs, where all basic facilities exist and are able to benefit from synergies with others located in the same vicinity.”

Meanwhile, Lahore-based entrepreneur and author Khalid Rasool pointed out that attracting investment from both local and foreign sources continued to be a huge challenge. “We need to improve our planning and implementation capabilities to world-class standards,” he said. “At present, most of our industrial estates – there are 72 in total in the country – are operating far below their capacity.”

Rana Gulzar acknowledged that early investment opportunities opportunities were missing or rare in Pakistan. However, he believed China-Pakistan Economic Corridor projects, like the Gwadar Port, do provide ample opportunity for both local and foreign investors. “The Gwadar Port motivated me to invest in Pakistan,” he said. “Since it was established, I have spent six months each in Pakistan and Canada. And although Pakistan currently shows a negative investment trend, CPEC projects will be a silent gamechanger for the country’s economy,” he added.

According to Rana, the agriculture sector will get a significant boost in the next two or three years. “Already both the Chinese and Japanese are showing great interest in this realm,” he said. He also saw huge potential for tourism-related investment in Gwadar and Gilgit-Baltistan.


According to Umar, the Pakistan government needs to provide incentives to local businesses, such as by offering tax rebates. “The registration process for startups should be made easy, and training and incubation centres should be established along with making knowledge of licensing, import and export procedures widespread,” he said.

“It only takes a day in many countries, such as New Zealand, to set up a company,” Umar pointed out. “This is due to simple registration procedures and widespread awareness,” he said. “Here, however, the common citizens has no clue about how to register a company. And for those that do, the process is lengthy and requires a lot of paperwork.”

“If an applicant meets all requirements, approvals for new businesses should not take a lot of time,” said CPDI Executive Director Mukhtar. “The government needs to adopt small business-friendly policies along with greater investment in support.”

Umar said budding entrepreneurs in Pakistan have limited financing options as well. “We need a wider selection of banking products to ease the process of setting up new businesses.”

Malaysia-based digital forensics expert Dr Kashif Nisar said Pakistan must establish a cyber-city to keep up with the global digital revolution. “Better power generation and internet services are a must to reshape the country’s economy in line with the ‘fourth industrial revolution’ which combines smart devices, big data, machine learning and 3D printing,” he said.

Umar agreed, saying the government needs to establish centres for high-tech entrepreneurial activity along the Silicon Valley model.

That said, Umar advised would-be entrepreneurs to be determined, resilient and consistent, no matter the odds. “Whatever setbacks you face, you need to continue to pour blood and sweat in order to achieve your goals,” he said. “Being your own boss creates the risk for complacency, so you need to ensure you stay motivated and consistent. Success will follow.”