Saturday May 28, 2022

Reaping the IT fruits

April 20, 2016

On August 10, 2015, an article appeared in ‘The New York Times’ about the remarkable progress that Pakistan had made in the information technology sector in the last 16 years.

The article stated “Pakistan’s IT sector is carving a niche for itself as a favored place to go for freelance IT programmers, software coders and app designers. There are now 1,500 registered IT companies in Pakistan, and 10,000 IT gradates enter the market every year. Energetic members of the middle class educated in Pakistan’s top universities, they have honed their skills at the many hackathons, start-up fairs and expos, digital summits and entrepreneurial events at campuses, software houses and IT associations across the country.”

The article acknowledged that IT sales (which were only $30 million in the year 2000) had now gone up to $2.8 billion, of which $1.6 billion represented tech and IT services and software exported abroad. It went on to add that “the Pakistani programmers market ranks as the No. 3 country for supplying – freelance programmers – behind only the United States and India, and up from No. 5 just two years ago....Pakistan’s freelance programmers already account for $850 million of the country’s software exports; that number could go up to $1 billion in the next several months.”

What has caused this remarkable transformation? The seeds were sown back in 2001 when I, as the minister for science and technology (which also had the IT and telecom division working under it at the time), decided to invest massively in IT education, IT infrastructure and promoting the IT industry. The IT policy was formulated and approved within six months of my taking over as the federal minister, thereby laying a clear roadmap. Salman Ansari, adviser to our ministry, played a critically important role in these efforts. Projects worth Rs25 billion were approved by the Ministry of Science and Technology from 2000-2002.

Internet connectivity was expanded from 29 to more than 850 cities and internet bandwidth rates for 2MB/s were slashed from $90,000 per month to $3,800 per month. These were later further reduced to less than $100 per month. Non-robust internet bandwidth capacity availability was increased from 30 Mb/s to 400 Mb/s. Fiber access was expanded from 53 to 250 cities. There were five slots in space for Pakistan’s satellites, but four of these had been lost due to the lethargy of the previous governments and only one slot at 380E was left in space.

A project to have Pakistan’s own communication satellite (PAKSAT-I) was therefore launched and the satellite positioned in the 380E orbital slot was allocated to Pakistan in 2002. This was of strategic importance since a failure to do so would have resulted in the allocation of this slot to India, Israel or another country. Software technology parks with high-speed connection to international markets and modern facilities were set up in Lahore, Karachi, Peshawar and Islamabad. A tax exemption for 15 years was given to software exports in 2001 and software exporters were allowed to retain 35 percent of their earnings in foreign exchange accounts.

All this work on infrastructure facilities and creating an enabling environment would have achieved little without adequately trained manpower. The Ministry of Science and Technology normally does not fund projects related to education in universities. I, however, changed this policy and seven new universities with a primary focus on IT-related education were setup in the public sector. The Virtual University was established in Lahore to provide high quality education in information technology and other fields at very low fees.

However, the foundations of such education must be laid at the school level. So 25,000 school teachers were trained to use IT techniques in teaching, with the kind help of Intel. IT and computer science departments were set up in 34 public-sector universities and 56 public-sector universities were interconnected with each other and with educational institutions around the world, through a national educational intranet project. The concept of endowments for universities had been unknown till then.

In another major change in government policy, endowments of over 1.3 billion were setup for public-sector engineering universities with a primary focus on IT education. An E-Commerce Ordinance was promulgated and projects amounting to Rs208 million were launched in the four provinces and Azad Jammu and Kashmir for the computerisation of government departments, as part of e-government initiatives. Many e-governance programmes were launched and work on a portal connecting 34 divisions was initiated. Computer training was provided to over 15,000 federal government employees through the Pakistan Computer Bureau and the Comsats Institute of Information Technology. Over 1,000 scholarships, to train IT professionals, were also awarded. A project was launched for the IT skill enablement of probationary officers of the civil services academies and a vocational training programme to produce over 100,000 professionals in IT-enabled services was initiated.

Since the IT sector is closely interconnected to the telecommunications sector, dramatic changes were made to expand cellular penetration. There were only 220,000 mobile phones in Pakistan in the year 2000, despite the fact that mobile telephone companies had been operating in Pakistan for over 10 years. There were two major issues that needed to be addressed. First, the calls were very expensive. UFone, a public sector mobile company, was therefore successfully launched, resulting in increased market competition and lower rates.

The second reason for this stagnation was that people had to pay to receiving telephone calls. So the average person was reluctant to keep a telephone for which he or she would have to pay for calls from others. I decided to change that and brought in the ‘Calling Party Pays’ (CPP) regime. The results were beyond our wildest imagination. The demand for cellular phones exploded and 1.3 million new phones were ordered in just one year. This explosive growth continued subsequently, reaching about 150 million phones at present, illustrating how a few sensible decisions can transform an entire sector of the national economy.

The NYT report mentioned above highlights the need for a technocrat government if Pakistan is to progress. In this knowledge-driven world, it is only those countries that are investing in their real wealth (their children) that are moving forward, while others are being left far, far behind.

The writer is Fellow of Royal Society (London), former federal minister for science and technology, and former founding chairman of the HigherEducation Commission.