The way forward: Research, innovation

Pakistani youth lack awareness about cutting-edge technologies

KARACHI: To understand the deep-tech or cutting-edge technology startup ecosystem and its funding in Pakistan, it is important to compare the development of such startups with the developed countries such as the US and India, said Mutaher Khan, co-founder of Data Darbar.

“The deep-tech startups in the US mostly originate from the universities. If we look at the biotech pipeline in the US, most of these ventures start from the universities such as Howard and Massachusetts Institute of Technology (MIT),” he added.

The extensive academic research in these institutions made a cluster for the startups to thrive, while in Pakistan, there is a lack of such research in the universities, he remarked.

“The students in these US institutions, whether graduates or PhDs, instead of going to the realm of academia, patent their ideas and build their startups, as they are provided with the required research, development and advanced inventions,” Khan said.

Despite enormous input on this front, the major funding in the US goes to traditional sector startups such as fintech, ecommerce, software and logistics, he added.

For Khan, deep-tech attracts less funding on a global level, compared with other sectors. In terms of distribution of money, the sector does not have a large portion, compared with other startups.

“Say, if a country attracts $300 billion in total funding, of which a tenth or $30 billion goes to deep-tech, then it is meaningful money,” he added.

The lack of interest and know-how regarding the deep-tech on the venture capital front also contribute to the comparatively low funding in the cutting-edge technology, as these funds opt for strategic investment.

According to Khan, most of the notable venture capital funds usually incubate the idea or invention and from there these startups generate funds.

The lack of training and knowledge about the cutting-edge technologies such as artificial intelligence (AI), blockchain, artificial reality (AR) and others, remain a key to the less number of such startups in Pakistan.

Syed Azfar Hussain, project director at the National Incubation Centre (NIC), Hyderabad, said that building cutting-edge technology products remains a distant dream in Pakistan, as the developers and experts in the country usually work for foreign companies on a freelance basis.

“Besides, the people working on such technologies are mostly involved in outsourcing, where foreign companies outsource the local freelancers to do the job,” he added.

“Given the circumstances, it is very tough to make a cutting-edge technology product, as the local developers lack the will and resources to lay the foundation of such products,” Hussain remarked.

Even if the founders somehow make a product, they find it difficult to raise funding to expand their operations, owing to the chaotic economic conditions of Pakistan, he added.

For Hussain, the role of the educational institutions’ is of much significance in the training and creating awareness among the youth, besides carrying out advanced research to achieve success.

“The problem lies in the education sector of the country, especially the universities, which neither have vision, nor the will to develop aspiring developers or facilitate them during their education,” he said.

In comparison with Pakistan, India has achieved significant success on cutting-edge technologies, as the country is home to around 450 Web3 startups, of which four are unicorn companies.

Around 60 per cent of the Indian Web3 startups have become global as far as their operations are concerned, according to a report released by the National Association of Software and Services Companies (Nasscom), a non-profit organisation in India.

The neighbouring country’s Web3 ecosystem has touched $1.3 billion in funding till April this year. Currently, it possesses 11 per cent of the world’s Web3 talent.

The figure makes India the world’s third-largest Web3 workforce, employing nearly 75,000 blockchain professionals today.

The Middle East and North Africa (MENA) Region continues to be one of the fastest growing hubs for cryptocurrency adoption with the launch of a crypto-focused association in Abu Dhabi’s Free Economic Zone.

The Middle East, Africa and Asia Crypto and Blockchain Association (MEAACBA) was officially launched on November 8, 2022 in the Abu Dhabi Global Market (ADGM) with the goal of facilitating the development of blockchain and crypto ecosystems across the MENA Region.

Likewise, globally, the estimates of the artificial technology market size have varied but most point to a double-digit growth forecasts over the coming years, with some analysts forecast it to $309 billion by 2026 from $299 billion, at present, a report by the Saudi management consultancy firm, Strategic Gears, showed.

The AI software, including virtual assistants and chatbots remains a major driving force of the overall market. The cutting-edge technology is also gaining traction in the Middle East and North Africa (MENA) Region, it added.

While recent technological advancements have made AI more accessible than ever before, the regional governments and businesses are beginning to see the significant benefits of AI for their national objectives and business models.

The governments in the region are promoting this shift as part of their efforts to develop knowledge economies based on digital technology.

Given their large youth population, many MENA nations are making significant investments in AI education, training and research to ensure that such technologies play a key role in the future economy and workforce.

Roughly three quarters of the Saudi Vision 2030 goals involve data and AI and the kingdom plans to impart training to 20,000 data and AI specialists by the end of the decade.

Among the UAE’s largest investments in AI education was the establishment of the Mohamed bin Zayed University of Artificial Intelligence in 2019. It ranks 30th globally among institutions that conduct research in AI, computer vision, machine learning and natural language processing.

Qatar also has several branch campuses of renowned universities such as Carnegie Mellon University in the US, where students can pursue AI-related degrees and research.

The country is also home to the Qatar Centre for Artificial Intelligence, which is working to attract talent to its AI faculty and establish a research and policy centre.

However, Pakistan lags behind on this front, owing to an old-fashioned education system, where inventions, new technology adoption and training students is scarce.

Invention and investors in cutting-edge technologies remain scant in the Pakistani ecosystem, as the maturity in the ecosystem is still a far-fetched dream.

Comment

MUTAHER KHAN
Co-founder of Data Darbar

The deep-tech startups in the US mostly originate from the universities. If we look at the biotech pipeline in the US, most of these ventures start from the universities such as Howard and Massachusetts Institute of Technology

Mutaher Khan

Co-founder of Data Darbar