Wednesday / Jul 27 2016
Newspaper : The News
Since the formation of Pakistan, successive governments have largely ignored the key pillars necessary for socio-economic development. These are: (1) education; (2) science, technology and innovation (STI); (3) access to a quick and effective justice system that swiftly punishes the corrupt; and (4) a visionary, honest and technologically competent government.
For science and technology to have their due impact on society, government policies need to be redesigned in order to incentivise private business and investors as well as academic and research institutions to work in synergy in order to develop strong knowledge-based economies.
The era that we live in today has been termed by the World Economic Forum as a technological revolution that constitutes the fourth industrial revolution.
The future source of wealth will be access to information and the ability to accurately predict market trends by ‘Big Data’ mining. While industrial-scale businesses have historically been the source of wealth, a new important factor introduced in recent decades has been the role of innovation and entrepreneurship that involves facilitation of new business start-ups, access to venture capital, government enabling policies to promote private sector research and development, as well as ease of doing business.
Digital technologies are now playing an important part in this development. Realising this back in 2001 when I was the federal minister of science and technology (which at that time also included the Information Technology and Telecommunications Division) we decided to focus on the potential of Pakistan in the IT field and gave a 15-year tax holiday to the IT industry. A large number of institutions were established to promote quality IT education and thousands of students sent abroad for PhD level studies to strengthen the faculty in IT-related disciplines in our universities. The results are remarkable.
According to a report published on August 10, 1015 in the New York Times, the IT business has reached $2.8 billion annually (from only $ 30 million in 2001) and Pakistan ranks number 3 in the world in terms of the freelance programmers market with their software exports amounting to $850 million annually, behind only USA and India.
For Pakistan to develop a strong knowledge economy we need to make Science, Technology and Innovation the focal points for development. For this we must take the following measures, some of which I have also recommended for the Unescap region, in my capacity as chair of the STI Committee:
STI strategy and action plan: Establish a clear short, medium term and long terms vision, strategy and action plan for integrating STI into all sectors of the government ranging from industry and agriculture to health, communications and social services.
Provide leadership for implementation of STI vision: Support the STI vision with a strong and visionary leadership at the level of the prime minister for its effective implementation and position the mandate for STI in the office of the prime minister to ensure strategic implementation.
Foresight exercises for migration to knowledge economy: Conduct regular foresight exercises, aligned to the Sustainable Development Goals (SDGs) and integrated across all line ministries, in consultation with all stakeholders, to help in building functional innovation systems and to transition to knowledge based economies.
Financing of STI action plan for establishing a knowledge economy: Allocate appropriate funding for implementation of STI policy in national development plans including a sizeable allocation for R&D which should be at least three percent of GDP and progressively increased to five percent of GDP.
Institutional reforms: Undertake institutional reforms including the restructuring of institutions of higher learning and research, those providing testing, quality and standards related services, as well as legal and financial institutions.
Support and develop private industry to contribute meaningfully to a knowledge economy: Increase absorptive capacity of private industry to productively use external and internal knowledge for manufacture and export of high technology products by making government funding available for venture capital, for hiring highly skilled personnel.
Promote high-technology manufacturing and exports: Grant ‘pioneering status’ to high-tech industries with suitable long-term tax-free status to promote manufacturing and exports in high-tech fields, provide government insurance for under-writing risk in new high-technology ventures and establish a revolving ‘innovation fund’ to support indigenous high-technology development in the public and private sector.
Promulgation of national education emergency: Declare a ‘National Education Emergency’ so that the appalling state of education in Pakistan can be tackled on a war footing and allocate at least 10 percent of GDP for education to improve access as well as quality of primary, secondary, technical, vocational and higher education.
Promotion of world-class research: Establish world-class research institutions with internationally recognised, peer-reviewed scholarly capacity for academic and industry collaborative research, and undertake investments in the shape of setting standards, funded projects, research grants for faculty
Highly qualified manpower: Create a critical mass of high-quality professionals (scientists/engineers) and technically trained manpower (progressively increase to 2500 highly qualified professionals involved in R&D per million population). This will require a dramatic change in salaries and other incentives to reduce brain drain and re-attract diaspora to fulfil human capital needs for future growth and expansion.
Industrial clusters: Establish regional industrial clusters accompanied by technical training institutions (Fachhochschule model) to ensure cost effective, relevant, demand-driven and collaborative industrial production. The China-Pakistan Economic Corridor (CPEC) should become a ‘knowledge hub’ of such multiple industrial and training clusters focusing on the manufacture and export of engineering goods, defence products, biotechnology products, pharmaceuticals, etc.
Institutions for metrology, standards and testing: Establish concrete, world-class infrastructure for metrology, standards and testing including international standards, to facilitate consistent high quality product manufacture and exports.
Link FDI to knowledge transfer: The Planning Division should link the approval of all foreign assistance and Foreign Direct Investment projects to mandatory knowledge transfer, so that at least five percent of the cost of such projects is set aside for training and indigenous capability development, leading to national self-reliance.
For the above measures to be implemented, we need a government composed of top technocrats who realise the importance of a knowledge economy in this new knowledge-driven world.
Corrigendum: In my article of July 20, 2016, the variation in the strength of the big bang should have been published as one part in 10 to the power of 60 and not one part in 1060. Similarly, the figure 1040 shown elsewhere in the article should be 10 to the power of 40.