Not too long ago this was going nowhere. Nobody was willing to buy it, no university nor business school nor institution. Neither the economists nor the policymakers had any patience with entrepreneurship, with the exception of one, Nadeem-ul-Haq. The academia was immune the idea to do with SMEs or entrepreneurship.
And when I spoke to a Minister of Industry, who is a prominent entrepreneur himself some time back, he said that SMEs are not on his radar. The apathy was writ large. I am pro-entrepreneurship since a long time, having written on the subject and having authored a book as well on the subject. Over two decades I have tried to specialise on the subject and tried to draw attention to its significance but nobody was willing to listen.
It had to be the Americans to change the mindset. They are offering huge funds to create an entrepreneurial environment by asking it to be introduced through the education system at all levels. At first they went about it by surveying the entrepreneurial environment at district levels and the Empower Pakistan Entrepreneur programme finally took steps to launch the initiative.
They have looked at the issue from the right perspective, which is education. Now the Planning Commission has been engaged in a big way and it was not hard to sell the idea to them because of the staggering package they were offering and because of Nadeem ul Haq. In my opinion it should augur well for Pakistan as have strong faith in the paradigm shift in our education system.
Once the Americans give a go ahead signal, then all other developed countries and agencies come up with their version of aid package. Recently IBA Karachi has been given a huge package of five million dollars to introduce the programme in collaboration with an American university and is also being supported by another package of similar amount.
It even goes beyond that as the Global Entrepreneurship Monitor (GEM) has partnered with IBA to conduct a survey of Pakistan to determine the level of the entrepreneurial facilitating environment in Pakistan. The funding for this countrywide survey is coming from USAID. This is the largest monitoring agency in the world on entrepreneurship that also determines the entrepreneurial index of countries. The GEM research programme is an annual assessment of the national level of entrepreneurship activity. The GEM is the largest single study of entrepreneurship activity in the world researching the role of entrepreneurship in national economic growth. The GEM research has three main objectives ie (1) to measure the level of entrepreneurial activities among countries; (2) to identify the main determinants of different levels of entrepreneurship; and (3) to propose strategies that foster the level of entrepreneurial activity. Currently, there are between 50 to 60 countries that are members of GEM that have undergone assessment of entrepreneurial activity, and Pakistan is a recent member.
As we stand today entrepreneurship has drawn attention from all policymakers in the developed world and some developing countries over a period of one decade. Entrepreneurship has been recognised as the new dimension in economic growth. Previously Schumpeter was ignored as was his discovery of Entrepreneurship and its predominant role in economics development. But the subject is now very much under the microscope. Three years ago there were about 45,000 journals in the world and out of these only 44 were entrepreneurship-dedicated journal. Today, there are over 70 entrepreneurship journals and the entire growth in journals has come from China. That should give an idea of the emerging importance of entrepreneurship because China was a country that was opposed to entrepreneurship.
In 2008, EMLYON Business School France and KPMG, Europe, formed the biggest Think Tank of Entrepreneurship along with ACE (Action Community for Entrepreneurship Singapore) and NTU (Nanyang Technological University Singapore). The World Entrepreneurship Forum is in fact an international community of entrepreneurs, academics, social entrepreneurs committed to making the world a better place. It fosters entrepreneurship world-wide. This again announces the singular importance of entrepreneurship world-wide.
If the Planning Commission dishes out its outsourced work to its favourites or those who do not have knowledge of ground realities, then the work will be a half-baked pie. If it is the Pseudo Champions of Entrepreneurship and SMEs who crop up at the time of donation being pumped in, then, we will have poorly designed and implemented policies and projects. The money will go down the drain without any benefit to the common man. There are not many who have Entrepreneurship credentials to support the Planning Commission and nor do we have teachers or professors to teach Entrepreneurship Education in Pakistan. However, the work must go on. My suggestion may look alien but that's the paradigm shift that is required, and I suggest the following:
Education-related (The education policy should be developed with entrepreneurship taking the centre position, right across from the primary, secondary, college to university level to develop entrepreneurial thinking - a series of job providers not seekers.
(Entrepreneurship Development Institute (EDI) be set-up in all parts of the country in educational institutions and universities. Introduce research-based curriculum on entrepreneurship, enhancing entrepreneurs' culture and the numbers targets (Goals and Mission of Entrepreneurship Education Policy). (Business Incubation Centres and Technology Parks in all important cities and universities of the country. (Backward integration involving vocational development institutions, producing tradesmen with incentive to become micro-entrepreneurs.
Politically-related
(Ministry of Entrepreneurship. New ministry is required for its recognition, development and growth. Introduce an additional ministry independent as the Ministry of Entrepreneurship and small enterprises. This will be the only way to develop this sector and create an enabling environment for Entrepreneurs and SMEs. Giving clout to this sector (we are a power-centric society culturally). Those who do not understand the subject will oppose this idea but it's essential for growth.
Banking and finance-related
(Go for creating provincial Small Enterprise Development Bank (SEDBs) in all the five provinces. At the same time go for Small Enterprise Credit Guarantee Bank (SECGB) at all provincial levels by the provinces. There will be criticism against a bank but these are development banks and essential for SME growth.
(Make it mandatory for SME to undergo a short business management training programme to create an awareness of management to run business and to feel morally responsible to return the money borrowed. (Training prior to lending scheme).
(Venture Capital Firms to be motivated to be set-up. Again essential for growth of Entrepreneurship.
Policymaking-related
( Policy should be entrepreneurship. A shift in paradigm from SME policy to entrepreneurship policy. Should define S and M and separate S from M.
Compulsory for small enterprises
(Make it compulsory for small enterprises to obtain NTC registration before availing a bank loan or financing. (Revenue for Government)
Small enterprise and entrepreneurship hub
(Small enterprise and entrepreneurship hub of support services. Without these support services infrastructure entrepreneurship and small enterprises will not grow.
These are essential ground realities and our academic community and consultant communities must recognise these ground realities.