Thursday, February 20, 2020

Pakistan Tech Summit 2020 at Draper University in San Francisco Bay Area

Hundreds of Pakistanis and Pakistani-Americans attended Pakistan Tech Summit 2020 at Draper University in San Mateo, California on February 15, 2020. It was organized by Arzish Azam of Ejad Labs with sponsorships from JS Bank, Netsol, VisionX, Pakistan IT ministry, Pakistan National IT Board and Pakistan Software Exports Board. This event came after a recent report in Germany's Deutsche Welle (DW) by Miriam Partington who wrote in a story titled "Pakistan: The next big Asian market for tech startups?" that "Pakistan's young and tech-savvy population, market of over 220 million people and increasing levels of local capital are creating opportunities for tech entrepreneurs".

Pakistan Tech Summit:

At this conference, I was really encouraged by the presence of many young Pakistan entrepreneurs eager to realize the vision of Digital Pakistan. Enthusiasm is necessary but not sufficient. What is missing is serious attention to attract more risk capital to support these young enthusiastic entrepreneurs.  Unfortunately, I did not see any known Silicon Valley venture capitalists (VC) at the event. Recent McKinsey report on Pakistani startup ecosystem noted that per capita venture capital is just 6 cents, lower than 7 cents in Bangladesh and only a third of 18 cents in Nigeria. What Pakistan needs is a venture capital initiative along with digitization initiative.




Founders or cofounders of several Pakistani startups pitched their companies hoping to attract venture investors. Among the attendees were many young enthusiastic techies.



Najeeb Ghauri, Chairman of Netsol Technologies, made a pitch that focused on the opportunities presented to investors by Pakistan's growing young enthusiastic talent pool and large aspirational middle class population. JS Bank's Noman Azhar talked about his bank's fund that invests in Pakistani startups taking advantage of the government's Digital Pakistan Initiative. An example of their investment is e-challan systems in Islamabad and Peshawar.

Morning keynote speaker was Farrukh Mahboob of VisionX which offers custom-built digital products and mobile applications for businesses. Their digital solutions are tailored to clients’ needs and are powered by emerging technologies including artificial intelligence (AI), augmented and virtual reality (AR, VR).  VisionX clients includes Fortune 500 companies.

A number of startup pitches followed. Founders or co-founders of DontPort, Integry, Kumlaudi, SafePay, JoyCo and Social Pie pitched their ideas.

Examples of VC Funded Startups:

McKinsey report "Starting up: Unlocking entrepreneurship in Pakistan" has cited Daraz, Zameen, PakWheels, Tez Financial, Patari, AugmentCare and Sastaticket.  Monis Rahman, CEO of Rozee.pk, says this is an incomplete list. He personally knows about funds raised by the following companies that are missing from the McKinsey list:

Rozee.pk -- $9 Million across 3 rounds

Finja -- $4.5 Million seed + bridge (working on $15 Million round)

Airlift -- $12 Million Series A (working on $20 Million round)

Examples of VC Funded Pakistani Startups. Source: McKinsey

Lack of Venture Capital:

It was great to see many young Pakistan entrepreneurs eager to realize the vision of Digital Pakistan. Enthusiasm is necessary but not sufficient. What is missing is an enabling environment for startups to attract more risk capital to support these young enthusiastic entrepreneurs.  Unfortunately, I did not see any known Silicon Valley venture capitalists (VC) at the event. Recent McKinsey report on Pakistani startup ecosystem noted that per capita venture capital is just 6 cents, lower than 7 cents in Bangladesh and only a third of 18 cents in Nigeria. India's level of per capita is at $3.72 and UAE's $40 per capita VC investment is more than 10X India's.

Venture Capital Per Capita. Source: McKinsey

Need For Venture Investment Initiative:

Pakistan needs to have a venture capital initiative to ensure that Pakistani startups fully participate in  Digital Pakistan Initiative. Part of the venture capital initiative should create legal and policy framework to protect investors and facilitate their exit strategies. Pakistan government should invite  venture capitalists and offer to participate as a significant investor in professionally VC funds that invest in Pakistani startups. Experienced Pakistani VCs and entrepreneurs like Asad Jamal and Monis Rahman can be used as a resource to establish this venture investment initiative.

Enabling Startup Ecosystem. Source: McKinsey

Summary:

Recent "Pakistan Tech Summit 2020" at Draper University in San Francisco Bay Area attracted dozens of enthusiastic tech savvy young men and women ready with their startup pitches. It confirmed what Deutsche Welle's Miriam Partington recently reported in a story titled "Pakistan: The next big Asian market for tech startups?" in which she wrote: "Pakistan's young and tech-savvy population, market of over 220 million people and increasing levels of local capital are creating opportunities for tech entrepreneurs". Unfortunately, I did not see any known Silicon Valley venture capitalists (VC) at the event. Recent McKinsey report on Pakistani startup ecosystem noted that per capita venture capital is just 6 cents, lower than 7 cents in Bangladesh and only a third of 18 cents in Nigeria. India's level of per capita is at $3.72 and UAE's $40 per capita VC investment is more than 10X India's. Pakistan needs to have a venture capital initiative to ensure that Pakistani startups fully participate in  Digital Pakistan Initiative. Part of the venture capital initiative should create legal and policy framework to protect investors and facilitate their exit strategies. Pakistan government should invite  venture capitalists and offer to participate as a significant investor in professionally managed VC funds that invest in Pakistani startups. Experienced Pakistani VCs and entrepreneurs like Asad Jamal and Monis Rahman can be used as a resource to establish this venture investment initiative.

Related Links:

Haq's Musings

South Asia Investor Review

Pakistani-American VC Asad Jamal Invested Early in Baidu

Pakistani Students Win First Place in Stanford Design Contest

Pakistanis Win AI Family Challenge in Silicon Valley

Pakistani Gamer Wins ESPN E-sports Player of the Year Award

Pakistan's Expected Demographic Dividend

Pakistan's Research Output Growing Fastest in the World

AI Research at NED University Funded By Silicon Valley NEDians

Pakistan Hi-Tech Exports Exceed A Billion US Dollars in 2018 

Pakistan Becomes CERN Member

Pakistani Tech Unicorns

Rising College Enrollment in Pakistan

Pakistani Universities Listed Among Asia's Top 500 Jump From 16 to 23 in One Year

Pakistani Students Win Genetic Engineering Competition

Human Capital Growth in Pakistan

Pakistan Joins 3D Print Revolution

Pakistan Human Development in Musharraf Years

Tuesday, February 11, 2020

Who's Pete Buttigieg بو دجاج ? What Does He Stand For?

Thirty-eight year-old Mayor Pete Buttigieg (بو دجاج)  of a small Indiana town of South Bend has so far been the biggest surprise with his surge in Democratic Party primaries for the presidential nomination this year. His strong showing among the top two candidates in Iowa and New Hampshire has been as much of a shock to the pundits as the poor performance of former Vice President Joe Biden who is also seeking the nomination. Mayor Pete is now beginning to get more scrutiny by media pundits and commentators.

Mayor Pete's Last Name:

Mayor Pete Buttigieg, 38,  is Maltese-American. His last name literally means "father of chicken".  His parents came from Malta, a small Mediterranean island close to Sicily and North Africa.  His last name is in Maltese, a language strongly influenced by Arabic. It is attributed to settlers from Sicily where Siculo-Arabic was spoken after the island was conquered by the Fatimids from Egypt in the 9th century AD.

Buttigieg's Sexual Orientation:

Pete Buttigieg (بو دجاج) is the first openly gay leading candidate for the office of the President of the United States (POTUS). He has regularly introduced Chasten Glezman as his husband at his election rallies. Recent surveys show that two-thirds of Americans support gay marriage, an increase of more than 20 points since the turn of the century.

Mayor Pete's Corporate Background:

Pete Buttigieg is a graduate of Harvard and Oxford Universities. As a 20 year-old, he served as President of the Student Advisory Council at Harvard University’s esteemed Institute of Politics. He wrote twice-a-month columns in the Harvard Crimson.

After graduating, Pete Buttigieg worked for the elite management consulting firm McKinsey & Co. His work at McKinsey has been criticized by his opponents for helping corporate America move jobs overseas. Some have accused him of being corporations' favorite. He has received large contributions from the biggest US corporations.

Mayor Pete is Moderate:

As a millennial, Mayor Pete is the youngest candidate in a field dominated by senior citizens. He is openly gay, millennial and a veteran of the war in Afghanistan. Buttigieg served in Afghanistan for 7 months in 2014 as a lieutenant in US Navy Reserve. He speaks English, Norwegian, Spanish, French, Italian, Maltese, Arabic, and Dari.

He is close to the center of the Democratic Party when compared with his main rivals in the primary.
He opposes Medicare For All but supports universal health coverage. He favors granting citizenship to Dreamers, the people who were brought to the United States by their parents illegally when they were children.

Mayor Pete is for doubling federal minimum wage to $15 an hour. He wants to reverse 2017 corporate tax cuts and increase earned income tax credit (EITC).

Buttigieg's Israel Policy:

Unlike Bernie Sanders who wants to cut US aid to Israel, Buttigieg has said he would consider using it to “leverage” Israel to change its policies toward the Palestinians.

“I’m not going to commit now to all of the ways that that leverage can and should be used, but I will say that our policy goal will be to do what we do when a friend is moving in a way that you’re worried about, which is to put your arm around them and guide them somewhere better,” he said.

Summary:

Mayor Pete Buttigieg is the first openly gay presidential candidate in US history. He is also the youngest person to seek the nomination. His Maltese name Buttigieg  بو دجاج  is of Arabic origin. It means father of chicken.  He is a small town mayor from South Bend, Indiana, who has so far been the biggest surprise with his surge in Democratic Party primaries in Iowa and New Hampshire. He is considered a moderate in the Democratic field.  Even though he wants to reverse 2017 corporate tax cuts but some accuse him of being a corporate candidate and the recipient of large donations from the biggest US corporations. He supports increasing federal minimum wage to $15 an hour and favors universal health coverage. He also supports granting US citizenship to Dreamers, the people who were brought to the United States by their parents illegally when they were children.

Related Links:

Haq's Musings

South Asia Investor Review

Silicon Valley Indian-American Congressman Joins Pakistan Caucus

Muslim-Americans in San Francisco Bay Area

The Trump Phenomenon

Islamophobia in America

Silicon Valley Pakistani-Americans

Pakistani-American Leads Silicon Valley's Top Incubator

Silicon Valley Pakistanis Enabling 2nd Machine Revolution

Karachi-born Triple Oscar Winning Graphics Artist

Pakistani-American Ashar Aziz's Fire-eye Goes Public

Two Pakistani-American Silicon Valley Techs Among Top 5 VC Deals

Pakistani-American's Game-Changing Vision 

Minorities Are Majority in Silicon Valley 

Saturday, February 8, 2020

Pakistani Woman Industrial Designer Wins Lexus Global Design Award

Aqsa Ajmal, a graduate of Pakistan's National University of Science and Technology, is among six finalists for Lexus Design Award 2020 for industrial design.  Each of these finalists will receive 3 million Yen (over $25,000) in funding and mentorship in an exclusive program in New York City under the guidance of prominent design leaders from a variety of design fields.

Pursewit Sewing Machine. Source: Lexus

Aqsa's entry is named Pursewit. The device provides an easier way to incorporate sewing skills into income generation for the blind who rely upon touch and other senses. The thread path is much more simplified and streamlined; the user follows a straight, outlined path from the spool pin to the machine’s arm and through a loop, then down to the needle. The machine provides feedback at each step to ensure the process is completed, according to Lexus.

Aqsa Ajmal. Photo Credit Lexus
Aqsa's entry ranked among the top 6 from 2,042 submissions from 79 countries. The other finalists are from the China, France, Italy, Kenya, Russia and the United States.

Lexus describes Lexus Design Award competition as follows:

"Lexus Design Award provides a unique platform for young creators to demonstrate and further develop their talents. Founded in 2013 to support and foster up-and-coming creators, the program continues to evolve to inspire innovations in design that lead to a better tomorrow, and each year has seen a steady increase in number of entries from across the world. Last year, creators from 65 countries submitted 1,548 design proposals, many of which leveraged the power of technology."

Growing numbers of young Pakistanis are now participating and winning in international design and engineering competitions. Recent examples include Stanford Design Contest, AI Family Challenge World Championship and International Genetically Engineered Machine Competition. These wins offer increasing evidence of Pakistan's expected demographic dividend.


Related Links:

Haq's Musings

South Asia Investor Review

Pakistani Students Win First Place in Stanford Design Contest

Pakistanis Win AI Family Challenge in Silicon Valley

Pakistani Gamer Wins ESPN E-sports Player of the Year Award

Pakistan's Expected Demographic Dividend

Pakistan's Research Output Growing Fastest in the World

AI Research at NED University Funded By Silicon Valley NEDians

Pakistan Hi-Tech Exports Exceed A Billion US Dollars in 2018 

Pakistan Becomes CERN Member

Pakistani Tech Unicorns

Rising College Enrollment in Pakistan

Pakistani Universities Listed Among Asia's Top 500 Jump From 16 to 23 in One Year

Pakistani Students Win Genetic Engineering Competition

Human Capital Growth in Pakistan

Pakistan Joins 3D Print Revolution

Pakistan Human Development in Musharraf Years

Friday, January 31, 2020

Pakistan's Arslan Ash Siddique Wins ESPN's ESports Player of the Year Award 2019

Arslan Ash Siddique from Lahore, Pakistan has won three top ESports awards, including Player of the Year award for 2019, according to ESPN.com. In December awards, Aslan Ash won the Best Esports Player award under both the fan and ESPN choice categories. He was also the first-runner for Best Moment of the Year award in the fan poll. The nomination was based on his EVO wins.

Arslan Ash Siddique at EVO Japan 2019

Esports have risen to the level of other major international sports with multiple international tournaments. Esports leagues have sprung up in many countries including Pakistan. Esports Pakistan (ESPK) is a growing E-Gaming organization which organizes national esports competitions at its Gaming Arena at Royal Palm, Lahore.

Arslan put Pakistan on the esports map following his surprise first-place victory in Tekken 7 at EVO Japan 2019 and EVO 2019. Before October 2018, Ash, the Pakistani Tekken 7 phenom, had never competed in a major international tournament. Now, at the end of 2019, he is an international star and the only person to ever win the Evolution Championship Series Japan and its American counterpart in  Las Vegas the same year.

Arslan is not the only successful Pakistani esports competitor on the world stage. Karachi-born Pakistani Syed Sumail Hasan, 19, is the world's youngest video gamer to surpass $1 million in earnings in esports. In fact, he has earned $3.6 million so far as an international Dota 2 player, ranking him the 10th biggest winner in the world, according to esportsearnings.com website which tracks players' earnings. Sumail started playing Dota 2 at the age of 7. He now lives in a Chicago suburb as a permanent resident of the United States.


Syed Sumail Hassan

Arsalan Ash Siddique, 23 years old player from Lahore, Pakistan, caused a stir in Fukuoka Japan when he defeated world's top players to win EVO championship in February, 2019, according to Asahi Shimbun. In his victory speech, Arslan acknowledged many unknown Pakistani players who are also quite strong but could not join the competition because they could not get the visa to travel to Japan.



It wasn't easy for Arsalan to reach Japan to participate in the contest. He had to jump through many hoops and travel through several transit countries each of which made it difficult for him. When he arrived at Haneda airport in Japan,  he only had Pakistani rupees and no exchange would accept them. Hungry and tired he tried his luck at the food court but no one would accept the Pakistani currency. His next flight was from Narita airport an hour away by public transport. To travel he needed to buy a ticket but did not possess any local currency, according to SBS Urdu.

Arsalan Ash Siddique (Center)

Arsalan was exhausted and ready to give up his dream when he finally got through to his Japanese sponsors who helped him out. Needless to say he got no help from Pakistani diplomats through his challenging journey.

In spite of visa denials and other travel challenges faced by Pakistani players, the country ranks 25th in the world for players' earnings in 2019, according to esportsearnings.com.  Ranked above Pakistan are  mainly rich industrialized nations from North America, Europe and East Asia. All South Asian nations rank below Pakistan. Players from India rank 63rd, Sri Lanka 98th, Afghanistan 108th, Bangladesh 115th and Nepal 123rd.

Related Links:

Haq's Musings

South Asia Investor Review

Pakistani Esports Player Among World's Top Earners 

Mobile Game Industry in Pakistan

Pakistani Investors: Invest in Local Tech Startups

Invest in Pakistan Summit in Silicon Valley

Upwardly Mobile Pakistani-Americans

Upwardly Mobile Pakistan


Friday, January 24, 2020

Why is America So Deeply Involved in the Middle East? Energy? Geography?

What is the importance of the Middle East for the West? Is it energy resources to fuel the industrialized West? Or the key trade and shipping routes passing through the Persian Gulf and the Suez Canal used by ships to sail from Asia to Europe and North America?

Map of Greater Middle East (Morocco to Pakistan)

Why is oil, the most traded commodity, priced and traded in US Dollars? Does oil trade help maintain the US Dollar as the international trade and reserve currency and solidify US control of the global financial system, giving the US a very powerful tool to control the world?

What is the history of West's involvement in the Middle East? Can it be traced back to the fall of the Ottoman Empire in early 20th century?

When did the United States take over where Britain and France left off? Cold War? Iranian leader Mosaddegh's overthrow by CIA? Suez Crisis?

Energy revolution is in full swing in Silicon Valley with widespread use of solar panels, electric vehicles and storage batteries. Like other technologies emerging from Silicon Valley, this energy revolution will spread to the rest of the United States and the world in the next decades. How will it change US policy and posture in the Middle East?

Does the US involvement in the Middle East pose a threat to Pakistan? Is Pakistan next after Iran? Will Pakistan's nuclear weapons help keep Pakistan secure? What economic and other powerful tools does the United States have to put pressure on Pakistan or any other country?

ALKS host Faraz Darvesh discusses these questions with Misbah Azam and Riaz Haq (www.riazhaq.com).

https://youtu.be/DQIUue1tb4A





Related Links:

Haq's Musings

South Asia Investor Review

Muslims in Silicon Valley

US Dollar as International Trade/Reserve Currency

Soleimani Was the Hardest of the Hardliner

Sykes-Picot Agreement in Middle East

Confessions of an Economic Hitman

Putin Challenges American Exceptionalism

Remittances to Pakistan Up 21X Since Year 2000

Modi's Kashmir Blunder

Godfather Metaphor for Uncle Sam

Clean Energy Revolution

Destructive Power of Drone Swarm on Saudi Oil Installation

US Dominates List of World's Top Universities

Indian RAW Agent Kulbhushan Jhadav Used Chabahar

Iran-Saudi Conflict

Pakistan's Nuclear Program

Iran Nuclear Deal

1971 India-Pakistan War

Chabahar vs Gwadar Ports

Did America Contribute to the Rise of ISIS?

Riaz Haq's YouTube Channel

PakAlumni Social Network

Wednesday, January 22, 2020

Lower Import Duties Rattle Pakistan's Mobile Handset Makers

Pakistan Federal Board of Revenue has recently announced that “Sales Tax and Income Tax at import stage has been drastically reduced in case of smartphones of Rs15,000 or below". This action was apparently taken after Digital Pakistan Initiative led by Tania Aidrus asked for it. It has come under fire from the country's nascent mobile phone and smartphone manufacturing industry which is producing low-cost mobile phones. Pakistan's mobile handset market is the 8th largest in the world. Current annual demand is for about 40 million units of which 13 million are assembled in Pakistan while the rest are imported, according to a report by Dunya News. The import bill for Fiscal Year 2020 is expected to be about $1.2 billion. Boosting it will save billions of dollars of precious foreign exchange. It will create tens of thousands of jobs and spawn new auxiliary manufacturing industries for chargers, headphones, USB cables, cases, etc.  In future, Pakistan could become a significant exporter of mobile handsets.

GFive Promo. Source: GFive

Mobile Phone Demand:

There are currently 164 million mobile phone users in Pakistan, the 8th largest in the world.  The current annual demand for mobile phones in the country is estimated at about 40 million units, according to Pakistan Telecommunication Authority (PTA). The fastest growing demand is for 4G smartphones.

According to Pakistan Bureau of Statistics, mobile-phone imports (HS Code: 8517.1219) reached $498 million in 5 months period from July to November 2019,  64% jump over the prior year. Fiscal 2019-20 imports are expected to reach $1.2 billion.

Earlier, the growth rate for 4G handsets jumped from 16% in 2018 to 29% in 2019. Imports of mobile handsets soared 69% from $ 364 million in 2018 to $ 615.7 million in 2019. Pakistan is world's seventh largest handset importer and the 8th largest mobile phone market.

Pakistan Telecom Indicators. Source: PTA

Domestic Manufacturing:

Pakistan Telecommunication Authority (PTA) has granted permission to 26 local companies for manufacturing out of which 15 are currently in production. Among those currently producing mobile handsets in Pakistan are: E-Tachi, GFive, Haier, Infinix and Tecno. They are producing  13 million mobile phones.

Domestic manufacturers claim that they can meet 80% of demand for mobile handsets over the next 2 to 3 years if they are sufficiently protected by higher tariffs on imports.

Domestic mobile phone manufacturing industry will save billions of dollars of precious foreign exchange. It will create tens of thousands of jobs and spawn new auxiliary manufacturing industries for parts, chargers, headphones, USB cables, cases, etc.  In future, Pakistan could become a significant exporter of mobile handsets.

Summary:

Pakistan's mobile handset market is the 8th largest in the world. Current annual demand is for 40 million units. Domestic plants produce 13 million units while the rest are imported.  The import bill for Fiscal Year 2020 is expected to be about $1.2 billion.  The country's nascent mobile handset manufacturing industry fears a serious early setback if the FBR decision to lower duties on imports of foreign made mobile phones is not reversed. It is being blamed on Tania Aidrus, Prime Minister Imran Khan's advisor on Digital Pakistan Initiative, who would like to increase availability of mobile handsets. Domestic mobile phone manufacturing industry will save billions of dollars of precious foreign exchange. It will create tens of thousands of jobs and spawn new auxiliary manufacturing industries for chargers, headphones, USB cables, cases, etc.  In future, Pakistan could become a significant exporter of mobile handsets.

Related Links:

Haq's Musings

South Asia Investor Review

Digitization in Pakistan

Public Sector IT Projects in Pakistan

Pakistan's Gig Economy 4th Largest in the World

Afiniti and Careem: Tech Unicorns Made in Pakistan

Pakistani American Heads Silicon Valley's Top Incubator

Silicon Valley Pakistani-Americans

Digital BRI and 5G in Pakistan

Pakistan's Demographic Dividend

Pakistan EdTech and FinTech Startups

State Bank Targets Fully Digital Economy in Pakistan

Campaign of Fear Against CPEC

Fintech Revolution in Pakistan

E-Commerce in Pakistan

The Other 99% of the Pakistan Story

FMCG Boom in Pakistan

Belt Road Forum 2019

Fiber Network Growth in Pakistan

Riaz Haq's Youtube Channel


Tuesday, January 14, 2020

Pakistan's Middle Class Consumer Population Among World's Fastest Growing

Although the rate of growth has slowed since 2018, Pakistan's middle class consumer population still remains among the fastest growing in the world. In a report titled "Emerging Markets Transforming As Velocity Markets", Ogilvy and Mather, a global market communications firm, has put Pakistan among what it calls "Velocity 12" group of economies that include Bangladesh, Brazil, China, Egypt, India, Indonesia, Mexico, Myanmar, Nigeria, Pakistan, Philippines and Vietnam.  The term velocity describes both the rate of real change in the size of the middle class as well as a priority for companies as they consider business investment and marketing in V12 countries. These 12 countries will be the biggest contributors to the next billion middle class consumers, according to the report.

The Velocity 12 report says that this next billion middle-class group will:

1. Be increasingly defined by women and youth as the change agents, with purchasing power crossing cultural, religious and demographic divides.

2. Comprise the largest block of newly connected consumers on the internet, globally connected as never before – with global connectivity that is projected to double in the next five years.

3. Rapidly increase its social engagement, and brands discussion, as marketers compete in the digital marketplace for greater share of the new middle-class prize.

4. Urbanize faster than other parts of the world, dominating the future list of megacities, while creating a new “urbangea” that connects large swathes of these countries into a virtual trading zone.

5. Propel cities, more than countries, to become the unit of invention, entrepreneurship and investment.

Growth in Middle Class Consumers 2015-25. Source: Ogilvy and Mather

Velocity 12:

Ogilvy and Mather's report on "Velocity 12" begins with the story of Fahima Sarkar, a Pakistani woman entrepreneur who lives in Lahore. Here is an excerpt:

"If you want to catch a glimpse of the global economic future, then meet Fahima Sarkar. In many ways, Fahima – who lives in Lahore, Pakistan – is typical of her group of friends, and a growing number of women across South Asia. After attending college, Fahima worked in sales for a Karachi-based garment company that was rapidly expanding their business in the region. She eventually left the role because she wanted to start a family. Fahima is a lot different than her own mother – both in her outlook and her lifestyle. Rather than being solely a stay at home mom, Fahima has used her time raising her child to develop a new career as an “Instapreneur,” someone who uses social media to start her own business. Her online venture (headquartered on her kitchen table): selling high-end picture frames via the Web to parents who want an upscale way to display their children’s photos at home. That was her first taste of entrepreneurship – and she turned a profit almost immediately."

"Velocity 12" report forecasts Pakistan's middle class consumer population to reach 122 million by 2025, representing a gain of 59 million members over a 10 year period from 2015 to 2025.

Reality Check:

We are almost half way through Ogilvy's 10 year forecast period. How is Pakistan doing? One indicator is the growth in vehicle ownership, particular the ownership of motorcycles.

Vehicle Ownership in Pakistan. Source: PBS

Private vehicle ownership in Pakistan has risen sharply in 4 year period from 2015 to 2016. More than 9% of households owned cars in 2018, up from 6% in 2015. Motorcycle ownership has jumped from 41% of households in 2015 to 53% in 2018, according to data released by Federal Bureau of Statistics (FBS) recently. There are 32.2 million households in Pakistan, according to 2017 Census.

As of 2015, almost all of South Asia's poor were in two countries: Bangladesh (3% of global poor) and India (24% of global poor). Of the world’s 736 million extreme poor in 2015, 368 million—half of the total—lived in just 5 countries. The 5 countries with the highest number of extreme poor are (in descending order): India, Nigeria, Democratic Republic of Congo, Ethiopia, and Bangladesh, according to the World Bank.

World's Poor Population Distribution. Source: World Bank


Retail Sales in Pakistan. Source: Statista.com

Retail Sales Growth:

Pakistan has seen retail sales climb from $145 billion in 2015 to $210 billion in 2018, according to Statista.com. Over 60 percent of the Pakistani population is between the aged of 15 to 64 years, which is the prime age of consumer spending.

With the introduction of 3G/4G services, internet penetration has risen rapidly. Internet subscriber growth in Pakistan is averaging over 22% per year and total subscribers crossed the 70 million mark in 2019. Cheap smartphones, low cost of 3G/4G services and a consumer-goods obsessed middle class has meant that Pakistan’s e-commerce sector is “mobile first”: some e-commerce start-ups claim that over 75 percent of their total business is online.

E-Commerce:

Online sales are growing much faster than the brick-and-mortar retail sales. Adam Dawood of Yayvo online portal estimates that e-tail sales are doubling every year. He expects them to pass $1 billion in the current fiscal year (2017-18), two years earlier than the previous forecast. This is being enabled by increasing broadband penetration and new online payment options. Ant Financial, an Alibaba subsidiary, has just announced the purchase of 45% stake in Pakistan-based Telenor Microfinance Bank. Bloomberg is reporting that Alibaba is in serious talks to buy Daraz.pk, an online retailer in Pakistan.

Advertising Revenue:

Growing buying power of rapidly expanding middle class in Pakistan drove the nation's media advertising revenue up 14% to a record Rs. 76.2 billion ($727 million), making the country's media market among the world's fastest growing for FY 2015-16, according to Magna Research.  Half of this ad spending (Rs. 38 billion or $362 million) went to television channels while the rest was divided among print, outdoor, radio and digital media. `



Digital media spending rose 27% in 2015-16 over prior year, the fastest of all the media platforms. It was followed by 20% increase in radio, 13% in television, 12% in print and 6% in outdoor advertising, according to data published by Aurora media market research

Mass Media Growth:

Advertising revenue has fueled media boom in Pakistan since early 2000s when Pakistan had just one television channel, according to the UK's Prospect Magazine. Today it has over 100. This boom has transformed the nation. The birth of privately owned commercial media has been enabled by the Musharraf-era deregulation, and funded by the tremendous growth in revenue from advertising targeted at the burgeoning urban middle class consumers.

Sports and Entertainment:

Sports and entertainment sectors are major beneficiaries of increasing advertising budgets. Commercial television channels' shows and serials are supported by advertisers. A quick look at Pakistan Super League 2018 matches reveals that all major consumer brand names are either directly sponsoring or buying advertising from broadcasters.  These ads and sponsorship have turned PSL into a major business producing tens of millions of dollars in revenue to support cricket in Pakistan.  Last year, Pakistan Cricket Board's budget was over $40 million and a big chunk of it came from PSL. This year, the PSL chairman Najam Sethi estimates the PSL franchise valuation is approaching half a billion US dollars with potentially significant revenue upside.

Downsides of Consumer Boom:

There are a couple of downsides of the consumer boom. First,  a dramatic increase in solid waste. Second, rising consumption could further depress Pakistan's already low private savings rate.

FMCG products come with a significant amount of plastic and paper packaging that contribute to larger volume of trash. This will necessitate a more modern approach to solid waste disposal and recycling in Pakistani towns and cities. An absence of these systems will make the garbage situation much worse. It will pose increased environmental hazards.

Pakistan's savings rate is already in teens, making it among the lowest in the world. Further decline could hurt investments necessary for faster economic growth.

Summary: 

Pakistan's $210 billion retail market is among the fastest growing in the world, according to Euromonitor.  In a report titled "Emerging Markets Transforming As Velocity Markets", Ogilvy and Mather, a global market communications firm, has put Pakistan among what it calls "Velocity 12" that include Bangladesh, Brazil, China, Egypt, India, Indonesia, Mexico, Myanmar, Nigeria, Pakistan, Philippines and Vietnam. These 12 countries will be the biggest contributors to the next billion middle class consumers, according to the report. Expanding middle class, particularly millennials with rising disposable incomes, is demanding branded and packaged consumer goods ranging from personal and baby care items to food and beverage products. Strong demand for fast moving consumer goods is drawing large new investments of hundreds of millions of dollars.  Rapid growth in sales of consumer products and services is driving other sectors, including retail, e-commerce, paper and packaging, advertising, media, sports and entertainment. Potential downsides of soaring consumption include increased amount of  solid waste and decline in domestic savings and investment rates.

Related Links:

Haq's Musings

South Asia Investor Review

FMCG Boom in Pakistan

Pakistan Retail Sales Growth

Advertising Revenue in Pakistan

Pakistan FMCG Market

The Other 99% of Pakistan Story

PSL Cricket League Revenue

E-Commerce in Pakistan

Fintech Revolution in Pakistan

Mobile Broadband Speed in Pakistan

Riaz Haq's YouTube Channel

PakAlumni Social Network

Sunday, January 12, 2020

Are Pakistani Leaders Slaves of Arab Royals?

Are Pakistani leaders slaves of Arab Royals? Or simply doing what is in Pakistan's best interest?

Prime Minister Imran Khan Driving Prince Mohammad Bin Salman in Islamabad

Why did Imran Khan not attend the Kuala Lumpur Islamic Summit that was organized by Malaysian Prime Minister Mahathir Mohammad and attended by Turkish President Erdogan and Iranian President Hasan Rouhani? Why did he yield to Saudi pressure to skip it?

What are Pakistan's key economic and security interests in Gulf Cooperation Countries (GCC)? Is labor Pakistan's biggest export earning over $20 billion a year? What is the biggest export market for Pakistan's labor? What would happen if Pakistan joined Malaysia and Turkey in creating a new Muslim bloc competing with the Arab-led Organization of Islamic Countries (OIC)? Will OIC try to live up to Pakistan's expectation of a tougher stance against India's Modi vis a vis Indian Occupied Kashmir and Indian Muslims?

Who makes Pakistan's foreign and security policies? How influential is Pakistani military in making these policies? Is Imran Khan free to pursue whatever policies he personally prefers? Would any other Prime Minister have pursued a different policy with GCC nations?

ALKS host Faraz Darvesh discusses these questions with Sabahat Ashraf (ifaqeer) and Riaz Haq (www.riazhaq.com).


https://youtu.be/ylEor2XPblQ




Related Links:

Haq's Musings

South Asia Investor Review

Soleimani Was the Hardest of the Hardliner

Confessions of an Economic Hitman

Putin Challenges American Exceptionalism

Remittances to Pakistan Up 21X Since Year 2000

Modi's Kashmir Blunder

Godfather Metaphor for Uncle Sam

Seeing Bin Laden's Death in Wider Perspective

Destructive Power of Drone Swarm on Saudi Oil Installation

US Dominates List of World's Top Universities

Indian RAW Agent Kulbhushan Jhadav Used Chabahar

Iran-Saudi Conflict

Pakistan's Nuclear Program

Iran Nuclear Deal

1971 India-Pakistan War

Chabahar vs Gwadar Ports

Did America Contribute to the Rise of ISIS?

Riaz Haq's YouTube Channel

PakAlumni Social Network

Friday, January 10, 2020

United States of America: Benevolent or Malign Superpower?

Is United States of America a benevolent or malign superpower?


The United States has provided large amounts of aid to developing nations but has also caused a lot of pain by many invasions and wars it has initiated in the Middle East and elsewhere. Is it better or worse than other imperial powers in history? How is it different? What does John Perkins say in his book titled "Confessions of an Economic Hitman"? Has US exercised its immense cultural, technological, economic, political and military power responsibly?


Is Pakistan's US policy good or bad for Pakistan? How should Pakistan balance its relationship with the United States with its growing relations with China emerging as the next superpower? What role should Pakistan play in its immediate neighborhood of South Asia and the Middle East? How can Pakistan help bring peace to Afghanistan? How can Pakistan help keep the peace between Iran and Saudi Arabia?


ALKS host Faraz Darvesh discusses these questions with Misbah Azam and Riaz Haq (www.riazhaq.com)

 https://youtu.be/09pn8tjCjho

 


Related Links:

Haq's Musings

South Asia Investor Review

Soleimani Was the Hardest of the Hardliner

Confessions of an Economic Hitman

Putin Challenges American Exceptionalism

Is America Young and Barbaric? 

US Dollar as International Trade and Reserve Currency

Godfather Metaphor for Uncle Sam

Seeing Bin Laden's Death in Wider Perspective

US Drones and Cyber Warfare

US Dominates List of World's Top Universities

Indian RAW Agent Kulbhushan Jhadav Used Chabahar

Iran-Saudi Conflict

Pakistan's Nuclear Program

Iran Nuclear Deal

1971 India-Pakistan War

Chabahar vs Gwadar Ports

Did America Contribute to the Rise of ISIS?

Riaz Haq's YouTube Channel

PakAlumni Social Network

Thursday, January 9, 2020

Soleimani Was the Hardest of the Hardliners in Iran

Iran's General Qassem Soleimani was in America's cross-hairs for many years. He was the hardest of the hardliners in Tehran. He was very effective in his role as the head of the elite but ruthless Qods Force which is part of Iran's "Pasdaraan" (Iran Revolutionary Guard Corps). He had made many powerful enemies, both at home and abroad. Some conspiracy theorists are speculating that his assassination was staged by American and Iranian intelligence agencies to get rid of the Iranian general who was getting too big for his boots. American and Iranian Intelligence agencies have cooperated in their common battle against ISIS in recent years. Both sides wanted to eliminate Soleimani for their own reasons but without starting a real US-Iran war.

Soleimani Assassination: 

His assassination on President Donald Trump's orders last week brought Washington and Tehran to the brink of yet another major war in the Middle East as  Iran lobbed over a dozen missiles at two Iraqi airbases housing American troops. The world took a sigh of relief when Trump decided to not escalate the situation. At the same time, conspiracy theorists have speculated that the whole things was staged by American and Iranian intelligence agencies to get rid of the Iranian general who was getting too big for his boots.  American and Iranian Intelligence agencies have cooperated in their common battle against ISIS in recent years. Both sides wanted to eliminate Soleimani without starting a real war.

Soleimani's assassination has raised many questions: Was it just President Trump who wanted the Qods Force chief dead? Are there others, particularly in Teheran, who are privately happy to see him gone? Was the general getting too big for his boots? Did some of the leaders in the Islamic Republic see his growing popularity and arrogance as a threat to their own power?  Let's try and address these questions.




Soleimani's Growing Popularity:

Polling data showed Soleimani was more popular than other major public figures, according to the Center for International Studies at the University of Maryland. It published a survey in 2018 that found Soleimani had a popularity rating of 83%, beating President Hassan Rouhani and Foreign Minister Zarif. 

Soleimani vs Rouhani:

There were reports in 2018 of President Hassan Rouhani lashing out at Soleimani during a meeting with several senior IRGC officers in attendance,  accusing him of hiding the truth from the president and even from the supreme leader. Soleimani left the room in anger. Earlier, when the two met during Friday prayers, Soleimani warned the president about the “folly of not increasing the budget allotted to Quds.”

Soleimani vs Zarif:

Soleimani sat by Imam Khamenei’s side at key meetings, conveying his importance in the eyes of the spiritual leader. He met Syrian leader Bashar Al-Assad in February 2019 together with the supreme leader — but without Iran’s Foreign Minister Mohammad Javad Zarif, triggering resignation threats by Iran's top diplomat.

Soleimani Threatened Pakistan:

In February, 2019, Soleimani threatened Pakistan. He boasted of Iran's "independent power and honor". He said:

"I warn you not to test Iran and anyone who has tested Iran has received firm response. We are speaking to Pakistan with a friendly tone and we are telling that country not to allow their borders to become a source of insecurity for the neighboring countries..... Iran enjoys independent power and honor. Some countries have wealth, but no prowess. Trump tells the Al-Saud that if it hadn't been for the US support, Saudi Arabia would not have survived and Saudi Arabia's coalitions in the region have all ended in failure."

Soleimani's tone in this message to Pakistan is anything but "friendly".

Soleimani's Global Covert Ops:

In 2012, Indian investigators found that five members of Iranian Revolutionary Guard Corps (IRGC) were involved bombing of a car of the wife of the Israeli defense attache in New Delhi.  IRGC was also allegedly linked to a similar attack in Thailand. The 1994 bombing of a Jewish community center in Argentina that killed 85 is believed to be IRGC's revenge in part for the 1992 killing of a Hezbollah leader.

Summary:

General Qassem Soleimani was the hardest of the hardliners.  As the head of the powerful and ruthless Qods Force, he made many powerful enemies at home and abroad.  Some conspiracy theorists are speculating that his assassination was staged by American and Iranian intelligence agencies to get rid of the Iranian general who was getting too big for his boots.  American and Iranian Intelligence agencies have cooperated in their common battle against ISIS in recent years. Both sides wanted to eliminate Soleimani for their own reasons but without starting a real US-Iran war. He was part of Mullah regime in Iran that has ruined a great country by unnecessarily challenging the United States which they refer to as "Shaitan Buzurg" (Great Satan). Even their missiles paraded every year in the streets of Tehran have “Marg Bar Amrika” (Death to America)  painted on them. Iranian Ex President Ahmadinejad brought unwanted and unhelpful US attention when he threatened to nuke Israel. Even as Iranians are suffering due to US sanctions and poor governance by mullahs, Solemani was going around spending money supporting Shia militias to establish Iran as regional hegemon. These policies have badly hurt Iran and its people.

Related Links:

Haq's Musings

South Asia Investor Review

Iran-Pakistan Ties

Iran's Chabahar and Pakistan's Gwadar Ports

Indian RAW Agent Kulbhushan Jhadav Used Chabahar

Iran-Saudi Conflict

Pakistan's Nuclear Program

Iran Nuclear Deal

1971 India-Pakistan War

Chabahar vs Gwadar Ports

Did America Contribute to the Rise of ISIS?

Riaz Haq's YouTube Channel

PakAlumni Social Network

Monday, January 6, 2020

Battle For Pakistan 2007-2019: Pak-US Ties and Civil-Military Relations

Shuja Nawaz's "The Battle For Pakistan: The Bitter Friendship and a Tough Neighborhood" looks at key events of the last decade that have characterized US-Pakistan ties and civil-military relations in Pakistan.  One of the biggest developments in the period covered by Shuja Nawaz's book is the rise of Narendra Modi and the Hindu Nationalists in India. His book is a well-written treatise but it is strangely silent on the implications of this major development for South Asia region and the world.

Author Shuja Nawaz

US Raid in Abbottabad:

On May 2, 2011, US commandos raided a house in Pakistani city of Abbottabad and killed Al Qaida leader Osama Bin Laden. There are many stories about who led the Americans to Bin Laden's hideout. The story that Shuja Nawaz appears to confirm is the one about ex Pakistani spy Lt Col Iqbal Saeed Khan walking into the US Embassy in Islamabad to tell the CIA station chief the exact location of Bin Laden. This spy was apparently well rewarded for it. He now lives in San Diego, California where he owns a multi-million dollar home and drives a BMW convertible.

“Col. Saeed, who ran a security firm in Islamabad, may have been responsible for providing logistic and surveillance assistance to the Americans in tracking and locating movements related to what turned out to the final lair of bin Laden in Abbottabad,” says Shuja Nawaz in his book. “Col. Saeed’s office in Abbottabad is reported to have been used as a listening and staging post. He is reported to have been recruited by Lt. Col. Hafeez, his predecessor at the helm of the 408 Intelligence battalion, who had been hired by the U.S., and according to one report, was even in the U.S., and that CIA Director George Tenet once brought him to a meeting with Gen. Kayani,” it adds.

Imran Khan's 2014 Dharna (Sit-in):

Shuja Nawaz confirms what was widely reported by Pakistani media in 2014: Pakistan ISI was behind Imran Khan's Islamabad dharna. He cites US Ambassador Richard Olson as his source. Olson said the following in a January 2017 interview with the author:

"We received information that Zahir [-ul-Islam, the DG-ISI] was mobilizing for a coup in September of 2014. [Army chief] Raheel [Sharif] blocked it by, in effect, removing Zahir, by announcing his successor...[Zahir] was talking to the corps commanders and was talking to like-minded officers....He was prepared to do it and had the chief been willing, even tacitly, it would have happened. But the chief was not willing, so it didn't happen."

Pakistan Military Dominance:

Shuja Nawaz argues in the book that "the armed forces, and in particular the army, continue to dominate decision making in Pakistan" in spite of the fact "the constitution of Pakistan established civilian supremacy". He explains that it is "largely because of its (army's) experience in running the country through successive military regimes and, to some extent, by the inability of civilian regimes to exhibit the political vision and will necessary to exert their constitutional control over the military".

Going back to the 1970s, Shuja Nawaz says in his book:

"The elder Bhutto (Zulfikar Ali Bhutto) had wished to cut the military down to size, demoting the commanders-in-chief of the services to chiefs-of-staff. But, he failed to understand that their power stemmed from their disciplined and organized institutions, while the political party that he headed, not unlike other political parties, tended to be fractured and weak, especially on governance.....family rule was the order of the day. Civilian leaders failed to empower the people who elected them time and again, and they failed to deliver on the promise of economic development."

Shuja Nawaz's Silence on Rise of Hindutva:

The biggest development in the period covered by Shuja Nawaz's book is the rise of Narendra Modi and the Hindu Nationalists in India. His book is strangely silent on the implications of this development for South Asia region and the world.

Clearly, Nawaz did not foresee what has happened in India and Indian Occupied Kashmir with the revocation of Article 370 of the Indian constitution and the passage of highly discriminatory Citizenship Amendment Act. Nor did he see Modi's dangerous gambit with attack on Balakot in Pakistan. The Indian action drew strong Pakistani response with Pakistan Air Force crossing the Line of Control in Kashmir and shooting down two Indian fighter jets.  Pakistan also captured an Indian fighter pilot shot down down in Azad Kashmir. It was Pakistani Prime Minister Imran Khan's deft handling of the regional crisis that prevented further escalation into a full-blown India-Pakistan war that could have gone nuclear.

Summary:

"The Battle For Pakistan" by Shuja Nawaz covers the period from 2007 when President Musharraf fired former Chief Justice Iftikhar Muhammad Chaudhry to the beginning of 2019 before Balakot attack by Indian Air Force. The book is strangely silent on the implications of far-right Indian Prime Minister Modi's rise for South Asia region and the world.  Most of the book is devoted to discussion of US raid on Osama Bin Laden's hideout in Abbottabad, Salala incident that took the lives of 24 Pakistani soldiers, Memogate that led to Husain Haqqani's ouster, Dawn Leaks incident that soured relations between Prime Minister Nawaz Sharif and the military and Pakistan Army operations to defeat Pakistani Taliban. The author appears to confirm stories about an ex ISI colonel helping CIA find Bin Laden and Pakistan ISI's instigation Imran Khan's 2014 Islamabad  dharna (sit-in). One of the biggest developments in the period covered by Shuja Nawaz's book is the rise of Narendra Modi and the Hindu Nationalists in India. His book is strangely silent on the implications of this development for South Asia region and the world.

Related Links:

Haq's Musings

South Asia Investor Review

India: A Paper Elephant?

Modi's Hindutva

Imran Khan's 2014 Dharna in Islamabad

Seeing Bin Laden's Killing in Wider Perspective

Top US CIA Agent on Pakistan ISI

Shuja Nawaz on Civil-Military Relations in Pakistan

China-Pakistan Economic Corridor

Ownership of Appliances and Vehicles in Pakistan

CPEC Transforming Pakistan

Pakistan's $20 Billion Tourism Industry Boom

Riaz Haq's YouTube Channel

PakAlumni Social Network