[Written by Sameen Mohsin]

Building a start-up requires more than just a strong idea, it demands the confidence to advocate for it, the clarity to negotiate its value, and the presence to lead through uncertainty. For many women founders, the challenge is not capability but how that capability is communicated in high-stakes moments. This is often compounded by the fact that women have to navigate additional barriers and expectations to reach the same stage. Yet, they continue to build with resilience, intent, and impact.

In this inaugural edition of Entrepreneurship Decoded, we explore these themes through a conversation with Amna Awan, Head of Operations at the LUMS Centre for Entrepreneurship. Drawing on her experience across corporate and development sectors, including roles at JazzCash, Karandaaz, UNDP, and USAID, Amna shares practical insights on how founders can approach negotiation more strategically, build a strong leadership presence, and navigate self-doubt in high-pressure environments. The discussion unpacks what it takes to show up with both confidence and clarity, and how women founders can more effectively advocate for the value they bring to the table.

From your experience across corporate and development sectors, do you observe differences in how women founders approach negotiations compared to men? What patterns stand out?

I like to look at this at different levels. In general, women tend to be very effective negotiators when they are negotiating on someone else’s behalf. For example, when they are negotiating for their family or their employer, they often perform very well.

However, when it comes to negotiating for their own interests, many women tend to be more hesitant in asking for what they deserve. Preparation is rarely the issue. Women usually come extremely well prepared, with the relevant research and data in hand. But they may be less assertive in pushing their position and may prioritise relationship management over securing the most favourable terms. As a result, they might walk away from a less lucrative deal.

Men, on the other hand, tend to prioritise their own interests more directly. They also tend to understand that relationships often work out better in the long run when all parties feel satisfied with the outcome.

How can founders prepare strategically before entering investor or client negotiations to reduce anxiety and strengthen their position?

Preparation makes a significant difference. Founders should begin by understanding the investor; their interests, preferences, and investment patterns. Looking at their existing portfolio can offer valuable insights into what they are looking for.

Beyond that, founders need to show a strong grasp of the market. This includes having data on market demand, the competitive landscape, and ideally some information about their own customers. Even if you only have a small number of early users or buyers, that still strengthens your case considerably.

Practice is equally important. What appears as passion on stage is often the result of a lot of practice. So founders should practice their pitch many times for their delivery to appear natural and confident.

Additionally, if there are areas where a founder feels less confident, whether financial modelling, legal structures, or technical aspects, it is perfectly reasonable to seek guidance from experts. The important thing is to ensure that the pitch deck and overall narrative are complete and well thought through.

Despite strong preparation, women founders still receive a smaller share of funding globally. What factors contribute to this gap?

Unfortunately, there is limited data specifically on women founders and fundraising in Pakistan. However, reports such as the Invest2Innovate Startup Ecosystem Report do provide some insight. According to the report, women-founded or co-founded start-ups received around 18.75% of total start-up funding in Pakistan between 2015 and 2024, and closed relatively few deals per year during certain periods.

This suggests a mismatch. On one hand, investors may still have reservations. On the other hand, women founders may not always pitch themselves as aggressively as their male counterparts. There are several factors at play; a smaller pipeline of women-led start-ups, differences in negotiation styles, and the fact that the investment community itself is still largely male-dominated.

For instance, in many investor summits we see very few female investors present. Women-led start-ups often receive more support from angel investors or donor-backed funds, where there is slightly greater representation of women. Traditional investment houses, however, are still dominated by men.

What are some common negotiation mistakes early-stage founders make, regardless of gender, that women should be particularly mindful of?

At an early stage, founders are often still refining their business model and may not be completely certain about the value they are offering or the terms they should accept in return. This can make negotiations challenging, especially when pitching to investors for the first time.

It is perfectly acceptable to pitch to a large number of investors, and it is normal that many conversations will not lead to a deal. However, when a deal does materialise, founders should avoid the temptation to move too quickly.

Sometimes, after a long search for investors, founders feel relieved to finally receive interest and may agree to terms too quickly. It is important to carefully negotiate aspects such as equity ownership, investment structures, and the level of control you want to retain in your company.

Consulting legal experts who specialise in investment deals can also be extremely helpful in structuring agreements that protect your long-term interests.

Leadership presence is often described as intangible. In practical terms, what does strong leadership presence actually look like?

In professional settings, people tend to evaluate others based on two key traits: confidence and warmth. Both are essential for making a strong impression.

Warmth helps you connect with your audience. It allows you to listen, respond thoughtfully to questions, and build rapport with the people you are interacting with. At the same time, you also need to demonstrate competence. This means showing that you understand your market, that you are familiar with the deals happening in your industry, and that you have done your homework.

Investors and partners are ultimately trusting you with their resources and their time. They want confidence that you can deliver on your promises and grow the value of what they invest in. Strong leadership presence therefore comes from balancing both dimensions, being approachable and relatable while also communicating expertise.

In male-dominated rooms, whether with investors, policymakers, or corporate leaders, what mindset shift can immediately change how a founder shows up?

Confidence is key. By the time you walk into the room, you have developed your idea, researched your market, and prepared your pitch. The focus then should be on communicating that work clearly and confidently.

There is a saying in negotiations that it is not just what you say, but also “how you arrange the furniture.” In practical terms, this means thinking about what supporting evidence you are bringing to the conversation, your data, your market insights, expert opinions, and customer validation.

Another important mindset shift is to see the conversation as one between equals. Investors are not simply giving money out of generosity. They are looking for opportunities to generate value, and you are offering them that opportunity.

How important are data and preparation in building confidence during high-stakes conversations?

Data is extremely important, but it needs to support a clear story. If there is too much data without a narrative, even experienced professionals can struggle to follow what you are trying to communicate.

A strong pitch answers a few key questions; why does this problem matter to you, why should it matter to the consumerm, what their needs are and why should investors care about this opportunity?

All of your data points should reinforce that story. Market validation is also very powerful. Even if your venture is at an early stage, evidence that a few customers are willing to pay for your product or service significantly strengthens your case.

Imposter syndrome is frequently discussed among high-achieving women. How can founders manage self-doubt while still making bold decisions?

If a woman and a man have reached the same professional level, the woman should take pride in that achievement because we know that in many cases, women have had to overcome additional obstacles and navigate more barriers along the way.

Men often do not hesitate to claim credit or pursue opportunities they believe they deserve. Women should also recognise the effort they have invested in reaching that stage and feel confident in claiming the opportunities that follow.

Research across different settings also shows that women often bring strong qualities to leadership roles. They tend to be conscientious, inclusive in their decision-making, and highly diligent in delivering results. These qualities create real value for any organisation or investor they work with.

What role does mentorship or sponsorship play in helping women founders build confidence and credibility?

Mentorship can make a tremendous difference, and this is also an area where the playing field is not equal between men and women. From a young age, men tend to have greater exposure to professional circles, larger networks, and more chances to exchange knowledge and expertise.

Women sometimes have fewer avenues to access those networks. That is why mentors can be so valuable. Both male and female mentors can help founders identify blind spots, strengthen their pitch, and share insights from their own experiences.

Learning from others is incredibly valuable, understanding what worked for them, what didn’t, what questions investors asked, and which deal structures proved beneficial in the long run.

One important thing to remember is that many experienced professionals are actually happy to mentor or advise founders. Giving advice is one way people contribute back to the ecosystem. So founders should not hesitate to reach out and ask for guidance.

It may take a few conversations to find someone whose advice resonates with you, but once you do, that relationship can become an incredibly valuable source of support.

The post Entrepreneurship Decoded: How Women Founders Can Build Confidence, Negotiation Skills & Leadership Presence appeared first on LUMS Centre for Entrepreneurship.

Overview

This article explores how entrepreneurship centres are shaping economic growth globally and examines their role within Pakistan’s evolving start-up ecosystem. It outlines the contributions of Business Incubation Centres (BICs), the challenges limiting their impact, such as declining investment, weak industry academia linkages, and limited sector specific support as well as the opportunities emerging across high-potential sectors like SaaS, agritech, fintech, and healthtech. It also highlights global trends, including deep-tech incubation, AI-focused accelerators, and venture studios, offering a roadmap for how Pakistan can strengthen its entrepreneurship infrastructure and build a more innovative, export-oriented, resilient economy.

Why Entrepreneurship Centres Matter for Growth

In modern economies, entrepreneurship isn’t just about starting businesses, it’s a powerful engine driving jobs and innovation, Entrepreneurship centres (incubators, BICs, accelerators, university-linked innovation hubs, venture studios) serve as the vital infrastructure that connects talent, ideas, capital, industry and markets.

Over the past decade, Pakistan has seen a growing number of Business Incubation Centres (BICs), in universities and as independent hubs, offering start-ups support ranging from mentorship and business-model advice to investor readiness and networking. These BICs have helped transform many early-stage ideas into prototype ventures and, in some cases, market-ready start-ups. This increased institutional support has enabled a start-up culture, giving founders safer environments to experiment, fail fast, learn, and iterate.

Globally, small and medium enterprises (SMEs), often nurtured via entrepreneurship centres, contribute to economic growth. In the United States, for example, small businesses have created the majority of net new jobs in recent decades. A background summary estimates that 13 million jobs were created by small businesses since 1997.[1]

This number highlights that small enterprises, often early-stage ventures supported by incubators, remain critical job creators, driving employment expansion, absorbing young or returning workers, and generating resilient economic activity. By enabling entrepreneurship, ECs thus support one of the most stable sources of job creation worldwide.

BIC’s In Pakistan: Progress, Challenges, And What Needs to Be Done

However, despite this progress, several structural challenges limit the full potential of BICs in Pakistan:

• Dramatic decline in start-up investment: Pakistan’s start-up ecosystem saw a steep funding collapse in 2023, with total investment falling to USD 75.6 million, a 77.2% year-on-year decline. Deal volume also dropped by 47.9%, with 37 deals recorded during the year. More than half of all funding came in the last quarter of 2023 (October to December), which alone saw 15 deals worth USD 38.6 million. The average investment amount start-ups received in each funding deal fell sharply to USD 2.4 million, down 60% from 2022, reflecting a significant pullback from investors and a tightening of available capital in the ecosystem.[2]

• Unstable investor sentiment and capital drought: Investor sentiment in Pakistan’s start-up ecosystem has weakened drastically, resulting in an acute shortage of capital. In the first half of 2024, start-ups managed to raise only USD 3 million, a 92% year-on-year decline, representing the largest drop among all emerging markets. Deal activity also plunged, with just five deals closed, a 77% reduction compared to the same period last year.[3] This sharp contraction reflects broader global shifts toward safer investments such as,  government treasury bills, Pakistan Investment Bonds (PIBs), real estate, and safe-haven assets such as gold, amid high interest rates, leaving Pakistani start-ups with limited access to early-stage funding and creating significant pressure on BICs and founders trying to scale and sustain their ventures. Many incubators remain oriented toward general start up training rather than facilitating deep-tech incubation, technology transfer, or industry-driven research. Without strong institutionalised tech-transfer offices or research commercialization pipelines, promising research often doesn’t translate into commercially viable ventures.

• Weak Links between academia/research and industry: Incubators focus primarily on general start-up training, while structured pathways to commercialise university research remain limited. Universities such as LUMS generate applied research in areas including AI, data analytics, energy systems, and embedded technologies, much of which hold strong commercial potential. However, without dedicated technology transfer processes, IP support, and industry pilot opportunities, research outcomes often do not progress into spin-offs or market-ready products. Strengthening collaboration between research labs, incubators, and industry partners can help unlock this potential and accelerate commercialisation.

• Limited sectoral and infrastructure support: For fields like agritech, biotech, climate-tech, deep tech, or regulation-heavy sectors (health, education), the absence of specialised labs, long-term support structures, or domain-specific mentorship limits meaningful growth.

• Low participation from women and underrepresented groups: Women remain significantly underrepresented in Pakistan’s entrepreneurial ecosystem. While women make up nearly half of the population, only around 23–25% participate in the labour force, and just about 1% are entrepreneurs.[4] This gap reflects structural barriers such as limited access to finance, markets, and targeted support programmes, which continue to restrict women’s participation in business and reduce overall equity and diversity in entrepreneurship.

• Poor post-incubation scaling support: Many start-ups “graduate” from BICs but struggle to scale because of limited access to follow-on funding, export-market linkages, regulatory support, or global exposure.

What Needs to Change (and How to Do It)

To unlock the full potential of BICs in Pakistan, stakeholders must consider several institutional reforms and strategic interventions:

• Introduce blended financing instruments: combining grants, concessional loans, and equity, to cushion against global investment cycles and reduce dependency on volatile VC funding. Similar blended finance models have been used in emerging markets in Southeast Asia, where donor-backed grants support early experimentation while concessional loans and equity are introduced at later growth stages, helping start-ups survive VC downturns.[5]
• Establish Technology Transfer Offices (TTOs): inside incubators/universities, paired with shared R&D labs and corporate-industry partnerships. This can help convert academic research into market-ready ventures. University consortia such as the UK’s SETsquared [6]partnership show how structured TTOs and industry engagement can significantly increase faculty-led spin-outs and research commercialisation.
• Develop sector-specific incubators: (especially for agritech, biotech, climate tech, AI, deep-tech), equipped with necessary lab infrastructure, regulatory guidance, and long-cycle financing. Dedicated agritech and deep-tech incubators in countries like Singapore and South Korea have enabled startups to navigate complex regulation and long development cycles more effectively than generalist incubators.[7]
• Design inclusion-focused incubator tracks:  e.g., women-only cohorts, rural micro-hubs, digital incubators, flexible scheduling, and collaborate with financial institutions to ensure accessible credit and mentorship. Women-focused incubation programmes and digital cohorts in emerging markets have consistently shown higher retention and venture formation by addressing mobility, time, and financing constraints faced by women founders.
• Offer post-incubation growth and export support: such as growth accelerators, corporate procurement pilots, international soft-landing programmes, and global market-access facilitation. Export-oriented accelerators supported by OECD member countries have helped start-ups enter international markets early, particularly in SaaS and digital services, even when domestic demand remains limited.[8]

If implemented, these can transform BICs from early-stage support units into full-fledged engines of innovation, growth, and economic resilience.

Start-up Enablers & High-Potential Sectors in Pakistan

Even amid a downturn in funding, several sectors in Pakistan continue to show strong potential, especially when supported by well-structured start up enablers.

SaaS, IT Services, and Global Digital-Services Exports

Pakistan’s expanding pool of technical talent and competitive cost base position it well for SaaS and digital services exports. With support for export-ready product development, international market access, and clear IP and legal frameworks, Pakistani tech start-ups can scale beyond domestic markets and earn resilient foreign exchange. Companies such as Afiniti and Systems Limited demonstrate how Pakistani firms can successfully serve global clients. Entrepreneurship centres can further enable this growth by helping founders navigate international sales, compliance, pricing, and customer discovery, while connecting them directly with overseas buyers.

Fintech and E-Commerce

Fintech and e-commerce remain among the most active sectors in Pakistan’s start-up ecosystem but continue to face challenges such as regulatory uncertainty, low digital trust, and high customer-acquisition costs. Clearer regulations, incentives for digital payments, and stronger financial-literacy initiatives can help unlock growth. Local ventures are increasingly building solutions suited to Pakistan’s realities. KalPay, a graduate of the LCE Incubator, shows how Buy Now, Pay Later (BNPL) models can expand consumer credit through merchant partnerships and alternative credit assessments. Yet many people without bank records or formal income proof remain excluded from basic financial services, creating opportunities for platforms that use alternative data and simplified digital on boarding to advance financial inclusion and scale sustainably.

Logistics & Mobility

Given Pakistan’s infrastructure constraints and wide geography, logistics and mobility start-ups have real potential, particularly in urban transport, freight, delivery, and supply-chain optimisation. However, high capital needs, fuel price volatility, and regulatory fragmentation (inter-provincial, municipal) remain big challenges. Support can come via “logistics-as-a-service” models, EV transition funding, and regulatory harmonisation across provinces.

Agritech & Rural-Focused Innovation

Agriculture remains a backbone of Pakistan’s economy. Start-ups offering precision farming, digital advisory, supply-chain solutions, rural fintech, and smart-input distribution can revolutionize productivity and income. Success will require practical, on-ground support such as offering farmers combined services, affordable credit, reliable advisory, and access to markets, along with small rural incubators, partnerships with agricultural extension departments, and programmes that make digital devices cheaper and easier to use.

HealthTech and EdTech

Digital health and education solutions, especially telemedicine, remote learning, skill-based edtech, hold long-term promise. But to flourish, they need regulatory clarity (for telehealth, online education), compliance support, partnerships with institutions (hospitals, schools), and investment in trust-building among populations.

Artificial Intelligence (AI) and Tech Integration

Artificial Intelligence is emerging as a high-potential growth area across Pakistan’s tech ecosystem, supporting innovation in sectors such as SaaS, fintech, health, agriculture, and logistics. With growing technical talent and access to cloud-based tools, start-ups are increasingly integrating AI into products and services. However, wider adoption depends on reliable, uninterrupted internet access, affordable computing resources, and data availability. With the right support, AI can act as a powerful enabler of productivity and technology integration across the economy.

What Global Trends Mean for Pakistan and What Should Be Adapted

Globally, entrepreneurship centres are evolving rapidly. There is a shift toward deep-tech incubation, venture studios, AI-centric accelerators, and export-oriented start up models. The essence: ECs are no longer just support hubs for random founders, but strategic infrastructure labs, funding mechanisms, global market pipelines, and institutional bridges between research and commercialization.

For Pakistan, this evolution means BICs must grow beyond training and mentorship. They must become research-enabled, industry-linked, export-oriented platforms. They must align their programmes with global demand, support long-cycle innovations, and embed inclusion (gender, rural, underserved sectors) into their mandate.

Conclusion: Toward an Innovation-Driven Economy

Entrepreneurship centres are arguably the single most powerful institutional lever to build a resilient, innovation-driven economy in Pakistan. If we strengthen BICs, build deep-tech infrastructure, enable sector-specific incubation, stabilise funding flows, and facilitate global linkages, we can unlock start up potential across SaaS, agritech, fintech, health, logistics, and more.

The transformation will not be easy; it requires coordinated action from universities, investors, government, regulators, and ecosystem builders.

By investing in entrepreneurship centres as national infrastructure, Pakistan can move beyond surviving, towards thriving as a knowledge-driven, globally competitive economy.

References

^[1] “What Does Entrepreneurship Do for Job Creation? | Economic Impact Catalyst,” n.d. https://www.economicimpactcatalyst.com/blog/entrepreneurship-job-creation.

^[1] Business Recorder. “Pakistan’s Startup Funding Falls 77.2% in 2023.” January 1, 2024. https://www.brecorder.com/news/40281509.

^[1] BR web desk. “6 Months of 2024: Pakistan’s Startup Funding Falls 92%, Amounts to Measly $3mn.” Business Recorder, July 10, 2024.

^[1] Jalal, Asif. “From Kitchens to Corporations: Pakistan’s Women Entrepreneurs Creating New Narratives.” Associated Press of Pakistan, February 2, 2025.

^[1] IFC. “The Role of Blended Finance in an Evolving Global Context,” n.d. https://www.ifc.org/en/insights-reports/2025/role-of-blended-finance-in-an-evolving-global-context.

^[1] SETsquared. “SETSquared Partnership | The University Enterprise Collaboration.” SETsquared, December 23, 2025. https://www.setsquared.co.uk/.

^[1] “Global Deep Tech Ecosystems: Catalyzing Innovation for Sustainable Development.” UNDP, 2025.

^[1] OECD. “Incubation and Acceleration Tools for Entrepreneurship Promotion.,” n.d. https://www.oecd.org/en/about/projects/incubation-and-acceleration.html.

[1] “What Does Entrepreneurship Do for Job Creation? | Economic Impact Catalyst,” n.d. https://www.economicimpactcatalyst.com/blog/entrepreneurship-job-creation.

[2] Business Recorder. “Pakistan’s Startup Funding Falls 77.2% in 2023.” January 1, 2024. https://www.brecorder.com/news/40281509.

[3] BR web desk. “6 Months of 2024: Pakistan’s Startup Funding Falls 92%, Amounts to Measly $3mn.” Business Recorder, July 10, 2024. https://www.brecorder.com/news/40312224.

[4] Jalal, Asif. “From Kitchens to Corporations: Pakistan’s Women Entrepreneurs Creating New Narratives.” Associated Press of Pakistan, February 2, 2025. https://www.app.com.pk/national/from-kitchens-to-corporations-pakistans-women-entrepreneurs-creating-new-narratives/?utm_source.

[5] IFC. “The Role of Blended Finance in an Evolving Global Context,” n.d. https://www.ifc.org/en/insights-reports/2025/role-of-blended-finance-in-an-evolving-global-context.

[6] SETsquared. “SETSquared Partnership | The University Enterprise Collaboration.” SETsquared, December 23, 2025. https://www.setsquared.co.uk/.

[7] “Global Deep Tech Ecosystems: Catalyzing Innovation for Sustainable Development.” UNDP, 2025.

[8] OECD. “Incubation and Acceleration Tools for Entrepreneurship Promotion.,” n.d. https://www.oecd.org/en/about/projects/incubation-and-acceleration.html.

The post How Entrepreneurship Centres Are Powering Today’s Economy appeared first on LUMS Centre for Entrepreneurship.

The discussion focused on three key areas relevant to Pakistan’s context:

• Developing inclusive training modules for women and creative entrepreneurs.

• Designing sector-specific incubation programs that align with regional strengths such as agriculture, crafts, and tourism.

• Strengthening university–industry linkages for long-term, sustainable impact.

The post Designing Inclusive and Sector-specific Incubation Models: Insights from RGU Scotland appeared first on LUMS Centre for Entrepreneurship.

Pakistan has a rapidly growing community of passionate game developers and animators who are either working with software companies and gaming studios or freelancing their talents. With its presence in Karachi and Lahore, CEGA seeks to uplift this talent pool, elevate it to a global level, and position Pakistan as a regional hub for gaming and animation. Through this initiative, start-ups can apply to the CEGA incubation programme, receive mentorship from industry experts, attend training workshops, utilise co-working spaces, and gain access to valuable investment opportunities.

As a knowledge partner, LCE will contribute through specialised workshops, training sessions, and curriculum development, ensuring that incubated developers, animators, and entrepreneurs not only gain technical expertise but also the entrepreneurial skills needed to make their mark in the global creative economy.

Jazib Zahir, Director, LCE, shares, “LCE is very excited to support the nationwide CEGA initiative. Gaming and animation are among the most dynamic industries today, and through CEGA, entrepreneurs in these sectors will be encouraged to take their ideas further and scale them into more impactful ventures through mentorship and training. The trainings will focus on key areas such as building prototypes, collecting and analysing data, identifying market needs, and much more. There is immense potential in gaming and animation, and through CEGA, entrepreneurs will gain a structured, disciplined approach to succeeding in these creative fields.”

LCE’s participation in CEGA reinforces the Centre’s commitment to driving economic growth and innovation in Pakistan by nurturing start-ups across diverse industries, including gaming and animation.

For more details, please visit https://cega.com.pk/

The post LUMS Centre for Entrepreneurship Joins Consortium to Manage the Centre of Excellence in Gaming and Animation (CEGA) appeared first on LUMS Centre for Entrepreneurship.

Cities are economic hubs with industries supported by large, culturally diverse labour forces. Often tagged as ‘engines of growth,’ urban metropolises act as the backbone of entrepreneurial economic activity. The quality of this economic activity relies heavily on the well-being and productivity of the workforce. While labour productivity is determined by a multitude of factors, aspects of the ‘workspace’ are often neglected and even understudied in the Pakistani context.

The physical and psychosocial features of people’s work environments have a significant impact on their well-being and performance. This is also true for the entrepreneurial ecosystem, including workspaces for start-ups. Start-up founders are known for their passion and determination, often translating into long working hours, extended periods spent in brainstorming and ideating on laptops, team meetings, and networking. There is a constant cycle of hustle, where a conventional 9 to 5 schedule is rarely observed, as start-up founders juggle multiple roles and switch gears constantly to maintain steady momentum. Yet, start-up founders seldom have office space of their own. In Pakistan, several founders opt for coworking spaces and start-up incubation labs to build their enterprises, and these spaces become their ‘office’ for the duration of their initial business development.

University-Based Incubators: Bridging Academia and the Market

Incubators at Higher Education Institutes are playing a pivotal role in economic growth, innovation, and entrepreneurship throughout the world.

In Pakistan, university-based incubators are being recognised as a critical platform that bridge the connection between academic knowledge and the market by supporting start-ups. While significant effort and progress have been made in other aspects, such as managerial, organizational, and training frameworks, the ergonomic design is often overlooked.

Ergonomic design seeks to enhance comfort, efficiency, and safety by tailoring designs to fit the physical and cognitive needs of the users. This article will explore how the spatial and ergonomic needs of incubators in Pakistani HEIs should be designed to facilitate creativity, learning, and collaboration by looking into the spatiality and spatial orientation in coworking settings in Pakistan. It offers evidence-based recommendations for ergonomic design to deal with “invisible challenges” that help increase the overall productivity of the workforce.

Ergonomics refers to the technology of work that understands and improves human interactions while incorporating biological sciences, including psychology, anatomy, and physiology, aimed at human efficiency while minimizing the risk of injury. Ergonomics considers the dimensions of the body, the application of forces the expenditure of energy, the effects of the physical environment, and information processing and decision making[1]. Ergonomics is not only restricted to physical adjustments but also includes psychological factors, such as how individuals interact with their environment. Meanwhile, ergonomic design seeks to enhance comfort, efficiency, and safety by tailoring designs to fit the physical and cognitive needs of the users. One of the key aspects of ergonomic design is the application of anthropometric data, including measurements and statistics related to human body dimensions. Ergonomic design principles are essential in creating furniture in an office and workspace that fits the needs of each individual, leading to increased productivity. comfort and reduced stress levels[2].

As Pakistan’s entrepreneurial ecosystem familiarises itself with incubation centres, it is fostering a culture of innovation by providing start-ups with resources to turn their ideas into viable products and prototypes. It is important to consider the long-term interests of the start-up and consider the capacity of incubators at an intermediate stage. Networking is essential for collaboration and the acceleration of any entrepreneurial venture. Coworking spaces and labs serve as catalysts for networking within your local entrepreneurial ecosystem. For this reason, incubators in Higher Educational Institutions need to consider the design of their workplace in a way that enables productivity as well as interaction

With around 250 coworking spaces and at least 30 incubation centres across Pakistan, there is a significant shift in the entrepreneurial ecosystem of the county, these spaces offer a collaborative work environment along with amenities like mentorship and trainings for growing start-ups. As these centres look towards building spatial capacity to cater to the need of start-ups, the design element of these spaces is often overlooked and they fall short in infrastructural planning and design due to the lack of integration of cultural contexts.

“State-of-the-art” spaces are usually technology-driven, they follow a generic template without contextual spatial considerations and have a hostile infrastructural design that creates a stressful, fast-paced environment, which doesn’t necessarily mean hyper productivity but alienation from the community, around. This mitigates the whole point of a coworking open-layout space. It has been shown that offices that are not designed to optimize surveillance and efficiency using bright lights, and prioritize spatial zoning, to reduce noise levels and other distractions, promote individual well-being and growth while boosting morale and employee output.

Young entrepreneurs in Pakistani higher education institutes often move from flexible informal schedules to more structured hours that typically involve prolonged sitting and sedentary behaviour, which is “any waking behaviour characterised by an energy expenditure ≤1.5 metabolic equivalents (METs), while in a sitting, reclining or lying posture[3],” which leads to fatigue and reduced productivity. This behaviour has been linked to many negative health outcomes such as muscle discomfort, cardiovascular risks and metabolic issues, as well as fatigue[4]. Integrating organisational culture into office spatial design can positively influence employees’ psychological well-being and reduce fatigue. Workspaces that embed cultural elements like separate prayer areas for women and daycare can significantly enhance employee well-being and shows how integrating organizational culture into office spatial design can positively influence employee’s psychological cognition (Hu & Zhang, 2022). One of the significant findings from this study shows that workspaces embedding cultural elements significantly enhances employee’s wellbeing and engagement. This highlights that working spaces in BIs should be built while keeping in mind the ergonomics to enhance the cognition and productivity of employees.

“In this space, ideally, you should have events for the community. You should have separate spatial zones for networking and gaming, like the already present common room.” – Fareed, Resident at the LCE Coworking space

The Problem

Spatial design is not just limited to aesthetics but is essential for productivity as ergonomics influences cognitive performance, reduces stress, and improves the productivity of workers. Businesses that adopt ergonomic interventions see a 25% improvement in productivity on average. A study done by CSRC Global on “Business Incubators in Pakistan: State of the Art and Future Outlook” supports the role of spatial design in business incubation centres in Pakistan, highlighted effective business incubation centres provide not only administrative and technical support but also a social and collaborative environment that supports entrepreneurial success. The study emphasises that well-designed incubation spaces promote interaction and networking, resulting in reducing isolation and stress. The physical layout of these centres includes open workspaces, communal areas and informal meeting spots which encourage social connectivity and peer support, enhancing mental well-being and confidence.

“Co-working spaces allow for more collaboration with people around us, rather than being in a single office space. The best thing to have happened here was that I came across so many women entrepreneurs and their stories, they were amazing, and I realised that age, race, and gender didn’t matter- all that did was their passion. The mentorship we give each other is invaluable. People come to us, we go to them, and we help each other out.” – Quratulain, Resident at the LCE Coworking Space.

This social dimension of spatial design is crucial in start-ups and sustaining entrepreneurs’ motivation and productivity. Many Pakistani business incubators and universities are still evolving to meet these needs, effectively suggesting that improving spatial design and facilities can substantially increase their impact to better assist young entrepreneurs in managing psychological and physical challenges of structured working hours. It has been shown that office workers with optimized daylight conditions performed 10-25% better on cognitive function tests than those workers had poor lighting conditions. Another study revealed that air conditions in working spaces, such as low ventilation and increased levels of indoor air pollutants, reduce cognitive performance by 50% in comparison to those individuals that are in well-ventilated spaces[5],[6]. Another major factor includes temperature regulation; multiple studies show that thermal comfort is different for both genders which can make it hard to accommodate both in the same space. Data reveals that “men are at their cognitive best at 68-69 farenheight while women’s cognitive peak is from 70-72.” [7].

Menstruating individuals are disproportionately impacted and their productivity compromised. All these environmental factors contribute to the overall cognition, productivity, and well-being of the employees, revealing that ergonomics plays a key role in and should be integrated into Business Incubators.

Global Practices

Incubators around the world have become places that go beyond their traditional function of finding funding and mentorship; they have become hubs for innovation and creative problem-solving. Globally, as incubators transcend their traditional roles, they have embraced spatial considerations to foster collaboration and creativity, which has had an impact on the overall well-being and success of the start-up communities. Sweden, Japan, and Singapore are case studies for built space and its impact. Scandinavian incubators follow Nordic design principles – simplicity, functionality, and user well-being, and incorporates cultural practices like “fika” (informal coffee breaks) and adds soft design interventions into the institutional design, helping create relaxed communal zones that improve collaboration and long-term retention[8]. Japanese incubators prioritise efficiency through creating an environment that promotes mental clarity. Shibuya QWS Tokyo used spatial zoning to reduce an overload of audio-visual stimuli, for this they use privacy pods, acoustic panelling, and ambient lighting, as studies show that reduced sensory stimulation reduces fatigue and improves focus by up to 35% (SAITO et al., 2019). Japanese incubators use modular furniture that is designed based on the national average anthropometric data. Japanese incubators follow a human centric design which include zen gardens and incorporation of natural elements such as plants or water vies which help in managing stress levels[9]. Lastly, Singapore takes up an intersectional approach towards design where they prioritise inclusivity and cutting edge functioning smart ecosystem. Incubators like BLOCK71 use IoT-enabled lighting, sleeping pods, prayer rooms, flexible lab spaces, and gender-inclusive restrooms. Additionally, due to Singapore’s mandated green mark certification for buildings, there is better air quality and focus on improving the environmental health of the workplace[10].

Recommendations for Pakistan

Pakistan can learn from global best practices while tailoring local solutions. The concept of employee happiness has been studied in western countries through culturally specific lenses, which cannot be well implemented into Pakistani cultures. Entrepreneurial labs and coworking spaces in Pakistan must promote diversity and inclusivity, and while designing interventions to enhance productivity and performance, it is essential to make employees feel valued at the workplace to build morale. For this, it is important to integrate their personal values into the design and promote community building.  Culturally adaptive design, such as prayer areas and tea areas for short breaks can provide restorative downtime to start-ups as well as an opportunity to socialise informally. This design is also a step towards spatial zoning, as the needs of the constantly developing urban start-ups have evolved beyond open-space layout design, as it does not provide a sustainable work environment.

Spatial zoning allows the user to opt for focus zones, networking zones, and quiet zones, depending on their need throughout their workday. Ergonomic infrastructural design beyond the “one-size-fits-all” furniture that incorporates anthropometry, and adjustable design allows users to work comfortably for long periods. Since start-ups have unconventional work hours, with many of them working through the night, environmental well-being becomes an important factor.

Lack of diversity is another problem that persists in Pakistan. Inclusivity measures like space accessible to people of all disabilities should be factored in when designing workspace, which not only is beneficial for disabled people, but makes the space more functional for all users. Amenities for menstruating individuals, like comfortable chairs and heating features, should be made available.

Well-ventilated spaces with maximised natural light have been shown to improve cognitive function and reduce fatigue. Green design that incorporates nature in the interior, such as outdoor working spaces and rooftop gardens, can reduce stress. Lastly, the Higher Education Commission Pakistan and its partner organisations need to establish developmental guidelines that can serve as a capacity building blueprint made with the support of architects, health experts, and policymakers to create an environment that is not only functional but supportive and conducive to long-term entrepreneurial success.

Conclusion

Ergonomic design and spatial considerations are essential for productivity and promoting innovation and wellbeing. With Pakistan’s urban entrepreneurial ecosystem rapidly progressing to keep up with entrepreneurial trends and accommodating a generationally diverse group of entrepreneurs, it is important to move away from the one size fits all mindset and integrate adaptive design principles that prioritize both physical and mental wellbeing of founders and employees. Infrastructural models that integrate culturally relevant design into spatial zoning of workplaces, like prayer rooms or focus pods, help achieve a balance between focus and networking, foster collaboration and enhance creativity.

Drawing lessons from global practices, incubators in HEIs in Pakistan must tailor local solutions to create a human-centric environment that is inclusive, functional, and culturally responsive. These measures would ensure a steady development of the relatively new entrepreneurial ecosystem in Pakistan by focusing on spaces that support innovation and collaboration, especially because the success of start-ups is directly proportional to the environment that nurtures it. And when entrepreneurs thrive in their environments, the ecosystem and the economy thrive with them.

[1] https://doi.org/10.1080/00140139.2018.1502817

[2]https://ehs.oregonstate.edu/sites/ehs.oregonstate.edu/files/pdf/ergo/ergonomicsanddesignreferenceguidewhitepaper.pdf

[3] https://www.sedentarybehaviour.org/what-is-sedentary-behaviour/

[4] Sedentary behavior: emerging evidence for a new health risk – PubMed

[5] Is CO2 an indoor pollutant? Direct effects of low-to-moderate CO2 concentrations on human decision-making performance – PubMed

[6] A systematic review of ventilation conditions and airborne particulate matter levels in urban offices – PubMed

[7] Quantitative measurement of productivity loss due to thermal discomfort – Welcome to DTU Research Database

[8] Frontiers | Outdoor Office Work – An Interactive Research Project Showing the Way Out

[9] 渋谷川流域の住宅地における暗渠上路地の空間構成

[10] https://maisonoffice.vn/en/news/green-mark-certification/

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“Change is the only constant” – this is a phrase Salman Iqbal doesn’t just say in conversation; it’s a statement he embodies. Two years ago, Mr. Iqbal exited from a company he took 25 years to build from the ground up, not to rest or retire, but to build another company from scratch, this time within a completely new technology landscape. His tenacity and courage to continue reinventing himself to build start-ups and products that have a deep business impact for his clients is something that has the power to inspire a whole generation of entrepreneurs navigating the current landscape.

Mr. Iqbal’s Denovonet is currently housed at LCE and develops advanced, next-generation solutions leveraging Artificial Intelligence and Machine Learning technologies to enhance transaction monitoring processes for financial institutions.

We sat down with him to hear about his entrepreneurial journey and get his perspective on the new technologies he’s working with, as well as the mindset required to keep growing as a start-up founder.

Q — You started your career as an electrical engineer. Could you tell us more about your transition from pursuing a PhD in Electrical Engineering to become a founder of your own software company?

A — I got the opportunity to work in capital and financial markets, which was a complete 180-degree flip, because I was an electrical engineer by profession, with my undergraduate and PhD completely focused on tech. There was not an iota of learning towards business during my academics. But I wanted to do something completely different. I wanted to stay in Pakistan and contribute here.

Three years into doing a job focused on automating capital markets in Pakistan, our team accomplished some major objectives: replacing the manual trading floor with fully screen-based trading country-wide and contributing towards an electronic share depository, and developing a unified national clearing and settlement system. Most of the targets were accomplished, at least whatever I thought I would like to do, I had done. Teams were trained, and a very capable team was left behind to continue the progression. I thought that now was the time; I’ve got a good understanding of the financial sector, current business needs, and pain areas to design solutions that make their processes more capable and efficient. We deep dived, took measured risks and started a business venture. I had some investors on board so I started Softech Systems in 1998, which was the beginning of my 25-year journey building the company.

Q — You worked with a lot of international clients while leading Softech Systems, what was that experience like?

A — We were fortunate to work with some leading players in the tech industry. Early on, we had the opportunity to work as development partners with EFA Software Services, based in Calgary, Alberta, which developed capital market solutions. Our exposure to the Canadian market led to more breakthroughs, the most exciting being our partnership with Concept Wave, a Toronto-based company that developed and marketed product care and order catalogue solutions for leading telecom operators globally. Softech was fortunate to convince them of our ability to be their partners in development and implementation worldwide. We completed numerous implementations across several continents for leading telecom providers. The company was sold to Ericsson, the world’s leading telecom provider, and we continued working with them as well.

During our decade-long partnership with Ericsson, we collaborated on and implemented many solutions with some of the most prestigious telecom providers worldwide. Notable implementations include Turk Tel (Turkey), Ziggo (Holland), BMW (Munich), Hutchison (Hong Kong), Thai Tel (Bangkok), STC (Saudi Arabia), and Etisalat (Dubai). Most of this work was achieved through relationship building and personal networking. As pilots succeeded, we received larger and more challenging projects, strengthening our relationship with Ericsson. Additionally, we are very proud to have developed Pakistan and Ghana’s National Clearing and Settlement System. We also designed solutions in brokerage, online trading, and asset management sectors, which operate across many continents. Our teams got massive exposure working across different cultures and in so many different domains.

Q — You could have easily retired after exiting Softech Systems, why did you choose to go through the challenge of starting another company from scratch?

A — I dedicated 25 years to a company, driving its growth, delivering strong returns to investors, and achieving significant personal success. However, there came a point when the work began to feel static, repetitive motions without the momentum of new possibilities. Rather than continually trying to convince stakeholders to embrace a fresh vision, I decided to start with a clean slate. Having already explored various ventures in my entrepreneurial journey, I understood the challenges of building something from the ground up, but I was equally aware of the rewards in the form of personal nurturing, knowledge growth, and substantial upside if it succeeded.

Q — How is Denovonet positioned to help companies leverage AI/ML effectively?

A — Initially, our focus was on learning and experimentation, taking existing solutions and enhancing legacy systems with Artificial Intelligence and Machine Learning to make them more effective and productive. Today, our goal is to help businesses unlock the full potential of their data through AI, machine learning, and advanced analytics. We aim to transform complex data into actionable insights that drive smarter decisions, greater efficiency, and stronger returns. This means embedding intelligent technologies into everyday operations and fostering a data-driven culture that delivers lasting value. At present, we are developing high-accuracy anomaly detection for financial transactions, combining advanced rule-based methods with machine learning to provide deeper insights and better process efficiency reducing manual interventions.

Q — In your opinion how has AI changed the future of work and are current graduates equipped for this new landscape?

A — The future of work is changing in real, tangible ways—it’s not just speculation. We either learn and adapt to these new technologies, or we risk being left behind. The traditional approach to software development is fading fast. Much of the code that used to be written by software engineers is now being generated by AI, and the few gaps the technology has today will inevitably be closed shortly. This shift is transforming the job landscape: some roles will become obsolete, but entirely new opportunities will also emerge, provided we have the skills to seize them.

Take, for example, the role of prompt engineer—a job title that didn’t exist until recently. Its emergence signals how deeply companies intend to integrate AI into their operations. And it’s not just a “tech job.” A prompt engineer needs strong domain expertise as well. If the task is to generate financial models, you need a solid background in finance, not just technical know-how.

Unfortunately, most of our graduates are not ready for this multidimensional future of work. A few are, but often because they’ve taken the initiative to upskill themselves. In many universities, faculty members remain comfortable teaching outdated knowledge. As a result, graduates enter the job market with skills that are out of sync with the demands of emerging roles. To close this gap, both curricula and faculty training must be updated through targeted initiatives and national-level programs to prepare our workforce for the realities of tomorrow.

Q — How can the government and other stakeholders support AI adoption in the country?

A — The security implications of this technology are substantial. When dealing with data, particularly sensitive personal information such as health records or travel schedules, privacy concerns become paramount. This is why governments and organizations must prioritize the introduction of robust regulations, such as comprehensive data protection laws, to ensure that individuals feel confident their information will be used solely for its intended purpose and not shared with marketers or other unauthorized parties. Clear regulations, laws, and enforcement procedures are critical, and this remains a global challenge.

Another urgent issue is the need to tackle data bias. Many AI systems inherit biases from the data they are trained on, which can lead to discriminatory results. To prevent this, regulations must include measures to identify and remove bias, making sure that technology does not marginalize or demean specific communities. This might involve masking certain parameters and implementing practices that keep datasets as neutral and representative as possible.

Q — What advice would you give to entrepreneurs navigating today’s fast-changing landscape?

A — First, acknowledge that this technology is here to stay. Every organization ultimately exists to serve customers and drive sales, and if an AI-first solution proves more cost-effective and capable than a traditional one, consumers will choose it. Human intuition, while valuable, is limited compared to what AI can achieve with data. Traditional methods have their limits; to truly understand customers, AI and machine learning can uncover patterns and trends hidden within the data you already possess.

This represents a fundamental shift—AI agents are beginning to replace many traditional SaaS models. That change cannot be stopped, so it must be embraced. Re-educate yourself, stay informed, and be open to learning from those around you. Recognize your gaps and bring in the right expertise to realize your vision. You may have the domain knowledge and strategic insight, while others contribute deep technical skills. Together, you can create solutions that are not only relevant today but also resilient and competitive in the future.

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Clean technology, also known as cleantech, refers to products, services, and processes that use renewable materials and energy sources, reduce emissions and waste, and have a minimal impact on the environment. In Pakistan, cleantech is crucial for addressing environmental challenges, enhancing energy security, and fostering sustainable economic growth.

Pakistan’s Energy Landscape[1]

• Pakistan’s energy sector relies heavily on fossil fuels. The country has a total installed power generation capacity of approximately 41,000 MW, with 65% of it coming from fossil fuel sources. (United Nations Development Program)
• The demand for energy is rising by 8-10% annually, driven by population growth and urbanization. Despite a surplus capacity of 12,000 MW, the country is not able to supply grid-based electricity to over 23 percent of the population.
• The country is facing significant energy challenges, including high costs and energy shortages.More than 40 million Pakistanis remain without electricity, and half the population lacks access to clean cooking facilities that use cleaner fuels or modern stoves.
• Pakistan also faces environmental challenges including rising pollution levels, water scarcity, and high energy demands, driven by population growth and industrialisation.

Clean Tech Opportunities

a) Renewable Energy:

Solar, Wind, and Hydropower: Pakistan has immense potential for harnessing renewable energy, with solar and wind energy resources particularly abundant.

b) Sustainable Agriculture:

Pakistan’s agriculture sector is crucial to its economy, but traditional farming practices are resource-intensive and contribute to environmental degradation.

Precision Agriculture: Implementing cleantech solutions like sensors, drones, and AI can optimize water usage, reduce pesticide dependence, and increase yields.

Agro-solar Technologies: Dual-use systems that combine agriculture and solar energy can enable farmers to produce crops and generate electricity simultaneously.

c) Water Management:

Water scarcity is a significant issue in Pakistan, with inefficient water use in agriculture, pollution of freshwater sources, and mismanagement of water infrastructure.

Cleantech Solutions: Smart irrigation systems, water recycling, and desalination technologies can be key to managing water resources sustainably.

Hydrological Monitoring: Using IoT sensors and data analytics to track and manage water distribution in real-time.

d) Waste Management:

With increasing urbanization, waste generation has surged, leading to landfills overflowing and mismanagement of hazardous waste.

Circular Economy Practices: Encouraging recycling, upcycling, and waste-to-energy technologies can reduce landfill dependence and generate additional resources.

Biomass Energy: Using organic waste to generate bioenergy can contribute to both waste reduction and clean energy production.

Benefits of Clean Tech for Pakistan

Economic Growth and Job Creation: Transitioning to cleantech industries, including renewable energy, waste management, and water efficiency, could open new sectors and create jobs.

Environmental Protection: Clean tech can reduce Pakistan’s carbon footprint, slow deforestation, and prevent resource depletion, contributing to global environmental goals.

Resource Efficiency: Cleantech solutions, especially in agriculture and water management, can promote sustainable resource use, preventing future scarcity issues.

Challenges Faced:

Policy and Regulatory Barriers: Lack of streamlined policies, slow regulatory approvals, and inconsistent incentives impede CleanTech adoption.

Financial Constraints: High upfront capital costs, limited access to green financing, and lack of venture capital interest in CleanTech startups hinder growth.

Infrastructure Limitations: Inadequate grid infrastructure for renewable energy integration and outdated distribution systems.

Public Awareness: Limited understanding of CleanTech benefits among businesses and consumers slows the adoption of sustainable technologies.

Skills Gap: Lack of technical expertise in CleanTech innovation and maintenance impairs the sector’s scalability.

Government Initiatives:

Alternate and Renewable Energy Policy 2019: Targets 30% renewable energy by 2030 and offers tax incentives to CleanTech investors.(Government of Pakistan. Alternative and Renewable Energy Policy 2019).[2]

Net Metering Regulation: Allows consumers to sell surplus electricity generated from renewable sources back to the national grid.

Green Financing by State Bank of Pakistan: Offers concessional loans for renewable energy projects through various green financing schemes.

Pakistan Clean Green Initiative: Focuses on promoting sustainable urban development, water conservation, and tree plantation.

Electric Vehicle Policy: Tax exemptions and subsidies encourage local EV manufacturing, with up to 50% exemption from duty and taxes on import of HEVs ( Hybrid Electric Vehicles) . The policy aims to transition 30% of new vehicles to electric power by 2030.[3]

Trends and Opportunities:

The CleanTech sector in Pakistan is witnessing rapid evolution, spurred by advancements in technology and growing public awareness of environmental concerns. One emerging trend within the sector is the increasing focus on urban sustainability initiatives. Cities such as Karachi, Lahore, and Islamabad are adopting CleanTech solutions to address urban pollution, traffic congestion, and waste management issues. Smart cities powered by renewable energy, integrated waste-to-energy solutions, and sustainable infrastructure are becoming focal points for both government and private sector collaboration. For instance, several CleanTech startups are now focusing on creating smart waste management systems that use AI, IoT sensors, and data analytics to optimize waste collection, recycling, and disposal, reducing landfill reliance.

In addition, the agriculture sector in Pakistan is poised for transformation through CleanTech innovations such as vertical farming and aquaponics, which offer resource-efficient solutions to feed a growing population with minimal environmental impact. These technologies, which combine agriculture with aquaculture, not only conserve water but also provide a sustainable alternative to traditional farming. Moreover, the increased availability of affordable solar-powered water pumps is revolutionizing irrigation practices in rural areas, helping farmers reduce dependency on costly and polluting diesel pumps.

As part of Pakistan’s CleanTech future, the country’s burgeoning electric vehicle (EV) market holds significant promise. With government policies promoting EV adoption and manufacturing, Pakistan’s potential as a key player in the electric mobility market is on the rise. By supporting the local production of EVs, Pakistan is positioning itself to capitalize on global trends toward electric transportation while reducing its dependence on fossil fuels. The development of EV infrastructure, including charging stations and battery recycling facilities, will be key to realizing the full potential of this green transition.

The Future of Clean Tech in Pakistan:

Collaborative efforts between government bodies, the private sector, and international organizations are essential to drive the cleantech agenda forward. Innovations such as blockchain in energy distribution, AI in water management, and bio-based technologies in agriculture are likely to shape the next decade of cleantech development in Pakistan.

In Pakistan, emerging technologies like blockchain and artificial intelligence (AI) are increasingly being explored to address the country’s pressing energy and water challenges. Blockchain has the potential to decentralize the energy market by enabling transparent peer-to-peer (P2P) trading of excess electricity generated from solar panels, especially important in urban areas adopting rooftop solar through net metering. It can also streamline billing systems, improve grid accountability, and verify the authenticity of green energy sources, supporting Pakistan’s goal of increasing renewable energy to 30% by 2030. On the other hand, AI is proving to be a powerful tool in improving water management across sectors. In agriculture, which consumes over 90% of the country’s freshwater, AI-driven systems can analyze real-time weather, soil, and crop data to optimize irrigation schedules, significantly reducing water waste. In urban settings, AI can help monitor and detect pipeline leakages, predict consumption trends, and manage distribution systems more efficiently. Projects in provinces like Punjab and Sindh are beginning to integrate these technologies into smart farming and water governance frameworks, showing promising potential for scaling. Together, blockchain and AI represent critical tools in building a more sustainable, data-driven approach to energy and water resource management in Pakistan. Engaging local communities and raising awareness about clean technologies will accelerate adoption at the grassroots level.

Clean tech is no longer an option but a necessity for Pakistan. The country’s environmental challenges, coupled with economic and social opportunities, present a case for urgent and widespread adoption of clean technologies across energy, agriculture, water, and waste management sectors.

Conclusion:

In conclusion, the current scenario of CleanTech in Pakistan is marked by remarkable progress and growing recognition of its critical role in addressing environmental challenges and ensuring sustainable economic growth. As global climate concerns intensify, Pakistan is witnessing a surge in CleanTech initiatives aimed at renewable energy, waste management, water conservation, and carbon reduction. The sector is benefiting from increased investments, both local and international, along with policy incentives provided by the government to encourage green innovation.

The emphasis on public-private partnerships, international collaborations, and research-driven approaches is accelerating Pakistan’s transition toward a greener future. By fostering entrepreneurship and creating an ecosystem conducive to sustainable practices, CleanTech in Pakistan has immense potential to address pressing environmental issues while contributing to economic resilience.

Notable CleanTech Start-ups and Companies:

Reon Energy: Specializes in solar energy solutions for commercial and industrial clients.

Pantera Energy: Provides end-to-end solar power solutions, including residential and industrial projects.

EcoEnergy: Focuses on providing off-grid solar energy solutions to underserved areas.

Baykee Solar: A tech-driven solar platform offering affordable solar financing solutions.

TrashIt: Promotes recycling and composting to encourage sustainable living habits and waste reduction.

EcoPak: Offers biodegradable packaging solutions to replace single-use plastics, aiming to reduce environmental pollution

Breathe IO: Develops IoT-based portable air monitors and purifiers to improve indoor air quality, addressing urban air pollution challenges.

Jaan Pakistan: Focuses on affordable energy solutions for low-income communities, including solar thermal cookers to reduce reliance on solid fuels.

MyWater: Offers eco-friendly water purifiers utilizing advanced filtration technologies to provide sustainable drinking water solutions.

Code Green PK: An eco-friendly eCommerce platform offering reusable and sustainable products to promote zero-waste lifestyles.

SWAP BEV: Focuses on electric vehicle solutions, contributing to the development of sustainable transportation in Pakistan.

Concept Loop: Develops technology-driven solutions aimed at enhancing energy efficiency and reducing environmental impact.

LUMS Center for Entrepreneurship (LCE) has also launched various cleantech startups focusing on sustainable solutions for energy, waste, and water management.

Aabshar: Tackles water scarcity, Aabshar has created an optimizing nozzle that reduces up to 98% of water wastage. The nozzle is easy to attach and also saves electricity consumption by 60%, working to reduce CO2 emissions over time.

PakVitae: Developing affordable water filtration systems for rural areas, addressing Pakistan’s water contamination issues.

Suftech Innovations: Upcycles metallised plastic waste into reusable plastic, promoting a circular economy.

Bamboo Bliss/ HUME: Eco-friendly bamboo products promoting a plastic-free lifestyle.

MetaFashion: Sustainable denim brand blending tradition with eco-friendly practices.

PakVitae: Focused on providing clean drinking water, PakVitae develops affordable, gravity-based water filtration systems using nanotechnology. Their solutions are used in both rural and urban settings to address water contamination and access issues.

Gamma Green Recycle: Incentivizes recycling by offering cash rewards, helping to establish a circular economy for waste in Pakistan.

SE Drop: Focused on combating urban water waste, SE Drop develops natural, plant-based disinfectant and anti-legionella nozzle systems for municipal and industrial pipelines.

Raftar Technologies: Promotes sustainable transport solutions by optimizing urban delivery and minimizing emissions through data-driven routing.

Trash Masti: Pakistan’s first online waste‑management platform, offering door‑to‑door collection for residential and commercial clients, e‑waste and hazardous‑waste disposal, composting, recycling, and even waste‑to‑energy services.

The LUMS Center for Entrepreneurship (LCE) plays a pivotal role in Pakistan’s CleanTech startup ecosystem, nurturing and supporting numerous innovative ventures. Our ongoing efforts include hosting a diverse array of CleanTech startups, fostering collaboration, and forming robust partnerships with environmental organizations, research institutions, and industry leaders to drive sustainable solutions.

For further details on LCE’s initiatives and contributions in the CleanTech domain, or to be added to the list of promising CleanTech startups, please contact our team at lce@lums.edu.pk.

[1] United Nations Development Program (UNDP). Energy Investments: Powering Businesses & Communities. Development Advocate, vol. 11, no. 2 (June-July 2024). https://www.undp.org/sites/g/files/zskgke326/files/2024-07/dap_-_volume_11_issue_2_-_energy_investments_-_powering_business_and_communities.pdf.

[2] Government of Pakistan. Alternative and Renewable Energy Policy 2019. Islamabad: Government of Pakistan, 2019. https://climate-laws.org/document/alternative-and-renewable-energy-policy-2019_991c.

[3] Ministry of Climate Change, Pakistan. Pakistan’s First National Electric Vehicle Policy (2019). Islamabad: Ministry of Climate Change, 2019. https://mocc.gov.pk/SiteImage/Policy/EV%20Policy%20Final.pdf.

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Written by Mahjabeen Bilal

The textile industry in Pakistan is one of the largest export-led industries in the country, employing 40% of  the workforce[1]. It is a key player in Pakistan’s economy and significantly contributes to 60% of the country’s exports and industry growth, accounting for the largest skilled workforce that includes women; however, there is a limited talent pool of women available for hiring in the textile industry due to systematic irregularities and underutilisation of the female workforce. Most women hold blue-collar positions, which offer limited scope for financial development in addition to limited opportunities for mobility in terms of career opportunities and professional growth.

Women in Pakistan face a variety of socioeconomic, political, and cultural barriers to their development, which significantly impact their quality of life. Historically, the textile industry has faced challenges regarding gender equality, working conditions, and recognition of women’s labour. As part of the Women Leadership Programme, supported by GIZ Pakistan and funded by the German Federal Ministry for Economic Cooperation and Development (BMZ), the LUMS Centre for Entrepreneurship (LCE) is collaborating with factories across Punjab to improve women’s career mobility, focusing on imparting soft skills on leadership, creating agents of change that can support greater gender-sensitive decision-making, and encouraging more females to join the industry.

The GIZ Women Leadership Programme (WLP) is designed to equip participants with the practical skills, strategies, and confidence needed to step into leadership roles. This project offers trainings that are a structured yet interactive learning experience, focusing on real-world problem-solving, financial decision-making, negotiation tactics, team management, and workplace equity. Through engaging discussions, hands-on activities, and industry-relevant case studies, participants will gain insights that go beyond theory, helping them take actionable steps toward professional growth. The training provides a platform to connect, learn, and develop leadership capabilities that will drive both individual success and broader industry change.

During Phase 1 of the project, the LCE team conducted onsite needs assessments with textile industry employees and provided an awareness session to higher management. The aim of the needs assessment activities was to understand both top-down and bottom-up challenges to women’s career growth. Insights from these activities informed the instructional design and development of the training content. The aim was to integrate these learnings to create tailored leadership curricula that addressed locational, cultural, educational, and industry-specific challenges that these women face.

Phase 1 covered five cities: Karachi, Lahore, Multan, Faisalabad and Sialkot. There were 110 women, and 55 executives across 31 factories participated in the need assessment surveys and focus groups onboarded from  the aforementioned cities in this program.

Our needs assessment activities provided us with nuanced insights relevant to the textile industry with an added layer of city-specific context. The focus groups highlighted issues such as lack of confidence and  lack of autonomy in male-dominated environments entrenched in cultural stereotypes. Women shared that prejudices regarding work-life balance and what is culturally expected of women often constrain their career growth. These challenges are not isolated but are situated within a broader socio-economic context where this intersection of gender, labour, and culture plays out. For example, caregiving and domestic responsibilities are disproportionately placed on female family members, which impacts their work-life balance. Women also spoke about the gender bias involved in the promotional processes and raised concerns regarding psychological safety, due to which many women reported having internalised insecurities regarding the way they present themselves at work.

“Self-doubt is real. We don’t even ask for promotions because we feel we’re not good enough.” — Textile Worker, Lahore

Similarly, the workshops with the textile executives provided important insights into the kind of barriers women have to face in their career advancement, including organizational culture, harassment, and the presence or absence of mentorship programs. Individuals from decision-making roles spoke about how company culture is significantly determined at the “top” and relies heavily on the leadership’s attitude towards women’s development. Executives from larger, export-oriented firms suggested greater exposure and willingness to invest in women’s professional development, while representatives from mid/smaller companies spoke about the “Seth” (male company founder) culture dominating decision-making. Executives reported that investing in leadership training for women led to measurable improvements in their performance as well as the overall workplace morale and culture.

“Women tend to be more focused and exhibit higher productivity.” — Executive Workshop, Sialkot

“Women in leadership roles tend to exhibit higher levels of commitment and empathy.” — Executive Workshop, Lahore

The findings from the needs assessment surveys showed a high interest in career growth across cities, with 100% of the women in Karachi expressing interest in leadership roles. Across cities, participants stated their main motivation for job mobility was financial benefits. Additional motivators included learning, skill acquisition, and appreciation. The main systematic barriers identified were a vacuum in mentorship, unclear promotion policies and career pathways, and a lack of developmental support.

Through our primary research surveys, it was found that women have limited participation in managerial positions, due to which, overall, there was a low interest in technical or skill training. Participants were more inclined towards training that helps them acquire soft skills such as emotional intelligence to help overcome insecurities and be more resilient; effective communication and negotiations to communicate effectively and assert themselves; and lastly, conflict resolution and workplace navigation to help navigate the conflict and prejudice in the workplace. These skills were  perceived to help them communicate more effectively and strengthen their positions in the workplace.  By focusing on these trainings, LCE’s Women Leadership Programme expects to put in place immediate micro interventions by overcoming bottlenecks and hopes to facilitate short- term behavioural changes to influence organizational culture in the long run.

The LCE team faced operational and cultural barriers to women’s participation during the training through this phase of the program. This included factories not releasing female employees for trainings due to either cultural constraints or lack of availability. City-to-city barriers and the size of the textile company were also a determinant of participation—smaller companies showed more resistance to sending in women without male guardians; others did not have enough workforce to spare female workers to go attend these sessions. It was also found that institutional biases were present when it came to factories investing in future leadership trainings, which posed as a challenge due to the lack of diversity amongst participants.

While soft skills development is essential to empower women to navigate barriers at the workplace, considering the top-down culture of the textile industry, sustainable change eventually depends on macro interventions through long-term policy reform. Company executives need to invest in organizational structures that support women’s career progression, alleviate the socioeconomic barriers to entry, and provide opportunities for capacity-building that in turn lead to an environment where women can excel. Yet, interventions such as the LUMS Women Leadership Programme supported by GIZ play an important role in bringing about cultural change—by exposing participants to tailored capacity building training on soft skills, individual agents of change are empowered. Participants will learn how leadership skills can be effectively utilised to advocate for more diverse, enabling work environments thereby acting as role models within their respective companies and social circles at large.

[1] https://ebiz.punjab.gov.pk/textile

The post Threading Change: Women Leading in Pakistan’s Textile Sector appeared first on LUMS Centre for Entrepreneurship.

As interest in the Middle Eastern market continues to grow among mature Pakistani start-ups—particularly those in the tech sector—this partnership comes at a strategic time. Many start-ups have already made inroads into the region, highlighting the growing potential for cross-border entrepreneurship.

With this MoU, both institutions aim to strengthen connections between academia and the start-up landscape, enabling long-term growth through shared learning and actionable opportunities.

“The signing of this MoU between Middlesex University Dubai’s Innovation Hub and LUMS Centre for Entrepreneurship marks a significant step forward in fostering cross-border collaboration between academic institutions in the UAE and Pakistan,” said Professor Fehmida Hussain, Head and Founder of the MDX Innovation Hub.

“By joining forces, we are creating a platform that leverages the unique strengths, resources, and entrepreneurial ecosystems of both countries. This partnership reflects our shared commitment to nurturing innovation, empowering future leaders, and building a more connected and resilient startup landscape across the region.”

The MoU outlines a broad framework of cooperation, including:

• Joint research and entrepreneurial projects focused on cross-border challenges and opportunities.
• Knowledge exchange through co-hosted workshops, guest lectures, and co-branded content that amplify regional insights.
• Start-up-focused events and competitions held in Lahore and Dubai to build innovation networks across borders.
• Short-term exchange programmes for start-ups, offering founders immersive experiences in local markets to gain direct insight and build partnerships.
• Collaborative contributions to LCE’s Knowledge Hub through articles, podcasts, and case studies that capture learnings and trends from both ecosystems.

These efforts aim not only to support mid-to-late stage startups exploring international growth, but also to enable students, faculty, and industry leaders to participate in shaping a future-ready entrepreneurial ecosystem.

Jazib Zahir, Director of LUMS Centre for Entrepreneurship, added, “LUMS Centre for Entrepreneurship is pleased to initiate collaborations with Middlesex University Dubai. We’ve found synergies in our priorities around curriculum design, knowledge sharing across geographies, and the pursuit of ventures—particularly in technical spaces. We look at this agreement as a way to give our stakeholders, particularly incubated ventures, access to additional resources and exposure.”

The MoU further reaffirms LCE’s commitment to enabling meaningful cross-border opportunities for startups while aligning with MDX Dubai’s mission to build impactful and inclusive innovation ecosystems.

Together, we look forward to shaping the next chapter of entrepreneurship between Pakistan and the UAE.

The post LCE Signs MoU with MDX Innovation Hub, Middlesex University Dubai, to Foster Cross-Border Entrepreneurship appeared first on LUMS Centre for Entrepreneurship.

Pakistan’s investment climate can be difficult to navigate for national and international stakeholders alike. This article provides a targeted overview of the aspects that influence the investment space of the entrepreneurial ecosystem, providing valuable insights from both investors and startups. Understanding these dynamics is essential for early-stage ventures looking to secure funding, scale operations, and make informed strategic decisions. By exploring historical trends, current economic indicators, and future projections, it highlights the opportunities and challenges of investing in Pakistan and gives tips on maneuvering through its evolving economic landscape.

Overview of Pakistan’s Investment Climate

Historical Context:

Pakistan’s investment landscape has evolved over the years, shaped by periods of economic liberalization, foreign capital inflows, and policy-driven shifts. While the 1990s marked a phase of privatization and deregulation, the early 2000s saw a rise in foreign direct investment (FDI) driven by improvements in macroeconomic stability and investor-friendly policies. However, external shocks, political instability, and inconsistent economic policies have repeatedly disrupted sustained growth.

Over the past decade, FDI trends in Pakistan have followed a cyclical pattern, influenced by global economic shifts, domestic policy changes, and geopolitical dynamics. The early 2010s witnessed an influx of investment, particularly in energy and infrastructure, catalyzed by the China-Pakistan Economic Corridor (CPEC), which brought in billions of dollars. However, FDI declined post-2018 due to external debt concerns, political uncertainty, and a deteriorating business climate. According to the State Bank of Pakistan (SBP), FDI inflows peaked in 2017 at approximately $2.8 billion before witnessing a decline, reaching $1.5 billion in 2022. The Covid-19 pandemic further slowed global capital movements, impacting investment inflows into the country.[1]

While there have been periods of increased inflows, recent trends indicate a concerning decline. In January 2024, Pakistan experienced a net FDI outflow of $173.2 million, marking a six-year high and reflecting growing investor apprehension amid political uncertainty and economic instability. Although there was a 32% increase in net FDI to $904 million during July–October FY25 compared to the same period the previous year, the inflows remain modest relative to the country’s needs.[2]

Beyond CPEC, sectors such as telecommunications, financial services, manufacturing, and technology startups have historically attracted substantial investment. The telecom sector, particularly with the entry of foreign players like Telenor and Jazz, received significant FDI in the early 2000s. The banking sector saw interest from international financial institutions, while manufacturing—especially in textiles and consumer goods—remained a key area for investment. In recent years, venture capital investment in Pakistani startups has gained traction, with over $350 million raised in 2021 alone, marking a shift toward technology-driven economic activity.[3]

Despite these promising developments, Pakistan has struggled to fully leverage its investment potential due to a lack of economic branding. Unlike regional competitors, the country has not effectively marketed its economic strengths—such as a young, globally competitive workforce and strategic trade access to East Asia, South East Europe, and the Middle East. Instead, geopolitical narratives of instability have overshadowed the real opportunities available, especially for its growing entrepreneurial ecosystem.

The line graph above illustrates Pakistan’s FDI inflows from 2010 to 2023.

Current Economic Indicators:

GDP Growth: the Pakistani economy is projected to grow at 2.5% in FY2025, with improvements expected in the services and agriculture sectors.[4]

Inflation stood at 23.41% in FY2024 as compared to the previous year but is expected to improve as fiscal measures take effect, such as tax reforms, subsidy rationalization, and investment-friendly policies. The government has introduced tax incentives for businesses, including reduced corporate tax rates and exemptions for Special Economic Zones (SEZs), to attract investment. Additionally, energy sector subsidies for industries, along with export rebates and duty drawbacks, aim to boost economic activity. Public spending on infrastructure projects under the Public Sector Development Program (PSDP) and CPEC initiatives is also expected to stimulate growth. Furthermore, fiscal consolidation measures, including IMF-backed policy adjustments and debt management strategies, are likely to enhance macroeconomic stability and investor confidence.

Currency Stability: The Pakistani Rupee has stabilized recently following an IMF bailout and improved remittance inflows, with an increase of 24% in foreign exchange reserves as compared to the previous year. This improvement is driven by higher worker remittances, a narrowing current account deficit, and stringent fiscal measures aimed at stabilizing the economy.

Key Industries of Opportunity:

1. Tech Startups

Pakistan’s tech startup ecosystem has seen unprecedented growth in recent years, driven by a young, digitally literate population and increasing investor interest. In 2022, Pakistani startups raised over $350 million in funding despite global economic slowdowns, showcasing the resilience and potential of the sector.

Pakistan’s freelancing sector is a key driver of the tech economy, contributing over $1 billion annually. In FY24 (July 2023 – March 2024), freelancers generated $350.15 million in foreign exchange earnings. The average monthly income ranges from PKR 40,058 to PKR 62,498, depending on skills and experience. With a 27% increase in earnings in recent years, Pakistan ranks among the fastest-growing freelancing markets globally, strengthening its position in the digital economy.[5]

This rapid digital transformation is not only evident in the rise of individual freelancers but also in the growth of tech-driven startups that are reshaping the local ecosystem. Notable examples include:

Airlift:

Airlift was a Lahore-based startup that initially launched as a mass transit service, offering affordable, app-based bus rides. During the pandemic, it pivoted to quick commerce, delivering groceries and essentials within 30 minutes. In 2021, it made headlines by securing $85 million in Series B funding, the largest single private investment in Pakistan’s startup history.

However, despite its rapid rise, Airlift shut down in 2022 due to a series of financial and operational challenges:

Over-Reliance on External Funding – Airlift’s aggressive expansion into quick-commerce required heavy subsidies and high burn rates, making it dependent on continuous funding rounds. When the global funding climate tightened, it struggled to secure capital.

Economic Downturn & Inflation – Rising inflation and a depreciating rupee increased operational costs, while reduced consumer spending hurt revenues.

Expansion Beyond Market Capacity – The company expanded operations into South Africa, stretching resources too thin instead of consolidating its home market.

Unit Economics & Profitability Issues – High logistics costs and discounts meant negative margins per order, making the business unsustainable in the long run.

Investor Hesitation – The 2022 global tech downturn made venture capitalists more cautious, and Airlift failed to secure its next funding round, forcing a shutdown.

Airlift’s downfall serves as a cautionary tale for Pakistani startups. It underscores the importance of profitability over rapid scaling, adapting to economic realities, and ensuring financial self-sufficiency rather than relying solely on venture capital.

Bykea:

Bykea is a Karachi-based startup that provides bike-based ride-hailing, delivery, and payment services through its mobile app. Launched in 2016, it caters to Pakistan’s middle and lower-income segments, offering affordable transportation, parcel delivery, and cash-based financial transactions. Bykea managed to secure $10 million in funding in 2022 to expand its mobility and logistics services.

With internet penetration exceeding 36% and a growing e-commerce market (valued at $4 billion in 2022), the tech sector continues to attract significant domestic and international investment.

2. Agriculture

Agriculture remains a cornerstone of Pakistan’s economy, contributing 23% to GDP and employing 38.5% of the labour force. Modernization efforts, such as precision agriculture and smart irrigation systems, are improving productivity.[6]

Key Crops & Exports: Pakistan is the 4th largest producer of cotton and a leading exporter of rice. Additionally, sugarcane is a major crop, supporting the large domestic sugar industry, though challenges like inefficiencies and price volatility persist.

Agriculture Transformation Plan: This government initiative promotes mechanization, digital farming, and subsidies to boost crop yields. Agri-tech startups like Tazah are also leveraging technology to streamline supply chains and reduce waste.

Halal Meat Potential: With a large livestock population, Pakistan has significant untapped potential in halal meat exports. While the country exports to the Middle East and Southeast Asia, it has yet to fully capitalize on the $2 trillion global halal food market. Investments in modern slaughterhouses, cold chain logistics, and quality certifications could help Pakistan establish itself as a major supplier to Europe, Central Asia, and Africa, where demand for halal-certified meat is rising.

3. Textiles

The textile industry is a cornerstone of Pakistan’s export economy, accounting for over 60% of total exports, valued at approximately $19 billion in FY2023. Leading textile firms such as Style Textile ($522 million), Interloop Ltd. ($423 million), Nishat Mills Ltd. ($381 million), Artistic Milliners ($330 million), and Gul Ahmed Textiles ($302 million) have played a crucial role in driving this growth. Pakistani manufacturers supply products to major global brands, including Zara, H&M, C&A, Bestseller, Adidas, Next, Mango, and Forever 21. Government incentives such as duty drawbacks, subsidized utility rates, and export refinancing have strengthened the sector, while the EU’s GSP+ trade incentive has further boosted demand. The rise of sustainable fashion and organic cotton trends also presents new investment opportunities. With a strong infrastructure and increasing global demand, Pakistan remains a key player in the international textile market.

4. Clean Tech

With rising energy demand and environmental concerns, Pakistan is focusing on clean tech as a critical sector for investment. The country boasts an estimated potential of 50,000 MW from wind energy and 2.9 million MW from solar energy. Key initiatives include:

• The Jhimpir Wind Corridor, where over 1,000 MW of energy is being generated from wind projects.
• The Quaid-e-Azam Solar Park, with a capacity of 1,000 MW, is one of the largest solar projects in the region.
• The Alternate and Renewable Energy Policy 2019 aims to generate 30% of electricity from renewable sources by 2030.
• International investors, including China and the UAE, are actively participating in clean tech projects, signaling the sector’s potential for high returns and sustainable growth.
• Pakistan’s electric vehicle (EV) sector is experiencing significant growth, driven by both local initiatives and international collaborations. Chinese manufacturers like Changan and BYD have announced plans to introduce EVs into the Pakistani market. Notably, BYD is partnering with Hub Power’s subsidiary, Mega Motor, to establish Pakistan’s first EV assembly plant by 2026, aiming to position the country as a key automotive export hub targeting regions such as Africa and South Asia.

In support of this evolving landscape, Lahore University of Management Sciences (LUMS) has inaugurated an E-Mobility Research and Development Center. This center focuses on advancing EV technologies to address environmental challenges like air pollution and climate change, aligning with national goals for EV adoption by 2030.

LUMS also  hosted the 2nd Symposium on Battery Electric Vehicles (BEVs) in collaboration with HEC Pakistan, the World Bank, and IFC, focusing on ‘Accelerating the Electric Mobility Transition in Pakistan.’ The event brought together policymakers, academics, and industry leaders to discuss progress, challenges, and strategies for advancing EV adoption in line with global trends.

• Rawana, a startup in the Idea Launch cohort at LUMS Center for Entrepreneurship (LCE), is revolutionizing last-mile delivery with electric vehicles, promoting sustainable urban transportation through efficient and eco-friendly mobility solutions.
• Voltshare Technologies, part of the Slingshot Accelerator cohort at LUMS Center for Entrepreneurship (LCE), is connecting EV drivers to real-time charging stations, reducing range anxiety and supporting Pakistan’s growing electric mobility ecosystem.

Government Initiatives:

The Pakistani government has implemented several strategic measures to attract investment and improve the business climate:

Tax Reforms & Incentives: The government has introduced tax amnesty schemes, reduced corporate tax rates for IT exports, and exemptions for startups to encourage business formalization and attract FDI. In the latest budget, IT and freelancing sectors were granted tax exemptions and incentives to boost Pakistan’s digital economy.

Special Economic Zones (SEZs) under CPEC: Pakistan has established nine SEZs, including Rashakai, Allama Iqbal, and Dhabeji SEZs, aimed at attracting both local and foreign investors by offering tax holidays, duty-free imports on machinery, and infrastructure support. These SEZs are positioned to boost manufacturing, particularly in automobile, textile, and pharmaceuticals. However, bureaucratic delays and inconsistent policies have slowed their full potential.

Ease of Doing Business Reforms: Pakistan improved its ranking in the World Bank’s Ease of Doing Business Index from 136th in 2018 to 108th in 2020 before the rankings were discontinued.[7] Key reforms included simplifying business registration through the SECP, introducing online tax filing systems, and reducing approval times for construction permits and electricity connections. However, challenges remain in contract enforcement and dispute resolution, deterring long-term foreign investment.

While these initiatives signal progress, policy inconsistency, political uncertainty, and economic volatility remain key challenges in fully leveraging these reforms to attract sustainable investment.

Regional and International Investment Trends:

Pakistan’s strategic location provides access to South Asia, Central Asia, and the Middle East, making it a potential investment hub. Recent trends show growing FDI in technology, renewable energy, and infrastructure, particularly through CPEC-driven SEZs and fintech expansion. However, macroeconomic challenges and policy uncertainty continue to impact investor confidence.

Globally, investment trends are shifting toward sustainable development, digital transformation, and AI-driven innovation. Countries are prioritizing green energy, supply chain diversification, and smart manufacturing to mitigate economic volatility. Pakistan must align with these global trends to attract long-term, high-value investments.

Key Challenges:

Economic Instability: Persistent fiscal deficits, external debt obligations, and currency fluctuations create economic uncertainty, impacting investor confidence.

Political and Security Concerns: While political transitions and regional tensions have historically posed challenges, improving security metrics offer hope for a more stable business environment.

Regulatory Framework: Complex bureaucratic processes, unclear tax policies, and inconsistent regulations remain major hurdles for local and foreign investors.

Expert Opinions:

To understand the evolving investment landscape in Pakistan, we gathered expert insights on investor priorities, market opportunities, and key factors that drive funding decisions.

Hammad Umer, an experienced investment manager and head at Inistor, highlighted the evolving priorities in the investment space: “Investors are now more conscious of valuations and selective in their investments. Governance practices play a crucial role in building trust and attracting funding.” He advised entrepreneurs to collaborate, explore new opportunities, and adopt a strategic vision for long-term growth.

He also underscored the potential of cleantech, stating, “Sectors like mobility and alternative fuels hold significant promise, though they remain underdeveloped. However, with the government introducing favorable energy policies, there is a strong opportunity for innovation and growth in these industries.”

With nearly three decades of experience in software development and technology services, Dr. Salman Iqbal, founder of Denovonet, pointed to IoT innovations in healthcare as a promising investment area. He shared that his company developed a smart diaper that alerts caregivers via text message when it needs changing. His advice to startups: “Focus on the problem you want to solve and assess its long-term monetization potential.”

He also emphasized the transformative potential of emerging technologies, stating, “The next major shift will be in generative AI. As more innovators explore its applications, it will become a powerful tool for problem-solving and delivering value to customers. Prompt-based AI, in particular, offers new opportunities to enhance efficiency and improve everyday experiences.”

Success Stories and Investment Trends

International Firms: Companies like Coca-Cola have made billion-dollar investments in Pakistan, showcasing confidence in its consumer market.

Local Startups: Success stories like Bykea and Careem illustrate how tech-driven innovation can thrive despite economic challenges.

Renewable Energy Projects: The Jhimpir Wind Corridor and other initiatives have attracted international partnerships, underscoring clean energy’s potential.

What Investors Look For:

• Scalability: Startups in e-commerce, fintech, and healthcare that leverage technology for rapid growth are particularly attractive.
• Market Size: With a population exceeding 240 million, Pakistan offers a vast consumer base, especially in urban centers.
• Growth Potential: High-growth industries like clean energy, agri-tech, and digital financial services align with both local needs and global investment trends.

Actionable Advice for Investors:

Form Strategic Partnerships: Collaborating with local businesses helps investors navigate regulatory challenges and gain market insights.

Understand the Business Culture: Personal relationships and trust play a crucial role in securing long-term business success in Pakistan.

Leverage Government Incentives: SEZs offer tax benefits and simplified regulations, particularly for manufacturing and tech sectors.

Plan for Market Challenges: Investors should prepare for currency fluctuations and bureaucratic hurdles with diversified portfolios and localized risk assessments.

Startup Lessons:

The investment climate in Pakistan is evolving, creating new opportunities for startups. However, many entrepreneurs struggle with raising capital, navigating regulations, and achieving long-term growth.

Muhammad Umer Hassan and Talha Dar, founders of Markhor 3D, a STEM-focused hardware startup, shared their experiences:

• Many investors favored quick-return software startups over hardware ventures.
• Political instability and foreign policy challenges deterred international investors, including one from China.
• Despite multiple rejections, they shifted focus to self-funding, revenue generation, and strategic partnerships.
• Their persistence paid off when angel investor Bilal Ahmed came on board, emphasizing the importance of finding the right supporters.

Key Takeaways for Startups:

• Understand Investor Expectations: Demonstrate scalability, profitability, and clear business models to attract funding.
• Utilize Funding Effectively: Investments should be allocated to product development, market expansion, and operational efficiency.
• Leverage Local Ecosystems: Engage with incubators like LUMS Center for Entrepreneurship (LCE), for mentorship and funding opportunities.
• Adapt to Funding Challenges: With global funding markets tightening, startups must explore local venture capital, crowdfunding, and alternative revenue streams.
• Stay Resilient: Persistence, adaptability, and a strong vision are crucial for long-term success.

Pakistan’s startup ecosystem is at a pivotal moment, with increasing venture capital inflows, digital transformation, and government initiatives fueling growth. However, strategic navigation, strong governance, and adaptability are essential to overcoming investment challenges. For investors and entrepreneurs alike, Pakistan presents both risks and immense opportunities, making it a market worth watching.

8. Conclusion

Pakistan’s investment climate is evolving, driven by a combination of strategic reforms and emerging opportunities. The government has introduced investor-friendly policies, including tax incentives, simplified regulatory frameworks, and the development of Special Economic Zones (SEZs) under the China-Pakistan Economic Corridor (CPEC), which offer duty exemptions and infrastructure support. Efforts to stabilize the economy through fiscal consolidation and improving ease of doing business rankings have further enhanced investor confidence. Moreover, the growing focus on sectors like renewable energy, technology, and value-added agriculture reflects a shift towards modernization. With a young, tech-savvy population, increasing urbanization, and a rising middle class, Pakistan is positioning itself as a dynamic regional hub for trade and investment.

[1] State Bank of Pakistan, Summary of Foreign Investment in Pakistan, 2024, https://www.sbp.org.pk/NetinflowSummary

[2] Dawn, November 19, 2024. https://www.dawn.com/news/1873377.

[3] Ministry of Information Technology & Telecommunication. Yearbook 2021–22. Government of Pakistan. Accessed May 19, 2025. https://www.moitt.gov.pk/SiteImage/Downloads/MoITT-YB-21-22.pdf.

[4] Asian Development Bank. “ADB Forecasts Pakistan’s Economy to Grow 2.5% in FY2025, as Reforms Take Effect.” News release, April 9, 2025. https://www.adb.org/news/adb-forecasts-pakistan-economy-grow-2-5-fy2025-reforms-take-effect.

[5] Mettis Global. “Freelancers’ Remittances Reach $350.2m in July–March FY2024: Survey.” Mettis Global News, June 12, 2024. https://mettisglobal.news/freelancers-remittances-reach-350-2m-in-july-march-fy2024-survey/.

[6] Finance Division, Government of Pakistan. Pakistan Economic Survey 2023–24: Chapter 2 – Agriculture. https://www.finance.gov.pk/survey/chapter_24/2_agriculture.pdf

[7] State Bank of Pakistan. “Ease of Doing Business (EODB) Index.” https://www.sbp.org.pk/FS/Ease/Ease-r.html

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