Moreover ICT-fund should either remove the condition of owning intellectual-property (because they don’t create any) or mention a percentage of revenues that a future successful company has to be give back to ICT-fund (venture capital model).

My Advice: Dont make engineer or scientist run an ORGANIZATION. I am engineer myself and I know there is no guarantee a PHD or engineer has common sense.

In essence, what he’s saying — and what many other implicitly believe — is that information and communication technology sector is unlike other technology industries, in that it can exist without a strong and broad industrial economy at its base. In fact, the argument goes, it can not just exist but prosper and propel economic growth in the broader economy. Put another way, the argument goes that not only can the ICT sector exist without, say, a manufacturing industry, but it can in fact raise the standards of living in the country which in turn lifts the profitability of the ICT (and other) sector(s).

On the surface, this makes sense. So long as you have a computer (or a smart phone or some device with processing capability), electrical power to run it, and a internet connection to communicate with the rest of the world, you are a first-class citizen of the information age, at par with anyone in the industrialized world. And, if you are at par with everyone else, you should be able to do what everyone else is doing with ICT — i.e., innovation and wealth creation.

I accept the argument, but only in its narrowest sense. It seems to me that the information technology sector can be, more or less, a self-sustaining sector in the economy, generating a small number of well-paying jobs and enough revenue to sustain an efficient & profitable ICT sector. At its limits, this sector can also support small ICT-specific R&D which, in-turn, can lead to incremental improvements in the profitability of the sector itself.

This is where I depart from conventional wisdom. I find it very difficult to accept the vision of a sound “knowledge-base economy” built on the backs of this one sector.

First, it is important to distinguish between the fruits of innovation and innovation itself. Existence of 70 million cell phone users is no more a sign of Pakistan’s technological advancement in the information technology, than the arrival of dish antennas in the 90s was of Pakistan’s advancement in space technology. So, we should not let “arrival” of a technology fool us into believing that we have “advanced” to that technology.

Second, the information technology sector in itelf does not provide a large number of well-paying jobs, unlike the manufacturing sector that does provide exactly that. Google, for example, employs around 20,000 people worldwide, whereas Toyota Motors has almost 16 times more employees. Of course, that’s just a comparison between two companies but it illustrates that point that while the IT sector can provide a small number of very ‘high quality’ jobs, it cannot create the kind of mass employment that is required for true economic growth in a large country such as ours.

Third, without a broad industrial economy, the value-addition that R&D in the information technology that can be done is only of incremental value. Major technological break-through require a larger eco-system than one that can be envisioned solely on the backs of the cell phone carriers. An example would be that a vibrant IT industry in Pakistan can produce a few ‘hit’ companies that sell aps for iPhone, but cannot come up with the the next iPhone, let alone the next wireless communication standard.

In conclusion, I would say that the idea that innovation-centric R&D can both be the chicken and the egg of sound economic development in Pakistan needs greater scrutiny. I think the focus that Dr. Sheikh is bringing to the Fund (captured by the discussion on the thematic areas that the Fund is focusing on) is admirable. But, given the scarcity of resources and the challenge of finding & retaining qualified man-power, it is important to have a serious and sustained debate on our overall IT priorities and, more broadly, our higher education priorities in Pakistan. This debate can be informed by the focus that the Fund is showing, but it should also be realistic in its appriciation of the necessary ingredients of a knowledge-based economy.

Finally, I believe disclaimer is in the order. I make no claim to be an expert on the subject, but I am raising these issues only in the hopes that people with better insights will lead a focused debate on how we should align our priorities in the face of a changing world.