Pakistan’s flourishing e-commerce industry
Pakistan’s e-commerce industry is flourishing expeditiously as more and more people are using internet, smart phones as well as social networking sites.
There are several other factors that have encouraged electronic-commerce in Pakistan. “Expatriates” are the masses who dwell outside the state. They are the people who sometimes also encourage e-commerce as they offer a marketplace for entrepreneurs.
People in developing nations like Pakistan have now recognized the social and economic benefits that could result from of e-commerce. They can rapidly arrive in the market and obtain every information that they want. From a pair of shoes to the best computer accessories, financial services, airfare deals, consumer can get anything easily delivered in minutes.
It has also reduced transaction cost. Contemporaneously, it provides entrepreneurs an easy entree to the world market at lower cost. As a matter of fact, information and the pace of information give a vigorous push to this industry.
Pakistan has now been considered one of the fastest growing e-commerce markets in the globe as this industry has been estimated to be worth US$600 million by 2017.
Moreover, it has been forecast that the internet enabled population is anticipated to increase to 56 million till 2019 and the industry has been forecasted to suffer up to several hundred million dollars till 2020.
This industry has prodigious potential to grow and local producers have shown laudable ability to shaping the economy through electronic commerce but still there’s a long way to go.
There are plenty of people who don’t have basic knowledge and understanding of e-market. Lack of education and technical proficiency is the basic impediment against the growth of this industry. Since, cashless society is a far-off goal, people are not trained enough to make digital payments. Moreover, people do not let their fingers do the walking instead they prefer to go take a look at the marketplace.
Encouraging computer literacy is all-important in order to get this industry up to snuff. There is an immense need to build up public sector IT universities all over the country.
One of the eminent barriers is non availability of funds in acquiring IT skills and the issue which has already been addressed many times before is lack of research which is a key factor due to which we are falling behind even some developing nations of the world.
Moreover, electricity shortfall as well as shortage of capable trainers is stumbling block in success of this industry.
Foreign competitors are penetrating the domestic market due to which the survival of local companies is at stake because local producers are unable to compete with efficient foreign competitors equipped with modern technology, highly skilled workforce, better management team, and even their product quality is comparatively superior. Since more people are going in for online trading, competition will further intensify as more and more foreign producers are expressing interest in domestic e-commerce industry.
Protectionism is a choice to sustain its growth but the other side of the coin is complacency, carelessness and inefficiency. In the long run, protectionism could weaken the industry because producers may not find an imperative need to innovate and maximize their specialization level. Protectionism may also have a retaliatory reaction from other states.
There is a lot of work needs to be done. All economic activities of this industry must be well documented in order to meet the regulatory criteria to maintain the standard of this industry. Government should also facilitate innovative minds.
E-government applications have already built in different projects but one of the barriers is insufficient awareness of its effective use.
Government should launch a campaign through online and offline channels to encourage people to use online services offered by the government but leading the way towards development must be their priority.