Business in Pakistan is poetry scribbled in ledgers, dreams stitched into cloth for export. A tailoring unit in Multan prays for Paris. A poultry processor in Karachi whispers Dubai. A woman in Gilgit selling eggs hopes her name will travel beyond the mountains. Export is our national obsession, the badge declaring we exist in the world. But behind it lies another hunger: to be corporate, to become institutions that outlast their founders. Export is the chase, corporate the crown. Yet here, both often dissolve into smoke.
Pakistan’s 5.2 million SMEs make up ninety percent of businesses, employ eighty percent of the non-farm workforce, contribute forty percent of GDP, and a quarter of exports. Yet they survive on starvation capital, barely seven percent of private credit, down from a decade ago. Compare this with Bangladesh, where SMEs claim twenty-five percent of credit, or Vietnam, which leapt from twelve to thirty-one percent in just eight years. In Pakistan, it is easier to drown in potential than to rise on it.
Finance is the first betrayal. Most SMEs survive on family savings while banks demand collateral worth 150% of a loan, versus 80% regionally. Microfinance, sold as salvation, traps them at 24% interest, wheels that turn endlessly, never taking flight. Bangladesh broke free: concessional 6% loans lifted its textile SMEs from $8 billion to $35 billion in exports within a decade. Kenya’s M-Pesa gave 700,000 SMEs access to credit in just five years. Vietnam built industrial clusters where small firms share infrastructure and compete globally.
In Pakistan, venture capital barely scratches $50 million a year, compared to Bangladesh’s $200 million. Government “schemes” are half-baked: Rs. 6 billion spread over three years for just 6,000 enterprises, drops for millions who thirst. Incubators mushroom across cities, but many charge Rs. 15,000 a month for a desk, serving coffee instead of capital.
Taxation punishes growth. SMEs face effective rates of 31% while corporate giants enjoy 25%, on top of Rs. 50,000 a month in compliance costs. Crossing Rs. 10 million in revenue triggers a tax cliff from 1% to 29%, encouraging permanent smallness. Registration takes sixteen days and eight different offices, while Rwanda does it in one day, one window.
And when an SME does succeed, survival means surrender. Milkpak became Nestlé, and Engro Foods dissolved into FrieslandCampina. In seventy-five years, Pakistan has birthed barely two multinationals while South Korea has produced dozens. Our success stories are not scaled; they are swallowed.
Some argue that SMEs in the developing world lack the systems to compete globally. Yet Vietnam’s once-informal textile sector proved how targeted upgrading can transform fragility into competitiveness. Portfolio theory itself shows that thousands of diverse SME loans reduce systemic risk, unlike our current model of betting everything on a few corporate giants. The 2008 crisis reminded us of that folly.
Still, the hunger persists. Graduates in Karachi, engineers in Lahore, craftsmen in Multan, women selling eggs in Gilgit, all dream of export and corporate glory, refusing the fate of “small forever.”
The answers are not abstract. A graduated corporate tax, starting at 10% for firms under Rs. 50 million, scaling to 25% above Rs. 500 million, would remove growth-killing cliffs. Mandating that banks raise SME lending to 25% within five years, backed by government guarantees, would fuel expansion. An SME Export Fund at 8% interest, instead of today’s 14%, would turn ambition into shipments. Real incubators must offer equity, mentorship, and global connections, not just Wi-Fi and coffee.
The World Bank estimates Pakistani SMEs could generate $45–65 billion in additional exports within five years, halving our trade deficit. In Malaysia, SMEs contribute 68% of manufacturing exports, compared to Pakistan, where, despite being 90% of all enterprises, they manage just 25%. The gap is not capacity, it is design.
October’s budget should set aside Rs. 500 billion for SME credit guarantees. Business registration must go fully digital. Export finance should be democratised, not monopolised by textile barons.
Because business here has never been just money, it is the hunger to exist beyond yourself. To stand beside giants as equals, not as acquisitions. That dream does not die; it circles our bazaars like a restless bird, waiting for the sky we might yet choose to unlock.
