Unemployment ratio is quite high in Pakistan. People especially the youth were expecting some good change when Nawaz Sharif government took over the charge last year. The PM, known as a business friendly personality, realised the grim affairs of the country and the problems of Pakistani youth. He initiated a scheme for the youth Prime Minister's Youth Business Loan (PMYBL) to harness their talent in positive direction. The PM handed over the responsibility of dispersing this loan to his daughter Maryam Nawaz, who is now heading this programme. As the programme started and applications were asked from the interested candidates, some people expressed different concerns about the success of this programme while quoting the plight of similar schemes in the past where such loans did not reach to the deserving.

Dr Muhammad Azam Roomi also showed some concerns about its success if certain essential measures are not taken. He expressed these concerns in an exclusive interview with Sunday Plus. Before having any assumption about him, let me brief that Dr Azam Roomi is not an ordinary person who is expressing his concerns for some political reasons. His profile is very long but briefly he is a very learned man in the field of entrepreneurship and enterprise. He has worked with eight different governments of the world as an advisor of entrepreneurship and enterprise development including government of Qatar, Government of Oman, Poland, Germany and the UK. Besides, he had served in more than forty countries as a consultant, trainer and teacher as well. Presently, he is performing his duties as a Director Research, Centre for Women's Enterprise at the University of Bedfordshire, London.  He is also principal lecturer in entrepreneurship.

These days Dr Azam Roomi is in Pakistan and spending his holidays with his mother. Appreciating PMYBL, he said that he had looked into the minute details and said it was a very good initiative in the absence of venture capital funding culture and collateral free loans. “It is not possible for people at small business level and especially youth that they own a property and they cannot provide collateral. So definitely they need loans and this scheme is not only in our country but there are other countries in the world including the developed ones where governments provide that kind of funding opportunities. But there is a difference between those countries and our country in dispersing these loans.”

“They provide funding to people including youth after looking at their business ideas and their potential for the business. They also look at the capabilities of those particular persons that whether they can run it or not. Unfortunately this is missing in this project. Anybody who can just download one of the 56 feasibilities from the SMEDA’s site can apply for the loan. There is not criterion to see whether that person has that capability of proper utilisation of that loan or not. So resultantly, anybody who has some political backing or any influential person applies will get the loan but people who deserve it may go at the back of the line,” he continued.

Further elaborating his point of view he said, “Eligibility of applying for this loan is not based on the idea, it is based on feasibility available on SMEDA’s website. Ideally, this should happen that people should come up with their business ideas and if those ideas are innovative, creative and unique, they should get that loan because only an innovative and creative business idea is considered to be a key for the success and exponential performance of any potential business.”

“It is to understand that because is not a static thing to do, it is very dynamic reality which changes very quickly. So to run any business properly one should have certain capabilities, abilities and characteristic. And if one does not have these qualities then loss is imminent. Globally, majority of businesses fail in the first three years of their existence. One of the most cited reasons is improper planning,” he continued.

Telling the fate of the loan dispersed without considering the above mentioned points, he said, “If you offer a hefty sum of money to an inexperienced, incompetent, and incapable individual who cannot even generate their own idea for starting up a new business then it is like giving one’s child a razor sharp knife to play with or presenting the key of an automobile to a teenager who does not know how to drive it. In both the cases, the loss is imminent and inevitable.”

“So in this case if we give a very optimistic figure then 10 percent money will come back. That means if the government disperses Rs. 100 billions then Rs. 10 billions will be returned. In order to minimise the failure rate, the money should be given only to those people who go through a training programme as other governments of the world do. Those governments not only give training to new entrepreneurs but also provide them mentors,” he elaborated.

When asked that how the risk could be minimised and what are the measures which other governments of the world do, he said, “It is a three tier approach; first people should come with their own business idea, they should be given the training of that business before handing over the loan to them and finally to provide them mentor so that they would be helped out when it is required.”

He also proposed one more option to make this programme successful and that is the government select one man and one woman from each district of Pakistan, train them by a master trainer. He pointed out that if the government wants to save half of the money which they are going to disperse, they should train at least 200 trainers all over Pakistan using latest pedagogies available, emphasising upon learning for ‘Enterprise development and Entrepreneurship’. These trainings should emphasise on creativity, innovation, idea generation and opportunity recognition.

When he was shared the doubts of some people who see some political vested interest in such schemes he rejected all such doubts and briefed with an example. “There are big stores everywhere in the world and during shopping people steal many items. As a businessman what the owners can do is to minimise that stealing ratio but they cannot stop it absolutely. It is because people always come up with different methods and techniques. Same is true with benefit systems and such programmes because it is in human nature. So this is not exception in Pakistan. Here people will also try to escape from returning the loan or will mismanage the money. What the government’s job is to minimise that risk because it cannot be eliminated. Even banks do that. Some people are complaining about the harsh conditions. But I think it is good and conditions should be harsh,” he briefed.

Dr Azam Roomi appreciated this programme but he emphasised that the government should give this loan to deserving persons because in that case chances are higher the loan would be returned.