Ecosystem for Business Startup in Punjab: Issues, Challenges, and Way Forward

Abstract

The study examined the business startup ecosystem in Punjab, Pakistan to explore the factors responsible for its growth as well as those that obstruct this growth. The key developments that took place in the past two years (2022 – 2024) with respect to, (i) Punjab Government’s initiatives, (ii) key facilitation issues experienced by the relevant organizations, and (iii) regulatory inefficiencies and infrastructure gaps faced by the clients and potential entrepreneurs and startups, were analyzed. Isenberg’s Entrepreneurship Ecosystem Model and Stam’s Entrepreneurial Ecosystem Framework were used to theorize Punjab’s startup ecosystem. The study used a convergent mixed methods research design and used convenience sampling to study four BFCs in Punjab. Survey method using both questionnaire and interviews was employed to gather information from public and private stakeholders in order to understand the startup ecosystem in Punjab. The study found that the business startup ecosystem in Punjab has experienced significant growth over the past two years due to government initiatives such as the BFCs, nevertheless, there were notable challenges that were reducing the potential of such initiatives. The study found that bureaucratic hurdles, regulatory complexities, and limited access to finance continue to delay entrepreneurial success in spite of Punjab’s improvement in global rankings and pro-business policies. The findings from quantitative and qualitative analyses revealed that awareness about BFCs was low, barriers in digital literacy were prominent, and deficiencies in infrastructure impeded the smooth and sustainable functioning of BFCs and other government initiatives. The regulatory overlaps and inconsistent service delivery continued to pose challenges despite efforts by the government to simplify business registration and compliance processes. The study recommends the expansion of BFCs, strengthening of digital integration, awareness and stakeholder engagement, increased monitoring and accountability, regulatory simplification, improved infrastructure, and increasing financial support as viable policy measures to improve the business startup ecosystem in Punjab.