Pakistan’s Innovation Index: Where Do We Stand?

Innovation is the lifeblood of modern economies, underpinning productivity gains, job creation, and resilience in the face of global challenges. For Pakistan—a country with a vibrant youth demographic and ambitious development goals—strengthening its innovation ecosystem is crucial to accelerate economic growth and improve social welfare.

This in‑depth analysis examines Pakistan’s performance in the Global Innovation Index (GII) 2024, unpacks pillar‑level strengths and weaknesses, benchmarks it against regional and income peers, showcases home‑grown success stories, and outlines a strategic roadmap for elevating Pakistan’s innovation trajectory.

Current Standing on the Global Innovation Index

In the Global Innovation Index 2024, which assesses 133 economies, Pakistan ranks 91st with an overall score of 22.01 out of 100 (Index Simulator). This places Pakistan in the lower half of the ranking, highlighting both progress and persistent gaps.

• Trend Over Recent Years:
  
  • 2024: 91st (22.01) (Index Simulator)
    
  • 2023: 88th (≈23.32) (PIDE)
    
  • 2021: 99th (PIDE)
    
  • 2019: 105th (PIDE)
    
• After peaking at 88th in 2023, Pakistan slipped three places in 2024, signalling short‑term volatility amid a generally slow global innovation finance environment (WIPO, Omni Partnering Initiative).
  
• Over‑Performer Status:
  Pakistan is one of 19 economies worldwide that “over‑perform” relative to their level of development, maintaining this status for the third consecutive year (Omni Partnering Initiative). This suggests Pakistan is converting limited resources into tangible innovation outputs more efficiently than many peers.

Pillar‑Level Analysis: Strengths and Weaknesses

The GII aggregates 80 indicators across seven pillars, split into Innovation Inputs (enablers) and Innovation Outputs (results). Pakistan’s 2024 pillar rankings reveal a pronounced imbalance between inputs and outputs:

Pillar	Rank	Nature	Commentary
Institutions	113th	Input	Weak governance, regulatory hurdles hinder innovation. (Dawn)
Human Capital & Research	117th	Input	Tertiary enrollment low; R&D spending ≈0.3% of GDP. (The News International)
Infrastructure	120th	Input	Broadband penetration ~25%; logistics performance under global average. (The News International)
Market Sophistication	97th	Input	Credit and investment access remain constrained. (Dawn)
Business Sophistication	72nd	Output	Growing private‑sector R&D collaborations; rising trademark filings. (Dawn)
Knowledge & Technology Outputs	69th	Output	Strong performance in patent filings abroad and high‑tech imports. (Dawn)
Creative Outputs	70th	Output	Mobile apps creation and media exports are standout areas. (Dawn)

• Key Strengths (Outputs):
  
  • Knowledge & Technology Outputs (69th): Pakistan generates robust outputs in patents filed abroad, high‑tech imports, and ICT services exports. (Dawn)
    
  • Creative Outputs (70th): Domestic software development, particularly mobile applications, and creative exports are on the rise. (Dawn)
    
  • Business Sophistication (72nd): Private‑sector engagement in R&D partnerships and venture activity is growing, laying the groundwork for ecosystem maturation. (Dawn)
    
• Critical Gaps (Inputs):
  
  • Institutions (113th): Complex business registration, weak intellectual property enforcement, and policy uncertainty deter investors. (Dawn)
    
  • Infrastructure (120th): Limited broadband availability (≈25 percent household penetration) and customs/logistics bottlenecks raise costs for innovators. (The News International)
    
  • Human Capital & Research (117th): With R&D spending at just 0.3 percent of GDP and low tertiary STEM enrollment, Pakistan lacks the depth of skilled researchers needed for breakthrough innovation. (The News International)
    

Regional and Peer Comparisons

Central & Southern Asia

Within the Central and Southern Asia region, Pakistan ranks 5th out of 10 economies, trailing India (39th), Iran (64th), Kazakhstan (78th), and Uzbekistan (83rd), but ahead of Sri Lanka (89th), Kyrgyzstan (99th), Tajikistan (107th), Bangladesh (106th), and Nepal (109th) (eTrade for All).

Lower‑Middle‑Income Group

Among the 37 lower‑middle‑income economies, Pakistan is 14th, sandwiched between Costa Rica (71st) and Panama (72nd) in the global ranking, outperforming peers such as Bangladesh (106th) and Uganda (121st), but lagging behind India (39th), Vietnam (44th), and the Philippines (53rd) (Scribd).

Lessons from Peers

• India (39th): Sustained public–private R&D collaboration, world‑class research institutions, and a thriving startup ecosystem propelled by supportive policy frameworks.
  
• Malaysia (33rd): Targeted tax incentives for corporate R&D and a national commercialization agency have boosted innovation throughput.
  
• Kazakhstan (78th): Prioritization of digital government services and entrepreneurship culture has accelerated institutional improvements.

4. Home‑Grown Innovation Success Stories

Despite systemic challenges, several Pakistani initiatives exemplify home‑grown innovation:

1. Airlift Technologies
   
   • Sector: Urban mobility & logistics
     
   • Highlight: Secured a $15 million Series A in 2024 to scale its on‑demand transit and grocery delivery services, showcasing the potential for tech‑enabled solutions in emerging markets.
     
2. Plan9 Incubator (Punjab IT Board)
   
   • Impact: Since 2012, has supported over 250 startups across fintech, health tech, and e‑commerce, offering seed funding, mentorship, and co‑working space. A notable graduate, Sehat Kahani, now connects 250,000+ patients with doctors via telehealth.
     
3. National University of Sciences & Technology (NUST) CTIC
   
   • Focus: Commercialization of academic research in biotech, IoT, and renewable energy.
     
   • Outcome: 30+ spin‑off companies, including SolarEdge Pakistan, which develops low‑cost solar inverters adapted to local grid conditions.
     
4. State Bank of Pakistan CBDC Pilot
   
   • Undertaking: Pilot testing of a Digital Rupee to enhance financial inclusion and improve tax compliance. The full launch is slated for mid‑2026, potentially expanding formal financial access to 15 million unbanked adults.

Challenges on the Road Ahead

While outputs demonstrate latent potential, several bottlenecks must be addressed for Pakistan to sustain and amplify innovation gains:

• Low R&D Funding: At just 0.3 percent of GDP, Pakistan’s R&D investment trails the 1 percent benchmark common among innovation leaders.
  
• Skills Mismatch: University curricula emphasize rote learning over creativity, critical thinking, and interdisciplinary problem‑solving.
  
• Regulatory Uncertainty: Frequent policy shifts—particularly in taxation and foreign investment rules—erode investor confidence.
  
• Digital & Physical Infrastructure Gaps: Only one‑quarter of households have broadband; poor road networks and border delays inflate logistics costs by up to 25 percent.
  
• Gender & Inclusivity Barriers: Cultural norms and limited access to finance hinder women entrepreneurs, with female participation in tech startups under 10 percent.

A Strategic Roadmap for Enhanced Innovation

To climb the innovation ladder, Pakistan needs a coordinated, multi‑pronged strategy:

1. Elevate R&D Investment
   
   • Target: Increase gross R&D expenditure to at least 1 percent of GDP within five years.
     
   • Actions: Introduce tax credits for corporate R&D; establish a National Innovation Fund with matched public–private contributions.
     
2. Revamp Human Capital & Education
   
   • Curriculum Reform: Embed entrepreneurship, coding bootcamps, and design thinking into secondary and tertiary education.
     
   • Industry Internships: Mandate 6‑month research internships for STEM undergraduates in government labs and private R&D centres.
     
3. Modernize Infrastructure
   
   • Digital Connectivity: Achieve 70 percent broadband coverage through public‑private rollout of 4G/5G networks.
     
   • Logistics Corridors: Prioritize upgrades to the Karachi–Lahore motorway and streamline customs under the CPEC Transport Plan.
     
4. Strengthen Institutions & Governance
   
   • One‑Window Portal: Launch a unified digital platform for business registration, licensing, and IP filings.
     
   • IP & Legal Reform: Ratify the Patent Cooperation Treaty (PCT) fully and establish specialized IP tribunals to enforce rights swiftly.
     
5. Cultivate an Innovation Ecosystem
   
   • Scale Incubators/Accelerators: Expand initiatives like Plan9 into Sindh and Balochistan, with matching grants and mentorship networks.
     
   • Corporate–Startup Partnerships: Incentivize large enterprises to co‑fund accelerator programmes and pilot solutions within their operations.
     
6. Promote Inclusivity & Social Innovation
   
   • Women in Innovation: Launch micro‑grant schemes and mentoring circles specifically for women-led tech ventures.
     
   • Social Entrepreneurship: Leverage the GII’s 2024 theme by integrating impact metrics into public procurement for social enterprises.

Conclusion

Pakistan’s 2024 GII performance underscores a paradox: despite constrained inputs—infrastructure, human capital, and institutional quality—the country consistently “over-performs” in outputs. This resilience offers a foundation upon which to build.

By committing to bold investments in R&D, reforming education, modernizing infrastructure, and streamlining institutional frameworks, Pakistan can convert its latent potential into sustained innovation-led growth. The question is not whether Pakistan can innovate—it is whether its leaders will marshal the political will and resources to unleash the next wave of home‑grown breakthroughs. The time to act is now.

FAQs

Q1. What is the Global Innovation Index (GII) and why does it matter?
The GII is an annual ranking published by the World Intellectual Property Organization (WIPO) that evaluates the innovation performance of 133 economies across 80 indicators, grouped into seven pillars (Institutions; Human Capital & Research; Infrastructure; Market Sophistication; Business Sophistication; Knowledge & Technology Outputs; Creative Outputs). It matters because it provides a data‑driven benchmark for governments, businesses, and educators to identify strengths, diagnose weaknesses, track progress over time, and prioritize policies that foster innovation‑led growth.

Q2. Why has Pakistan’s innovation ranking slipped despite “over‑performing”?
Although Pakistan continues to generate relatively strong outputs (patent filings abroad, software exports, startup formations) given its resource constraints, several input pillars—especially Institutions, Infrastructure, and Human Capital & Research—remain underdeveloped. Regulatory hurdles, low R&D spending (≈0.3 % of GDP), limited broadband access, and a skills mismatch have collectively pulled down the overall score, causing the recent slide from 88th (2023) to 91st (2024).

Q3. How does Pakistan compare with its neighbors and peers?

• India (39th globally): Far ahead, helped by massive public–private R&D partnerships, a vibrant startup ecosystem, and more robust higher‑education research.
  
• Iran (64th) & Kazakhstan (78th): Also outpace Pakistan, backed by stronger institutional reforms and digital infrastructure upgrades.
  
• Sri Lanka (89th) & Bangladesh (106th): Pakistan stands ahead of these South Asian peers, largely due to better business sophistication and creative outputs.

Q4. What are Pakistan’s most promising home‑grown innovations?

• Airlift Technologies: Pioneering on‑demand mass transit and grocery delivery, with a successful $15 M Series A in 2024.
  
• Plan9 Incubator: Has nurtured 250+ startups in fintech, health tech, and beyond—Sehat Kahani telehealth platform being a flagship graduate.
  
• NUST CTIC Spin‑Offs: Over 30 companies in biotech and renewable energy, including locally adapted solar inverter maker SolarEdge Pakistan.
  
• Digital Rupee Pilot: A Central Bank Digital Currency trial aiming for mid‑2026 launch to boost financial inclusion and formalize unbanked segments.

Q5. What are the biggest barriers to innovation in Pakistan?

1. Low R&D Investment: Public and private R&D together account for just ≈0.3 % of GDP (versus ≥1 % in many peers).
   
2. Skills & Education Gaps: Curricula still emphasize rote learning; critical thinking, coding, and research internships are rare.
   
3. Regulatory Complexity: Multiple permits, weak IP enforcement, and shifting tax policies deter both domestic and foreign investors.
   
4. Infrastructure Deficits: Only ~25 % broadband penetration; customs and logistics bottlenecks inflate costs.
   
5. Inclusivity Issues: Women entrepreneurs face cultural constraints and limited access to finance, comprising <10 % of tech founders.

Q6. What immediate actions can policymakers take?

• R&D Tax Credits & Funding: Incentivize corporate R&D and establish a National Innovation Fund.
  
• Educational Reform: Integrate entrepreneurship, design thinking, and mandatory industry internships into STEM programs.
  
• Digital One‑Window Portal: Simplify business registration, licensing, and IP filings through a single online gateway.
  
• Infrastructure Partnerships: Leverage CPEC and private capital to extend broadband to 70 % of households and modernize highways.
  
• Support for Women & Social Innovators: Create dedicated grant schemes, mentoring networks, and procurement set‑asides for inclusive ventures.

Q7. How can entrepreneurs and startups leverage this environment?

• Tap into Incubators: Join programs like Plan9, NUST CTIC, and private accelerators to access seed funding, mentorship, and co‑working space.
  
• Collaborate with Corporates: Propose pilot projects to larger firms seeking digital transformation or efficiency gains.
  
• Apply for Government Grants: Monitor State Bank of Pakistan and provincial IT boards for R&D grants, innovation challenges, and export incentives.
  
• Focus on Export‑Oriented Niches: ICT services, mobile apps, and creative industries (media, games, design) offer relatively low‑barrier gateways to global markets.

Q8. How will the Digital Rupee reshape financial inclusion?
By providing a secure, programmable currency on a mobile wallet platform, the Digital Rupee aims to:

Enhance tax compliance through transparent tracking of digital transactions

Reduce reliance on cash (addressing remittance inefficiencies)

Lower transaction costs for small businesses and gig workers

Bring up to 15 million unbanked adults into the formal financial system