Supporting Private Sector to Keep Critical Civic Space Open in Khyber Pakhtunkhwa Province

Supporting Private Sector to Keep Critical Civic Space Open in Khyber Pakhtunkhwa Province

Partners: National Network of Economic Think–Tank (NNETT)

Locale: Khyber Pakhtunkhwa, Pakistan

Duration of Project: October 2023 - June 2025

BACKGROUND:

SDPI has been collaborating actively since 2014 and has conducted several action research, advocacy, and capacity-building activities around the overarching theme of democratic governance through the private sector’s effective participation in policymaking. On the persistent demand of the private sector, both institutions engaged in a reform agenda under the theme of, “better business regulatory environment.” This included but was not limited to reducing compliance cost of taxes for smaller firms, support to women-led enterprises, tax harmonization, improving the quality of foreign capital, and supporting e-governance through Pakistan Single Window (PSW) in Pakistan.

To ensure sustainability and to develop a mechanism for uptake by local actors, we established and supported the National Network of Economic Think-tanks (NNETT) in 2018 intending to encourage local institutions to take forward reform at a sub-national level. The Khyber Pakhtunkhwa Chapter (KPC) of the NNETT was inaugurated in 2021. The NNETT-KPC has members across the province with partners from governmental institutions, academia, private sector associations, and civil society organizations.

Pakistan’s political climate proved to be a major risk during our program cycle. The evolving security situation in Afghanistan, the recent in-house political instability, and polarization have resulted in an environment where it becomes difficult to engage directly or indirectly with the political stakeholders to create and sustain buy-in. While the team recognizes that the political interventions are important and can impact the business regulatory environment in Pakistan, we believe that under the current circumstances, it is important to engage with select champions of change within the civil service (on the supply side) while continuing to support the nascent efforts of NNETT-KPC members (on the demand side).

While previously NNETT-KPC members were brought together to engage with various economic leads from political parties, this time engagement is envisaged to be more directed towards civil service in key institutions such as the Finance Department, KP Board of Investment & Trade, and Khyber Pakhtunkhwa Revenue Authority.

OBJECTIVE:

Keeping the above in view, the overall goal for the 18-month intervention is to, “promote the long-term implementation of democratic governance principles by empowering change advocates across different segments of NNETT-KPC. This can be achieved through interventions that address both the demand and supply side, facilitating a more practical and effective contribution from NNETT to develop and update regulations, policies, and legislations inclusively.” The goal is further explained below:

Strengthening demand-side interventions through capacity building and supporting identified champions of change in academia, the private sector, and civil society. This includes support in improving communications and public-private dialogue approaches used by various stakeholders.
Enable supply-side interventions by engaging the champions of change within government institutions through idea generation, sandboxing, and capacity-building initiatives.

PROPOSED ACTIVITIES:

For the current project cycle, we will be dividing the Khyber Pakhtunkhwa province into four zones for the project context based on logistic arrangements and the population of NNETT members. The zones include a) Southern Khyber Pakhtunkhwa including Kohat, Bannu, and Dera Ismail Khan Division, b) Central Khyber Pakhtunkhwa including Peshawar and Mardan, c) Malakand Division, and d) Hazara Division.

The activities involved in the achievement of the mentioned overall goal cited above are provided below:

STRENGTHENING OF NNETT:

This activity will involve the development of a structure in the NNETT based on the recommendations of the members. The proposed structure will be multi-layered to enable the presence of NNETT all over Pakistan but focus more on KPC for the coming project cycle. We believe that a strengthened structure is important for the financial sustainability of NNETT and its future operations. Enhancing the capacity of NNETT and NNETT-KPC (SDPI)

DEMAND-SIDE INTERVENTIONS:

Capacity Building of Academic Stakeholders and Entrepreneurship Enablers (including incubation centers)

The members of the academia component of the NNETT-KPC from the four zones will be provided with 2 days capacity building sessions on the following topics:

• Proposal development before federal and provincial budgets
• Proposal development before trade policy formulation
• Grant-making workshop and simulation sessions
• Action research and how to convert academic research into action research.
• Effective stakeholder and community engagement
• Effective dissemination of research findings
• Engaging with policy stakeholders
• Matchmaking with the private sector
• Engagement of the private sector as facilitators in their program
• Awareness of various seed funding initiatives for startups in second-tier cities

Capacity building of the private sector and business associations (with a special focus on women's business associations)

The members of the NNETT from the private sector and relevant associations from the four zones will be provided 2-days capacity building sessions on the following topics:

• Proposal development before federal and provincial budgets
• Proposal development before trade policy formulation
• Policy analysis for various economic policies
• Capacity to research key policy issues affecting their industry. One idea is to match-make these with the local university partners.
• Capacity to effectively communicate policy recommendations to policymakers and other stakeholders.
• Capacity building of civil society representatives of NNETT

The members of the NNETT from the civil society will be provided 2-days capacity building sessions on the following topics:

• Sensitization regarding their role is knowledge brokers.
• Grant-making exercises for non-profit organizations/partners.
• Media orientation on various government initiatives
• Advisory on the various current and prospective projects including sessions on project and program management.

SUPPLY-SIDE INTERVENTIONS:

The supply-side interventions will be conducted with the public sector champions of change. We aim to have different priorities set for this intervention for each year depending on the demand of the government and private sector. A proposal should be simulated for its ancillary impacts involving necessary stakeholders from the Khyber Pakhtunkhwa Revenue Authority (KPRA), Small and Medium Enterprise Development Agency (SMEDA), and Khyber Pakhtunkhwa Board of Investment and Trade (KP-BoIT). This exercise will need the involvement of local trade unions and relevant business associations to provide the aspect from the private sector.

The simulation will be documented in the form of a policy document which may serve as a proposal for the upcoming budget-making exercise. For the next fiscal year, the same exercise can be conducted for one proposal from the private sector. One sandboxing exercise is assumed to take around 9 months. Two sandboxing simulations will be taking place during the project cycle on topics like the one described above.

These activities will result in a series of at least 12 meetings, 10 two-day capacity-building workshops for NNETT and NNETT-KPC members, along with the development of eight policy briefs, eight multi-lingual Op-eds, and three program proposals by members, providing them with practical opportunities to apply the skills they have learned.

Team Members:  Dr Vaqar Ahmed, Engr. Ahad Nazir, and Abdullah Khalid