Why Pakistan needs dollars, not remittances

A fourth visit, and a feedback loop worth documenting

The episode opens with Muzamil welcoming Laeeq Ahmed back for what is, by both their counts, his fourth appearance on Thought Behind Things. The tone is immediately different from a standard guest interview. Laeeq does not arrive to pitch a product. He arrives to close a loop — to report back on what happened after the previous conversations aired.

“Last time was a very sort of a different experience for me,” Laeeq says. He describes his first appearance, on episode sixty, as a moment of genuine confusion: he had an idea, he was trying to reach investors through LinkedIn without much success, and he was not sure whether anyone was listening. What followed surprised him. After the third episode, investors began reaching out directly. He had recently come from a meeting with one of them the week before recording this conversation.

The feedback that matters most to him, though, is not from investors. It is from students. Laeeq describes sitting in on onboarding sessions for Sarmaaya’s training programmes and asking participants where they heard about the platform. The answer, repeatedly, was TBT. He points to Trustpilot reviews as independent verification: “I think 80% of the people or 70% of the people are coming from TBT and they basically acknowledge that this particular [conversation] changed their life.”

Muzamil receives this graciously but redirects quickly. The real subject of the episode is not the platform’s growth. It is the economy.

The dollarized portfolio as a survival strategy

Pakistan’s rupee had, by the time of this recording, fallen sharply — from around 160 to over 270 to the dollar. Muzamil asks Laeeq directly: how is he managing his own portfolio in this environment?

Laeeq’s answer is structured around a single principle: dollarization, but not in the way most people mean it. He is not talking about buying and holding foreign currency. He is talking about owning equity in companies whose revenues are denominated in dollars.

“My 60% exposure is in IT companies,” he explains. “If an IT company’s revenue is stagnant, no growth at all, they still get that dollar revenue — and because of that, their value is protected. Even if devaluation hits 350, that value is protected.”

He uses Systems Limited as his primary example. The company had revenue of 3.8 billion rupees in 2018. By 2022 that figure had reached 15 to 16 billion rupees — not because the business fundamentally changed, but because the dollar rate moved. With the rupee at 270 and climbing, he projects the company could reach 17 to 20 billion rupees in revenue within a single quarter. The profit margin sits at roughly 30 percent. His conclusion: holding IT-sector equities is a structural hedge against currency devaluation, available to any investor through the stock exchange.

He contrasts this with textile companies, which look like export earners on the surface but carry significant import exposure — raw cotton, gas, machinery — all of which inflate in rupee terms as the currency weakens. When US inflation rises and American consumers cut spending, textile demand falls. When US companies face cost pressure, they look for cheaper IT talent. Pakistan benefits from the same macro shock in opposite directions depending on which sector you hold.

Why real estate is not the answer right now

Muzamil raises real estate — the default investment for most Pakistanis with savings — and Laeeq does not dismiss it entirely, but he is precise about what is wrong with it at this moment.

He tells a personal story. He sold his family home in Muzaffarabad in 2008 for 4.5 million rupees and moved to Islamabad. He bought a plot in G-13. The plot’s value fell from 1.2 million to under 600,000 rupees during the inflationary period of the PPP government. He held. It eventually recovered. The story is not a cautionary tale about real estate in general — it is a cautionary tale about timing, liquidity, and the hidden costs of undocumented transactions. He describes the actual purchase: a man arriving on a motorcycle in Rawalpindi with cash wrapped in newspaper inside a shopping bag. “That is undocumented economy,” he says flatly.

His structural critique is simpler: “The price of the plots are too high. Demand and supply should determine it.” A plot 40 kilometres outside a city, with no infrastructure, no roads, no services, selling for 7 million rupees — and then the cost of construction on top of that — prices out the ordinary salaried worker entirely. “Can a common person who is doing a job buy real estate in this country? Can he build a house?” The answer, he argues, is no. And if the end buyer cannot afford to build, the land price is not justified by any real demand.

He contrasts this with dividend-paying equities. Engro, he notes, paid a dividend of 34 rupees per share in the year of this recording. Someone who had invested 97,000 rupees in 1,000 Engro shares twenty years earlier would have received total dividends of 12 to 25 lakh rupees by now — a 70 percent annual return in the most recent year alone. “People have made so much hype about the stock market,” he says, but the dividend yields from blue-chip companies are real, documented, and accessible.

The passive income argument is not about wealth — it is about resilience

Later in the discussion, Laeeq makes a point that sits outside the usual investment conversation. He is not talking about getting rich. He is talking about what happens when things go wrong.

He describes the hotels along the Swat River — thirty-room properties earning 80 lakh to a crore rupees per month at peak season. Then the floods came. “The owner lost the land, lost the building, lost everything.” His question: what if, during the good years, that owner had been building a passive income stream in parallel? The earthquake in Turkey, he adds, is the same story at a different scale.

“People don’t work happily,” he observes. “They work because they have to — rent, family, obligations. Someone might have a real passion for photography but cannot pursue it professionally because he is financially burdened.” Passive income, in his framing, is not a luxury product for the already-wealthy. It is the thing that gives a person options when their primary income disappears — whether through a natural disaster, a job loss, or an economic shock.

Pakistan’s IT ceiling: 15 to 20 billion dollars

Muzamil notes that he has spoken to many IT companies on the podcast and consistently hears that the opportunity is large but the talent pipeline is broken. He asks Laeeq to put a number on the opportunity.

“There is no reason why Pakistan cannot earn at least 15 to 20 billion dollars from the global market,” Laeeq says. He points out that Pakistan’s current account deficit, in bad years, runs to roughly that same figure. The implication is direct: a fully realised IT export sector could, in principle, close the gap that is currently driving the rupee into the ground.

He is not describing a distant aspiration. He describes a colleague who, during COVID-era cost-cutting at a multinational, watched all the Western employees get laid off while his Pakistan-based team was retained — because the cost differential was too large to ignore. That colleague went back to management and made the case explicitly: “Why are you hiring people in America when I can give you the same skill set here for a fraction of the cost? I will become the face of the company. I will set up the offshore operation.” The pitch worked.

“We don’t need your remittances,” Laeeq says, addressing Pakistanis abroad directly. “We need business.”

The diaspora as a business pipeline, not a cash transfer

This is one of the sharpest arguments in the conversation. Laeeq observes that Pakistan is currently experiencing what he calls a knowledge drain — not just a brain drain. The people leaving are not fresh graduates. They are professionals with ten to fifteen years of hands-on experience, the exact profiles that Canada, Australia, and other immigration systems score highest. “You think about an economy where 40% of your income is taxed immediately,” he says. “And you go there happy.”

His proposal is not to stop people from leaving. It is to change what leaving means. India, he argues, did this by design — sending skilled people abroad and then leveraging those networks to route business back home. Pakistan has the same diaspora but has not built the same infrastructure around it.

“The person going abroad should go and identify what opportunities exist globally, and then empower people here to utilise those opportunities.” The model he envisions is a global delivery centre — Pakistani professionals abroad bring in the client relationships, Pakistani teams at home deliver the work. ABCData, his IT company, is built on exactly this logic.

Training at scale: the Khan Academy classroom flip

The final section of the conversation turns to how you actually produce the 500,000 IT workers Laeeq believes Pakistan needs. His answer draws on what Sarmaaya has already built for financial education.

He describes a CNN segment about Khan Academy’s impact on a US classroom. The teacher had reversed the traditional model: instead of lecturing in class and assigning homework, she sent students home with pre-recorded lectures and used class time for problem-solving. The result was that 70 percent of students arrived already understanding the material. The remaining 30 percent got focused, individual attention. Productivity increased sharply — not by adding resources, but by inverting the sequence.

Sarmaaya runs the same model. Pre-recorded lectures are consumed before the weekend session. The live session is used for questions, assignments, and trade reviews on a demo account. “We already know what questions people ask — there’s a pre-recorded video for that too. 80% of questions are covered before the live session even starts.”

Muzamil asks whether this model can produce world-class IT talent at scale. Laeeq’s answer is unambiguous: “This work is already happening — on Amazon Web Services, on Azure, on Microsoft platforms.” The constraint is not technology. It is instructors. “We don’t need traditional university professors. We need people with practical, hands-on experience who design the content themselves.” Universities, he argues, cannot keep pace with the speed of change in technology — SQL dominated for eight years, then open source arrived, then cloud, then DevOps, then Kubernetes. “People are on their toes. Universities cannot produce the talent the market demands, and they cannot — no matter how you play it.”

By the end of the conversation, Muzamil and Laeeq have sketched a connected argument: protect your savings by owning dollar-linked equities, build passive income before you need it, and understand that Pakistan’s macro problem has a macro solution — but it runs through IT exports and diaspora-routed business, not through remittances or real estate speculation. “We need 500,000 people at least trained in IT, connected to work abroad, earning good income here,” Laeeq says. “That is the economy we need to build.”