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Economic Growth Sectors of Pakistan
by
Azam Majeed
After 71 years of creation of Pakistan the economic condition at both micro and macro level is not hidden to any one. In this article I will critically analyze different sectors of economic growth which are under debate for last two deceases in Pakistan. Here are some of these sectors.
Traditional claim that Pakistan is an agriculture based economy has fooled many at least for last 20 or so years, and had limited the potential of economic growth and prosperity. The fact of the matter is if the planner did not notice the rapidly changing global and regional scenarios thing we are at the point of no return. When supply of water has been limited in a very systematical way by India and so called Argo-based economy for which the water is basic ingredient because most of agriculture is organic based. On the other hand main source of power is also been cut of because of interrupted supply of water in the rivers by India which is building dams in violation of Indus accord.
Due to unpredictable weather and water supply and poor cultivating methods, the per acre yield is falling every year. The fact is that no country can afford to claim to Argo based in ever changing weather phenomenon like ELNINO and ELNINIO and basic supplies like water.
In northern provinces of Pakistan like Punjab and NWFP, the per ca-pita return are comparatively better than southern provinces of Sindh and Baluchistan because water level at the run of the river is hardly enough and soil properties as not well enough. Adapting to ever decreasing fall in available water the southern provinces should have taken the benefit from the available resources like ports/sea and mineral resources available in Sindh and Baluchistan and promote them Instead of complaining for other provinces of claiming their share of water.
In short provinces should have been directed to specialize in the local conditions than following other which they were not good at. For example if Punjab and NWFP want to be industry based they would face big disadvantage over Sindh and Baluchistan that they do not have port available for exports and imports as ion the case of textile industry in Punjab. On the other had if Sindh and Baluchistan wants their economies to agro based they have disadvantage of water scarcity and land is not very suitable for agriculture as compared to Punjab. So ideally Punjab and NWFP can be more agriculture based and Sindh and Baluchistan industry based. Cotton produced in Punjab and NWFP can be processed in Sindh and Baluchistan and exported through the Ports.
Livestock/Poultry/Sea food
Livestock has done well in last few years. Main driving force behind it was the demand for meat, milk and dairy based products. Most of the livestock and related products are serving only the local market. Pakistan is on top ten milk producing countries of the world. But almost 25-30% of the milk produced is wasted and can not be utilized due to lack of storage and processing facilities. There is need of investment in cold storages where milk can stored or converted into long life dried milk powder. Similar is the case with poultry product. Fore example egg produced is only consumed locally and can not be exported due to its perishable nature.
The second produce of livestock and poultry if is meat. Major part of meat produced is consumed locally and very small share is exported. The reason is same the lack of storage and processing facilities. Government should be more proactive in making arrangements in getting more share in markets like of sacrificial animals in Saudi Arabia on the occasion of Eid-ul-Adha/Hajj, which counts to the 1.5 kror animals.
Pakistan has very rich cost abundant with all types of sea products. Sindh and Baluchistan province should focus on processing and exporting of sea food. Again here the problem is the processing of sea food and storage. Major share of catch is wasted due to non proper storage and time wasted between catch and processing. Government should take steps to ensure the availability of much needed power and relaxed duty on import of machinery to ensure that proper facilities are available for storage and processing of livestock, poultry and sea products.
IT/Business Process Outsourcing (BPO)
It is another important sector. Pakistan has realized the importance of it sector in mid nineties. Globally the IT industry was begging to slowdown in mid nineties and after the Y2K phenomenon and 9/11 incidence in 2001 IT sector really was effected by this. Unfortunately this was the time when government was trying to boost it sector under the leadership of Dr. Ata-ur-Rehman, and these incidents really did not done any good to those efforts. On the other hand this left really bad impression on the countless IT graduates who were unable to get jobs and many coming after words.
Despite all these IT industry is still doing far better than many other export oriented industries. The reason for this is that mainly dependent on human resources of a country. And Pakistan has one of the best in the world in this term. For example take the Call Center or BPO (Business Process Outsource Sing) sector of IT industry. Pakistan has very small share in the global market. India is leading the call center industry share by owns more than half of global market followed by Philippines, morocco, Eastern European countries and South Africa.. But is you see the language skill of Pakistan people that had all the phonics available as compared to Indian, Arabic or Chinese English speakers who can not pronounce certain English words and all the call center and BPO is English language oriented. There is no requirement of any raw martial no environmental effects of this service oriented industry. There is no quota by WTO unlike faced by textile industry. In short it is simplest way of generating foreign exchange. After only short training a graduate can be useful resource who can earn forging exchange for the country.
Engineering/Manufacturing
Engineering and manufacturing sectors are of great importance and one that would be a deciding factor in future among the nation. This is so important that existence of the nations will be depending on engineering industry. There are many engineering and production disciplines but I will be talking here about automotive sector. This is sector which never faced any significant economic depression in last 50 years; this can be witnessed by the number of ever growing numbers of cars on out road despite the record levels of inflation, poor business activity and economic slowdown. Secondly there are hundreds of industries that are dependent on this industry to name some are trey industry, plastic molding industry, steel industry, transport industry and many other countless,
This is amount very few industries that can provides the employment both in quantity and quality and both to well educated and not so well educated. Because assembly line operators are low qualified people and highly qualifies engineers are also as important to this industry. Last government of Gen. Pervez Musharf took initiative and Pakistan’s first automotive company ADAM MOTORS was established in Karachi in private sector which was the only 100% Pakistani car, and all parts were being produced in Pakistan. But due some reason the company is now closed which is of great concern as at the same time other international manufacturer of the cars were running extra shifts to meet the inflated demand for cars in the country.
All of major economies both developed like America, England, Japan, Germany and leading developing countries like China, South Korea and India all are being helped by their Automotive industry.
Tourism
At current circumstances when Pakistan is front line in war against terror and law and order satiation also not very good it is very had to attract foreign tourist. Many countries had their travel advisory which is against traveling to Pakistan. How hard we try to attract the foreign tourist, we can make the travel advisories of many countries which claims to be “friends of Pakistan”.
Conclusion
As my discussion has clearly proved that IT sector is of most important consideration.
Pakistan is facing serious crises in power. This need to be address immediate and for long term basis. Here hydral and peaceful use of nuclear power sources should be proffered because these are most economical as well.
As buying power of people grows the tourism is also a main focusing are. PTI has already taken initiatives in this direction in KPK.
by
Azam Majeed
After 71 years of creation of Pakistan the economic condition at both micro and macro level is not hidden to any one. In this article I will critically analyze different sectors of economic growth which are under debate for last two deceases in Pakistan. Here are some of these sectors.
- Agriculture/Livestock
- IT
- Manufacturing
- Tourism
Traditional claim that Pakistan is an agriculture based economy has fooled many at least for last 20 or so years, and had limited the potential of economic growth and prosperity. The fact of the matter is if the planner did not notice the rapidly changing global and regional scenarios thing we are at the point of no return. When supply of water has been limited in a very systematical way by India and so called Argo-based economy for which the water is basic ingredient because most of agriculture is organic based. On the other hand main source of power is also been cut of because of interrupted supply of water in the rivers by India which is building dams in violation of Indus accord.
Due to unpredictable weather and water supply and poor cultivating methods, the per acre yield is falling every year. The fact is that no country can afford to claim to Argo based in ever changing weather phenomenon like ELNINO and ELNINIO and basic supplies like water.
In northern provinces of Pakistan like Punjab and NWFP, the per ca-pita return are comparatively better than southern provinces of Sindh and Baluchistan because water level at the run of the river is hardly enough and soil properties as not well enough. Adapting to ever decreasing fall in available water the southern provinces should have taken the benefit from the available resources like ports/sea and mineral resources available in Sindh and Baluchistan and promote them Instead of complaining for other provinces of claiming their share of water.
In short provinces should have been directed to specialize in the local conditions than following other which they were not good at. For example if Punjab and NWFP want to be industry based they would face big disadvantage over Sindh and Baluchistan that they do not have port available for exports and imports as ion the case of textile industry in Punjab. On the other had if Sindh and Baluchistan wants their economies to agro based they have disadvantage of water scarcity and land is not very suitable for agriculture as compared to Punjab. So ideally Punjab and NWFP can be more agriculture based and Sindh and Baluchistan industry based. Cotton produced in Punjab and NWFP can be processed in Sindh and Baluchistan and exported through the Ports.
Livestock/Poultry/Sea food
Livestock has done well in last few years. Main driving force behind it was the demand for meat, milk and dairy based products. Most of the livestock and related products are serving only the local market. Pakistan is on top ten milk producing countries of the world. But almost 25-30% of the milk produced is wasted and can not be utilized due to lack of storage and processing facilities. There is need of investment in cold storages where milk can stored or converted into long life dried milk powder. Similar is the case with poultry product. Fore example egg produced is only consumed locally and can not be exported due to its perishable nature.
The second produce of livestock and poultry if is meat. Major part of meat produced is consumed locally and very small share is exported. The reason is same the lack of storage and processing facilities. Government should be more proactive in making arrangements in getting more share in markets like of sacrificial animals in Saudi Arabia on the occasion of Eid-ul-Adha/Hajj, which counts to the 1.5 kror animals.
Pakistan has very rich cost abundant with all types of sea products. Sindh and Baluchistan province should focus on processing and exporting of sea food. Again here the problem is the processing of sea food and storage. Major share of catch is wasted due to non proper storage and time wasted between catch and processing. Government should take steps to ensure the availability of much needed power and relaxed duty on import of machinery to ensure that proper facilities are available for storage and processing of livestock, poultry and sea products.
IT/Business Process Outsourcing (BPO)
It is another important sector. Pakistan has realized the importance of it sector in mid nineties. Globally the IT industry was begging to slowdown in mid nineties and after the Y2K phenomenon and 9/11 incidence in 2001 IT sector really was effected by this. Unfortunately this was the time when government was trying to boost it sector under the leadership of Dr. Ata-ur-Rehman, and these incidents really did not done any good to those efforts. On the other hand this left really bad impression on the countless IT graduates who were unable to get jobs and many coming after words.
Despite all these IT industry is still doing far better than many other export oriented industries. The reason for this is that mainly dependent on human resources of a country. And Pakistan has one of the best in the world in this term. For example take the Call Center or BPO (Business Process Outsource Sing) sector of IT industry. Pakistan has very small share in the global market. India is leading the call center industry share by owns more than half of global market followed by Philippines, morocco, Eastern European countries and South Africa.. But is you see the language skill of Pakistan people that had all the phonics available as compared to Indian, Arabic or Chinese English speakers who can not pronounce certain English words and all the call center and BPO is English language oriented. There is no requirement of any raw martial no environmental effects of this service oriented industry. There is no quota by WTO unlike faced by textile industry. In short it is simplest way of generating foreign exchange. After only short training a graduate can be useful resource who can earn forging exchange for the country.
Engineering/Manufacturing
Engineering and manufacturing sectors are of great importance and one that would be a deciding factor in future among the nation. This is so important that existence of the nations will be depending on engineering industry. There are many engineering and production disciplines but I will be talking here about automotive sector. This is sector which never faced any significant economic depression in last 50 years; this can be witnessed by the number of ever growing numbers of cars on out road despite the record levels of inflation, poor business activity and economic slowdown. Secondly there are hundreds of industries that are dependent on this industry to name some are trey industry, plastic molding industry, steel industry, transport industry and many other countless,
This is amount very few industries that can provides the employment both in quantity and quality and both to well educated and not so well educated. Because assembly line operators are low qualified people and highly qualifies engineers are also as important to this industry. Last government of Gen. Pervez Musharf took initiative and Pakistan’s first automotive company ADAM MOTORS was established in Karachi in private sector which was the only 100% Pakistani car, and all parts were being produced in Pakistan. But due some reason the company is now closed which is of great concern as at the same time other international manufacturer of the cars were running extra shifts to meet the inflated demand for cars in the country.
All of major economies both developed like America, England, Japan, Germany and leading developing countries like China, South Korea and India all are being helped by their Automotive industry.
Tourism
At current circumstances when Pakistan is front line in war against terror and law and order satiation also not very good it is very had to attract foreign tourist. Many countries had their travel advisory which is against traveling to Pakistan. How hard we try to attract the foreign tourist, we can make the travel advisories of many countries which claims to be “friends of Pakistan”.
Conclusion
As my discussion has clearly proved that IT sector is of most important consideration.
Pakistan is facing serious crises in power. This need to be address immediate and for long term basis. Here hydral and peaceful use of nuclear power sources should be proffered because these are most economical as well.
As buying power of people grows the tourism is also a main focusing are. PTI has already taken initiatives in this direction in KPK.
