you really think a rail lane line can transform the entire landscape where a good manufactured in Peshawar can become competitive with that of Karachi or hopefully in the future Gwadar ?
I really don't think so - first its probably for passengers and even if it is for goods- what's its planned capacity like? how many tons of goods it can transport and in how many days? (so many things to consider)
We already have motorways how can rail line one-up them from a manufacturer's perspective?
Mining and the value added labor intensive processes that go with them. Also,
modern farming, with high yields exported via railways is a fundamental base for further industrialization (because it provides the excess profit to reinvest in other industries).
Reko Diq is key to building up a mining sector and all associated industries, even if Reko-Diq is a partial loss leader to get access to foreign tech, training, management, and access to markets. Further a large part of
Baluchistan has really good solar power generation potential, but the problem of energy storage is key, so
pumped hydro between the Indus and near by hills could solve that problem. Generate almost double the energy during the day, and let gravity solve the energy needs at night.
Ideally we should be shipping by water, because it is cheapest,
but rail is a lot cheaper then by road, because it takes a lot less energy (electricity or fuel) to move the same amount of weight over a long distance. Rail has less friction (steel wheels on steel rail) versus rubber tires of a truck on an asphalt road.
Southern Pakistan (mostly
Karachi) can become competitive in manufacturing like Hong Kong or Singapore did by having access to cheap inputs and good governance/management and reinvestment of as much profits back into the economy. Karachi’s industries should follow the business model of the German
mittlestand (small and medium enterprises that are highly specialize and skilled to meet niche demands in a globally competitive manner)
To this end, Karachi also needs a
modern high volume oil refinery and natural gas storage facilities to be competitive in the way Many port cities around the world are for petrochemicals and pharmaceuticals
Pakistan as a whole needs to be economically
integrated into its region to lower costs (but at the risk of our own industries being destroyed by cheap imports we need incentives to nurture industries Pakistan can be competitive in for the long term, and allow the import of most other goods, at internationally competitive prices to lower inputs for our industries)
To better integrate into the region we need to make ourselves useful as a conduit for the trade of other and use their transit as a means to build up our own industries to support their businesses.
A rail line between Gwadar and Points west to Europe through the Iranian network will create a reason for Gwadar to attract Chinese investors and Pakistani laborers.
A possible oil pipeline between the gulf countries and Gwadar should be built to make Gwadar and energy storage point outside of the Gulf region. It can be a good location for investors to store their oil and gas for sale as prices move up and down. Gwadar being along the shipping routes and rail routes could be seen as a strategic oil or gas reserve if marketed correctly.
If the situation in Afghanistan becomes stable, a rail line between Quetta and Turkmenistan should be built to bypass the Iranians, to link up with the Turkic world, just to make sure we don’t become dependent on the Iranians.
If successful, the line can be extended to Karachi. And
if we can resolve issues with India, that line could be extended to the western dedicated freight corridor of India, via the track that could be built to the Thar coal fields. With this kind of infrastructure, other industries could more easily attract investment and our entire coastline could be come an industrial area with urban living for tens of more million people.
Speaking of urbanization, we need
more cost effective apartment buildings that are passively cooled by design to lower the cost of living for the population, so people have more disposable income to spend on better education, health, skills development, leisure, investment in their businesses, etc.
Better business retention in Pakistan will also prevent companies from feeling they have to relocate to places like Dubai. Pakistan needs to retain profitable companies that only move to Dubai for tax breaks and other promotions.
Besides India,
a rail corridor over the Karakoram mountains into China (via a train route along the rivers), would create a route for trade between the Middle East / Africa and Central Asia / China / Russia. It would be a game changer for regional economic dynamics, but with FDI into Central Asia from mining companies it could change global trade. A spur from the route between Pakistan and Tajikistan via the Wakhan Corridor could make it palatable for Western investors looking to avoid going via China and avoiding most of the uncertainty of Afghanistan.
A train route that would look like this but wider (meandering further from the sides of the river) to account for the steeper climb
When rebuilding Mainline 1 (and all the other mainlines for that matter) the
urban cores should be avoided with a set of bypass track for freight, so that goods can move as fast as possible. But in urban areas the tracks should be shred between trains that cross the whole country and
commuter trains so people can live further out and have lower cost of living. It’s a cheaper way to build “Metro Trains” on the infrastructure we already have.
Connecting where possible, each city’s bus stations and airports to give travelers more options. Upgrading the bus stations and train stations to have shopping malls and hotels is a 200 year business model to pay for improved rail infrastructure and should be implemented in Pakistan.
We should study how Chicago, the largest rail hub in the US became an industrial powerhouse to understand how best to utilize our massive population that lives much more inland then would seem optimal for economic growth.
We also have so many textile manufacturers. It is the time for these manufacturers to start employing local talent to see if they can create local fashion brands for the global market. The government should provide some initial partial funding, bring in a foreign or local third party investor and give incentives to the textile factories with some tax breaks to put up the rest of the funding.
The textile industry NEEDS to move up the value added chain.
We also need to get more efficient with water use to make the entire eastern side of the country from the current agricultural lands up to the Indian border (as much as possible) fertile farmable land. It will also spread out the growing population over a larger area and help secure the border areas, rather then leave them open for thunder runs by enemy armor formations. We need more water treatment plants and infrastructure to send water back into the acquifer when it floods to replenish the acquifer. This will reduce harmful substances in the water, improve health, and stabilize water supply, lowering cost for people to get clean fresh water.
P.s. we need to find ways to maximize the matching of local entrepreneurs with foreign capital. People who are willing to invest their own time and money with an outside (local or foreign) investor to create growth; micro finance but on a nearly industrial scale, to get the benefits of economies of scale without putting too much debt burden on the local entrepreneur.
summary
1. Modern rail industry to minimize shipping costs. With bypass tracks to avoid cities for freight and maximizing use of rail in cities for commuter rail.
2. Mining and all support industries
3. Modern farming and maximizing arable land
4. Solar panel manufacturing and wider utilization to speed up rural industrial farming and government services without being dependent on the national grid
5. Pumped hydro to store excess electricity for later use and to minimize need for imported fuel based base energy solutions
6. Getting Karachi back on its feet as a globally competitive manufacturing location; build up the “mittlestand”
7. Oil refinery to jump start the petrochemical and pharmaceutical industries
8. A rail line to China with an independent spur to Central Asia through Wakhan corridor (for western investors, and to stabilize relations with Central Asians and gain some influence there while Russian economic influence declines.
9. Rail line along the coast of sanctions IF Iran are lifted to ship oil in and goods out via rail, with possible extension via Thar rail to India to utilize transit trade if relations improve between the two countries.
10. Passively fooled apartment buildings to lower cost of living and free up people’s disposable income.
11. Water treatment plants and acquifer replenishment infrastructure.
12. Attract back business that fled to Dubai
13. Go up the value added fashion industry for textiles; build globally competitive brands.
14. Attract at least 3-5% FDI year on year. (For the size of our current economy we would
need at least $11.5-19.25 Billion dollars of FDI this year, and growing year after year).
FDI NOT LOANS!
15. If foreign relations can be improved, loans need to be refinanced to the lowest possible interest rate ASAP to minimize the amount spent on interest payments.
16. Subsidies need to be phased out as much as possible to have services run on market prices so we only do economically feasible projects and not built white elephants, and all economic inputs are priced accordingly including labor to make the country attractive to investors to speed up industrialization and boost wages while lowering cost of living as was done in China over the last 40 years.
17. Government owned industries can no longer be given preferential costs because it undermines new investments. Elite capture needs to end to grow the pie, so in the long run everyone including the elites benefit with a larger economy.
Incentives should be devised to attract overseas Pakistanis to turn remittances into investments in foreign export earning industries, such as the ones outlined above as well as
import substitution where with investment Pakistani industry could become competitive.
We also need to cut back on “development project” that are structured to win votes. The establishment should not let political parties, no matter who they are, to be allowed to run their election campaign on the national credit card.
