ISLAMABAD: Prime Minister Shaukat Aziz believes that in about 10 years Balochsitan would be ahead of many parts of the country in terms of development, growth and per capita income. In an interview with Dawn at Prime Minister’s House on Friday, he did not agree that demography of the province was changing to the disadvantage of the Balochistan population and said it was in fact resulting in asset formation.
Following is the text:
Q1: Are you satisfied with the current system of resource sharing between the federal and provincial governments and among provinces? Is the government at some forum considering reformation of the concurrent list in a spirit of accommodating the demands of smaller provinces and Balochistan in particular?
Ans: The resources are distributed under the existing resource sharing mechanism, which was agreed to by the stakeholders. Now the NFC has been under discussion for a new accord, and it will be finalized when all the five stakeholders agree. The major challenge we had last time too was agreement between some of the stakeholders and we are now in discussions so that we can come to an amicable arrangement. Yes, I am satisfied but, we may renew the distribution mechanism under the constitution, which will take place again this year. In the past we had extensive discussions to achieve this objective. All the four provinces and the federal government are working to come to an amicable arrangement.
In Balochistan, in addition to what is NFC gives to the province, there are many flows of funds in the development projects. Currently, 13.4 per cent of total PSDP is going to Balochistan.
Five years ago, it was very very low. Since then we have launched several projects like Gwadar Port, the coastal highway, the Mirani Dam, the Sabakzai dam, etc.
So the federal government has many ways to help the provinces through development, guaranteeing loans from the donors as we have done for the ADB loan to the provincial government which the province could not have so much on its own. In addition, we are also building a Rs700 million road at Uthal where the federal government is paying half of the cost. This is not mandatory but we are doing it to accelerate the pace of development in Balochistan. Same is the case with water supply, health sector, education, and lady health visitors. So there are many ways to help the provinces either through direct funding, or guaranteeing loans, development programme and many federal government projects, which are outside PSDP Wapda, SSGC, SNGPL and NHA projects. I was travelling on the N-25 in Uthal where I was told that I am the first prime minister to visit Uthal and Duddar. We have just given a Rs1 billion land to Balochistan free of cost to build an agricultural university.
So, I think there is a strong desire on part of the federal government to help the province because they have large areas with minimal population. There is a tremendous potential and areas of growth and opportunity exist in Balochistan.
The first area is oil and gas where we are drilling more, and opening up more areas because the royalty on oil and gas goes straight to the province. So this is one of the most effective sources of income, which is outside the NFC.
On the concurrent list, the sub-committee of the parliamentary committee is looking into it as an issue, when they give their recommendation, the government will look into it and see how and what these recommendations are and then come up with a view. So this is really a whole healthy process to see various issues. Naturally, any change in the list affects all the provinces and the federation and would have to be looked into when recommendations are there.
In the mining sector, the federal government has brought the Chinese to come with a lot of incentives to reopening the Saindak, which is now being doubled. Then the government has brought in an Australian company in Rekodiq and third is the road link to lead and zinc mines. It will open up new areas. What Balochistan needs is good roads communication, education and health facilities.
Balochistan has always been a major supplier of livestock; a lot of people in Balochistan have a nomadic lifestyle, which suits the livestock. Now, the federal government, in addition to what the provincial government is doing, is coming up with a programme of promoting livestock through veterinary health, technical assistance and funding.
There is a lot of opportunity in fruits, dry fruits and high value crops in the non-irrigated areas, which the federal government is trying to develop besides the cotton, wheat, sugarcane and other traditional crops.
Since Balochistan has the longest coastline, we have to develop sea food, fisheries, hatcheries through the latest techniques to create job opportunities and the coastal highway is going to help a lot so that the produce could go to Karachi in time where they have factories. We are also encouraging the people to set up factories; one large factory has already become operational in Gwadar. This can also offer a lot of opportunities in the field of tourism as a number of hotel chains are looking at the port. We are also building a new airport in Gwadar so that people can fly in and out on jets. We have a major port there, which is transit, and trans-shipment port for central Asian countries and Afghanistan. Agro-based industry has the best potential where meat, fruit juices, vegetables and other agricultural products could be packed and shipped overseas.
So the solution is not just in building the infrastructure but the solution is to give people skills. Here the government is coming up with major vocational initiative for Balochistan. But to do all this, we need security.
Q2: There are concerns that the upcoming Gwadar Port will meet the fate of KPT and Port Qasim as it has also been planned as a feeder not a hub port, your comments?
Ans: KPT and Port Qasim are functioning very effectively. They are profitable. If Gwadar port can function like Port Qasim and Karachi, we will be very happy. There is no harm in being a feeder port. Feeder ports are very effective, they fast turn-around and the purpose has to be if you appreciate the operations of ports is to get goods in and out fast. If you get a huge vessel with 5,000 containers, the bulk thing may or may not be the most viable thing to do because you need that much of heavy traffic coming from one destination to another. In our case, there are multiple destinations sending us goods in for multiple uses.
I am very excited about the Gwadar port because it has reasonable draught, it will be quick. The major challenge for the Gwadar is to build infrastructure of roads to Gwadar and Chamman and even linking to Indus Highway. So through Kohat Tunnel, the traffic can reach Torkham or other 12 points from current three points.
So we are working hard through own resources, provincial resources and ADB to link up these areas. The Draught is not an issue.
Q3: What was the wisdom behind turning down the suggestion of Iran to create a border trade area when there is already a free flow of goods from that country?
Ans: The proposal is not under consideration. But we are going through preferential trade arrangement and free trade arrangement route. There is no harm in border trade if we achieve a tangible agreement only if it makes sense for use. Naturally, we don’t want to do it to encourage smuggling. Yes, the smuggling takes place but it is in very limited quantity. That does not mean that we should institutionalize smuggling.
Q4: Why the provincial government was kept out of the management of mega projects?
Ans: There is no such thing. Let me say that the federal government executes all the projects — if you take Mirani Dam for example — because they have the resources and the ability to execute them. The provincial government is always a party to the whole project because they are part of the CDWP, Ecnec and NEC.
No development project can go through without, not only that government, but also all the provincial governments because sometimes they have an impact on other provinces. But all ministers and chief ministers are sitting in these meetings. They are elected representatives of Balochistan, in addition to the civil servants. The execution is done through tenders.
And let me say that the person who is heading the Gwadar Port Authority is a Gwadarian. This is federal entity. The provincial body Gwadar Development Authority is headed by a senior civil servant who is a Baloch
Q5: How long will it take to bring the economy of Balochistan at par with the economy of the country?
Ans: The economy of Balochistan is to grow the fastest because the base is very strong. It has a lot of strengths and limited populations, which mean that the per capita income, we think, will be higher because they don’t have some of the problems, which exist in other provinces.
Five years ago, Balochistan was neglected over a long period of time. Now we are trying to catch up but Rome was not built in a day. Balochistan people have to seize the moment, seize the opportunity through better educating themselves, better skills and through having an attitude where they can benefit from all this development taking place.
Q6: Does the government plans to offer some package of incentives to accelerate the pace of industrial investment in the province?
Ans: In the industrial investment, there are enough incentives. That’s why the people are coming in. We have declared all the mining areas as export processing zones (EPZs), which are the biggest incentive, which means there are no taxes because these are exportable items. Then we can give incentives in the infrastructure and training the people and that’s what we are doing. Because if you give any fiscal incentives, the exportable products may attract countervailing duties. We have to build infrastructure, so that they have electricity, telephone, gas and that’s what happening now.
So the biggest potential is in mining, agri-business, agriculture, tourism, oil and gas. The incentives have to be linked to the comparative and competitive advantage of that province.
Q7: How you view the issue of demographic change taking place against the Balochistan population?
Ans: Balochistan population too is increasing. Its demographics are similar to that of other parts of the country. The basic pattern of demographics is not changing in Balochistan. All populations are increasing, the Balochs, the Pushtoons, all relative to rest of the country, they are also maintaining the share. So I don’t see demographics changing. If you are implying that people are coming, they are coming for investment. That does not change the demographics. Demographics change when you have permanent people staying. The people may be coming for investment but that never changes the demographics. If you look at anywhere in the world, where they open up for investment, capital comes in. So the preference is always to hire the local people, that what the government is always trying to do, why should bring in people from outside at higher cost when they can get local people. In certain specialized areas, of course, people come in from everywhere, you go to Karachi today it is a cosmopolitan city, so is the case with Lahore, Islamabad and even Peshawar where Afghans, local Pashtu and Hindco speaking and settlers live because it increases the size of the pie, makes development richer. Even those countries, which were closed — like China and Russia that grew up under the socialist regimes — are opening up to professional modern world and nobody who opens up a factory or hotel or industrial entrepreneur in any part of Pakistan can put it in a brief case and walk away, it becomes an asset of the country.
So we have to bring the province at par with rest of the country and then it creates opportunity for the people to leverage what is very rich resource base in mining, hydrocarbon, agriculture, fisheries and tourism, etc.
Also, we have to have good levels of governance because the world today is very competitive and what the government has tried to do is to develop Gwadar and coastal highway, which would lead to prosperity.
I can visualize a lot more activity in mineral, mining, hydrocarbon exploration and investment coming in with improved infrastructure. Afghan government has already asked for providing warehousing facilities at Gwadar because they can see a lot of things happening there. And the government also wants to balance development in all parts of Balochistan because it is huge province and offers a lot of opportunities.
