On the move: yes, but on a slippery track
By Murtaza Razvi
THERE are a few lessons to be learnt by the rulers of Punjab as well as their counterparts in other provinces from the way Punjab has been emerging as a hub of industry and commerce in recent years. Development taking place in various sectors points to the position of Punjab and its prospects as an ‘island’ of prosperity vis-a-vis the rest of the country in the years ahead if growth patterns continue on their upward spiral.
As an economically growing Punjab demands more water and power and a higher share in the National Finance Commission award, prospects of integrating this relatively affluent federating unit with the rest of Pakistan are coming under a strain.
This is not to say that Punjab does not face a lack of vital development infrastructure or shortages in the energy sector. Given the expanding scale of the province’s public and private sector economy, Punjab’s per capita consumption needs and wants are far greater than those of any other province. Many also see the largest of the federating units getting more, at the expense of the other three provinces, than it deserves. This is because of the absence of a number of factors which should be assigned appropriate weightages in the national resource-sharing formula, such as the actual revenue receipts of the federal government and the levels of poverty prevailing in smaller provinces.
The difference seen in the upward economic trend in Punjab as compared to elsewhere in the country is that a very aggressive, emerging private sector refuses to be stymied by fine points requiring a political consensus among the provinces. It has taken initiatives on its own in many areas over the years, forcing successive provincial governments to go along and facilitate development. This gung-ho approach on the part of the emerging entrepreneurial and industrial elite may be the only way to extract any concessions out of the government, but it will not help Punjab achieve in the longer term what it wants given the federal scheme of things as it exists now.
In spite of the many civic and social problems which pretty much reflect the national trend in Punjab too, it is not only in and around Lahore that one sees a flurry of economic activity; other industrial centres such as Faisalabad, Sialkot, Gujranwala, Multan and Sheikhupura are also abuzz with growing industrial and economic goings-on. Greater Lahore area has emerged as a story of an expanding ‘ribbons of development’ theory, as the urban planner, Raza Ali, once described the phenomenon of urbanisation taking place along highways in Pakistan.
Highways leading out of Lahore, to the south (Raiwind), south-west (national highway to Karachi) south-east (Kasur), west (Sheikhupura) and north-west (G T Road to Peshawar) have a beeline of big and small industrial units lining them for miles on end. The manufacturing boom is quite diverse in its scope: there are automobile assembly plants, textile, household and consumer goods, electronics, chemical and steel mills, pharmaceutical factories, tanneries, flour and rice mills; in short, you name a sector and it is likely there. Commercial banks, including many foreign ones, are rushing in to collect the windfall generated by hectic economic activity. Multinational banks’ branches equipped with state-of-the-art banking technology are now to be found along these ‘ribbons of development’, up to 30km out of the city centre.
In Sialkot, the local industrialists have taken the initiative on their own to fund the construction of an international airport which is near completion and which will serve as an important cargo destination for PIA and other international carriers for the export of sports goods and surgical instruments. The Punjab government has finally realised the scope of this community-based initiative and announced plans to link the city with Lahore, Gujranwala, Gujrat and Wazirabad, the other industrial bases in the vicinity, through a series of six-lane motorways.
The Punjab government’s Sundar industrial estate project, located 40km from Lahore, has been a success story. Plots there were sold out within weeks of its commissioning, with industrial units there becoming operational in a record time of just over a year or so. Along the Lahore-Islamabad motorway, there are now signs of industrial activity, with smoke billowing out of what was once wilderness, considered a bandits’ territory and the backwaters of central Punjab. A number of Middle East-based consortiums have been allotted land in and around Lahore to build commercial skyscrapers, shopping malls, luxury hotels and apartments, and to set up a modern sport city equipped with international standard facilities.
In the education sector, too, foreign donor agencies are satisfied with the initiatives taken by Punjab in raising adult literacy and improving primary school enrolment. In his recent visit to Lahore, the Sri Lankan prime minister sought help from the provincial government in the public education and health sectors in his country. Although a lot still needs to be done in these two sectors, some strides have been made. The Aga Khan University Examination Board, in a recent assessment, has also declared Punjab as the most willing partner in implementing the board’s examination system, which is on a par with international standards, leading to quality higher education at the university level.
The sea change has come about not as a result of a miracle but sustained economic policies that successive Punjab governments have been made to pursue under pressure from entrepreneurs and industrialists over the last two decades, in spite of political instability. Today, the foreign investment component makes up a good percentage of the emerging industrial and development scene in Punjab, thanks, again, to the emergence of a powerful private sector, which has shown the confidence and the ability to do business with the rest of the world and deliver, notwithstanding political hiccups and uncertainties.
The construction sector and the service industry, too, have seen a phenomenal growth, which is continuing in its third decade now. The hotel industry is particularly a hot seller, with the average room occupation in Lahore’s big and small hotels and over 100 ‘guest houses’ standing at no less than 80 per cent. The last mentioned have proliferated to fill the gap created by a growing demand on regular hotels for accommodation; a number of five-star hotels in collaboration with foreign investors are planned to be built over the next few years to cope with the rising demand.
In the Punjab capital, consumers are spending money on their needs and wants. The sheer number of new, fancy supermarkets, shopping malls and specialty stores selling local and imported foodstuff and luxury consumer items is unprecedented, and arguably the sign of an economy on the move. Also, try getting a seat on an international flight out of Lahore and you’ll realise how overbooked the air carriers are. The travellers and consumers are not just Lahoris, but also their wealthy country cousins, the emerging class of industrialists in the immediate vicinity of the city.
There is euphoria among the business class of reaping more economic benefits from prospects of the easing of trade with neighbouring India. It is estimated that some 14,000 Indians, among them businessmen and traders, either come to Lahore or transit through the city on a monthly basis. Not only an ordinary Indian, but journalists and entrepreneurs, too, marvel at the prosperity they see in and around Lahore. Plans are afoot to further strengthen the existing economic relations between the two Punjabs, both at the trade and the government levels.
All this augurs well for the province’s economy, but there remain serious political questions that have not been taken up by Punjab’s ruling elite with regard to integration of a yet more prosperous Punjab with the rest of Pakistan. It is here that the rulers of this province have shown little inclination to reach out to other provinces.
The Punjab chief minister and other high-ranking officials have the time to hop across the border and cosy up to their Indian counterparts, but they have no time to visit Sindh, Balochistan or the Frontier to promote understanding and to remove the misperception there Punjab’s opposition to what the smaller provinces growing prosperity is at their expense. It is inexplicable how successive Punjab governments have neglected this basic reality, to the detriment of the province.
The Punjab government can strengthen the existing socio-economic links with the other provinces and establish new ones in areas in which Punjab has made significant progress in recent years. While Punjab has successfully reached out to foreign countries and economic and business concerns there, conducting aggressive economic diplomacy without much help from Islamabad, it has been found woefully lacking in adopting a similar approach towards the other federating units. The failure to make Sindh, Balochistan and the Frontier stakeholders in the economic rise of Punjab can significantly slow down Punjab’s own progress by aggravating the already tenuous inter-provincial relations, which may eventually spiral out of control if political apathy on the part of the rulers continues.
There is no non-political interest group, as is the case with industrialists and entrepreneurs driving economic development and pressuring the provincial government to broaden the existing infrastructure in Punjab, who could do the required job. Nor are foreign investors interested at this stage in bringing about a more politically integrated Punjab with the rest of Pakistan; many took their invested capital out of a politically volatile Karachi in the 1990s and reinvested it in Lahore and Islamabad. The job will have to be done by politicians, both from the ruling party and the opposition that have a national vote bank in all the four federating units.


