THE Punjab government plans to carry out a census of services with a view to formulating its strategy to assist the sector realise its growth and export potential.

The census is to be conducted on the recommendation of the WTO Cell of the provincial Planning & Development (P&D) Department which has been asked to work out a comprehensive strategy or road map for the rapid growth of the services sector in consultation with the stakeholders.

WTO Cell chairman Inamul Haq says that the Provincial Bureau of Statistics” “is currently firming up parameters of inquiry, and developing the format for conducting the census. A lot of thought is being given for deciding the parameters.” He is hopeful that a consultant for conducting the census will be selected and hired in the next couple of months, and the actual exercise begun before the close of the current financial year.

A Services Development Cell has already been set up in provincial department of commerce and investment on the recommendations of the WTO cell. But another proposal for the establishment of a Services Development Board, an apex body at the provincial level, comprising different stakeholders has so far not gained much support from the authorities.

The entire exercise to create an enabling environment for rapid and smooth growth of services sector has been undertaken by the provincial government to further boost its share in the provincial GDP, estimated in 2004-05 at 52.5 per cent as compared to its contribution of 52.4 per cent to the national GDP. The services sector in the province is said to have grown at a rate of 9.23 per cent during the same year.

“As the provincial economy is advancing with the passage of time, the share of the services sector in its economic growth is going up,” says Mr Haq. “In fact, the growth rate of services has outpaced the overall economic growth of 7.8 per cent in the province and more jobs are being generated in this area of economy than in any other sector. This calls for formulation of a comprehensive strategy that can help realise the untapped potential of this important sector and augment the supply capacity of services for producing exportable surplus. If the current rate of economic growth has to be sustained and jobs created, the government will have to focus on services.”

Mr Haq feels that Punjab has got immense potential for growth in the services sector because it has relatively more skilled manpower and higher degree of entrepreneurial spirit, and comparatively more favourable business climate than the other parts of the country.

Moreover, he says, Punjab has been investing substantial amounts in education as well as development of infrastructure, especially in the IT sector and human capital.

The provincial government(s) can play a critical role in the development of services as these are provided in a given territory. “The provincial governments can facilitate services to enhance their capacity to export and advocate for the weaker services with the federal government,” the chairman says.

He says it is important to facilitate services because this sector is labour intensive and gender friendly, and its progress and growth can have far reaching social and economic consequences. Services are an important source of value addition in other sectors and intimately linked with the quality of products and life.

Moreover, the benefits from the liberalisation of global trade in services are estimated to be around $500 billion, and the developing countries are projected to reap as much as two-thirds of these gains. “Pakistan should also try to take its share from the pie, and everybody – the central government, the provinces, and all other stakeholders – must work hand in hand to capture the opportunity that liberalisation of trade in services promises to offer,” he says.

According to a non-governmental organisation working in the area of sustainable development, among the South Asian nations, India was the biggest exporter of services as its exports in this sector exceeded $25 billion in 2003. Pakistan, the second biggest exporter of services from the region, fell way behind India by exporting services worth only $1.485 billion the same year. Sri Lanka closely followed Pakistan with export of services to the tune of $1.385 billion. Bangladesh exported services worth $404 million and Nepal to the tune of $267 million.

Mr Haq says the provincial governments have a major role to play in streamlining and improving the regulatory environment, strengthening need-based skill development, and encouraging research and training through the establishment of institutions for boosting export of services.

The WTO Cell has proposed to the provincial authorities to focus on construction, niche tourism, financial services and information and communication technology, and support these services by creating infrastructure and training human resource.

“It is advisable for the province to focus on these services because in the given global scenario, the chances of exporting manpower are not very bright (as was the case in the 1970s and 1980s). Punjab has a lot of potential for attracting religious tourists like Sikhs and Buddhists to its soil, as well as boosting the construction industry. Similarly, we have the same advantages, including English-speaking population, due to which India has been able to boost its IT sector.”

Though there has been a slight movement in the direction of development of knowledge-based services, the services that have flourished in Punjab in the recent years comprise the ones that largely require unskilled or semi-skilled labour and semi-literate workers.

Even the services that need skilled and literate manpower have to do with semi-literate and semi-skilled workers because of an acute shortage of educated people who are properly trained for working in these sectors. The province, which has relatively more literate and trained manpower when compared to other provinces, still has a long way to go before it actually can realise its untapped potential in the services sector.