IT could be a scene from a book or a film: a man sets up shop and begins to do well. But all too soon, the stranger of whom he has been warned arrives — the goodwill of the gang dominant in the area must be bought. Or, the entrepreneur receives a note demanding money. Taped to the paper is a bullet. In fact, this is one of the most basic realities of operating a business, no matter what the scale, in Karachi. Ironically, it is in the days leading up to Ramazan and Eid that the operations of various extortion gangs in the city are in full swing. And because many areas in the city are the domain of more than one gang, trading and business concerns often find themselves having to pay up to several different parties.

It is well known which groups run extortion rackets: they range from quasi-criminal gangs allegedly supported or even run by mainstream political parties to criminal rings and, in recent years, extremist/militant outfits that are increasingly flexing their muscles. What is shocking, though, is the fact that while the racket is expanding, there are few signs of an effort to crack down on it. Figures collected by the Citizens-Police Liaison Committee show that so far this year, 630 extortion-related complaints have been registered, as compared to 589 last year; the police say that this racket runs into hundreds of millions of rupees annually, and that this will be a record year. But businesses and law-enforcement authorities seem to have reached a point where they treat the shakedowns as routine and even build the cost into their financial outlay estimates. Meanwhile, the impact this practice has on the country’s economy goes unremarked, although it includes implications for everything from investment levels and insurance to the banks’ risk assessment and loans. Unless the country’s financial hub stops resembling gangland, can a positive long-term projection of the economy really be made?