Girding for an economic boom

Updated 06 Jul 2020

Email

There are a host of grandiose schemes in planning that might prove a gamechanger for the strategically located but underdeveloped province. — File
There are a host of grandiose schemes in planning that might prove a gamechanger for the strategically located but underdeveloped province. — File

WITH a deficit of Rs87 billion, Balochistan’s Rs465.528bn budget for the next fiscal year prioritises and increases spending on education and health. With a development outlay of Rs106.079bn, the provincial budget allocates 17 per cent or Rs64bn for education and 10pc or Rs38bn for health.

The Balochistan Awami Party-led provincial government continues to increases allocation for social sector development. In last year’s budget, the allocation for education had been increased by 10pc, while the health budget witnessed a 26pc increase. Moreover, last year, the provincial government increased expenditure on social protection by 468pc.

“Prioritising education and health sectors in the most backward and least developed province is a good step towards human development,” said Professor Tousif Akhtar, former Balochistan member of a penal of economists at Planning Commission of Pakistan.

Professor Tousif said, “human capital is direly needed to develop the province’s huge natural resources. The economic managers in Quetta need to focus on social sector development in the next five years with special focus on technical and vocational education so that the province could provide the required skilled labour and qualified staff for port operations, cargo handling and other economic activity.”

“The locals’ participation and ownership of the mega-development process will ensure real security to the numerous development schemes, which are currently in planning or execution stage in Balochistan,” he added.

Read: Balochistan Budget: Juggling expenses

In the wake of Chinese-funded mega development process under the $62bn China-Pakistan Economic Corridor (CPEC), Balochistan is in juxtaposition with both formidable challenges and enormous opportunities.

The locals’ participation and ownership of the mega-development process will ensure real security to the numerous development schemes, which are currently in planning or execution stage in Balochistan

Gwadar port is the soul of CPEC. The port offers a much shorter overland link to Afghanistan. Afghan transit trade through Gwadar port is already operational. The opening of the port for Afghanistan’s import and export of goods is bound to create numerous job opportunities for the local people. The local population will get involved in economic activities as soon as port operations gain momentum with the frequent arrival of cargo ships in Gwadar.

There are a host of grandiose schemes in planning that might prove a gamechanger for the strategically located but underdeveloped province. In August 2019, the Gwadar Development Authority accorded the final approval to the master plan while the feasibility study (PC-II) for implementation of Gwadar Smart Port City Master Plan was also approved. With the growth of the port city, enormous employment opportunities will be created for locals. Moreover, the development of the port, free zone and industrial zones will accelerate economic activity in the province. The employed population is expected to reach 9,000 to 12,000 in the short term, 24,000 to 30,000 in the medium term and increase to 100,000 to 120,000 in the long term. Labour participation will also be increased and Gwadar will become a productive and efficient city, according to the master plan.

Not just Gwadar, but the whole of the province is going to benefit from the numerous infrastructure projects planned under CPEC, which has added to the geostrategic importance of the province. In view of the expected surge in trade and economic activities in Gwadar, is the province braced for an economic boom?

The efforts on the official level in developing the social sector will only be fruitful if the funds allocated are efficiently and honestly utilised by the economic managers in Quetta. The physical targets must match with fiscal targets. The province needs a robust and well-developed institutional network to avert underutilisation of annual development funds.

Illiteracy is higher in Balochistan and hence people lack initiative and entrepreneurial ability. The province has no skilled and trained labour to benefit from the economic boom. The government needs to invest the right amounts for the appropriate types of education.

The geographical and financial constraints in social service provision and low investments actually limited the scope for financing the social sector in the country’s poorest province.

Balochistan has by far the highest rural poverty rate, with more than 62pc of its rural population living below the poverty line, according to a World Bank report released in November 2018. The report noted that the majority of the 40 poorest districts were in Balochistan. The districts in the country varied widely in poverty, with the poorest district — Washuk in Balochistan — at 72.5pc.

Balochistan constitutes 44pc of the country’s total landmass and makes up only 5pc of the country’s population. It presents a classic example in the Pakistan federation of a small and impoverished province, which has remained on the political periphery of the country for decades. The appalling condition of the socioeconomic indicators, particularly in the remote rural areas, present the picture of the medieval age. Politically speaking, the conflict in Balochistan is rooted in the decades-old Islamabad’s policy of discrimination and neglect toward the province.

Locals resent the control of central authorities over the province’s natural resources and the arbitrary nature of the decision-making process in Islamabad. This fuels the feeling of alienation among young Baloch. The time calls for inclusive planning and development of the province’s natural treasure trove with active local participation.

The federal government should take some special legal initiatives to protect the locals’ first right to become the primary beneficiary of the mega-development schemes planned under CPEC or the new Gwadar Master plan. The underdevelopment and technological backwardness of the province should not be allowed to isolate the local people from the economic boom Balochistan is set to witness in the years to come.

The federal government needs to take practical initiative for the development of human resources by opening technical institutes imparting training in required skills in cargo handling, trucking and port operations in every district of the province. Such initiatives could help alleviate the feelings of alienation and frustration in the province and bring the province fully back in the national mainstream.

The writer is a contributing analyst at South Asia desk of Wikistrat

Published in Dawn, The Business and Finance Weekly, July 6th, 2020