With the United Nations General Assembly in session and the world leaders making their addresses about the future of our planet, ranging from climate change to regional peace, it’s important to pause and look at how the previous promises and objectives materialised. What were once the eight-pointer Millennium Development Goals after expiry in 2015 gave way to the rebranded (but 17-part and more aggressive) Sustainable Development Goals, hoping to achieve gender equality or quality education.
One of the new additions in the new agenda was the goal of Industry, Innovation and Infrastructure, the SDG9, a front where Pakistan has unfortunately been a laggard not that we are leaders elsewhere.
According to the 2021 SDG dashboard, the country continues to face significant challenges with respect to goal 9 and the progress is stagnating. In fact, this is our worst performance in any goal along with gender equality (no surprises there) with a score of just 25.
At 13.5 Mbps, Pakistan ranks 162nd for broadband performance according to the Global Index by Speedtest.net
Here too, the saving grace has been the positive trend of rising mobile broadband subscriptions which were given a value of 35.2 in 2019. At least on this front, the progress has continued as the number grew to almost 106 million by August, compared to 83.1m as of 2019-20 end. So much so that this figure (along with smartphone users and population under the age of 30) is being pitched and milked for the past two years by some venture capital firms investing in the country.
Anyway, while the growth has been nonetheless impressive as visible from the teledensity of almost 87, it’s not without caveats. Firstly, it has been extremely uneven with 4G connectivity mostly following the same route as highways and motorways in the case of a majority of carriers. That means much of Balochistan — even Gwadar which is supposed to be the pinnacle of China Pakistan Economic Corridor-driven development — is left unserved. Similar is the fate of the erstwhile Federally Administered Tribal Areas and the Gilgit Baltistan region where netizens have been demanding 3G and 4G for quite some time.
Some improvement was expected on this front earlier in September when the government conducted the spectrum auction, only to be boycotted by everyone but Ufone. The story was similar in AJK and GB where Telenor was the singular bidder for the 15 MHz spectrum in 2100 MHz bands.
And it’s not just the nationwide coverage where there are gaps. Even in areas with access to the internet, the quality is generally below par. According to the Global Index by Speedtest.net, Pakistan ranks 120th with an average download speed for mobile at 19.79 Mbps whereas the broadband performance is even worse at 13.5 Mbps, putting us in 162nd place. On both metrics, the country has seen its position slide down.
The SDG-9 also talks about building a resilient and sustainable infrastructure — an area where Pakistan’s (particularly Karachi’s) performance is best seen right after the first sign of showers and roads get flooded. According to the World Bank’s quality of overall infrastructure, the country ranked 82nd (out of 137) in 2017, registering a fall of 12 places compared to the 2007 value — giving a pretty solid idea about our direction over the past decade.
Meanwhile, with respect to industrialisation, the less said the better. Take textile, the country’s blue-eyed sector credited with bringing in the most dollar inflows, which recorded the highest-ever export proceeds in June 2021 at $1.459 billion. For context, this amount is not even $100m higher than the peak hit exactly 10 years ago, in June 2011, at $1.368bn, forget the fact that the rupee has almost halved since then or three policies since 2009 have been released offering multiple incentives.
Perhaps a better measure would be to look at Pakistan’s manufacturing value-added (MVA) as a percentage of GDP, which came in at 11.55pc during 2020 and has been on a consistent downward trajectory since 2012. The performance was worse in terms of annualised growth as last recorded a decline of 5.55pc for MVA.
SDG-9 also talks about promoting access to financial services and credit for small-scale industrial enterprises. This is yet another area where we fare rather poorly, as evidenced by the State Bank of Pakistan (SBP) data which shows the total outstanding small and medium enterprises (SME) financing as of June end at Rs437.57 billion, making up a mere 6.26 per cent of the total private sector credit, and declining on a quarterly basis. The number of SME borrowers fell to 172,893, worsening both quarter-on-quarter and year-on-year.
None of it is obviously a surprise to anyone who happens to read the news every morning as we are used to the boom and bust cycle which takes one step forward and two backward. All of that is best reflected these days as after a short bout of unsustainable elite-focused growth, thanks to concessionary loans and incentives to some of the usual lobbies, the government and SBP are retracting some of the more expansionary measures.
Meanwhile, the common man continues to bear the brunt of high inflation which is only worsening with rupee depreciation and international commodity surge. It’s only a matter of time that career diplomats in 2030 come up with some other rebranded version of SDGs, which both Pakistan and the world at large will probably yet again fail to achieve.
Published in Dawn, The Business and Finance Weekly, September 27th, 2021