KARACHI slipped to 175th from 170th position on the quality of life index over the last year. Its advantage to attract business for being the least expensive global city must have been neutralised with its slide on the quality scale. The corporate Pakistan and researchers hold divergent views over the authenticity of the survey findings and its business implications.
Karachi was tipped to be doing remarkably well on the cost of living index but it offered disappointingly low quality of life to its inhabitants as indicated by the index. The ranking on the cost of living index is based on cost of food, clothing, transport and shelter etc. The ranking on the quality of life index is determined by assessing both tangible and intangible requirements of modern day decent living such as security, quality of health and education facilities, ease of living, provision of utilities, state of environment, situation of freedoms, etc.
"Concerns regarding the quality of life are addressed in societies that value human life. Here life is lost at a drop of a hat. It seems to be the cheapest of all commodities available in inexpensive Karachi. Just a month ago on May 12 around 50 people lost their lives and last week over 200 lives ended abruptly for reasons that could have been avoided", said Tanvir Ahmed Sheikh, President of the Federation of Pakistan Chamber of Commerce and Industry (FPCCI) from Multan over telephone. "I have travelled extensively, nowhere in the world is the loss of a human life treated so casually. There is reluctance on the part of expatriates to visit Karachi. It does add to the cost of doing business in the city as one has to travel to more acceptable locations to meet trading partners", he said.
Many executives of MNCs and joint business forums approached to solicit their views were away on vacations. Some leaders contacted by Dawn contested the results of a Geneva-based human resource consultancy firm Mercer study while others blamed perception more than reality for Karachi's poor image abroad and for its low ranking on the index of quality of life. Most, however, agreed that for business executives and trade partners the quality and not the cost of living is the deciding factor in choosing the next overseas destination.
Of 143 cities surveyed, Karachi was found to be comparatively cheaper than all but Asuncion in Paraguay. Sadly, it was ranked 175th in 2007 amongst 215 leading cities compared to assess the quality of life they offer. In 2006 Karachi was placed at 170th position.
Mercer, which provides advice to multinational companies on international appointments, released these results of its annual study based on very extensive surveys of major cities around the world. The cultural centre of Switzerland Zurich topped the list of the world most liveable cities. "It has the highest quality of life among 125 cities ranked", says the study. Baghdad, understandably, was at the bottom at 215th. London was placed at 39th position and New York 47th. Karachi was not only behind other cites in South Asia it was placed 11 places behind Lahore that was ranked 163 and 18 ranks lower than Islamabad at 158th position. Beaten by Karachi on cost of living index, Delhi, Mumbai, Bangalore, Dhaka, Colombo all fared comparatively better on the quality of life index.
The ranking is said to be based on detailed assessments and evaluations of 39 key quality of life determinants grouped in following categories: Political and social environment (political stability, crime, law enforcement, etc); economic environment (currency exchange regulations, banking services, etc); socio-cultural environment (censorship, limitations on personal freedom, etc); health and sanitation (medical supplies and services, infectious diseases, sewage, waste disposal, air pollution, etc); schools and education (standard and availability of international schools, etc); public services and transportation (electricity, water, public transport, traffic congestion, etc); recreation (restaurants, theatres, cinemas, sports and leisure, etc); consumer goods (availability of food/daily consumption items, cars, etc); housing (housing, household appliances, furniture, maintenance services, etc); Natural environment (climate, record of natural disasters). Cities are ranked against New York as the base city which has an index score of 100.
Iqbal Bengali, President of the American Business Council, gave a measured response. He expressed his doubts over Karachi's placement as second cheapest city in the world. "Mercer is a well reputed firm but I need to look at their methodology of calculating cost of living and compiling of the relevant data. On the face of it there seems to be some mistake somewhere as city is not that inexpensive'', he said. He was optimistic over the business prospects in Karachi despite all the shortcomings.
Mustafa Kamal, Mayor of Karachi, felt that results of the quality of life index were not reflective of development work that was carried out during his mayorship over the last two years. "We have installed water and sewer infrastructure in Korangi Industrial area and many huge projects are in process in other three industrial zones of Karachi. The city government has signed agreements for $1.2 billion in foreign direct investment with multiple private investors. Things are moving in the right direction. Recently Asian Development Bank has given $800 million grant for our mega city projects. We need to portray the positive image of the city in media", he said on his return from aerial inspection of the city to assess the progress of damage control work underway after rains.
Saleem Reza, CEO of Pakistan Business Council, a forward looking think tank, felt that the cost of living in Karachi had risen steeply over the years. "It is true that most business executives can afford to lead a reasonably comfortable life but when you have to arrange for power and security privately it adds to your cost of living. Residential power bill of Rs50,000 for a single family is not cheap by any standard", he said.
He, however, felt that portrayal of the city is much worse than the reality. "Most foreign visitors are favourably surprised when they come to Karachi". As for appointment of fewer expatriates by multinationals he saw it as a welcome sign. "This is how it should be. It is an indication of availability of suitable local talent", he said. He also refuted the impression that foreign investor might be reluctant to enter Karachi. "There is scope for business which is drawing investors to the city despite risks".
Faisal Bari, an independent economist said that Karachi has become a scary place not only for foreigners but also for local non-Karachiite Pakistanis. "Somehow Karachiites have adapted to live with insecurities. More than anything my concern is the inability of the administration to deal with the issues that this city of 16 million people is faced with. Be it water shortages, power outages, traffic jams, cell phone snatching, bhatta (mandatory fund) collection or general security situation the administration looks totally inept", he said.
"Risk to life and property in Karachi are higher than most Karachiites acknowledge. They are in perpetual denial pretending to live a normal life. For those who successfully dodged mobile snatchers, bhatta (fund) collectors, suicide bombers, snipers, private torture camps operators and criminals and put up with prolonged power outages, water scarcity, traffic jams are crushed under roadside hoardings. It is depressingly gloomy with no light at the end of the tunnel. I am not surprised at all at its low ranking. Instead of pestering media for positive portrayal the administration should focus on improving the ground reality" said another senior businessman.
Chaudhry Saeed, a seasoned business leader, said that cost of travel insurance for Karachi is many times higher than that for other cities in the region. "You find out the difference in the rate of premium that insurance companies charge from foreigners wishing to travel to Karachi and it would demonstrate the quantum of perceived risk to foreigners in the city", he said from Islamabad.