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Industrial sector woes

Industrial sector woes

The industrial sector of the country accounts for about 24 of the gross domestic product and has been growing at a marginal rate of three percent for the last 70 years despite inconsistent government policies, energy crisis and liquidity crunch. Unfortunately, the thrust of the government always remained on the urbanized industrial base and rural areas, which have vast potentials of agro-based industries, have been neglected in every economic policy. According to recent reports, the manufacturing sector, which is mostly based in urban centers of the country,  has been declining, leading to a slash in the economic growth by 3.5 percent during the last six years. Irony is that the industrial sector only outperformed during dictatorship eras of Field Martial Ayub Khan from 1958 to 1968 and General Pervez Musharraf’s regime from 1999 to 2009. The industry recorded a two-digit growth in Ayub era and over seven percent in Musharraf government.

Pakistan is one of the highest urban-populated countries in the world and lack of economic activities in rural areas led to influx of population to the urban centers. The urban areas have a share of about 39 percent in the population of the country and the number is growing, putting more pressure on cities. There is no match of per capital income between the residents of rural and urban areas. The urban economy is still growing but slow industrial output can put the entire economic gains in jeopardy. Setting up industries is the basic requirement in cotton producing and citrus fruit grow areas. However, decline in the development rate in cities should be a cause of concern for the policymakers. The government should have to concentrate not only on the development of large scale manufacturing units, but also small medium enterprises which are most situated in the mixed urban-rural areas. This will be only made possible when incessant electricity supply is ensured and tax relief is given to the genuine investors.

Setting aside the political differences, all the political forces should concentrate on economy and not the real politick. The world is heading fast on the road of economic development and those countries which were facing recession in recent years are also recovering from crisis, but directionless policies are leading the people of this country to nowhere. This is time many countries are taking interest in investing in Pakistan. There is a need to facilitate foreign and local investors by providing them infrastructure to set up industries and tax relief. The procedure of doing business should also be simplified to encourage investment, especially in industrial sectors.