Is Karachi's Neglect Hindering Pakistan's Economic Growth?
Synopsis
Key Takeaways
New Delhi, Jan 1 (NationPress) The ongoing neglect of Karachi, a crucial city that handles 76 percent of Pakistan’s trade, is viewed as a significant reason for the stagnation in the country's economic growth, which has dwindled to below 3 percent.
As reported by Dawn, without resolving Karachi’s pressing water shortage and other infrastructural concerns, Pakistan is unlikely to meet its growth objectives.
The piece, authored by Mohammad Younus Dagha, a former Federal Secretary, highlights that Karachi has lost out on its fair share of over Rs 3 trillion since 2010. Had this amount been allocated effectively, the city would not be facing such dire circumstances.
“With the ongoing neglect towards Karachi, Pakistan has been trapped in a low growth cycle since 2010. The Prime Minister’s Economic Transformation Agenda aims for a growth target of 6 percent, yet only 2.7 percent was achieved in the first year. Pakistan will remain in this low-growth predicament unless it enhances the infrastructure of Karachi, which is vital, contributing 50 percent of national exports and managing 76 percent of the trade,” the article mentions.
Additionally, Karachi is grappling with a severe water crisis.
The city requires between 1,200-1,300 MGD (million gallons per day) of water but only receives around 550 MGD from Keenjhar Lake and 100 MGD from Hub Dam. Alarmingly, a significant portion of this water is distributed via tankers. The estimated shortfall is 650 MGD, or nearly 50 percent of the city's total needs.
“Agricultural landowners, using 95 percent of Sindh's water resources, pay merely 20 paisas for 1,000 gallons of water, whereas Karachi residents are charged Rs 1,000 for the same amount,” the article reveals.
Moreover, the provincial government has been reluctant to allocate additional water to Karachi from Sindh’s share as per the Indus Water Accord. The state government has sought a separate allocation from the Indus River System Authority (IRSA) for increased supply.
However, IRSA has reminded Sindh that the IWA specifies that its allocation includes water for both urban and industrial uses in Karachi, which should be prioritized.
The article notes that Karachi contributes 90 percent of Sindh's taxes and 60 percent of federal taxes, yet has not received its due share of over Rs 3 trillion from the Sindh government since 2010.
Despite the IWA allowing preferential treatment for Karachi’s water requirements, the Sindh government fails to comply, even if it impacts only a minor fraction of the province’s water resources.