Addressing urban, rural income gap
THE additional resource transfers to the federating units as a result of the 7th National Finance Commission Award, has provoked a general scepticism among academics and economists about the absorption capacity of the provinces for funds.
And the fear that additional resources could turn the provinces fiscally irresponsible has been a hallmark of such policy discourse.
Perhaps taking these debates as genuine concerns, Dr Kaiser Bengali, former adviser to Sindh Chief Minister on planning and development, proposed dedication of additional resources to integrate rural and urban Sindh for minimising huge income and lifestyle gaps.
Although, he quit as adviser due to interference from political powers at the centre, his policy framework on developing cities and towns provides at least a starting point perhaps not only for Sindh but also for other provinces to think on fresh lines.
The decades-old neglect that Mr Bengali points out could well be explained from an urban profile of Sindh cities that attract migrants virtually to Karachi alone. Numbers provide a fascinating picture.
“Karachi and Hyderabad have population of over 15 million and three million, respectively. However, the third largest city – Sukkur – has a population of just 300,000, which is a mere two per cent of the population of Karachi and 11 per cent of the population of Hyderabad. Three cities – Larkana, Nawabshah and Mirpurkhas – have a population above 200,000 and six cities – Jacobabad, Shikarpur, Khairpur, Dadu, Tando Adam and Tando Allahyar – have a population just above 100,000.”
“ The combined population of these 10 smaller cities equals 1.7 million, which is less than 12 per cent of the population of Karachi and less than half the population of Hyderabad”.
He argues that Sindh is resource rich, commanding between 70 to 99 per cent of gas, oil and coal output/reserves of the country that could be described as the natural resource OPEC of Pakistan. It has a rich agriculture and a large industrial, commercial and financial base and its two ports serve almost the entire hinterland of Pakistan.
Sindh has, however, developed as a dual economy: a vibrant urban industrial, commercial and financial base in the port city of Karachi and an under-developed agricultural economy in the rest of the province. How to integrate the provincial economy so as to develop the entire province and minimise the regional income gap is a key development challenge.
Reducing the regional income gap is one component of the objective. The other equally important part is to reduce the personal income gap. This can be achieved by raising economic activity to a level where every able bodied person is able to obtain gainful employment at an income that is sufficient to acquire at least the basic necessities of life: food, clothing, shelter, education and health care. Given the rather poor status of women in terms of human development and empowerment, the development strategy needs to be gender-sensitive as well.
Given Sindh’s resources, it is possible to ensure that no resident of the province – woman, man or child – goes hungry or suffers from malnutrition or does not possess reasonable shelter or cannot access medical care while no child is deprived of the best of education. These are objectives that are achievable in the time span of one generation. Rather, the objectives of eliminating hunger, halving malnutrition, and doubling the girl and boy child enrolment rate are achievable by the target date of 2015.
Sindh faces a number of challenges. These include the challenges of dual economy, poverty, unemployment, poor human capital, deteriorating water infrastructure, energy crises, and general lack of infrastructure including poor road communication. Poverty and unemployment is pervasive in Sindh generally and in rural Sindh particularly. Over 60 per cent of manufacturing units and employment is concentrated in Karachi, with very limited income earning opportunities and jobs in rest of the province.
Dr Bengali has proposed to change the traditional project-based development planning in which schemes are identified individually and included in the Annual Development Plan. He, however, argues that development is a dynamic transformative process of inter-connected economic and social variables and requires a planned approach. Projects are components of the Plan and impact each other and the Plan takes account of the inter-sectoral and inter-project impacts. Planned development attempts to create synergies between various projects in order to maximise aggregate benefits.
The present ineffective scheme-by-scheme approach should give way to a coordinated and planned approach. The proposed development approach approximates a combination of the ‘Big Push’ and ‘Unbalanced Growth’ development theories with a concentration of resources in designated Priority Sectors and in designated regional growth nodes.
Concentrated investment in these sectors would constitute the ‘Big Push’. At the same time, deliberate disproportionately high level of investment in these sectors constitutes ‘Unbalanced Growth’. The ‘Big Push’ is expected to create a large component of economic assets, but will create an inter-sectoral imbalance. The combined effect of the two is expected to create a ‘pull effect’ for other sectors of the economy. The investments in the priority sectors are likely to act as triggers for development in the economy as a whole.
In his opinion the NFC Award 2010 is a landmark achievement and accrues additional resources for Sindh, which needs to be devoted to creation of economic assets that can provide a large flow of income for future years. Available resources need to be concentrated sectorally and regionally in selected high-value large-multiplier projects in critical priority sectors, with a view to lift the Sindh economy onto a higher plane of a modern 21st century economy.
His development strategy proposes four areas of intervention for development of urban growth centers, connectivity between growth centres, satellite towns and housing and coastal areas.
He argued that while Karachi had concentration of economic activities but poor access deprived large populations of Sindh from benefiting economic activities. While Karachi would remain so, regional sub-centers and regional hubs acting as growth nodes should be developed to integrated development of fewer strategically located schemes at urban centres. In this context, Sukkur in the north, Nawabshah-Dadu in the centre and Hyderabad in the South need to be identified as regional growth centres and upgraded and prioritised for allocation of development funds.
For regional growth and connectivity, the plan proposed development of about 1600 kilometres of major roads in the dual carriage ways in a period of 10 years. This is important in view of the fact that by international standards, there should be one kilometer of road for every one square km of areas. In Sindh, road density is a meagure 0.278 kilometer per sq. km.
The economic benefits associated with road network could not be over-emphasised that include employment, enhanced access to markets for farm produce, viability of industries, reliability, time savings, safety, vehicle operating cost reduction and increase in productivity.
The real challenge is to transform improved visions and strategies into action for the larger good of the people.