ISLAMABAD: With the Punjab government developing an economically sustainable industrial city in the proximity of M2 highway, a World Bank report has said that urbanisation provides Pakistan with the potential to transform its economy and to join the ranks of rich nations.

But the country, like others in South Asia, has so far struggled to make the most of that opportunity, says the report, “Leveraging Urbanisation in South Asia: Managing Spatial Transformation for Prosperity and Liveability”.

The report, released on Saturday, points out difficulties in dealing with pressures that enhanced urban population puts on infrastructure, basic services, land and housing. The environment has fostered what the report calls “messy and hidden” urbanisation in Pakistan and the region.

This, in turn, has helped to constrain the country’s full realisation of the prosperity and liveability benefits of urbanisation, it says.

Estimates indicate that cities generate up to 78 per cent of Pakistan’s GDP and the government’s ‘Vision 2025’ places a premium on urban job growth. Planning for urban growth can help create vibrant and productive cities that fuel the country’s growth, but that will require dealing with the problems posed by the country’s messy and hidden urbanisation.

Messy urbanisation in the country is reflected in the existence of low-density sprawl and the fact that cities are growing outwards beyond administrative boundaries, creating challenges for planning, transportation and provision of public services.

It is also reflected in the widespread existence of poverty and slums. In Pakistan in 2010, about one in eight urban dwellers lived below the national poverty line and an estimated 46.6 per cent of the urban population lived in slums.

Hidden urbanisation, the report says, stems from official statistics understating the share of people living in areas with urban traits. According to official data, 36 per cent of Pakistanis lived in urban settlements in 2010 but the World Bank estimates that the actual share of the population living in areas with urban characteristics may be as high as 55 per cent. Acknowledging the true extent of urban areas can help to facilitate better planning and metropolitan management.

Failure to address these problems can make cities less liveable. Pakistan faced an urban housing shortage of approximately 4.4 million units in 2010. The 2015 liveability index of the Economist Intelligence Unit ranked Karachi 135th among 140 cities. Dhaka was the only major city in South Asia with a lower ranking.

To better tap into the economic potential that urbanisation offers, the report says that policymakers should consider actions at two levels — the institutional level and the policy level. At the institutional level, the country will benefit from improvements in the ways in which towns and cities are governed and financed.

“Taking steps to help Pakistan’s cities to realise their potential is critical as the country’s urban population is expected to increase by approximately 40 million people to an estimated 118 million by 2030,” says Patchamuthu Ilangovan, World Bank Country Director for Pakistan.

Published in Dawn, December 6th, 2015