This refers to the article, ‘Deindustrialisation’ (Sep 10), by Dr Farrukh Saleem. It is a well-written article that talks about the downward trend of the industrial and manufacturing sectors in Pakistan. The writer has also presented some critical factors that are responsible for this mess. These factors include high rate of tax on the industrial unit, the high rates of corporate taxation on the listed companies engaged in direct manufacturing, and steep and inflated rates of gas and electricity. Another factor contributing to this decline is the notion of the ‘casino economy’. Since the people have little or no propensity to save, therefore, investment in long-term industrial projects is stunted. Also, whatever spare cash is available it is easily used to either buy shares or to invest in real-estate businesses in order to make quick profits. This is the most dangerous factor because with manufacturing in decline, more and more products will continue to be imported, leading to both the lack of employment and current account imbalance.
With a current population of 207.77 million, deindustrialisation and a high rate of unemployment will inevitably fuel poverty, insecurity, corruption, terrorism and extremism in Pakistan. The writer also made an interesting point. He has written that the manufacturing base as a percentage of GDP actually grew when the country was ruled by dictators. So we have observed that under civilian governments, the process of deindustrialisation has actually gained pace. The abovementioned factors should be looked into and a plan should be chalked out to improve the manufacturing and industrial sectors of the country.
Abbas R Siddiqi