Carefully treading the future and tapping potential
(Express Tribune (Pakistan) Via Acquire Media NewsEdge) With a population growth of 1.5% and GDP growth of barely 3% average of the last five years spells an approaching disaster for Pakistan. Increasing poverty, lack of jobs, and frustrated youth are likely to be the outcomes.
It is estimated that in the next 10 years, Pakistan will need to create a minimum of 36 million jobs just to absorb the annual workforce addition and this would only be possible if the country can more than double its GDP growth to a minimum of 7%.
Pakistan is fast running out of time and desperately needs something out of the ordinary to shake itself out of oblivion something that can have a direct and positive impact on our employment and economic growth. Pakistan needs to ideally focus on its immense indigenous human and natural resources. Although Pakistan has abundance of opportunities, these three areas stand out.
Agriculture makes up one-fifth of the country's GDP and when this sector does well, so do the industry and services sectors. Although the economy remains agriculture-based, Pakistan stands at 75th position among 105 in the food security index (2012).
Key symptoms include having yield per acre significantly lower in comparison to global averages across all major crops. With regards to milk production, Pakistan remains the fifth largest producer in the world but yield is the lowest among the larger milk-producing countries 22% versus European countries. In addition, nearly 40% of the fruits and vegetables go to waste as Pakistan does not possess proper packaging, canning or preservation technologies.
Fixing this issue is not rocket science as in specialised farms, yields matching global averages have been seen. The key is to expand this knowledge across small and large farmers. A disciplined effort can double if not triple the output along with providing a serious jump to the GDP growth rate and much-needed employment to millions.
Over the last decade, major reserves of minerals have been discovered in Pakistan and their sheer size has baffled economist and politicians. They include one of the world's largest copper reserve whose estimated value is $13 trillion as well as the second largest coal reserve in the world worth an additional $14 trillion (National Mining Policy).
In addition to these two major reserves, significant gold, zinc, lead and iron ore reserves are also present in the barren mountains worth trillions. Employment in mining, if we use estimates from other countries with similar resources, could provide jobs to nearly 2 million people if done properly with focus on local-value addition.
Information and Communication Technology (ICT)
Considering that we have missed both the agricultural revolution as well as the industrial revolution, our only savior is to take full advantage of the knowledge economy as it provides a unique opportunity to Pakistan. Barriers and cost of entry are lower compared to other sectors as the world is flat when it comes to the ICT sector.
Currently, internet penetration is 16% (around 30 million users) and by 2019 it is estimated Pakistan will have nearly 110 million 3/4G users. Winning in the ICT sector will require extensive investment in infrastructure, reliable broadband access as well as culture of innovation and entrepreneurship. In India, where their single-minded focus on expanding ICT in late 1990s resulted in a sector which today is worth $100 Billion and employs over 2.5 million people. Pakistan, if it executes a similar ICT strategy, can provide employment to 400,000 people by the end of this decade.
Carefully treading forward
Meanwhile, the key is the ever-increasing youth population 35% of Pakistan's population is below 35. This is bigger than the populations of France, United Kingdom and Italy. Youth is a two-edged sword. On the downside, if Pakistan does not jumpstart the economic growth engine, the youth will not have jobs. On the positive side, if we can empower this sizable population of vibrant and energetic youth, they will act as fuel for growth.
The write is associated with the corporate sector and a supporter of many social enterprises and foundations
Published in The Express Tribune, July 28th, 2014.
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