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Poor performance of transport sector costing Pakistan 5% of GDP

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*Railway enduring worst crisis mainly due to locomotive shortages

The World Bank estimates that poor performance of the transport sector is costing Pakistan about five percent of its GDP. Furthermore thirty percent of agriculture output is currently wasted due to its inefficient farm to market channels, lack of cold storage facilities and an obsolete underpowered trucking fleet, says Pakistan Economic Survey 2013-14. According to the survey, Pakistan Railway is enduring the worst crisis mainly due to locomotive shortages. Passenger and freight services substantially declined during last five years. This is evident from above table that gross earning of Pakistan Railway has declined during last five years. Due to over aged infrastructure and rolling stock, increase in fuel prices (high speed diesel), escalation of dollar exchange rate and a subsidized railway fare led to an increase in expenditure for sustained train operations. With capping of over draft by government of Pakistan in 2007, the finances required for increased maintenance cost could not be borne by the Pakistan Railway. Finally, sharp increase in salaries and pension led to diversion of all the revenue earnings to this obligatory payment at the cost of operational and maintenance requirements. Finance Division has committed to bear the expenses of salaries and pension thereon along with its impact of increase in future till that crisis is over. Government of Pakistan has allocated 39.366 billion in PSPD for the financial year 2014-15 for the development projects of Pakistan Railway. Pakistan International Air Lines Pakistan International Airlines Corporation (PIAC) faced various challenges during the year 2013 and this has been another difficult year for the PIAC.The challenges faced like; ever increasing competition in the aviation market, fleet constraints along with the operational issues of the Corporation coupled with economic challenges facing the country and prevailing law & order situation. Despite these circumstances, the Airline has been involved in taking various steps to reduce costs and improve productivity. Port Qasim Authority was established in 1973 as a second deep sea port of Pakistan. Port Qasim caters around 40 percent of sea borne trade of the country. Port Qasim handled 18.971 million tonnes of total cargo during July-March 2013-14 which is 2.2 percent higher than the same period of last year. Volume of import cargo during July-March 2013-14 stood at 13.084 million tonnes. Government of Pakistan is committed to develop and enhance a modernize transport and logistics sector. Vision 2025 also seeks to establish an efficient and integrated transport system that will facilitate the development of our economy. The targets set forth are to ensure reduction in transport cost, safety, effective connectivity between rural areas and urban areas markets inter-provincial high speed connectivity, integrated roads network and transportation corridor connectivity with major regional trade partner countries. Topography of the region consists upon hilly mountain areas, far flung agriculture lands and the productive resources scattered all over the country. Roads provide easy and efficient means of transportation. About 61.4 percent of our population lives in villages.Roads network in Pakistan is of crucial importance for the movement of people and goods, integrating the country, facilitating economic growth and in reducing poverty. Total roads network in Pakistan is around 263,775km out of which about 70 percent are paved. Road density in Pakistan is 0.32 km/km 2 which is low in comparison of neighbouring countries. This roads network carries over 96 percent of inland freight and 92 percent of passenger traffic and are undoubtedly the backbone of the economy. Table 13.1 shows the details of roads in Pakistan. National Highways consists of 9,324 kms (3.53 percent) and Motorways 2,280 kms (0.87 percent). Strategic roads and Expressways contribute 262 kms and 100 kms respectively that is 0.1 percent. Rest of the roads network contains provincial highways and roads under respective local administration like; Cantonment Boards, Municipal Corporations, Local Development Authorities, etc. About 40.9 percent of total roads lie in province of Punjab, followed by 30.9 percent in Sindh, 16.3 percent in Khyber Pakhtunkhwa and 11.3 percent in Balochistan. Azad Jammu & Kashmir, being mostly hilly area, shows a small proportion of just 0.6 percent, of roads network. National Highway Authority (NHA) is rendering a vital contribution in improving the quality of roads network to bring about qualitative improvement in standard of living. Pakistan is geographically bisected into two halves by River Indus. Eastern segment is historically well developed. To bring the Western segment at par with the Eastern half, NHA is improving East West connectivity through construction of numerous bridges across the river Indus in addition to investing more and paying extra attention towards the development of west. Present NHA network comprises of 39 national highways, motorways, expressway, and strategic roads. Length of this network is 12,131 kms. NHA existing portfolio consis ts of 83 development projects costing Rs.615.2 million. GoP allocated Rs.63.04 billion in PSDP 2013-14 for development projects of NHA. This amount includes Rs.30.92 billion foreign currency and Rs.32.12 billion in local currency. Infrastructure is both a cause and a consequence of economic growth, that is investment in infrastructure construction fosters the economic activities consequently on completion by using the infrastructure facilities provides means of economic progress of the country. Integrating development of the country with the global economies is only possible by providing transport and telecommunication services throughout the country. Developed infrastructure can also raise the quality of human capital, which is a key factor in achieving high and sustainable levels of growth. Improvements in the quality and quantity of infrastructure have a positive impact on the poor and thus play a vital role in reducing income inequality. PPI

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