THE ECONOMY OF MODERN SINDH Opportunities Lost and Lessons for the Future This book is dedicated ro the poor households of Sindh who deserve a better future. THE ECONOMY OF MODERN SINDH Opportunities Lost and Lessons for the Future Ishrat Husain I Aijaz A. Qureshi I Nadeem Hussain OXFORD UNIVERSITY PRESS OXFORD Oxford Cni\'crsity Press is a department of the Lnin:rsi11 of Oxford. It furthers the Cni\·ersin:s objective of excellence in research, scholarship. and education bj· publishing worldwide. Oxford is a regisrered trade nurk of Oxford Cniwrsin Press in the CK and c·ertain in orher u>umric·s Published in Pakistan lw Oxford Cni\crsin- !'re" '.\:o. 58. Secror 5, Korangi lndusrrial :\rea, 1 PO Box 8214, Karachi-74900, l'cikisran Oxford University Pre" 20] ') © The moral rights of the author ,l'5erted have heel\ hrst Edition published in 20 l 'l All rights reser\'ed. 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I.rd., Karachi Acknowledgement' Author phorographs courtesy of Arif ,\khrnood Cover images: 'Blue Hour in Karachi City' lsrar/Shum:rsrock.com © 'Two women are working in field' SM Rafiq l'horography/Cerry Images © Contents Ack11ow!rdg,em1'11ts VII Acronyms and Abhrr11it1tio11s IX List of Tables xv List ofF igures XXll Preface xxv Introduction xxvii 1. Land and People Administrative and Economic History 2. n Population 3. 41 Education 4. 55 Health 5. 90 6. Labour and Employment 107 7. Poverty anJ Inequality Ul Agriculture 8. 163 Irrigation 9. 189 Infrastrucru re 1 0. 210 Sindh's Industrial Structure: Past and Present 11. 226 Energy and Mineral Resources 12. 257 Public Finance: Taxation and Resource Mobilisation 13. 2'J4 Conclusion .128 Annexures 3.D Ust ofA rmexure '!{1bles 335 List ofAnnexure Figures 339 Annexure li1b!cs 340 Annexure Figures 412 l\/otes 41 ') Bih!iograpf�y 440 lndex 457 //11' fi'rn1on11' o//vforlcm Sinr/i• j, ;1 detaialneddw ell-reseaormcmheentda ry on the c socirn'rnt1()mic issupens' c\'n;tin1 ithepr o\ince ofS indh It highlihgts thepr oblmes ' , \\hicli ha,h·:ci rnpetrhegldr' o wta1h1d conomicp oteinatolf thep rovin-rchce a.u thors e nfkr .1 comprd1cnsstiLvHcl 'g:1dyd rcs� thescheal lnges rc1 e , :\'; .1f orrnnC mTrnoro f the �t;HRcrn k ofP akiscanrnd presenAtdlvysie r to the Pr1rnL' .\ linisrcr ofP akisorn:! rnm tirutiRoenfaolra mnsd r\ustnivt.D rI shrHauts aiins, i llL'llfh q11iafilc d co-ah1m1 1l wh ook He.a lon\g\ 'ciot-ha mhoArijsaz, A . Qureshi crn to 1 . :11'\1:1ddc c·rn HllSsain�ihnootmhp arbalee xperotnst hseu bject-gainvi ensc isive c .1s:;ct, oqfrn:t hne \'aril'ornln!Som ic policpiuerss uehd;. t-heC overnmeonf tSi nclh. l-;s\11.1·ch"ri;ed q1u irreef ormsit knrificcl and: icldricnsa snic ndc lusmiavnen er. :lrl' UBI. i'p roud sharteh i\s' :1lhuo:o1khw kit h youa ndh opet hanto to nly wiltlh e ro h(lokp Ln parirn u nckrscmdtihn.eg__c ·o nomsiict uatiinSo inn dhhu ta lsinos pir us :1 e Ill k,1rn ,·,1llueasbsloc;n isnt da kalp'pr opriate measeu�rf ort hep rovinpcreo'psesr ous fut u l"L'. �L r.-;-�.· .. you first l "11it\)l,p'1kd l irnirc'd �l_ l�l ,1 i" .1 l�1rl'rti1n1r 1hrLh:.'cl1 ·kirn g: ;tnd tl11:11h.·ial \t'l"\"il-l'\ '-l''-·ror ofT\1ki.\fJP. ·\, ;1 pi·n�,r,l1·,."1 1i11d �n<1\i.1l1l,rii\re: :1ht, iln�1.1l,l1u 1, kr. 1kl'll lc,H-1 i!, hn,:nciin,Ldi u-..i,nid (cc1nnno tnic dl'Yclop111L'IH Acknowledgements T gi\'cs us immense pleasure thank our friends who enco 1raged us to >tudy Sindh's economy. A lot of very I rn : kind people have helped us write this book. are grateful to Fazalullah Qureshi who gave his time and We shared with us his immense knowledge ofSindh. We thank him for painstakingly questioning and challenging the data with his deep understanding and rich experience of dealing with official statistics. Dr Fateh Marri, former acting chief economist to the Government of Sindh, discussed and laid out the turf for writing. He has been very keenly interested in studying Sindh's true economic potential, and warmly supported the project from the very start. We would like to thank Arif Hasan for sharing his thoughts on Sindh's urban slums, and his Urban Resource Centre for their in-depth studies. We are deeply grateful to Dr Farrukh Iqbal, Executive Director of the Institute of Business Administration (!BA), Karachi, and Dr Qazi Masood, Director of the !BA Center for Business and Economic Research (CBER). for opening up the facilities of the Center during the conduct of this study. We are indebted to Abdul Lateef, a young civil servant and scholar, who thoroughly reviewed the manuscript. His suggestions helped improve the crms-refcrcncing of data tables and figures. He edited our redrawn tables us and advised on the infographic representation of hard facts. Without him, the readers might have had to plough through a lot more numbers. We thank Rahema Obaid, our research associate, for her infectious enthusiasm and faith in making a difference through the writing of this book. She worked diligently in reviewing the literature on Sindh's economic history and labour. Hazkeel Rizvi's consistent hard work needs be mentioned; his passion in aligning to different data sources and making them coherent was unprecedented. Shahecr Ahmed used his sharp eyes to ensure the authenticity of references and helped us prepare the bibliography. Agha Abdul Wahab supporred us by using online academic databases and other government publications. Many people were generous share their experiences. \'Ve thank Nawaz Leghari for tirelessly helping to with an in-depth inquiry on Sindh's public finances. Jdrees Raj put, Professor Noor Muhammad Memon, and Muhammad Umer Karim provided the latest information on Sindh's irrigation. We are grateful for the cooperation extended by the libraries of the State Bank of Pakistan (SBP), Applied Economics Research Centre (AERC), and Pakistan Bureau of Statistics (PBS) Karachi office. We thank Muhammad Anwar, Chief Librarian at the TBA Karachi, and his staff, especially Sadiqa Parveen, for making Pakistan's economic survey>, annual budget statements, and Sindh development statistics, from 1970 onwards, available at the Archives section of the IBA libraries. We also would like to thank 13a:;hir Ahmed Zia, Chief Librarian, State Bank of Pakistan, and Naeem Daudpota, Librarian, Sindh Archives, for their assistance. \Ve arc grateful to lmtiaz Ali and Amar Latif Qazi who went through the Dawn newspapers of around five decades to sift through and select some of the most significant economic developments in the province. Both of them also conducted a thorough review of tens of English, Urdu, and Sindhi newspapers and periodicals to help us understand the nature and trends of popular development discourse in Sindh. Vil \Ill \( 'k"< l\\'11 DCl:\ll-:'\ I'.' ( )m friend Qazi Zulqurnain ul l·-hq rcmairwd inv,iluahlc throughom the research process. \Ve highh­ apprL-ci;m· '.\adi;1 '.\.11i\\;1la, Farid :\ki. Sunui1·a Virjcc, and r\nam Ri11·i for sharing their comments on the draft ch.1prns: /i.1 1unn:r ,111d Hajll'a for helping wirh statistical sofrware: Zuhaib Shaikh for locating inrer-lihran­ \ li:u rcs<ll!l'Cl's: liha Baroni for doing the literature rc1·in1· on Sindh's indmtrics: and Ilsa Razzaq for initial proofing. I \Ve nwL· a grc.ir deal of debt to rhc 1·oung IBA undergraduate smdems 11·hn worked with us as research a"iisr;mts. \Vithom their support the LlSt amount of official data on 1·ariom aspects ofSindh's econom1· would nor have !wen possible to collate. Thc1· i11clud1· Bakhr:nvar '.\iaz, 'Lilheen >Jaqvi. \1lmtaf Cul, Ahsan Hamid, Scher Khan, Abdullah Hassan Yah;.·a, j;1isha Ahmed, Fatima Aizaz. 1\mcnah Sajid, Shumaila Abbasi, Sn·cla /ainch l'v1:1bti, Aan·ka brima, Ramsha Sajid. and lmr:m Nasir. The'\' proved w be critical pillars of support. \X'c ;ire dl'cplv gratdiil tn rhe Sindh Bmc:111 of Statistics for gencrousk supporting rhc study, especially the chairman l'Lrnning ,md Devclopmcnr (P&D) Ho;ml, \X:asccm Ahmed. whose pcrson,1l interest and drin: proved crnci.il in hringing rhis hook project to fruition. \r rh1· ()-.;ford l lnin'rsin- Press (OLTl 1':1kist:rn, \l'L' thank Ar�d1:id Saeed Husain, Rahccla Baqai, Sunara ':i1;l!11i. ;rnd ( ;Jwmia 1\li. Acronyms and Abbreviations ADP Annual Development Programme AERC Applied Economics Research Centre AIDS Acquired Immune Deficiency Syndrome AJK Azad Jammu and Kashmir AKHS,P Aga Khan Health Service, Pakistan AKU Aga Khan University ALP Alternative Learning Pathways APPM Accounting Policy and Procedural Methods AWBs Area Water Boards BHP Broken Hill Proprietary Company BHlJs Basic Health Units BOC Burma Oil Company BoR Board of R\'\'enue BPD Barrels per Day BPS Basic Pav Scale BTU British Thermal Unit CAGR Compound Annual Growth Rate CATI Civil Aviation Training Institute CBN Coq of Basic Needs CBT Competency Based Trainings CCI Council of Common Interest CETP Combined Effluent Treatment Plant CMEC China !vfachinery Engineering Corporation CMT Census of Manufacturing Industries CPEC China-Pakistan Economic Corridor CPPA Central Power Purchasing Agency CPPs Captive Power Producers DBCs Drainage Beneficiary Groups DWT Deadweight Tonne DALY Disease-Adjusted Life Year DHQs District Headquarters DISCOs Distribution Companies DPOD Dhoro Puran Outfall Drain ECCE Early Childhood Care and Education lX