The time for formulation of Provincial Growth Strategies (PGS) has come.
These strategies should form the basis for the allocation among sectors of
the funds in the respective Annual Development Programs (ADPs). This role
of the Provinces in promoting the growth of their respective economies
has been greatly facilitated by the passage of the 18th Amendment.
This Amendment has led to the abolition of the Concurrent List in the
Constitution and the resultant transfer of the large number of functions in
this List to the Provinces.
Unfortunately, not much is known currently about the size, composition
and growth of the Provincial economies. Pakistan, unlike India, does not
have a tradition of constructing and maintaining Regional Income Accounts
so as to estimate and derive the trends in the Provincial Gross Domestic
Products (PGDPs). This has rendered it extremely difficult to engage in
meaningful planning at the Provincial level.
The Pakistan Bureau of Statistics (PBS), in coordination with the Provincial
Bureaus of Statistics, should have undertaken the task of distributing the
national GDP into the PGDPs on the basis of allocators for each sector.
This has not happened because planning has been very much in the
Federal domain under the Planning Commission, Government of Pakistan.
The approach now required is a ‘bottom-up’ process whereby Provincial
development plans are first prepared and then aggregated into the National
Plan. The task for the Federal Planning Commission is to ensure that there
is a consistent sectoral and macroeconomic framework to support the
Provincial and Federal plans.
The objective of this report is to present estimates by sector of the PGDPs
for the period, 1999-2000 to 2014-15. In the process, there is substantial
deepening of the knowledge on the economy of Pakistan, especially in
terms of the location of different activitiesThe report is organized as follows: Section 2 describes the methodology
used for constructing the regional income accounts to yield estimate of
the PGDPs. Sections 3 and 4 presents the results of the application of
the methodology and conclusions derived regarding the relative size,
composition and growth of the four Provincial economies. Section 5
quotes or constructs other indicators of regional growth to judge the
consistency of the PGDP estimates. Section 6 asks the question as to
whether regional inequality has been increasing or decreasing in Pakistan
over the last fifteen years? Section 7 identifies the sub-sectors which can
act as potential drivers of growth in each Province. Finally, in Section 8 are
presented a summary of the major findings and recommendations.