The Ministry of Industries and Production (MoI&P) is expected to submit the draft of the country's first 'national industrial policy, to the Federal Cabinet for approval in the first week of May 2011, sources said. The President of Islamabad Chamber of Commerce and Industries also confirmed to this scribe that the business community has been assured that the new industrial policy would be made public in May.
According to the policy draft, the over-arching objective would be to improve per worker manufacturing output from 1.5 percent per year (stagnant since the past ten years) to 100 percent in the next 10 years. The draft acknowledges that more than one-third of Pakistan's labour force is unemployed, or under-employed. In addition to this, about two million people join the labour force every year which, the government argues, would expand Pakistan's manufacturing base. By imparting skill-based training to the labour force the policy would focus on productively employing the young population of the country.
The policy draft also suggests measures to boost the manufacturing share in GDP to at least 30 percent in the next 20 years as envisioned in 'Vision 2030'. The policy suggests that areas where there is heavy presence of industry, both large-scale and SMEs, should be given the status of industrial corridors. These corridors must be provided separate feeders, where load shedding would only occur when absolutely necessary. Load shedding schedules for such units would be announced at least two months in advance and load shedding days would be clustered for both electricity and gas. No such priority would be given to industry that is based in residential areas, the draft policy says.
The draft of policy admits that ongoing energy crisis has crippled Pakistan's industry and economy. A conservative estimate puts the loss to industry at 1 percent of total manufacturing sales or nearly Rs 130 billion per annum. The energy crisis is hitting the industry at multiple levels: energy tariff increases are forcing businesses with low margins and those unable to generate their own power (eg SMEs) to close down; unannounced load-shedding and voltage fluctuations damage machinery worth millions of dollars; and unavailability of electricity lowers productivity of the workforce.
The draft claims that losses of Pakistan Steel Mills have been reduced by 50 percent whereas over 4000 contractual employees of PSM have been regularised. Over 800 employees who were suspended in 1996 were re-inducted in Utility Stores Corporation. Despite heavy induction the USC earned a profit of Rs 3 billion during last three years. The government has given a subsidy of Rs 500 million to consumers on kitchen items through utility stores.
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