Impact of Karachi blast on economy

IT was again Karachi, the countrys biggest commercial and economic hub, that suffered its worst economic destruction after former PM Benazir Bhuttos assassination inferno as around 2000 shops of wholesale medicine and plastic markets were set on fire last week after a suicide attack on the Ashura procession on M A Jinnah, Road. The initial estimates showed that assets of traders worth around Rs30 billion were reduced to ashes. Just two years back when Benazir Bhutto was assassinated, the country witnessed such inferno that gutted billions of rupees. People of Sindh were so furious that they set each thing on fire. Only Pakistan Railways suffered losses of Rs 12.3 billion as a direct result of riots following the assassination when over 63 railway stations, 149 bogies and 29 locomotives were damaged within two days of after Benazir Bhuttos assassination. Following a three-day shut-down after her murder, the benchmark KSE 100-index fell 4.7 percent. The rupee fell to its lowest level against the US dollar since October 2001. It is said that within first four days after the assassination, Karachi suffered losses of $1b. A number of similar kind of blasts had also occurred across the country in past but nowhere the property or business centres were attacked. The scene on M A Jinnah Road and around Boultan Market looked like a war zone where buildings and vehicles were burning as a result of arsenal attacks. Not only shops were gutted in the blaze but after effects of fire also cost the country billions of rupees like suspension of goods transportation in just six days caused at least Rs2 billion losses to the transporters and created a significant gap between supply and demand of edible commodities upcountry. It was predicted that the prices of various daily-use item including medicines, plastic and used clothes could spiral 15 to 30 percent in the coming months due to the vast gap between the supply and demand across the country. A political leader was of the view that bomb blast was a conspiracy to defame Pakistan in the world and to stop the foreign investment in the country. Being the economical hub of the country, insecure Karachi could shake the confidence of foreign investors in Pakistan. At a time when country is struggling to revive its commerce and business activities after globally economic meltdown, the traders of Karachi are losing their confidence who suffered immense loss which cannot be compensated in terms of money. Despite appeals made by the religious and political leaders at that occasion, advising the people to calm down, mayhem remained continue for hours while the burning of countrys largest wholesale markets, in retaliation to the blast, has caused a loss billions of rupees. The same set up of these business entities would require months to establish at the same level and recover from the losses. Though, the exact figure of losses would be estimated after a comprehensive survey, the traders are claiming that they have suffered over Rs30 billion losses because of torching of about 3,000 shops. Though Prime Minister has sanctioned Rs1b on account of compensation to the affected shopkeepers on the demand of Federal Minister Dr Farooq Sattar and Babar Ghauri, but it is the need of the hour and moral duty of President Asif Ali Zardari that he should also announce compensation for the affected trades and common people of Ashura incident. It is an open secret that people of Karachi are more hyper compared to others dwellers as they set on fire every vehicle at the spot which met an accident. It is now the responsibility of the religious, political and social leaders to preach and advocate the people to remain quiet, calm and create harmony amongst their ranks when there was an incident like that take place. There is no precedent across the country except Karachi that billions of rupees of government and private sectors assets had been reduced to ashes just to show their anxiousness. It should also be kept in mind that the smooth business activities in the country would not only provide opportunities of jobs, maintenance of supply and demand phenomenon and progress of the country but also generate huge amounts for govt exchequer in terms of various taxes. (The writer is former Chairman PPA)