There is some real attention being paid to the economic development of Balochistan, especially after the political scandal that erupted during the time of the Mama Qadeer talks in Lahore and Karachi. The Parliament passed a resolution unanimously urging the federal government to provide jobs to unemployed engineers of Balochistan. Now there is talk of a “Balochistan package” for its economic uplift. In the latest budget, the federal government has announced a five-year income tax holiday on all new manufacturing units set up in KP between July 1 and June 30, 2018. The exports of perishable products, like fruits, vegetables, dairy products and meat shall be allowed against the rupee instead of the US dollar from next month. The Quetta Chamber of Commerce and Industry (QCCI) wants concessions for Balochistan on the same lines as KP. Last month MPA Hussan Bano tabled another resolution recommended the provincial government approach the federal government to introduce a package in Budget 2015-16 for provision of jobs to the unemployed engineers in order to remove the sense of deprivation among them. Lobbying for more investment and more economic protection for economic enterprise are on-going.

In this scenario there are two things to consider, one positive one negative. In economics, expectations can have a huge role in economic boom or recession. With the promises being made by the government about the Chinese Economic Corridor being a boon for the Balochi people, and the recent rise in political lobbying for economic development in the region, there is an expectation that the economy will improve in Balochistan. Positive expectations improve the business environment, decrease the perception of risk, and encourage investment. The Modi government did just this, created the perception of prosperity in India to attract investment and consumption.

On the other hand, the protection of nascent industries often leads to industries remaining dependant on government hand outs. An income tax holiday may encourage investment, but only cause unrest and loss once the holiday is over. This is why economics shies away from government interference; it inhibits healthy competition, creates favourites, and causes a depletion of public funds. A healthier interference could be to set up energy, transport, education and technology infrastructure.

This is a resource rich region and there will be no shortage of creativity once people are invested in, educated, and connected to markets. Many instruments are available to the government to encourage development, but economy policy needs to be well thought out, not politically motivated, and encouraging of competition and free private enterprise.