The 60s and 70s of the twentieth century were the times when western countries’ economies boomed and a large middle-class was created. However, over time, skilled labour became costly in these countries. To offset costs, eestern countries transferred low-skilled jobs to developing countries, which helped the economies of these countries boom through increased employment. By the end of the twentieth century, many developing countries were actively and aggressively exporting to the developed countries.

Moreover, with what started as doing low-skilled jobs, many developing countries, such as China, Malaysia and Singapore, moved to manufacture high value-added products and came to be known as Newly Industrialised Countries (NICs). These countries are now exporting to developing and western countries.

Pakistan also was part of the group which started exporting apparel and other low-cost products to the Western world. However, Pakistan never moved beyond manufacturing low-cost products which involves minimum technology. The technology and industrial policy of the Government of Pakistan (GoP) was, over the decades, never tailored for moving high-end products, and the main emphasis was to win waivers and exemptions for our limited export industry. Similarly, the policy for setting up industries locally by foreign investors in joint ventures with local industries was not focused on procuring and indigenisation of technology but more on the slogan of attracting Foreign Direct Investment. The result is that jobs meant for our workforce are being generated abroad; and we are paying for those jobs in foreign exchange which in turn affects our trade deficit, industrial productivity, and work-force employment.

Presently, there is a lot of discussion on what the government needs to do to create jobs in the country, and the indigenisation of various industrial sectors is one sure answer. However, per previous precedence, the focus is on promoting a few selected sectors such as textiles once again. Instead, the government of Pakistan should give tax breaks and incentives on local manufacturing and indigenisation, and take punitive action against those sectors which have not moved to local indigenisation. Furthermore, the government should identify and take steps against industrial sectors which are importing raw materials, which could be manufactured in Pakistan, given the right environment and policies.

We are a nation of more than twenty-two hundred million people, with sufficient middle-class which can make any industrial sector boom. It’s time that we look inward and manufacture for the local populace. This is never more valid than in the present COVID-19 crisis scenario when foreign markets are unpredictable and we have a high local unemployment rate. Therefore, the emphasis should be on tailoring industrial and technological policies which are not at the whims of international markets but focus on generating local jobs and increasing the local technological base in the country.

Ahsan Munir

The writer is a freelance columnist.