Connectivity

Sustainable economic development, be it through enhanced productivity, better management of cities, integrated internal markets, inspiring youth or invigorating communities, they all depend on robust and adequate connectivity infrastructure. Connectivity, in our discussion, includes both the transport infrastructure and Information and Communication Technology (ICT).

Improvement in transport infrastructure creates new opportunities by linking domestic markets and reducing travel time. It reduces production and transactions costs in poor regions which serve as a stimulus for domestic commerce.

Pakistan carries a score of 1.53 out of 10 in useful ICT related connectivity . This is the lowest in a group of 25 resource driven economies. Useful connectivity highlights the importance of the physical infrastructure with reference to economic growth by looking at who is using it (businesses or consumers) and how well it is being used.

Similarly, poor performance of transport sector is estimated to cost the national economy 4 to 6 percent of GDP every year . More than 30 percent of agricultural output is currently wasted due to inefficient farm to market channels, lack of cold storage facilities and obsolete and underpowered trucking fleet. Furthermore low ICT penetration in rural areas slows down the information sharing process.

Local markets are also not fully integrated. With truck operating speeds on main corridors only half of the truck speeds in Europe and productivity of Pakistan Railway’s freight services only 1/8th and 1/3rd of China’s and India’s respectively, it not only takes longer but also costs more leading to significant price differentials in different markets . Lack of useful connectivity also increases the risk of getting into joint ventures for businessmen of different areas. This discourages innovation by forcing people to stick to their traditional ways of doing business.

Low level of broadband penetration is also denying access to modern ways of networking to the youth. Connectivity between universities and industry is also very low in Pakistan. Due to this weak nexus, youth is already exposed to a high risk of not acquiring appropriate skills for future jobs.

For proposed reforms please go through the draft connectivity chapter in the 'Publications' section.