Importance of Karachi and Karachiites for Pakistan

[My-Analogous]

its a legal crime

I don't know shipping business from Karachi to Dubai is legal or illegal?. May be Ayyan Ali tell us more

 

[El Sidd]

I don't know shipping business from Karachi to Dubai is legal or illegal?. May be Ayyan Ali tell us more

well crime is financially traceable

 

[My-Analogous]

well crime is financially traceable

Are we getting our 200 billion dollar back in Pakistan?. if no, then what is the use of tracing?. we are not even making preventing measures

 

[shahbaz baig]

My famous hotspot, i am not even a karachite. Chaly ab tu business karay so we can end our circular debt.

Jab tak core issue per koe tawajja nhi dyta tuo circular debt khatm nhi hoga.

For me the main reason of circular debt are IPPs, unpaid bills of Govt & Govt subsidies which further coupled with transmission line losses.

I hope every Pakistani can easily understand what I mean.

Surplus electricity without any use but due to Govt agreement with IPPs, Govt is bound to pay them heavy amount even without generating electricity because Pakistan transmission lines can't tolerant the burden of whole electricity. I don't know why people there can't understand this simple logic.

Only one Solution:
Update & increase transmission lines accordingly to generated capacity & build new industrial SEZs and transfer that surplus electricity to industrial areas, As soon as possible. Then you would observe within 2 and 3 years there will be more then half reduction in circular debt.

 

[El Sidd]

Are we getting our 200 billion dollar back in Pakistan?. if no, then what is the use of tracing?. we are not even making preventing measures

that is a question for policymaking. both are more than enough if deteremination is shown to any of the two.

 

[My-Analogous]

that is a question for policymaking. both are more than enough if deteremination is shown to any of the two.

True

 

[Jial]

you are just salty that handsome people dont come to karachi.

jaltay raho

You are handsome, so now dont come to karachi.

 

[Wow]

i love the fact that the countries most biggest racially ethnically diverse city a city that has produce so many heroes and is the financial cultural capital of Pakistan has to defend it itself again and again and prove its patriotism while other provinces has full fledged independence movements and large ethnic based parties and not a peep

 

[El Sidd]

You are handsome, so now dont come to karachi.

rok Sakko rok lo

 

[Meengla]

I have a love-hate relationship with Karachi. Born and raised there. Seen it much cleaner, socially-liberal and safer in the 1970s to it's near-demise in the 1980s (thanks to MQM and the Afghan immigrants). After that, the WOT brought more disaster, ably helped by the ethnic stupidities of ANP, MQM, and PPP. It took a neutral PMLN govt to finally do a genuine crackdown and restore the peace. We should never forget that Nawaz Sharif, despite all the blame and faults, was the architect of Karachi's current peace.

It's a dusty, dirty, over-crowded place but full of charity and acceptance of all people who migrate to the city. A typical port city is usually like that: Liberal, vibrant, fast paced, accepting of others.

Also, let's be very clear: The immigrants from India played a very crucial role for the fledgling country of Pakistan. There are no two opinions about that. The immigrants were not all some 'Bhookey Nangey' as some stupid racist in this forum would like you to believe. Even when they were poor, they had the education--something lacking in most of the then residents of Pakistan. And when they were not poor, they had not only the money but the entrepreneur skills. They established businesses and employed everyone.

For the future: Karachi should be given resources. The Waderas of interior Sindh, by nature, is anti-progress and is stagnant. Nothing good could be expected from them. Also, Pakistan needs to really bring up Peshawar and Quetta on urgent basis.

 

[CHACHA"G"]

Seeing is believing: Watch the video..

Economy of Karachi:
The city of Karachi is well-known to the world as the commercial and financial capital of Pakistan. The Karachi generates about 25% of the national GDP. It also has its share of 65% in generating the national revenue that includes federal and provincial taxes, customs and surcharges. In 2007, Karachi was identified as the most business-friendly city in Pakistan by World Bank.


The city has a very large and diverse economy. It is home for some of the largest and most dynamic industrial complexes in the country such as Sindh Industrial & Trading Estate (SITE), Korangi Industrial & Trade Estate, FB Area, North Karachi Industrial & Trade Estate, Dhabeji and Port Qasim etc. SITE Manghopir is the largest industrial park of the country comprising about 4000 factories. The areas like I.I. Chundrigar Road, Sharah-e-Faisal, Clifton and Defense are the main business hub of Karachi.


As the city offers an ideal location for the business, the industries produce a wide variety of goods, from textiles to chemicals, steel and machinery. The versatile industries of the city also produce cement, corn mills, shipbuilding, refined oil, shoes and food. Some major automobile manufacturing companies such as Toyota, Suzuki, Millat Tractors, Adam motors, HinoPak have their manufacturing plants in the city. The city is also home for plenty of cottage industries.


Most of Pakistan's public and private banks, insurance companies have their head offices in Karachi. Many of Pakistan’s independent television and radio channels such as Geo, ARY, Hum and AAJ TV, KTN, Sindh TV are headquartered in Karachi. The city also offers the scope for expansion of tertiary sector and retail trade. The largest stock exchange of Pakistan is situated in Karachi. Jinnah International Airport situated in Karachi is the largest international airport in Pakistan.

The Karachi is a major sea transport centre and contains the country’s two major ports namely the port of Karachi and Port Mohammad Bin Qasim. The city is an important hub for fishery business in Pakistan. The major fish harbour in Karachi includes Karachi Fish Harbour and Korangi Fish Harbour. In Karachi, about 300,000 people are connected with the fishery business and some subsidiary industries provide employment to about 400,000 people.


Although IT industries, electronic media and call centers are playing a significant role in the current economy, the huge industrial base of the city provides the maximum strength to the economy of Pakistan.

 

[zulu]

@Meengla Totally agreed Sir but as another born,raised and still working there another Karachi wala just to clear few points
1)Karachi is less greener than any other city also very dirty these days but due to lack of support from Sindh govt who took control of all power but doing nothing .Kinda punishment giving PTI majority rather than them but its still old story of Karachi
2)We fought MQM from day one on same point and would do with other too as Karachi is mini PAkistan and its belong to every Pakistani.Sab aain sab kamain aur sath sath issay apna sher samjhy aur khiyaal rakhain

3)Those wadeeras are real curse they even destroyed their own places in interior SIndh.Ordinary Sindhi facing same in their hands like we do
4)OP credit not goes to PMLN not an single bit actually they resist very hard as was jeopardizing their agreement with PPP ""Punjab tumhara sindh hamara ""do whatever we will protect each other.Credit goes to Army alone thats why we consider Gen Raheel Sharif as our hero even architect of that operation was GEn RIzwan AKhtar and Police Ofiicer Shahid HAyat.Its was Rizwan Akhter who convinced Gen Raheel he was hesitatnt bcoz of NS pressure as never wanna create any political issue
About the life of Karachi u are so right its become addiction jo yahan reh ly. my friends who came here to work from Punjab and KPK its their observation aab khud unka dil nahi lagta apny elaqoo main ziyada aur unky bachy woh tu tayyar hi nahi hotay thats the beauty of Karachi even with all such troubles

 

[CHACHA"G"]

The importance of Karachi
Published: October 12, 2015

The claim that Karachi generates 65-70% of the revenue needs to be corrected. PHOTO: REUTERS

KARACHI:
Some debates continue forever with statistical evidence and philosophical arguments driving the dispute forward in perpetuity.

One of those is Karachi’s input to the country’s overall tax revenue. Even on its face, the need to isolate Karachi merits discussion. But that’s what people do when they come out with all guns blazing in hailing the metropolis as the saviour.

One might even concede to their overzealous nature. Karachi, the business hub and former capital, attracts millions to its workforce and generates a lot of economic activity. But is it true that it drives the entire country? Many claim that.




“It is quite irresponsible for you to state this … journalists don’t want to read, they say whatever they want. They need to be held accountable,” was a political economist’s comment to an article that claimed “Karachi generates 65% of Pakistan’s revenue, and if the metropo lis’ security situation improves, there can be better economic prospects for everyone”.

The statement, not driven by an academic study, was a mere repetition of the popular opinion.

PTI, MQM and PPP have all mentioned the populist view.

None of them have, however, mentioned the source of this figure nor has anyone felt the need to question this ‘sacred percentage’.

But exploring facts comes close to answering the question.

Revenue collected from the country includes three Large Tax Units (LTUs) in Karachi, Lahore and Islamabad, 18 Regional Tax Offices (RTOs), including Karachi RTO–I, II, III, Lahore, Peshawar, Rawalpindi and Quetta, among others. States earn their revenue mainly through direct, indirect taxes and income from public corporations.

Read: The irony: Cost to collect tax higher than tax collection

In Pakistan, provincial budgets and provision of public goods in the provinces are dependent on transfers by the federal government.

The provinces are also obliged to collect taxes, ie capital value tax on immoveable properties, property taxes, stamp duties, motor vehicle levies, land revenue and agriculture income tax, but their collection is minimal. Reports suggest provinces, overall, contribute about 7% of tax and 9% of non-tax revenues of the country.

While there is no scepticism on Karachi’s improving security situation favouring the economy, economists argue that rather than generation, the city ‘dominates’ the country’s revenue-collection statistics.

The distinguishing factor

Much of the country’s economic, manufacturing, services and other value addition takes place in Karachi.

But what is the difference between revenue generation and collection? According to an article by State Bank of Pakistan’s deputy governor Mohammad Ashraf Janjua, we should know two terms: impact and incidence. Those who pay tax, but pass on the final burden to others are bearing the impact of a tax, those who bear the final burden are bearing the ‘incidence’. Thus, if machinery is unloaded in Karachi (tax is paid here), but is being used in Punjab, the tax is collected from Sindh, but generated by Punjab.

“It has the advantage of being a port city, as well as housing head offices of major financial institutions,” economist Kaiser Bengali, who is also adviser to Balochistan chief minister, told The Express Tribune. “Most companies have their head offices in Karachi where they pay their income tax but earn their income from the entire country.”

Asim Bashir Khan, in Akbar Zaidi’s Issues in Pakistan’s Economy, says Karachi ranks on top on the basis of average overall tax collection between 2000 and 2012 — it has an average of 62.4% followed by Lahore 13.63%, Rawalpindi 8.33%, Multan at 5.50% and Peshawar at 3.3%.

The average of direct tax collection is almost the same, with Sindh being the highest with 64.97%, Punjab with 30.93%, Khyber Pakhtunkhwa with 3.24% and Balochistan with 0.86%. Karachi dominates with an average 61.49%, followed by Lahore, Rawalpindi, Multan and Peshawar with 17.33%, 4.30%, 3.65% and 3.03%, respectively.

Province-wise average revenue collection calculated by Asim Bashir Khan. DESIGN: NABEEL AHMED

Indirect tax collection statistics are also similar as direct taxes with Karachi dominating with an average 62.79%, followed by Lahore, Rawalpindi, Multan and Peshawar.

“On average, the two most developed provinces of Pakistan – Sindh and Punjab – make significant contributions; but this is strictly due to its monopoly over port resources, which facilitate superiority in collection of indirect taxes such as custom sales tax and FED on imports,” writes Khan. “Sindh’s share in collection of custom duty was 84.21%, followed by Punjab with 12.43%, K-P with 2.3%, and Balochistan with 1.05%.”

Read: Oversight committee formed to implement tax reforms

But does Karachi have an edge just because of revenue from customs or profits declared by financial institutions or the metropolis contribute to the national treasury in other ways too?

The indirect input

“Millions of migrants from other provinces flock to Karachi to earn their living. Billions are remitted to their families based outside Karachi. These remittances make the difference between a family’s survival and a life of despondency due to no earning opportunities available to the migrants in their localities or cities,” says former Karachi Chamber of Commerce and Industry president Majyd Aziz. “All this is tax-free for migrants, but these remittances spur up economic activity in areas outside Karachi.”

Aziz argues Karachi’s potential is way beyond the current oft-repeated figures.

“Goods destined for the northern areas traverse through Karachi’s roads and use other facilities and utilities. What if a substantial toll tax is levied on every truck moving out of Karachi? This would bring in billions to Karachi’s coffers, which could be spent on improving the physical infrastructure,” he says.

According to FBR data (as of December 9, 2014), 881,262 tax returns were filed across the country. Karachi leads this list as well — and by a wide margin.

Zaidi, in his book, says that in terms of direct taxes, Karachi contributes more than 35% of all of Pakistan’s taxes. Similarly, he adds, if one looks at the sales tax collected, which is consumption tax, it gives an indication of the nature of economic activity, and of the consumer market in Karachi as compared to the rest of Pakistan.

We can safely conclude the amount taxed through Karachi includes both collection and generation. Those referring to Karachi’s contribution, either in naivety or deliberately, refer to collection and they are right.

Karachi, the industrial hub, does contribute the most to tax collection. But the word should not be generate because, while it generates much, it collects far more than that.

The writer is a staff correspondent

Published in The Express Tribune, October 12th, 2015.

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https://tribune.com.pk/story/971188/the-importance-of-karachi/

 

[Meengla]

It is home for some of the largest and most dynamic industrial complexes in the country such as Sindh Industrial & Trading Estate (SITE)

My family textile mill still stands tall in SITE and my dad's hand-written signature on a concrete pillar is still there when he was a boy in 1951 during the foundation laying days of the mill. I have seen Pathans, Afghans, Gujraratis, Punjabis, Memons, and of course Urdu speaker and probably other ethnicities' workers employed there, all working together. No discrimination. Under ZAB workers' rights were introduced. AND there were/are literally dozens of similar textile businesses established by the extended clan in SITE and elsewhere. I am a living witness to that legacy. Imagine what a Sindhi Wadera would do? Open another Sugar Mill and treat his 'Mazara' with contempt?

The immigrants from India formed the backbone of the Pakistan movement and then formed the backbone of the new Pakistan.

4)OP credit not goes to PMLN not an single bit actually they resist very hard as was jeopardizing their agreement with PPP ""Punjab tumhara sindh hamara ""do whatever we will protect each other.Credit goes to Army alone thats why we consider Gen Raheel Sharif as our hero even architect of that operation was GEn RIzwan AKhtar and Police Ofiicer Shahid HAyat.Its was Rizwan Akhter who convinced Gen Raheel he was hesitatnt bcoz of NS pressure as never wanna create any political issue

Well, I beg to differ. I have no love for Nawaz Sharif but under repeated govts for years either the PPP, or the MQM or the ANP pressure groups ensured there would be no major operation in Karachi. Why? Because all these parties had their mafias in Karachi. Only PMLN had no such mafia and that's why the Army--which still needed the Federal approval and funding--Pakistan is not some Iraq under Saddam--launched the operation. But let's not quibble over this. A good deed done. Especially good is that that Haramkhor Altaf Hussein is a big loser in history's books.

 

[zulu]

@Meengla Sir i hope that factory is still running and giving employment to all.about second point as u said its done and dusted just arguments why waste on it.Better dreams and do effort to bring that glory back for sake of Pakistan and all Pakistanis