Hassan Farooq

20020225

Syed Muhammad Hasan

Spatial Inequality and Geographic Concentration of Manufacturing Industries in Pakistan

Dr Abid Burki

Agglomeration is a global phenomenon that explains the concentration of particular industries in a

region. While it is quite common in developed countries, it also explains industrial junctions in

developing countries. The paper at hand also seeks to explain this intriguing phenomenon and its author

Abid A. Burki henceforth strives to explain agglomeration of manufacturing industries in Pakistan. He

also looks at the spatial inequality in Pakistan by using empirical evidence and identifies the root causes

behind the concentration of industries in an area due to certain compelling factors. Here it is also

important to note that this paper provides a much-needed insight into agglomeration industries in

Pakistan which are crucial to industrial development in the country.

The data used by Dr. Abid was extracted from the Census of manufacturing industries (CMI) provided by

the Federal Bureau of statistics. To further dig into agglomeration, he uses the Ellison-Glasier index

which takes into account the spatial distribution of plants across different regions. Moreover, the paper

gives special attention to the spatial disparity in road networks, human capital infrastructure and

manufacturing employment all across Pakistan. Consequently, the presence of such factors explains for

much of the agglomeration taking place in major cities across the country. Coming back to the

methodological tools used in the paper, the Ellison-Glasier index marks areas that have high

concentration of industries to be greater than 0.05. Cosmopolitan cities like Lahore, Karachi and

Peshawar reap the manifold benefits of agglomeration due to easy access to roads and a better human

capital infrastructure. Hence, these areas are marked by a higher share of industries with startling a

startlingly higher value of agglomeration index.

Sadly, the persistent nature of spatial inequality is evident of the lack of infrastructure, road networks

and human capital infrastructure. This has eye-opening implications for policy makers in Pakistan who

need to shift focus towards this subject area if industrial growth has to be achieved in the economically

stricken country. Moreover, the paper also sheds light on the idea that the EG index has fallen over the

years due to a strange introduction of a variety of industries in various cities. However, the

concentration index for Tabacco and non-ferrous industries seemed to take an upward shift during the

995-1996 and 2000-2001. In Pakistan, localization economies are much more important than

urbanization economies as suggested by the empirical findings.

From a learning perspective, the emphasis on the Pakistani context has been particularly revealing and

has lead towards new policy implications. According to Dr. Burki, the lack of empirical data acted as

hindrance towards further exploring the trends of agglomeration in Pakistan.