Source of attraction for foreign investment


Apr 28 - May 04, 2003




One of the Town Nazims of Peshawar City, addressing a press conference directed the owners of shoe, carpet, chemicals, soap and trunk making factories to shift their units from the residential areas, otherwise the units would be shutdown. The decision has reportedly been taken in the larger interest of the city residents who were badly affected by the industrial and commercial activities in residential areas. Such industries often unduly exploit the resources of the residential areas, such as piped water and electricity, etc. in addition to seriously disturbing the peaceful living of the community by the comings and goings of people at odd hours and the movement of raw materials and the finished goods through delivery vans or trucks.

Residential areas generally are confronted with uncollected solid waste, overflowing sewerages and emissions from vehicular traffic. The industries operating in the residential areas aggravate the situation through air and water pollution and releases of effluents and thus seriously harming the clean atmosphere in the residential areas. According to the environmentalists many industries particularly steel, paint, and marble industries release in the air particulates that seriously damage the atmosphere. Such particulates are also found in diesel smoke, fine ash and dust. Smaller particles, when inhaled, can cause a lot of trouble. In urban areas, five to 20 per cent of particulates are various sulphates, believed to be responsible for increase in asthma attacks, aggravation of any heart and lungs disease, and a lowered resistance to breathing problems among children. These particulates destroy plants by covering their leaves, thus, reducing their access to sunlight. They also make buildings and other materials, such as cloths and other fabrics, dirty. Sulphur dioxide corrodes buildings in the same way as acid rains. People need to be protected as far as possible from these harmful substances.

The five industries mentioned in his address by the Town Nazim in my opinion are only a tip of the gigantic iceberg. There are so many diverse industries and commercial establishments presently operating in the residential areas and thus are harming the peaceful and clean atmosphere essential for the residential areas. The Town Nazim has drawn attention to a problem that is common to most other towns and cities in the country. Many residents are raising their voice to get such menace out of the residential areas. The issue, being of common interest to the people, is being further explored in this article.

It may be noted that the closing down of the industries operating in the residential areas would solve one problems but result into many other problems, if the process is not handled properly and judiciously. Industries and commercial enterprises located in the residential areas also provide employment to the residents and other people nearer to their homes. In the present day conditions when poverty is becoming more pervasive with passing of every day, the decisions of shifting out or closing down the factories must be taken after careful considerations of the pros and cons and then implemented in a fair and transparent manner. This process may have better results if we first explore the factors that contributed to this unpleasant situation and also how best to minimize the possible loss to the factory owners and to help save the gainful employment of the people.

Most often the individual industries, when originally set up, were away from the residential areas. However, with the outward spread of cities and towns due to population pressures such industries are now in the middle of residential areas. The situation calls for careful handling. The shifting of such industries may not be financially viable unless it is managed properly and supported by the government. Additionally, some small industries are said to locate their production facilities in residential areas for avoiding payment of sales tax or central excise to the government authorities. Further, it is not uncommon that the commercial goods/raw materials particularly chemical are clandestinely stored in residential areas and thus exposing the population to different hazards including fire. It is said that most often such things happen due to inefficiency or connivance of the concerned civic authorities.



The Cities and Towns, within their limits, have large, medium and small industrial estates that were set up with government approval and were originally away from the residential areas. Karachi City has a number of industrial areas such as SITE, Korangi Industrial Area, the North Karachi Industrial Areas, etc. Also large cities such as Lahore, Faisalabad, Gujranwala, Multan, etc. have approved industrial estate within their present limits. At one time these industrial estates were away from the residential areas but now these have residential localities all around them. Shifting of these industries may not be practicable in the short-run. Until it is decided to relocate these industries, efforts may be made to minimize harm to the people living in the vicinity by controlling air, water and noise pollution and other irritants.

Some of the industries located within the residential areas may be carrying on an important trade that meets the needs of the people living in the area. In other cases it may be a medium or large industry that is creating lot of problems for the residents and has been continuing operations in the face of organised resistance from the people of the area. In some rare instances the operations may be continuing due to the owners exploiting close relations with the people in power. While considering and selecting the industries to be shifted, a clear distinction has to be made between the two types of industries mentioned above. This also applies to the large commercial establishments operating in the residential areas. Some industries may be operating in the rented premises while others may be located on land and buildings owned by the factory owners. The two types need different treatment. People who rented out the buildings may be cautioned not to indulge in such practices in future and thus create problems for the whole community by bringing in tenants that are not to be allowed in the residential areas.

Peaceful living in the residential areas may also be disturbed due to the carrying on of different large scale technical trades such as car repairs, denting and painting, making of wood and steel furniture, etc. The residents are also disturbed when the private houses are turned into private schools, hospitals, beauty clinics, etc. All these establishments may be considered for relocation to commercial areas or to the specifically designed technical trade centres.

The City government needs to define the industries and commercial establishments that are to be shifted from residential areas to other areas. The process has to be transparent and finalized after detailed open discussion. Due to clash in interest of different residents or association with the factory owners, it would not be easy to decide as to which particular industry should be shifted out of the municipal limits or to specially developed industrial/commercial areas within the city limits. Objective criteria may be developed to maintain cordial relations in the community and without generating ill feelings against the industries, which otherwise are essential for economic development and for creating jobs. The objective criteria may be developed from policy principles such as the following:

- No small, medium or large industry to be allowed in future in the residential areas. Industries already so located to be shifted out as per agreed priority and the time schedule. This also applies to medium and large commercial organisation.

- Priorities for shifting the industries would be developed carefully based on factors such as size, number of people employed, level of air/water/noise pollution, or other nuisance to community. Until the pollutant industries are actually shifted they would be required by the City government to use treatment plants to filter hazardous smoke emissions/effluent water so that the residents are not exposed to hazardous pollution.



- Existing code of the City government for locating industry and commercial organisations may be up-dated and revised in the light of present day considerations. All such establishments may be licensed and any business without a proper valid license may be liable to be closed. The license to be for one year, and renewable if the prescribed conditions are fully complied.

- In order to protect the interests of the workers, it is suggested that the industrial units may first be registered with the government authorities such as EOBI, ESSI, etc. The units located in the residential areas, before shifting, may be required to register with the authorities, if these are not already registered.

- Technical trades such as car repairs, denting, painting, furniture making, car wash facilities, bakeries, dry cleaning plants, and other similar facilities to be shifted to properly designed technical trade centres. Once the Technical Trade Centres are ready to accommodate location of such technical trades, these trades should not be allowed to operate in the residential areas.

- A clear policy to be adopted and announced for the location of private schools, offices or private hospitals in the residential areas. Single owner grocery shops, fruit stalls, clinics, etc. may be allowed in the residential areas.

The shifting of factories may involve large expenditure and all factory owners might not be in a position to finance all that expenditure. Chemical and process industries may be difficult to shift without incurring significant damage to the plant itself, while it may be easier for some other industries to relocate. The City government may have to facilitate the shifting by helping arrange necessary grant/loan funds for the purpose. The City government may also have to take responsibility for finding an alternate place for relocating the industry/commercial establishments as well as the provision of necessary utilities and physical infrastructure for movement of raw materials and finished goods to the market. Without such assistance the shifting may not be smoothly carried out.

Each city and town may earmark certain areas as commercial or small industry areas within the city/town limits. Under a phased programme units falling in the prescribed categories may be asked to shift to these areas within the prescribed time. Technical Trade Centres and Commercial Buildings might be developed by the City government and leased out to the micro-industries and the technicians. The private sector could also be invited to develop such facilities for selling/leasing out to the needy people. Once the facilities are ready, failure to shift within the specified time to be sufficient reason for the City government to refuse the license required to carry out the usual business within the residential areas.

The City government has to be careful to the new use of the property vacated by the industry that has been shifted. Such properties may be disposed of in different ways depending upon the circumstances of each unit and the owners. Some may be used as residential purposes; while others may be converted into community centres, schools. If possible, the City government may acquire the land for developing parks for the benefit of the community. The City government may exchange this land by allocating some other land away from residential areas to relocate the industry. The industries located in the residential areas may possibly include some industrial units that are owned by the public sector. In all such cases, the City governments may request the government and ask for allocation of the land for establishing the community welfare projects there.

The City and Town governments in the country appear fascinated by the development of amusement parks by the private owners, who also establish restaurants or other technical or commercial activities. Some of the industries and commercial establishments being shifted from the residential areas may possibly be relocated, depending on the priority, in an area carved out from the proposed parks.

Shifting of industries from the residential areas is not enough unless it is accompanied with improvements of the physical infrastructure, which at present is mostly poor in almost all the residential areas. Provision of potable water, proper sewerages, collection of solid waste, etc. may be taken up along with construction of proper roads and footpaths in the residential areas.