July 06 - 12, 2009

Karachi, the largest city of Pakistan and the capital of Sindh province, situated on the eastern coast of the Arabian Sea and to the north-west of the Indus River, is the financial and commercial hub of Pakistan because it is a gateway to the country's imports and exports.

Karachi accounts for a lion's share in Pakistan's total revenue because it generates 5% of the national revenue (federal and provincial taxes, customs, and surcharges), although a larger part than this amount is accounted for as indirect taxes. Karachi produces about 42 percent of value added goods in large-scale manufacturing and 25% of the GDP of Pakistan. In February 2007, the World Bank identified Karachi as the most business-friendly city in Pakistan. Karachi has a state-of-the-art international airport where flights from all over the world land and take off. It has thus become the "Gateway to Pakistan". Being the commercial hub and gateway of Pakistan, it accounts for 95% of Pakistan's foreign trade and contributes 30% of Pakistan's industrial production.

Karachi is the nerve center of Pakistan's economy, as most of public and private banks are headquartered at Karachi's I.I. Chundrigar Road, while leading foreign multinationals operating in Pakistan have their headquarters too in the city. The Karachi Stock Exchange is the largest stock exchange in Pakistan, and is considered by many economists to be one of the prime reasons for Pakistan's 8% GDP growth across 2005.

During the 1960s, the City of Karachi was seen as an economic role model around the world, and there was praise for the way its economy was progressing. Karachi has several large industrial zones such as SITE, Korangi, Northern Bypass Industrial Zone, Bin Qasim, and North Karachi located on the fringes of the main city. The primary areas of industrial units are textiles, pharmaceuticals, steel, and automobiles. In addition, Karachi has a vibrant cottage industry and there is a rapidly flourishing Free Zone.

Karachi has branches of major motor companies such as BMW, Mercedes, Land Rover, Chevrolet, Toyota, Honda, General Motors, Suzuki, and HinoPak.

Karachi has a seaport, which is the source of conducting international trade and business. Steady improvements in harbor facilities had made Karachi a leading Indian port by the late 19th century. The City of Karachi is considered as commercial and industrial capital of Pakistan, as it has played a vital and dominant role in erecting Pakistan's economy on firm basis. The economy and population of Karachi have expanded significantly. Investments have been made in the city's urban infrastructure over the past few years.

The Karachi Deep Water Container Port being the state-of-the-art facility to handle the new generation of vessels is a source of attracting foreign investment in the country.


Despite global financial crunch and stiff competition in the international markets, Pakistan's rice exports have crossed the $2 billion mark in the fiscal year 2008-09. According to sources in Rice Exporters Association of Pakistan, Pakistan exported a total of 2.896 million tons rice to different countries during July 1, 2008 to June 27, 2009.

Out of the total rice exports, Pakistan exported 909,709 tons Basmati rice worth $995,995,749 while 1,987,137 tons non-Basmati rice worth $1,004,243,092 was exported in this period.


The World Bank has approved a US$50 million IDA credit to Pakistan, designed to improve water resource management and enhance agricultural productivity in Sindh Province. The additional financing for the Sindh On-Farm Water Management Project aims at to improve the efficiency, reliability, and equity of irrigation water distribution at watercourse levels and enhance agricultural productivity.

Under the additional financing around 3,000 watercourses will be improved, which comprises earthen improvements, lining, installation of concrete turnouts (pucca nuccas), and culverts in watercourses.

About half of Sindh's 35 million people live in rural areas, and one-third of them live below the poverty line. Rural people 70 percent of them are landless derive almost 60 percent of their income from agriculture.

"Irrigation and drainage are critically important to Sindh's irrigated agriculture, which is the backbone of the economy," said Yusupha Crookes, World Bank Country Director for Pakistan. "The improved watercourses under the original Sindh On-Farm Water Management Project have made positive impacts in terms of enhanced and more equitable water supply and increased incomes by farmers. This additional financing will help extend these benefits to broader sections of the farming community in Sindh."

The province has about 42,000 watercourses and so far, 17,000 watercourses have been improved/lined under various on-farm water management programs, including the Sindh On-Farm Water Management Project.

The additional financing will also support efforts to boost agricultural productivity through demonstration on tunnel farming for high value crops, and training of farmers in improved water management, agricultural practices, and new technology and information dissemination.

"Participation of the farmers in irrigation management is vital for the long-term sustainability of the irrigation system," said Tumurdavaa Bayarsaihan World Bank Senior Rural Development Specialist and project task team leader.

"This project supports capacity building and social mobilization of farmers in order to develop and strengthen sustainable Watercourse Associations which will participate in planning, designing, and implementing the rehabilitation works and will also operate and maintain the improved watercourses."

The credit from the International Development Association (IDA), the World Bank's concessionary lending arm, carries a 0.75 percent service fee, a 10-year grace period, and a maturity of 35 years.