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Resources of Pakistan

B-Com Part 2-II Economics Pakistan Notes


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Old 04-01-2010, 01:24 AM   #1 (permalink)
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Chapter 4 - Resources of Pakistan

* Natural Resources

* Mineral Resources

* Forest Resources

* Importance of Forests

* Energy

* Causes of Unemployment


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Old 04-01-2010, 01:25 AM   #2 (permalink)
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Natural Resources

National resources are backbone for the industrial development of a country. These resources play a dominant role in accelerating in the pace of progress and prosperity. Economic development of an economy is not possible without the availability of natural resources. Natural resources are divided into minerals, forests and hydle power/energy.

1. Mining and Quarrying
Pakistan has a widely geological frame work, ranging from pre-Cambrian to the present that includes a number of zones hosting several metallic minerals, industrial minerals, precious and semi-precious stones. Although many effort have been made in developing geological products, institutional, academic and Research and Development infrastructure, much remains to be done to enable this sector to take full advantage of its endowment. As a result of various efforts devoted for the development of mineral sector, resources of several minerals have been discovered over the last many decades, including world class resources of lignite coal deposits at Thar, Sindh, porphyry copper-gold deposits in Chagai, Balochistan, Iron ore deposits at Dilband, Balochistan, Lead-zinc deposits in Duddar, Balochistan, gypsum, rock salt, limestone, dolomite, china clays etc in the Indus Basic, ornamental and construction stones in the various parts of the country and about 30 different gems and precious stone deposits in northern Pakistan.
Mineral industry in Pakistan shows that over the last few decades this sector has been allocated very small amount - 0.45% to 2.46% of the total public sector expenditure since first five year plan reflecting its contribution to Gross National Product (GNP) of just around 0.5%. The mineral resources of a country are valuable means and measures of its economic and industrial growth. These are still more important for Pakistan because of its favorable geological environment and a large number of mineral resources in the country. Considering that substantial scope exists for the development uncertainties, it requires Government support and recognition of mineral sector.
The Govt. is fully committed to making the mineral sector in Pakistan one of the most profitable for the country. During the current fiscal year, mining and quarrying sector has registered a growth rate of 5.7 percent as against 4.58 percent of last year. The increased growth was propelled by strong growths recorded in magnetite-30%, dolomite-26.1%, Limestone-25.2% and chromites. To make this sector thrive more in the upcoming year the Govt. has already started various initiatives which is evident from the discovery and development of world class copper-gold deposits in Chagai, Balochistan by Australian Firms that would fetch $500 million to $600 million per year during the lives of these mines Development of Thar Coal field, one of the largest good quality lignite deposits in the world on completion, would provide additional source of energy.

2. Mines and Mineral Development Department
This department was created in Sindh in 2001 in pursuance of the National Mineral Policy, 1995. The department has taken all necessary steps for further establishing its field office. The province of Sindh has large quantities of minerals. In all there are 24 minerals which are being mined at present. The province also has large quantities of coal and granite reserves. The granite area which was previously inaccessible has now been connected with Karachi by network of roads and other facilities like Rest House etc. It is also proposed that Granite Park should be established at Nagarparkar. Karunjhar Range of Mountains in Nagarparkar has huge reserves of granite and other rock types of extractable thickness which has the potential to compete the international market.


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Old 04-01-2010, 01:25 AM   #3 (permalink)
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Mineral Resources of Pakistan

1. Natural Gas
Natural gas is used in domestic cooking, thermal power stations and steel furnaces and as a raw material for fertilizer industry and in CNG kits for transport purpose. It is used almost in every industry. It is found in Sui, Attock, Pirkoh and Kandhkot.

2. Petoroleum
Petroleum or Crude, oil is used in transport, power-generating stations, in iron and steel furnace Petroleum is known as black liquid gold. Of the total requirement only 40 percent is produced with the country and the rest is imported from abroad. Crude oil is found at Jhelum, Rawalpindi, Badin, Attock and Mianwali.

3. Coal
Coal is used in thermal power station and in furnaces for making bricks. About 80 percent of cement industry has now switched over to indigenous coal from furnace oil that has saved considerable foreign exchange being spent on the import of furnace oil. Quality of coal is not very good. It is available at Dandot, Makerwal, Harnai, Lakhra (Sindh). The coalfield in the Sindh province has huge coal resources of about 175 billion tones. In view of the anticipated shortfall of electricity and other energy resources during the next 10 years, the maximum utilization of coal would be required in power generation and gasification. To ascertain commercial viability of mining coal from Thar (Sindh), German consultants have completed a mining feasibility on a specific block in Thar Coalfield.
The coalfields in the Sindh province have coal resources estimated at 175 billion tones. Due to high cost of imported energy, government has decided to enhance the share of coal in the over all energy mix from 5 percent to 19 percent by 2030. Over 80 percent of coal was consumed by the brick kiln industry thus reducing the supply available for power generation. Approximately 80 percent of cement industry has also switched over to indigenous coal from furnace oil that has saved considerable foreign exchange being spent on the import of furnace oil. The conversion of cement industry from furnace oil to coal has generated a demand for 2.5 to 3.0 million tons coal per annum.

4. Chromites
Chromite is used in making engineering tools and stainless steel. It is found at Chaghi, Muslim Bagh, Malakand and Zhob.

5. Copper
Copper is used in electrical equipment, power and communication transmission lines. It is found at Sandak, Chaghi.

6. Gypsum
Gypsum is used in the manufacture of cement, fertilizers and Plaster of Paris. It is found at Hazara, Kohat, D.G.Khan and Dandot.

7. Iron Ore
Iron ore is used in making steel and engineering products. Quality of iron ore is not of good standard. It is found at Kalabagh, Chitral, Hazara, Makerwal and Khuzdar.

8. Rock Salt
Rock salt is used for cooking as well as in the manufacture of soda ash. It is also used in textile and tanning industries. It is found at Khewra, Warcha and Kalabagh.

9. Marble and Granite
Marble is used for decoration in construction industry. It is available in great quantities at various places of the country.

10. Lime Stone
Limestone is used in manufacture of cement, bleaching powder and glass and paint industries. It has rich deposits in the country. Lime stone is found at Hyderabad, Potohar and at Khewra Salt range.


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Old 04-01-2010, 01:26 AM   #4 (permalink)
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Forest Resources of Pakistan

Forests play a very important role in the economy of a country. There is shortage of forests in Pakistan. Pakistan has 4.01 million hectares covered by forests, which is about 5 percent of the total land area. Eighty-five percent of this is a public forest, which includes 40 percent coniferous and scrub forests on the northern hills and mountains. The balance is made up if irrigated plantations and Riverain forests along major rivers on Indus plains, mangrove forests on the Indus delta and trees planted on farmlands. Though the forest resources are meager, it plays an important role in Pakistan's economy by employing half a million people and fulfills one-third of the nation's energy needs. Forest and Rangelands support about 30 million herds of livestock. Forestry sector plays an important role in soil conservation, regulates flow of water for irrigation and power generation, reduction of sedimentation in water conveyances and reservoirs, employment and maintenance of ecological balance.
Total forests area of Punjab, NWFP, Sindh and Balochistan is 0.48, 1.33, 0.84 and 1.36 million hectares respectively. Pakistan being an agricultural country relies on sustained supplies of water and fertile soil. This is only possible when our forests and watersheds in the high hills are intact. Pakistan being a forest deficient country is facing timber and fire wood shortage to the tune of about 29 million cubic meters. There is need to increase the area under tree cover, not only to meet material needs of growing population but also to enhance environmental and ecological services being provided by the forests.


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Old 04-01-2010, 01:26 AM   #5 (permalink)
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Importance of Forests in the National Economy

1. Raw material for paper, sports, silk, furniture and tanning industries.
2. Medical herbs and seeds for pharmaceutical industries.
3. Recreation facilities for tourism and camping.
4. Timber/woof for fire.
5. Reduce floods intensity.
6. Increase fertilizer of land.
7. Provide employment opportunities.
8. Causes rains.
9. Control soil erosion.
10. Fodder for cattle.
11. Provide employment opportunities.
12. Chemicals such as turpentine oil.
13. Leaves of forests provide natural fertilizers.
14. Forests are great source of recreation, natural beauty and attraction.


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Old 04-01-2010, 01:26 AM   #6 (permalink)
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Energy

Pakistan's economy has been growing at an average rate of 7.6 percent per annum and the government is making efforts to sustain the momentum going forward. Knowing well that there exists strong relationship between economic growth and energy demand government is making efforts to address the challenges of rising energy demand. These include import of piped natural gas from Iran and Turkmenistan, import of LNG, increase in oil and gas exploration in the country, utilizing 175 billion tones of Thar coal reserves, setting up of new nuclear power plants, exploiting the affordable alternate energy resources and overhauling existing power generation plants to enhance their generation capacity. In addition to increasing supply, there is a need to promote efficient use of energy resources as well. At present Pakistan meets its energy requirement of over 75 percent from domestic resources, around 50.4 percent of its energy need is met by the indigenous gas, 28.4 percent by domestic and imported oil and 12.7 percent by hydro electricity. Coal and nuclear contribution to energy use is limited to 7% and 1% respectively. While the widening of energy supply and demand gap remains a challenge for Pakistan, it also provides viable investment opportunities for both local and international investors.


Main Energy Sources

1. Hydel power.
2. Natural gas.
3. Petroleum.
4. Coal.
5. Atomic Energy.


Importance of Power/Energy

1. No industry can run without power/energy. All machines require energy to operate them.
2. No agricultural machine can function without it. Tube wells, tractors, trolleys, threshers all require energy i.e. electricity, diesel or petrol.
3. No transport and communication service such as trucks, cars, railways or aero plane can operate without energy/petrol/diesel etc.
4. No domestic appliances such as electric bulbs, television, fridge, juicer and blenders can function without the use of energy/electricity.


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Old 04-01-2010, 01:27 AM   #7 (permalink)
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Causes of Unemployment

Population of Pakistan is about 154 million whereas the growth rate of population is about 2.6 percent per year. The total labor force is 47.67 million, out of which 44.01 million, is employed and 3.66 million is unemployed. The main cause of unemployment is as under:

1. High Population Growth Rate
Due to rapid increase in population unemployment rate is increasing very fast.

2. Low Rate of Investment
In Pakistan, per capital income is very low, therefore savings are very low, hence investments are less. Due to low investment are employment opportunities are not coming up.

3. Mechanization of Agriculture
Agriculture is under process of mechanization. Machines are replacing labor and creating unemployment. Migration from villages to cities is also a cause of increase in unemployment, as cities have already reached to the saturated level and could not absorb new job seekers.

4. Sick Industries and Privatization
Industries are facing many problems. Many of them are at the verge of collapse due to lack of availability of imported raw material, short of demand in local market, reduction in their exports and competition with foreign imported goods. Number of sick industries is increasing day by day which is causing unemployment in the country. Moreover due to privatization policy of the government, state owned industries are being sold out to private sector, where labor is being reduced thus causing unemployment in the country.

5. Decrease in Foreign Employment Opportunities
Due to war between Iraq and Kuwait, attack on Afghanistan and Iraq economic crises in Middle East and in other European countries, Pakistani workers have been removed from their jobs thus creating unemployment situation in the country.


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