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by | Jul 30, 2025

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Managing Regional Disparities, and Inclusive Growth: Economic Strategies for Balochistan and Other Underdeveloped Regions

Jul 30, 2025 | Economics and Trade









Standing in the heart of Lahore’s bustling Gulberg or Karachi’s glittering Clifton in neon lights, flyovers, and restaurants one hardly realizes that such is not the status quo of development in this country. 

The real status quo? 800 kilometers west in a remote village of Balochistan, where basic healthcare is miles away, schools lack walls, and broadband is but a dream. This is the paradox of modern Pakistan—a nation racing ahead in its limited urban cores while many of its peripheries remain entrenched in poverty, neglect, and silence.

For Pakistan to become a truly progressive, resilient, and equitable society, the growth of its city centers must not come at the expense of its margins. Regional disparities are more than economic challenges—they are threats to national cohesion, human dignity, and long-term stability. Among all provinces, Balochistan presents perhaps the most urgent case.

Why Do Disparities Exist?

Understanding the roots of underdevelopment in regions like Balochistan, South Punjab, and parts of interior Sindh requires unpacking a matrix of interlinked causes. One cannot simply blame present day political leadership about the condition of these areas. A small list of a rather innumerable number of factors, is as follows:

  1. Historical Neglect: Colonial administrative structures focused investment in urban and canal-irrigated areas. Post-independence, a similar strategy persisted.
  2. Geographical Isolation: Rugged terrain, low population density, and poor connectivity make service delivery and economic integration difficult.
  3. Security Challenges: Persistent insurgency and law enforcement gaps have discouraged investment and restricted mobility.
  4. Weak Governance: Limited institutional capacity in provincial governments has hampered effective project execution.
  5. Lack of Human Capital: Low literacy, poor health outcomes, and minimal technical education limit local participation in growth.
  6. Inequitable Resource Distribution: Despite contributing significantly to natural resource extraction, local populations often see little reinvestment in their communities.

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Signs of a Policy Shift

Over the past three years, the federal and provincial governments, in coordination with the military establishment and donor partners, have made regional inclusion a cornerstone of national development planning. This is evident from a range of targeted initiatives, most notably through Public Sector Development Programme (PSDP) allocations.

According to the Ministry of Planning, Development & Special Initiatives, PSDP 2024-25 allocates over Rs 80 billion specifically for development schemes in Balochistan, marking a significant 35% increase over FY2022-23. These funds span infrastructure, education, health, water supply, and energy.

Among the flagship initiatives are:

  • Gwadar Development Package: Includes the Gwadar International Airport (near completion), desalination plants, and road links to Makran and Rakhshan divisions.
  • M-8 Motorway Completion: Connecting Gwadar with Ratodero, this vital artery integrates Balochistan into national supply chains.
  • Quetta Safe City Project: Improving security architecture to encourage commercial activity.
  • University Upgradation Projects: Boosting higher education capacity in Zhob, Khuzdar, and Turbat.

These are not mere paper promises. The Pakistan Economic Survey 2024-25 confirms that over 60% of PSDP allocations to Balochistan in FY2023-24 were actually released and utilized—a notable departure from historical trends where funds remained unspent.

Fostering Jobs and Skills

Economic disparity is not just about infrastructure. It’s about opportunity. In 2022, Balochistan’s youth unemployment rate was estimated at over 25%, significantly higher than the national average, as per UNDP Pakistan.

To address this, the federal government launched the Balochistan Youth Skills Development Program, training over 10,000 youth in trades such as solar technology, refrigeration, heavy machinery, and digital literacy. The National Vocational and Technical Training Commission (NAVTTC) has expanded operations in Balochistan with support from the China-Pakistan Economic Corridor (CPEC) skill development fund.

Additionally, the Ehsaas Program and its successor, BISP Kafalat Plus, have scaled up cash transfers and livelihood support in underdeveloped districts, prioritizing women-headed households and persons with disabilities. This dual strategy of social protection plus upskilling reflects a nuanced approach to inclusive growth.

Connectivity as a Catalyst

No region can grow in isolation. Real inclusion requires connectivity—physical, digital, and institutional. The Digital Balochistan Initiative, launched in 2023 by the Ministry of IT & Telecom in collaboration with PTA and USF, has rolled out 4G infrastructure in 25 underserved tehsils, connecting over 2 million previously offline citizens.

New fibre-optic lines have also been laid under the Pak-China Digital Corridor, enhancing both domestic telecom reach and cross-border data connectivity. These investments unlock new frontiers: remote work, digital payments, telemedicine, and e-learning.

Similarly, investment in regional airports (Turbat, Zhob, and Panjgur) and rail link feasibility studies under CPEC Phase-II promise long-term transformation in how people and products move.

Local Empowerment

Sustainable development must be locally owned. In this regard, the Balochistan Integrated Development Strategy (BIDS), formulated in 2023 with support from the World Bank and UNDP, marks a significant milestone. It envisions a decentralized model of development, where district-level planning boards propose and prioritize projects based on ground realities.

The federal government’s endorsement of this model through the Inter-Provincial Coordination Council (IPCC) reflects a maturing policy ethos: inclusion through devolution. Additionally, special constitutional protections under Article 38 (social and economic wellbeing) and Article 37 (promotion of education and social justice) are being increasingly invoked to prioritize lagging regions.

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Challenges and the Road Ahead

Despite notable progress, challenges remain. Corruption, procurement inefficiencies, and capacity deficits continue to delay some projects. The National Accountability Bureau (NAB) has flagged several cases of misallocated funds in development schemes across Balochistan.

Furthermore, urban-rural gaps in other provinces also need targeted policy. South Punjab’s rural belt, for instance, has higher multidimensional poverty indices than some tribal areas, as per Oxford Poverty and Human Development Initiative (OPHI).

To sustain inclusive growth, Pakistan must:

  1. Institutionalize Need-Based Transfers: Use data-driven criteria for allocating PSDP resources rather than political bargaining.
  2. Promote Public-Private Partnerships (PPPs): Especially in tourism, agriculture, and logistics in Balochistan.
  3. Ensure Transparent Monitoring: Real-time dashboards and third-party audits for all regional projects.
  4. Expand Local Government Structures: Empower elected district governments to manage service delivery.
  5. Strengthen Civic Engagement: Community monitoring through civil society can reduce leakages and improve feedback loops.

From Margins to Mainstream

Inclusive growth is not a slogan. It is a necessity. If Pakistan is to stabilize its politics, reduce extremism, unlock its human capital, and grow sustainably, it must invest in its neglected regions. And that investment must be smart, transparent, and locally grounded.

The cities may remain the engines, but the peripheries are the anchors. Without lifting the base, the nation cannot rise.

What we are witnessing now—with improved allocations, project execution, and institutional reforms—is a welcome shift. But the journey from disparity to dignity is long, and it demands unwavering political will, civic partnership, and policy continuity.

Because only when every child in Balochistan, Gilgit-Baltistan, and interior Sindh has the same opportunity as a child in Islamabad or Lahore, can we truly say: Pakistan is moving forward.