Agriculture and livestock rearing are the major sources of income in Balochistan. The extraction of natural resources also contributes to the economy.
Last Updated: 28 Apr. 2014
Balochistan lags behind the rest of Pakistan in terms of economic and social development. From 1972-2005, the economy of Balochistan has expanded 2.7 times, the smallest long-term growth in all the provinces across the same time span. Over the last 15 years, its contribution to Pakistan’s GDP has remained around 4%.
Like Punjab and Sindh, Balochistan relies on agriculture, but unlike its neighbors Balochistan is mostly a dry and barren land with chronic water scarcity and persistent droughts. Due to these factors, agriculture in Balochistan focuses on non-staple high-value products. Horticulture is found mainly in the high altitude northern areas, while field crops are cultivated in the irrigated northeast close to the Indus Basin.
Livestock rearing is the major occupation in the province with 73% of the population relying on it as a source of livelihood. It contributed 8% to the total GDP of Balochistan in 2010. Though 93% of Balochistan is considered rangeland, overgrazing, water shortages, and droughts have led to loss of grazing land. Currently only 33% of the land can be considered reasonably productive grazing land. Livestock rearing is found mostly in the central and western districts and fisheries are found in the coastal areas.
Large-scale enterprises and manufacturing are scarce in Balochistan. The demography and geography of this province are favorable for small-scale enterprises that lead to limited business opportunities. There were only 62,000 business establishments registered in Balochistan in 2003. In addition, nearly 66% -75% of all enterprises in Balochistan (rural and urban) are accounted for by wholesale and retail trade. Such businesses generate little sales and employment, and the community receives little or no benefit from it. A few industry clusters are present in the Hub area next to Karachi.
Balochistan is home to rich mineral and petroleum deposits, much of which have not been exploited. A 2008 World Bank report stated that Balochistan contributed one-fifth to Pakistan’s mining GDP with 0.23% of the total employed persons in the province working in this sector in 2006. It also stated that 39 minerals were being mined from Balochistan and were generating Rs. 3.4 billion in annual revenue.
Natural gas and coal are two of the most exploited mineral deposits in Balochistan and are widely used in Pakistan. In 1995, Balochistan was contributing nearly 56% to Pakistan’s total output of natural gas, but by 2007 its shares had dropped to 22.7%, and that same year it consumed only 5.81% of the country’s total output. Currently, it is the second largest producer of natural gas in Pakistan after Sindh, but consumes much less than it produces. Additionally, the provincial government is forced to sell at a lower price as compared to other provinces, leading to contention between Baloch nationalists and the federal government.
The total coal reserves of Balochistan are about 459 million tonnes and produces more than 50% of the country’s total coal output. Uranium and other precious metals such as copper, gold, silver and platinum are also present.