Giving Voice to the Informal Economy in Pakistan

Over-population remains a critical challenge throughout South Asia. Current figures measure Pakistan’s population to be 207 million. While increasing population provides various opportunities in terms of human resources, it also puts burden on metropolitan areas. More people tend to settle in urban areas for a better standard of living, better governance and more economic opportunities.

For countries like Pakistan, where good governance and efficient public service delivery still remains elusive, this holds true. Strong local governance authorities seem to be a viable solution to address such issues. As in many developing countries, informal sector plays an essential role in the economy of Pakistan as well. Urban informal sector comprises of home based workers, domestic help, street vendors and waste pickers. Street vendors are different as they are running small-scale businesses. Street vendors are the most visible part of the urban informal economy bringing them in close interaction with local authorities.

A new program developed by the Policy Research Institute of Market Economy (PRIME Institute) in collaboration with the Friedrich Naumann Foundation for Freedom (FNF) aims to explore the possibility of revitalizing street vendors’ economies. Embedded in the liberal market economy ideals of conforming to supply and demand, “The Street Vendors Assembly” program explores various possibilities of upscaling the informal economies to formal economies. It also includes documenting the recommendations for policy formations to strengthen urban street economies and thus alleviate poverty.

“Street vending in metropolitan areas is mostly a male dominated sector providing fresh produce and other perishable and non-perishable items to middle and low-income families”, notes Muhammad Anwar, Head of Programs and Administration of the FNF Islamabad office.

“This informal sector has become critical to meet the needs of citizens. However, this sector remains isolated in terms of minimum tax generation and temporary locations”, he explains. 

Under this program, PRIME Institute organized the first street vendor assembly in one of busiest market areas of Islamabad. This market area supplies the capital city and its suburbs with fresh produce. The assembly focused on providing a platform to people associated with the informal economy to highlight their issues and find solutions in the presence of elected representatives of the Islamabad Municipal Corporation.

While addressing the challenges faced by street vendors, Deputy Mayor of Islamabad elaborated that, various departments are involved in management of the Federal Capital. “We all assume that Capital Development Authority (Islamabad administration) is responsible for solving the sewerage and water issues in market areas as well as residential areas. That is not the case. Under the current setup, water and sewerage facilities of commercial areas currently fall under the purview of Market Committee” informed Syed Zeeshan Naqvi, Deputy Mayor of Islamabad, when asked about how to resolve the water and sewerage issues in the market areas by street vendors.

He further shared that as per the local government law, sewerage and water supply is the mandate of the Metropolitan Corporation of Islamabad, of which he is one of the elected office bearers.

While discussing how to solve structural concerns like water sewerage and garbage collection, street vendors were hopeful that if they can inform the right authorities in a timely manner, they could hope to quickly resolve such issues in the future. Numerous street vendors highlighted the pressing apprehension of dealing with authorities who impact their morale. “We work hard to earn an honest day wage, what demoralizes us when authorities treat us with disrespect” many shared.

The Deputy Mayor, on that note, encouraged the street vendors of Islamabad to take initiatives like reporting disputes they face in their day-to-day work - verbally or by writing. Acknowledging the importance of rising digitalization in capturing citizen voices, Deputy Mayor recommended the use of short video clips for issue identification.  “To lodge a proper inquiry we encourage you to share your problems with proof like short video clips with us so that we can document them and immediately start redressal of your complaints”

PRIME Institute will conduct ten such Street Vendor Assemblies in various cities across Pakistan till the end of the year to identify and document tangible policy-level recommendations to strengthen urban street economies.