August Issue 2013

By | Newsbeat | Published 11 years ago

There is one thing that is bothering both the CEOs and the employees of factories located in Sindh Industrial Trading Estate (SITE) alike: excessive dust.

The managers of the textile and pharmaceutical companies come to work dressed in clean clothes and glistening cars. But by the time they head home in the evening, their vehicles need a wash. Those workers who travel on scooters and cycles are equally miserable: wiping the windshields and seats has become tiresome exercise.

The pothole-ridden roads and streets in SITE Town, Karachi have become a major headache for businesses. The infrastructure in the estate, which was already reeling from the menace of extortions and street crimes, is in tatters.

No one can recall the last time any major renovation was carried out in the industrial estate. Even the main highway, the M-9 that cuts through the country’s largest hub of factories, is in such bad shape that it often takes hours to cross a patch of just two kilometers.
“This place has become an embarrassment and we can’t even invite any foreign clients here. We meet all of them in hotels,” says the chairman of a textile company.

SITE is managed by the government-controlled Sindh Industrial Trading Estate (Site) Limited, and there are complaints galore against the institution. Spread over 5000 acres, SITE’s strategic location near the Karachi Port and its close proximity to Baldia, Orangi and Banaras, (where a constant supply of cheap labour is available) makes it ideal for setting up a manufacturing facility.
Every year Site Limited meticulously prepares a budget, detailing its planned expenditure on construction of roads, a sewerage system and water supply schemes. But no one knows how, when and where that money is spent.

In the financial year 2010-11, Site Limited collected Rs376 million from factories in SITE Karachi and spent Rs353 million, leaving a surplus of Rs23 million. But a major chunk of Rs319 million was spent on paying staff salaries and other office expenses. Only Rs34 million were spent on the repair of roads and other development projects.

Naseem Anwar, the senior vice chairman of Site Association of Industry (SAI), which represents businesses operating in the estate, says Site Limited has become more of a political tool to reward favorites rather than help in promoting industrialisation. SITE Ltd is bulging at the seams with political appointees.

“In 2004, they had 500 employees and now they have more than 1900,” he reveals. “We don’t pay them to provide employment. We pay them to address our problems. There is a garbage dump in front of my factory’s gate and no one bothers to remove it because Site Limited is least interested.”
Successive heads of Site Limited have pleaded that they have limited sources of revenue and the provincial government does not contribute towards development schemes.
“That’s rubbish. They take Rs12,000 per acre from us as conservancy costs, besides rent, plot transfer fee and other charges,” says Anwar.

Industry people maintain that the state of affairs in Site Limited deteriorated in the past couple of years as political interference rose. The fact that Site Limited is responsible for approving land sale deeds in this expensive estate makes the seat of the managing director all the more important. And that position has been blatantly misused. In complete disregard of rules, more than 45 compressed natural gas stations and other commercial enterprises like warehouses have been allowed in SITE, which is meant exclusively for industrial activity.

What bothers Aziz most is the commercialisation of land in SITE. With the prices of plots rising, real estate developers are taking a keen interest in the area. “If a shopping mall or apartment building built on my four acres of plot that faces the road fetches a good price then, why not? This is how we have started to think now.”

Incidentally, no one from Site Limited was willing to discuss the issues confronting the organisation. Managing Director Sajjad Hussain Abbasi continued to make excuses instead of answering questions.
“I have taken over office just three months back. During my first month, all government officials were busy with the elections and then vacations. Now it’s Ramazan and I haven’t been briefed on issues,” he told me in his office on July 23, and asked me to see him the following day.
Half-a-dozen people holding files in their hands were waiting for Abbasi on the afternoon of July 24. He did not bother to meet Newsline and referred the reporter to the chief engineer, Shams Uddin Sehto, who also refused to respond and, instead asked for written questions. The answers never came.
The most pressing question relates to the reserve fund of over Rs 200 million, which Site Limited used to maintain for investments in infrastructure. According to sources, that money was invested in mutual funds, which went down. The amount was wiped off Site Limited’s book to cover up the loss.
Another long-pending issue in SITE is the scarcity of water. SAI says that against the charges collected from them, Site Limited is responsible for ensuring uninterrupted water supply. However, almost the entire water allocation is consumed by 25 ‘favourite’ factories, owned by people who wield influence in political circles. The rest pay out of their own pockets to buy water tankers. And every time, the Karachi Water and Sewerage Board (KWSB) shuts down water hydrants, the rate of the tankers shoots up, adding to the manufacturing costs.

There also appears to be a clear divide within SAI, once considered to be one of the most powerful bodies representing industrialists, and now reduced to issuing statements on power breakdowns every now and then.

Majyd Aziz, who headed SAI in 1998-9, says SAI has lost its past glory. “Most of the businessmen now associate themselves with trade associations or with the Karachi Chamber of Commerce and Industry.”
Recalling an incident that speaks volumes of SAI’s weakness, he said that a roadside kiosk, which was placed near the association’s office, was removed after an objection was raised in one of the meetings.
“By the time we all met at the next meeting, the kiosk was back there once again. That was the day it became obvious that we had lost our clout.”

What bothers Aziz most is the commercialisation of land in SITE. With the prices of plots rising, real estate developers are taking a keen interest in the area. “If a shopping mall or apartment building built on my four acres of plot that faces the road fetches a good price then, why not? This is how we have started to think now.”

Karachi is home to five other industrial estates located in Korangi, Federal B Area, North Karachi, Landhi and Bin Qasim. While infrastructural problems exist in all of them, the members of their associations manage their own affairs unlike SITE, where the government has appointed a bureaucrat to manage municipal and development services.
Senior SAI member Nazim Haji says it’s about time Site Limited is dissolved. “There is no further development taking place in the area in any case, so there is no reason for it to exist. The businessmen can elect someone from amongst themselves to oversee all these issues.”