News Column

Engines of socio-economic change

June 9, 2014

Nauman Ashraf

Prime Minister Nawaz Sharif presided over the second computerised balloting for a grant of 6000 loans to youth including women, under the Prime Minister's Youth Business Loans Scheme on Wednesday.

The first balloting held recently also disbursed loans to the same number of men and women. The Youth Business Loan Scheme initiative differs from the previously failed schemes because it is being implemented through commercial banks who can take care of all aspects of the loans without political interference in line with the policies chalked out by the government.

Another aspect is government commitment to ensure the utmost transparency in advancing these loans to make sure that they are given only to the most deserving. The third salient feature of the scheme is the element of gender equality. These loans will range between five hundred thousand to two million rupees; a fair amount for starting a personal business, and providing excellent opportunities to skilled, qualified and professional men and women to explore and set up avenues of self-employment in a dignified way.

The Prime Minister announced the launch of six different schemes in September 2013, namely the Small Business Loans Scheme, Micro Interest free Scheme, Youth Training Scheme, Youth Skill Development Scheme, Fee Assistance Scheme and the PM Scheme for Laptops. The interest-free loan scheme for youth announced on 13th May will benefit one million individuals, costing Rs.3.5 billion to the exchequer. The scheme envisaging the disbursement of loans up to Rs.50,000 through Pakistan Poverty Alleviation Fund will cover the entire country, especially rural and far flung areas with 50% of the share going to young women.

The launch of the interest free loan scheme targets the poor and underprivileged sections of society.

Similarly, the Fee Assistance Scheme for students from far-flung and comparatively less developed areas of the country aims not only to facilitate the youth of those areas to pursue higher studies unfazed by the paucity of resources, but will be a tremendous help to the concerned families as well. The Youth Skills Development Scheme that envisages the imparting of technical training to boys and girls who have studied up to the eighth level and on the job training for graduates with a monthly scholarship of Rs.10,000 are also prudent policy initiatives.

The status of the youth of a nation as architects of its future progress and prosperity, has unqualified universal recognition and that is why nations all over the world focus considerable attention on harnessing the potential of their young generations-their human capital--through imparting education and skill.

In most developing and poor countries, a lack of education, finances and technological skills are the biggest hindrances to gainful employment. Thus, growing un-employment amongst the youth not only affects the economic progress of that country but also unleashes disastrous consequences for the society in the shape of lawlessness and crimes.

The idea of targeting the youth from less privileged classes gained currency during the early 50's and became a wide spread phenomenon in the 80's. Now, it forms an integral part of any growth model in the developing world. The strategy adopted was to provide micro-credit to the youth for setting up their own businesses, small industries, improving their technological skills for enhancing their chances of employability, or pursing higher education. This is regarded as a very vital ingredient of sustained economic growth. Bangladesh and Nepal in our region, who adopted this growth model are far ahead of us at the moment though they were far behind us to start with.

The package for the youth announced by the PML (N) government, is an imaginative move to tackle unemployment amongst the youth and enhances their skills and capability to engage productively in a national effort to change the socio-economic landscape of the country.

Though Rs.100 billion allocated for the purpose may seem like peanuts to some in view of snowballing unemployment amongst the youth, it is still a very substantial leap in the right direction. Economic recovery permitting and by more resources becoming available within the government, these allocations are sure to be enhanced and the scheme will be made a permanent feature of the national economic strategy.

The country can move forward only when there are greater employment opportunities in the private sector. Pakistan's government at present, employs only 7% of the work force and with more and more people joining the labour market, the private sector has to play a wider and more expansive role in this area. Pakistani youth are around 35-40% of the total population, and any move that ensures and guarantees their gainful employment is bound to accelerate the process of economic progress due to its multiplier effect, besides of course, enhancing the tax revenues of the government that this newly initiated economic activity will generate.

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Source: Nation (Pakistan)

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