When Karachiites are wounded, the economy bleeds

It was Shahzeb Khans revengeful murder a few weeks back that got tremendous media attention. But the ill-fated 20-year-olds murder was just one instance. Countless people lose their lives in street violence and targeted killings in Pakistans largest metropolitan which is home to more than 18 million people.
One can go on to write pages and pages on the social implications of Karachis perilous security situation, but the economic impact of the same is even more magnanimous.
It is estimated that Karachi generates more than 25 percent of the GDP of Pakistan, and therefore, any impact on economic activity within Karachi is bound to have serious repercussions on the national economy.
Emanating from ethnic rivalries and having evolved to power-struggle clashes between representatives of various political parties, this citys violence is not just ethno-political, but also criminal, extortive and sectarian.
Needless to say, in a country where the GDP growth rate has been struggling for the past few years, the city which is the hub of industrial activities is bound to suffer from economic flailing. And the ensuing depravation and lack of resources make it a hotbed for criminal activities.
Though the impact of a struggling economy on violent outbreaks is generally accepted around the globe, the vice versa impact of civil unrest on the economy is also pretty much there. In the case of Karachi, property prices are a stark reminder of how markets get affected when the worse hits the fan.
Property prices in seemingly safe localities such as Defence, Clifton, and defence officers residential areas skyrocket every time something goes wrong in another part of the city. The impact on real estate prices is almost immediate.
Further, the threat of security restricts business and economic activities tremendously, as people choose to stay at homes and shops are closed down, literally paralyzing consumption, a key driver of national growth. The worse to be affected are the services sector - which generates a significant number of white collar jobs - as well as the informal economy, which, though undocumented, provides livelihood for many.
On a broader level, the impact has been well-touted. Pakistans decline on the Quality of Life Index, Karachis inclusion in CNNs list of most dangerous cities in 2010, all do a perfect job of tarnishing the image of Karachi in the minds of foreign investors, tourists and the whole world in general. Whod want to visit a city where violent strikes are a norm, let alone invest some needed monies?
So what can be done? An October 2012 study by the United States Institute of Peace (USIP) claims, "Karachis tragedy is that the political actors tasked with stabilizing and running the city are the major destabilizing forces."
And therefore, the USIP prescribes political negotiations for representative politics as a solution.
Besides this, strengthening of public institutions, and the criminal justice system, providing employment and educating the youth are also measures which may seem idealistic in the current context but are still pretty much required.