The dust over Ashura violence hasn settled yet. More than 50 hours after the riots set buildings ablaze, smoke still billows beneath the heaps of charred merchandise scattered across Karachis commercial and trading centre.
Who caused these huge losses to traders is now known, i.e. if Taliban don go back on their word. But perhaps, what one would never know is the precise quantum of loss. While the loss of those who departed can be measured at all, the loss of goods & stock-in-trade and the businesses as a whole are also at best an educated guess.
Anjum Nisar, former chairman of KCCI and currently a member of the committee formed to manage the crisis, puts the figure at Rs30 to Rs 40 billion. But thats at the least" says Nisar who has termed this weeks mayhem as Pakistans 9/11.
Improper documentation, dominance of old school accounting methods - such as single entry system - in many places, and a serious lack of data warehousing for backup purposes makes the job of a loss assessor a difficult one.
One thing, however, is relatively more certain: the economy has been shot at a point blank range and that the impact of this bleeding jugular vein will be felt for a long time.
Unlike the industrialists, who lost about Rs10-12 billion in the aftermath of Benazir Bhuttos assassination, traders sitting in Karachis commercial hub aren insured mostly because of their religious beliefs.
This essentially means that their entire inventory, assets, including cash-in-hand (which often runs in millions) enveloped and hidden inside the shops have been simply lost, with no hopes of return.
The government says it will help traders stand on their feet again by setting up a Boulton Market Fund. PM Gilani has already committed Rs1 billion as the initial package.
But considering that it failed to live up to its promises after the assassination of Ms. Bhutto and the plastic market conflagration a few years ago, its too early to expect that governments commitments would materialize. Especially not, when the government itself fears to have been ditched by its Friends, creating more worries for the finance minister.
And these are, of course, just the more immediate issues. Once traders come out of the trauma, they will have to fret over how to match their debts and obligations and how to relocate elsewhere from damaged buildings considering that proprietorship structure is mostly loosely drafted, while ownership of many shops is also ill structured under the age-old pagri system. Meanwhile, tax revenues for the government might fall especially in the light of likely tax relief reportedly agreed in principle; consumers might retreat and so will their borrowings, while prices of some items within the inflationary basket may tick upwards.
Yet, amidst all this mess, investors at the Karachi Stock Exchange seem to be basking in the blaze of glory, sending the benchmark index higher by 97 points to close Wednesdays trade at 9507.97 - its highest reading since October 21, 2009. Perhaps, the violence had already been factored in the equity prices or perhaps investors see some new light at this end of tunnel full of smoke.
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DIGITS OF GLOOM
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Estimated worth of goods burned Rs.30 - Rs.40 billion
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Number of shops on blaze 4000 - 4500
Of which:
Completely charred 3000
Partially burned 1000 - 1500
Number of cabins 400 - 500
Workers per shop 5
Workers rendered jobless 20,000
Daily wage earners 4000 - 5000
Number of families affected 24000 - 25000
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Total number of lives directly affected * 120,000 - 125,000
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* = assuming 5 members per family
Source: KCCI, Alliance of Market Association, BR Research
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