Pakistani Street Vendors: Pillars of the Economy

The street economy (SE) in Pakistan is part of the informal economy because it is mainly unregulated and unregistered. Moreover, the street vendors toil without the benefit of rights, legal protection, stability, healthcare, or recognition of their contribution to society. 

Pakistan is rapidly becoming a country that leaves little to no room for the poor. The public has a negative perception of street vendors, local authorities make their lives insufferable, and urban planning does not include them. As Dr. Sania Nishtar, former Special Assistant to the Prime Minister on Poverty Alleviation and Social Protection said, “The marginalised segment of street vendors is an integral part of the local economy, which cannot be wished away in a low-income country like Pakistan.” 

Importance of Street Economy

In a country where joblessness is rampant, PIDE estimated that street vending can create 20 million jobs. The Labor Force Survey 2020-2021 highlighted that a new graduate has a one-third chance of getting an opportunity to work in the informal sector. Moreover, an estimated Rs 36-43 billion is generated in revenue through street vending.

What the privileged class of Pakistani society forgets is that the country cannot survive without street vendors. Dr. Anwar Shah, Associate Professor at Quaid-i-Azam University, whilst presenting his paper during the Pakistan Institute of Development Economics (PIDE) Research for Social Transformation and Advancement (RASTA) conference, explained, “Khokas (small vendor shops) are one of the key segments of the informal economy in Pakistan as they provide jobs to many people and facilitate consumers in doing various types of transactions.” 

The reasons for keeping the street economy alive in Pakistan are countless. The street economy provides livelihood to millions of people from low and middle-income groups in the country. Street vending allows vendors to earn while avoiding some expenses. A street vendor explained, “We don’t have to pay rent or electricity bills for our shop and since we are doing this alone, it saves us money since we don’t have to pay salaries to those working for us.”

 Street vendors are an important part of the supply chain of products and services as they not only sell products/services at affordable prices to their customers directly, they supply their produce/services to retailers too. Unlike many shops, street vendors quickly adapt to changing conditions (flexible timings and moving between locations) which benefits their clients. The street economy represents the true heart of Pakistan, its history, and its culture. Street vendors bring about a certain vibrancy in urban settings.

The prejudice towards street vendors displayed by the privileged class is unbased. Dr. Nadeem ul Haque, Vice Chancellor of PIDE, rightly remarked, “I find it strange that there are street vendors within a stone’s throw of the White House, the Congress, and Washington DC landmarks and none on Constitution Avenue Islamabad. If hawkers hang out near Buckingham Palace and the Parliament, why can’t there be khokhas next to the Governor’s House, Gymkhana, Punjab Club, and the Corps Commander house in Lahore.” 

Problems Plaguing SE

Street vendors enter the street economy due to fewer entry barriers, and no requirement for education, licenses, or big capital but they are burdened with many issues. Despite working most of the day, most street vendors earn less than those working jobs in the formal sector of the economy. They are constantly on the look for raids, public backlash, and harassment by the authorities. Many of the vendors have to pay rent to shop owners to set up their carts on the shop owner’s properties. As a result, they are exploited or threatened with eviction. To protect themselves, they have to bribe the police of the area but it is not always a foolproof plan. Under pressure from elites, police often turn on them by evicting them, confiscating their goods, or causing destruction to their products.

Street vendors are persecuted for working outside the legal framework but what the authorities fail to mention is that there is no working legal system in place that allows them to obtain the right documentation. In Pakistan, it can largely be attributed to the political situation. Noman Ahmad and Muhammad Nasir, Dr. Faiz Ur Rehman, while presenting their paper titled ‘Political Dynasties and Local Economic Development in Pakistan’, elaborated, “While there can be several reasons for exasperating inter-regional inequality across regions, political institutions and politicians may explain a significant size of this inequality. Politicians exercise considerable de facto political power to redirect resources towards their regions which has a substantial cost for least developed region.”

Government’s Approach

Harassment and violence by local authorities and privileged citizens are a common occurrence for street vendors. When the community voiced this complaint during the first street vendor assembly in Islamabad, 2019, Syed Zeeshan Naqvi, Deputy Mayor of Islamabad, proposed, “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”

Such suggestions are unrealistic as the opportunity to film such incidents does not always present itself. Digitization is taking over in different spheres of life but not every street vendor has a cellphone, the know-how of capturing a video, or a camera always on standby. Moreover, filming local authorities’ brutality is a sure way to invite further barbarity.

Ehsaas Street Hawkers’ Initiative has the potential to be a more promising pathway to ensure the protection of the rights of street vendors. In 2020, the government was preparing a legislative bill to outline said rights. The draft outlined that every street vendor would need a license to operate which they could obtain for Rs. 500 per month. The license would be for 5 years, and the ownership would remain the same once it was issued. The bill maintained that children under 14 years of age would not be allowed to work as street vendors. If any street vendor would be caught in violation of the bill, their products would be confiscated, and would only be given back after settlement. If authorities confiscate the materials without giving the right reasons, personnel will be fined Rs. 20,000. Under the initiative, around 200 vendor licenses have been given out to vendors operating in Islamabad.

Ehsaas Rehribaan Initiative has provided several vendors with eco-friendly carts in certain sectors of Islamabad. Street vendors acquired them via microfinance loans or by purchasing them. The initiative also specified a quota for women and transgender people vendors.

The initiative is already reaping the reward because as of January 2022, it has gathered Rs 3.5 million in license fees, Rs 17.5 million in capital investment, and Rs 11.5 million in loans for the carts.

Smart and inclusive cities are the need of the hour. Inclusive urban planning and consequent development would result in creating a space for all segments and members of society. Apart from inclusivity of all economic classes, the government ought to implement policies that outline the rights and laws concerning the street economy.