Muneeb ur Rehman

Technology has revolutionised almost every sector of the economy. Bringing technological advancement to the informal sector of Pakistan is necessary for growth, said Maroof Ali Syed, CEO of Centre for Economic Research in Pakistan (CERP), while talking to WealthPK. “Informal retailers need to align their businesses with technological advancements. Digital marketing through the social media is an emerging trend around the globe, having the potential to connect buyers and traders in the informal sector,” he said. “Karyana (retail) and grocery stores can supply their products to homes through online interaction. The transaction cost of transportation that the customers have to bear otherwise can be averted,” he added.

Underscoring the importance of technology, he said it not only facilitates cash transfer but also gives the retailers data on the sales of a particular product. The retailers can further demand the products accordingly. “Many proprietors in the informal sector still rely on the manual methods to track inventory, which is challenging for them to assess sales and buyer’s preferences,” he said.

According to the Pakistan Labor Force Survey, 69% of the total labor force is absorbed by the informal sector. In this regard, digital literacy among the masses is the first step, he emphasised. “Pakistan is among those developing countries whose progress towards digital literacy is still in its infancy. With greater awareness about the use of technology, more effective will be the impact of technology on the economy.”

Maroof Ali said a digital ecosystem needs to be in place. Broad-based access to the internet is the missing puzzle that creates hurdles to realising the full potential of technology. Pakistan has a large base of customers having accounts on social media platforms such as Facebook and Instagram. Uninterruptible provision of the internet can increase the sales of retailers once they start using the technology in their businesses. Informal sector constitutes a large part of Pakistan’s GDP, providing the basis for the livelihoods of many households. The government needs to devise policies to facilitate the use of technology in business practices.

Credit: Independent News Pakistan-WealthPk