Key takeaways
- Logistics costs are about 18–20% of GDP in Pakistan, versus about 14% in Vietnam.
- Backup generation raises industrial production costs by 20–30%.
- Digital infrastructure gaps hold back freelancing and IT exports.
- The burden is regressive: the rich buy private substitutes, the poor cannot.
- Infrastructure should be judged by performance and connectivity, not ribbon-cutting.
In this Minute Mirror column (December 2025), Dr. Ghulam Mohey-ud-din describes poor infrastructure as an invisible tax: a cost every household and firm pays daily that never appears in the budget.
The argument
Transport is the largest part. The column estimates Pakistan’s logistics costs at about 18 to 20 percent of GDP, roughly double the level of efficient Asian economies; Vietnam’s are about 14 percent. Slow roads, congested ports and unreliable freight raise the price of everything that moves.
Energy is the second part. Unreliable electricity forces industries to run backup generators, which the author estimates raises production costs by 20 to 30 percent. Digital connectivity is the third. Weak broadband and patchy mobile data hold back freelancing and IT exports, the fastest-growing parts of the economy.
The burden is regressive. Wealthier households and firms buy private substitutes: generators, water tankers, private transport and security. Poorer citizens absorb delays, outages and higher prices. Meanwhile policy attention goes to IMF programmes and tax collection, which address symptoms rather than the structural drag.
The column also criticises how infrastructure is chosen. Spending tends to reward visible construction rather than performance: whether a road connects markets, whether a grid actually delivers power, whether a transit line carries enough people.
What needs to change
- Treat infrastructure as core economic reform, not ceremonial development.
- Build integrated systems that connect producers to markets.
- Stabilise power transmission and supply for industry.
- Invest in mass transit and digital connectivity.
- Evaluate projects on performance outcomes rather than construction milestones.