Pakistan Institute of Development Economics

PSL: In the eye of a Citizen

PSL: In the eye of a Citizen

Publication Year : 2020
Explore More : Blog
Keywords : Pakistan, PSL, tourism

PSL ihappening in Pakistan for the first time in 5 years. Wow. Great News. But, wait!!! Is it?

Belonging to a family where someone around is always into sports in one way or other, the most amazing entertainment in my early childhood was going to the stadium to watch a match with my dad. Over time I developed interest in sports and started playing. Fast forward, everything is going great, people are going about their lives and side by side matches are happening. Then there’s this attack on the Sri Lankan team and every sports-wise activity ends for Pakistan. Pakistan lost tourism, sports activity, and FDI, and many international banks shut down their businesses. This naturally affected Pakistan’s economy greatly.

PSL had a great start and it looked like PCB had spent a great amount of money and similarly the enthusiasm of the spectators was amazing. It surely is helping the country get back into sports. Teams from Bangladesh and Sri Lanka visited Pakistan in January 2020 and in 2019. The question arising here is what is the cost of getting the country this entertainment. I am an ardent sports lover, but there are economic and social costs to this that nobody seems to be giving any attention to them.

There are multiple aspects to this; we want peace in the country, but how long will we tolerate such events when our well-being is compromised. Movement of the teams means all routes are blocked, there are long queues of traffic and emergency vehicles are often stuck as well. These need to move to save lives but they can’t do anything other than waiting in traffic. Looking through the economic lens of a consumer it is sometimes a rip off as well. With petrol at PKR 117.89 per litre, people try to save money by turning their vehicles off rather than idling. But since no one knows when the queue will move again, they keep the engine idling and consume petrol.

Perspective two is an important perspective. Every single public place in a 2 km radius of Qadaffi stadium is closed. Qadaffi stadium Lahore has at least 12 restaurants in the surrounding areas and roughly 25 staff in each establishment. According to a restaurant owner, one day of loss for closure of stadium’s business is between PKR 2.5 and 3.0 crores. The establishment has a staff of 40, half of whom are on daily wages ranging between PKR 900 – 1,200. If the employee won’t take anything home in all those days throughout the PSL, how is he going to feed a family.

The PSL is a month long event and if restaurants don’t operate for half that time, that means an average loss of PKR 45 crores. This is borne by the businesses in the stadium alone. On average, we can expect the salary of a daily wage employee to get halved. The same scenario can be expected at Hafeez Center as well, yielding to a conservative guess of PKR 5 crores per day loss. This is a huge loss for even 15 days of the event happening in the city. All other small and medium businesses and their losses aside.

These calculations are only for Lahore, but we should expect similar estimates for other cities where the PSL is held. I think we can safely assume that during such events the business community is going to bear loses of roughly PKR 150 crores.

Just to be clear, nobody is against entertainment and tourism, but it is also important to check their opportunity cost. Government and city management should make sure their security systems are secure enough without making the average citizens’ life difficult. Tourism activity should increase, but not at the cost of the daily and economic life of people.

P.S. This piece reflects only on PSL and no other activities for now but every other such activity happening in these spaces is likely to bring about similar losses. Also, I might go watch a match.