Power Shortages Crippling Pakistan's Economy

Energy shortages across Pakistan are crippling the country's economy and costing businesses millions in lost productivity.

Electricity is cut off for hours at a time, fuel is rationed at filling stations and people are forced to run expensive generators to keep their homes lit.

Pakistan is not producing enough power to meet the growing demand and economists estimate the shortages are shaving 2% off its gross domestic product.

At one time most of the world's hand-stitched leather footballs were made in the town of Sialkot in the Punjab.

It is still a profitable business, but only just.

The power cuts keep production lines idle for hours at a time, orders take longer to make, some have to be flown abroad at great expense to make their deadlines rather than shipped.

"The energy crisis has been here for the last five or six years but it has become very severe over the past couple of years, very very severe," manager Ali Sheikh told Sky News.

"At times it is as if the government is trying to shut industry down altogether. It seems deliberate at times."

Add to that rising unemployment, a negligible tax collection rate, rampant corruption and a security situation that puts buyers off from travelling to Pakistan.

Businessman Asad Bajwa believes many foreigners are now reluctant to visit his factory in Sialkot and orders are down 40%.

But do not write Pakistan off just yet, one leading economist says.

Dr Rashid Amjad , the Vice Chancellor of the Pakistan Institute of Development Economics in Islamabad, said: "The bottom line is we need to revive growth as soon as we can.

"The government has to give it the highest priority and go in for serious economic thinking to ensure macro-economic stability.

"But I still come back to the basic fact that there is a resilience in its people and a resilience in its economy.

"Everybody thinks Pakistan is going to collapse - it never has."