February 3, 2012 was supposed to be a normal day for 42 street vendors located in Islamabad 1-10. The street vendors were required to set up their stalls, and then prepare to sell their goods to passersby.
A regular Friday quickly turned into their worst nightmare. The bulldozers came up at 3:00am in the middle night and razed the carts to the ground. They left behind a pile rubble. Other carts were also confiscated by the municipal administration. Vendors who did not comply were beaten. This draconian act of the city government saw 42 families lose their livelihoods in a matter of minutes.
This is not an uncommon occurrence. Street vendors are an important part of Pakistan’s informal economy. It is estimated that there are more than one million of them. Despite their widespread presence, they are often not licensed or regularly registered, and there is uncertainty about their future.
They remain at the mercy of city governments’ mercurial, anti-poor ‘anti-encroachment drives’, and work under the looming shadow of extortion, evictions, and abuse by extractive powerful elements both in the market as well as in the government system. They will pay any type of illegal rent to support their businesses. Political patronage furthers the collusion within this space. Yet what was different about these I-10 vendors was that they were, in fact, regularized and licensed by the city government as part of the ‘Ehsaas Rehribaan’ initiative.
Back in April 2021, the federal government attempted to bring street vendors within the fold of the formal economy through Ehsaas’ livelihood building the Rehribaan Initiative. This was premised on the recognition of these vendors’ massive untapped potential. Street vendors are a great way to create jobs and income for low-income families. These street vendors have the potential to bring billions to our national exchequer. In Islamabad alone, 20,000 vendors could generate between Rs36 and Rs43 billion in government revenues.
Ehsaas Rehribaan, a pilot program to tap into this potential and create an enabling environment in Islamabad for street vendors, was launched. Each vendor received a license to vend, based upon a PIDE field survey. Each vendor received new vending carts with solar system and modular systems, which were sourced from microfinance loans. These carts were placed in designated areas within commercial areas. The Ehsaas umbrella outlined the basis of the initiative. It was based upon a formal MOU between CDA, Ministry of Poverty Alleviation and Social Safety and the Metropolitan Corporation Islamabad.
We drew inspiration from governments around the world that are trying to make street vendors an integral part of their urban economies when designing this program. The historic 2018 rule by the Los Angeles City Council to regulate and legalize street vendor operations in the city will benefit more that 50,000 street vendors. To regulate more than half of the street vendors within New York City, the New York municipality issued an additional 4,000 street vendor licences in 2021. To boost the local economy, Chengdu issued 36,000 street vendor licenses during Covid.
The remarkable results of the pilot Ehsaas Rebiban initiative were impressive. The city government generated Rs4.8 million in revenue from vending license fees, which enabled over 200 street carts to be placed in four areas of Islamabad. This initiative drove capital investment of more than Rs20 million and a monthly turnover of approximately Rs30 million. Street vendors were able to create dozens of jobs by hiring staff to run their businesses.
These statistics can’t capture the human impact of this program. A widow, selling biryani and channa chat from her 2’x 4’ counter, could now expand her business without the anxiety of constant harassment by the authorities. This allowed her son to attend a better school. The garment vendor didn’t have to worry about his wares being stolen at night or getting damaged in the rain. He could lock his modular cart, and go to sleep at night. He was confident that his new license would allow him to invest in a new glass display and protect him against eviction.
It is impossible to justify what the city administration did last Wednesday. Instead of renewing the vendors’ one-year licences, they reneged on their commitment to them, which is a betrayal that has eroded the market’s trust in the local government. This wanton disregard for poor vendors’ livelihoods will have lasting negative consequences. Up to 60-70 per cent of vendors’ inventory and an estimated two months’ worth of income will be lost. There will be no jobs. Microfinance loans will not be extended to the poorest street vendors. All investments made will be canceled. Street vendors will be driven back to the predatory world unregulated vending.
At a time when households are struggling due to record inflation, destroying street vendors’ source of income is cruel and unwarranted, and the resulting loss of government revenue is unjustifiable. The city administration must immediately stop the destruction of property for anti-encroachment. Both the ministry and the city administration must pay the vendors for the damages they caused and restore their licenses. Political rivalries should not cause collateral damage to the poor.
The writer is a senator who was formerly a special assistant to Prime Minister.
Minister for poverty reduction and social security
She tweets @SaniaNishtar