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The economy of Pakistan Dr Tanvir Hussain Bhatti Thursday 20, September 2007 Source: THE POST Opinion Poll
Do you agree inequality threatens S Asian stability? YES NO

Since the inception of Pakistan, those at the helm of affairs intoxicated by power, always turned a blind eye to the national concerns and public welfare. Today, the national economy has sunk into a state of inertia due to the ad-hoc policies of the fact-twisting myopic top cats. President Ayubs industrialisation and Basic Democracy (BD) were cast aside with his ousting. Zulfikar Ali Bhuttos nationalisation and land reforms were abandoned after his hanging. Ziaul Haqs Islamisation crashed in the air. The development strategies hatched by Benazir Bhutto and Nawaz Sharif were thrown out of Pakistans borders with their exile. The outcome of the enlightened moderation, devolution plan and successive progress plans pioneered by the current regime have not been very dissimilar from those of their predecessors. Throughout the 60 years political history of Pakistan, the governments considered it their responsibility to brush aside the policies kicked off by their forerunners. The consequence of this frog-in-the-well-navigation of the cooties is that there has been no continuity of development plans, which is gravely tattering our economy. Pakistan has made some steps forward, but at a snails pace since its birth. Foreign aid and assistance funnelled by the donor agencies and developed countries acted as short-term measures to give boost to an ailing economy. Even the transitory swiftness of the growth rate achieved by foreign assistance, a chunk of which has been provided by the US, could not give any advantage to the common man in the street. With the economic growth at 7.0 percent in the current fiscal year, the economy has grown at an average rate of almost 7.0 percent per annum during the last five years. This rapid pace of expansion on a sustained basis has enabled Pakistan to position itself as one of the fastest-growing economies in the region. But due to the concentration of fruits of economic growth within a few hands, the monetary planners have failed to translate this boon to trim down poverty. By the 1990s, it was acknowledged that growth alone does not diminish poverty and a more direct approach is needed. Periods of economic growth have been disrupted by long durations of economic stagnation. Perceptual budget deficit and trade shortfall resulting from failed monetary policies forced Pakistan to ask for the International Monetary Funds (IMFs) help. The country is currently entangled in a heavy debt trap of $ 38.86 billion that has hampered the national economy. Corruption is acting as a blight to ruin our monetary system. Black money generated through the black economy is transferred to foreign banks. The apple-knockers have been transgressing all bounds of decency by looting national wealth. This reckless dishonesty has been blocking the transfusion of cash into indigenous industry. Rampant corruption has permeated all spheres of our national institutions, thus the economic benefits never trickled down to the common man. The social and political turmoil, the law and order situation, unchecked smuggling, uncontrolled hoarding, market manipulation by the big guns, and shutter-down strikes triggered by the business community have further destroyed the already tightly-squeezed economy. Energy is necessary to fuel the power-hungry industry. Pakistan is passing

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through a phase of severe energy crisis because no major dam has been constructed for more than 30 years to tap the countrys hydroelectric potential. The gap between the supply and demand of electricity has touched 3,000 megawatts. Lack of national consensus and deficiency of mutual trust among the constituent units are the major stumbling blocks in exploiting water resources to meet the challenges of energy shortage. Inflation is mounting. According to the Economic Survey 2006-7, inflation is as high as 7.9 percent, well in excess of the 6.5 percent target. What is particularly nerve-racking is the considerable growth in food inflation. While everyone in the commercial food chain, i.e. the growers, livestock owners, wholesalers, and retailers can tailor their priorities to inflationary pressures, no such alternative is available to the consumer. Political stability is imperative for economic stability. Pakistan has failed in its quest to emerge as a developed country on the economic map due to uninterrupted political chaos. Frequent changes of governments have wrecked the chances of a democracy that can act as a springboard to provide viable hope for social strength, political steadiness and economic vibrancy. Japan and Germany rose phoenix-like from the ashes of World War II. Now they have become economic giants due to their resolute national spirit and political strength. China, with $ 1.3 trillion has the largest foreign exchange reserves in the world. It has become an economic giant due to indomitable will of Mao Zedong. It is forecast by the distinguished think tanks that China can challenge its political and economic rival, Uncle Sam, in the next 50 years. Therefore, the US has adopted a policy of containment to impede China. The situation is quite different in Pakistan. Those in the corridors of power escape from liabilities while extracting maximum benefits by using their authority. Even unemployed educated youth avoid doing a menial job. When these people get a golden opportunity to migrate to the developed countries, they work there happily on a store or a hotel, etc. The beans of patriotic sentiments are vital to invigorate civil society to ensure its meaningful participation in all walks of life. Human resources are the true assets of a nation. Therefore, there is pressing need of human resource development in Pakistan to give a boom to the national economy. The public can contribute substantially in the states prosperity. Ironically, patriotism has been deliberately crushed in Pakistan by the vested interests. Contrary to the developed nations, personal interests are given priority over national interests in our country. Caste is given preference over patriotism. Regional language is considered superior to the national language. Sectarianism is propagated more vigorously than the real Islam. Regional leaders prefer provincialism over federalism. Is it possible for such a fractured population to compete in the comity of nations? Can such a divided community come to a single point through a consensus to resolve complex national issues, which are crucial to make progress? There must be a fair distribution of resources and uplifting of the socio-economic status of the people to ensure their full contribution in national productiveness. A host of remedial measures like fair collection and distribution of zakat, true empowerment of women to guarantee their significant involvement in various institutions, provision of technical education and micro-credit facilities to the unemployed, redistribution of land among landless farmers through land reforms, mobilisation of domestic resources, easy availability of loans to the peasants, formulation of effective programmes to curb poverty, and socioeconomic reforms at the national level can reduce the widening gulf between the prosperous and the poor. A long-term economic policy is the need of the hour. It is mandatory to develop indigenous self-sufficiency, which is vital to ensure economic independence. Foreign aid should be utilised for beefing up a local industrial base. Economic self-reliance can liberate our financial system from the tentacles of donor agencies that always have their own axe to grind. The agriculture sector is the main source of livelihood for 66 percent of the countrys

population. It accounts for 20.9 percent of the GDP and employs 43.4 percent of the total workforce. It is the backbone of our economy. This segment faces numerous problems that must be resolved. The law and order situation must be improved to ensure considerable foreign investment and to attract tourists. Alternative energy resources must be tapped to fuel the powerstarving industry. The black sheep involved in hoarding, tax evasion and grafting should be dealt with an iron hand by establishing impartial and powerful accountability institutions. The media should play a constructive role to indoctrinate patriotism in the public. Only then will Pakistan truly develop.

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