Incessant economic drain, rationality and unravelment

Muhammad Asad

Pakistan’s economy is marred by multiple issues relating to economic policies, administrative and planning hitches, interstate trade frameworks, and regulations governing local and foreign investment in the country, and above all business priorities of the ruling elite proved to be fatal for the country’s overall economic outlook over the past decades.
The South Asian nation had an inherited agricultural economy that had been built on the world’s largest irrigation system funded by the world bank under Indus Water Treaty (IWT) in the 60s. However, the successive governments could not maintain, grow and expand that valuable infrastructure while improper irrigation practices and salinization rendered millions of acres of land uncultivable and barren. At the same time, the giant of housing societies gulped up a huge chunk of Greenland and pitched up residential buildings and business districts in most parts of the country. Thus, a grain-sufficient nation turned into a food-deficient state over the past years.
Similarly, Pakistan has seen a model of economic growth and industrial development in the world because the newly liberated country was growing at the pace of over 6% per annum in the 1960s and many nations like South Korea, Malaysia, and others sought to replicate Pakistan five years development plan to set their economy on the right track. Multiple Pakistani industrial giants were expanding their businesses and investment in other regional countries including Iran, Sri Lanka, Indonesia, and Singapore. Awfully, this impressive growth was smashed down by the recipe of nationalization and increasing government grip over private businesses that not only disturbed the pace of development but promoted corruption and nepotism in the country.
Later, the economy somehow recovered through deregulation, foreign aid, and the inflow of foreign remittances from expatriates in the Middle East and European nations but that positive development put an insignificant impact on national growth because over three million Afghan refugees entered Pakistan in the wake of the Russian invasion of Afghanistan. After the 80s, Pakistan’s economy gradually witnessed a turndown and could not maintain its above 6 % growth rate due to persistent fiscal and external deficit issues despite multiple fruitless efforts for the privatization of national entities and liberalization of economic policies, prompting a rapid increase in poverty and a continuous decrease in the pace of national growth. Thus, the longtime 18% poverty took jumped to 34 percent in the late 90s which has now touched over 43 percent in recent months.
According to analysts, no control over rapid population growth, failure in the construction of major hydel power projects, and mismanagement of the energy sector led the nation to a prolonged power shutdown which destroyed the industry, reduced exports, and rendered the public vulnerable to unaffordable inflation. Currently, the country has reached the brink of an economic collapse, and our foreign reserves hardly cover two weeks of imports even then government’s economic team is unable to conceive such a scheme that helps navigate the nation out of the current crisis and set the economy on an upward direction.
The Pakistani nation is in doubt regarding the talent and abilities of Pakistani economists, bureaucrats, and political leaders who steered the country in the past and still ruling the nation, as the prices of each and every item of daily use including wheat flour, onion, potatoes, and tomatoes, fuel and gold rates all are comparatively much lower in regional nations than Pakistan. Interestingly, the current statistics had been the same since beginning of the past year, well before the superfloods in the country. Although each ruling party accused predecessors of making up for the catastrophe but multiplied the problem through insane policies and poor governance during their term in office.
In fact, no government steered the economy on economists’ advice rather politically motivated policies and decisions were imposed by advisors and ministers who promote their character and hurt the nation in the long run. A nation where appointments are made on political affiliation, religion, or sect instead of experience and ability, where politicians, bureaucrats, judges, and generals’ scions are by birth entitled to their ancestors’ position. Institutional degradation and nepotism could not be completely weed out from those nations because personalities are cartels become more powerful than the state, and the constitution.
Realistically, Pakistani politicians had always tried to resolve economic and administrative issues through political wisdom by give-and-take formulas and power/profit-sharing mechanisms that harmed the national economy and caused serious legal and financial issues for the government. The present economic depletion is the outcome of decades-long politically motivated economic decisions that promoted politics but wasted valuable national exchequer on wrong and misleading priorities. Therefore, until and unless, Pakistani leaders segregate their governance from politics the nation can not survive such recurrent setbacks, and our national prestige would always on the mercy of donor nations and global lenders.
Writer is a journalist, military veteran and former Diplomat. He can be reached @Asad_FP.