Pakistan on the brink of an economic transformation?

Published December 8, 2014
Before new opportunities knock at our door, we need to build the capacity to accept them. —Illustration by Khuda Bux
Before new opportunities knock at our door, we need to build the capacity to accept them. —Illustration by Khuda Bux

Pakistan’s 67 years of suffering can be attributed to one tragic flaw: Failure of imagination.

A country so gifted with great potential, suppressed and stymied to a point where day to day survival is a herculean effort for the people and for the state itself.

A nation so full of resources and vivacity, doomed to a life of mediocrity.

A country where mediocrity is now celebrated and exceptionalism both feared and looked down upon.

Imagination liberates a people from the mundane hardships of everyday to help us plan for a better future. But a careful look at our history reveals we have barely ever thought things through. Why else do you think we use the democratic argument to undermine democracy and market dictatorship?

Not convinced? Think about how, for the past six years, a substantial segment of the country’s thriving media has stopped at nothing, reminding us that the country’s leading democrats are essentially dictators; that the last dictator to rule the Islamic Republic was much more democratic in comparison.

And that is not all.

See: Five years on: A poorer, hungrier nation

The discourse of each country has a political argument, a religious argument along with societal and cultural arguments. But the economic argument, the one most critical for survival, easily beats them all. Sadly, in the Islamic republic, even the flimsiest notion is allowed to trump the economic argument.

You want the country to thrive as a tourist destination? Sorry, can’t do, because our value system does not allow us to be competitive as a tourist spot.

You want banks to introduce venture capitalism? But don’t you know that interest (read usury) is haram?

How about women empowerment and inclusion in the country’s productivity? Isn’t it imperative that in this age of economic competition, half of the country’s population should be made part of the workforce that contributes directly to the GDP? No. You don’t you get it. How can we lose honour and let our women work?

Want to have better trade relations with the neighbours? Well, why should we allow that before the resolution of our political disputes with them. And, the examples go on and on.

Also read: $7bn debt servicing a challenge to economy

A nation that cannot pay for its meals can ill afford the luxuries of morality, independent politics, religion and a unique culture. As a consequence, the process of nation building has suffered. Owing to the disparate economic climate in the four provinces, we still lack a common thread to unite us in a collective struggle to survive.

It is time to embrace the primacy of the economic argument.

This country is so badly broken that the state hemorrhages money at every level. The incidence and persistence of corruption doesn’t help. But there are far bigger issues to contend with; for instance, the spectre of uncontrollable fiscal deficit every year.

Pakistanis show little interest in paying taxes or in demanding accountability and transparency in the use of their tax money. The state, in return, not only fails abysmally to provide welfare and services to the masses, but refuses to trim fat from its non-developmental budget.

In the absence of a coherent approach towards reform, the country’s outdated bureaucracy and governmental departments fail to put investment in the public and private sectors to any good use. Little to no development, scanty enterprising, miserable job and wealth creation and insufficient flow of money are a few results of that.

Let there be no doubt that the country stands on the brink of an economic transformation as improved connectivity with Central Asia and China will change us into a regional trade hub. It will bring wealth and great opportunities for prosperity beyond our imagination.

Read on: Pakistan can become world's 18th largest economy by 2050

But then, billions of dollars flowed in during the heyday of the war on terror in Musharraf’s rule, and vanished without a trace. When the state and society lack the capacity to absorb this much money, it incentivises corruption and misuse of funds.

Before new opportunities knock at our door, we need to build the capacity to accept them. Only then will the newly created wealth trickle down to the common man. In view of this, political parties within and without the parliament need to agree on a 10-year general framework for economic growth, stability and capacity building.

No economy can grow in an unstable political environment. Repeated military takeovers, untimely interruptions of the democratic cycle and destabilised political campaigning have decimated the chances of the country's political evolution.

As angry protesters led by a few opposition leaders and thoroughly facilitated by the country’s private media threaten to derail the process again, fears grow that lessons learnt through hard labour might be forgotten once again. This cannot be allowed to happen.

Who rules the country is not totally irrelevant, but what is far more crucial is the continuation of the process. That's what all the labour, all the sacrifices have been for.

Given that democracy is a soft power, even the country’s powerful military and judiciary need to stand unflinchingly by the process. If the democratic cycle continues uninterrupted, the end of every five year term will bring incremental maturity to the system.

The voters will get the opportunity not only to vote governments in but also to vote them out, the masses will gradually realise their responsibility and start owning their choices. Thus, slowly but eventually, the quality of their decisions will improve.

Strategically, the country has always oversold its geography, underperformed in reaping benefits of regional integration, rendering the neighbourhood extremely hostile for us. It is time to indulge less in marketing and invest more in building regional synergies.

It will not be irrational to suggest that on regional political matters, instead of projecting ourselves as regional experts, we could try to be less conspicuous for a change and try being better regional partners. Our regional disputes can wait. All we need to do for now is to harden our existing borders. Once again, the economic argument should be given prime importance. In doing so, however, attention should be given to preserving interests of domestic businesses.

Take a look: Dar eyes economy expanding at 7pc by FY18

Social mobility is another key element lacking in our society. Movement between classes is tiresome and often impossible. Quality of education, research and development facilities, access to resources, banking laws and the overall business environment, all need to evolve at a fast pace. Key stakeholders need to develop a broader consensus in order to make this possible.

Finally, a word on the need for moderation. Usually, democratic process in itself works as a catalyst for moderation. However, given our interesting history, moderation in our country needs a special emphasis from the state. Thus far, our state has invested heavily in a religious identity. This has not stopped despite the loss of over fifty thousand citizens to terrorism. The state needs to detach itself from religious matters and invest substantially in a holistic Pakistani identity.

If a broader consensus on these matters is reached, the country may realise its full potential sooner than expected.



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