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The News on Sunday: How did the idea for writing this book evolve?
Jamil Nasir: Initially the idea was to write a book on economic development in Pakistan by building upon my earlier papers and articles. However, during the research, it was felt that informed literature on the subject is scant and whatever literature is available, takes a short-term or medium-term approach to analyse the socio-economic problems of Pakistan. It was in this context that I embarked upon the journey of writing this book.
TNS: It is quite a voluminous book. How long did it take to write?
JN: It took quite long, almost five years. I am not a whole-time academic. I have a hectic public sector job for my livelihood. It was not possible every day to take out time for writing. Most of the work was done on Saturdays and Sundays. I had started working on the book in 2019; it was published in July 2024.
TNS: What academic discipline do you believe the book really belong to?
JN: Well, the book is multi-disciplinary. It mostly takes a political economy approach to analyse development challenges of Pakistan. The Journal of Economic Literature and Econlit have listed it under economic development.
TNS: How does it differ from earlier books on this subject?
JN: Some good work on the economy and development challenges of Pakistan is already available. However, that is mainly focused on short-to-medium term public policy issues confronting Pakistan. Development Challenges of Pakistan is about the long term. Also, it is not essentially about numbers. Rather, it is about the factors and structures hidden beneath the numbers.
TNS: What are the main areas covered in the book?
JN: Well, the book has 15 chapters and three case studies. It starts with a discussion on the primacy of inclusive economic growth for development. The emphasis throughout the book is on the deep nexus between economic growth and equity. The two are deeply linked and complement each other. Long-term sustainable growth is not possible if its dividends are not widely shared. After making a case for economic growth and equitable distribution, the book explores education, public healthcare system, inequalities of structural nature, poverty, rural economy, skewed land distribution, poor performance of public sector and the noisy legal system.
TNS: Is the low spending on education the reason for the poor quality of education and the high number of out of school children?
JN: Perhaps the low spending narrative is not the whole truth. Per pupil expenditure in all provinces is higher in public schools than low-cost private schools. However, the outcomes in the private schools are, on average, better than public schools. Some of the public schools are built over acres of land while low-cost private schools are operating in 10 to 15-marla houses. If the opportunity cost of the land is accounted for, per pupil cost will turn out to be much higher. The problem of the out of school children is partly linked the nature of education and curriculum. We are not imparting skills that can help the children earn livelihoods, so the poor have no incentive to send their children to schools. Moreover, sending the children to schools has an opportunity cost. The children of the poor are often earning for the family. Even a child begging on the street is adding some money to the total earnings of the household. The problem of the out of school children cannot be addressed until the opportunity cost of sending the children to schools is taken into account. Policy measures like free mid-day meals in schools, besides connecting curriculum to livelihoods, are required to address these issues.
TNS: What kind of interventions are needed to improve the healthcare system in Pakistan?
JN: Three areas need to be addressed before everything else. First, the promulgation of a policy making it mandatory on the physicians to prescribe generic medicines. Medicines are becoming highly unaffordable for the poor, even the middle class. In 1970s, a law was passed to support generic medicines. It was later on scrapped due to resistance from the pharmaceutical companies. Second, village dispensaries need to be digitally connected to big city hospitals and DHQs. Third, access to healthcare should be declared a fundamental right enforceable by courts of law. Covid-19 sufficiently proved the public good nature of healthcare.
TNS: Inequalities exist in every society. So what is so wrong with inequality in Pakistan?
JN: Inequality and inequities are the common threads that connect various themes covered in the book. Thanks to economists like Stiglitz and Piketty inequality is now under the microscope as an economic challenge. The worry in Pakistan’s case is that as per World Inequality Database, the Palma ratios are almost the same since 1980s. This means that the nature of inequality in Pakistan is structural. It is due structural rigidities that intergenerational mobility is very low in Pakistan.
TNS: What can be done to reduce inequality in Pakistan?
JN: Introduction of death and wealth taxes, reallocation of property rights through land reforms, distribution of state land among the landless and prioritising focus on human resource are some of the policy prescriptions that can be helpful in reducing income inequality in Pakistan.
TNS: You talk about taxation but a vast majority of the people do not pay taxes in Pakistan. How can we expand fiscal space for poverty alleviation in such a scenario?
JN: This narrative is problematic. In a country where nearly half the population is living below the poverty line, direct taxes are paid by no more than 1 percent of the people. It is in the top 1 percent that tax evasion is rampant. The rich are powerful and connected. They propagate false narratives about taxation. Strong political is required to make them pay the due taxes. The role of media is important to debunk such narratives. It should initiate a well-informed discourse on such issues.
TNS: Good governance is important for economic growth. What areas should be prioritised in your view to improve governance?
JN: For sustainable economic growth, good governance is extremely important. The civil service and judicial reforms are two major areas that require immediate focus. The civil service structure needs to be reformed with a view to make the bureaucracy developmental in its outlook. Competition from outside needs be introduced at each level of bureaucracy besides improving their recruitment and training structures. Assessment of cognitive skills should not be the sole criterion for recruitment. Prosociality and integrity should be equally important. Judicial reforms are urgently needed as contract enforcement is at the heart of all development and economic growth.
The author is a The News reporter