Economic myths and realities

August 16,2017

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In the lives of nations confronting multiple challenges and having faced many crises, there come times and moments that are just ripe and opportune for introspection and soul searching. Times that call for challenging stifling status quos; breaking negative stereotypes and progress-stunting inertias; and turning the corner on all the wrong perceptions. Times when a nation confronts its inner demons – of statehood, national identity and destiny or direction. Times that define the strengths and weaknesses of character of a nation.

At 70, it’s time for Pakistan, too, to not only confront all its inner and external demons, but also banish them once and for all. It’s time we wake up to the harsh internal, socio-economic, geo-political and geo-strategic realities, and do the necessary course correction.

It is time we separate myth from reality and factually build a case for a splendid country whose recorded steady economic indicators, in earlier decades and recent years, and rich socio-cultural and civilisational heritage, robust literature, arts, music and cinematic credentials, and international acclaim in many sports, all belie the negative image being consistently fobbed on it.

Pakistan today stands at a very important and path-defining juncture in its history, facing unprecedented opportunities and positive developments as well as challenges on key fronts of peace and security, and socio-economic development. It is our make or break moment depending upon what decisions we take today.

There is a lot more to this country than meets the eye, and as opposed to the image portrayed by regional and international news and entertainment media, fiction and non-fiction literature, and lately, social media. Pakistan is a victim of extraordinary circumstances, not entirely of its own making, and 'U' turns enforced by some local or global dictators as well as by a handful of 'actors and organisations' gradually multiplying in numbers and gaining overt and covert powers, who are crippling Pakistan's diverse culture and society, besides limiting its public discourse and policy options.

One of our biggest challenges is the yawning perception gap reaching dangerous proportions and dimensions. It is, therefore, time to dispel some of the unfounded doubts, apprehensions and propaganda with inward focus on our own shortcomings and self-created confusions that need to be honestly admitted if not addressed immediately.

Granted, these are testing times and that grave challenges abound on various fronts. However, annals of history bear witness to the fact that almost all nations and civilisations went through turbulent and cataclysmic times in their history – times that tested their mettle, strength and resilience; times that brought their cohesion, integrity and even existence into question.

On our 70th Independence Day, we must join hands to revive and revitalise the spirit of tolerance, liberalism, pluralism, and most importantly, pragmatism that once defined Pakistan during 60s and 70s. Instead of 'dying' for other people's agendas or enforcing our ideas on others within country and abroad, we must accept and face our chronic weaknesses and shortcomings as well as the damage we have caused to our own image by either ignorance or complicity.

We have neither flat-lined economically or socially, nor are we defined by the false image of extremism and fundamentalism – a scourge alien to Pakistani society before the US imported, planted and nurtured it during ‘Afghan Jihad’, only to grow into a tall terror-bearing tree that has now overshadowed the whole world.

When it comes to economy, there is a dire need to set the record straight, and clear certain misperceptions that have been unduly casting aspersions at Pakistan to this effect. Generally, the impression is that Pakistan has failed in economic development, and that the economic conditions have not improved at all since independence. Another perception, or misperception, is that India and other countries in the region have always been performing better than Pakistan in economic growth.

But nothing could be farther from the truth, both in comparative and absolute terms. Pakistan's current economic woes, setbacks and lapses apart, our economic trajectory and progression since independence, throughout earlier decades, and right till 90s, was quite reasonable, and, at times, comparable to, or even better than, India. That we were able to survive economically post-partition despite being poorly endowed and resourced, and separated physically by 1000 miles across a hostile territory, stands witness to Pakistan's economic resilience, perseverance and buoyancy in the face of challenges.

However, despite the visible asymmetry in economic resources, the economic growth rate of Pakistan was consistently higher than India's. Most notably, Pakistan has witnessed strong economic growth rate of 7.24% in 1961-70 decade, higher from India, Sri Lanka and Philippines, and slightly lower than South Korea and Thailand. Pakistan kept this high growth trajectory till 1990 in comparison with countries like India, Sri Lanka and the Philippines.

Pakistan is one of the few developing countries that have achieved an average annual growth rate of over 5 percent over the six decades. Per capita incomes in constant terms have multiplied four fold - an accomplishment that a few developing countries can claim.

Likewise, starting from a slightly lower level in 1947, Pakistan's per capita income by the early 1990s had risen to $430 in nominal terms, while India's was $320. In purchasing parity terms, it was two third higher ($2310 vs $1280). An average Pakistani enjoyed better living standards and consumption levels until 1990.

In terms of energy sector too, Pakistan has historically provided the facility to a higher percentage of population than India and other countries of region. Notwithstanding the reality that loadshedding of electricity is one of the biggest crises being faced by Pakistan, the fact remains that Pakistan’s ranking in terms of access to electricity has remained better than that of many other regional countries. Loadshedding is a dominating economic and political agenda and focus of all efforts of both the nation and the government. However, the fact remains that a sizable chunk of population in many neighboring states remains deprived of electricity. In 2014, 97.5% of Pakistan had an access to electricity compared to 79.2% in India.

In 1947-48, the total installed capacity of electricity was 69 Mega Watts. By investments during the following decades the physical infrastructure of Pakistan was transformed and modernised which resulted in installed capacity of 25,091 Mega Watts (with thermal, hydel and nuclear energy sources). However, worth mentioning is the electric power consumption per capita which increased from 121.76 in 1977-78 to 444.20kwh per head in 2007-08. The real point of concern here is that instead of just focusing on electric installed capacity at rising costs or opportunity cost the over consumption needs to be checked.

Moreover, even if we review Pakistan’s economic indicators and development in absolute terms, the picture still doesn’t seem too bad. In terms of agriculture, industrial and infrastructure development, too, Pakistan made considerable efforts and headway, entailing far-reaching economic dividends.

Pakistan initially started with a meager agriculture base, and food imports were made to suffice the demand. In 1947-48, wheat and rice production was 3301 and 682 thousand tonnes respectively. Subsequently, the agriculture production kept on increasing due to improved water and fertilizer availability and mechanisation of agriculture. The water availability almost doubled from 68.54 million acre feet (MAF) in 1967-68 to 132.7 MAF in 2016-17(July-Mar), which is remarkable. Production of major crops increased manifold as well.

The road and highway network in Pakistan spans 250,000km -- more than five times the length inherited in 1947. Modern motorways and super highways and four lane national highways link the entire country along with secondary and tertiary roads, and make up an important factor in spurring trade, industrial and agricultural activities.

The social indicators i.e. primary enrolment, population per doctor, literacy rate and mortality rates of past seven decades also show significant improvement since independence, although a lot needs to be done in health, education and other social sectors.

Since the revival of democracy in the country in 2008, Pakistan has endeavoured hard to address and resolve problems rooted in years of dictatorial rule and regressive short-sighted policies that strangled progress, and brought in their wake lawlessness, enduring poverty, social injustices, and systematic destruction of the foundations of democracy, state institutions, civil society, and diplomatic isolation of Pakistan.

From a long-awaited transition to democracy, to the mettle-testing challenges of strengthening a fractured federation, to consolidating state institutions, and from trials, tribulations and triumphs in the war on terror, to the much-needed economic revival, Pakistan has certainly come a long way.

Agreeing that Pakistan’s economic performance in the past seven decades has been fluctuating, and that after our better performance during first four decades, and that India has over taken Pakistan in economic growth and so have other South and East Asian countries. Agreeing that India’s growth rate averaging 6 percent for the last 15 years without any periods of decline for a diverse society of one billion is indeed highly creditable, however, Pakistan must not feel overwhelmed by India’s economic pace.

Through focused efforts, Pakistan has been able to make a comeback lately on the economic growth stage. The multi-sectoral progress, improvements and positive change being witnessed in Pakistan have also been acknowledged and endorsed internationally by globally acclaimed ranking and rating agencies, financial institutions, UN bodies and international media.

This economic turnaround despite looming challenges in itself is a promising development akin to silver lining on our economic horizon that we should rightly be proud of as a nation and as a state.

The author is secretary of Senate of Pakistan


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