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August 14, 2019

1947-2019: How golden geese turned into white elephants


August 14, 2019

LAHORE: On the 72nd Independence Day of Pakistan we, as a nation, must take it upon ourselves to do some soul-searching on what we have gained and lost since our emergence on the map of the world as a sovereign country in 1947.

Though, moving forward in our journey to this point, we made headway on the economic front but at the same time we failed to maintain the potency of some truly strong institutions inherited from the British.

The quality of growth was commendable in the first two decades. With an accelerated expansion of our industrial sector that started from the scratch Pakistan become one of the fastest growing economies of the region in the 60s.

We increased our per hectare production of all the three major crops, i.e. wheat, rice, and cotton. We build the Mangla Dam during that period. We added hundreds of miles of canal network in our irrigation system. During that period was also laid the foundation of industrial revolution that never materialised, sadly though.

The country is the same as inherited from the British. The people are also the same but the promise this country showed in the first 20 years of independence is not the same anymore. It would be worthwhile to analyse as to what went wrong that derailed our growth.

This country, even in infancy, provided a loan to the war-ravaged Germany during its reconstruction phase. Let’s try to find out how things worsened to the point that it has become impossible for us to survive without foreign loans.

In 1947 we were one nation united in our endeavor to take the country to forward. In 2019, this nation stands divided ethnically, regional, religiously, and sectarianly. We accommodated the largest migrant force in the global history that was resourceless at the time of independence.

There was a comradeship between the migrants and locals. Each was truly proud to be a Pakistani.

They were burning with the desire to show to the world a penny less country could move ahead drawing strength from unity, dedication, and hard work.

It is not hard to find as to why we succeeded in our initial years. The main reason was the bureaucracy was honest and dedicated. The police were not corrupt to the core. Incidences of police excess were few and far between. People respected the law of the land.

The crime rate was very low and criminals were mostly apprehended and convicted through courts.

The lower courts were efficient and disposed cases without delay on daily basis. The judges stayed away from social parties or media. The bureaucrats were dutiful and competent. Red tape was not heard of and the tax collectors were collecting enough revenue to run the country. The businessmen were patriotic.

Habib Bank Limited, owned by the House of Habibs before partition, boosted the salaries of federal government employees for quite some time. Isphahanis financed the entire expenditure of Pakistan’s embassy in Britain.

Railway was the main mode of goods transport for over twenty five years. It was efficient and very cheap compared to road transport (it would still be very cheap if run competently and efficiently).

We destroyed the efficiency and operations of Railways after turning it from a golden egg laying goose to a white elephant. The incompetent railways department increased the transportation cost tremendously as consumers were forced to shift to road transport. The impact was not felt by businesses initially when the fuel prices were very low but as the global petroleum rates increased the difference between rail freight and road transportation multiplied.

Currently the cost of 20-feet container from Shanghai to Karachi is much lower than the freight of a truck from Karachi to Lahore as Railway wagons are mostly unavailable.

The cargo handling at ports was exemplary in early years of independence, now we have most lethargic and corrupt customs department. Cargo handling even in Bangladesh is more efficient than ours. The central board of revenue (now Federal Board of Revenue) was not plagued with corruption. The businessmen dared not avoid their due taxes.

The economy was increasingly moving towards documentation. Smugglers and those indulged in under-invoicing were regularly apprehended and were afraid of raids from tax collectors. All this looks like a dream in 2019. The level of corruption is at a peak and smugglers are the most respected citizen of the country.

Public sector enterprises were an example for the private sector. In fact in order to lure private businesses to enter new sectors the federal government established state-of-the-art industries from its own resources and after operating profitably for some time handed them to the private sector after competitive bidding, recovering all the government investment.

Today the public sector companies are a curse for the state, bleeding the exchequer to the tune of Rs1500 billion annually. Our country is now hostage to weak and corrupt institutions. People will continue to suffer till the transparency and spirit that reigned supreme after 1947 is restored.