Vision Pakistan 2047: Part - II

A compelling vision is the beginning of the transformation journey of a nation. A crucial, though often overlooked, second part of transformation is effective implementation. I have previously emphasized the importance of a visionary roadmap, like Martin Luther King’s ‘I have a dream’ speech, but here I delve into the essential aspect of execution that turns dreams into reality.

A ‘vision’ is a grand plan or a direction to a destination. However, a vision alone is like having a map without a car – it remains an aspiration without a practical path to success. Implementation is the bridge that connects a vision to its realization, and it is here that nations like Pakistan have failed, while others like Saudi Arabia or South Korea have succeeded in achieving economic transformation.

Pakistan's mega projects are marred by delays, disputes and cancellation. In 2018, the Asian Development Bank ranked Pakistan as having the most failed projects of any country – totalling seven out of twelve. Our public-sector enterprises are bleeding cash at a rate of around Rs1.5 trillion a year. Lack of public-sector capability is reinforced by Saudi Arabia and China demanding an alternative implementation structure than our current bureaucratic system for strategic projects like CPEC.

Another hindrance to large-scale project execution is policy inconsistency and frequent changes due to political shifts. For example, in the previous PML-N government, CPEC’s executing agency switched from the PM Secretariat to the Ministry of Planning to the Board of Investment (BOI). Each rotation brought in different faces and different policies.

The PTI government fared no better. In its tenure, CPEC rotated between the BOI, the planning ministry, and finally in the CPEC Authority. The popular thinking was that a single-window operation headed by a former military commander would overcome bureaucratic obstacles and re-start CPEC. Even that did not work.

In 2023, another attempt at economic transformation is made through the Special Investment Facilitation Council (SIFC). However, the SIFC’s mandate must extend beyond single-window facilitation to project execution. What Pakistan needs is a project implementation arm, much like the Public Investment Fund (PIF) of Saudi Arabia.

The PIF is not merely a sovereign wealth fund; it serves as a project development and investment holding company. With a substantial budget and 1500+ personnel, the PIF drives transformation projects – like NEOM, King Salman Park or digitization of public healthcare etc – at private sector speed with full backing of the government. For national transformative projects, the PIF is the interface between foreign investors, local private players and the public sector, co-opting, collaborating and implementing.

The PIF has an exceptional management team drawn from the private sector. Its direction is set under Vision2030, and governance oversight is by a sub-committee of the Saudi Council of Ministers chaired by the Crown Prince. It is private sector driven with public sector governance.

Pakistan needs a PIF-like structure that implements transformative projects in key industrial verticals like mining, technology, agriculture. Pakistan’s PIF equivalent or SIFC-Development Company would be a public-private partnership, responsible for not only implementing projects but also initiating investments and partnerships on behalf of the government.

We have successful examples of a similar public-private structure during the last term of former Punjab Chief Minister Shehbaz Sharif. Disappointed by bureaucratic delays, a series of project or programme-specific Section 42 companies were seeded by the Punjab government in power, infrastructure, and health sectors. These entities hired civil servants and private-sector operators on a commercial basis and their quick execution was one of the reasons for the government gaining the reputation of ‘Punjab Speed’.

There were fifty-six project-specific entities in Punjab, which created governance and control problems and so a single SIFC-Dev Co with an overarching governance, and sector-wise subsidiaries will give SIFC initiatives a credible implementation vehicle, plus a consistent and long-standing counterpart to the foreign investors. The SIFC subsidiaries will gain sector expertise and a commercial track record that can be monetized in the future by listing on the stock exchange. Additionally, these sector subsidiaries can expand internationally, participating in projects in other Belt-and-Road Initiative countries, generating foreign exchange revenues for Pakistan.

The complex multi-sectoral, multi-regional projects the SIFC intends to undertake cannot be effectively executed by centralized bureaucracies – the collapse of the Soviet Union’s planned economy is an example. Development is almost always private-sector-led and public-sector facilitated – and hence large-scale economic transformation in Saudi Arabia, South Korea, Taiwan or post World War II Germany had extensive private sector participation.

Whether through Ayub's five-year development plan, Musharraf’s National Reconstruction Bureau, or the game-changer CPEC, our citizens were promised a prosperous future before. But each time the reform efforts got bogged down and abandoned, leaving the citizens despondent.

The lesson from Saudi Arabia’s success demonstrates the need for an apex implementation agency, free from bureaucratic legacy or shifting politics, to execute upon and realize our grand vision of economic transformation.

Concluded.

The writer is a venture builder, aprivate equity investor and investment banker. He tweets/posts @AhmadJalal_1