National Security Policy: EAG welcomes recognition of economics as keystone of national security

ISLAMABAD: In its initial review of the recently-released National Security Policy, the independent Economic Advisory Group (EAG) of Policy Research Institute of Market Economy (PRIME) has welcomed the recognition of economics as the keystone of Pakistan's national security while noting that under-investment in development is clearly detrimental to national security, especially in the medium and long-term.

The EAG cautioned that in seeking to address too broad a spectrum of socioeconomic issues, the national security policy could dilute its focus on the core issue of security as encompassed in protecting Pakistan’s borders and ensuring internal harmony.

The EAG stressed that it is important that stakeholders guard against this, and also against the possibility of economic policy being subsumed within the national security paradigm. While it is important to correctly identify and highlight all factors impacting Pakistan’s national security, it must be the responsibility of the relevant ministries to make the plans to overcome the challenges in their areas, and to implement them. The EAG said it would like to see economic ministries and institutions put in place plans with specific policies regarding the important challenges that are identified by stakeholders.

While reviewing the NSP, members of the EAG appreciated the recognition of the country's failings in providing economic opportunities, and the under-investment in human capabilities, which is, in part, the result of the country's unavoidable burden to invest in military and defense assets due its geographical exegesis. While resources need to be allocated for legitimate defence needs, the EAG notes that the government recognizes that resources need to be re-distributed, thereby freeing up limited tax revenue towards re-investment in education, health, and other important areas.

The EAG is of the view that economic interests should guide the country’s foreign and security policies and endorsed the broad thrust of the NSP in this context. The members further observed that a strong economy is a pre-condition for a strong defense, which can provide security of life and opportunity for prosperity to its citizens. Recognizing various security challenges that Pakistan faces, the EAG highlighted both external and internal factors, including cybersecurity that should be addressed by NSP. Echoing concerns about the absence of debate on the NSP in the Parliament, the EAG stressed that transparency and participation are hallmarks of a functioning democracy.

In agreement with the NSP, the EAG said it would like to see policy measures that realign Pakistan’s international relations with regional countries, as well as world powers, keeping the welfare of its citizens as the core criteria of evaluation of policy options. Giving the example of Pakistan’s recent relations with India and Afghanistan, members of the EAG emphasized that a geo-economic vision as outlined in the NSP entails open trade with both countries, while continuing to negotiate on outstanding issues. This is the practice of successful countries that pursue economic relations while working on resolving outstanding disputes. In the past, and contrary to the proposed vision, national security policies have driven economic relations with regional countries. This has prevented Pakistan from leveraging its geo-strategic location towards achieving its geo-economic objectives.

The EAG had earlier highlighted in its "Vision for Economic Transformation" document that failure to integrate with the rest of the world has meant that Pakistan has been unable to take advantage of the vast opportunities offered by the global marketplace. This has stymied innovation and productivity gains among Pakistani manufacturers, making them globally uncompetitive, and therefore, unable to scale up and create jobs. The EAG would like to see that the specific ministries responsible for trade develop and implement policies in line with the NSP vision, such as:

The present custom and regulatory duties regime is replaced with a uniform tariff across all sectors and product categories; In consonance with the NSP, Pakistan is focused on being competitive for parts of Global Value Chains (GVCs) for products, rather than for the entire product;

We actively engage with regional trading blocs with the aim to either join these or enter into an FTA with them. Lastly, but consistent with the contours of the NSP, the EAG members drew attention to legal and political rights, rule of law and contract enforcement as important pillars of protection of individual freedom.