Charter of economy

There is no doubt that Pakistan needs an immediate economic strategy to come out of the current mess, which has come about due to political mismanagement among other reasons. This economic emergency needs an immediate economic solution based on political consensus backed by all our political parties.

Political and economic developments in the country are intertwined and most of the time support each other in stabilizing the country or otherwise. In the case of Pakistan, political stability has been an issue. This is why a charter of democracy was signed by the late Benazir Bhutto with Mian Nawaz Sharif. But political stability in Pakistan is still a distant dream. This is why we have been talking about a grand dialogue in and amongst all institutions for political stability and consequently for economic prosperity.

If we look at the history of the world and countries that have developed economically, one thing is common: a stable political system. All those countries that have been suffering from political instability could not develop economically. Take the example of Europe, the US, Canada or even Russia and China: they all had a stable political system. Less developed countries lack political consensus and a strong political system which is why they could not develop. Pakistan needs political stability and consensus to progress. A charter of democracy is all the more important to realize the goal of a charter of economy.

The political system of any country is the backbone and engine of the development train so a charter of democracy would lead a charter of economy. This fact has to be understood by our nation to progress and develop economically. There is no doubt that Pakistan is badly suffering from current account and trade deficits along with a high volume of debt and debt servicing. Circular debt is another headache. There’s also currency depreciation and our foreign reserves are depleting day by day. The poor are in a miserable condition due to high inflation and price hikes.

So what has to be done for a charter of economy? The economy needs to be revived at all cost, if we want to survive with honour and respect in the world. The constitution of Pakistan ensures equitable and just development in all regions of Pakistan. It is a perfect social contract but it has been dishonoured more than once, which is the basic reason behind our economic downfall and brinkmanship. There should be at least a 20-year roadmap for revival of the economy, industrialization, corporatization and debt management system to get rid of international loans. A grand political dialogue is a must to provide the required stability and continuity to the system.

Tribalism and feudalism still prevail in Pakistan, as does colonialism in different shapes and colours, with the military and civil bureaucracy having converted Pakistan into a security state. That approach has to be replaced with a welfare-state vision of the country. The state is prime, no doubt. But it is for the people who are responsible for the security of the state through their confidence in the state.

In the case of Pakistan, there is an immediate need to re-evaluate the needs of the people and the state of Pakistan. The concept of security requires a thorough revision to ensure an impregnable security to the state. Hybrid regimes have to be dispensed with for a stable political system. It is only a strong and stable political system that can deliver. This is absolutely necessary for the economic development of Pakistan.

Strong democratic institutions in the democratic world deal with security issues in a far better way. And democracy and democratic values support and facilitate a flourishing economy in the democratic world. The revival of Pakistan’s economy is a must, so we have to evolve a system of consensus and consent by all – including but not limited to all political parties. One thing is very clear: we are not a war economy like the US nor an oil economy like Russia, so we have to rely on our own resources to flourish. Our geographic location and geo-economic strength are our assets and if utilized in the best possible manner can prove to be strategic to our economic revival.

The possible contours of the charter of economy may include boosting industrialisation by creating industrial clusters like SEZs, opting aggressive privatisation attracting big volume of FDI, enhancing export targets, channelizing foreign remittances, promoting agriculture and agri- businesses, economising the services sectors and investing in human development. Education, especially technical and vocational education, is all the more important and must be prioritized to get a 100 per cent literacy rate in 10 years.

Primary healthcare is another neglected sector that needs to be prioritized. Our ranking on the Human Development Index may be improved to achieve sustainable goals as a national priority and duty. Global resources need to be tapped for this noble cause. The Chinese economic model of Deng Xiaoping may be adopted as a guide and a way forward to achieve the dream of high trajectory of economic growth.

Pakistan needs an economic transformation policy framework to overhaul its economy by redefining and restructuring its resources as well as incentives for economic growth. This policy framework is necessitated to achieve sustainable development goals by improving social and human capital indicators. The macroeconomic transformation framework would revolve around some key initiatives like pursuing a growth model promoting investment, public-private partnership, infrastructure development, large-scale manufacturing, enhancing exports, ensuring energy and food security.

There is a need to assign more importance and priority to social and human capital by giving more emphasis to women’s empowerment as part of the transformation of the social fabric of society that provides the bases for sustainable economic development. A long-term planning document outlining an economic model for the future is needed to work out where Pakistan should be in the next 20-30 years.

The writer is former federal secretary. He can be reached at:

hassanbaig2009@gmail.com