Political stability is must for economic stability in Pakistan

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Political instability fueled by domestic and external factors is continuously stabbing
the back of our economy.

Few days back, we celebrated the 75th birthday of our country with full boom and zeal. Your ears might be still receiving the buzz and bang of few Baja’s yet unblown. While at the same time political mudslinging, vicious blame game in the power circles, media rhetoric, fake news, and power politics might be adding multiple flavors in your daily routine.

The society is deeply polarized where current political misadventures and vendettas are on the tip of the tongue of every Pakistani. In every nook and corner, daily bread earners and wagers severely hit by uncontrolled inflation are continuously bashing the authorities responsible for this fiasco. Those at the helm of power, with high on rhetoric and low on actions seem less bothered about the miseries confronting the common men. Political victimization, witch-hunting and growing intolerance are the order of the day. The economic turmoil fueled by political instability is pushing the country towards a perpetual state of crisis.

Inflation is record high (24.9pc), rupee is record low (1$=216.49), unemployment surging(6.3pc), oil prices skyrocketing, uncontrolled load shedding, dwindling foreign exchange reserves ($9.3bn) and mounting debt(RS.60tr) are few to mention. The problems are manifold that need deep introspection to understand the reason why and how the nation came this far? Are we not the architect of our own failure? Is it not that, finally the chickens have come home to roost? Should we hope for any light at the end of the tunnel?

In the following lines we will throw some light on the intricacies and loopholes highly embedded in the system and creating instability.

Pakistan since her inception has gone through boom and bust cycles, with a period of growth followed by period of stagnation. The undue share in the partition followed by constitutional crisis, and frequent political upheavals has shaped our 50‟s. The extent of political instability can be gauged form the fact that, the nascent state at its embryonic stage witnessed 7 prime ministers in a span of almost7 years. This has contributed a lot towards a weak economic base which has not been stabilized throughout major part of history.

While in the neighborhood, despite Nehruvian socialist regime, India was growing at 3.9pc compared to Pakistan‟s 3.1pc, owing to much greater political stability and policy continuity. The 60‟s, 70‟s and 80‟s can be attributed to civil-military power struggle mostly dominated by men in uniform, though undemocratic but long term policy making and implementation led to an average growth of 5.5pc (World Bank Data) in these years. Some scholars believe that being an ally of West in the Cold War and Afghan episode of 80‟s influxes huge sum of aid and abetting that contributed a lot in economic boom during these years.

However, we cannot deny the fact that comparatively stable political atmosphere substantiates the growth.

The political musical chair and troika politics of 90‟s is yet another grim episode in the history of economy. Lack of structural reforms, vested interests of political leadership, narrow investment coalesced by western sanctions in the aftermath of cold war put a huge dent on economy which grows at a snail‟s pace averaging 4.4pc (World Bank Data). Vernon Hewitt aptly describes the period of 1988-1999 as: „‟Eleven years of political instability and constitutional decline, where the Pakistani sate was dissected into parallel and disengaged political and legal authorities. The president was pitted against Prime Minister, the secular oppose the religious authority, the judiciary acted against the executive, and the executive contrasted the legislature. This paralyzed the Pakistani government and created irreparable instability.

‟ The never ending political skirmishes, opportunistic leadership and volatile border situations once again paved way for the military to make inroads in the politics of country. The 9/11 saga at the dawn of 21st century has shaped the future course of actions. The Bush Doctrine of “With Us or Against Us” enforced the then President to ally with the West in Global War on Terror (WOT).

The US provided $20bn in aid but loses to the Pakistan‟s economy have exceeded $150bn, more than 70,000 Pakistani have been brutally killed, tourism and investment dried up, exports shrinked, terrorism, sectarian violence and extremism deeply uprooted the social fabric of the society. However, during the
eight year stint of military takeover the size of economy increased by almost 50pc and per capita income raised by nearly 25 pc. Meanwhile, this was not because of deep structural changes but somehow credited to quantum of external flows and aid received during this period. The yawning structural issues linger on, accumulated by partisan politics and narrow interests of political parties, as no one paid enough heed to grout the underlying cracks heavily rooted in the system.

Today, the situation is no different. The hitherto political crisis has flared up since the episode of filibustered vote of no confidence against former Prime Minister Imran Khan. The incumbent coalition government is facing multitude of problems socially, politically and economically.
Socially people, societies, and families are highly fragmented on partisan preferences, intolerant and divided under politically motivated slogans. The uninformed masses regulated by emotional dominance are serving as a pawn in this political chess game where inherently it‟s the people who are bearing the brunt. Subsequently, confluence of polarized politics and economic turmoil is coming hard on downtrodden families. A country where an average household spent almost half of their income on food is succumbing to hunger and poverty due to spike in the prices of essential food items. According to World Food Programme (WFP) 43pc population of Pakistan is food insecure and on UN‟s Human Development Index, Pakistan ranks 152 among 189 countries of the world, which is very alarming. Politically, the Parliament which is considered as bedrock of democracy has been left without an opposition, the judiciary is acting on its own whims and wishes, the status of administration and governance is abysmally poor. The mismanagement of recent flooding across the country is the case in point of governance failure. Rampant corruption, growing mistrust in the state institutions, narrow space for freedom of expression and uncivilized culture is continuously adding more fuel to the fire. The lack of predictability and political chaos is blockade towards investment in the country, which is evident form the fact that Moody‟s Investor service in June has downgraded Pakistan‟s credit rating outlook to negative from stable. With each passing day there is no news as good news rather predicted to be gloomy for the days to come. To get rid of current quagmire, more prudent and out of the box policy initiatives are indispensable. The political consensus among all constitutionally mandated institutions is the key. The nation stands on its Achilles‟ heel, where further instability would be a recipe for complete disaster. Even though, the current economic turmoil is also compounded by global factors like aftereffects of Covid-19, soaring international oil prices, global shortages of LNG, and most importantly the Russia-Ukraine conflict which exacerbated the economic plights globally. For instance, both Russia and Ukraine combined account for almost quarter (30pc) of global grain exports, but the conflict severely disrupts the global supply chain, thus causing inflation globally. Pakistan, being a rentier economy is no different, however in order to develop resilience against such global shocks the politics and policies should be oriented towards enhancing the local productivity, empowering the human capital, improving the agriculture yield, research, market creating innovations and most importantly a stable outlook to capture investors from abroad. This cannot be made possible without strong political will, efficient leadership, strong institutions, long-term policy making, and most importantly informed masses citizens who are inevitable to not let the authorities make compromises on their constitutionally mandated rights. For making a successful nation we need to follow what Daron Acemoglu and James Robinson mentioned in their well-read book: Why Nations Fail, which is to adopt a governance system that is inclusive and citizen centric rather than exclusive and exploitative. Form the aforementioned discussion it can be concluded that the past mistakes are seriously hurting us today. With a turbulent present, the future also looks very shaky unless the State gets
rid of this unwanted situation.

Hopes are fading away, sovereignty dwindling, ideology, beliefs and social capital is weakening. Persistent danger is pushing the country towards the point of no return. Under these circumstances the nation is looking for a messiah for some relief.

Nonetheless, all is not over yet, the nation is still hoping against hope for a better tomorrow.
After all, Pakistan is a hard country and will never die young.

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