Why Pakistan's Economy is Under Developing

[awaisaftab]

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[Pracs]

A good start Awais, I will try to address some of the issues above, although I must warn I am not an economist or hold a degree in the subject.

I think the following are the main issues we need to resolve before any thing can happen in the socio-economic front

1) Education (literacy and skills) and awareness (I guess that is happening re the Electronic media)
2) Building institutions that are not swayed by changing governments
3) Restoring foreign investors confidence (including overseas Pakistanis who have a huge role to play but are discouraged)
4) Provision of energy (electricity, gas, petrol)to industry and agriculture at subsidised rates
5) Research and development in niche industries including agriculture
6) Development of infrastructure, storage, shipping, ports
7) Instituting a fair and accountable system re provision of Justice (I am talking from an investor's point of view)
8) Political stability and moving away from 'one person' rule, towards institutions
9) Effective management and steering of economic plans (we have some really good plans on paper but these are never implemented)
10) Most important of all provision of law and order safeguarding the interests and life of ordinary citizens



Oh yes just a correction, it was South Korea that took up our five year plan model and took off in the proverbial economic sense, we were almost in that stage but of course got pulled back due to Bhutto's nationalisation and the first flight of capital from Pakistan.

[awaisaftab]

Dear Pracs,

Thanks a lot for your response and correcting me. I was also not sure about whether it was south corea or north corea.

Thanks and regards.

Awais

[awaisaftab]

Dear Pracks,

I am 100% agree with you the policy of nationalism was wrong. Infact Bhutto was impressed by the socialism and gave the idea of islamic socialism. Which was entirely wrong. Economic system of Islam has no match with socialism and capitalism. Due to the policy of naionalization the confidence of foreign as well as domestic investors shaken badly.

Soon I will write a detailed topic on Islamic Economics.


Regards

Awais Aftab.

[Toronto_Boy]

Dear Friends

We can identify thousands of areas to reach economic prosperity, but without education, political will, stability, sense of collective betterment rather than individualism, honesty, etc. etc. etc. we cannot get economic goals. Dears, we have good systems, plans, laws, and projects on paper, but without implementation, continuous evaluation, and monitoring these are useless.

Moreover, in my view, no policy is good or bad in entirety or in black or white, like nationalization, it is actually us who distort them and make them fail. There are no absolute free enonomies are prevalent in this world including USA which is the biggest free market economy. Even there we have collective systems.

However, it is a very long debate and we all know actuall results.

Regards

[awaisaftab]

Dear Toronto Boy

I am agee with you that no policy is good or bad or entirely white or black. But my dear well known economists have the view that the policy of nationalization caused flight of capital. If the threat of nationalization exists then the investors remain afraid of it.

Morever, According to constitution of 1973 no law against the Quran and Sunnah (SAW) can be formed. This constitution was also formed during the rule of ZA Bhotto. According to well known religious scholars the State has no authority to acquire the control of private entrepreneurs on the basis of its power.

Regards,

Awais

[CFANerd]

We have everything and still have nothing. RULE OF LAW is the biggest problem. TAX EVASION and LACK OF TRANSPARENCY is second.
Without law, there is no security, without security, there is no confidence, without confidence, there is no initiative, without initiative there is no progress. It can lead to numerous other factors e.g. low foreign investment and flight of capital as someone mentioned above.
Secondly, tax evasion can result in uneven distribution of wealth, no public projects, no strong infrastructure, no money to support public eduction and result is a illiterate population.
Corruption can be a by product of no rule of law. Study Mr. Zardari's personality if not sure.

[Muhammad Saeed Ch]

to my understanding,Pakistan is lacking the most important part of Economics.
thats 'Planning'

Dams were not built on time, what was the results, no electricity and loss to industry.

No planning in any sector take agriculture - one year its all sugarcane. WOW!
low prices for sugar, loss to 'KIssans'. then next year no sugar cane found. high prices for sugar. good.

no planning on education sector. people having more than 45 universities in Islamabad (though high cost education), what should the other people do? come to the capital?????????????

Planning and sticking to the plans is required.

I believe that is the root cause. yet no one can pin point.

Economic planning has been and is in discussion for all the economists.

[awaisaftab]

Beside plannin control,monitoring and implemtation is also important. If good plans are formed but no efforts are made for their implementation and control of assigned resources then,in my opinion, it will all useless. Although proper planning was made in Pakistan Five Year Development Plans were good example of economic planning. But after these plans no focus was made on the implementation and monitoring and even on any further economic planning.


Regards,


Awais Aftab

[Toronto_Boy]

Dears

Let me tell you that we had and have good plans. Planning Commission, Planning and Development Division (at Federal level), and Planning and Development Departments (at Provincial level) have been doing a good job as far as planning is concerned. However, first the political will, and secondly necessary resources have been bottlenecks in implementation of plans. Later on, off-course, monitoring and control have been compromised greatly due to lack of transparency, accountability, and prevalent widespread corruption culture.

What can be expected from lower to mid-range government officers with fixed salaries (Grade 17 to 20), while trying to meet end means, see that their higher-ups as well as almost whole of top elected and non-elected successive governments are comprised of most corrupt people.

One of the most discouraging factor is, over a period of time, we have evolved a system in which mostly those people would flourish who are more and more corrupt in any sense.

Regards

[karimwagan]

well, in my opinion the steps taken by BHUTTO in 70's were absolutely right. Its only because of Nationalisation that; a)millions of people got jobs. b) thousands of people settled abroad (arranged by BHUTTO) c) Production of goods & commodities increased to considerable level. d) Monopolies of a few families who were not contributing towards economic growth of the country but only sucking blood of Pakistani people, came to an end.

In perview of the BIPOLAR world in 70's and a WAR trodden country, BHUTTO took bold and very appropriate steps. He was the Leader in actual means.

There is only one reason that economy of Pakistan could not florish. The single and only one. That is ..................................................... WE CAN'T DISCUSS THAT REASON.... SORRY..!!!

[Toronto_Boy]

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by karimwagan</i>
<br />well, in my opinion the steps taken by BHUTTO in 70's were absolutely right. <hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">

Dear karimwagan

First of all, welcome to the forum. Cheers...

Would you please enlighten us further about your opinion providing absolute assurance to socio politico economic policies of said gov't, specially considering negative impact on growth, investor's confidence, and capital flight.

By the way, I am too a fan of Bhutto sahib, so just a side question. Are you some sort of party office bearer? ... Just kidding... Smile [)]

Regards

[Tango]

why pak eco z undr dvlp?

look production sector, major portion z MNCs-result low income portion towards the residents/local business/
Unequal distribution of profit among factors of production as it goes 75% to investor n only20-25% goes to the labour factor,
there is no proper flow of monetry+real resources/income, it is concentrated around 5-10% of population,
hoarding in trade/flow and exchange of wealth,result artificial inflationary pressure,
on the consumption of wealth, the highest income/wealth holding portion of population(5%) get stagnant of wealth inspite of investmt in production or only invest in banks,
large portion of natural resources/HR unemployed in our economy,,

but question z that in our national income which takes its major part?
why our natuaral n human resources unemployed in eeconomy?
why there z difference b/w local Manufacturing and MNCs?