In the 76th year of Pakistan as a Muslim-majority state, confined since 1971 to the former West Pakistan when its eastern wing seceded to become Bangladesh, all indicators of economic, political and social development indicate negative trends. Scores for India from which it separated in 1947 and Bangladesh which separated from it in 1971 for such indicators are significantly better.

Pakistan’s ruling class, the power elite, the establishment or the deep state — whatever description one chooses to describe it — is notoriously and proverbially corrupt, inept, irresponsible and uncaring. Economically and financially, Pakistan is for all practical purposes a bankrupt state heavily under debt to foreign institutions and states. Its ability to borrow loans has reached a point of saturation. China’s CEPC project in Pakistan which was to be the panacea to overcome chronic electricity deficit, build roads and developmental infrastructure and generate new employment opportunities, is in the doldrums.

Business and trade are in a very bad shape. Industrial growth and development have stagnated. Pakistan remains largely an exporter of raw materials and semi-finished goods. Once the granary of India, exporting wheat from Punjab to other parts of the subcontinent Pakistan now suffers acute shortage of food and vegetable and galloping inflation has caused a price hike of essential commodities pushing more and more people towards poverty. Notwithstanding the mounting difficulties of the people, the Pakistani ruling class remains oblivious to the suffering of the people.

Politically, Pakistan has failed to establish civilian supremacy. Although a constitution from 1973 is in place upholding fundamental rights and other liberal values, several Islamic features and commitments hedge in those rights. Overall, Pakistan’s representative and democratic institutions lack credibility because elections have not been institutionalized and it is the military or rather the Pakistan Army which calls the shots. Its major political parties are either dynastic preserves or dominated by cult leaders. Mass media churns out biased reports and programmes.

The English-language press generally reflects a rational-liberal mode of thinking the much bigger Urdu-language press is prone to sensationalism. For a long time, extremist ideas and movements promoting militant Islam have had a free hand with proclivity towards violence including mob attacks on non-Muslims, atypical sects and free thinkers.

Socially, Pakistan remains the most conservative society in the subcontinent. Vain attempts to Islamize Pakistan have generated intolerant attitudes which are invariably hostile towards women and religious minorities. The annual reports of the Human Rights Commission of Pakistan report heinous crimes committed against women and non-Muslims. The lack of an effective family planning and birth control policy has meant that Pakistan’s population growth rate remains the highest when compared to India and Bangladesh.

Equally, literacy rates lag behind India and Bangladesh and especially those of females. Some 35 million children are out of school and 45 million are estimated to be suffering from chronic malnutrition. Pakistan’s higher educational institutions are woefully inadequate in encouraging independent and critical thinking or in instilling scientific curiosity. The compulsory teaching of Islam in the schools and colleges has meant extra burden on students without such knowledge having any meaningful relevance for their careers and employment opportunities. Moreover, the teaching of Islam does not exempt non-Muslim pupils. Overall, the educational system inculcates prejudices against non-Muslims. Externally, India is especially described as the enemy of Pakistan and Muslims. Pakistan is generally portrayed as the citadel and bastion of Islam. The Pakistan military is celebrated as a garrison state ready to defend its territories, Islam and Muslims from external and internal enemies and fake stories of military victories during wars with India are taught in the educational institutions.

 

Attempts to Islamize Pakistan have generated intolerant attitudes which are invariably hostile towards women and religious minorities.

Most of Pakistan’s current ills are rooted in the ideologization of politics. A state driven by ideology invariably operates at the cost of national interest. It leads to the obfuscation of the objective reality which in turn results in flawed policies. Rational self-interest whether of the individual or a state must be based on a careful examination of the objective reality and the options available to deal with it. It requires flexibility and pragmatism and the rule of law.

Pakistan’s confessional ideology has proved to be dysfunctional
Winning Pakistan in the name of a confessional ideology which dichotomized Hindus and Muslims as two discrete, hostile but homogeneous nations was undoubtedly the masterstroke upon which the founder of Pakistan, Mohammad Ali Jinnah, won the case of Pakistan. However, it was a misleading depiction of Hindus and Muslims. The fact was that both Hindus and Muslims were deeply divided from within. Caste divisions among Hindus were notorious but the Muslims were equally deeply divided because of sectarian and sub-sectarian differences in belief and doctrine. Moreover, both Hindu and Muslim communities were amorphous entities comprising millions of people dispersed all over the Indian subcontinent. Ethnicity, language and other particularistic identities and local associations played a major role in defining their day-to-day lives.

At any rate, Pakistan came into being in a most violent and bloody manner with more than a million Hindus, Muslims and Sikhs killed in heinous communal conflicts and 14-15 million of them crossing the border between India and Pakistan. Yet, millions of Muslims were left behind in India while a much smaller Hindu minority stayed on in Pakistan (since 1971 confined to West Pakistan).

Another of Jinnah’s masterstrokes was to evade describing what sort of state Pakistan would be. In his hundreds of speeches, statements and messages can be found those which describe future Pakistan as a Muslim democracy, others which portray it as an ideal Islamic state inspired and informed by Islamic law and the praxis of state from pristine 7th Century Islam and one solitary state made on 11 August 1947 where he waxed eloquence about Hindus and Muslims being equal citizens of Pakistan.

In his later public speeches, he returned to the organic connection between Islam and Pakistan but insisted such a connection meant both democracy and ideal protection of minorities. However, regarding centre-province relations, Jinnah, who before Pakistan came into being,was a champion of decentralization, became a vehement opponent of what he decried as parochialism and provincialism, emphasizing that Muslims were a nation of faith while regionalism was a tool of the enemies of Pakistan.

Most of Pakistan’s current ills are rooted in the ideologization of politics. A state driven by ideology invariably operates at the cost of national interest. It leads to the obfuscation of the objective reality which in turn results in flawed policies.

In an interview given to the former foreign minister of Pakistan Sahibzada Yaqub Ali Khan and Syed Ahsan, his military and naval who wanted to know why no progress on the constitution was being made and why India was moving fast to frame one for itself Jinnah admitted candidly that he had been making contradictory pledges to different schools of thought among Muslims. Therefore, he had reposed the duty of framing of the constitution of Pakistan to the Pakistan Constituent Assembly.

The first move on the constitution was made on 7 March 1949 when Prime Minister Liaquat Ali Khan moved the Objectives Resolution. It called for Pakistan to be an ideal Muslim democracy upholding the sovereignty of God. He reiterated that Pakistan will be a modern democracy in which fundamental rights will be enjoyed in accordance with the lofty standards of Islam. What such rhetoric meant concretely for constitution and law-making was not spelled out. While the few Hindu members of the Constituent Assembly invoked Jinnah’s 11 August 1947 speech to plead for a secular Pakistan, the Muslim members who spoke in support of the resolution unanimously underscored that Jinnah had ad infinitum described Pakistan as a state for Muslims and where Islam will be the main source for constitution and law making, but assured the Hindus that would not mean a theocracy but a spiritual democracy fair to all.

What followed thereafter were protracted deliberations on the democratic and Islamic character of Pakistan. The constitutions of 1956, 1962 and 1973 contained familiar civil, political, social and cultural rights but hegded them in by Islamic limits! The current constitution of 1973 added more Islamic features. Not only the president but also the prime minister was to be Muslims. In 1974, the Pakistan Parliament unanimously declared Ahmadis as non-Muslims because they did not believe that Prophet Muhammad (PBUH) was the last of the prophets sent by God. Under General Muhammad Zia-ul-Haq, Hudood and blasphemy laws and several misogynist laws and practices were introduced. They brutalized sensibilities and encouraged a mob mentality preying on those suspected of disrespect to pure and true Islam. Some 96 people have thus far been killed by frenzied mobs and among them have been Christians, Hindus, Ahmadis and even free-thinking Muslims of Sunni origin.

The introduction of zakat tax by Zia was rejected by the Shia minority which agitated for exemption from it because they were not willing to pay it to a Sunni state. In the 1990s,a proxy war was fought on Pakistani soil between Shia Iran and Sunni Saudi Arabia through their sectarian affiliates in the form of armed militias. The terrorism which followed claimed hundreds of lives, but the upper hand belonged to the Sunni extremists who not only formed a majority of 85 per cent but were supported by state agencies. The gruesome assassinations of the Governor of Punjab Salman Taseer and of the Federal Minister of Minority Affairs Shahbaz Bhatti in 2011 are cases of terrorist attacks on high profile individuals, but the extremists have not even spared foreigners working in Pakistan. All this is verifiable from the Pakistani press and annual reports of the Human Rights Commission of Pakistan.

In short, Pakistan is a state whose ideology has taken upon itself the responsibility not only to perform the three main functions all states are expected to perform: protect its population from external aggression, punish crime and provide conditions to produce the material goods needed to sustain and reproduce society, but also to ensure that its policies pave the way for the salvation of true believers. It is a pre-modern ideology harking back to a golden past oblivious to the objective reality of diversity of beliefs within Muslims and between Muslims and non-Muslims. Such developments have placed Pakistan high on the list of countries where extensive, systematic violation of human rights of people take place

Using Urdu to eradicate regional identities has provoked separatist reactions
Closely related to Islam as the basis of nation and nationalism is the problem that Urdu is declared the language of Muslims and therefore a core element in the Pakistan ideology. Its roots go back to the polemics between the Indian National Congress which wanted Hindustani to be the national language of a united India with two official scripts, Devanagari and Urdu-Persian and all provinces having the right to use in their province their mother-tongues for government communications and education. This was rejected by the Muslim League; it insisted that Urdu was the mother tongue exclusively of Muslims. This was not true because not only Muslims but also Hindus and Sikhs were literate in Urdu. But Jinnah insisted on communalizing the language issue.

After Pakistan came into being the state was hellbent on establishing a nation which not only shared one faith but also spoke and wrote one language. The fact was that in 1947 Pakistan contained five major indigenous language groups: nBengalis, Punjabis, Sindhis, Pakhtuns and Baloch and several smaller groups such as Brauhi speakers in Balochistan, Saraiki speakers in southern Punjab and lower Sindh and some even smaller groups. The Urdu-speakers who migrated to Pakistan in 1947 from North India and Hyderabad State formed less than 4 percent of total population. That percentage has increased to 7 percent after East Pakistan broke away from Pakistan to become Bangladesh in 1947.

The imposition of Urdu on Bengalis was one major reason why they were disillusioned with Pakistan. Unlike Punjabis and to some extent educated Sindhis, Pakhtuns and even Baloch were conversant in Urdu but not Bengalis. The language issue in Bengal was the beginning of Bengali resentment against the West Pakistani establishment which they accused of exploiting the resources and income of East Pakistan to finance the development of West Pakistan. Cumulative grievances of the Bengalis finally culminated in the breakup of Pakistan in 1971.

In post-1971 Pakistan, the language question continues to produce resentment in Sindh, Khyber-Pakhtunkhwa and Balochistan. There is no doubt that using Urdu as the medium of education has made it the link language between the four provinces of Pakistan, but the suppression of regional languages and cultures alienates the dominated minorities from the Punjabi dominated Pakistan government. It can be pointed out that by using Islam and Urdu as ideological tools in 1955 the four provinces of West Pakistan were amalgamated under the One-Unit scheme into the single province of West Pakistan. Such forced amalgamation was never accepted by the dominated provinces and in 1969 the One-Unit was dissolved and Punjab, Sindh, Khyber-Pakhtunkhwa and Balochistan became separate provinces.

Such a tendency resulted in protests from the provinces and was a major contributing factor to bitter relations between the centre and the provinces. However, protracted negotiations finally forced the hand of the central government, and the 18th Amendment was agreed whereby many of the powers were handed over to the provinces and their share of the national budget and resources increased to 53 per cent to the provinces and the rest to the centre. Even after the agreement, calls are being given to regain the powers by the centre because of external and internal threats to Pakistani unity.

India-centric and Kashmir-fixated foreign policy has ruined Pakistan

The third pillar on which the Pakistan ideology rests is the belief that India has never accepted the creation of Pakistan and is constantly conspiring to undo Pakistan. From 1937 onward, Jinnah began warning that in a united India Islam will be annihilated and Muslims obliterated and therefore the creation of Pakistan was a matter of life-and-death for Muslims. Ironically, he was willing to leave 2 crore Muslims in India to be sacrificed and smashed to liberate 7 crores from the yoke of Hindu rule. In any case, bitter conflicts over the share of the colonial kitty and conflicting claims to territory degenerated into zero-sum games between them at international forums.

In any case, neither Jinnah nor Liaquat Ali Khan put any high premium on democratic procedures. After their deaths, a serious dearth of civilian leadership paved the way for the civil servants to call the shots, and they in turn were superseded by the most powerful institution in Pakistan, the Pakistan Army. In any case, conflicting claims over Kashmir resulted in the first India-Pakistan war of 1947-48 which left the former princely state divided between the two rivals. Having co-opted itself into Western military alliances, Pakistan received advanced military hardware and initiated military actions which resulted in the second war with India in 1965. Again in 1971, Pakistan went to war with India and after both rivals had acquired nuclear weapons in 1998, a mini-war at Kargil took place. The arms race between them has meant scarce national resources being directed towards wasteful projects to purchase and produce advanced weapons. Moreover, after the so-called Afghan jihad, Pakistan became the base from which so-called non-state actors such as the Lashkar-e-Taiba, Jash-e-Muhammad, Harkat-ul-Mujahideen and several other organizations carried out terrorist attacks in the Indian-administered Kashmir as well as major Indian cities.

Pakistan also became the epicenter of extremism and terrorism where Pakistani and foreign warriors were trained to attack targets in the West. All such vainglory misadventures have earned Pakistan the unenviable reputation of a rogue state.

Umma internationalism has only won Pakistan Brownie points
One can mention that championing Islamic/Muslim causes is part of the overall Islamic ideology although when it comes to China and its ill-treatment of the Uighur Muslim minority reported by the United Nations and other international human and minorities organizations Pakistan maintains a complete silence. In fact, atheistic China is Pakistan’s closest friend and benefactor.

Already, we have paid a very heavy price in getting involved in the so-called Afghan jihad and in propping up the Taliban movement in Afghanistan which is again now wreaking havoc in Pakistan.

Conclusion

Unless Pakistan can extricate itself from such an ideology, its democratic credentials will always be questioned. One way to retain Islam as a moral reference for good and responsible governance is to bring all mosques directly under the state and make the clerics state employees who can lead prayers according to their sectarian and sub-sectarian rituals, but they should be strictly forbidden to take part in politics. The Friday sermon should be prepared by the state in which social service, tolerance, cleanliness, birth control and other such subjects should be emphasized.

One way to retain Islam as a moral reference for good and responsible governance is to bring all mosques directly under the state

More importantly, the educational system must be freed from the stranglehold of ideology. There is ample material available showing that instead of encouraging rational, scientific, independent and creative thinking the textbooks disseminate prejudices against non-Muslims especially Hindus and India. Such an educational system fails to equip students with positive attitudes and stands no chance of competing with other societies in the production of knowledge.

Moreover, Pakistan must accept the multi-linguistic and multicultural nature of Pakistani society and new provinces can be created to reflect the diversity of cultures and identities of the Pakistani people. Forced assimilation will never work. On the other hand, if equitable relations with the provinces are established then Urdu will naturally be the language which will integrate them and while regional cultures and identities can flourish as well.

It is imperative that seeking confrontation with India will always require increasing investments in the arms race. Pakistan is already financially and economically ruined. Knowing fully that the Kashmir dispute cannot be resolved through war and invoking UN resolutions on Kashmir is a huge waste of time Pakistan can accept the Line of Control the international border between India and Pakistan but with the proviso that both states would guarantee maximum autonomy to the Kashmiri people including free movement of Kashmiris across the border.

Trade between India and Pakistan can bring great benefit to both countries but especially Pakistan. If India and China trade can increase from 100 billion USD per annum to 139 USD per annum and China and the US can manage to continue trading at a very high level despite the rising tensions between them there is no reason Pakistan and India should not do so. Restoration of trade relations with India could prove to be the stimulus it needs to start growing again.

We need to concentrate our attention on improving the dismal life conditions of the vast majority of Pakistani people instead of hypocritically championing perceived Islamophobic causes and supporting extremist movements in Afghanistan and elsewhere in the world.

In short, Pakistan must learn to function internally and externally in compliance with the prevailing norms of legitimate government, respecting the rule of law internally and internationally as well as its obligations in the external domain.

Ishtiaq Ahmed

The writer is Professor Emeritus of Political Science, Stockholm University; Honorary Senior Fellow, Institute of South Asian Studies, National University of Singapore. He can be reached at: billumian@gmail.com

The post Can Pakistan Ever Become a Normal Country? appeared first on Dissent Today.

A Policy, Unabandoned

In January this year, an official report revealed that the Punjab Police had killed more than 600 ‘suspects’ in police encounters between 2018 and 2022. On average, that means more than a hundred people were killed by the police each year, over a period of five years. Last year, VoicePK.net compiled data from 2021 on police use of deadly force, using 154 open-source articles from Dawn. While not all instances of police violence are reported in English-language media in Pakistan, their report is nonetheless illuminating. VoicePK.net’s report found that in 2021 at least 217 people were killed at the hands of the police, with 194 killed in encounters, across the country. This is aside from other instances of police brutality, such as illegal detentions, torture, and crossfire injuries. The results indicated that police brutality in Pakistan was not only weaponised in 2021, but exceeded the levels observed in 2020.

My own data on police encounter killings in Karachi, compiled through open sources (newspaper reports, police reports, and human rights commission reports), suggests that more than 3,400 people were killed in encounters with the police across the city from 2011 to 2022. It’s worth noting of course that a majority of these ‘encounter killings’ took place during security operations in Karachi (primarily between 2011 and 2018), and it is difficult, if not impossible, to decipher what proportion of these were ‘fake’ or ‘staged’ and which were ‘genuine’ (i.e., legitimate shoot-outs between the police and suspects). It is also worth pointing out that during the same twelve-year period (2011-2022), at least 682 police officials were also killed in encounters, or in targeted attacks against the police. Furthermore, while 53 civilians died in encounters in 2021, more than 120 were killed in 2022. This echoes the conclusions of VoicePK.net’s report, that there is not only a sustained dependency on encounter killings, but that we may be seeing an increase in the recent past.

Reliance upon extrajudicial police violence has furthered specific political and economic agendas of the Pakistani security state. Such police vigilantism has long been a central weapon of Pakistan’s authoritarian and violent politics, and our collective obsession with security provision and operations. It shows the persistence of authoritarian policing practices in the country, in spite of (and sometimes to enable) regime change and political transitions. Its persistence highlights how successive governments have, to varying degrees, permitted the police an informal license to kill and injure. 

One would have imagined that following the national—and, indeed, international—rage following Naqeebullah Mehsud’s killing by former SSP Rao Anwar’s team in Karachi, a categorical reliance upon such police vigilantism would be reconsidered, or significantly lessened if not abandoned entirely. But barring a temporary lull in 2018 (at least in Karachi), the case of Pakistan demonstrates that police vigilantism is symptomatic of a deeper disease, and not simply institutional rot. In this article, I explore some of the key institutional and political factors behind extrajudicial police violence, before considering a way forward. 

Police vigilantism has long been a central weapon of Pakistan’s authoritarian and violent politics, and our collective obsession with security provision and operations.

Police Vigilantism

Scholarship on vigilantism has ceased to consider vigilante violence as simply that which is inflicted by private actors and perpetrators. State institutions, such as the police and security institutions, can similarly be considered as resorting to vigilante violence, among a range of informal behaviours and practices. Drawing on the cases of South Africa and Nigeria, S.J. Cooper-Knock and Oliver Owen (2015) define police vigilantism as a form of informalised action on the part of the police that is often expected by people. “People make frequent use of the Police to mediate on their behalf ‘off the books’ and some of this informalised action, which involves the exercise of illegal physical coercion nuanced by the simultaneous possession of legal authority, can be termed ‘police vigilantism’.”. 

Writing on police impunity in the Philippines, Peter Kreuzer (2022) explains how police vigilantism is often masked. “Killing suspects in on-duty armed encounters allows the police to lay claim to the operations while denying their extralegal nature. The police can label the killings as successful crime control and, in this way, mask their vigilante quality as long as they obtain the support of the public and establishment elite for this framing. Framing extralegal killings as self-defence in the context of on-duty armed encounters thus allows the re-establishment of the police as successful guardians of societal peace and order and provides a way out of their inability to successfully fight crime while upholding the rule of law”.

These perspectives hint at several factors that make police vigilantism possible, including: (1) public and private demand, especially that of the state and its elite, (2) institutional dynamics, and (3) claims-making. Let’s explore some of these further to see how and why extrajudicial police violence persists in Pakistan.

Politics Factors and Institutional Fault-Lines 

As I explore in my book, Insecure Guardians, policing in Pakistan continues to be driven by colonial logics of policing and counterinsurgency. There are a few ways in which this has enabled a persistent reliance upon extrajudicial police violence. 

First, the colonial design of the police has kept an officer class distinct from the majority of the force (the rank and file), wherein the latter’s main task has been abiding by the instructions of the former, often under serious institutional pressures, financial restrictions, and physical insecurities given the continuous threat of death in the line of duty. This has, I argue in my work, fostered militarism in policing, or a staunch dependency upon the use of excessive force to address a range of socio-political challenges that are framed as national security “threats”. Such fostering of militarism in policing has meant that the rank-and-file are expected to operate as “violence workers”, at the servitude of the state and its elite, whose informal practices will be at least tolerated, if not demanded and expected.

Exacerbating this dynamic, is the normalisation of war metaphors, wherein the police are “on the frontlines”, fighting in the “war on terror”. While many officers regret this dependency on police vigilantism and extrajudicial violence, why they believe in implementing this policy is also important to consider. Officers with whom I spoke while researching for my book, frequently justified police vigilantism as “necessary” because Pakistan was in “a state of war” and that they were told (by their political and military patrons) to “save the country”. 

What enables such militarism and its resulting violence work on the part of the police, is also an institutional lack of trust in the broader criminal justice system. Knowing that taking specific cases to courts will result in witnesses getting spoiled, or judges “being bought”, or cases falling through due to lack of investigative capacity fosters a lack of trust in the overall judicial process. Simultaneously, it puts increasing pressure on the police “to deliver”, especially under extraneous circumstances (e.g., following the launch of security/counterterrorism operations). 

This pressure to deliver, coupled with their own insecurities resulting from being positioned “on the frontlines”, and the realisation that they lack public legitimacy and public trust themselves, creates room for claims-making. This is what Kreuzer implies when he meant that specific police encounters and extra-legal violence are framed as “self-defence” (or carried out in defence of the nation or the state), to allow the police to lay claims to such encounters and keep re-establishing themselves as “guardians of peace and order”, without actually abiding by the rule of law. 

The institutional reliance upon police vigilantism or extra-legal police violence as an informal practice thus becomes a formal performance indicator. It serves as a way for the police to demonstrate their success; displays of violence (sometimes theatrical) that are not always legal, but not always considered as illegitimate either, can be presented as important data points in annual reports demonstrating police performance.

Knowing that taking specific cases to courts will result in witnesses getting spoiled, or judges “being bought”, or cases falling through due to lack of investigative capacity fosters a lack of trust in the overall judicial process.

Supporting these dynamics, is state patronage of selected “violence workers”. The political patronage of former SSP Rao Anwar is case in point. In the 1990s, Anwar was groomed as a violence worker at a time when the biggest security threat to the regime appeared to come from the Muttahida Qaumi Movement in Karachi, and when police officers were expected and rewarded—by civilian and military elite alike—to “fight terror with terror”. But Anwar (and later, Chaudhury Aslam) were not the only officers patronised for serving political agendas, nor were Karachi or Sindh unique in witnessing such forms of informal policing practices (in this case, police vigilantism). We know from the not-so-distant memory, of horrific incidents such as the Sahiwal Encounter, or the rather curious killing of Malik Ishaq, that excessive police violence has been a key component of state coercion in Pakistan’s largest province. And there is some history behind the demand for police vigilantism in Punjab too.

Hassan Javid’s (2020) research has shown that between 2008 and 2018, the Pakistan Muslim League-Nawaz (PML-N) government in Punjab used its control of the bureaucracy, and especially the police, to influence electoral outcomes in 2013. This was enabled by the “extensive networks of patronage and clientelism” that the PMLN established. But this was not the only period in which the PMLN exerted such influence over the police. This was similarly witnessed in the 1980s and 1990s when police encounters began to be observed in Punjab, and steadily increased between 1997 to 1999 when encounter killings were weaponised to target PML-N’s opponents. This was enabled in part because of a nexus between PML-N, crime, and policing in Punjab. As Javid explains, two notorious officers (Naveed Saeed and Abid Boxer) were reputed “encounter specialists” in this period, and both were close to the Punjab government. Saeed particularly was known to have close links with criminal gangs (e.g., the Gogi Butt gang) and was also responsible for the killing of gangster Hanifa Baba “who coincidentally happened to be opposed to both the PML-N government and its criminal allies”. 

Javid suggests, what is true across Pakistan (and evidenced starkly in the case of Karachi and the operations against the MQM and in the neighbourhood of Lyari), that “the link between parties, crime, and the police must… be understood in the context of how governments in Pakistan have historically used their control over the police to exercise a check on their political opponents”. The need to keep this “check” on forms of political opposition (i.e., workers of opposing political parties, members of insurgent organisations, dissidents, even journalists) is what incentivises and drives the police to take informalised action and act “off the books”, i.e., engage in police vigilantism (to draw upon the definition by Cooper-Knock and Owen above).

The Way Forward?

In Pakistan, police vigilantism as a strategy is unlikely to be abandoned until governance and security policies are rethought and reimagined. The police, first and foremost, does the “work” of the state and its elites, which is true in large parts of the world. These political masters design security threats and criminalise objects and subjects as deemed fit (from dissent to disobedience to demonstrations). As long as these designs are sustained, policies of securitisation maintained, and a colonial logic of policing is retained, our political elite will ensure that there are always pliable, reliable pools of police agents ready to act at the behest of state and national interest, and manifest police vigilantism. At the moment, there appears to be no political will in Pakistan to revamp policing and law enforcement to serve the people, as a result of which police accountability and transparency remain a distant dream. This also means instances of police vigilantism will, most of the time, be under-investigated if not altogether ignored.

Furthermore, policing practices cannot change while social and economic disparities remain unaddressed. This is, at the very least, and given the discussion on hand, a two-part problem. 

First, as mentioned above, we need to talk about the socio-economic disparities found within the police itself. As I mentioned above, there is a hierarchical divide between gazetted and non-gazetted officers in the police. It is a divide that was carefully designed into this institution during colonial rule to ensure that a body of security workers and violence workers (i.e., the rank and file) existed, that would serve the interests of the regime, and protect its political and economic assets. In return for their violence, and in the face of routine financial hardships and professional insecurities, they would then be financially rewarded and politically patronised. They would be presided over by a gazetted cadre that would claim credit for ‘good police work’ and displace blame onto juniors for ‘bad police work’, as needed. This discrepancy within the institution demands attention. 

Second, socio-economic disparities within Pakistani society must also be discussed. So long as there are social groups that can be marginalised, criminalised, and framed as ‘security threats’ (the migrant, the refugee, the protester, the political party worker, the displaced citizen, the dissident), our law enforcement agencies will continue serving specific purposes, and in so doing suppress, even silence, through excessive force and coercion, without few—if any—repercussions.

Finally, if we do pin our hopes on reform-oriented packages and programmes, we must realise the importance of true civilian oversight and change that is driven from the bottom-up. Institutional reforms are unlikely to stick without the true representation of civil society in reform agendas, and until these efforts can incorporate localised, even indigenous responses and recommendations for justice, security, and accountability in Pakistan. This means expanding and diversifying the pool of “experts” who advise on reforms and paying attention to the demands of the local movements and pockets of resistance. This will always be an uncomfortable task for our state and its elites, but at least it will break the chain of recycling old “evidence-based” packages that may work well in the developed world, but do not offer a one-size-fits-all formula and may likely be inapplicable in the Pakistani context.

Zoha Waseem

The writer is an Assistant Professor in Criminology, Department of Sociology, University
of Warwick. She is the author of “Insecure Guardians: Enforcement, Encounters, and Everyday
Policing in Postcolonial Karachi” (Hurst/Oxford University Press 2022). She researches on
policing, security, and urban violence in Pakistan.

The post ‘Police Vigilantism’: How to Combat Extrajudicial Violence in Pakistan? appeared first on Dissent Today.

Pakistan continues to experience deep economic turmoil. Years of mismanagement by subsequent governments and political instability have contributed to the economic crisis. As I write this article, the country’s liquid foreign exchange reserves stand at an abysmally low at around US$ 4 billion, enough to cover less than a month’s imports. The Stand-by-Agreement (SBA) with the International Monetary Fund (IMF), the lender of last resort, remains stalled. The lack of progress on the IMF programme means that inflows from ‘friendly countries,’ a euphemism for China and Middle Eastern countries, especially Saudi Arabia and the United Arab Emirates (UAE), have not materialised. Subsequent governments, including the Pakistan Tehreek-e-Insaf (PTI)-led coalition and the Pakistan Muslim League-Nawaz (PML-N)-led Pakistan Democratic Movement (PDM) government, have meandered through these crises, hoping for a miracle. Limited attention has been given to the root causes of the deep structural constraints contributing to the boom-bust growth cycle affecting the country’s economy. The economic woes have been exacerbated by instability and the almost constant political engineering, which has become a hallmark of Pakistan’s political economy. 

In the rest of the article below, I will highlight some of the major issues affecting Pakistan’s economy, especially manufacturing. I will follow this with some suggestions to help alleviate these problems.

Manufacturing 

A substantial structural change has occurred in Pakistan’s economy over the last two decades. The services sector has emerged as the primary growth driver, while industry and agriculture have underperformed. Within the industry, growth in manufacturing has been particularly sluggish. A comparison with other large regional economies in South Asia shows that the share of manufacturing in GDP is the lowest and has been for a considerable period, showing evidence of secular stagnation. The declining share of manufacturing in the GDP has raised fears that Pakistan is going through premature de-industrialisation (Hamid & Khan, 2015; Nazeer & Rasiah, 2016). 

The literature highlights several issues contributing to this dismal picture in the manufacturing sector. A strand focuses on the negative effects of rapid liberalisation and deregulation, which increased the cost of inputs, for example, electricity (Zaidi, 2005). Furthermore, the privatisation of banks increased the borrowing costs for manufacturers (ibid.). More recent empirical evidence, however, suggests that over the last two decades, while tariff barriers have come down, governments have enacted non-tariff measures and regulatory duties to protect local industries. This has meant that the overall trade protection is at the same levels as in 2001. This is especially true for politically connected firms that have benefited disproportionately over the last two decades from a mix of tariff and non-tariff measures (Malik, 2022). Malik (ibid.) argues that trade protection that is given to special interest groups, especially firms with political connections, has contributed to the anti-export bias, leading to the problems of stagnant exports, low productivity, and the perennial current account deficit.

The anti-export bias also contributes to lower productivity. Evidence suggests that there is substantial heterogeneity in productivity levels between firms that export and those that don’t (Lovo & Varela, 2020). They estimate the productivity gap to be 25 per cent. Low productivity negatively affects the ability of local firms to compete in export markets (Safdar, forthcoming) as can be evidenced by the decrease in the share of exports to GDP from 12 per cent in 2000 to 10 per cent in 2021.

Apart from the anti-export bias, the structure of manufacturing remains concentrated in low-technology areas like textiles and food processing. Pakistan failed to enter high-technology areas, unlike the more dynamic economies in East Asia and, more recently, in Southeast Asia like Vietnam. This concentration is a function of policy frameworks that have created islands of what Naseemullah (2017) identifies as rent-thick areas within manufacturing in the name of food security and import-substitution industrialisation (ISI). The sugar industry is a classic example of an industry where the country has limited comparative advantage, yet it has received generous rents and state patronage (Safdar, 2015). Similar is the case with other significant contributors to large-scale manufacturing (LSM). Cement and automobiles are also technology laggards, where local manufacturers have limited prospects of achieving global competitiveness (Safdar, forthcoming). Within manufacturing, there are a few politically connected areas where rents remain high. Based on an analysis of the return on equity (ROE) for firms listed on the stock exchange, Pasha (2018, p. 158) shows that the ROE is the highest in ISI sectors like automobiles and food. Despite the importance of textiles in Pakistan’s exports, the ROE of firms engaged in textile spinning, weaving, and textile garments is the lowest among listed companies (ibid.).

Trade protection that is given to special interest groups, especially firms with political connections, has contributed to the anti-export bias, Leading to the problems of stagnant exports, low productivity, and the perennial current account deficit.

On the other hand, more dynamic industries that can become globally competitive and offer opportunities for technological deepening, like pharmaceuticals and electronics, have struggled to attract investment (Safdar, forthcoming). Exports also remain concentrated in low-technology areas, and the country continues to focus on a narrow basket of goods for a substantial portion of exports. The continued dependence on textiles is an example of this concentration. 

As opposed to creating value-enhancing rents similar to the East Asian experience, in the absence of performance monitoring by the state, state policies have created value-reducing rents based on patronage. The state’s ability to monitor rent distribution has become much weaker, while its ability to reallocate these rents is non-existent (Khan, 2000). This has given rise to a manufacturing sector where large parts remain dependent on continued state protection, with a limited incentive to improve productivity or competitiveness or to move up the value chain and diversify.

Elite interests & manufacturing

The incentives of the ruling elite do not gel with long-term development goals, and there is a focus on maximising short-term returns. Part of the problem is the access to substantial and recurring geopolitical rents over the last four decades. Access to these security rents, the distribution of which has been centralised, has had profound implications for the state’s capacity to implement growth-enhancing policies (Roy, 2013). The mode of unproductive rent capture worked even during periods of direct military rule. For example, during the decade-long rule of Pervez Musharraf, there was a marked increase in the demand for consumer durables and luxury goods on the back of high external inflows (Pasha, 2018). Pakistan’s elite favoured accumulation and speculation in real estate finance and energy (Naseemullah, 2017). Despite the inflows from external sources, speculation and consumption-based rents dominated while crowding out rents generated in manufacturing (ibid.; Dawani & Sayeed, 2020). 

The incentives of the ruling elite do not gel with long-term development goals, and there is a focus on maximising short-term return

Given the incentive structure, the returns generated by manufacturing cannot compete with those from real estate. Furthermore, lower returns in manufacturing, especially in textiles, have meant that an increasing number of local manufacturers have diversified into real estate. Pasha (2018) argues that the taxation regime has also evolved to increase returns available to real estate developers. There is little regard for the economic and social consequences of the growing number and scale of housing societies as they expand in peripheral cities and towns that supply a substantial portion of the country’s food. Organisational interests linked to the country’s leading political and economic actors have been significant beneficiaries of this accumulation model by dispossession. This link contributes to the privileged position that real estate enjoys within Pakistan.

Real estate speculation has more profound implications for Pakistan’s manufacturing sector. The failure of numerous industrial and export processing zones in the country is also linked to their emergence as spaces of speculation and rent generation (Jamali et al., 2021). While these zones and industrial estates have been successful across countries in Asia, their contribution to exports in Pakistan remains minuscule. The limited ability of the state to enforce rules has meant that even when rules are enacted to discourage speculative behaviour, they are routinely disregarded or amended, further increasing the returns to engaging in such activities. 

Can it be done without manufacturing?

Changes in the global economic structure have meant that service-led growth has emerged as a major paradigm in thinking about growth and economic development. The argument is that given advances in technology, and the changing structure of production, policymakers in countries like Pakistan that have struggled to industrialise can follow a services-led growth strategy, focusing on Information Technology (IT) and other such emerging technologies to boost growth. These slogans have enamoured Pakistani policymakers; however, Rodrik (2014) argues that while there is no denying that the role of services is growing, service-led development is unlikely to contribute to rapid growth and good jobs in the same way as manufacturing did in the past. Furthermore, structural constraints are posed by how the services sector is organised; unlike India, where higher productivity tradable services like banking and software dominate, Pakistan’s service sector is dominated by low-productivity traditional untradable services. Thus, the domestic services structure cannot support a service-led growth strategy.

Moving beyond Structural constraints

The above analysis highlights some structural weaknesses affecting Pakistan’s manufacturing sector. Structural weaknesses have been exacerbated by a short-term time horizon which has worsened unproductive rent-seeking. A growth model predicated on speculation, especially in real estate, further contributes to Pakistan’s deep-rooted economic problems. The growth model is deeply entrenched in Pakistan’s political economy. Those who gain from this economic model are unlikely to support any changes which could negatively affect their rents, even in the short run.

The road ahead is tough; however, the following suggestions could help put the country on a more sustainable growth plane:

1. Despite the initial promise, the China-Pakistan Economic Corridor has had a limited impact on Pakistan’s manufacturing sector. Despite assertions that CPEC will be a game changer, there is limited evidence of industrial relocation to Pakistan. Given the incentive structure, most Chinese investment has flowed towards rent-thick areas like power generation rather than manufacturing. In Vietnam, on the other hand, in 2018, 61 per cent of Chinese investment was in the manufacturing sector (Safdar, forthcoming). Foreign investment in manufacturing, especially textiles as the largest export-earning sector, remains dismally low. The challenge for policymakers is to alter the incentive structure to attract Chinese investment in manufacturing. There are fears regarding the impact on local manufacturers; however, in the absence of interest by local firms, inducing Chinese manufacturing investment needs to be a policy priority. This inducement must be accompanied by phased performance and local sourcing guarantees to build backward linkages.
2. Linked to the above point is the operationalisation of the Special Economic Zones (SEZs). The Chinese routinely highlight the importance of SEZs in their development. While policymakers continue to observe that the next phase of CPEC is based on industrial development, the lack of seriousness can be gauged from the fact that none of the prioritised SEZs is ready. Work on Dhabeji, which is located next to the port in Karachi, is in the early stages, and the SEZ is unlikely to begin operations in the short run. Given this situation, there is a need to expedite work on the SEZs and attract private Chinese capital. Given the scale of investment by the Chinese in CPEC, the Central Chinese government could play a role in inducing some Chinese firms to relocate their operations to Pakistan.
3. The incentive structure, which is predicated on short-term speculative returns, must change. This is vital to attract capital towards manufacturing, especially those sectors that can generate exports and become globally competitive. Changing the incentive structure is extremely difficult given Pakistan’s prevailing political settlement and the privileged position that the real estate sector enjoys within that settlement. A broad-based coalition with backing from the country’s most powerful organisation is required to alter this incentive structure. Given their organisational interests, this is easier said than done.
4. Within manufacturing, there is an urgent need to channelise learning rents to more dynamic industries. Given the political linkages of firms that have access to these rents, getting industries to forego these rents in the absence of a coalition of actors is unlikely to be successful.

Dr Muhammad Tayyab Safdar

The writer is a Post-Doctoral researcher at the East Asia Center and the Department of Politics,
University of Virginia. His research explores the political and economic implications of China’s
rise for countries that are part of the Belt & Road Initiative. He holds an MPhil and PhD in
Development Studies from the Department of Politics & International Studies, University of
Cambridge.

The post How State’s Patronage To Elite Class Is Worsening Pakistan’s Economic Crisis appeared first on Dissent Today.

Pakistan faces a severe productivity challenge. A major concern is that the exports of goods from Pakistan have remained stagnant in recent years, barely breaching the $30 billion mark while exports of other major regional countries have grown substantially. According to the trade statistics provided by the World Bank’s World Development Indicators, exports of India increased from $220 billion in 2010 to $394 billion in 2021, exports of Bangladesh increased from $19 billion to more than $50 billion, and exports of Vietnam increased from $73 billion to $335 billion, while that of Pakistan only increased from $21 billion to $22 billion in the same time period.

Although exports increased about 25.5 per cent in the fiscal year 2022, surpassing $31 billion, this growth was an anomaly in recent years. Furthermore, this growth had come on the back of extensive government support via subsidies. It is clear that this strategy was not sustainable: in the current fiscal year, export growth has eroded once again. Thus, there are now significant doubts over the capabilities of the producers in Pakistan – as it is their sluggishness to improve productivity that has cast a dark cloud over future export growth.

According to the statistics on value addition in the manufacturing sector provided by the World Bank’s World Development Indicators, manufacturing as a percentage of GDP in Pakistan was at 12 per cent in 2021. Comparatively, India reported it at 14 per cent, Bangladesh at 21 per cent, and Vietnam at 25 per cent. The contribution of the manufacturing sector in GDP in Bangladesh in 1972 was a negligible 4 per cent, while that of Pakistan was at 15 per cent. Pakistan reported a sharp decline in 2000 when the value added in production decreased from 14 per cent in 1999 to 10 per cent in 2000 as a result of the fallout from the financial implications of the nuclear tests conducted in 1998. Bangladesh and Vietnam both reported significant growth since 2010, coinciding with the higher levels of growth in their exporting activities.

The lack of productivity is a major driving force for the lack of competitiveness of Pakistani producers, not only within the domestic market but also regionally and globally.

One interesting factor is that although the contribution of the industrial sector (including construction) as a percentage of GDP is comparatively lower, it provides similar employment opportunities as its regional counterparts. Approximately 25 per cent of the total workers employed in Pakistan worked in the industrial sector in 2019 compared to 25 per cent in India, 27 per cent in Vietnam and 21 per cent in Bangladesh. This suggests lower productivity levels in the industrial sector as each worker in the industrial sector is likely to contribute less to value addition workers in regional countries. Hence, the output per capita generated by the manufacturing sector, an indicator of the level of industrialisation in a country adjusted for its population size, is likely to be relatively lower for Pakistan. This clearly suggests that the country lacks productivity, which is evident in its inability to increase exports and become competitive in regional and global markets. This paper will analyse this productivity challenge, as indicated by various indicators on manufacturing output and exports, in greater depth and recommend a way forward to improve the productivity levels.

Figure 1: Manufacturing Value Added per Capita Across Selected Economics

The trend in manufacturing value added per capita in selected countries is presented in Figure 1.

Although, the four economies had similar values in 1995, they had significantly diverged away from Pakistan by 2021. Vietnam and Bangladesh experienced an increase in their value by more than five times while the value for Pakistan even failed to double in the last three decades.

Figure 2: The Correlation between Percentage Change in Manufacturing Value Added per Capita between 1996 and 2019 and the Manufacturing Value Added per Capita in 2019

The percentage change in manufacturing value added per capita between 1996 and 2019 is plotted against the value of manufacturing value added per capita in 2019 in Figure 2. Pakistan not only has one of the lowest values in 2019 in the Asia-Pacific region, the percentage change in value added in manufacturing between 1996 and 2019 has also remained relatively stagnated. It is clustered among several sub-Saharan African countries, a region that is mostly devoid of industrial activity and economic growth. On the other hand, the regional counterparts have experienced significant growth in the manufacturing value added per capita, which is evident in their relatively improved export competitiveness.

Figure 3: Manufacturing Value Added per Capita of Countries within the Asia Pacific Region in 2019 (Ranked According to Descending Order)

Further, the position of Pakistan as a laggard in the Asia-Pacific region in terms of its level of industrialisation (as measured by the manufacturing value added per capita in 2019) is evident in Figure 3. It ranks below all non-least developed countries and non-small island states in the region. The more established export powerhouses in the region, such as Malaysia, China, and Thailand, all rank high in the figure. The fact that Pakistan has failed to improve its productivity levels, while other countries in the region have made significant strides, has important implications for the economy of Pakistan – especially since it continues to struggle with a recurring balance of payment crisis and the consequent approaches to the IMF for an economic bailout package. The lack of productivity, as indicated earlier in this paper, is a major driving force for the lack of competitiveness of Pakistani producers, not only within the domestic market but also regionally and globally.

Figure 4: Exports as a Percentage of GDP between 1995 and 2020 for Selected Countries

The exports of goods and services as a percentage of the GDP of three South Asian countries, Pakistan, India, and Bangladesh, and three South-east Asian countries are presented in Figure 4. The South Asian countries report lower levels than their Southeast Asian counterparts, with Pakistan reporting the lowest value at below 10 per cent. The South Asian countries are relatively less open to trade than their Southeast Asian counterparts.

Figure 5: Exports as a Percentage of GDP of Countries within the Asia Pacific Region in 2019 (Ranked According to Descending Order)

The exports of goods and services as a percentage of GDP for countries within the Asia-Pacific region are presented in Figure 5. Pakistan has the third lowest value, slightly higher than Kiribati and Nepal. This clearly suggests that Pakistani firms struggle in terms of their competitiveness as they fail to participate in exporting activities, which is likely driven by the low level of productivity. Countries such as Vietnam, Malaysia, and Thailand export more than 50 per cent of their GDP.

Figure 6: The Correlation between Percentage Change in Manufacturing Value Added per Capita between 1996 and 2019 and the Percentage Change in Exports as a Percentage of GDP Between 1996 and 2019

The percentage change in manufacturing value added per capita between 1996 and 2019 is plotted against the percentage change in exports as a percentage of GDP between 1996 and 2019 in Figure 6. While Bangladesh, India, and Vietnam have successfully expanded their export base relative to the total size of their economy, it has, on the contrary, contracted for Pakistan.

Figure 7: The Correlation between Percentage Change in Manufacturing Value Added per Capita between 1996 and 2019 and the Percentage Change in Imports as a Percentage of GDP Between 1996 and 2019

The percentage change in manufacturing value added per capita between 1996 and 2019 is plotted against the percentage change in imports as a percentage of GDP between 1996 and 2019 in Figure 7. This too has contracted in the last two decades. One of the key factors that is often blamed for the balance of payment crisis is the large import demand in Pakistan. Although imports surpassed $80 billion in FY22, imports as a percentage of GDP in Pakistan are not higher than that reported by its regional counterparts.

A few of the Southeast Asian countries that have become successful export powerhouses have done so by establishing important linkages between exports and imports. The economy of Pakistan has become relatively closed with both exports and imports shrinking as a percentage of GDP while its regional counterparts have only grown exports and imports in the last few decades. This could explain the fact that the low levels of productivity and its associated challenges have decreased the capabilities of the firms to become more globally competitive and subsequently hindered their participation in international trading activities.

The level of firm employment and value-added based on different trading activities at the firm level is presented in Figure 8. The data is borrowed from the World Bank Enterprise Surveys. Firms that trade two-way, that is, export and import, are not only likely to employ more workers but also generate greater value addition, which is calculated as the difference between total sales of firms and the sum of wages as well as raw material costs incurred to produce their goods. Firms that sell in the domestic market tend to be the smallest in terms of the total level of employment and are more likely to have the least amount of value addition. This signifies that firms with stronger import and export linkages are likely to be larger, enforcing the claims that firm growth is likely to be linked to their participation in international trading activities. Further, it is important to note that firms which exclusively either export or import are likely to be smaller and generate less value than firms that participate in two-way trade. Hence, linkages between international trading activities and improvements in productivity levels become increasingly important.

Low levels of productivity and its associated challenges have decreased the capabilities of the firms to become more globally competitive and subsequently hindered their participation in international trading activities

The way forward

Here are a few recommendations that can help boost the export participation of firms, by enhancing their international competitiveness.

1. Elimination of trade policy distortions: Distortions in trade policies such as high tariff rates on the imports of goods into Pakistan and targeted subsidies to specific traditional industries have pushed the inward orientation of firms and resulted in the lack of export diversification amongst the exporters. World Bank’s recent study titled, “From Swimming in Sand to High and Sustainable Growth: A Roadmap to Reduce Distortions in the Allocation of Resources and Talent in the Pakistani Economy” argues that such distortions not only increase the profit margins of firms selling their goods locally but actually reduce their desire to innovate and introduce new products that could compete globally, in turn reducing the diversification in the export base as exports remain concentrated in a few traditional products. These distortions, involving high tariff rates and export subsidies, must be phased out to improve the level of productivity at the firm-level in Pakistan. The government could start the phasing out program with the products reporting the lowest gains but receiving higher levels of subsidies and protection.

2. Accession to trade connectivity agreements: There are significant benefits in adopting cross-border paperless trade procedures and digitalization of trade processes to lower trade costs. For instance, the Framework Agreement on Facilitation of Cross-border Paperless Trade in Asia and the Pacific aims at accelerating the implementation of digital trade facilitation measures. According to a study by the United Nations ESCAP, trade costs are expected to reduce between 10 percent and 30 percent with the full implementation of cross-border paperless trade, increasing the export potential of the Asia Pacific region by more than $250 billion. Such agreements help with compliance of international standards, harmonization of rules and regulations, reducing capacity gaps in infrastructure and human capital as well as improving cooperation between different stakeholders in the economy. They can also aid the improvement of productivity at the firm level, ensuring that firms strive to become more competitive in the global market. It is recommended that Pakistan accedes to agreements that can help improve its trade connectivity, while incorporating the role of digital technologies in trade to aid the growth of its exports.

3. Government support to small medium enterprises (SMEs): The role of SMEs in international trading activities needs to be enhanced to improve the competitiveness of the trading environment in Pakistan and to ensure better diversity in the export composition. The current trade policies are biased towards larger firms as the smaller ones struggle in accessing financial markets and government incentives. A recent study by the Sustainable Development Policy Institute (SDPI) recognizes the importance of easing the business environment on smaller firms, recommending improved business facilitation by agencies such as SMEDA and TDAP. The government must reach out to SMEs to facilitate their business operations and their participation in international trading activities.

4. Expanding access to information for exporting firms: The key to improving the ability of Pakistani exporters is to ensure that they have access to information that helps them produce the right mix of goods as demanded by the consumers in their targeted markets. This not only involves improving the quality of the trade missions abroad to establish stronger trade linkages but also improving the quality of portals providing trade information and on business processes surrounding international trade – this will enable smaller exporters to better participate in trading activities. The government must ensure that exporters receive the right set of information on export destinations, not only through the trade missions but also through various information portals.

In conclusion, it is apparent that Pakistan has not only become relatively less open to trade than its regional competitors but has also reported low levels of growth in its manufacturing capabilities over the last two decades. This has significant consequences on the challenges of economic growth and the balance of payment management for Pakistan. This paper has analysed Pakistan’s trading patterns, as well as its level of industrialisation, and has provided a few recommendations as a way forward to address the challenges as the productivity dilemma continues to exacerbate the competitiveness of Pakistani industries.

Aadil Nakhoda

The writer is an Assistant Professor of Economics & Research Fellow at CBER, School of
Economics and Social Sciences, Institute of Business Administration (IBA), Karachi. Member,
Economic Advisory Group at PRIME Institute

The post How To Tackle Pakistan’s Export Crisis? appeared first on Dissent Today.

The scale of the economic challenge we as a nation face is best summarised by Figure 1. While labour productivity in Pakistan only increased by 45%, labour productivity in Bangladesh, India and China (not reported) saw an increase of 190%, 263%, and 790%, respectively, over the last three decades. What is more revealing is that, compared to these countries, the increase in labour productivity has been the lowest across almost all the sectors in the case of Pakistan.

An obvious question that comes to mind is why has Pakistan lagged behind relative to its neighbouring countries? And what can be done to reverse this trend?

To better understand why Pakistan has lagged behind its regional peers in terms of labour productivity, it is important to start by recognising that labour productivity depends on both the level of productivity and the physical capital available for production. This distinction between the level of overall productivity and the physical capital as two driving factors underlying labour productivity is of critical importance. The popular discourse on labour productivity often ignores the role of physical capital and confuses it with productivity in general. This is a mistake.

In the rest of this article, I discuss both the role of productivity and physical capital to explain why labour productivity in Pakistan has increased by so little since 1990s.

In an exercise done by this author, a one percent increase in productivity can potentially increase Pakistan’s GDP by 2.53%. This is significantly higher than what Jones (2011) estimates for most other economies. However, the overall productivity growth in Pakistan has remained abysmal to say the least.

Figure 2 plots the annual productivity growth for Pakistan for the period between 1968 and 2018. Since 1968, the average productivity growth is estimated to equal 1.24%. It was only for the short period in the 1980s that the average productivity growth reached close to 3%. The 1990s and the 2000s once again saw the annual productivity growth fall below 1%. It then increased to 2.5% during the recent decade. The key message that comes out of this exercise is that, despite significant benefits in terms of economic prosperity, the productivity growth rate has continued to fall short of what is required to sustain long periods of high economic growth.

But once again we are forced to ask a question, why has productivity growth remained low in the case of Pakistan? In one of his lectures, Charles Jones notes, “Poor countries are poor partly because of few inputs but also because of inefficiency in using those inputs.” In a similar spirit, Franklin Fisher had earlier remarked, “In dealing with actual economies, the barriers (for resources to move) may be more important than the frontier.” It is easier to appreciate this if one considers that, over the past five decades, almost 40% of the growth in GDP per person for the United States came from the better use of its human resource i.e. right person for the right job. The potential benefits for developing economies from improving how they use their existing resources are also enormous.

To better understand why Pakistan has lagged behind its regional peers in terms of labour productivity, it is important to start by recognising that labour productivity depends on both the level of productivity and the physical capital available for production.

Conceptually, the poor use of resources affects a country’s development prospects by undermining overall productivity. For example, Hsieh and Klenow (2009) show that inefficient utilisation of resources may reduce productivity by about two to three times in the case of China and India. In its vision document, the Economic Advisory Group cites several examples from the literature showing how several of the developing countries improved their overall productivity by letting their existing resources move to more productive activities. Meza et al. (2019) show that 41% of the increase in Mexico’s productivity between 2003 and 2012 was because of improvement in allocative efficiency, i.e. due to economic resources moving from less productive to more productive activities. Improvement in allocative efficiency was an important part of productivity growth during Chile’s decade-long period of growth following the debt crisis of the early 1980s (Chen and Irrazabal, 2015).

At the onset of the 2013 crisis, organised sectors and businesses linked to powerful families successfully lobbied to increase trade protection in the form of non-tariff measures to protect themselves from international competition.

In the context of Pakistan, the two broad themes which have the potential to cover much of the ground on inefficient use of economic resources are trade protection and the low levels of labour mobility. Pakistan undertook significant trade liberalisation during the 1990s and the 2000s. The tariff rate came down from more than 50% in the 1990s to less than 20% in the late 2000s (Malik and Duncan, 2022). The authors show that much of this progress was partly reversed during the last decade. However, while the focus on the average tariff rate gives useful information on the degree of protection from international competition, it hides important sources of distortions. A closer look at the data shows that the effective rate of protection enjoyed by the sectors dominating Pakistan’s economy is substantially higher (Varela et al., 2020). It is this excessive protection of traditional sectors from international competition which prevents Pakistan’s economy from adapting to the requirements of the 21st-century economy.

The second theme centres around low levels of labour mobility. Consider the fact that only 15% of the total migration that happens within Pakistan happens for economic reasons (LFS, 2021). Understanding why this is the case requires asking if this is due to a lack of affordable housing; poor transportation network; issues around security of life and property; dependence on social networks due to unreliable provision of public goods such as health care; Or lack of opportunities. Pakistan, as a country with a relatively abundant labour force, has enormous potential in competing globally in products which use labour more intensively in production. But if the country’s labour force cannot relocate in response to the needs of the economy, the potential benefits from integrating with the rest of the world will not materialise.

The two themes discussed above leave much else to be desired. Some of these include liberalising pricing regimes and replacing minimum support prices with instruments such as crop insurance for small farmers; revamping the education system with the aim to introduce and mainstream pathways for vocational training at the level of higher and post-secondary education; designing appropriate tax policy to discourage speculative investments in both urban and farmland; undertaking judicial and civil service reforms; and, importantly, the democratisation of political parties (EAG, 2020).

However, addressing the structural issues mentioned above is often not straightforward for both political and technical reasons. On political reasons, Jones points to the economic interests of the ruling elite as an important factor behind why a country’s resources are not used efficiently. Jones (2013) says, “The state-of-the-art in that literature suggests that misallocation is the equilibrium outcome of a political process interacting with institutions and the distribution of resources (including physical capital, human capital, ideas, and natural resources). It is, evidently, not in the economic interest of the ruling elite to improve the allocation of resources, despite the potentially enormous increase in the size of the economic pie that is possible in the long run.”

In a recent paper published by PIDE, Adeel Malik and William Duncan document this phenomenon in the context of Pakistan. They show how at the onset of the 2013 crisis, organised sectors and businesses linked to powerful families successfully lobbied to increase trade protection in the form of non-tariff measures to protect themselves from international competition. Likewise, the 2018 crisis saw a sharp increase in import duties in sectors linked to powerful families. The 2022 crisis has proven to be no different.

On the technical side, Fisher reminds us, “It is very risky to look at a planned economy and predict where it will end up if it shifts to a system of free markets.” Likewise, Yao (2014) says, “High growth is not granted when a command economy is transformed into a market economy.”

However, these challenges are not specific to Pakistan alone. As low as it might first appear, the average productivity growth in Pakistan is not too different from what is observed for the rest of the world. For example, since 1980, the average annual productivity growth in the case of India has been 1.5%. The same for Pakistan has been 1.4% over the same time period. In fact, Pakistan’s average productivity growth has been three times higher than the rest of the world. Figure 3 plots the distribution of annual productivity growth for the country-year pair. There are two important points to note. First, there is considerable variation in the annual productivity growth across country-year. Second, the average annual productivity growth across country-year has only been 0.4%.

A cursory look at the data also suggests that there is no obvious relationship between the level of economic development and productivity growth. The correlation between annual productivity growth and the level of GDP is close to zero. In other words, it is not the case that countries at any level of economic development experience faster productivity growth on average.

This observation is not new. There is already considerable literature showing that the contribution of productivity growth to the East Asian growth miracle was rather unimpressive. For example, Collins and Bosworth (1996) estimate that, while GDP per capita grew at an average rate of 4.2% over the period from 1960 to 1994, the contribution of productivity growth to the annual GDP per capita growth rate was only 1.1 percentage points on average.

Admittedly, the above discussion should not be taken as conclusive. There are countries which succeeded in achieving high growth rates driven by continuous improvement in productivity. For example, output per hour increased at an average rate of 3.3% in the US between 1948 and 1973. Jones (2016) shows that almost all of it can potentially be explained by advances in productivity.

Moreover, methodological choices can also change results substantially (Barro and Sala-I-Martin, 2004). For example, taking a different approach, Hsieh (2002) shows that the contribution of productivity growth to annual GDP growth for Taiwan increases from 2.1 percentage point to 3.7 percentage point. The same for Singapore increases from close to zero to 2.2 percentage point.

The more relevant question in the context of this article is how else can the countries sustain long periods of high economic growth. After all, countries across the world have made substantial gains when it comes to improving the living standards of their citizen without a substantial increase in their overall productivity. This provides the motivation for understanding the role of physical capital as the second key driver of improvements in labour productivity.

It is argued that for countries which are broadly similar, the country with less physical capital will offer higher returns on investment. As a result, if these countries were to open up their economies to foreign investment, they will experience an inflow of capital which will contribute to their economic development. While this is not always the case, this is certainly true for several emerging economies, including India and China.

Figure 5 shows that, as India and China opened up their economies to foreign investment in the early 1990s, they experienced a significant increase in inflows from international private investors (blue bars).

In contrast, while Pakistan has also seen investment from international private investors, these inflows have not sustained for longer. In effect, most of the non-debt-creating inflows are concentrated in a few years during the last three decades. Figure 6 shows that the only time net private equity inflows remained above 2% of GDP for more than a year was in the mid-2000s.

By not accumulating reserves, policymakers have effectively prioritised today’s consumption over future consumption. Indeed, in doing so, they have effectively left the citizens worse off.

In addition to foreign investment, domestic investment in these countries has increased as well. For example, the gross savings rate (as % of GDP) increased from close to 15% during the 1980s to more than 30% in the 2000s.

China and Bangladesh have also seen a significant increase in their savings rate during this period, except that the increase for China is smaller due to an already high savings rate, to begin with. In contrast, the gross savings rate for Pakistan has declined over the same period.

Why is it that both foreign and domestic investment has not increased in Pakistan despite Pakistan having comparable socio-economic conditions to the rest of the countries in the region? Like always, there is no one good answer to a question as important as this. Nonetheless, I put forward the reason which I think is most important: macroeconomic risk in the form of frequent currency crises.

The best way to visualise how macroeconomic risk may affect firms’ investment decisions is through Figure 7. Figure 7 plots the annual return on a KSE100 five-year index fund. I select five years since it matches the average duration of the business cycle and, as a result, is most suited to capture macroeconomic risk. Two things stand out. First, the average return on this index fund equals 16%. In real terms, the average return equals 8%. Second, the standard deviation (i.e., risk) is also quite high at 17%.

The two observations are of critical importance. The higher average returns are consistent with the notion that less developed countries tend to offer higher returns on investment. As a result, liberalising the economy should result in an increase in investment. However, there is also considerable macroeconomic risk associated with undertaking investment in Pakistan. The average return of 16% and standard deviation of 17% means that the Sharpe ratio is less than one, thus making both foreign and domestic investment less attractive.

This simple observation has important policy implications. A better set of macroeconomic policies which lower the risk of repeated currency crises can go a long way when it comes to incentivising investment and bringing about substantial improvements in labour productivity. The set of macroeconomic policies which help achieve this is well known. However, in the context of Pakistan, the role of accumulating foreign reserves deserves additional attention.

Figure 8 highlights an important difference between Pakistan and the regional economies discussed above. While all the economies received a varying degree of private inflows over the four decades, all the countries except for Pakistan used these inflows to accumulate foreign reserves. In fact, China accumulated more in foreign reserves than the net private inflows it was receiving in any given year for more than a decade. It is easy to appreciate that the macroeconomic risk in developing countries with large reserve cover is definitely less than in the case of countries which don’t.

In the discussion above, I have stepped back and taken a broad view of both the structural and macroeconomic challenges Pakistan face. Without going into technical details, I have also hinted at several of the reform measures the policymakers can take to address these challenges and lead Pakistan’s economy out of the quagmire it is stuck in.

However, the discussion skips several important questions which are arguably more fundamental to understanding the challenges highlighted above. For example, by not accumulating reserves, policymakers have effectively prioritised today’s consumption over future consumption. Indeed, in doing so, they have effectively left the citizens worse off. But why is it the case that policymakers in Pakistan prioritise today’s consumption more than policymakers in our neighbouring countries? Second, while I am equally guilty of doing this above to get my arguments across, there is no good reason to believe that what is ‘macroeconomic’ is independent of what is ‘structural.’ It is very much likely that the structural problems which prevent sustained growth also force policymakers to bet on expansionary (procyclical) policies to deliver short periods of growth for electoral victory. But, if so, what prevents the politicians from addressing these structural bottlenecks that ultimately give way to irresponsible macroeconomic policies? I leave it to the reader to explore the answers to these questions.

Ahmed Pirzada

The writer is Chairperson of Economic Advisory Group, Pakistan; Senior Lecturer in Economics,
University of Bristol; and, Fellow of Higher Education Academy, UK.

The post Labour Productivity In Pakistan: Why Are We Falling Behind? appeared first on Dissent Today.

The state of rule of law in Pakistan today is dismal to say the least. Even when laws protecting human rights exist, their poor implementation not only renders them ineffective, but also creates a sense of mistrust among the public. For the powerful, law is a privilege, but for the weak, it is a trap from which there is no escape. 

In Pakistan, law enforcement agencies are not only involved in custodial torture of the accused, but are also accused of having a role in several cases of enforced disappearances in Balochistan, Sindh, and Khyber Pakhtunkhwa. No one is being held accountable for these actions.

According to the doctrine of the rule of law, law should be accessible and inexpensive to all citizens on the basis of fairness and equity, and justice should be dispensed without delay or excuse. None of these principles are being followed in Pakistan.

Pakistan’s justice system particularly fails marginalised groups. If you are from a low socioeconomic background or belong to a religious minority group, attaining justice is nearly impossible.

In 2021, World Justice Project’s Rule of Law Index ranked Pakistan 130th, indicating that the country has one of the poorest judicial systems in the world. People’s lives, properties, and dignities are frequently violated, and the institutions that are supposed to implement the law are helpless before the perpetrators. 

Another important challenge facing Pakistan’s justice system is an overwhelming number of unresolved cases in the courts. Justice delayed, as they say, is justice denied. And as a result of such delays, people’s trust in the courts is eroding, shattering their confidence in the judicial system, which is why the feudal system involving jirga and panchayat (village councils) continues to run parallel to the formal justice system. 

Pakistan’s justice system particularly fails marginalised groups. If you are from a low socioeconomic background or belong to a religious minority group, attaining justice is nearly impossible. Moreover, women are discouraged from reporting crimes due to the misogynistic attitudes of the police, judges, and even lawyers and society as a whole.

Also concerning is the lack of awareness among people about the rights guaranteed to them under the Constitution. In rural areas, feudal lords have connections with the administration, police and the judiciary, and are therefore able to get away with crimes. Powerful individuals conveniently use their influence to evade the law.

The state must work towards ensuring supremacy of the law, which is the only way to put the country on the path of progress. The state and its institutions should be devoted to the people of Pakistan and not to a bunch of influential individuals. 

The state must abolish the feudal system while undertaking land reforms, particularly in Sindh and Balochistan, to ensure equitable distribution of wealth and an end to exploitation. Pakistan also needs provincial autonomy, investment in social services and industry, free scientific education, equitable opportunities, and the inclusion of youth, peasants, researchers, and women in policymaking. Such efforts can only be accomplished through structural reforms.

Jalila Haider

The writer is a social and political activist, working as a legal practitioner in Balochistan for the last ten years. She has a Masters in International Human Rights Law from the University of Sussex, UK.

The post Why Is Rule Of Law Still A Distant Dream In Pakistan? appeared first on Dissent Today.

The official data reported in the Pakistan Economic Survey 2020-21 shows that the annual growth rates of wheat, rice, and cotton yield per hectare have declined since 2000 (GoP, 2021). Empirical evidence on agricultural Total Factor Productivity (TFP) growth in Pakistan also suggests that it has declined over the past two decades. For instance, Fuglie et al. (2012) estimated Pakistan’s TFP growth per annum as 3.21% for 1984–1990, 1.19% for 1991 – 2000, and only 0.59% for 2001–2009. Siddique (2020) estimated the TFP growth rate for the 1980s as 1.14% per annum, 0.90% in the 1990s, –0.7% in the 2000s, and 1.66% in the 2010s. All these studies merged data from the crop and livestock sectors, which makes it difficult to draw conclusions about productivity trends in crop agriculture alone.

In two background papers to the World Bank’s Pakistan Country Economic Memorandum (World Bank Group, 2022), we provide new evidence on the productivity trends in Pakistan’s crop agriculture and the sensitivity of crop yields and productivity to climate change (Burki et al., 2022a, Burki et al., 2022b).

Crop agricultural productivity and sensitivity to climate change

Based on data from 1993 to 2019, Burki et al. (2022a) showed that TFP in Pakistan declined at an average annual rate of –1.15%, mostly due to failure to improve existing technologies, deterioration in farm management practices, and diseconomies of both scale and scope. These results conceal the TFP growth patterns in the four provinces. TFP in Punjab Province grew at an annual average of 0.44% (far slower than TFP growth in earlier decades), which can be attributed to growth in the uptake of technology (at 2% per annum) and diseconomies of scale and scope (at − 1.4% per annum). TFP growth in Sindh was 0.59% per year, largely because of the combined effects of growth in the uptake of technology (0.88% per annum) and a decline due to diseconomies of scale and scope (–0.33% per annum). However, two smaller provinces, Khyber Pakhtunkhwa (KPK) and Balochistan, witnessed large TFP declines at average annual rates of –1.1% and –4.6%, respectively, mainly because of the large technological regress (at –1.26% per year in KPK and –4.51% per year in Balochistan).

This was corroborated by farm-level data from wheat, rice, sugarcane, and cotton farms in Punjab. For example, Burki et al. (2022b) investigated the impact of spatial variations in extreme weather patterns on crop yield and TFP in the Punjab Province of Pakistan. Evidence of recent trends shows that, on average, the farm level TFP of wheat, rice, sugarcane, and cotton farms in Punjab declined over the period 2013 – 2020 at average annual rates of 4%, 2%, 3.2%, and 4.6%, respectively. The least productive small (<5 acres) and medium (5 – 12.5 acres) farms hold a large share of gross output as they account for 60% of the total cultivated area in Punjab, which contributed to a decline or slowdown in the aggregate TFP of the four crops. Measuring farm size by landholding, the average TFP of large wheat, rice, sugarcane, and cotton farms was at least 9-times higher than that of small farms, and at least 4-times higher than that of medium farms. These results imply that TFP can be significantly increased by adopting policy measures that help raise the TFP of small and medium farms and by moving away a higher share of production from small and medium farms towards large ones. Based on the phenology of wheat, rice, sugarcane, and cotton crops, the TFP and yield of these crops are highly susceptible to elevated temperatures and variations in rainfall during the growing seasons (Burki et al., 2022b). Wheat crop is adversely affected by elevated temperatures during milk maturity and maturity growth phases (i.e., the last 27 days of the crop cycle). A one standard deviation (1-SD) increase in the sum of temperatures above 25°C in this phase is projected to lower TFP by 34% and per acre yield by 25%, which amounts to a reduction in wheat yield by 320 kg per acre or 8 maunds. Similarly, the sensitivity of rice crops to higher temperatures peaks in the reproductive phase, and to higher rainfall in the vegetative and reproductive phases. Likewise, sugarcane crops are impaired by extreme temperatures during the germination phase, whereas cotton crops suffer the most damage because of higher rainfall during the emergence and leafing stages and extreme temperatures during the leafing stage. In the future, extreme weather events are expected to occur with a greater frequency and severity in both temperate and tropical regions. With the extreme weather expected in this region, all major and minor crops are extremely vulnerable to climate change.
How can productivity be enhanced – the way forward?

Technology and innovation are major long-term drivers of agricultural productivity growth in Pakistan and there is ample room for improvement. Over the last two decades, the production possibility frontier has expanded slowly in Punjab, has not expanded in Sindh, and contracted in KPK and Balochistan. This clearly suggests the need to make public and private investments in agricultural research and development (R&D), which can lead to the development of relevant cultivars, new high-yielding cereal and non-cereal seed varieties, development and upgrading of agricultural machinery, and farm management practices. R&D can also help to improve the quality and provision of high-quality seeds. Introducing effective controls on the marketing of substandard seeds in the unorganized sector (informal seed market) can also contribute to more productive agricultural activity.

Empirical evidence shows that increased capital deepening through agricultural mechanization improves TFP by increasing the economies of scale and scope. Hence, policies that increase private investment to raise the stock and quality of agricultural machinery can become effective levers for increasing TFP in the crop agriculture sector. The development of new technologies and innovations can increase the efficiency and productivity, reduce costs, and improve the quality of agricultural production.

More measures include long-term investments in education, training, and alignment of crop extension services to accelerate the distribution of technology to lagging areas so that farmers can adopt new agricultural practices and technologies to improve the technical efficiency of farming operations.

An analysis of the sources of TFP and efficiency reveals that crop specialization is a dominant source of productivity growth. Districts producing a large share of value-added crops have the highest TFP and technical efficiency elasticity, indicating that specialization, considering comparative advantage, can pay the highest dividends.

Policies that increase private investment to raise the stock and quality of agricultural machinery can become effective levers for increasing Total Factor Productivity (TFP) in the crop agriculture sector.

Government policies such as subsidies, trade policies, and price controls, especially wheat support prices, directly affect crop production and producer prices. Low expected returns to growers lead to changes in the scale and input mix, leading to lower economies of scale and scope, which impact long-term growth in TFP. A move towards gradual liberalization of the product market can pay dividends in the form of long-term TFP growth.

Provision of adequate infrastructure, such as transportation networks, storage facilities, and irrigation systems, can enhance long-term growth in TFP and efficiency, and reduce post-harvest losses. Investment in road and transportation systems and storage facilities can provide greater access to local and international markets at higher producer prices, which in turn can raise TFP by improving economies of scale and scope. Moreover, the availability of irrigation water at affordable prices is a critical factor in crop agriculture, and policy reforms aimed at effective water management, water-use efficiency, and water scarcity considering climate change are urgently needed.

Large variations in production frontiers can also be partly attributed to climate change-related variations in yield, which warrant adaptation to mitigate the impacts of climate change. Policymakers may want to adopt practical steps to persuade farmers to adapt to climate change These can include recommendations to change schedules of sowing and harvesting in the light of late arrival of winter season, developing new cultivars that are resistant to high temperatures, introduction of early harvesting shorter duration varieties that are suitable to grow in vulnerable districts.

Biotechnology can be used to improve plant traits including water-use efficiency, heat tolerance, and frost resistance. To maximize gains, these technologies can be secured in developed countries, made economically accessible, and widely disseminated. Finally, new private sector research on genetically modified technology can help provide high-temperature-tolerant seeds for major crops, although issues pertaining to intellectual property rights and fair returns to private investors can hinder their best use. Therefore, public intervention may be required to adopt corrective measures in the case of market failure.

Abid Aman Burki

The writer is an adjunct Professor of Economics at LUMS CNM Department of Economics, where he was a regular faculty member from 2002 to 2021, most recently as a Professor of Economics.

The post How To Improve Pakistan’s Crop Agriculture? appeared first on Dissent Today.

In this article, I will present an overview of the state of knowledge, institutions, policies, plans, and strategies that deal with climate change at both national and provincial levels in Pakistan. It is imperative to first understand what the global climate discourse is, and how far Pakistan’s policies and action plans are aligned with the global parlance, particularly the science as summed up in the IPCC reports and action orientation as adopted in the Paris Agreement. A stronger alignment of climate action with global discourse is important for Pakistan in order to benefit from international scientific research, technology, and international climate finance.

Let’s first have a summary of the global trends in climate science and its bearing on Pakistan’s climate policies and actions. This will be followed by an assessment of Pakistan’s climate-related institutions and their mandates. Finally, I will present a review of policies ad plans through the prism of Pakistan’s commitments, made in its NDC, or the Nationally Determined Contributions. The article underlines the need for Pakistan to upgrade its policy landscape and regulatory architecture to meet the Paris Agreement. 

1. State of the Existing Knowledge  

This is not a comprehensive or exhaustive review of the existing literature, but a bird’s eye view of some of the more prominent studies and policy documents that have informed and shaped the climate discourse in the country. 

Genesis of Climate Policies:

No other scientific source has informed and influenced the global climate discourse, including Pakistan’s national climate policies, than the Fourth Assessment Report by Intergovernmental Panel on Climate Change (IPCC) released in 2007. This report, known as AR-4 attributed, for the first time, global changes in climate change to anthropogenic factors (IPCC, 2007). Soon after the AR-4 was released, Pakistan Planning Commission set up a Task Force on Climate Change (TFCC) in 2008 to investigate the impact of climate change on the country’s agriculture, economy, energy, and water. The TFCC was the first serious effort in Pakistan to understand the effects of climate change and to devise an adaptation strategy for Pakistan based on IPCC reports. It provided a comprehensive framework for addressing issues that Pakistan faced due to changing climate (GOP, 2010).

Subsequent policies in Pakistan are indebted to the structure and contents of the TFCC report, particularly the National Climate Change Policy 2012 (GOP 2012), Framework for the Implementation of Climate Change Policy 2013 (GOP 2013), and the Nationally Determined Contributions 2016 (GOP 2016). All these documents were developed prior to the special reports by IPCC, released after the Paris Agreement (IPCC 2018, IPCC 2019, IPCC 2019b).  The Special Report on Global Warming of 1.5°C needs a specific mention as it examined various pathways to limit warming to 1.5°C, what it would take to achieve them, and their consequences. It explained that global anthropogenic carbon dioxide (CO2) emissions would need to decrease by about 45% from 2010 levels by 2030, reaching net zero by around 2050. The report also acknowledged that limiting warming to 1.5°C would require the use of “negative emissions technologies” (NETs), often known as carbon sequestration, in order to bring warming back down if global temperatures do overshoot 1.5°C, large-scale use of NETs will be required. Two subsequent reports issued by IPCC on the request of the secretariat of the climate change convention, known as the United Nations Framework Convention on Climate Chante (UNFCCC) have only added to the urgency for accelerating climate actions and efforts in all sectors. 

The Mainstreaming Challenge: 

With these reports, global and national efforts have decisively moved towards climate resilient and low carbon development, reflected in the global discourse on resilient development through net zero emissions and decarbonization. This new global knowledge was adopted by the international community as Paris Agreement. As we will see now, most national climate and sectoral policies in Pakistan have not been systematically aligned with Pakistan’s commitments made under the Paris Agreement. The mainstreaming of climate change, therefore, continues to be a serious national and provincial level challenge. A new set of policy reforms and regulatory mechanisms will be needed to comply with the recommendations of AR-6. 

Most of Pakistan’s federal policies and guiding documents have not embedded climate change. Except for the National Water Policy, climate change continues to be a standalone concern in Pakistan’s national policy milieu, barely getting more than a passing reference. The provincial documents rarely mention climate change, betraying the state of existing knowledge, research and human resource capacities. Punjab Growth Strategy 2015 (GOPb 2015) did not even mention climate change and its revised version that covers 2019-2023 (GOPb 2019) has also not systematically addressed climate change. Likewise, Sindh Poverty Reduction Strategy 2020 (GOS 2017), KP Integrated Development Strategy 2014-2018 (GOKP 2014), and Balochistan Comprehensive Development Strategy 2013-2020 (GOB 2013) that are supposedly provincial planning documents, do not have any reference to climate change. These documents have not acknowledged the existence of the National Climate Change Policy (NCCP), the Framework for the Implementation of Climate Change Policy (FICCP), or the actions committed by Pakistan in its ‘Intended’ Nationally Determined Contributions (NDC) submitted to UNFCC secretariat. All these documents were presumably developed after seeking comments from the provincial or engaging them in consultative processes.   

There are no regular annual reports on the state of climate change or the environment at national or provincial levels, nor there is a repository where the reports could be accessed. Except for the Sindh State of Environment & Development which was printed 20 years ago (IUCN 2004), there are no national or provincial reports on the state of the environment or climate change printed by any national or provincial government. The first report released by the Ministry of Climate Change (MoCC) was the Environment and Climate Change Outlook of Pakistan (MOCC and UNEP 2014), followed by the Annual National Report on Environment of Pakistan in 2016 (MOCC 2016). There were no subsequent annual reports. Likewise, MOCC has not released any periodic status reports on the implementation of NCCP, FICCP, or NDC implementation. This is a void that has not been filled by think tanks, universities, UN agencies, bilateral donors or multilateral development banks. 

Most of Pakistan’s federal policies and guiding documents have not embedded climate change. Except for the National Water Policy, climate change continues to be a standalone concern in Pakistan’s national policy milieu, barely getting more than a passing reference.

From among the multilateral development banks, the World Bank’s flagship study, Pakistan Strategic Country Environmental Assessment Report in 2006 estimated that environmental degradation was costing Pakistan’s economy 6 percent of GDP. Two years later, the Asian Development Bank (ADB) released its Country Environmental Analysis in 2008 (ADB, 2008), followed by a comprehensive compilation on the Climate Change Profile of Pakistan (ADB, 2017). The World Bank has also recently released Opportunities for a Clean & Green Pakistan: A Country Environmental Analysis (World Bank, 2019). Whereas the ADB profile provided a summary of ADB initiatives and ADB’s climate risk screening approach, the World Bank report focused, among others, on strengthening regulatory frameworks for air quality, toxic waste, industrial policy, and water quality. The most comprehensive and seminal report in this regard is CCDR, or the Climate Change and Development Report (World Bank, 2022). The CCDR has pointed out that the combined risks of extreme climate-related events, environmental degradation, and air pollution are projected to reduce Pakistan’s GDP by at least 18 to 20% by 2050. 

Economic Cost of Climate Change:

There are no systematic or scientific studies to measure the economic cost of climate change, not there are any mechanisms in place to collect data and release periodic reports and projections. The cost of climate-induced disasters in Pakistan started primarily with the Preliminary Damage and Needs Assessment in 2011, following the super floods (GOP, ADB, World Bank. 2011). Earlier in 2014, a study by ADB had estimated that the economic cost of climate change would increase over time for South Asia and become the equivalent of 1.8 per cent GDP by 2050 (Mahfooz Ahmed, et.al, 2014). The World Bank in 2018 undertook an assessment of how climate change will adversely affect the standard of living in South Asian countries (Mani 2018). There are no key sectoral studies for agriculture, water, hydroelectricity, or water-induced disasters. The cost of development was projected by (Markandya, 2018), arguing that Pakistan would find it not possible to meet its growth or SDG targets.

Except for the climate public expenditure review by UNDP (UNDP, 2017) showing that Pakistan was spending about 8 per cent of its budget on activities related to climate change, there are no other studies regularly estimating the economic cost of climate change. The NEEDS study had projected resources needed for adaptation (UNDP 2011) and mitigation (UNDP 2011a). The CCDR has presented estimates of climate costs to various sectors but as for the Government of Pakistan, Pakistan Planning Commission in October 2022 released its Post-Disaster Needs Assessment (PDNA) report presenting sectoral estimates of damages and losses in various sectors because of 2022 Super Floods (GOP, Planning Commission, 2022). Providing an analysis of the impact of a disaster on a country’s social, economic, and physical infrastructure, the PDNA has committed to resilient reconstruction. It has included a resilient recovery strategy that outlined the steps needed to rebuild and recover from the disaster. Except for initial efforts by UNDP (GOP 2017) or CCDR (2022) mentioned earlier, there are no systematic efforts to mainstream climate change into public economic and financial management. 

Climate Modelling Gaps:

Pakistan’s capacity for climate projections is limited and underutilised, especially for climate, hydrological, economical, and agricultural modeling capacity. In fact, the capacity has stagnated over the years and now the National Institute of Oceanography (NIO) has ceased to monitor seawater rise. Global Change Impact Study Center (GCISC) is the research arm of the MOCC charged to undertake scientific research and provide information on climate change and its impacts in Pakistan. Established in 2002, it initially undertook some studies of climate impact on agriculture and water but it no longer undertakes studies to measure or project the climate impacts on various sectors. SUPARCO has used its satellite imagery to monitor change in forest cover and Pakistan Met Department (PMD) has used outputs of Global Climate Models (GCMs) for downscaling at a regional scale using Regional Climate Models (RCMs) on its supercomputing facilities. Only a handful of universities or research centres have developed computational resources to perform simulations. The capacity in water and climate modelling is probably stronger at universities than at government research institutions. The government’s research centres, however, are not connected with academia and there are hardly any protocols for data sharing, models, computational resources, and capacity coordination. The policy interventions are needed to enhance data sharing and reuse, support improved scientific and technical data management and good practices by promoting Open Science and FAIR (findability, accessibility, interoperability, and reusability) data principles. 

Sectoral Research Gaps:

Environmental Issues: Many environmental issues have received some attention, even if there is hardly any time-series data on these issues by federal and provincial governments. There are mostly case studies on air and water quality, pollution, industrial discharges and generally dealing with specific water bodies. Note for example, studies on drinking water (Daud, MK, Nafees, M, Ali S, et. al (2017), water shortage, and pollution from a public health perspective (Nabi, Ghulam; Ali, Murad; Khan, Suliman & Kumar, Sunjeet. (2019), or on water pollution as a risk to public health (Sleet, Phaebe (2019). There has been some monitoring of pollution load in water bodies, particularly river Ravi and transboundary nullas by WWF and PCRWR. The data on groundwater abstraction by WASAs in several cities is typically fragmented, dated, and generally not accessible.    

Extreme Weather Events: Compared to floods, most extreme weather events like tropical storms, heatwaves, droughts, flashfloods, landslides, and climate-induced migration have received modest attention from research and policy communities.  Heatwave in Karachi in 2013 get some traction from the Ministry of Climate Change, and released a report prepared by a technical committee (GOP, 2015). The government of Sindh developed a Heatwave Management Plan for Karachi (GOS, 2016) and the NDMA released a toolkit for South Asian Cities (GOP, 2016). There have been very few studies on droughts that both Balochistan and Sindh have been in grip of for many years (SDNA 2019). Nutrition and stunting have emerged as major challenges, particularly in Sindh and Balochistan, but there have not been any provincial-level studies (SUN, 2018).  

Air Quality: There has been a growing interest on the issue of air pollution. Starting with a World Bank report (Sanchez and Ernesto, 2014) that focused on cleaning Pakistan’s air, some other scholars (Greenstone, et. al 2019). In reality, most provincial governments stopped monitoring air quality some years ago. Pakistan is regarded as one of the most polluted countries in the world, with air pollution shortening the average Pakistani’s life expectancy by 4.3 years relative to what it would have been if the World Health Organization (WHO) guideline was met. All of Pakistan’s 212 million people live in areas where the annual average particulate pollution level exceeds the WHO guideline, and 99% live in areas where it exceeds Pakistan’s own air quality standard. Some areas of Pakistan fare much worse than average, with air pollution shortening lives by almost seven years in the most polluted areas. The current PM2.5 concentration in Pakistan is 3.5 times above the recommended WHO limit for 24-hour air quality guidelines value. The cities with the highest levels of pollution are Faisalabad, Lahore, Peshawar, and Karachi. Indoor air pollution is also a significant problem in Pakistan due to harmful gases from cooking fuels such as wood, crop wastes, charcoal, coal, and dung, dampness, mold smoke, and chemicals from cleaning materials. 

While Pakistan has air and water quality standards, confusion prevails regarding national and provincial policies. Further, while the standards require some tightening and upgrading, the key challenge is stronger monitoring, data generation, and enforcement.

Water: Water and agriculture and particularly the Indus basin are well-researched, and serve as the backbone of Pakistan’s agricultural economy and food security. John Briscoe’s Pakistan’s Economy Running Dry (Briscoe, et el, 2005) and a report by Friends of Democratic Pakistan have provided a solid foundation for subsequent work on Pakistan: Getting More form Water (William Young, et. el, 2018) and a study on managing groundwater resources (Lytton 2021). In a specific climate change context, impacts of climate risks on water and agriculture, based on revised Indus basin modelling (Winston, et. el, 2013) and the vulnerability of Pakistan’s water sector (MOCC & UNDP 2016) are important primers. Young has provided an elaborate bibliography of substantial work in various fields touching on pricing, productivity and governance. While there have been some significant technical studies on the water sector by the World Bank and others, its nexus with agriculture, resilient infrastructure, and urban vulnerabilities have not as yet been systematically undertaken at the national level, particularly in the context of institutional capacities needed to undertake near- and long-term actions.  

Perhaps no other aspect of the Indus basin has received as much attention as the Upper Indus Basin (UIB), and the receding glaciers. Some aspects that have received special attention include how climate change is impacting the glacial mass, and propelling their melting (Immerzeel, Walter W., et.al. (2010), approaches to GLOF risk reduction (Arshad, Naz & Ruhi. 2015), or the flood hazards in Hindukush, Karakoram and Himalayan ranges of Pakistan (Arshad, Naz and Ruhi (2012). 

Pakistan Council of Research in Water Resources (PCRWR) is the research arm of the Ministry of Water Resources (MoWR). It is mandated to conduct research on water resources and provide guidance to the government on water management policies. It also monitors water quality and provides information to the public about safe drinking water. Several studies by PCRWR on groundwater, particularly the investigation and mapping in the Lower Indus (Iqbal, N, & Ashraf, M, 2020) and Upper Indus (Khan, A.D., et.el, 2016), and (GOP (2016a) are particularly important for their policy uptake. Perhaps no other institution has drawn more attention to Pakistan’s growing water scarcity by linking it to the growing population and declining per capita availability than PCRWR (Ashraf, 2020). 

Seawater: There is no scientific data collection of seawater intrusion or increasing frequency of tropical storms in the country. Most studies on seawater intrusion are based on international scientific literature and come mostly from academic institutions (Sial, A.A., 2018; Rabbani, M.M, et. al 2008) and government institutions. Some researchers have assessed the impact of seawater intrusion on soil, water, and the environment on the Indus delta using remote sensing tools (Siyal, Altaf Ali, 2018). In a similar vein, IUCN study on environmental degradation because of seawater intrusion (IUCN, 2003) and the Bux Mullh survey to study how it was adding to social inequality and shrinking livelihoods (Bux Mullah, Hussain, (2009) have not been updated.

2. State of Institutional Capacities

Pakistan was perhaps the first country in the world that established a ministry dedicated exclusively to climate change. The decision was primarily driven by internal political compulsions rather than any earnest commitment to national climate action. A constitutional amendment in 2012 relegated the environment to the provinces as a subject, and dissolved the Ministry of Environment. In reality, the climate ministry has still not begun to inform the national development agenda, policy planning, or sectoral policies and priorities at national and provincial levels. This is reflected in the state of research or technical and scientific knowledge, institutions, and national and provincial policies and action plans.

To begin with, the NCCP was approved before SDGs, Sendai Framework or the Paris Agreement were signed. Several issues and concerns that have come to dominate national and global discourse are not fully reflected in the policy. A 5-yearly review was proposed in the policy and a revised NCCP, released in 2021 (GOP, 2021) has not fully filled these gaps and it has, instead, simply added some more desirable actions in a long list of immediate, medium, and long-term policy actions. 

As the focal point ministry, MOCC is not only the architect and custodian of the national climate change strategies and policies but it is also responsible for climate planning, mainstreaming, and global reporting on Multilateral Environmental Agreements (MEAs). It is mandated to develop plans and frameworks for  MEA implementation. Additionally, MOCC is responsible for the formulation, revisions, and finalization of the NDCs for submission to the UNFCC secretariat. 

Projects by Pakistan’s bilateral and multilateral development partners, covering such as carbon taxation, national income accounting, blue carbon, modelling (CGI), and energy transition towards decarbonization did not formally follow the climate portfolio in agriculture, water, disaster risks, and urban planning at federal and provincial levels, as defined by climate policies or action plans. No systematic analysis has as yet been undertaken of these projects and their contribution to climate readiness in terms of adaptation or mitigation.

This coordinating role requires strong scientific and technical knowledge and the ability to lead and coordinate federal ministries and provincial departments. In reality, the ministry’s technical capacity has always remained weak. Most of the technical units established were supported by donor agencies and vanished almost always soon after their interest waned. This technical weakness is reflected in the ministry’s inability to work closely with provinces to develop their respective climate policies and action plans, engage with the sectoral ministries and departments to embed climate change in their policies and plans or develop national adaptation and mitigation plans, even if finances form the donors were made available several years ago. The NCCP has presented a long list of desirable actions, including policy measures, but has not actually made any efforts on its own or jointly with concerned sectoral ministries or departments. Most of NCCP and FINCCP targets were not explicitly covered by NDC. There were only scant references to the NCCP and the Framework in the NDC. No mechanisms for climate actions were set by other ministries and departments or for technical inputs from the ministry. No registry was set up to track, document, and showcase climate actions under NCCP or NDC. Except for a partial review by the Climate Change Commission that was set up by the Lahore High Court in 2015 for the province of Punjab, there has not been any systematic stocktaking to determine if federal and provincial governments accomplished the NCCP. 

Some areas of Pakistan fare much worse than average, with air pollution shortening lives by almost seven years in the most polluted areas. The current PM2.5 concentration in Pakistan is 3.5 times above the recommended WHO limit for 24-hour air quality guidelines value.

Except for KP no other province has notified its climate policy nor embedded climate change in their sectoral policies. Most national and provincial policies have not undertaken any cross-referencing to climate change. While some policies have begun to refer to climate change, perhaps not a single one has cross-referenced with NCCP. Except for National Water Policy that was approved in 2018, most other policies that were developed after 2013 such as the Alternative and Renewable Energy Policy 2019) or National Electric Vehicles Policy (2020) have not always been based on the NCCP recommendations. 

MEAs: Pakistan’s initial environmental legislation called Pakistan Environmental Protection Act (PEPA) had to be changed after the 18th Amendment. It had listed 14 MEAs that Pakistan had signed. Even if Pakistan has signed and ratified several other MEAs since then, including the Paris Agreement, the list has not been amended since 1997 when it was first adopted by PEPA. MOCC hosts a unit that manages nine of the original 14 MEAs listed in PEPA, leaving the remaining ones for Pak Environment Protection Agency or EPA to manage. This has created duplication, confusion, and competition on their implementation between the ministry and EPA. Further, there is no coordinating mechanism with the provinces even if many MEAs have a bearing on climate action. Also, there are no coordinating mechanisms in place for several trade-related MEAs that are not covered by any federal or provincial legislation. International trade agreements are increasingly imposing restrictions based on environmental conventions and protocols. For instance, to qualify for the Generalised Scheme of Preference Plus (GSP+) status for preferential trade with EU, countries have to adhere to the Montreal Protocol, the Basel Convention, Stockholm Convention, Convention on International Trade in Endangered Species, Convention on Biological Diversity, Cartagena Protocol, Kyoto Protocol, and UNFCCC. Failure to adhere to these, or any other conventions required for international trade, could potentially result in significant economic losses for Pakistan.

Climate Finance: MOCC represents the Government of Pakistan at several international climate finance institutions, including the Adaptation Fund (AF), Global Environment Facility (GEF), and the Green Climate Fund (GCF). Pakistan is a recipient of several projects from these facilities but since Pakistan has not secured accreditation, Pakistan has secured international climate finance through internationally accredited agencies such as ADB, FAO, UNEP, UNDP. Direct access to concessional financing from GCF and AF will be possible only after securing accreditation. Except for applying for Clean Technology Fund membership in 2013, the Government of Pakistan is not a recipient of Climate Investment Funds (CIFs), managed by the World Bank on behalf of all MDBs. A climate finance unit was established at MOCC, but it has stayed somewhat dormant, if not dysfunctional. In desperation, the finance ministry as well as the Planning Commission are in the process of setting up their own units as are several provincial governments such as KP, Punjab, and Sindh.

Policy Planning: Mainstreaming climate change continues to be a challenge, as it still has to find a place in the country’s policy planning mechanisms. Planning documents that are used as templates by all public sector projects at provincial and national levels (PC-1, PC-2, PC-3, and PC-4 as well as the templates and formats for the development of Concept Notes, Pre-Feasibility, Feasibility studies) have not been climate-proofed. They have been used with some slight changes since the early 1960s when they were first introduced. At the national level, the MOCC is seldom present in the (public sector development programme or PSDP forum that reviews projects at their design and revision stages, even if formally MOCC is a member of the forum. MOCC is also not a member of ECNEC (Executive Committee of the National Economic Council) chaired by the Planning Commission or the National Economic Council (NEC), a forum chaired by the Prime Minister that approves all economic plans and major projects. Climate Change is absent also from all major economic decision-making tools such as GDP measurement, national income accounting, green growth and specific allocations in the annual budget allocations, and provincial Annual Development Plans (ADPs). 

The Economic Survey of Pakistan in recent years has however begun to include a section on climate vulnerability, and the State Bank of Pakistan and the SECP have begun to introduce policies, rules, and other interventions for green investments such as green bonds, and low-emissions fuels and technologies. 

As already pointed out no secretariat at MOCC was notified for NDC implementation, nor a formal inter-departmental or inter-provincial coordinating mechanism was established. The expectation perhaps was that the Climate Change Authority (CCA) will be set up and oversee the implementation of NDC. CCA, together with Climate Change Fund (CCF) and Climate Change Council (CCC) were to be set up under the Climate Change Act that was notified in 2017. CCA, CCF and CCC have not as yet become operational. Given the utmost priority granted to climate change, the Prime Minister’s Committee on Climate Change, for all practical purposes replaced Climate Change Council (CCC) for high-level political decisions during the PTI government. The present government has however operationalised the Pakistan Climate Change Council and begun to convene its meetings.

3. State of Climate Policy Commitments

The NDC Ambition: 

The NDC in 2016 ambitions were very modest and cautious. It deferred climate actions to a future date. It was done primarily to protect the country’s right to development, even if it entailed increased emissions for some decades. The underlying assumption was that an increase in carbon emissions was essential for economic growth and that carbon emissions and economic development cannot be delinked. Further, it was envisioned that the high growth rate will continue with BAU, and even accelerate because of the projected high economic growth rate. In all, the NDC recommended 57 actions of varying nature in the realm of policy. 

The NDC was developed against an overly high optimism of economic growth in Pakistan driven by CPEC and availability of international finance available after the Paris Agreement. Three assumptions were the driving force: 

1. The economic growth rate will be as high as 9 per cent, and there will not be any downward trends. 
2. Pakistan will continue with the BAU and therefore the emissions will grow rapidly, and the share of RE will continue to be nominal
3. International finances will be available generously, without national-level mitigation measures, policy and institutional reforms, and actions.  

Pakistan’s NDC in 2016 did not align with the global discourse on global increase in temperature or carbon during the century, and the need to peak by or before the mid-century, traversing on the road to low carbon development. Projections presented in the NDC were linear, simply projecting that the emissions will continue to grow in the energy and agriculture sectors, and to a lower extent in industrial processes and waste. A combination of relatively weak scientific capacity and under-utilisation of whatever capacity existed the NDC did not build on climate modelling and present Pakistan’s case in a global temperature change context, or changes in local settings. A stronger scientific basis would have allowed the NDC to present 1.5C or 2C or higher degree scenarios for Pakistan’s economy, ecosystems, and society. 

Since sound modelling is an evolving tool where additional parameters can be included, the NDC did not attempt synergy and trade-off between actions in various sectors such as climate, land, energy, water, and other sectors. These include economic growth rate or changes in ratios of energy mix over the years, cropping patterns, migration, and urban planning, or standard of living. 

Economic costs of climate change were all mostly about the losses that Pakistan had already incurred, and not based on any projected increase in the frequency of extreme climate events. What will be the loss to Pakistan’s GDP over the years, under various climate scenarios? There was no economic or business case presented in the NDC for investments in adaptation or mitigation. The NDC presented static figures of the crop, livestock losses, houses damaged by floods during 2010 and 2014 or people killed by 2015 heatwave, without giving any estimates on increased costs of development, infrastructure upgradation, or reduction in crop yields and productivity. Finally, NDC presented losses based primarily on floods and not the losses based on other extreme events or the slow-onset of climate change. It is against this backdrop the abatement costs presented in NDC were also flat, linear and absolute and this reflects a gap to build an economic case for investment to mitigate climate risks. 

It must be pointed out that in recent years, federal ministries and provincial departments negotiated at least 23-climate related projects, in addition to a large number of water and agricultural-related schemes. Most of these projects were initiated, negotiated, and implemented without any direct involvement or knowledge of MOCC. In reality, the ministry and its policy documents have constituted a very small percentage of the total range of climate change-related investments in the country. Not surprisingly, many development partners have undertaken activities – but without always referring to NCCP or the NDC. The existence of such a mechanism would have helped meet national climate change objectives and targets. 

A large number of projects contributed to Pakistan’s climate policies as well as NDC targets without always engaging with MOCC or cross-referencing national policies. Several projects help improve Pakistan’s energy mix in favor of renewable energy. Four hydroelectricity projects are contributing towards 5,61,227 tonnes of Carbon sequestration covering carbon emissions targets of Pakistan.

Instead of refining and revising the assessments because of more frequent extreme weather events and sluggish economic growth rate, the Updated NDC submitted to the UNFCC secretariat in December 2021, built the case based on scenarios presented in the first submission. The life of the Updated NDC will be four years and the revised NDC will be submitted to UNFCC Secretariat in 2025, even if the countries are encouraged to submit their revisions every year prior to the conference of the Parties. Some key areas requiring a closer look are presented below:

Adaptation: 

No actions related to adaptation were envisioned for the first four years (2016-2020). The development of a National Adaptation Plan (NAP) was envisioned during near-term (2020-2025), in order to create a framework for guiding the mainstreaming of medium and long-term climate change concerns into national sectoral policies, strategies, and programmes for a coordinated approach between different tiers of government. 

The medium- to long-term actions (up to 2030) recommended a long list of goals, without any targets where the progress and accomplishments could be measured or showcased. These were only broad statements, without precise targets or specific actions or their prioritization. The provinces, in collaboration with the World Bank and Pakistan’s other development partners, have already taken action on several of the proposed recommendations, even if the projects and interventions are seldom specifically referenced to the NDC as we will see below in Section II.

Mitigation: 

As per Pakistan’s NDC, total GHG emissions are projected to increase by 300% between the period of 2015-2030. The Energy sector maintains a clear dominance in the existing as well as future emissions profile of the country. NDC analysis predicted emissions from the energy sector to rise by a staggering 380% over the period of 2015-2030. This exponential emissions growth dwarfs the trajectories of all other sectors, the second highest increase is projected from Agriculture at 161% over the same period. Hence, the most efficient mitigation pathway for Pakistan would be to focus on the Energy sector, which in turn has underlying drivers spanning multiple sectors. Data from Climate Watch for the year 2017 indicated that the bulk of emissions from the Energy sector in Pakistan is driven by Electricity/Heating (55.9 Mt CO2e) and Transport (53.84 Mt CO2e). Decarbonising these sectors will ensure a green and sustainable growth pathway for Pakistan.   

NDC had ranked carbon sequestration is a low-priority area. The carbon sequestration potential of areas listed under high priority – increased grid efficiency, increased coal efficiency, and large-scale and distributed grid-connected solar, wind, and hydro-energy – was not fully recognised by the NDC. Further, the carbon sequestration potential of afforestation programmes and ecosystem-based approaches, including mangrove plantations, that subsequently became central planks of the national priorities, may result in missed opportunities as carbon sequestration continues as a low priority consideration in project planning. 

In the energy demand and energy supply sectors, no specific targets were set in NDC. In the energy demand sector, the NDC presented several high and medium-priority areas and almost all of these areas required policy and institutional reforms and economic instruments and incentives to engage the provinces. No technical studies were undertaken to define an integrated reform agenda. 

Predictably, the national and provincial ministries and departments have undertaken many actions and many mitigation-related projects that were not envisioned in the NDC. Since 2016, when the NDC was approved, significant projects were initiated that for all practical purposes go beyond the NDC.

The high-level political announcements committing to phase out coal and announcing no-more coal power plants fundamentally increased the country’s ambition. By committing to increasing the share of hydropower to 50 per cent of total energy generation, the Pakistan government demonstrated a desire to increase the ratio of renewables in the energy mix (solar, wind, hydropower, and transportation), shelving some new coal-fired power plants and to substantially increase the ratio of the electric vehicle fleet, starting with two, three-wheelers and commercial transportation. Some initial policy measures were undertaken for the promotion of EVs. The articulation and progress on low carbon development, RE, and decarbonisation have exceeded the narrative presented in the NDC, even if the country began to backtrack soon after making the announcements. 

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Ali Tauqeer Sheikh

The writer is a climate change specialist, focusing on low-carbon and resilient development. 

He is presently a senior Climate Change Advisor at the World Bank in Islamabad.  Sheikh serves on many national commissions and international committees, including the country’s apex climate change body, Pakistan Climate Change Council.

The post Ignoring Climate Change Will Cost Pakistan Dearly appeared first on Dissent Today.

Pakistan, much like the rest of the world, suffered from significant economic shocks last year. Inflationary pressures fueled by a post-COVID and wartime world economy revealed the vast structural deficiencies that have been plaguing the country for years. Political instability and weak governance has prevented the establishment of concrete, necessary economic and social reforms. Today, Pakistan is faced with a severely declining reserve of foreign currency and the depreciation of the rupee – it is hurtling towards bankruptcy.

These are difficult circumstances for Pakistan, as they are for the world. In the face of such severe shocks, Pakistan needs to strengthen its resilience as a state. Such a path, however, does not rely solely on economic policymaking, but deeper strategies to augment its political and social composition. To this end, we would like to share our own experiences in navigating this way forward, in Bangladesh. We now firmly believe that the way forward is the way inward – that the nurturing of any state must start from within, through inclusive politics.

How does one work towards inclusive politics? From our experiences in the Youth Policy Forum, we have learned three pivotal lessons which we would like to share here. First, in the South Asian context, the concept of a development bargain must not only be acknowledged but leveraged; second, youth participation in policymaking is pivotal to reintroduce dynamism in the process of reforms; and finally, any economic transformation must be accompanied by a powerful, all-inclusive coalition of stakeholders working together. We firmly believe that these strategies can and should be replicated in Pakistan, where they have the potential to transform the foundations of Pakistani economics, politics, and society for the betterment of all Pakistanis.

Crafting Successful Development Bargains: Civil Society and Private Sector in Bangladesh

The World Development Report in 2017 had signaled a new approach to understanding the trajectory of economic development in countries, by paying particular focus on the political elite. Indeed, this was particularly relevant in the South Asian context, where political, economic and military elites have played a domineering role in public policy over the last few decades. Consequently, economic transformations hinge on the consent and agreement of ruling elites. This has been defined as the elite bargain, defined as the agreement between elites to ensure power sharing and resource allocation. This concept led to what Dr. Stefan Dercon introduced as the development bargain – where elites shift their priorities from solely protecting their interests to also ensuring positive development futures for their state.

Bangladesh is a textbook example of a development bargain: despite facing significant political instability over the past few decades, its elite have largely upheld the primacy of goals such as economic development and stability. This is, of course, not without cause: the economic growth of Bangladesh is critical to provide the rents the state relies on to preserve itself. However, it has also created favorable circumstances for non-state actors, granting them essential freedoms to operate successfully.

The best example of these are non-governmental organizations (NGOs), which play a significant role in development. The government, acknowledging its own capacity limitations, opened up several spaces of public service (ranging from healthcare to education) for the participation of NGOs such as BRAC and Grameen Bank. These NGOs have worked to actively fill gaps in public service delivery, and have not been obstructed by the government in such endeavors. This contrasts with a case where a government is unwilling to concede its responsibilities to third parties, and at the same time fails to produce the necessary public services its citizens demand.

Similar can be said of the private sector, particularly the garments sector, which overcame the foundations of political patronage in the economy by assuming political roles themselves. This enabled the safeguarding of their industry and the adoption of largely pro-business policies that would ensure the growth of economy and industry in Bangladesh. In Pakistan, the dominance of military elite in economic growth and development is well established and has crowded out the possible role that the civil society can play in development. Much like the case of Bangladesh, there is a need to open up space for the private sector and civil society to play a broader role in development, and more importantly, to fill in crucial public service and economic growth gaps.

Reinvigorating Reforms: Youth as Drivers for Policymaking

There is a surprising dilemma in the history of politics in Bangladesh: countless movements in our proud history over the past half-century have been driven by young people, and yet, today, the average age of our parliament is 59.48 years – well above the global average of 53 years. The reintegration of youth in policymaking has been a prime goal for us at Youth Policy Forum, and it has led to an unprecedented dynamism in the field of policy change for the country.

The foundation for youth participation in policymaking is a basic one: young people have the greatest interest in the incoming future, of which they are central participants. Their perspective is thus critical to ensure the longevity and robustness of public policy. At the same time, they are able to bring in innovation and newfound evidence into the policymaking process. The process of engaging youth in policy, however, is a long one: it involves educating young people, nudging them towards research, and finally encouraging the transformation of their research into tangible advocacy.

Our experiences in Youth Policy Forum have led us to understand that policy education must be completely accessible – thus, it must not only be free of charge, but also in local languages. This enables mass learning, and more importantly, allows for greater understanding of nuances in policy making among general citizenry. These adaptations must not come at the expense of quality: countries such as Bangladesh and Pakistan now sport numerous academics who would be able to adapt their lessons for the young freely and easily, and their skills must be leveraged for policy education.

Not only does policy education enhance the knowledge of audiences, but it paves the way for creation of further knowledge, by granting audiences the skills to pursue policy research and analysis. Young people can leverage digital tools for researching issues they are interested in, and can apply policy methodologies in such endeavors. These efforts, however, must also be accompanied by the presence of a strong, expansive network of other young people to advance policy dialogue and collaboration.

Youth Policy Forum started as a Facebook group for young people to discuss policy together. It is this basis – as a network of young people – that has enabled it to connect young, brilliant Bangladeshis from around the world with stakeholders across the board. Now, young people are able to present their policy insights to actors such as political leaders, civil servants and other key stakeholders, all while being guided by renowned experts. This is an unprecedented policy process, entirely established by and for the interests and competencies of the youth.

Removing the Barriers of Entry in Policy – the Case of Privilege Resistance

It is now evident that South Asian countries have fallen behind East Asian counterparts in terms of economic development. While countries like Japan, South Korea, Singapore, Malaysia diversified their economy and upgraded to high value manufacturing and services, success of countries like Pakistan, Bangladesh, and India has been modest. Recently, Vietnam, Philippines have also upgraded their economy to a large extent. The divergence is vast and dramatic: the value added productivity of the average Pakistani worker in the past three decades has seen a 40% increase; a figure which pales in comparison to the average Vietnamese worker, whose productivity has increased by 328%.

In Pakistan, the dominance of military elite in economic growth and development is well established and has crowded out the possible role that the civil society can play in development.

It is important to understand how East Asia made this transition and why South Asia failed. Work by Alice Amsden on South Korea, Robert Wade on Japan, and Joe Studwell on the region as a whole10 point to the state facilitating learning and productivity of the private sector firms with a strong export performance. Even in Pakistan, firms that systematically export their goods are 26% more productive than those that do so passively; but even such firms are still 21% more productive than those that do not export. East Asian states have made economic upgrading a policy priority across their government, while efforts in South Asia have been dismal. Bangladesh, India, Pakistan all have a lot to learn from the East Asian experience. One lesson to learn is this: for social upgrading, we need economic upgrading, and for economic upgrading we need rapid learning both by the firms, and by the policymakers. This learning cannot happen if the state keeps the private sector closed to a favored few cronies, if the state focuses on preserving rents of its closed allies and keeps subsidizing the losers. Take for example the case of trade in Pakistan: work by Malik and Duncan have demonstrated how politically connected industries (in contrast to politically unorganized industries) have successfully lobbied for higher anti-tariff policies in line with their interests, but harmful towards long term upgrading goals. The role of the state would be to unleash the entrepreneurial spirit of its population, pave the way for learning and innovation, eventually resulting in improved productivity and better living conditions. Pakistan must take a leap out of the book of successful East Asian economies and promote competition and learning, with better investment climate, quality investment on human capital, and reduction of wasteful spending. The first step in this would be to take stock of its potential economic sector which has potential to upgrade, and then have critical conversations on what is stopping upgrading or who is blocking upgrading. The civil society as mentioned above needs to play a critical role in this but eventually it is the powerful business and government elites who have to undertake the painful reforms. They must understand Pakistan cannot continue like this and they have to generate new and productive rents in new sectors. Protecting existing rents for the cronies and vested elites would only strain the already fragile social contract in Pakistan, the time for reform, time for economic upgrading is now. And it would require a coalition among the business, government, and civil society who believe in the true potential of the country and its people.

Conclusion

The economic onslaught of the past few years have revealed the decrepit underbelly of the Pakistani economy and the urgent need for action. It reveals that the wider society has become more important than ever in steering the economy side by side with the state towards a more prosperous and resilient future.

This is a journey that must be made concertedly: the state must prepare to open up avenues for civil society to participate in policymaking, and it must prepare the economy for a transformational period of upgrading. At the same time, the civil society must prepare itself to take responsibility for newfound competencies it will share with the state. In Pakistan, words such as policy engagement and economic upgrading can no longer be relegated to ivory towers; they must be opened up for the people. These efforts will set Pakistan on a prosperous path, as had been longed by its people for so many years.

Abir Hasan Niloy and Zaheer Abbas

The writers are researchers from Bangladesh. Md Abir Hasan Niloy is the co-founder of Youth Policy Forum and a DPhil student at Department of
International Development of the University of Oxford.

Zaheer Abbas is the Head of Reform Management in Youth Policy Forum, and a sophomore at the
Dual BA Program between SciencesPo Paris and Columbia University

The post Youth Participation In Policymaking: What Pakistan Can Learn From Bangladesh appeared first on Dissent Today.

The Achilles heel of Pakistan’s economy is the failure to institute stable and sustained economic growth. There is a mad rush to growth for a few years, followed by collapse with high fiscal or current account deficit or both. The IMF is called in. Some patchwork is done and a sigh of relief is enjoyed. The relief is temporary as the anti-growth structure of the economy remains untouched. This game of musical chairs has now been played 23 times in the half century elapsed since the second partition of the country in 1971. All players are equally to blame – politicians for their short-sightedness, military for its long term delusions, judiciary for myopic interference in economic affairs, bureaucracy for its lack of professionalism, businesses for poor competitiveness, landlords for failing to make their own lands productive, media for ignoring economic realities, intelligentsia and ulema for obfuscating discourses and even the ordinary people for not protesting enough against the rot.

Part of the explanation is that, over the years, understanding of the economy has been made a complex game. This article is an attempt to show that there are simpler and more accessible ways of looking at the economy and appreciate what ails it fundamentally. Ask a housewife in Lahore or Karachi, the question posed by the German chancellor, Angela Merkel, in 2008: “The root of the crisis is quite simple. One should simply have asked a Swabian housewife, here in Stuttgart, in Baden-Württemberg. She would have provided us with a short, simple and entirely correct piece of life-wisdom: that we cannot live beyond our means.” Instead, we have followed Keynes without paying attention to the context. Keynes had observed in one of his Essays in Persuasion (1931) that “We have plenty of cloth and only lack the courage to cut it into coats.” Clothes in Pakistan, as we all know, are not plentiful. A senior federal minister has publicly stated that the country has defaulted. Yet the programme with the IMF is not focusing on the expenditure side of the budget. Relatedly, the attention has been diverted away from the expenditure side of the national accounts as well.

When the country embarked on its development plans in the 1950s, there used to be a major debate on the saving and investment gap. Over the years, questions of saving and investment rates have been relegated into the background. Their place has been taken by fiscal deficit and the current account deficit. The twin deficits do suggest that saving is low. But how many of us know what is the domestic saving rate and where is the growth, whenever it happens, coming from?

The real GDP growth at basic prices was negative in FY20 due the devastating impact of the pandemic. It revived to 5.74 percent FY21, mainly because of the base effect. But its continued upward path with a growth of 5.97 per cent in FY22 created an illusion of revival, which was shattered soon by the international as well as local forecasts of growth of less than the population growth in the current year. Initially, the State Bank expected it in the range of 3-4 per cent but subsequently reviewed it further down. Consistent with Pakistan’s known history of political cycles of booms and busts, some economists fear a negative growth. Regardless, the official forecast of the government was 5 per cent.

Source: Planning Commission

Table 1 tells a story not told often. First, and foremost, growth in Pakistan is almost entirely driven by consumption. As its point contribution exceeds the GDP at market prices, it means that our consumption contributes to growth in countries we import from. Growth, to be sustained, has to be driven by investment.

In the past six years, the average contribution of total investment was 0.2 percentage point. It was less than the 0.3 percentage point contribution of public consumption. The highest GDP growth in this period, 5.97 per cent in FY22, had the highest contribution of consumption at 8.3 percentage points. The rate of total investment increased from 14.6 percent of GDP to 15.1 percent of GDP. With the private investment unchanged at 10 percent, the increase was completely attributable to public investment. Despite the slight increase, the rate of investment remains among the lowest in the world with a ranking of 133 among 151 countries. Bangladesh has a rate of investment of 30.5 per cent. In Pakistan, the rate of investment declined from 18.7 per cent in the 1990s to 17.7 in the 2000s and 15.5 per cent in the 2010s. It remains stagnant at the average for 15.6 per cent in FY16-22. Stagnant investment and declining labour productivity cannot produce growth sufficient to absorb the annual addition to the working population, what to speak of the existing pool of the unemployed.

Even the low level of investment is dependent on external financing. It will be seen in Table 2 that in FY22, national savings financed only 11.1 per cent of the investment, with a gap of 4.1 percent of GDP filled by the net inflow of external resources, or the so-called foreign saving.

The national savings rate is low, and the domestic saving rate should also worry us. Domestic savings, it may be noted, are achieved by deducting workers’ remittances and net investment income from abroad from national savings. These include household savings, business savings and public savings. Financial liberalisation and financial inclusion measures have not had the expected impact on household saving. Much of the financially included household saving is crowded in by the government for consumption, as public saving is ruled out in an environment of persistently high fiscal deficits.

Domestic financing plays a crucial role in the revenue collection efforts of developing countries. As Table 2 shows, domestic savings declined from 9.8 per cent in FY16 to 6.4 per cent in FY19. In FY20, it increased to 7.6 per cent but started to decline again reaching as low as 4.5 per cent in FY22. The average for the period is 7.4 percent. The second highest GDP growth rate of 5.97 per cent was achieved with the lowest domestic saving rate of 4.5 per cent. Domestic saving have been declining since the 1990s when it was 14.2 percent of GDP. In the 2000s, it declined further to 11.8 per cent. Now it is in single digit.

Pakistan’s low domestic saving rate is the inevitable outcome of the economic system’s failure to carry out real (not cosmetic) structural reforms over the decades.

We have an investment rate that fails to move to a respectable level, leaving growth to consumption financed by foreigners and the local elite. Debt accumulation is the inevitable result and the economy is seriously exposed to external shocks. Low domestic saving reduces financial independence and the chances of sustained economic growth.

As noted above, low domestic saving rate is the inevitable outcome of the failure to carry out real, not cosmetic, structural reforms over the decades. Periods of high growth generated by foreign saving did not bring forth domestic savers and investors. Indeed, foreign savings substituted for domestic savings. High growth leading to higher incomes that do not translate into higher domestic savings and investment is a recipe for decline in the times to come.

Immediately, there is no alternative to completing the IMF programme in a strict compliance mode. In the medium term, the approach that investment will generate its own savings has to be abandoned. The country should learn to save and invest accordingly. A domestic saving rate of 20 percent of GDP and national saving rate of 22 percent invested in productive assets is doable.

Dr Pervez Tahir

The writer is a political economist with a PhD from Cambridge. He served as the Chief Economist at the Planning Commission of the Government of Pakistan. He is presently a columnist at Express Tribune.

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