This article is part of a series titled “Is there a way forward for Pakistan?” Read more about the series here.
Crises are not new for Pakistan. It has faced dozens of economic, political and humanitarian crises since 1947—around one every 2-3 years. Since 2000 alone, it has faced three mega humanitarian crises (2005 earthquake; 2010 and 2022 floods) and a dozen smaller ones; massive internal displacement due to the war on terror; on-going insurgency in Balochistan; endless political crises and 5-6 major economic crises. It is perhaps the most crisis-prone state globally since 2000.
Even by these standards, the current poly-crises encompassing an economic current account crisis; a political crisis since the April 2022 vote of no-confidence and the 2022 floods against the backdrop of the global slowdown due to the Ukraine war easily ranks as one of its worst crises.
If the current situation is bad, future trends show that Pakistan may face even bigger crises in the next 25 years leading to its 100 years as a free state than it has so far in 75 years.
Demographically, our population may hit 325 million by 2050 against 220 million now. Demographics spell doom against the backdrop of misrule if the state fails to invest socially in health and education. Already, we have the second most illiterate kids globally. Ecologically, by 2050, climate change will destroy fertile soil, swamp coastlines, cause water wars and up disasters and migration hugely. As one of its biggest victims globally, we may face more mega emergencies, epidemics, migration and conflict as more people chase fewer goods.
Economically, we suffer from long-run slow GDP and job growth, high twin deficits, huge debt and low innovation and competitiveness. This has led to 23 IMF programs since 1958, high unemployment and economic stagnation. There are little signs these economic trends will change soon. Socially, fake religiosity, false patriotism and extremism are increasing rapidly. The Tehreek-e-Labbaik Pakistan reflects this trend. It is a monster still in evolution well below its full potential that could cause huge harm, more than the Taliban, as it expands its faith agenda, street power and electoral clout in key Punjab and Karachi areas. A state can’t be both an economic and extremism hub. Externally, our growing Barelvi extremism lies close to Hindu and Buddhist ones in the east and Salafist and Shia ones in west. All hate yet feed each other, making this area the most unstable extremism mosaic globally.
Indo-Pak enmity is the main global nuclear risk in future. Instability in Afghanistan poses increased terrorism threats,as does the Baloch insurgency. Politically, we suffer from elite patronage politics that causes misrule and constant interference by the army in politics which undermines political institutions and increases political autocracy. Politics is society’s avenue to adopt apt policies against other threats. But for us, it poses threats itself.
These six trends portend six security and economic paths to doom for Pakistan, some more immediate than others. The gravest security pathway is nuclear war. The Indo-Pak tiff is the big nuclear risk globally. No two nuclear states have fought yet but there is always a first time for new mania. Another grim security pathway is internal extremist war that ruined Somalia and Syria with big areas falling to them.
Taliban too seized ex-Fata and Swat in 2007 and were sixty miles from leafy Islamabad sending panic waves among its elites. Army action during 2008-16 cut the risk but Taliban’s Kabul win has upped it. Another risk is ethnic insurgency and succession, as with Sudan, Yugoslavia and us too in ’71. Our ethnic Achilles heel is Balochistan. Baloch rebels lack capacity to secede soon or even hold much area but have made some no-go areas and can now stage big attacks beyond home.
Economically, one path to doom is the Soviet one which fell after decades of de-growth due to big misrule and army outlays. We have both too. We don’t yet see prolonged de-growth but may in the long-run, as its two causes persist. Another economic path to doom is hyperinflation. Loose monetary and fiscal policy creating wage-price vicious circles cause it. Our usually cheery central bank glumly told us recently those circles are emerging. A last economic pathway is currency collapse as in East Asia in 1998 due to external deficits as the private sector took short-term foreign loans for long-term work that gave no dollar earning. A scare in one state made foreign lenders pull loans regionally to cause currency collapses. We have had external deficits for decades but now take bigger foreign loans for works with no dollar earnings, though mainly less panicky state to state ones. But souring ties with big lenders may mean default.
How far are we from each tipping point and can we change course before the points of no return? Among the six, nuclear war may occur any time, but its risk is low. But the risk of the last two inter-linked economic pathways is high. We may only be a couple of years from the tipping point as new economic risks like wage-price spirals and foreign loans for local works increase. Economic doom doesn’t cause the gory violence of security dooms. Yet it causes silent, covert violence that hurts the poor badly via local disease, crime, and abuse. We are the only large state globally, and perhaps even only one facing all recent security and economic pathways to doom seen globally except warlord politics that doomed Liberia etc.
Why is Pakistan alone so vulnerable to doom compared to other large states in South Asia, such as India, Bangladesh, and Sri Lanka? Politics is the driving force behind all security, economic, social, and external threats. So, what is so different about our politics from other similar regional countries with whom we share geography, history, culture, ecology and economy? Why is that the country from which Pakistan split (India) and the country that split from Pakistan (Bangladesh) are economically and politically much more stable and dynamic than it? A comparison of our politics shows that these three regional states too have similar dynastic political parties and are close to us on the Transparency International Corruption Perception Index, with Bangladesh being much worse than us. Yet those political parties deliver much better than ours on governance. Deeper analysis shows that the contrasting point is on civilian supremacy and democratic continuity. While India and Sri Lanka never had military rule and have had regular elections and peaceful transfer of powers from the beginning, Bangladesh has joined their ranks too in the last 15 years and has in fact started progressing since then.
In contrast, Pakistan had its first and only peaceful transfer of power between two fairly elected political parties only in 2013 and has since then regressed again since the 2018 elections were very controversial, as mentioned even in the European Union’s election monitoring report for 2018. The security establishment has rigged partially or fully thirteen out of our fifteen national-level elections or referenda and has been instrumental in creating or controlling political parties, with the founders of all three major parties (PTI, PML-N and PPP) having been brought into politics by generals. So, clearly the fountainhead of a way forward for Pakistan towards political stability, economic dynamism and social progress has to be civilian supremacy and an end to the political role of the security establishment. Yet, so badly has its political interference over the past 60 years damaged Pakistan’s politics that its after-effects will continue to haunt it for decades even if it were to become apolitical immediately, of which there are yet no signs.
But assuming civilian supremacy, the next questions are about the right governance structure for Pakistan. The multiple hybrid systems short of outright martial law tried by the security establishment during the 1960s, 1980s and 2003-2008 have all failed too. China and Vietnam’s success has evoked much interest in the virtues of one-party rule among some analysts despite its big failures elsewhere. None of our parties have the huge capacities or the national stature to manage a one-party system successfully in Pakistan. Some analysts see electoral system fixes as panaceas: Presidentialism, proportional representation and term and family limits. But there is no global evidence show that any of them work better than our current first past the post parliamentary system or that a simple switch from one system to another can resolve the major underlying political problems that Pakistan faces. In fact, the more successful regional states like India and Bangladesh have achieved their success with a system very similar to ours. However, India’s Congress model, where after Rajiv Gandhi’s death, the Gandhi family restricted itself to running the Congress party while appointing competent non-family Prime Ministers to manage state governance is one that Pakistani family and personality-driven major parties like PML-N, PPP and PTI must emulate as India’s march towards being a global power started under such eras after 1991.
So badly has the security establishment’s political interference over the past 60 years damaged Pakistan’s politics that its after-effects will continue to haunt the country for decades even if it were to become apolitical immediately, of which there are yet no signs.
So rather than getting into futile exercises to change electoral system with unclear benefits, the focus must be on pressurizing the current parliamentary system to deliver the right mix of social, political and economic policies to halt the malaise and make a move towards progress to at least narrow the gap between it and the more successful regional states. The first issue here is the role of the state. We neither need the elitist state like our own, nor the neo-liberal, hands-off Latin American state nor the Myanmar or North Korea’s totalitarian state nor the Iranian theocratic state. We need a state that combines the developmental role played by Asian Tigers states (good macroeconomic management and stability, a competent bureaucracy, symbiotic state-business relations, publicly controlled financing for development, and a dynamic industrial policy to facilitate industrial and exports growth) and the welfare role played by the Scandinavian state. Their broad contours are so well known. Economically, it requires increased taxes and exports to cut our big fiscal and external deficits that often give crises; population management, reforming power and water sectors and increasing social and economic investment and productivity to get sustainable and equitable growth. Politically, it means devolution; police, judicial and bureaucracy reforms; peace with Baloch rebels and ending TTP terrorism. Externally, it means peace with India and good ties with all key allies like the West, Gulf states and China. Socially, it means ending extremism and full rights for women, minorities, and other weak groups.
We must devise an innovative “Poor-led progress (PLP)” model. PLP sees investing in the poor not just as an ethical or anti-conflict concern but actually as the main driver of national progress. Our internal market is small, despite a large population, given the low incomes of the majority. Increasing their incomes expands national market size and profits for producers. This in turn again expands jobs and incomes for the poor and national market size, thus igniting a virtuous cycle of national progress. The poor spend more on local goods than the rich, thus benefiting local producers and external account. So investing in the poor, largely seen as a moral aim, can actually be the main national growth engine under trickle-up economics that puts those at the bottom at the top.
A seven-step approach (COMPASS-credit, organizations, market power, protection, assets, skills and social services) that goes beyond giving only cash hand-outs serves as the compass for PLP. One, we must expand the poor’s ownership of assets. This includes land reforms, key to East Asian progress. Two, we must expand easy credit for the poor. Three, we must expand the access of the poor to appropriate skills and technology. Four, the government must ensure the rule of law to protect them from economic and physical abuse, e.g., evictions, false cases and labor abuse. Five, the state must expand locally devolved quality education, health, family planning, disaster and other social services for the poor. Six, there is a need to support community-based groups which mobilize, link and advocate for the poor. Seven, increasing the bargaining power of the poor in markets is key. Minorities, women, and people in far-flung areas must be prioritized. All this may require the state to invest Rs. trillion-plus yearly on the poor above current funding which it can do easily by increasing agriculture, property, retail, transport and wealth taxes; and cutting state enterprise losses, elite subsidies, defense outlays and tax evasion.
Experts offer very blueprints for each one of these ideas. But the issue is getting the state to adopt them as these steps nix the interests of powerful elites that stymie their adoption. These include politicians linked to sugar, real estate mafias etc., military elites who thwart peace with Baloch groups and India and thwart cuts to their big budget and businesses; bureaucrats, Mullahs etc. Can major change emerge fast enough from this paralyzed labyrinth of elite politics to avert doom? There are two paths forward. The first is a dose of doom jolting our elites finally into action. We have seen this already. The only time in recent decades our state took big action to end a major threat very successfully was in 2015 when thousands of deaths, big terrorism in major cities and loss of large areas finally jolted our elites to end terrorism. But even it has upped recently as elite interests cut full action and fatally led to futile peace talks with TTP again. A mix of hyperinflation, Rupee collapse and default is a serious risk in next couple of years. Would it jolt elites to act? The key worries on this path are the high human costs and unclarity on whether we would be able to end the crisis and if even it would invoke deep reforms. Many states have overcome such crises to do deep reform, but all had strong capacities, like Israel and the Asian Tigers. Among weak ones, Zimbabwe still is badly misruled and prone to a relapse. We face much more complex and multi-axel problems than it, including ethnic and extremism issues, a badly divided polity, and hostile ties with neighbors. Thus, such an economic crisis may morph into a political and security Armageddon for us. Luckily, there is a second, more proactive, path too.
The history of successful states shows that social movements play a critical role in improving the quality of governance and making it more people centered. Thus, it is critical for Pakistani society to organize itself better and form an alliance or coalition for change to force elites to adopt egalitarian policies that help avoid doom. Progressive, grassroots, pro-poor groups are obvious partners for leading the coalition for this pro-poor agenda. But Pakistan’s situation is so precarious, especially economically even in the short-term, that most components of this agenda would appeal to a much broader alliance, which is also necessary given the enormity of the task involved in swaying strong elite interests. Thus, a broader coalition that includes pro-poor advocacy groups, farmer, and labor entities as leaders but also professional bodies of lawyers, doctors, teachers, engineers and others; media groups, business groups, academia and expatriate groups is needed.
This practically means society willing to support such an agenda outside the narrow range of elite interests that currently control state policy or extremist and criminal groups. The starting step could be for progressive grass-roots groups to come together and then gradually expand the coalition by inviting other societal groups into it. But even this doesn’t guarantee success given the low odds of firstly getting such an alliance together and secondly its low odds of succeeding. But the chances of any other path succeeding are even lower. This sadly reflects our poor odds going forward.
The writer is an Islamabad-based Political Economist with a Ph.D. From the University of
California, Berkeley. He can be reached at murtazaniaz@yahoo.com. X:@NiazMurtaza2.
