Pakistan is truly the poster child for scholars pushing the idea of countries experiencing growth without development. That is, a country who’s GDP continues to rise but whose developmental indicators - such as education, fertility rates, and life expectancy - remain stagnated. Economists who were attempting to repair Pakistan’s economy after its independence in 1947 worked using the same intuitive principle that drove the Marshall plan: more income yields a better society (Cohen, 95). However, the results after fifty years of growth would suggest a new principle is needed in Pakistan. Despite doing remarkably well with the growth of the economy compared to countries in similar economic situations, Pakistan has consistently ranked lower than some of the poorest countries in the world in terms of development indicators. In large part, this can be attributed to the country's political elite and tradition of ethnic factionalism. However, equally important to consider, and often overlooked, is the role that foreign agenda's have played in making Pakistan a slave to foreign aid and, subsequently, an inattentive social reformist.
Pakistan’s list of achievements in the past fifty years is truly a rags-to-riches, Heratio Alger story. Between 1950 and 1999 Pakistan was able to hold an average GDP growth rate of 2.2% which effectively tripled its GDP (Rodrik, 439). Moreover, its current PPP is in the greatest one-third of the world (Joeks, 37). Indeed, Pakistan has come a long way from the struggling newly formed nation it once was. However, it’s important to keep in mind that it also received the third largest amount of foreign assistance in the world and massive amount of World Bank and IMF loans. Obviously these loans are not misfortunes and if anything it only sets the bar that much higher for Pakistan in terms of social development because it received help when many more deserving countries were overlooked. Unfortunately, after all the aid Pakistan received and the economic progress it made, very little can be said of its social progress.
The laundry list of social crises in Pakistan surly eclipses the country's economic successes. Pakistan continually scores below the standard benchmark for a country with its income in development indicators such as infant mortality rates, literacy rates, and GDP spent on health care (Casterline, 96). Moreover, Freedom House ranked them the least democratic country in their income bracket and that was during a time when they had a democratically elected government (Rodrik, 446). Before and since then, Pakistan has slipped in and out of martial law in the name of fighting their rival neighbor, India (In fact, they are currently under martial law due to the inexplicable reason that were they to initiate elections there would be a possible terrorist attack). Perhaps even more appalling is that regardless of its transparency at any given time, forced child labor has been a problem without an end in sight (Toor, 195). Indeed, at the rate it’s going, Pakistan will be the first fully industrialized nation to employ child labor. It’s no wonder then that the average teacher is only present 19% of the school year (Gazdar, 51). The list truly goes on; despite spearheading the use of contraceptives in third world countries Pakistan boasts a horrible fertility rate and a growing concern of overpopulation. Pakistan has surly been successful in its defense spending, however. It spends billions on unused highways and nuclear weaponry each year and its defense budget outspends anyone in its income bracket by 3.3% GDP. There are numerous developmental disasters in Pakistan - and to be sure, those listed here only skim the surface - but how and why does such irresponsible spending occur in a country so economically proficient?
There are a few answers to this question, one of which is simply that the political elites in Pakistan either don't see a benefit to investing in their people or don’t want to because they fear they will lose power. Indeed, economists largely agree that when land and labor are abundant and labor capital is scarce there is a relatively low incentive to invest in the betterment of the labor force because it will yield little benefit. Thus the political and economic elite see little incentive for investing in education, health care, etc. for the Pakistani people. Only when the country becomes more developed and capital becomes abundant will landowners want to invest in the people (Galor and Moav). The paradox, of course, is that without the initial investment there won’t be any development. Hence, Pakistan would seem to be stuck in an underdeveloped slump. Another reason the political elite refuses to invest in the people is that a healthy and educated population will ultimately demand more rights (Bourgignon and Verdier, 285). When people become informed and realize they are being treated unfairly they will naturally voice their opposition to such treatment. Thus, those in power see it in their best interests to monopolize education and other resources. Consequently, social spending suffers leading to little, if any, education and healthcare for the poor. The elite greedily spend on their own endeavors and neglect the will of the largely uneducated populace.
A second approach to the explanation for Pakistan’s backwards development suggests that Pakistan suffers from the common post-colonial problem of ethnic factionalism. The British often indiscriminately drew borders for their colonies without regards for local ethnic divisions; Pakistan seems to be no exception. There are hundreds of ethnic groups within its borders and over twenty languages spoken in the heterogeneous country. Indeed, Pakistan is divided by three major fault lines. There are divisions between ethno linguistic groups, natives and immigrants and finally, amongst the different Muslim sects (Sharif, 131). Even if we assume that those in power are working for the benefit of their people, determining what the “public good” is for so many different factions becomes tedious if not impossible altogether. Different groups obviously value spending on different endeavors. Many Muslim groups living in rural areas of Pakistan, for example, want increased spending on agriculture and irrigation while Indian immigrants flocking to the cities would like to see more investment in factory facilities to attract foreign investors (Malik, 28). A limited budget will ultimately allow for investment in one or the other. Who decides and which one is chosen as the public’s best interest is obviously very controversial. The result of such stalemates is a lack of public services. With so many interests at stake, arguments over the distrbution of federal money effectively freeze the legislative process. Even when they do come together to create some sort of begrudged legislation, there is often little support for it in its implementation (Rodrik, 465). For example, a bill passed in 1990 calling for electricity in rural areas was finally implemented in 2004, over a decade later! This explanation for Pakistan’s backwardness is also very convincing in that it explains why so much money in Pakistan is spent on defense. Regardless of their differing points of view, every faction in Pakistan can agree that national security is a top priority. Unfortunately, setting aside differences for the well being of their people does not rank as high.
However, this last point is as much an effect of ethnic factionalism as it is an effect of the poking and prodding of Pakistan’s financial backers. The US especially, although not alone in its endeavors, has made demands of Pakistan that force it to divert funds to its military or risk facing a loss of economic aid. With 92% of its debt paid by foreign aid, this hardly appears to be a choice (Rodrik, 440). The US’ focus on Pakistan, at least in recent years, is a result of two factors. 1) Pakistan’s shared border with Afghanistan has made it a safe haven for Al Qaeda operatives seeking to destabilize the US’ already unstable, pet project. 2) The instability of Pakistan itself makes it a prime target for the theft of its nuclear technology by terrorist organizations residing in the country. Unsurprisingly, US and European demands have followed suit with these concerns. Pakistan has been “asked” to secure its nuclear stock piles and to crack down on militants based in its rural regions. Obviously, demands like these steal both money and attention away from public service projects. The foreign aid given to Pakistan is a gift with a stipulation involved. The vice here seems to be that Pakistan can’t survive without foreign aid, however, Pakistan can’t progress while being dependent on it either.
Moreover, the US has made it abundantly clear that the priority given to the well-being of Pakistan’s people will always rank lower than its own interests. A quick trip down memory lane will reveal that the US cut financial aid to Pakistan in 1990 because of its refusal to end its nuclear bomb program. With the introduction of the War on Terror in Afghanistan, Pakistan “miraculously” received $707 million in aid from the US in 03’. America’s 2008 budget will cut aid given to India and increase Pakistan’s aid to $770 million. When the administrator of the United States Agency for International Development, Randall Tobias, was asked why this was he responded, “Pakistan and Afghanistan are important to national security. India isn’t.” With virtually no alternative to fulfilling the demands of its financial backers, it’s no wonder that Pakistanis receive the amount of assistance that they do and yet see little social benefit from it. At any rate, it’s certainly hypocritical of any aid giver to expect development to occur under circumstances like these.
This is not to say that some solutions have never been attempted, however, all have ultimately failed. There were initially three different five-year plans. The first one in 1959 called for universal free primary education. However, this was obviously never pursued. The second and third five-year plans emphasized universal health coverage especially in rural areas and in the fight against malaria. These too failed due to lack of enforcement. Doctors never showed up to hospitals in rural areas and medicine was in too short a supply to ever be effective (Noman, 82). More recently, the Social Action Program was implemented to try to improve a number of social issues in Pakistan. It was a heavily foreign funded program with the goal to improve everything from school enrollment, infant mortality rates and the use of contraceptives to voting, government transparency, and lobbying for social spending. World Bank analyst, William Easterly, indicated that the data suggested the program was a failure (Rodrik, 455). The enrollment in primary education and the amount of money spent on public services actually went down. Even the areas that did improve, still did not meet the expected benchmark of a country in Pakistan’s income bracket. It’s hard to counterfactually evaluate the program but it would seem that it was $8 billion that could have been better spent.
The common theme amongst all the attempted solutions was that they failed to address the root causes of the problems mentioned earlier. None of these solutions attempted to tailor solutions specific to the problems of a corrupt elite and splintered nationalism and to be sure, no foreign aid giver has resolved to make less military demands on Pakistan. Granted, such a solution is hard to engineer. There are few examples of success in situations similar to Pakistan’s. One need only observe the never ending conflicts in countries equally divided such as Nigeria, Sudan, or Rwanda. However, there are three broad goals that might bring focus to the solution planning for Pakistan. First, public spending should be a localized process. Federal funding would be fairly divided amongst local governments to do with as they please. Issues of corruption and of consensus are much easier to solve at the local level where homogeneity exists. Second, foreign countries contributing aid should stop expecting short term growth. Part of Pakistan’s problem is that they are continually given aid with the expectation that it will yield short term growth. While short term growth clearly isn’t a problem for Pakistan it does cause them to forgo public spending in return for more loans. Finally, the international community, especially the US, should renew efforts to broker peace deals between India and Pakistan as well as resist making demands on Pakistan’s military in order to limit defense spending. The US’ recent nuclear trade agreement with India is obviously not comforting for Pakistan and merely promotes another arms race at the expense of social spending. However, since the US does have more leverage over what India does with its nuclear weapons now, it should utilize that influence to prevent further conflict between the two nations. With the assurance of security in place, Pakistan will be able to scale back its defense spending and begin to cooperate on social policy planning.
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Rodrik, Dani. “In Search of Prosperity”, Princeton University Press. 2003, pg. 439-470.
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