Three major issues affecting Pakistan and it economy
- Illiteracy – only 50% of the total population of people above “15 in Pakistan know how to read and write” (Arby 35). This results in a great percentage of people living below the poverty line and who are struggling for basic necessities. The technology adoption is also very slow and hence there is a low growth rate.
- Poverty- 40% of the total population use less than a dollar per day for their daily needs. They, therefore, do not focus on such issues as investments or development.
- Corruption and political instability – the government of Pakistan is not stable due to ignorance and international interferences, which lead to low growth. Corruption especially from the government officials also affects the growth.
Major policies
Education
Education policy should be formulated and implemented to help in improving education system in the country. Free education would alienate illiteracy and hence growth.
Exports and imports
Policy on imports and exports should also be adopted. Since the exports of this country are highly concentrated, they should be dispersed
Fiscal balancing
The economic managers should focus on raising more revenues in tax and reducing the expenditure to be able to meet the gap. Managers did not establish the public finance pattern, but they relied on foreign grants. This led to fiscal imbalances and hence no growth realized.
Pakistan: Key Statistics
Economic Survey of Pakistan 2007-2008, & Global HDR Report 2007.
Major problems affecting the economy of Pakistan
The Republic of Pakistan is the country that has a lot of resources, but it is currently facing various problems in its economy. There are three major problems that have contributed to instabilities in the economy of this country. They have to a great extent contributed to slow growth and development in this country. They include:
Poverty
The recent statistical data analysis shows that the number of people living below the poverty line has increased from 3/10 to 4/10 of the total population. The analysis was done by Pakistan’s government.
This is a major problem affecting the country. 40% of the total population of Pakistan uses less than a dollar every day, it is clear that such people will only focus on the easiest way of surviving. They, therefore, struggle to get clothing, food, shelter, education and health care. Since they do not care about the development, its growth rate is very low (Vigar and Rashid 453).
Illiteracy
Illiteracy is another factor that is greatly affecting the Republic of Pakistan. As has been mentioned, in Pakistan, half of the whole population is illiterate. This has contributed to a great extent to poverty, inflation, and child labor. The current statistics indicates that the number of illiterate people will increase in the future.
Those who hold big positions only know how to read and write; they are no conversant with the new technology. Bearing in mind that we are living in a computer era, those in Pakistan may fail to realize the changes in the new technology, and, therefore, fail to develop. Spain, for example, has been adopting the new technology at a very slow rate.
Technology has come up with new ways of production which are cheap and save time. Human labor in developing and developed countries has to a great extent been replaced by computers and machinery. If Pakistan does not take initiatives to embrace new technology through quality education to the citizens, it might experience fiscal imbalances in the nearest future.
Corruption and political instability
There is some problem in Pakistan that is fatal to some extent. This problem is known as establishment. The structure of the government of Pakistan is, therefore, under the control of this establishment. It regulates the main positions in the government. It ensures that the touts remain in the high position and, consequently, control the country. The establishment gains support from international interference and manipulation.
Those corrupt people, as a result, get an opportunity to govern again after a warm welcome by the citizens. This affects to a large extent the political process of Pakistan which in turn becomes a barrier to development of the country at large (Husain, 423).
Three major policies for Pakistan
The performance of Pakistan was recommendable in 1980s but this changed since the beginning of 1990s when it recorded the lowest gross development product growth. Economic policies thus need to be adopted to help in solving such crises that considerably lower the GDP growth of the country. To begin with, new education policy should be formulated to help in improving education system in the country.
It is believed that illiteracy has contributed to almost 70% of in gross development product growth in other international countries (International Monetary Fund, International Financial Statistics). Literate people will be able to quickly adopt the new technology and contribute to development of the country at large. Policy on imports and exports should also be adopted.
Since the exports of this country are highly concentrated, they should be dispersed. The majority of the exports come from apparels and textile. Expansion of such sectors will help the country earn more foreign exchange and hence growth will be realized. Fiscal balancing is another policy that is very essential. Economic managers did not establish the public finance pattern, but they relied on foreign grants.
This results in budget deficit due to fiscal imbalances as a result of borrowing from private sectors for short term, and non-bank organizations. In addition, domestic savings should be increased (Arby, 768).
The economic managers should focus on raising more revenues in tax and reducing the expenditure to be able to meet the gap. The above policies will help improve the GNI growth of Pakistan and as such some development will be realized (Husain, 765).
Works Cited
Arby, Michael, “Major Issues and Remedies with Regard to Public Debt in Pakistan”, Journal of the Institute of Bankers in Pakistan 70(4): 31–47. Print.
Husain, Ishrat. “Current Issues in Pakistan’s Economy”, State Bank of Pakistan, Islamabad: State Bank of Pakistan, 2005. Print.
Husain, Ishrat. Pakistan, the Economy of an Elitist State, Karachi: Oxford University Press, 1999. Print.
International Monetary Fund, International Financial Statistics, Washington, DC. 1991. Print.
Viqar Ahmad, and A. Rashid, The Management of Pakistan’s Economy: 1947-82, Karachi: Oxford University Press, 1984. Print.