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Pace of economic development

Pace of economic development

According to newspaper reports, a World Bank official has predicted that the economy of Pakistan will further improve this year as conditions here are conducive for investment. Visiting the Tarbela hydropower extension project, Kristalina I. Georgieva, a senior bank official, said that the country has made progress in energy and infrastructure sectors and conditions are conducive for foreign investment. As a matter of fact, this government has sincerely worked for the improvement of economic conditions in the country, but political instability is increasingly becoming an area of concern for common man. Since the government took over the office, it has been facing tough time from certain opposition parties for one reason or the other. However, during its three and half years’ tenure, the government also could not made any visible improvement in the lives of the people. Corruption, though has been lowered on the World Perception Index, is actually touching the new heights in the country. The security situation has improved to some extent but it is still far from a satisfactory level and the government has still been reluctant to adopt modern techniques to enhance tax net and overhaul the industrial sector.

Pakistan is facing water threats from India which is the lifeline of Pakistan. Most of the hydropower projects are in the implementation stage and others are likely to be constructed in near future. On another hand, the new Indian government is bent upon cancelling the Indus Water Treaty signed in 1960. The World Bank is signatory and guarantor of the pact and it will have to play its role in stopping India from water aggression. Pakistan has so far obtained of $31 billion from the bank since 1952 when it took the first loan. It is also important to note that the country’s economy survived its initial five years after the independence without taking any foreign loan. However, once it took the loan, it became habit of every successive government to seek foreign loans without improving the country’s economy. The process of taking loans has been speeded for the last one decade and it seems the ploy will lead the country to nowhere. It is, therefore, hoped that the government will generate its own financial resources by boosting trade, business and investment. Pakistan still has to go a long way to introduce structural reforms in growth and energy sectors, but sooner this process should start the better.

Though the government is focusing on economic revival and seeks investments in energy, infrastructure and social sectors, but in practical terms, it is fully depending on the China Pakistan Economic Corridor. Unless the government reforms the economy, it will not be able to achieve the desired rate of growth.