This book attempts to explain the development experience of a post-colonial state in the backdrop of ever-shifting ideas about growth.
Pakistan was a typical underdeveloped state when it started its journey as an independent nation-state on the 14th of August 1947, as a result of the dissolution of the British Indian Empire. It was facing almost the same myriad challenges every post-colonial state was grappling in those days. Boldly accepting these challenges, the new state started its journey literally from a scratch. Despite all these ups and downs, Pakistan is now the 26th largest economy in the world in terms of Purchasing Power Parity (PPP), (44th largest in terms of nominal GDP). With per capita income of US$ 4550, Pakistan occupies 140th place on this count in the world, thanks to her burgeoning population of more than 200 million people. Pakistan is one of the Next Eleven, the eleven countries that, along with the BRICs, have the potential to become one of the world's large economies in the 21st century.
According to Goldman Sachs, by 2050, with an estimated GDP of $3.33 trillion, Pakistan is expected to become the world's 18th largest economy. According to the list of "32 Most Powerful Economies In The World By 2050" published by The Independent in 2017, Pakistan ranks at number 17; ahead of South Korea, Italy, Canada, Spain, Australia, and Netherlands.
This book is all about these attempts and U-turns, failures and achievements and so on.
Divided into thirteen chapters, it starts with recounting the initial conditions at the time of her independence-acute shortages of physical, financial and economic resources at its disposal, the administrative handicaps, the abysmal state of infrastructure, etc. It then examines in a bit detail, the efforts made during the seven decades of her existence as an independent nation-state to transform its political economy from an underdeveloped stage to the one it is now.
During these seven decades, Pakistan initiated formal planning process in the 1950s and strengthened its industrial sector in the 1960s, toyed with the idea of a socialist transformation of the country in the 1970s for a short period and then adopted economic liberalisation and global integration as cornerstones of its economic management and growth policy.
Chapter twelve sums up the seven decades development experience of Pakistan highlighting what it did marvellously, what it did marginally and where it failed miserably during its development journey. It also recounts the main features of the political economy of Pakistan evolved over the past 70 years of its existence as an independent nation-state
As stated in the Preface to this edition, this book will be followed by another book namely “Accelerating Economic Growth of Pakistan: A Handbook” which will be stock-taking of the political economy of Pakistan by carrying out its SWOT Analysis and list the six main challenges it is facing. Rest of the book would then deal with recommending policies and strategies to respond to these challenges
There are four annexures at appropriate places in the book. In Annexure A I have tried to debunk the myths about the Two-Nation Theory used by the British Indian Muslims to justify the creation of Pakistan. Annexure B is an analysis of the factors responsible for the dismemberment of pre-1971 Pakistan and the lessons other developing countries can learn from this traumatic episode of Pakistan's history. Annexure C explains in detail why the rate of economic growth remained high during the period Pakistan was under military dictatorship as compared with the period it was being ruled by the elected civilian representatives. Annexure D compares the development process of South Korea with that of Pakistan and explains why it is not justified to blame Pakistan for not becoming an Asian Tiger like South Korea.
Because of these annexures, there is bound to be some repetition-my advance apologies!
Genre: BUSINESS & ECONOMICS / Development / Sustainable Developmentjust published
Theories of economic growth keep on changing over time in response to the changes in the objective realities and subjective perceptions of those propounding these theories.
Learning a lesson from the success of planned growth through the state in the Union of Soviet Socialist Republics (USSR), conventional wisdom advocated in the 1950s and 60s that the government could be the driving force for accelerating the rate of growth of a developing country for which rapid industrialization through capital accumulation was the only requirement.
At the same time, integration into the world was necessary for certain key products, yet it was neither necessary nor sufficient for growth; hence import substitution was considered a prerequisite for take-off. Foreign Direct Investment was to be avoided but government borrowing was acceptable preferably from formal sources etc.
In the 1970s all these ideas came under heavy scrutiny based on empirical evidence. Downplaying the role of the state as a guarantee of the economic success of a country, the government came to be viewed as a hindrance in this process as its failure was considered more devastating and pervasive than market failure. Similarly, capital accumulation lost its pre-eminence as a crucial determinant of economic growth and was listed as important but not the main determinant of economic progress. Instead, increasing human capital in the form of better education, skills and health took precedence.
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German
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Already translated.
Translated by John Wannecke
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Portuguese
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Translation in progress.
Translated by André Weber
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