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Visions of Mahbub

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Mahbub ul Haq taught me all I know about economics that is ultimately worth knowing. In a nation cruelly short of heroes, Mahbub, my first boss, was a shining light. As Chief Economist of the Planning Commission in the 1960s, he punctured the celebrated high growth rates of the Ayub era. He showed an enraptured domestic audience that state resources had been misused to create powerful monopolies that stifled entrepreneurship and only survived because of subsidies. As a result, the benefits of this growth had been hijacked by a handful of families, who controlled the majority of the country’s land and industrial wealth.

Later, as an adviser to World Bank President Robert McNamara, Mahbub launched a frontal assault on the false god of economic growth and its cathedral on earth, the free play of market forces. He pointed out that across the world, too, growth often fails to translate into better lives for ordinary people. Moreover, he argued that the mythical forces of demand and supply do not work when people are shackled by low purchasing power or a handful has monopoly power. To address this, he saw a vital role for the state in kick-starting the process of growth and ensuring it was equitably shared. Through these insights, he pioneered the paradigm of human development, and with it the vastly influential human development index which looks beyond GDP to capture other vital dimensions of human well-being like decent education, good health, political freedom, cultural identity, personal security, community participation, and environmental security.

Mahbub was a man ahead of his time. His eloquence reverberated on the world stage. He emerged as the spokesperson of the developing world, incessantly appealing to the conscience of richer nations. He is missed every day. Today, a quarter century after his untimely passing, his beloved homeland remains mired in desperate poverty and massive inequality. While most of our neighbours have taken off, we remain stuck at a per capita income of a little over $1,000 and every third person lives on less than $3 a day. Almost half our people are illiterate and less than a quarter of our women work.

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Much like in Mahbub’s time, the fault still lies in the engines of our growth and the fickleness of our public policies. Our politicians are obsessed with growth at any cost but pull the wrong levers to achieve it time and time again: lazy, a short-term stimulus that inevitably leads to painful busts as opposed to the long and winding road of structural reforms that unleashes prolonged growth through higher productivity and innovation. Short-termism associated with political cycles and an unfortunate lack of preparation and imagination among the economic teams of political parties is to blame.

Pakistan today is a country that can barely grow above 4-5% without finding itself hobbled by a current account deficit it cannot finance. Its growth model is too reliant on consumption, which accounts for a staggering 95% of overall output, while investment and exports make up just 15 and 10%, respectively. As a result, the country runs a perennial current account deficit, in stark contrast to the surpluses generated by the high-saving Asian tigers of the 1970s and 1980s.

This leaves us at the mercy of foreign savings. Unfortunately, unlike other emerging markets, we hardly attract any meaningful investment from abroad into our companies or capital markets, and our own companies and banks do not borrow externally. Therefore, unless the world doles out generous amounts of aid as it did during the Musharraf era, the only way to finance our current account deficit is for the government to borrow from abroad and thus build up external public debt.

If this debt were being used to finance investment in Pakistan that increased the productive capacity of the economy or exports that generated foreign exchange, it would be healthy, and we would be able to pay it back. Unfortunately, in our case, it is used to finance egregious levels of consumption so that we need to continually borrow to pay back our old debts. This game cannot be played indefinitely, and we have reached its limits. This is what pushes us to the IMF time and time again.

So today, we are a million miles from Mahbub’s visions. Thanks to unfettered population growth, Pakistan has become the fifth-largest country in the world. By this metric alone, it should be a major force on the globe. And yet, we have become curiously inward-looking and self-absorbed. Our companies do not make anything that other countries want. They are very comfortable operating within our borders, protected by generous government subsidies and barriers to competition. Our media only carries domestic stories and most of the sensational kind. It is then no surprise that we have a major identity crisis in terms of our place in the world and the friends we wish to cultivate. Domestically, our social contract is in tatters. Our people do not trust their government enough to pay taxes in exchange for vital public services like health, education, roads, and security.

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So how can we break free? Half a century of global experience has taught us that there are a few necessary conditions for sustained growth. These include fiscal and monetary discipline that guarantees macroeconomic stability, right sizing the government so it is neither too large nor too small, relying on investment and manufacturing as major growth engines, rallying behind reformist governments, encouraging entrepreneurship and innovation, and making the most of your geographical location.

Getting these basics right is important but there are no boiler-plate solutions for achieving them that can simply be imported. Local realities must be kept in mind. In our quest for lasting growth and poverty reduction, there is no substitute for perseverance, experimentation, and learning from mistakes. China’s development story illustrates these virtues. Moreover, all of China’s leaders and key economic managers are made to spend vast amounts of time being groomed at the grassroots level in different provinces before being allowed to ascend the corridors of power.

Without a similar mindset, we can never progress. I will turn to some of these ideas in subsequent writings. For now, let me conclude with one of Mahbub’s favourite couplets from Faiz. It captures well the zeitgeist that must define our country’s journey from here:

Nahin nigaah mein manzil tau justajoo hi sahi

Nahin visaal mayassar tau aarzoo hi sahi

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Even if our destination is not in sight

Let us at least begin the quest

Even if our union is not to be

Let us at least continue our yearning

Published in The Express Tribune, August 2nd, 2022.

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Opinion

Words and truth are poison together

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Religions, wars, deception, hatred and so forth have touched human existence ever since human beings went through what is called the Cognitive Revolution i.e. when humans gained the ability to imagine things and to lie about them and more importantly when they gained the ability to communicate. Some call it the gift of language. Alternatively, it could arguably be called the curse of language too.

Neil deGrasse Tyson says that if someday there ever would be an encounter between humans and some alien civilisation, from a distant planet, that is intelligent, the communication would only happen in math and science. Words would be useless in such a situation. Besides, words have brought troubles throughout human history in the form of wars, cultural misrepresentations, religious dogmas, racial and national hatreds and so forth. There is one crucial difference between words and numbers — only the latter doesn’t lie.

However, that truism is actually rather seriously not understood. Because here is the sucker: words are capable of speaking and showing the truth very well, but we don’t like words that are true. We can deal with 2 plus 2 equals 4 but we can’t deal with words calling us a thief even if we have spent a lifetime stealing things. No thief wants to be called a thief. You have heard that before. What you have never heard is 5 doesn’t like to be called 4. The mindset is that words are for storytelling and entertainment, let numbers take care of the truth.

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The truth is that we actually like to get a good strong whiff of lies everyday otherwise we might feel empty. At the breakfast table, the disturbing news of someone’s brutal death on TV is quickly moved away from by changing the channel where we might come across some commercial ad using glamorous words and gestures to tell nothing but lies, which we find entertaining. Our Facebook posts are nothing but lies because true expressions will cause problems.

If you have seen the movie Liar Liar with Jim Carrey, you’d know that he attracts hatred and anger from people when he is incapable of telling lies just for one day. When words and truth combine, all kinds of unfortunate and explosive things happen. When a certain private channel tried to combine the two back in 2007, General Musharraf banned the channel. When Edward Snowden tried it, he not only had to run for his life but he continues to live in exile. Speaking of which, not too many changed how they communicate or make purchases but almost everyone wants to jump on the latest tracking device that Snowden warned about i-e the smartphone.

This week, words and truth were combined by Pakistani politician Shehbaz Gill. It didn’t end well for him. Recently, some journalists also tried to create an amalgamation of truth and words and they miserably failed too. Even the very popular leader Imran Khan is no longer in power because he dared playing the alchemist too and the result was a bad explosion.

Pakistan is but a weird nation. Words may not be able to move us but numbers aren’t a success story either. Forget India, forget PML-N or those who play the shenanigans in the shadows; the real and the most serious threat that Pakistan faces, and which is also a national security threat, is the threat of climate change. And numbers have been speaking to us about this threat. The noise about how serious the threat of climate change is comes to us in scientific and mathematical languages. However, it seems that the truth is the ultimate poison in Pakistan. Whatever it combines with, words or numbers, the result is a sorry state.

Published in The Express Tribune, August 11th, 2022.

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Opinion

The meaning of Karbala

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History is replete with occasions when some individuals proved to be larger than life and spiritually immortal by preserving moral principles against all trials and tribulations. Evil exists in various forms and manifestations that grows on lust and spreads like epidemics through ignorance only to be subdued temporarily by the ‘right’ force. Imam Husain (RA) offered the supreme sacrifice to carry on the tradition of total submission to Allah (SWT) on the one hand and to resist tyranny of the time on the other with a message for posterity to emulate his example.

The slogan of ‘Islam rejuvenates after every Karbala’ reverberates everywhere at the beginning of Muharram (the first month of Islamic calendar) and culminates on its 10th day when every pious Muslim is expected to make a firm determination to fight on tyranny and evil until truth ultimately prevails. Utopia aside, this triumph of good over evil would salvage humanity from man-made sufferings and enable it to focus on progress-for-all rather than wasting energies on lose-lose relations. Unfortunately, the prevailing global order is skewed in favour of evil which calls for radical transformation.

What Imam Husain (RA) wanted to see was a state run by men of high moral standards and unblemished character which could inspire the Muslims in general to embody Islamic values in every sphere of life. He could not see Islam to be confined to performing certain rituals on particular occasions with no role whatsoever in politics. He was convinced that evil on top would have trickle-down effects on the masses. Unlike us, he considered his oath of allegiance as a sacred trust to be discharged under conditions set forth by the holy Quran and Sunnah. This sublime attitude needs revival in electing rulers under democracy which is closer to the concept of Shura and consensus in Islam.

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The Muslim world in general continues to grapple with a persistent vicious cycle of degeneration due primarily to losing sight of its moral roots and spiritual destiny. Its abysmal and marginal role in world affairs reflects its drift from the right path. The Muslim Ummah should have been a monolithic body characterised by unity of thought, shared purpose and joint action as ordained by Allah (SWT) to symbolise monotheism — the foundation of Islam and fountainhead of Muslim character. Despite so many efforts, this avowed and most cherished goal of becoming an Ummah seems to be a fantasy thanks to identity crisis as a result of sectarian differences, diverse cultures, and most importantly economic disparities.

At the heart of sacrifice at Karbala lies a spirit of liberation and perseverance. Imam Husain (RA) declined to accept a ruler who was using coercive means to attain and sustain power like our rulers do today. He could neither be deterred from his mission by a formidable army nor by any incentives carried by the oath of allegiance to an unqualified ruler. He opted to be martyred and his family massacred just to protect and promote the Islamic ideals of equality, justice and peace. Our failure to understand the true meaning of Karbala would make us passive recipients of tyranny.

The 10th of Muharram should not just be a day devoted to performing a few ceremonial activities with no practical steps ever taken to fight pervasive corruption, persecution of oppressed communities and other social, economic and political injustices. This day should remind the Muslim rulers that Yazid, despite suppressing every dissenting voice and eliminating all opposition, went down the history as the most cursed ruler. For ordinary Muslims, this day symbolises a constant struggle for truth, justice and equality against all odds through non-violent legitimate means.

Published in The Express Tribune, August 11th, 2022.

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Opinion

Dialogue with TTP: lopsided rationale

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Pakistan flew in tribal elders, Ulema, officials and stakeholders to ‘convince’ the outlawed Tehreek-e-Taliban Pakistan (TTP) to reconcile for peace in Kabul this summer, under the supervision of Islamic Emirate of Afghanistan (IEA), specifically the ‘Haqqani’ Group. The talks, commenced in October 2021, stand stalled as TTP apparently is unwilling to budge from its core demand of reversal of erstwhile FATA’s merger with Khyber-Pakhtunkhwa province. Requiring a constitutional amendment, such reversal is not happening. There are also reported objections by Pakistani interlocutors over TTP’s insistence to remain armed back home, consequent to a peace deal.

During the latest push to take the peace talks forward, a second Pakistani tribal delegation arrived in Kabul on 30 July 2022, following an Ulema delegation earlier, led by Mufti Taqi Usmani. Ulema also pressed TTP to lay down arms and return to Pakistan. The agreed ceasefire holds on paper at least, and Pakistan did release some TTP prisoners.

On June 22 this year, the Parliamentary Committee on National Security (PCNS) was briefed by Military leadership during a closed-door session in the PM House. The over-arching rationale for talks with the terrorists’ outfit touted by the government was/is “the fear of TTP fighters joining ISIS/Da’esh”. This is as flimsy a rationale as it can get.

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TTP touches a raw nerve. The memories of the APS Peshawar attack, killing innocent kids only because they studied in an Army school, are still fresh. The beheadings of countless soldiers and security personal all along, the kidnappings for ransom, the nihilist bombing of mosques even, still disturbingly flash back. The terrorist outfit does not respect Pakistan’s Constitution/laws, and strives for a state within a state. TTP’s continued reign of terror against security forces continues, whenever the lure of fake peace, lowers our guard.

So, as mentioned in earlier writings, it is not a sincere desire for peace that drives the TTP calculus. Pakistan’s stern warnings to the IEA of shutting down TTP safe havens inside Afghan territory; airstrikes on TTP’s hideouts on 16 April 2021; and IEA’s ‘impatient keenness’ to get rid of this legacy issue to regain sovereign control of the entire Afghanistan are the real drivers behind IEA/TTP peace overtures. Pakistan in December 2021 unsuccessfully targeted a senior Taliban leader, Faqir Mohammad, through a reported drone strike in Afghanistan’s eastern Kunar province. TTP’s re-entry this week into Peochar Valley, Swat was perhaps a ‘recce in force’ aimed at gleaning the security ‘pulse’.

TTP also realises that the Afghan swamp will eventually dry up for them, as continued usage of Afghan safe-havens upsets an ‘indispensable’ Pakistan, something that the IEA cannot afford. And like all insurgencies, TTP’s ‘exhaustion point’ (culminating point in military parlance) neared due to fatigue, casualties, falling recruitment and unfavourable politico-military environment may be reached sooner than later.

IEA crackdown on TTP is a divisive issue within Afghans for various reasons like IEA still finding its footing, presence of ISIS, and embarrassment the IEA faces over the US drone killing al-Zawahiri, etc. Moreover, reportedly the Qandahari component of IEA does not look eye to eye to Haqqanis’ protégé — the TTP. TTP and Haqqanis remained aligned during Jihad against the US/NATO.

So, Kabul/Islamabad’s fears that an estranged TTP/its splinter groups could swell ISIS ranks are misplaced for varied reasons. One; irrespective of the outcome of peace talks, die-hard TTP cadre has and will elope with Da’esh. Life without violence is meaningless for such nihilist elements. Two; in that eventuality, having pacified the ‘reconcilable elements’ within TTP, it would be operationally helpful for IEA to concentrate on ISIS alone, rather than looking over its shoulders towards an unpredictable TTP cadre. Three; ISIS threat is overblown and manageable for a combined IEA-Pakistan (indirect) Military enterprise. Four; ISIS plus or minus the TTP hardliners will have to be dealt with by both countries irrespective, now or in near future. And lastly, defeating and eliminating TTP from the Afghan soil will enhance IEA standing, regionally and internationally, paving the way for its ultimate recognition and economic salvation.

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Pakistani Military/veterans and important national stakeholders are also not supportive in entirety of blank amnesty to TTP. Hard-nosed negotiations evoking riwaj (traditions), tribal laws and sharia, as necessary, need to drive the process. The ‘state’ concedes but only after the ‘citizens’ accept state sovereignty, lay down their arms, apologise and guarantee good conduct in future. In doing so, as mentioned previously, the ‘black elements’ with heinous crimes are dealt with/eliminated, using the stipulated process. If history is any guide, it was not too far in the past, when the British Army, using native troops, would exact revenge and reparations in the same mountains, whenever the Empire’s rights were infringed upon. Holding nerve is name of the game.

Due to differences among political parties for the anticipated outcomes, parliamentary oversight committee constituted will ensure sidelining of any unconstitutional or illegal TTP demands. Military should drive and spearhead the process, but its ultimate ownership must squarely rest with the Government of Pakistan.

As a way forward in ‘fighting and talking mode’ that the TTP seem to prefer, Pakistan in collaboration with/acquiescence of IEA, should continue to target TTP cis/trans-frontier. According to Pakistan Institute for Conflict and Security Studies (PICSS), in 153 militant attacks, causing 293 deaths during first six months of 2022, most were attributed to TTP. A TTP armed with sophisticated weaponry left behind by withdrawing US/defeated ANA troops needs to be confronted forcefully, as any other outcome will embolden segments within the IEA to realise their grand designs, if any, for the region.

Afghan Taliban’s ascent to power and continued support enhances Pakistan a ‘positive leverage’ with IEA. Hopefully there would be little need for Pakistan’s ‘coercive leverage’ like the April airstrikes. Domestically, shunning complacency, TTP’s Swat-like incursions must be eliminated with full force. In a pragmatic policy calibration, Pakistan should take IEA on board for neutralising TTP. One hopes the August 7 killing of TTP leaders including Omar Khalid Khorasani inside Afghanistan’s Paktika province had some harmonisation.

Politically, Mullah Hibatullah Akhundzada, the IEA spiritual leader, be persuaded to decree against TTP renegades who target a Muslim Pakistan, misuse Afghan soil/hospitality and violate IEA commitment to the World.

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Coup from within should to be our ‘Main Effort’ now.

Published in The Express Tribune, August 11th, 2022.

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