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Time comes to focus on new economic model
By: Haider Abbas

ISLAMABAD: Pakistan as a
frontline state against the war on terror is encountering many
restrictions and losses, but its support is not reciprocated by the US
government in the same spirit and with the same sincerity as
demonstrated by Islamabad.

With this point in mind, the government should formulate a new
economic model to achieve the desired growth and revive the eroded
credibility, with likely cooperation from the US.

According to estimates of the Economic Survey 2013-14,
Pakistan’s economy suffered enormous direct and indirect costs of the
war on terror, which continued to rise from $2.69 billion in 2001-02 to
$102.5 billion by 2014-15. However, the country has only been
remunerated one-fourth of the losses its economy has borne since
becoming the US ally in the war against terrorism in 2002.

Despite these huge losses, the US has not invested in building a
civilian government in Pakistan. Its funding to enhance civilian
capabilities through investment in the police and rule of law,
parliament and human development has been relatively small.

A lopsided focus on security aid after the 9/11 attacks has not
delivered counter-terrorism dividends, but led to military control over
state institutions and policy-making mechanisms.

However, at the same time Pakistan is also the victim of American
double standards as Washington, on the one hand, demands more action
against the militants but, on the other hand, it has decided to reduce
civilian aid from $703 million in 2013 to $446 million in 2015, which
will add to Pakistan’s economic woes.

Moreover, the socio-economic impact of the prolonged war has been the
most alarming, which should be considered by the international
community. A large part of the resources, both men and material, is
being consumed by the war for the last several years.

Hundreds of suicide bombings across the country have inflicted huge
damages to physical infrastructure and expenses made on controlling law
and order have squeezed the economy more than ever.

It is estimated that over 40,000 people have lost their lives in
Pakistan, including 5,000 security personnel, in the war on terror. The
distressing and puzzling aspect of all these sacrifices is that there
seems to be no end in sight of the menace of terrorism and terrorist
attacks even in the foreseeable future.

Global image

In addition to this, the image of Pakistan has been shattered on the
international scene, causing an increase in trade deficit year after
year. Many western governments have issued travel advisories to their
citizens, cautioning them against travel to Pakistan.

Many reputable international buying houses that established their
offices in Pakistan before 9/11 for the purchase of value-added textiles
from not only Pakistan but the entire region have shifted to Singapore,
Hong Kong and India.

On the other side, Pakistani businessmen are subjected to a strict
scrutiny for the grant of visa. The visas to the lucky few are issued
after a considerable delay. One-to-one contact between Pakistani
businesses and their foreign counterparts has been restricted or
completely denied.

This has adversely impacted exports from the country as foreign
buyers are exploiting the situation in a bid to buy goods at cheaper

This shows that the US has badly used Pakistan for its own national
interests and it seems that Pakistan is only a loser in this game.

At this juncture, the US needs to align its programmes with Pakistani
priorities and work with Pakistani state institutions. This will help
to build the capacity of the civilian government, improve governance and
strengthen institutions.

The challenges are myriad and the economy is not growing fast enough
to accommodate the population growth. Providing a new avenue for
economic growth is good for Pakistan and the region.

Therefore, US assistance programmes need to be framed in a way that
meets these needs and contributes to the social and political
development of Pakistan.

The writer is a researcher at the Sustainable Development Policy Institute Islamabad

Source :

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The opinions expressed in this article are the author's own and do not necessarily reflect the viewpoint or stance of SDPI.