Wednesday / Jun 24 2015
Newspaper : The News
The prerequisites for Pakistan to migrate from the present low-value agricultural economy to a knowledge-based economy are: (1) a visionary leadership that can understand and implement government policies for transitioning to a knowledge based economy; (2) the need to unleash the talents of about 100 million young people of Pakistan with high-quality school, college and university education; (3) establishment of world class universities and centres of excellence and establishing strong links of these institutions with the process of industrial and agricultural development; (4) a governance system that fosters merit and ruthlessly roots out corruption; and (5) a judicial system that provides quick and effective justice, meting out exemplary punishments to the corrupt and relieving the sufferings of the oppressed.
The South Korean success story is a good one for us to learn from and emulate. It started with the focus of the Korean government in the 1970s on high technology industries including ship-building, industrial machinery, engineering goods, electronics, non-ferrous metals, petrochemicals and chemicals. To provide the highly skilled technical manpower needed, a large number of world class universities and research institutes were established including the Korean Institute of Science & Technology, Korean Advanced Institute of Science & Technology, and Seoul National University. This allowed technology-driven industrialisation to take place through the availability of high quality scientists and engineers.
Twelve specialised research institutes were established in order to develop industrial technologies in partnership with private firms so that new products and processes could be developed and import substitution of sophisticated imported technologies could occur. A Special Law for Venture Business promotion was approved in 1997 to help in the emergence of new technology-based SMEs. Korea could thus move quickly from reverse engineering and imitation to innovation & entrepreneurship, as Japan had done previously. These wide-ranging macroeconomic, trade and industrial policy reforms focused on development of high-technology manufacturing and value added exports made Korea an industrial giant in just 25 years under the visionary leadership of General Park.
Pakistan cannot progress without rooting out corruption ruthlessly. According to Transparency International, a sum of Rs8500 billion was lost to corruption by the PPP ministers and officials in the first four years of the Gilani government (http://www.thenews.com.pk/Todays-News-13-12258-Rs). This needs to be plugged by closing down the FBR and establishing another independent organisation with new appointments of key personnel under judicial supervision to ensure that corrupt political appointees do not penetrate this important organisation.
The revamping of the judicial system must accompany such reforms. At present the judicial system is in a complete shambles. There are about 1.8 million cases pending in the Supreme Court, the high courts, and district courts of Pakistan. The lack of interest in reforming the justice system is evident from the fact that there were 55 posts of judges lying vacant in the higher courts since December 2013. About 3000 new judges need to be appointed on six-monthly contracts and mandated to decide at least two cases per day so that the backlog can be cleared within 18 months and quick justice delivered. Their contracts should be renewed only if they perform well.
One example of the huge damage done by the lack of swift justice is the case pending before the Sindh High Court against the formation of the Sindh Higher Education Commission that was established in clear defiance and contempt of the Supreme Court decision. The Supreme Court had ruled in 2011 on my petition that higher education was a federal subject and could not be devolved to the provinces under the 18th Amendment. The case was filed in the Sindh High Court in February 2013 but there has been little progress in spite of repeated applications for urgent hearing. The result is that most universities in Sindh are suffering because of the interference of the Sindh government in university affairs and the formation of laws that conflict with the jurisdiction of the Higher Education Commission Islamabad. The chief justice of the Sindh High Court needs to resolve the matter quickly before more harm is done.
Higher education has a direct bearing on the uniformity of standards, international recognition of degrees, national development plans and national integration. That is why India, Sri Lanka, Korea, China, Turkey, and the United Kingdom among others have kept higher education as a federal subject. The 18th Amendment has already done huge damage to Pakistan, particularly in the health and education sectors. It has weakened the federation and enhanced corruption, particularly in Sindh and Balochistan where the transfer of additional funds to the provinces has only served to line the pockets of the corrupt.
An improved credit rating by Standard and Poor does not reflect economic prosperity, something our financeminister would have us believe. It only shows our ability to pay back loans. This is only due to debts taken from the IMF and stashed in our bank accounts. Economic prosperity is possible only from industrial and agricultural growth and for this the size of the PSDP needs to be multiplied several fold. For this the reserves should be decreased from $17 billion to $7 billion and the $10 billion should be invested in education, for building dams to provide electricity to industries and additional water for agriculture, as well as to strengthen the engineering sector.
The reality is that we spend only about 1.9 percent of our GDP on education and the promises of the previous government to enhance this to 7 percent (a cabinet policy decision) or of the present government to increase it to 4 percent of GDP (a manifesto commitment of PNL-N) remain little more than pipedreams. During the last 12 months literacy levels in Pakistan have actually fallen from 60 percent to 58 percent, and poverty has increased.
The government of Pakistan needs to realise that that the real challenge today in this knowledge-driven world is to embark on building a strong knowledge economy with focus on high technology industrial manufacturing. Our exports stagnate at $25 billion, while a small country such as Singapore with no natural resources and with a population one-fourth of Karachi has exports of $458 billion annually. Building roads and bridges do not make a nation. High quality schools, colleges and universities are needed to develop the needed skilled workers that can then contribute to high technology manufacturing and exports.
The roadmap for the socio-economic development of Pakistan exists and was prepared after a two-year effort under my supervision by the leading experts of Pakistan in various sectors and was approved by the cabinet on August 30, 2007. Let us implement it.