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    November 16, 2016

Detail

 

Constraints to Pakistan's Economy

Dear Editor,

Today Pakistan economy faces myriad problems. Economic development is a complete process. It covers economic, social, cultural, administrative, and political factor. There are mutual threats that the world faces in the form of epidemics, climate change, poverty, civil wars, class-conflicts, inter and intra state conflicts and economic crises.

Pakistan is an agricultural based economy since its independence. There is a vast disparity in the country Economic growth and development which is not very encouraging. Using 2013-14 data, the poverty headcount ratio comes out to be 29.5pc of the population. Due to unequal distribution of wealth our economic growth is shattered due to which we are not able to break the vicious circle of poverty and enter into takeoff stage. The economic obstacles which have affected the rate of growth in Pakistan are external debt which is serious threat to economic future of the country. The second is fiscal deficit which reduces the capacity of the government to spend on key activities, our banking and financing sectors in crises, the poor performance of financial sector had adversely affected development, persistent deficit in BOP and financing the budgetary gap and deficiency of capital.

Currently Pakistan is facing political instability which closes off sources of internal and external investments, internal disorder such adversely affect economic development. One of the core obstacle is corruption, itís difficult for businessman and industrialist to take part, stay and grow in business thus limits economic upliftment. The citizens are not being provided right education which is necessary component of any successful development strategy on the other hand we are still struggling very hard to the issues. Expert says population is rising because death rates have fallen in developing countries, as a result of vaccination and other medical advances, but birth rate shows no signs of falling. While experiencing this situation we have inefficient human capital which is measured by skills, education, and health is far below the standard in developed countries in the world. We are also stuck in dual economic system, inadequate infrastructure facilities as well as inappropriate social structure. In brief the main constraints which are most important in economic development of a country are market imperfection, vicious circle of poverty, inadequate infrastructure, political instability in country.

Where thereís a will thereís a way. Pakistan can counter these issues as it have blanket of natural resources but require practical means of setting aside the barriers to economic development i.e. : Expanding the tax base, self-reliance policy, export led growth, industrialization, development in agriculture sector, improvement in infrastructure, stable fiscal and monetary policy, promote technological advancement, administrative reforms, development of physical and human capital.
In some key sectors government needs to focus and put possible efforts which will bring economic growth and development, most importantly these policies will not only bring economic progress in the country but itís positive impact will also trickled down the masses.



Sincerely,
Mehboob hussain Khan
Undergraduate University of Karachi
Department of Economics.


 

 

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