Fake growth during Musharraf!

There was no real growth during Musharraf. His economic policies did not result in any significant revival of Pakistan's economy. Here are some excerpts from Pakistani authors-

1. The economic Survey of 2007 showed the growth about 7% during 2000-2007. However many economists doubt the authencity of figures. We should also rememeber that it was a military government and was easy to hide the real figures or scrutinise by independent agencies.

2.Herald magazine (December 2008 issue) reports that Karamat Ali, executive director of the Pakistan Institute of Labour Education and Research, ‘believes that the official growth figures were often met with skepticism.’ With regards to the poverty level figures, Karamat Ali states, ‘In 2007, the Planning Commission’schief economist was transferred when he refused to approve government’s claim that poverty level had been reduced by 10 percent from 33 to 23 percent. These figures were clear manipulation as according to the latest UN assessments, poverty has intensified to the extent that in over half the country,hunger stalks one-fifth of the population and malnutrition about two-fifths. In Dawn(July 2009) this month, Kaiser Bengali, reported, ‘The years 2000-2007 … composition of growth brought little solace to half the population and, in fact, misery for the bottom quarter.’

3.Development and growth in an economy results in falling unemployment level. However, in Pakistan, this was not the case.Unemployment levels actually rose in some sectors. In the industrial sector, for example, unfavorable economic policies led to the closure of mills and subsequently high unemployment. Furthermore, reported Kaiser Bengali, “in the period when the agriculture sector grew by 1.5 percent and the banking sector grew by 30 percent ….. this was jobless growth. It was profit-centered and not wage-centered. It ensured that stock market indexes and corporate profits boomed but was meaningless for the people, who are now faced with the stark reality of unemployment and declining real wages.

4.It was profit-centered and not wage-centered. It ensured that stock market indexes and corporate profits boomed but was meaningless for the people, who are now faced with the stark reality of unemployment and declining real wages. Of course, official labor force statistics have reported a decline in unemployment. That, however, is a product of blatant data manipulation that the previous regime had come to specialize in.”

With an expanding economy and money flowing in, following sensible economic policies result in building up reserves and decreasing a country’s debt level. In Pakistan,debt levels rose dramatically between 1999 and 2008. If you sift through history, debt levels between 1947 and 1999 was Rs 2,946 billion. Conversely, if you look at the trend in the past ten years, the government borrowed so heavily that our debt level increased by Rs 2,749 billion to Rs 5,695 billion. Ultimately, it took the previous government eight years to bring up the debt to what was accumulated in over 50 years. Ishaq Dar (the first Finance Minister under the current regime) said in Nation that “those who claim to have broken the begging bowl have actually enlarged it…” High level of debt is not conducive for sustainable development as debt is a burden and has to be paid off. It suggests that Pakistan was living way beyond its means and needs to either expand its economy (which it was unable to do) or contract in future to bridge the gap (which is currently happening).

5.General Musharraf's regime has broken all records in borrowing and has pushed the country into a debt trap. Recent State Bank reports showed the government had borrowed a staggering amount of over 15 billion dollars in the past four years, as the country's total debt and liabilities had peaked to an all time high of 40.322 billion dollars. Such debt, apart from additional borrowing, is also composed of rescheduled debt as the Musharraf government continued borrowing to fund the basic government duties due to its inability to generate sufficient wealth from the domestic economy. Such amounts of debt have never existed in the history of Pakistan. By the end of 2004, the total external debt was 33 billion dollars. If the government had stopped borrowing as it claimed, the country's total debt would have declined to 23 billion dollars, based upon Pakistan's regular yearly payments by the end of June 2007.

More of it in the next article. But it should be clear, that there was never a real growth, as aclaimed by mnay. It was ll rich-consumer driven, whic did not increase any employment or built any industries in Pakistan. Taht is why, as soon a democratic and free government came, evryhting collapsed like a House of cards.