Saturday, June 28, 2014

1800 Km Long Rail Link Planned to Connect China and Pakistan

China has funded a study to build an international rail link from the city of Kashgar in the Xinjiang Uygur autonomous region in Western China to Pakistan's deep-sea Gwadar Port on the Arabian Sea, according to Zhang Chunlin, director of Xinjiang's regional development and reform commission.

"The 1,800-kilometer China-Pakistan railway is planned to also pass through Pakistan's capital of Islamabad and Karachi," Zhang Chunlin said at the two-day International Seminar on the Silk Road Economic Belt in Urumqi, Xinjiang's capital, according to China Daily. "Although the cost of constructing the railway is expected to be high due to the hostile environment and complicated geographic conditions, the study of the project has already started," Zhang said. "China and Pakistan will co-fund the railway construction. Building oil and gas pipelines between Gwadar Port and China is also on the agenda," Zhang added.

Source: China Daily


The Pak-China link announcement was part of the discussion on China's broader effort to revive the historic Silk Route by building three main corridors through southern, central and northern Xinjiang to connect China with Russia, Europe and Pakistan. The Silk Road Economic Belt International seminar which concluded on Friday in Urumqi, Xinjinag was jointly sponsored by the State Council Information Office, China International Publishing Group (CIPG), China Academy of Social Sciences (CASS) and Xinjiang Academy of Social Sciences.

In a report last year, China's State-owned Xinhua News Agency articulated China's motivation to expand land trade in addition to building its navy to protect its sea trade. Here's what it said:

“As a global economic power, China has a tremendous number of economic sea lanes to protect. China is justified to develop its military capabilities to safeguard its sovereignty and protect its vast interests around the world."

The Xinhua report has for the first time shed light on China's growing concerns with US pivot to Asia which could threaten China's international trade and its economic lifeline of energy and other natural resources it needs to sustain and grow its economy. This concern has been further reinforced by the following:

1. Frequent US statements to "check" China's rise.  For example, former US Defense Secretary Leon Panetta said in a 2011 address to the Naval Postgraduate School in California: "We try everything we can to cooperate with these rising powers and to work with them, but to make sure at the same time that they do not threaten stability in the world, to be able to project our power, to be able to say to the world that we continue to be a force to be reckoned with." He added that "we continue to confront rising powers in the world - China, India, Brazil, Russia, countries that we need to cooperate with. We need to hopefully work with. But in the end, we also need to make sure do not threaten the stability of the world."

Source: The Guardian


2. Chinese strategists see a long chain of islands from Japan in the north, all the way down to Australia, all United States allies, all potential controlling chokepoints that could  block Chinese sea lanes and cripple its economy, business and industry.



Karakoram Highway-World's Highest Paved International Road at 15000 ft.


Chinese Premier's emphasis on "connectivity and maritime sectors" and "China-Pakistan economic corridor project" is mainly driven by their paranoia about the US intentions to "check China's rise" It is intended to establish greater maritime presence at Gwadar, located close to the strategic Strait of Hormuz, and  to build land routes (motorways, rail links, pipelines)  from the Persian Gulf through Pakistan to Western China. This is China's insurance to continue trade with West Asia and the Middle East in case of hostilities with the United States and its allies in Asia.

Pakistan's Gawadar Port- located 400 Km from the Strait of Hormuz

As to the benefits for Pakistanis, expanded trade and the Chinese investment in "connectivity and maritime sectors" and "China-Pakistan economic corridor project" will help build infrastructure, stimulate Pakistan's economy and create millions of badly needed jobs.

Clearly, China-Pakistan ties have now become much more strategic than the US-Pakistan ties, particularly since 2011 because, as American Journalist Mark Mazzetti of New York Times put it, the  Obama administration's heavy handed policies "turned Pakistan against the United States". A similar view is offered by a former State Department official Vali Nasr in his book "The Dispensable Nation".

Related Links:

Haq's Musings 

How Strategic Are Pak-China Ties?

US-Pakistan Ties and New Silk Route

Can Pakistan Say No to US Aid?

Obama's Pakistan Connections

Seeing Bin Laden's Death in Wider Perspective

China's Investment and Trade in South Asia

China Signs Power Plant Deals with Pakistan

Soaring Imports from China Worry India

China's Checkbook Diplomacy

Yuan to Replace Dollar in World Trade?

China Sees Opportunities Where Others See Risk

Chinese Do Good and Do Well in Developing World

Can Chimerica Rescue the World Economy?

Friday, June 27, 2014

India Loves Pakistan Meat Dishes

"When Delhi's Press Club organised an evening of Pakistani food and music, flying in chefs from Islamabad, the racks of richly-spiced meat on the grill quickly ran out as hundreds of Indian journalists brought their families, equipped with "tiffin" boxes to take away extra supplies"  BBC Report 26 June 2014


The BBC story highlights the fact that the vegetarian India demonstrates its deep love of the exquisite taste of Pakistan's meat dishes whenever the opportunity presents itself.  To further illustrate the phenomenon, let me share with my readers how two famous Indians see meat-loving Pakistan:

Sachin Tendulkar:

 The senior cricketer...said he gorged on Pakistani food and had piled on a few kilos on his debut tour there. "The first tour of Pakistan was a memorable one. I used to have a heavy breakfast which was keema paratha and then have a glass of lassi and then think of dinner. After practice sessions there was no lunch because it was heavy but also at the same time delicious. I wouldn't think of having lunch or snack in the afternoon. I was only 16 and I was growing," Tendulkar recalled. "It was a phenomenal experience, because when I got back to Mumbai and got on the weighing scale I couldn't believe myself. But whenever we have been to Pakistan, the food has been delicious. It is tasty and I have to be careful for putting on weight," he said.

Source: Press Trust of India November 2, 2012

 Hindol Sengupta:

Yes, that's right. The meat. There always, always seems to be meat in every meal, everywhere in Pakistan. Every where you go, everyone you know is eating meat. From India, with its profusion of vegetarian food, it seems like a glimpse of the other world. The bazaars of Lahore are full of meat of every type and form and shape and size and in Karachi, I have eaten some of the tastiest rolls ever. For a Bengali committed to his non-vegetarianism, this is paradise regained. Also, the quality of meat always seems better, fresher, fatter, more succulent, more seductive, and somehow more tantalizingly carnal in Pakistan. I have a curious relationship with meat in Pakistan. It always inevitably makes me ill but I cannot seem to stop eating it. From the halimto the payato the nihari, it is always irresistible and sends shock shivers to the body unaccustomed to such rich food. How the Pakistanis eat such food day after day is an eternal mystery but truly you have not eaten well until you have eaten in Lahore!

Source: The Hindu August 7, 2010

Silicon Valley Indians:

I personally see vivid proof of how much Indians love Pakistani food every time I go to Pakistan restaurants serving chicken tikka, seekh kabab, biryani and nihari in Silicon Valley, California. Among the Pakistani restaurants most frequented by Indians are Shalimar, Pakwan and Shan. These restaurants are also very popular with white Americans and East Asians in addition to other ethnic groups including Afghans, Middle Easterners and South Asians.

Carnivorous Pakistanis: 

A recent study published in Proceedings of the National Academy of Sciences and Nature magazine reported that Pakistanis are among the most carnivorous people in the world.

The scientists conducting the study  used "trophic levels" to place people in the food chain. The trophic system puts algae which makes its own food at level 1. Rabbits that eat plants are level 2 and foxes that eat herbivores are 3. Cod, which eats other fish, is level four, and top predators, such as polar bears and orcas, are up at 5.5 - the highest on the scale.
Trophic Levels Map Source: Nature Magazine
After studying the eating habits of 176 countries, the authors found that average human being is at 2.21 trophic level. It put Pakistanis at 2.4, the same trophic level as Europeans and Americans. China and India are at 2.1 and 2.2 respectively.

Source: Proceedings of National Academy of Sciences

The countries with the highest trophic levels (most carnivorous people) include Mongolia, Sweden and Finland, which have levels of 2.5, and the whole of Western Europe, USA, Australia, Argentina, Sudan, Mauritania, Kazakhstan, Pakistan and Turkmenistan, which all have a level of 2.4.

United States Department of Agriculture (USDA) also published recent report on the subject of meat consumption. It found that meat consumption in developing countries is increasing with rising incomes. USDA projects an average 2.4 percent annual increase in developing countries compared with 0.9 percent in developed countries. Per capita poultry meat consumption in developing countries is projected to rise 2.8 percent per year during 2013-22, much faster than that of pork (2.2 percent) and beef (1.9 percent).

Summary:

Although meat consumption in Pakistan is rising, it still remains very low by world standards. At just 18 Kg per person, it's less than half of the world average of 42 Kg per capita meat consumption reported by the FAO.

While Pakistanis are the most carnivorous people among South Asians, their love of meat is spreading to India with its rising middle class incomes.  Being mostly vegetarian, neighboring Indians consume only 3.2 Kg of meat per capita, less than one-fifth of Pakistan's 18 Kg. Daal (legumes or pulses) are popular in South Asia as a protein source.  Indians consume 11.68 Kg of daal per capita, about twice as much as Pakistan's 6.57 Kg.

India and China with the rising incomes of their billion-plus populations are expected to be the main drivers of the worldwide demand for meat and poultry in the future.

Related Links:

Sunday, June 22, 2014

Pakistan Accepted as Associate Member of CERN Ahead of India

"It would be embarrassing if Pakistan becomes an associate member of CERN before India", said eminent Indian scientist and Homi Bhabha Professor Bikash Sinha in early June, 2014. Well, it has happened this week. Pakistan is now an associate member of CERN, the world's largest and most prestigious center for science research.

Large Hadron Collider at CERN
Pakistan is the first Asian country and only the third in the world after Turkey and Serbia to be honored with CERN's associate membership. The status of associate member is a step before full membership. As an associate member, Pakistan  is entitled to attend open and restricted sessions of the organization.

The CERN was founded in 1953 by 12 European nations including Belgium, Denmark, France, the Federal Republic of Germany, Greece, Italy, the Netherlands, Norway, Sweden, Switzerland, the United Kingdom and Yugoslavia. The organization was subsequently joined by Austria (1959), Spain (1961-1969, re-joined 1983), Portugal (1985), Finland (1991), Poland (1991), Czechoslovak Republic (1992), Hungary (1992), Bulgaria (1999) and Israel (2014). The Czech Republic and Slovak Republic re-joined CERN after their mutual independence in 1993. CERN now has 21 member states and Romania is a candidate to become a member state. Serbia is an associate member in the pre-stage to membership. "Observer" status allows non-member states to attend council meetings and to receive council documents, without taking part in the decision-making procedures of the organization. Over 600 institutes and universities around the world use CERN's facilities.

Pakistan's National Center for Physics (NCP) has been collaborating with CERN since 2000.  Pakistan's associate membership application was unanimously approved at a meeting of the CERN council on September 17 this year. The final approval came this week after a report of a CERN “fact-finding mission” to Pakistan in February 2014 was accepted.

CERN is leading the most high-profile effort to find "God Particle" about 300 ft below ground in a tunnel at the French-Swiss border. Buried there is a massive particle accelerator and super collider called LHC (Large Hadron Collider) run by CERN (European Organization of Nuclear Research), which has two beams of particles racing at nearly the speed of light in opposite directions and the resulting particles produced from collisions are being detected by massive detectors in the hope of experimentally finding the fundamental particle of which everything in the universe is built from: God Particle.

Dr. Hafeez Hoorani and President Musharraf

Among the world scientists working at CERN on LHC project is Professor Hafeez Hoorani of Pakistan's Quaid-e-Azam University in Islamabad. He is one of 27 Pakistani scientists at CERN. Hoorani has acknowledged that Pakistan government's support for Pakistani scientists' serious involvement at CERN materialized only after 1999, the year former President Musharraf's government assumed power. He also gives credit to Dr. Abdus Salam, Pakistan's only Nobel Laureate, for inspiring him and his colleagues to pursue serious scientific research. Here's what Professor Hoorani says about Pakistan's involvement in LHC and CERN:

When I first came to CERN, I was mainly working on technical things but became increasingly involved in political issues. In 1999, I went back to Pakistan to set up a group working on different aspects of the LHC project. There I had to convince my people and my government to collaborate with CERN, which was rather difficult, since nobody associated science with Switzerland. It is known as a place for tourism, for its watches, and nice places to visit.

However, Pakistan already had an early connection to CERN through the late Abdus Salam, the sole Nobel laureate from Pakistan in science and one of the fathers of the electroweak theory. CERN has been known to the scientific community of Pakistan since 1973 through the discovery of neutral currents which eventually led to the Nobel Prize for Salam. We are contributing much more now because of the students who worked with Salam, who know his theories and CERN, and who are now placed at highly influential positions within the government of Pakistan. They have helped and pushed Pakistan towards a very meaningful scientific collaboration with CERN. People now know that there is an organization called CERN. It took a long time to explain what CERN is about, and I brought many people here to show them, because they did not imagine CERN this way. Many people support us now which gives us hope…”



In addition to the 27 scientists, Pakistan has made material contributions to the tune of $10m. Pakistan signed an agreement with CERN which doubled the Pakistani contribution from one to two million Swiss francs. And with this new agreement Pakistan started construction of the resistive plate chambers required for the CMS muon system. While more recently, a protocol has been signed enhancing Pakistan’s total contribution to the LHC program to $10 million.

Pakistan has contributed the LHC in numerous ways including some of the following in particular:

1. Detector construction
2. Detector simulation
3. Physics analysis
4. Grid computing
5. Computational software development
6. Manufacturing of mechanical equipment
7. Alignment of the CMS (Compact Muon Solenoid) tracker using lasers
8. Testing of electronic equipment
9. Barrel Yoke: 35 Ton each feet made in Pakistan
10. Assembly of CF (Carbon Fiber) Fins for the Silicon Tracker’s TOB (Tracker Outer Barrel).
11. 245 of the 300 CMS chambers required were made in Islamabad.

Pakistan has had an impressive 50 per cent increase in the number of research publications during just the last two years, going up from 3,939 to 6,200. This has been the second highest increase worldwide, according to SCimago, the world's leading research database. The latest QS world rankings include 10 Pakistani universities among Asia's top 300.



Rise of research and publications at Pakistani universities began during Musharraf years when the annual budget for higher education increased from only Rs 500 million in 2000 to Rs 28 billion in 2008, to lay the foundations of the development of a strong knowledge economy, according to former education minister Dr. Ata ur Rehman. Student enrollment in universities increased from 270,000 to 900,000 and the number of universities and degree awarding institutions increased from 57 in 2000 to 137 by 2008. Government R&D spending jumped seven-fold as percentage of GDP from 0.1% of GDP in 1999 to 0.7% of GDP in 2007.

Related Links:

Haq's Musings

Pakistani Scientists at CERN

10 Pakistani Universities Among Asia's Top 300

Genomics and Biotech Research in Pakistan

Human Capital Growth in Pakistan

Educational Attainment in Pakistan

Pakistan Human Development in Musharraf Years

Robotics Growth in Pakistan 

Saturday, June 21, 2014

10 Pakistani Universities Among Asia's Top 300

QS World University Rankings 2014 announcement lists 10 Pakistani universities among Asia's top 300.

South Asian institutions featuring on this list include 17 from India, 10 from Pakistan and 1 each from Bangladesh and Sri Lanka. The list is topped by Singapore with its National University at #1 and includes Singapore's Nanyang Technical University at #7. It is dominated by 58 universities from China (including 7 in Hong Kong and 1 in Macao), 50 from Japan, 47 from South Korea and 28 from Taiwan. Other nations represented with universities among top 300 in Asia are: Malaysia (17), Thailand (10), Indonesia (9), Philippines (5), Vietnam (3) and Brunei (1).



Pakistani universities on the list are: Pakistan Inst of Engineering and Applied Sciences (PIEAS) at  106,  Aga Khan University (AKU) at 116,  Quaid-e-Azam University (QAU)at 123 National University of Sciences and Trechnology (NUST) at  129, Lahore University of Management Sciences (LUMS) at 180-190,  COMSATS Institute of Technology at 201-250, Karachi University (KU) at 201-250, Punjab University (PU) at 201-250,  University of Agriculture Faisalabad  (UAF) at 251-300 and University of Engineering Technology (UET) Lahore at 251-300.



Rise in international rankings of Pakistani universities began during Musharraf years when the annual budget for higher education increased from only Rs 500 million in 2000 to Rs 28 billion in 2008, to lay the foundations of the development of a strong knowledge economy, according to former education minister Dr. Ata ur Rehman. Student enrollment in universities increased from 270,000 to 900,000 and the number of universities and degree awarding institutions increased from 57 in 2000 to 137 by 2008. Government R&D spending jumped seven-fold from 0.1% of GDP in 1999 to 0.7% of GDP in 2007.

Related Links:

Sunday, June 15, 2014

Pakistan-Made Soccer Ball Design For FIFA World Cup 2014

Pakistan is manufacturing and supplying footballs for use in all 64 matches of the World Cup 2014 in Brazil. In addition, most European football leagues have place huge orders to buy Brazuca balls designed by Adidas and made in Pakistan.

Brazuca Ball Source: BBC 
Brazuca football is made from six identical propeller shaped polyurethane pieces glued to a rubber bladder and thermally  bonded together. It weighs 437 grams and measures 69 cm in circumference. Pakistan produces the high-quality polyurethane used in manufacturing Brazuca football panels. Brazuca is quite different from the traditional soccer balls which have historically been made of leather pieces stitched together in Sialkot, Pakistan. Polyurethane balls are water-resistant and maintain their shape much better than the leather balls under a variety of conditions in terms of temperature, pressure and humidity. Leather balls have a problem specially  if they soak up the water when it rains during play. Pakistan was chosen to supply the ball after China, the supplier of Jabulani for 2010 World Cup, was unable to meet FIFA's requirements.

Pakistan has not only earned the honor of manufacturing the ball that will be used in FIFA 2014 matches but also outdone both India and China in supplying tens of millions of footballs to European nations that place bulk orders for promotional purposes, according to India's Economic Times.

The Brazuca design is an improvement on the Jabulani ball used in 2010 World Cup in South Africa. Jabulani was too smooth with shallow seams, a problem that has been fixed in the Brazuca by adding raise nub texture and creating deeper seams making its flight more predictable.

The 2010 Jabulani ball had eight panels. The 2006 ball had 14. Before that, the balls were made of 32 internally-stitched panels. By decreasing the number of panels, they decreased the seams, creating a smoother surface. This smoother surface allows it to travel at higher speeds before it started knuckling. Knuckling is when the ball wobbles in the air, following an unpredictable flight path. It's a tool for strikers, a menace for goalkeepers. Researchers at the Center for Sports Engineering Research at Sheffield Hallam University in the UK measured the seams of the Jabulani and the Brazuca, and found that the Jabulani's seams are about .48 mm deep compared to 1.56 mm for the Brazuca. The seams on the Brazuca stretch to 327 cm, compared to 203 cm on the Jabulani.

The Brazuca ball went through a range of scientific tests to assure that it would complement the players' skills on the field, rather than adding a skill set all its own. "We do extensive flight path analysis and the results have shown constant and predictable paths, with deviations hardly recognizable," Matthias Mecking told the BBC. Mecking is Adidas's football director. "We've come full circle," NASA Ames Research Center scientist Ravi Mehta told the CBS News. "It's back to knuckling at about 30mph."  He was not involved in the design but has tested the ball. Another important factor, he says, is the amount of friction between the ball and the player's boot. Dr Mehta explained that when a relatively smooth ball with seams flies through the air without much spin, the air close to the surface is affected by the seams, producing an asymmetric flow. This asymmetry creates forces that can suddenly knock the ball, causing volatile swoops.

Those who are familiar with the cricket ball know that seams and rough surfaces play a crucial role in how the bowler can make it swing in flight, a technique pioneered by Pakistan's Waqar Younis.  Knuckle ball technique used by some Baseball pitchers is similar. The use of seams and roughness of the ball are tools for the bowler or pitcher but a menace for the batsman or batter at the other end.

Here's a video about Sialkot factory manufacturing Brazuca:


Adidas Brazuca being made in Pakistan by Lahorevideos
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Friday, June 13, 2014

World Bank Revises Pakistan Poverty Rate Sharply Down

Oops! The World Bank made a big mistake. The number of Pakistanis living below the 2005 $1.25 poverty line (set at $1.44 for 2011) is 4.8 million, less than one-seventh of the 35.1 million reported earlier.  It is a huge drop from about 20% of the population to 3% of the population living below the international poverty line.
World Bank's Revised Poverty Estimates (Source: CGD)

Poverty rates for many other nations, including India and Bangladesh,  have also seen dramatic downward revisions. As a result, India now has 102 million poor, just slightly above China's 99 million. In fact, the new report has cut the world poverty rate in half from 19.7% to 8.9%. Reduction from 21% to 3% for Pakistan poverty is much sharper than the rest of the world because ICP 2011 found it to be the second cheapest in the world.

The revision became necessary after the World Bank's International Comparison Program (ICP) completed a detailed study of a list of around 800 household and non-household products to compare real purchasing power for trans-national income comparison program (ICP). The 2011 ICP findings concluded that Pakistan's per capita income is US$4,450.00, just slightly below India's US$4,735.00

Here's how the Center for Global Development blog post by Sarah Dykstra, Charles Kenny and Justin Sandefur explains the reasons for the latest revisions:

"In checking our methodology (prompted by Laurence Chandy, to whom thanks), we realize that we underestimated the impact of the new PPP lines on poverty due to two mistakes in the computer code underlying the original version of this post: we used 2010 CPI figures where we meant to use 2011, and conversely, we used 2011 population figures where we meant to use 2010."

The CDG post explains the new poverty figures for Pakistan and many other developing countries as follows:

"What lies behind the dramatic changes in calculated GDP and poverty rates? A big factor may be that the national inflation rates used to convert incomes into 2005 PPP dollars in the last few years appear to be higher than the rate of inflation reflected in the baskets of goods and services measured by the two rounds of ICP surveys: Pakistan’s PPP conversion rate for GDP was 19.1 Rupees to the dollar in 2005 and 24.4 in 2011 — a gentle increase of 28 percent. The Consumer Price Index in Pakistan has gone up 102 percent over that same period. That might reflect changing or inadequate ICP commodity baskets or consumption data in one or both years, or mismeasurement of prices by Pakistan’s statistical agencies. But whatever the reason, it appears to apply to a lot of countries. Very few places saw PPP conversion rates climb close to or more than CPIs between 2005 and 2011, which is why poverty rates based on the 2011 PPP numbers tend to be lower."

The CDG staffers have offered the following apology to everyone who used their incorrect data: "We have egg on our faces. We're very sorry to those who quoted our original estimates and are contacting a number of them to notify them of the mistake and updated post".

Related Links:

Haq's Musings

Pakistan's Revised PPP GDP 2011

Pakistan Among Top 25 World Economies

Pakistan's Per Capita Income

Pakistan Fares Better Than Neighbors on World Misery Index

Pakistan's Underground Economy

India Pakistan Comparison 

Pakistan Economic History

Pakistan's Expected Demographic Dividend

Monday, June 2, 2014

Pakistan Facing Another Lost Decade Like 1990s?

Meager 4.1% GDP growth reported by Pakistan for 2013-14 caps sixth consecutive year of disappointing economic performance under "democratic" governments in the country. This slow growth brings back bitter memories of the last lost decade of 1990s when economic growth plummeted to between 3% and 4%, poverty rose to 33%, inflation was in double digits and the foreign debt mounted to nearly the entire GDP of Pakistan as the governments of Benazir Bhutto (PPP) and Nawaz Sharif (PMLN) played musical chairs.

Pakistan GDP Growth Rates Since 1993. Source: World Bank



Economy in 1990s:

Before the current Prime Minister Nawaz Sharif was ousted by General Pervez Musharraf  in 1999, Pakistan's two main political parties had presided over a decade of corruption and mismanagement. In 1999 Pakistan’s economy was the slowest in South Asia while its total public debt as percentage of GDP was the highest in the region– 99.3 percent of its GDP and 629 percent of its revenue receipts, compared to Sri Lanka (91.1% and 528.3% respectively in 1998) and India (47.2% and 384.9% respectively in 1998). Internal Debt of Pakistan in 1999 was 45.6 per cent of GDP and 289.1 per cent of its revenue receipts, as compared to Sri Lanka (45.7% and 264.8% respectively in 1998) and India (44.0% and 358.4% respectively in 1998).

Musharraf Era:

Under President Musharraf's leadership, Pakistan became one of the four fastest growing economies in the Asian region during 2000-07 with its growth averaging over 6 per cent per year for most of this period. As a result of strong economic growth, Pakistan succeeded in reducing poverty by one-half, creating almost 13 million jobs, halving the country's debt burden, raising foreign exchange reserves to a comfortable position and propping the country's exchange rate, restoring investors' confidence and most importantly, taking Pakistan out of the IMF Program.

The above facts were acknowledged by the PPP government in a Memorandum of Economic and Financial Policies (MEFP) for 2008/09-2009/10, while signing agreement with the IMF on November 20, 2008. The document clearly (but grudgingly) acknowledged that "Pakistan's economy witnessed a major economic transformation in the last decade. The country's real GDP increased from $60 billion to $170 billion, with per capita income rising from under $500 to over $1000 during 2000-07" elevating Pakistan from low-income to middle-income country.



IMF MOU of 2008 further acknowledged that Pakistan's "volume of international trade increased from $20 billion to nearly $60 billion. The improved macroeconomic performance enabled Pakistan to re-enter the international capital markets in the mid-2000s. Large capital inflows financed the current account deficit and contributed to an increase in gross official reserves to $14.3 billion at end-June 2007. Buoyant output growth, low inflation, and the government's social policies contributed to a reduction in poverty and improvement in many social indicators". (see MEFP, November 20, 2008, Para 1)



Pakistan experienced rapid economic and human capital growth in years 2000 to 2008 on President Pervez Musharraf's watch. Savings, investments and exports hit new records and the rate of increase in human development reached new highs not seen before or since this period.

Savings and Investments:

Domestic savings rate reached 18% of the GDP and foreign direct investment (FDI) hit a record level of $5.4 billion in 2007-8. This combination of domestic and foreign investments nearly tripled the size of the economy from $60 billion in 1999 to $170 billion in 2007, according to IMF. Exports nearly tripled from about $7 billion in 1999-2000 to $22 billion in 2007-2008, adding millions of more jobs. Pakistan was lifted from a poor, low-income country with per capita income of just $500 in 1999 to a middle-income country with per capita income exceeding $1000 in 2007.

Pakistan Per Capita Income 1960-2012. Source: World Bank 


The PPP government summed up General Musharraf's accomplishments well when it signed a 2008 Memorandum of Understanding with the International Monetary Fund which said:



"Pakistan's economy witnessed a major economic transformation in the last decade. The country's real GDP increased from $60 billion to $170 billion, with per capita income rising from under $500 to over $1000 during 2000-07" to elevate Pakistan from low-income to middle-income group. It further acknowledged that "the volume of international trade increased from $20 billion to nearly $60 billion. The improved macroeconomic performance enabled Pakistan to re-enter the international capital markets in the mid-2000s. Large capital inflows financed the current account deficit and contributed to an increase in gross official reserves to $14.3 billion at end-June 2007. Buoyant output growth, low inflation, and the government's social policies contributed to a reduction in poverty and improvement in many social indicators". (see MEFP, November 20, 2008, Para 1)

Human Capital Development: 

In addition to the economic revival, Musharraf focused on social sector as well. Pakistan's HDI grew an average rate of 2.7% per year under President Musharraf from 2000 to 2007, and then its pace slowed to 0.7% per year in 2008 to 2012 under elected politicians, according to the 2013 Human Development Report titled “The Rise of the South: Human Progress in a Diverse World”.



Overall, Pakistan's human development score rose by 18.9% during Musharraf years and increased just 3.4% under elected leadership since 2008. The news on the human development front got even worse in the last three years, with HDI growth slowing down as low as 0.59% — a paltry average annual increase of under 0.20 per cent. Going further back to the  decade of 1990s when the civilian leadership of the country alternated between PML (N) and PPP,  the increase in Pakistan's HDI was 9.3% from 1990 to 2000, less than half of the HDI gain of 18.9% on Musharraf's watch from 2000 to 2007.


Acceleration of HDI growth during Musharraf years was not an accident.  Not only did Musharraf's policies attracted significant new domestic and foreign investments to accelerate economic growth, they also helped create 13 million new jobs, cut poverty in half and halved the country's total debt burden in the period from 2000 to 2007, his government also ensured significant investment and focus on education and health care. The annual budget for higher education increased from only Rs 500 million in 2000 to Rs 28 billion in 2008, to lay the foundations of the development of a strong knowledge economy, according to former education minister Dr. Ata ur Rehman.

Student enrollment in universities increased from 270,000 to 900,000 and the number of universities and degree awarding institutions increased from 57 in 2000 to 137 by 2008. Government R&D spending jumped from 0.1% of GDP in 1999 to 0.7% of GDP in 2007. In 2011, a Pakistani government commission on education found that public funding for education has been cut from 2.5% of GDP in 2007 to just 1.5% - less than the annual subsidy given to the various PSUs including Pakistan Steel and PIA, both of which  continue to sustain huge losses due to patronage-based hiring.

To see a discussion of the above subject and the current situation, please watch the following video:

http://vimeo.com/84504051



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