Obstacles to Economic Development in Pakistan

Obstacles to Economic Development in Pakistan

Point out various obstacles to economic development of Pakistan and also narrate the current status of Pakistan’s economy.

Obstacles to Economic Development in Pakistan

Anything that makes slow the process of economic development is called obstacles to its functioning. The various obstacles to the Economic development 0″ Pakistan may be categorized as economic, social, cultural, administrative and political.

Obstacles to Economic Development in Pakistan

Economic Obstacles

Inadequacy of natural resources

Natural resources are comprised of geographical configuration, soil, climate water resources, minerals etc. No country in the world is self-sufficient in this respect but fair degree of resources is needed for economic growth. In this respect, the position of Pakistan is not so discouraging but the overa’. position of Pakistan ..in this respect is not so rich. There are problems of salinity, water logging, floods, droughts, lack of forests, oil and gas, iror. gypsum, coal, copper, water, etc.

Under-developed human resources.

The labour force in developing countries, especially in Pakistan, is illiterate and unskilled. Furthermore, it is not up to the mark in physical health an^ energy needed for developmental activities.

Shortcomings in technology

According to the latest statistics, sixty-five percent populations are dependentupon agriculture but this sector is carried on with primitive technique? There is a severe lack of sophisticated and automatic machinery in small and large scale industries. The output is not up to the mark quantitatively as we as qualitatively. We cannot export our products to earn foreign exchange On the other hand; we import many products and lose our foreign exchange Due to backwardness in technology only raw material is exported.

Inadequate financial resources and capital formation

Lack of physical capital in the sense of buildings, machinery and tools, raw materials and other intermediate goods is a serious obstacle to the economic development of Pakistan. They are produced by investment resulting from savings. But our saving ration is very low and not enough for capital formation.

Unfavourable economic institutions

The functioning of banks, insurance companies and stock exchanges is not up to the mark. They cannot provide money on better interest rates which is necessary for capital formation. Primitive techniques are used in industrial and agricultural small scale production. The law of inheritance divides the land into uneconomic units which are not suitable for farming with modern machinery.

 Social Obstacles

–             Population pressure

It occurs when the number of population exceeds the resources of the country. It also happens when medical facilities decrease death rate and family planning is not so effective due to religious and cultural values of the society. Latest population figures show that population of Pakistan is 124.45 million and growth rate is 3 percent. In 1981, total population of the country was 84.25 million (Pakistan Basic Facts — 1994). Population growth increases dependency i.e. it increases the number of children who are consumers only. They contribute nothing in the production of the society.

–             Unfavourable health conditions

There is a severe shortage of medical facilities in Pakistan. According to the figures of 1993, there were only 796 hospitals, 4144 dispensaries, 63003 registered doctors, 2401 registered dentists, 20245 registered nurses, 3920 registered L.H.Vs, and 1918 persons per doctor for the population of 124.45 million in Pakistan (Pakistan Basic Facts — 1994). Therefore, masses are still subject to different diseases such as malaria, tuberculosis, typhoid etc. They are physically weak due to mal/under-nourishment. These problems lessen the productive efficiency.

–             Mass illiteracy

It is estimated that in 1994 literacy rate was 36.8 percent in Pakistan which is awfully low. Illiterate people find it difficult to organize and pursue their economic activities. They do not know “technical-know-how” and cannot adjust themselves on proper lines which effect the productive capabilities, saving ratio, and capital formation.

–                       Cultural Obstacles

Cultural obstacles spring from people’s conventions, attitudes, and beliefs. In the social normative values of Pakistan, family planning, female education and female job- are considered unislamic, socially detestable, and against the social values. Heavy expenditures are incurred on birth, marriage, circumcision, and death occasions Exhibition of weapons, jewllery, and buildings are salient features of our society and are considered symbols of prestige.

Administrative Obstacles and Political Incompetence

The political and democratic process was disrupted several times by martial law regimes which lacked constitutional validity and support of the masses. The democratic regimes in Pakistan cannot be called democratic in its true sense and as a result political and economic institutions were not established properly. Administrative machinery is inefficient because appointments are made on political basis, not on merit basis, the administrative personnel is dishonest and corrupt and there is no system of checks and balances in Pakistan. The political leadership is self-centered and .the masses are politically immature. Politicians deceive the masses through catchy slogans and the masses cost their votes on the basis of baradari, region, gender, and vested interests and not on the basis of competency and capabilities of politicians.

 

Lack of National Spirit

This has been manifested in the form of regional, provincial, tribal, and similar other considerations in our body politics. Masses are thinking in racial, provincial, religious, ethnic, and tribal terms and their vote behaviour is influenced by these bonds Politicians exploit these feelings and serve their own interests. The speeches and tones of the politicians are totally changed indifferent provinces. These politicians are creating a sense of deprivation in the masses of different provinces and ethnic groups. Media has failed to create the feelings of federation in the masses. These developments have led the country toward economic, political, and social crises and disrupted the process of economic development.

State of the Pakistan Economy

There have been significant developments in respect of a number of macroeconomic indicators during fiscal 1995-96. The GDP growth rate increased form 4.4 percent in 1994-95 to 6.1 percent in 1995-96 slightly improving upon the average growth rate of the last four decades. The agriculture sector grows by 6.7 percent with record production figures for rice and wheat. Cotton output recorded an increase of 21.8 percent. The budget deficit is now estimated around 5.0 percent of GDP. Fiscal checks were introduced to contain growth in expenditure and measures were taken to bring about greater elasticity in government’s revenues. Tight monetary policy during the year kept monetary expansion down to 8.4 percent during July-March 1995-96 against 9.8 percent in the corresponding period last year. This was within the annual expansion target of 12.1 percent.

With a view to addressing the concern of low income groups government have pursued policies in the social sectors to improve the standard of living of the common man by improving literacy rate, improving the status of women, curtailing population growth and providing primary health care to the poor.

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