By S.M. Inam
No matter how acute the economic distress faced by ordinary Pakistanis, governments have long relied on a familiar narrative: the crisis has been overcome, growth is underway, and the wheels of progress are turning once again. Prime Minister Shehbaz Sharif’s recent statements offered precisely this refrain. Speaking at the launch of the National Regulatory Reforms, he asserted that Pakistan had emerged from economic turmoil, that institutional reforms would improve governance, and that the country’s young population would be transformed into a productive asset through skills development and employment initiatives. He painted a picture of a government working tirelessly to rescue the nation from the brink. Sharif recounted that when his administration took office, the economy was teetering on collapse: policy rates had stifled activity, inflation was soaring, investment had dried up, and the country faced the prospect of bankruptcy.
Against this backdrop of despair, he said, his team had labored day and night to stabilize the economy and restore confidence. The prime minister argued that decades of public frustration over cumbersome regulations, slow procedures, and restrictive laws had finally been addressed through a “quantum jump” in regulatory reform, promising to relieve the business community and encourage investment. Finance Minister Muhammad Aurangzeb reinforced this narrative, insisting there would be no mini-budget. He claimed revenue shortfalls would be met through improved compliance and better governance rather than new taxation. The policy rate, he noted, had fallen from 24% to 11%, and if current trends continued, inflation could drop to single digits. Addressing business leaders in Lahore, Aurangzeb emphasized the principle of accountability, urging that bureaucrats, like parliamentarians, declare their assets—a nod to reformist intentions, even if implementation remained uncertain.
Yet these optimistic claims contrasted sharply with the lived experience of much of the population. Assessments from the International Monetary Fund had indicated a rise in poverty, with more than a quarter of Pakistanis now living below the poverty line. The IMF called for close monitoring of anti-poverty efforts, highlighting that macroeconomic stabilization had done little to ease the struggles of ordinary households. On the ground, a walk through markets and neighborhoods suggested that the improvements touted by the government had benefited a relatively narrow elite circle, rather than the broader population. This elite, notably the bureaucracy, remains a central pillar of power in Pakistan. No government can function without it, yet meaningful accountability has been elusive. Bureaucrats continue to operate in ways that protect their collective interests, largely impervious to reformist rhetoric or political promises.
Many analysts argue that as long as this imbalance persists—where the bureaucracy and elite circles wield disproportionate influence—broader economic recovery will remain fragile and uneven. Foreign investment offers another lens on the government’s claims. Energetic diplomacy and high-profile announcements have so far failed to convert into measurable inflows or long-term confidence. Investors are aware of structural barriers that inhibit enterprise: cumbersome regulations, policy inconsistencies, and bureaucratic interference remain pervasive. While supportive countries can extend limited assistance, the ultimate responsibility lies with Pakistan itself. Without dismantling systemic obstacles and creating an environment conducive to sustained investment, government promises of economic revival risk being nothing more than aspirational rhetoric.
Underlying all these issues is Pakistan’s long-standing dependence on the International Monetary Fund. Successive administrations have relied on the fund to stabilize the economy, often agreeing to conditionalities that, despite their reformist language, have reinforced structural weaknesses. This pattern of dependency has left the economy vulnerable, with little capacity to function independently or absorb shocks. If the government is sincere about fostering genuine recovery and public welfare, it must chart a course away from perpetual reliance on external support, while simultaneously addressing entrenched domestic power imbalances.
The new regulatory reforms, though potentially beneficial on paper, cannot compensate for these deeper challenges. Reducing procedural hurdles or streamlining laws may ease certain bottlenecks for businesses, but without addressing the structural and governance deficits that underpin economic fragility, the benefits will remain limited. Similarly, claims that youth skills training and employment initiatives will transform the labor market must be scrutinized in the context of systemic unemployment, underinvestment in education, and the disconnect between policy announcements and implementation on the ground.
The contrast between official optimism and public reality underscores a broader tension in Pakistan’s political economy. Governments often speak in the language of recovery, growth, and reform, even as significant portions of the population continue to struggle with rising prices, limited access to services, and stagnant wages. Macro-level indicators may show some stabilization, yet the persistence of poverty, inequality, and bureaucratic inertia reveal a more complicated picture. Economic recovery cannot be measured solely by policy pronouncements or falling interest rates; it must be evident in the daily lives of citizens who face mounting costs and dwindling opportunities.
(The writer is a former government officer and a senior analyst on national and international affairs, can be reached at inam@metro-morning.com)
