Page 63 - CMA Journal (Nov-Dec 2025)

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Another significant development was the establishment of radicalization, narcotics, and militarization, which
the Pakistan Industrial Development Corporation (PIDC) in distorted its moral fabric and social conscience.
1952. PIDC played a pivotal role in the creation of Subsequent governments in the 1990s emphasized
enterprises in textiles, cement, fertilizers, paper, and privatization and deregulation as reactionary policies, as
engineering, sectors that later acted as the backbone of the country faced deep economic crises of growing foreign
Pakistan’s early manufacturing growth. The late 1950s and debt, limited fiscal space, low literacy rates,
1960s witnessed strong industrial expansion supported by unemployment, and poverty. These challenges were
export incentives, industrial estates, and growing compounded by high population growth and energy
agro-processing capacity. Partition, as well as the migration crises. These reactionary policies lacked foundational
to and from the country, created opportunities which were support from parallel investments in technology, research,
captured by a few, and gains were uneven. Industrial or human capital. In fact, the fiscal gap was not available to
ownership remained concentrated among a few families. successful governments in the 1990s for such reforms.
In the 1960s, the agrarian reforms were centered primarily The industrial structure remained narrow and vulnerable
on land redistribution, while largely neglecting equitable to shocks. After the wrap-up of the Afghan war, the US was
water rights and improved rural credit systems. These not happy with Pakistan’s pursuit of the nuclear program.
reforms were incomplete and politically compromised. Through the Pressler Amendment, the US cut its aid to
Pakistan’s powerful civil-military bureaucracy inherited Pakistan, and the economy’s vulnerability was once again
British colonial administrative structures. Instead of exposed to foreign powers. Energy shortages, exchange
restructuring them for broad-based development, the rate pressures, and climate-related disruptions further
ruling elite aligned with Western strategic interests. intensified these vulnerabilities. The economy possessed
limited depth, and the masses were still outside the
The country’s economic models prioritized profit, state
power, and geopolitical alignment. Indigenous peoples, structural economy, and their indigenous knowledge was
relegated to the status of being outdated or
local customs, and principles of living in balance with unfashionable. Rivalry with India, involvement in the
nature were overlooked. In fact, the country missed Afghan conflict, and Iran’s strained relationship with the
principles centered on stewardship, restraint, and United States, combined with continual strategic
ecological reciprocity that might have supported more preoccupations, prevented Pakistan from pursuing
sustainable rural development, water governance, and meaningful regional cooperation.
social equity.
After 9/11 in 2001, Pakistan once again aligned itself with
In 1970s the economy was nationalized and agrarian the United States. The country witnessed a second surge of
reforms aligned with global development idealism. external financing into the economy. Once again, the
Zulfikar Ali Bhutto moved swiftly to implement reforms, inflow was not the outcome of domestic economic
partly as a popularity measure, responding to a nation that performance, but rather a consequence of Pakistan’s
was eagerly expecting change. The fall of Dhaka provided renewed strategic partnership with the United States. The
the necessary space for him to implement the reforms economic takeaway was straightforward: as a nation, we
without surface resistance. Crucially, politically must limit foreign dollar injections that are not rooted in
experienced comrades capable of overseeing the reforms’ real economic productivity.
faithful implementation were missing at that moment.
Zulfaqar Ali Bhutto had neither the time nor the Current Economic Performance
opportunity to cultivate such a cadre within his political or Pakistan’s economic landscape reflects persistent
bureaucratic ranks. In fact, he was encircled by structural issues, stagnation, limited public participation in
opportunists and self-styled intellectuals.
economic governance, and weak integration of ecological
As a result, the implementation mechanism was in the concerns. Nearly eight decades after gaining
hands of the elite-controlled bureaucracy. The independence from British rule in 1947, the country
bureaucracy was naturally dissatisfied with the reforms, continues to be ruled by elites with little commitment to
and they were aware of the weaknesses of the system and collective welfare. It ranks low on the Human Development
capitalized on them at a critical moment, especially when Index (0.544; 168th) and high on the Climate Risk Index
the vulnerabilities of Zulfaqar Ali Bhutto and his inner circle 2026 (15th). Pakistan’s major cities routinely appear among
became fully exposed. Industrial productivity declined. the world’s most polluted in IQAir rankings, and the nation
The entire reform agenda ultimately collapsed with the fall remains among the small group of countries where polio
of Zulfaqar Ali Bhutto and was replaced by a wave of has yet to be eradicated.
radical Islamization.
According to the Economic Survey of Pakistan 2024–25,
After a decade of Islamization and the Afghan war, the the GDP, valued at current market prices, reached Rs
country’s economy was infused with dollars, not through 114,692 billion (USD 411 billion) and is ranked among the
national economic effort, but largely due to Pakistan’s top ~40, 45 economies globally. The country is ranked 5th
strategic alignment with the United States and Saudi most populous country, and its share of the world
Arabia. During the same period, foreign exchange was population is about 3.1%, however Pakistan’s share of
superficially maintained as stable. Society became global GDP remains small, roughly 0.9% of total world
contaminated by forces of externally implanted output as of 2025.

ICMA’s Chartered Management Accountant, Nov-Dec 2025