After an early phase of impressive growth, Pakistan’s economy was unable to realize its potential for improving the lives of millions of citizens, thereby contributing to the repeated crises facing the state.
S. Akbar Zaidi is no longer with the Carnegie Endowment.
S. Akbar Zaidi was a visiting scholar in the Carnegie Endowment’s South Asia Program. A visiting professor at Columbia University, with a joint appointment in the School of International Public Affairs and MESAAS, the Department of the Middle Eastern, South Asian, and African Studies, his research focuses on development, governance, and political economy in South Asia.
Zaidi taught economics at the University of Karachi from 1983 to 1996 before becoming a visiting scholar at the University of Oxford (1998) and later a research fellow at the University of Pennsylvania’s Institute for the Advanced Study of India in New Delhi (2002–2003). From 2004 to 2005 he was a visiting professor at SAIS and in 2008 he was a Reagan-Fascell Democracy Fellow at the National Endowment for Democracy. Zaidi’s twelfth book, Military, Civil Society and Democratization in Pakistan, was published by Vanguard Press, Lahore in October 2010.
After an early phase of impressive growth, Pakistan’s economy was unable to realize its potential for improving the lives of millions of citizens, thereby contributing to the repeated crises facing the state.
While Pakistan has always been dependent on foreign aid, U.S. aid to the Pakistani military has served to strengthen their power in Pakistan’s political economy, giving them the ability to sidestep the elected civilian government.
The increasingly harsh rhetoric from U.S. officials for Pakistan’s spy agency and its alleged support for the insurgent Haqqani network’s recent attacks on American interests has raised tensions in an already strained bilateral relationship.
A longer-term U.S. engagement and commitment to civilian and development aid in Pakistan might result in strengthening democracy in the country instead of reinforcing the military dominance that thwarts U.S. counterterrorism goals.
As the floodwaters recede, Pakistan is assessing the impact of its worst-ever flooding and beginning the long rebuilding process. In spite of this tragedy, the terrible losses should not prevent Pakistan’s economy from growing nor severely restrict its military’s counterterrorism efforts.
Pakistan's economic instability stems in large part from low government revenue due to the elite's use of tax evasions, loopholes, and exemptions. Without tax reform, Pakistan will continue to run an unsustainable debt and be forced to rely on Western donors for bailouts.