What's new

Pakistan Cut Public Debt in Half On Musharraf's Watch in 1999-2008

During Mushy's time CIA was paying both him and his generals billions off the books. Just like they were paying off the warlords in Afghanistan hundreds of millions, they were doing the same with our generals.

I know many a Pakistani generals finding posh post retirement posts in various think tanks and military/state affiliated educational institutes in US. I know one whose son used to play cricket with us in mid 2000's and his father an ex Maj. Gen. had a teaching gig at Naval post graduate School in Monterey, CA.
 
Conspiracy theorist will always says nawaz sharif got nothing and mushi got everythibg

They think like pakistan usa has money laundering black books worths billions of dollars
Regardless of which Pakistani regime got more aid, let's all agree that only Israel actually put that money to proper use...

Our leaders and elites squander every opportunity given to them. They leave us to debate which of them was worse, which only serves to help them return to power while at the same time creating disunity among Pakistanis. It's a real shame.
 
During Mushy's time CIA was paying both him and his generals billions off the books. Just like they were paying off the warlords in Afghanistan hundreds of millions, they were doing the same with our generals.

I know many a Pakistani generals finding posh post retirement posts in various think tanks and military/state affiliated educational institutes in US. I know one whose son used to play cricket with us in mid 2000's and his father an ex Maj. Gen. had a teaching gig at Naval post graduate School in Monterey, CA.
Pos destroyed the nation from Fata to Karachi for Thier own personal gains
 
it is absolutely wrong to say that musharraf era got no aid. heres is a chart below economic, military and coalition fund. Despite this we went to the IMF.

What about forgiving debt, low interest loans, and favourable trade agreements?

problem is none of the military regimes brought about structural reforms so as not to antagonize corrupt politicians who help in referendums and political support.

 

Attachments

  • Screenshot_20220125-121617_Samsung Internet.jpg
    Screenshot_20220125-121617_Samsung Internet.jpg
    177.2 KB · Views: 43
resident Pervez Musharraf inherited a massive debt of over 100% of GDP run up by the Pakistan Peoples Party and the Pakistan Muslim League (Nawaz) governments in 1990s

same thing happened in 2018 man, this is absolutely ridiculous man
A national security risks from the very beginning
Pakistanis will vote them back in, and our security forces will allow it. We never learn from our mistakes!
 
Regardless of which Pakistani regime got more aid, let's all agree that only Israel actually put that money to proper use...

Our leaders and elites squander every opportunity given to them. They leave us to debate which of them was worse, which only serves to help them return to power while at the same time creating disunity among Pakistanis. It's a real shame.

Exactly, no military regimes have brought about reforms for instance Pak penal code is still based on 1860 code while criminal procedures on 1898 code. No real documentation of economy has taken place. 5% of land owners own 2/3rd of land while emjoying tax free status on agri products. No bureaucratic reforms, no stopping massive smuggling playing havoc with economy and then we have to change our entire budget for 1 billion from IMF and about civil politicians less said the better about those utterly disgraceful lot.
 
Because of how superbly PTI Government has performed in its 3+ years so far? Fortunately, the graph by IMF is right at the very top of the first page of this thread which is visible to all who are not blind. in 2018 the debt to GDP was around 70% and after 3 years of PTI Governance, it is touching almost 90%!!!!
Wrong, debt to GDP is 72%
 
All this talk about US aid to Pakistan is highly exaggerated.

US%2BAid%2Bto%2BIndia.png


Pakistan is not even in the top 10 in terms of total US assistance to Pakistan

 
Last edited:
US aid to Pakistan has been a tiny percentage of Pakistan's GDP since the 1990s.

It makes very little difference to Pakistan's overall economic performance.

Foreign+Aid+Percent+of+Pak+GDP.jpg


 
Pakistan has not received aid from once source. Other sources like Japan, EU countries, KSA should also be included in any analysis.

Pakistani elite has failed to implement reforms like south korea and israel and time and again go to IMF or GCC despite foreign aid and just do not go ahead with solid reforms.

Same thing happened with musharraf era, trade and fiscal deficit increased so did Current account deficit and domestic debt.

Strong fundamentals are needed for the country to absorb shocks of oil prices and other external factors.
 
Perhaps with at least a second term for PTI, Pakistan too can get back to similar metrics (such as Debt to GDP) by 2028.
PTI can do nothing unless establishment has a suicide mission by freeing up bureaucracy, Military and Judiciary from corrupt elements which will never happen.
 
Pakistan has not received aid from once source. Other sources like Japan, EU countries, KSA should also be included in any analysis.

Pakistani elite has failed to implement reforms like south korea and israel and time and again go to IMF or GCC despite foreign aid and just do not go ahead with solid reforms.

Same thing happened with musharraf era, trade and fiscal deficit increased so did Current account deficit and domestic debt.

Strong fundamentals are needed for the country to absorb shocks of oil prices and other external factors.
Net ODA (Official Development Aid) graph below includes all foreign aid received by Pakistan.


Foreign+Aid+Percent+of+Pak+GDP.jpg


 

In 1999, President Pervez Musharraf inherited a massive debt of over 100% of GDP run up by the Pakistan Peoples Party and the Pakistan Muslim League (Nawaz) governments in 1990s. Musharraf's policies not only revived the bankrupt economy but also brought down debt to 52% of GDP by 2007.

Pakistan Debt to GDP 1995-2021. Source: IMF




PPP Government's 2008 Letter to IMF:

In a letter to the International Monetary Fund in 2008, the PPP government hailed Musharraf's economic record without mentioning his name in the following words:

"Pakistan's economy witnessed a major economic transformation in the last decade (2000-2008). 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.....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).

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.




Human Capital Development:

In addition to the economic revival, Musharraf focused on the social sector as well. Pakistan's Human Development Index (HDI) score 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 the 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 accelerate economic growth, 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.

Pakistan textile exports more than doubled from $5.2 billion to more than $11 billion during the Musharraf years. Exports soared 19.43% in 2001, 20% in 2004, 24.5% in 2005 and 11.23% in 2006, all on President Musharraf's watch, according to "The Rise and Fall of Pakistan's Textile Industry: An Analytical View" published by Javed Memon, Abdul Aziz and Muhammad Qayyum.
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.
Comparing Per Capita GDP Trajectory in South Asia. Source: The Economist
Until 2010, Bangladesh was a laggard in South Asia region. Its per capita income was about half of Pakistan's. Now Bangladesh's per capita GDP is higher than both India's and Pakistan's. What changed? The biggest change is Bangladeshi leader Shaikh Hasina's decision to stifle the unruly Opposition and the media to bring political and economic stability to the South Asian nation of 160 million people. It has eliminated a constant sense of crisis and assured investors and businesses of continuity of government policies. With development taking precedence over democracy, Shaikh Hasina followed the example of Asian Tigers by focusing on export-led economic growth of her country. She incentivized the export-oriented garment industry and invested in human development. Bangladesh now outperforms India and Pakistan in a whole range of socioeconomic indicators: exports, economic growth, infant mortality rate, primary school enrollment, fertility rate and life expectancy.
Related Links:

Haq's Musings

South Asia Investor Review

Banner Year For Pakistani Tech Startups

Pakistan to Be World's 7th Largest Consumer Market By 2030

Sehat Card: Universal Healthcare in Pakistan

Textile Boom in Pakistan

Construction and Manufacturing Driving Pakistan's Recovery

Demographic Dividend and Record Remittances

Mobile Phone Manufacturing in Pakistan

Covid Crisis in India

Pakistan's COVID Handling

Riaz Haq's Youtube Channel

PakAlumni: Pakistani Social Network

All hail the easy money (free-flowing USD) due to WoT in Musharraf years. The growth spurt country experienced was never sustainable. It was a consumer growth bubble financed by cheap credit that was bound to burst and it did. When it did, it did so spectacularly leaving the nation stuck in 21% inflation post-2007 period and into the lap of another IMF program. The economic situation was direr than today and Shaukat Tareen undertook painful macroeconomic adjustments then.
 
Net ODA (Official Development Aid) graph below includes all foreign aid received by Pakistan.

Thanks Janab,

The study below analyzes multilateral aid vs bilateral aid. Multilateral aid played a significant role in economic growth according to this study whether foreign aid has a positive effect on economy overall is another issue.


One must also analyze contribution of remittances as a share of GDP. In 2020 remittances made up almost 10% of GDP second highest in S. asia after nepal.

We hope Pakistan's reliance on external factors reduces and we experience genuine and sustainable growth.

All hail the easy money (free-flowing USD) due to WoT in Musharraf years. The growth spurt country experienced was never sustainable. It was a consumer growth bubble financed by cheap credit that was bound to burst and it did. When it did, it did so spectacularly leaving the nation stuck in 21% inflation post-2007 period and into the lap of another IMF program. The economic situation was direr than today and Shaukat Tareen undertook painful macroeconomic adjustments then.

Inflation was I guess 12% and some good things did happen like FDI increased, stable exchange rate overall deregulation of economy, but fundamentals were not strong and could not absorb external shocks. Current Account deficit became unbearable and PPP went to IMf.
 
Last edited:

Pakistan Affairs Latest Posts

Back
Top Bottom