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Article was Written in August 2001.
By:AHMAD FARUQUI
This paper explores alternative long-term views of Pakistan in the year 2015, and lays out policy options for the US. Pakistan is the world’s sixth most populous country, with a population of 150 million. It is one of the largest Muslim countries in the world. Its military is armed with nuclear weapons and has the seventh largest force in the world, with a strength of 600,000.1 It is located strategically, with Iran and Afghanistan to the west, China to the north, and India to the east. Its southwestern corner abuts the opening to the Persian Gulf, the Strait of Hormuz. It is a low-income country, with a per capita income of $470.
In the sixties, Pakistan was viewed as a model developing country by the Harvard Development Advisory Service. Growth in the gross domestic product (GDP) averaged six percent a year, about 50% higher than neighbouring India’s four percent a year growth rate during the same period. The rate of growth dipped in the seventies, but picked up again in the eighties. During the nineties, its economy slowed down to a crawl. Due to decades of economic mismanagement in which fiscal and international trade deficits were incurred, foreign debt obligations rose to $37 billion, more than half of the GDP of about $65 billion. Servicing of this debt consumes half of the national budget, and defence spending consume about a quarter.
The country is heavily dependent on its agricultural sector, which accounts for 70% of the population, 45% of the employment, and 25% of the gross national product. Agricultural performance depends on weather conditions and the ability to deal with pest infestations. During the current fiscal year, problems triggered by the widespread drought in South Asia have reduced GNP growth to 2.6%, not sufficient to cover the growth in population of 2.8%.2 About 38% of the population live below the poverty line, defined by the World Bank as an income per person of less than one dollar a day. The incidence of poverty in China is 4.6%, while in India it is 35%.3 Despondent with the economic outlook of the country, many Pakistanis are anxious to emigrate. A recent Gallup survey found that 62% of the adult population would like to go abroad to work, and that half of those wishing to work overseas do not wish to return home. A similar survey carried out in 1984 found that only 17% of Pakistanis were eager to settle abroad.4
Law and order has broken down in the urban centres, due to high rates of youth unemployment, increasing inequalities in the distribution of income, and corruption in the police force. Armed robberies, kidnappings and assassinations are commonplace. The mandate of the federal government has virtually ceased to exist in many rural areas, especially the tribal agencies of the Frontier province that border Afghanistan. Rivalries between Punjab, the largest province with 57% of the population whose members dominate the nation’s military and civil services, and the three smaller provinces of Sindh, Frontier and Balochistan are at an all time high, with problems in the allocation of water at the top of the list of issues of contention. The common man lives at the mercy of armed gangs that exploit ethnic and sectarian rivalries to indulge in large-scale violence. In addition, the presence of international terrorist organizations that have taken root in religious institutions disrupts the normal rhythm of life.
In the realm of foreign policy, Pakistan’s major problem continues to be its 53-year old conflict with India, much of it involving conflicting visions of national identity. This conflict finds its most visible expression in the lingering dispute over Kashmir. This conflict has involved many major and minor wars, the last one of which took place in the icy heights of Kargil in the spring of 1999. Militarily, Pakistan’s military has not fared well in its wars with India.5 Fear of India has led to continued enlargement of the military, which has doubled in size since the 1971 war with India that led to the loss of East Pakistan, containing 55% of Pakistan’s population. Because of the absence of strong domestic political institutions, and the presence of a strong feudal culture, the military has dominated the political landscape, and ruled Pakistan for more than half of its existence. Expenditures on the military account for about six percent of the GNP. On paper, the Pakistani military is half the size of India’s military. However, much of the equipment is obsolete and in poor repair. In addition, Indian military spending per soldier is twice as high as Pakistan’s.
The disparity in the conventional arms balance of power with India has led Pakistan to develop a nuclear weapons programme. This programme operated under the doctrine of recessed deterrence till May 1998, when India’s nuclear tests forced the Government of Pakistan to respond with its own tests within two weeks.
How does Pakistan fit into US security strategy? Geographically, it falls within the purview of the US Central Command. As noted by Secretary of State Colin Powell during his recent meeting with Pakistani Foreign Minister Abdul Sattar, Pakistan and the US have been close friends for over fifty years. In the fifties, Pakistan was the only country that belonged to both the CENTO and SEATO alliances formed by John Foster Dulles to contain the expansion of communism in Asia. It also had a bilateral military alliance with the US, and was provided substantial military hardware through the MAP programme to equip five-and-a-half infantry divisions and nine air force squadrons. In the eighties, Pakistan served as a frontline state during the Soviet-Afghan war in the eighties, and received $3.5 billion of military and economic assistance from the US. Supplies included 40 F-16 fighters, Cobra attack helicopters, M-48 A5 main battle tanks, heavy artillery and various infantry weapons including Stinger shoulder-launched SAMs.
In the aftermath of the Afghan war, Pakistan became the accidental home to more than three million Afghan refugees, many of them armed with AK-47 Kalashnikov rifles and engaged in narcotics trafficking. Some of these refugees, veteran mujahideen fighters of the Soviet war, banded together into militant Islamic groups committed to seeking the liberation of Kashmir from Indian rule. This has led some analysts to write about the rise of a jihadist culture in Pakistan.6 However, this analysis fails to recognize that a large portion of the educated middle class in Pakistan, and a major portion of the country’s intelligentsia, has been schooled in western educational institutions, both domestically and abroad. It supports cooperation with the west, and actively opposes confrontation. In addition, the Pakistani business community abjures violence and is interested in promoting economic growth.
On the diplomatic front, Pakistan finds itself currently at cross purposes with the US in three areas:
The US National Intelligence Council (NIC), an arm of the US Central Intelligence Agency, has issued a report containing a grim assessment of Pakistan’s future in the year 2015:9
Pakistan will not recover easily from decades of political and economic mismanagement, divisive policies, lawlessness, corruption and ethnic friction. Nascent democratic reforms will produce little change in the face of opposition from an entrenched political elite and radical Islamic parties. Further domestic decline would benefit Islamic political activists, who may significantly increase their role in national politics and alter the makeup and cohesion of the military —once Pakistan’s most capable institution. In a climate of continuing domestic turmoil, the central government’s control probably will be reduced to the Punjabi heartland and the economic hub of Karachi.
One of the main reasons for Pakistan’s abysmal economic performance is poor governance and corruption in the administration, caused by the failure to develop robust political institutions and by decades of military rule. As much as a quarter of the $60 billion GNP may be lost to these twin problems, representing a total of some $15 billion.10 In a sample of 85 countries, Transparency International found that Pakistan in 1998 was more corrupt than 71 of the nations in the sample, with only Russia, Indonesia, Nigeria and some Latin American countries being more corrupt than Pakistan. India was ranked 66th.11
However, the NIC scenario is not the only future possible for Pakistan. In fact, it may be the low end of the range of possible futures. During the sixties, Pakistan enjoyed decisive political leadership under Field Marshal Ayub Khan and competent economic management. The primary shortcoming of Ayub’s rule was lack of democratic governance, which led to increased interpersonal and inter-provincial inequities in the distribution of income. Under enlightened leadership that uses the right set of policy instruments, Pakistan can once again attain that level of growth performance, without exacerbating income inequalities. There is a regional precedent, represented by the turnaround in India’s growth profile during the nineties.12
Generation of Scenarios
Pakistan’s future is predetermined to a degree by its demographics, its low levels of spending on human and social development over the past several decades, and by the need to pay off its staggering foreign and domestic debts. Additionally, Pakistan’s future is determined by developments in its external environment, many of which are beyond the control of Pakistan’s leaders. However, they can control how they respond to these developments. For example, they may or may not choose to match increases in India’s defence budget. Ultimately, they can control the country’s future evolution by resolving Pakistan’s myriad domestic problems. As stated in the Holy Quran, “God does not change the condition of a people until they change what is in themselves.”
One can presume that the ultimate goal of governance for a developing country is to maximize the welfare and economic wellbeing of its citizenry, so that poverty levels can be reduced, thereby bringing about political stability and social cohesion. Once that has been achieved, the nation would attract higher rates of domestic and foreign investment, both public and private. Higher investments would bring about higher growth in economic output, further lowering poverty levels. Of course, the opposite would occur if government policies reduce economic growth, raise poverty levels and exacerbate political and social tensions.
In the case of Pakistan, the following factors are likely to influence its future development.13
Scenarios
The scenarios described in the previous section can be thought of as resulting from a smooth evolution of events between now and the year 2015. In addition, there is a significant probability that any of the scenarios can degenerate into a sudden crisis. Such a possibility can occur in any scenario, but is particularly strong in Scenarios 4 and 5. Disruptive events that can precipitate a crisis include:
US Policy Alternatives
US strategy in the year 2015 is likely to include a wide range of objectives20, including:
Table 1: Matrix of US Policy Options
1.Diplomatic Policy
Positive Measures
Initiate confidence-building measures between India and Pakistan. Mediation between India and Pakistan. Organize UN initiative(s) in Kashmir. Encourage democracy in Pakistan. Social, cultural and educational exchanges.
Negative Measures
Isolation campaign Rogue-state designation
Economic Policy
Positive Measures
Foreign aid at concessional terms.
Nigerian-style debt write off.
Credit guarantees (OPIC, EXIM, CCC).
World Bank/IMF sponsored aid package.
Science and technology promotion programme
Negative Measures
Embargo on international trade
Military Policy
Positive Measures
Joint exercises in Pakistani waters, air space and land.
Exchange of senior officers.
Training programme for all ranks.
Arms sales.
Assistance in defence production. Bases on Pakistani soil.
Negative Measures
Evacuation of US personnel
Panama/Grenada type mission
Blockade of ports
Iraq-type no fly zones
Cruise missile attacks
Kosovo-type air war
Full-scale ground war
It will be important for the US to engage proactively with Pakistan across the five scenarios described earlier, even though the specific portfolio of policy instruments chosen will vary by scenario.21 Pakistan in the year 2015 will most likely be the largest Muslim country in the world, and by then Islam will have become the second largest religion in the US. There will be a sizeable Pakistani Diaspora in the US, making a strong contribution to the productivity of the US economy. First and second generation Pakistani-American entrepreneurs will establish and manage high-tech companies that employ hundreds of people. Consistent with past practice, Pakistani-American doctors and engineers will occupy leadership positions in their profession. They will diversify into other professions as well, such as journalism, law and economics. On the political front, Pakistani Americans are likely to be represented in many state legislatures; a few may be sitting in the US House of Representatives; and one or two may have contested a senatorial position. They are also likely to be represented in one or more senior positions in the US government.
Pakistan will have a sizeable inventory of nuclear warheads, upwards of 50 warheads. It will be capable of delivering them from air, land and sea based platforms. Fuel for the warheads will come from an expanded programme of nuclear power generation. This programme would be an outgrowth of the 300 MW Chinese-built Chashma nuclear power station that became operational in 2000. Pakistan is also likely to have attained self-sufficiency in a variety of conventional defence systems, and is likely to be a major arms exporter to states in the Gulf region, Southeast Asia and Africa. Likely weapon systems will include submarines (derivatives of the French Agosta class), main battle tanks (derivatives of the Al-Khalid class), and armoured personnel carriers (derivatives of the US M-113).
Its geographic location would have become more salient, with the further development of the energy resources in the Central Asian republics. As these economies grow, they will seek access to the Arabian Sea, and Pakistan may well become the ideal means of transportation for them.
The first two scenarios, featuring Super High Performance and High Performance, will require the US to support Pakistan’s continued economic, political and social development by providing diplomatic and economic incentives. In addition, the US military should be engaged constructively with the Pakistani military, through exchange of senior military officers, military training programmes, and through joint exercises.
The third scenario, Average Performance, will require the US to pursue an expanded set of diplomatic and economic options to encourage economic growth and prevent a drift toward the sluggish performance of the nineties.
The fourth scenario, Low Performance, will require an economic “SWAT team” where the US sends in economic advisors to help the Government of Pakistan salvage its bankrupt economy, and arranges for writing-off a major portion of its foreign debt. In addition, on Pakistan’s request, it may arrange for the creation of a UN sponsored peacekeeping force that would restore law and order.
The fifth scenario, Ultra Low Performance, is clearly the most dangerous of the five considered in this paper. It will require the most nuanced approach on the part of the US. Extreme care will need to be observed to ensure that outright hostility does not develop between the US and Pakistan, as the former tries to insert itself by force into the Pakistani state, in order to prevent Balkanization of the latter, and in order to prevent nuclear weapons from falling into the hands of war Lords. It will be counter productive to label Pakistan a rogue state, since the current policy of labeling nations such as Iran, Libya and Sudan as rogue states has not worked either. It would be wise to avoid US military intervention, since that will further polarize an already difficult and messy situation. It may draw China and Russia into the conflict, precipitating a much larger and potentially very dangerous continental crisis. Indian forces will have to be restrained from entering Pakistan and installing a puppet regime. It would be best to create a peacemaking force under UN auspices. This would of course require the cooperation of China and Russia. Once the semblance of a functioning government has been ensured, emergency economic aid would have to be provided to resuscitate the dysfunctional economy and meet the basic needs of the population.
END NOTES
By:AHMAD FARUQUI
This paper explores alternative long-term views of Pakistan in the year 2015, and lays out policy options for the US. Pakistan is the world’s sixth most populous country, with a population of 150 million. It is one of the largest Muslim countries in the world. Its military is armed with nuclear weapons and has the seventh largest force in the world, with a strength of 600,000.1 It is located strategically, with Iran and Afghanistan to the west, China to the north, and India to the east. Its southwestern corner abuts the opening to the Persian Gulf, the Strait of Hormuz. It is a low-income country, with a per capita income of $470.
In the sixties, Pakistan was viewed as a model developing country by the Harvard Development Advisory Service. Growth in the gross domestic product (GDP) averaged six percent a year, about 50% higher than neighbouring India’s four percent a year growth rate during the same period. The rate of growth dipped in the seventies, but picked up again in the eighties. During the nineties, its economy slowed down to a crawl. Due to decades of economic mismanagement in which fiscal and international trade deficits were incurred, foreign debt obligations rose to $37 billion, more than half of the GDP of about $65 billion. Servicing of this debt consumes half of the national budget, and defence spending consume about a quarter.
The country is heavily dependent on its agricultural sector, which accounts for 70% of the population, 45% of the employment, and 25% of the gross national product. Agricultural performance depends on weather conditions and the ability to deal with pest infestations. During the current fiscal year, problems triggered by the widespread drought in South Asia have reduced GNP growth to 2.6%, not sufficient to cover the growth in population of 2.8%.2 About 38% of the population live below the poverty line, defined by the World Bank as an income per person of less than one dollar a day. The incidence of poverty in China is 4.6%, while in India it is 35%.3 Despondent with the economic outlook of the country, many Pakistanis are anxious to emigrate. A recent Gallup survey found that 62% of the adult population would like to go abroad to work, and that half of those wishing to work overseas do not wish to return home. A similar survey carried out in 1984 found that only 17% of Pakistanis were eager to settle abroad.4
Law and order has broken down in the urban centres, due to high rates of youth unemployment, increasing inequalities in the distribution of income, and corruption in the police force. Armed robberies, kidnappings and assassinations are commonplace. The mandate of the federal government has virtually ceased to exist in many rural areas, especially the tribal agencies of the Frontier province that border Afghanistan. Rivalries between Punjab, the largest province with 57% of the population whose members dominate the nation’s military and civil services, and the three smaller provinces of Sindh, Frontier and Balochistan are at an all time high, with problems in the allocation of water at the top of the list of issues of contention. The common man lives at the mercy of armed gangs that exploit ethnic and sectarian rivalries to indulge in large-scale violence. In addition, the presence of international terrorist organizations that have taken root in religious institutions disrupts the normal rhythm of life.
In the realm of foreign policy, Pakistan’s major problem continues to be its 53-year old conflict with India, much of it involving conflicting visions of national identity. This conflict finds its most visible expression in the lingering dispute over Kashmir. This conflict has involved many major and minor wars, the last one of which took place in the icy heights of Kargil in the spring of 1999. Militarily, Pakistan’s military has not fared well in its wars with India.5 Fear of India has led to continued enlargement of the military, which has doubled in size since the 1971 war with India that led to the loss of East Pakistan, containing 55% of Pakistan’s population. Because of the absence of strong domestic political institutions, and the presence of a strong feudal culture, the military has dominated the political landscape, and ruled Pakistan for more than half of its existence. Expenditures on the military account for about six percent of the GNP. On paper, the Pakistani military is half the size of India’s military. However, much of the equipment is obsolete and in poor repair. In addition, Indian military spending per soldier is twice as high as Pakistan’s.
The disparity in the conventional arms balance of power with India has led Pakistan to develop a nuclear weapons programme. This programme operated under the doctrine of recessed deterrence till May 1998, when India’s nuclear tests forced the Government of Pakistan to respond with its own tests within two weeks.
How does Pakistan fit into US security strategy? Geographically, it falls within the purview of the US Central Command. As noted by Secretary of State Colin Powell during his recent meeting with Pakistani Foreign Minister Abdul Sattar, Pakistan and the US have been close friends for over fifty years. In the fifties, Pakistan was the only country that belonged to both the CENTO and SEATO alliances formed by John Foster Dulles to contain the expansion of communism in Asia. It also had a bilateral military alliance with the US, and was provided substantial military hardware through the MAP programme to equip five-and-a-half infantry divisions and nine air force squadrons. In the eighties, Pakistan served as a frontline state during the Soviet-Afghan war in the eighties, and received $3.5 billion of military and economic assistance from the US. Supplies included 40 F-16 fighters, Cobra attack helicopters, M-48 A5 main battle tanks, heavy artillery and various infantry weapons including Stinger shoulder-launched SAMs.
In the aftermath of the Afghan war, Pakistan became the accidental home to more than three million Afghan refugees, many of them armed with AK-47 Kalashnikov rifles and engaged in narcotics trafficking. Some of these refugees, veteran mujahideen fighters of the Soviet war, banded together into militant Islamic groups committed to seeking the liberation of Kashmir from Indian rule. This has led some analysts to write about the rise of a jihadist culture in Pakistan.6 However, this analysis fails to recognize that a large portion of the educated middle class in Pakistan, and a major portion of the country’s intelligentsia, has been schooled in western educational institutions, both domestically and abroad. It supports cooperation with the west, and actively opposes confrontation. In addition, the Pakistani business community abjures violence and is interested in promoting economic growth.
On the diplomatic front, Pakistan finds itself currently at cross purposes with the US in three areas:
- The deposition of democratic rule with military rule, which took place in October 1999, and the recent ascendancy to the presidency by General Pervez Musharraf
- Allowing militant groups engaged in the Kashmir insurgency and connected with Osama bin Laden’s forces in Afghanistan to operate from Pakistani soil.
- Pakistan’s close military ties with China, including cooperation in the nuclear field, and the US interest in engaging India as the primary regional power in South Asia, partly with an eye to containing China.
The US National Intelligence Council (NIC), an arm of the US Central Intelligence Agency, has issued a report containing a grim assessment of Pakistan’s future in the year 2015:9
Pakistan will not recover easily from decades of political and economic mismanagement, divisive policies, lawlessness, corruption and ethnic friction. Nascent democratic reforms will produce little change in the face of opposition from an entrenched political elite and radical Islamic parties. Further domestic decline would benefit Islamic political activists, who may significantly increase their role in national politics and alter the makeup and cohesion of the military —once Pakistan’s most capable institution. In a climate of continuing domestic turmoil, the central government’s control probably will be reduced to the Punjabi heartland and the economic hub of Karachi.
One of the main reasons for Pakistan’s abysmal economic performance is poor governance and corruption in the administration, caused by the failure to develop robust political institutions and by decades of military rule. As much as a quarter of the $60 billion GNP may be lost to these twin problems, representing a total of some $15 billion.10 In a sample of 85 countries, Transparency International found that Pakistan in 1998 was more corrupt than 71 of the nations in the sample, with only Russia, Indonesia, Nigeria and some Latin American countries being more corrupt than Pakistan. India was ranked 66th.11
However, the NIC scenario is not the only future possible for Pakistan. In fact, it may be the low end of the range of possible futures. During the sixties, Pakistan enjoyed decisive political leadership under Field Marshal Ayub Khan and competent economic management. The primary shortcoming of Ayub’s rule was lack of democratic governance, which led to increased interpersonal and inter-provincial inequities in the distribution of income. Under enlightened leadership that uses the right set of policy instruments, Pakistan can once again attain that level of growth performance, without exacerbating income inequalities. There is a regional precedent, represented by the turnaround in India’s growth profile during the nineties.12
Generation of Scenarios
Pakistan’s future is predetermined to a degree by its demographics, its low levels of spending on human and social development over the past several decades, and by the need to pay off its staggering foreign and domestic debts. Additionally, Pakistan’s future is determined by developments in its external environment, many of which are beyond the control of Pakistan’s leaders. However, they can control how they respond to these developments. For example, they may or may not choose to match increases in India’s defence budget. Ultimately, they can control the country’s future evolution by resolving Pakistan’s myriad domestic problems. As stated in the Holy Quran, “God does not change the condition of a people until they change what is in themselves.”
One can presume that the ultimate goal of governance for a developing country is to maximize the welfare and economic wellbeing of its citizenry, so that poverty levels can be reduced, thereby bringing about political stability and social cohesion. Once that has been achieved, the nation would attract higher rates of domestic and foreign investment, both public and private. Higher investments would bring about higher growth in economic output, further lowering poverty levels. Of course, the opposite would occur if government policies reduce economic growth, raise poverty levels and exacerbate political and social tensions.
In the case of Pakistan, the following factors are likely to influence its future development.13
- External Environment. A multitude of factors shape Pakistan’s external environment. India’s economic, political and military evolution will have a major bearing on Pakistan’s development. India’s likely transformation into a regional power, with significant capabilities to project military power throughout the Indian Ocean littoral, will likely earn it a permanent seat on the UN Security Council. This development may trigger defensive reflexes in Pakistan, leading to an arms race that Pakistan can ill afford at this nascent stage of its economic development. India’s policy toward Pakistan and Kashmir may make it easier or more difficult for Pakistan to accept Indian hegemony in South Asia.14 If a Pakistani-backed insurgency continues in Kashmir, it will almost certainly trigger a countervailing Indian-insurgency in Sindh and Balochistan. Developments in Afghanistan, such as the consolidation of the Taliban government, with its restrictive human rights policies, may trigger a further influx of refugees into the provinces of Balochistan and Frontier. Developments in Iran may stabilize or destabilize Pakistan, depending on whether they lead to a moderation of the civil war in Afghanistan. A new crop of Iranian leaders may cool some of the revolutionary fervour of the hardline factions in the clergy. On the other hand, Iran may see a re-emergence of a strong clergy that seeks to impose the Shia-brand of Islam throughout the Muslim world. Chinese economic growth and political and military evolution will have a major influence on Pakistan’s military and economic development. Having contributed to the development of Pakistan’s conventional and nuclear military capabilities, China may well proceed with construction of a deep-water port at the strategic Pakistani port of Gwadar, located near the entrance to the Strait of Hormuz. China’s competition with Taiwan, if it triggers further supply of armaments from the US, may move China even closer to Pakistan. The evolution of the Shanghai Cooperative Organization may impede or promote Pakistan’s ties with China, the Central Asian republics, and Russia. Insurgencies in China’s western provinces, trouble in Tibet, and continued economic growth along the eastern seaboard could lead to the break up of China. On the other hand, continued economic growth in the eight to ten percent range, coupled with the departure of Mao’s Long March comrades from the leadership could lead to the ultimate collapse of communism in China, and its replacement with Russian-style democracy. The economic, political and military evolution of the Middle Eastern countries may stimulate or contract demand for Pakistani labour, thereby spurring or decreasing foreign remittances into Pakistan. Another Gulf war would lead to further tensions in Pakistan. The rate of world economic growth will impact Pakistani economic growth, by influencing the rate of growth of Pakistan’s exports.
- Quality of Governance. More than any other factor, the quality of governance will have a significant impact on Pakistan’s future prospects. Bold and decisive leadership that can make the hard choices between consumption and investment; and between spending on defence and spending on human and economic development; will make a significant difference. Leadership that shows integrity in its personal and public dealings, and that can institute policies to minimize corruption, will make a difference.
- Political Policy. This concerns the vital issue of civil-military relations, and the determination of the domestic political order. For example, will the people have the right to self-government, or will they be subjected to authoritarian regimes that rule by decree? Will there be a concentration of power in the personality of the chief executive, or will power be evenly distributed between the executive, legislature and judiciary. Will there be term limits on the Chief Executive? How will centre-provincial relations evolve? Will the dominance of the Punjab in Pakistani decision making diminish or increase with time?
- Social Policy. This concerns the management of ethnic and sectarian divisions within the body politic. Wise government policies will heal these divisions, and divisive policies will add to them.
- Diplomatic Policy. This concerns the management of relations with allies as well as the management of relations with traditional enemies. Depending on how it is carried out, successful diplomacy can bring much needed foreign aid to Pakistan, perhaps even lead to the retirement of some debt, and may well lead to a peaceful resolution of long-standing disputes with India. It may help bring about reconciliation between the warring tribes of Afghanistan, and transform the Taliban’s Islamic zeal into more constructive channels.
- Military Policy. This comprises the pursuit of strategic objectives by military means. The right policy will lead to the development of a professional army that pursues realistic goals that are within the means of the country. Promotions will be based on merit and not loyalty. Operations will be characterized by true jointness, and inter-service rivalries will not lead to fiscal excesses and turf wars. There would be transparency in fiscal matters, civilian oversight over military spending, and improvements in the efficiency of military spending.
- Economic Policy. This comprises the mix of fiscal (tax and spending), monetary (growth in money supply and interest rates), international trade (exchange rates, tariffs and quotas) and institutional (liberalization of markets) policies. The ideal set of policies would lead to speedy retirement of existing debt, the accumulation of foreign exchange reserves, rapid but sustained economic growth, reduction in income inequalities, and reduction in poverty levels. They would also lead to improvements in the nation’s physical and social infrastructure (roads, rail, and air communication; energy services; water services; public health; education.
Scenarios
- Super High Performance. Pakistan will resemble the best features of the “East Asian” miracle. The scenario will be characterized by GNP growth at eight to nine percent a year, allowing per capita income to rise by five to six percent a year. Poverty levels will decline to less than 15% of the population. This scenario might sound Utopian, given Pakistan’s recent history. However, it is within the realm of possibilities. Pakistan’s military has finally recognized that economic progress holds the key to the nation’s future. In a recent speech, President General Pervez Musharraf noted that while Pakistan has military muscle and is a nuclear power, it does not have matching economic strength and is thus a weak state. “We have to strengthen our economy in order to create a balance with our military power.”15 This scenario is likely to occur if the following conditions prevail: a high investment rate in the range of 35-40% of GNP; fiscal surplus of two percent of GNP, brought about by expansion of the tax base and reduction in unproductive government expenditures; low levels of foreign debt; a liberalized economic system with significant incentives for private enterprise and a modicum of red tape; a booming IT sector; inspired political leadership and governance; institutions of checks and balances between the three branches of government; democratic rule; domestic harmony; a foreign policy focused on cooperation and peace; defence spending at 2% of GDP; conversion of SAARC into a free trade area; extensive economic trade and commerce between Pakistan and India.16
- High Performance. Pakistan in 2015 will resemble the Pakistan of the early sixties when Pakistan seemed primed to hit the “take off” stage and evolve into a middle income power. The scenario will be characterized by GNP growth at six to seven percent a year, allowing per capita income to grow by three to four percent a year. Poverty levels around 25%. This scenario is likely to occur if the following conditions prevail: an investment rate in the range of 25%; diminished income inequalities and regional disparities; foreign policy moving toward cooperation and peace, with occasional interludes of conflict with neighbouring powers; defence spending at 4% of GNP; civilian government control; well developed physical and social infrastructure.
- Medium Performance. Pakistan in 2015 will resemble the Pakistan of the eighties. The scenario will be characterized by GNP growth at four to five percent a year, allowing per capita income to grow by one to two percent a year. Poverty levels will range from 45% to 55%. This scenario is likely to occur if the following conditions prevail: investment rates in the range of 20%; stabilization of macroeconomic imbalances; national security would continue to be equated with military muscle; a confrontational foreign policy with India would continue; there would be tacit support to militant groups in neighbouring countries; involvement in Afghanistan would continue with a desire to seek strategic depth; military rule; and defence spending at 6% of GNP.
- Low Performance. Pakistan in 2015 will resemble the Pakistan of the fifties and nineties. There will be anemic growth in GNP of three to four percent a year, and per capita incomes will stagnate. Poverty levels will be in excess of 65%. This scenario is likely if the following conditions prevail: investment rates in the range of 15%; deterioration in macroeconomic imbalances; governments that lack the will to make tough decisions; rent seeking behaviour by oligarchs (feudal lords and civil service); recidivous militarism; adventurism in foreign policy; defence spending at 8% of GDP; heightened inequalities in income distribution; civil discord; inter-provincial rivalries; intolerant religiosity; breakdown of law and order; institutional meltdown17; soaring foreign debt, leading to bankruptcy; government unable to pay salaries to government workers; erosion of national sovereignty.
- Super Low Performance. Pakistan would resemble today’s Afghanistan, Sudan or most of sub-Saharan Africa. There would be zero growth in GNP, and per capita incomes would decrease by three percent a year. Poverty levels will be in excess of 80%, and public services will become dysfunctional. The military will disintegrate into rival militias, each headed by a warlord. There will be no semblance of law and order in either urban or rural areas. Special interest groups bring the political decision making to a halt. Leaders of tribes, clans, and sects will demand absolute loyalty. And there will be extreme inequalities of income. This scenario will be likely if the following conditions prevail: investment rate under 10%; macroeconomic imbalances in excess of 10% of GNP; high population growth; rising levels of illiteracy; no respect for minorities and women.
The scenarios described in the previous section can be thought of as resulting from a smooth evolution of events between now and the year 2015. In addition, there is a significant probability that any of the scenarios can degenerate into a sudden crisis. Such a possibility can occur in any scenario, but is particularly strong in Scenarios 4 and 5. Disruptive events that can precipitate a crisis include:
- Osama bin Laden’s followers carry out a daring raid at the Sargodha airbase in the Punjab province, and seize several M-11 short-range ballistic missiles. The missiles are taken to Afghanistan, and can be used to threaten neighbouring states in Central Asia as well as Pakistan. Two Pathan Pakistani air force officers defect to Afghanistan with advanced air force fighters laden with nuclear-tipped air to ground missiles.
- Osama Bin Laden succeeds Mullah Omar as the next ruler of Afghanistan. Soon, thereafter, the Government of Pakistan is overthrown by a Taliban-style militia. All senior government leaders are executed in a manner reminiscent of the Ayatollah Khomeini’s takeover in Iran. Osama’s forces gain access to Pakistan’s nuclear weapons, and consummate a confederation between Afghanistan and Pakistan.
- The existing ex-communist leadership in the Central Asian republics has died off, and is replaced by a new crop of leaders who have no allegiance to Moscow or China. This is accompanied by bombs and explosions in Chechnya and Xinjiang. China steps up its anti-terrorist campaign, and executes several Muslim leaders accused in Xinjiang. Two of the Central Asian republics pull out of the Shanghai Cooperation Organization, and create a new organization that includes Afghanistan. They demand that Pakistan break its ties with China and join this organization, and threaten retaliation if it does not comply.
- India’s military expansion causes all of its neighbours to band together, forming a Waltzian ring around her. Pakistan exploits the situation to step up the Kashmir insurgency. India responds by blockading the port of Karachi. Submarines of the Chinese navy, based in the western Pakistani port of Gwadar, sink the leading Indian aircraft carrier to break the blockade. India responds by invading Pakistan, leading to a full-scale war between the two nuclear powers.
- Violence in Kashmir flares up, leading to a full-scale war with India. Threatened with an Indian invasion, Pakistan launches tactical nuclear weapons against Indian forces. India retaliates and takes out all major Pakistani cities.
- Inter-provincial disputes in Pakistan over the allocation of increasingly scarce water and energy resources spin out of control. The provincial distribution of federal expenditures is questioned. The smaller provinces ask their citizens to stop paying taxes to the federal government. Balochi insurgents take over the Sui Gas fields, stopping the flow of gas into the rest of Pakistan. Navy personnel in the port of Gwadar come under mortar attacks, and a senior Chinese officer deployed there is kidnapped and held hostage. The Pakistani military seeks to restore the writ of the federal government in the smaller provinces, but is easily overwhelmed by defections, reminiscent of the Bangladesh crisis of 1971. With Indian encouragement, Sindh becomes an independent state. Balochistan and Frontier merge with Iran and Afghanistan respectively, with encouragement from these two countries.
US Policy Alternatives
US strategy in the year 2015 is likely to include a wide range of objectives20, including:
- Promoting world economic prosperity
- Preventing the outbreak of infectious diseases
- Husbanding environmental resources
- Ensuring access to world energy supplies
- Encouraging efficient use of energy
- Encouraging democratic institutions
- Safeguarding human rights, especially the rights of ethnic minorities and women
- Preventing the proliferation of weapons of mass destruction
- Restraining transnational terrorism
- Halting drug trafficking, money laundering and gun running
- Preventing pervasive corruption in governance
- Preventing uncontrolled refugee migration between countries
Table 1: Matrix of US Policy Options
1.Diplomatic Policy
Positive Measures
Initiate confidence-building measures between India and Pakistan. Mediation between India and Pakistan. Organize UN initiative(s) in Kashmir. Encourage democracy in Pakistan. Social, cultural and educational exchanges.
Negative Measures
Isolation campaign Rogue-state designation
Economic Policy
Positive Measures
Foreign aid at concessional terms.
Nigerian-style debt write off.
Credit guarantees (OPIC, EXIM, CCC).
World Bank/IMF sponsored aid package.
Science and technology promotion programme
Negative Measures
Embargo on international trade
Military Policy
Positive Measures
Joint exercises in Pakistani waters, air space and land.
Exchange of senior officers.
Training programme for all ranks.
Arms sales.
Assistance in defence production. Bases on Pakistani soil.
Negative Measures
Evacuation of US personnel
Panama/Grenada type mission
Blockade of ports
Iraq-type no fly zones
Cruise missile attacks
Kosovo-type air war
Full-scale ground war
It will be important for the US to engage proactively with Pakistan across the five scenarios described earlier, even though the specific portfolio of policy instruments chosen will vary by scenario.21 Pakistan in the year 2015 will most likely be the largest Muslim country in the world, and by then Islam will have become the second largest religion in the US. There will be a sizeable Pakistani Diaspora in the US, making a strong contribution to the productivity of the US economy. First and second generation Pakistani-American entrepreneurs will establish and manage high-tech companies that employ hundreds of people. Consistent with past practice, Pakistani-American doctors and engineers will occupy leadership positions in their profession. They will diversify into other professions as well, such as journalism, law and economics. On the political front, Pakistani Americans are likely to be represented in many state legislatures; a few may be sitting in the US House of Representatives; and one or two may have contested a senatorial position. They are also likely to be represented in one or more senior positions in the US government.
Pakistan will have a sizeable inventory of nuclear warheads, upwards of 50 warheads. It will be capable of delivering them from air, land and sea based platforms. Fuel for the warheads will come from an expanded programme of nuclear power generation. This programme would be an outgrowth of the 300 MW Chinese-built Chashma nuclear power station that became operational in 2000. Pakistan is also likely to have attained self-sufficiency in a variety of conventional defence systems, and is likely to be a major arms exporter to states in the Gulf region, Southeast Asia and Africa. Likely weapon systems will include submarines (derivatives of the French Agosta class), main battle tanks (derivatives of the Al-Khalid class), and armoured personnel carriers (derivatives of the US M-113).
Its geographic location would have become more salient, with the further development of the energy resources in the Central Asian republics. As these economies grow, they will seek access to the Arabian Sea, and Pakistan may well become the ideal means of transportation for them.
The first two scenarios, featuring Super High Performance and High Performance, will require the US to support Pakistan’s continued economic, political and social development by providing diplomatic and economic incentives. In addition, the US military should be engaged constructively with the Pakistani military, through exchange of senior military officers, military training programmes, and through joint exercises.
The third scenario, Average Performance, will require the US to pursue an expanded set of diplomatic and economic options to encourage economic growth and prevent a drift toward the sluggish performance of the nineties.
The fourth scenario, Low Performance, will require an economic “SWAT team” where the US sends in economic advisors to help the Government of Pakistan salvage its bankrupt economy, and arranges for writing-off a major portion of its foreign debt. In addition, on Pakistan’s request, it may arrange for the creation of a UN sponsored peacekeeping force that would restore law and order.
The fifth scenario, Ultra Low Performance, is clearly the most dangerous of the five considered in this paper. It will require the most nuanced approach on the part of the US. Extreme care will need to be observed to ensure that outright hostility does not develop between the US and Pakistan, as the former tries to insert itself by force into the Pakistani state, in order to prevent Balkanization of the latter, and in order to prevent nuclear weapons from falling into the hands of war Lords. It will be counter productive to label Pakistan a rogue state, since the current policy of labeling nations such as Iran, Libya and Sudan as rogue states has not worked either. It would be wise to avoid US military intervention, since that will further polarize an already difficult and messy situation. It may draw China and Russia into the conflict, precipitating a much larger and potentially very dangerous continental crisis. Indian forces will have to be restrained from entering Pakistan and installing a puppet regime. It would be best to create a peacemaking force under UN auspices. This would of course require the cooperation of China and Russia. Once the semblance of a functioning government has been ensured, emergency economic aid would have to be provided to resuscitate the dysfunctional economy and meet the basic needs of the population.
END NOTES
- International Institute for Strategic Studies, Military Balance, various years, London.
- Government of Pakistan, Economic Survey 2000/2001, Ministry of Finance, Islamabad, Pakistan and Pakistan, Government of Pakistan, “SBP Quarterly Report”, State Bank of Pakistan, Karachi, Pakistan.
- World Bank, World Bank Atlas 2001, Washington, DC.
- IRNA, Islamabad, June 19, 2001.
- Ahmad Faruqui, “Failure in Command: Lessons from Pakistan’s Indian Wars,” Defence Analysis, Winter 2001.
- Jessica Stern, “Pakistan’s Jihadist Culture,” Foreign Affairs, xxxx, 2000.
- Ehsan Ahrari, “Transnational Terrorism, Pakistan, and the U.S.,” Strategic Review, Winter 2001, pp. 11-17.
- Ehsan Ahrari. “Strategic Moves in Southern Asia,” The 5th Column, Far Eastern Economic Review, June 28, 2001.
- U.S. Central Intelligence Agency, Global Trends 2015: A Dialogue About the Future With Non-government Experts, NIC 2000-02, December 2000, Washington, DC.
- A cabinet-level study done by Shahid Javed Burki and Hafeez Pasha in 1996-97, cited in Burki, p. 174. For the role of countervailing action by the losers in exposing corruption, and thus preventing its expansion, see M. Shahid Alam, “Corruption and Countervailing Action in Pakistan,” in Silvio Borner and Martin Paldam (editors), The Political Dimensions of Economic Growth, Macmillan, 1998.
- Cited in Vito Tanzi, “Corruption Around the World: Causes, Consequences, Scope and Cures,” IMF Staff Papers, December 1998.
- Burki, Shahid Javed, “Pakistan 25 Years from Now,” Pakistan Link, May 25, 2001.
- Hughes, Barry B. International Futures: Choices in the Creation of a New World Order. Westview Press, 1996.
- Faruqui, Ahmad, “Beyond Strategic Myopia in South Asia,” Strategic Review, Winter 2001, pp. 18-25.
- Address to the 25th National Seerat Conference at Islamabad, located at www.pak.gov.pk/public/chief/CE_Seert-Conf.htm
- Looney, Robert E. “Pakistani defence expenditures and the macroeconomy: alternative strategies to the year 2000,” Contemporary South Asia, 4(3), 1995, pp. 331-356.
- Robert D. Kaplan, “The Lawless Frontier,” The Atlantic Monthly, September 2000, pp. 66-80.
- Jeffrey D. Sachs, “The Strategic Significance of Global Inequality,” The Washington Quarterly, Summer 2001, 24:3, pp. 187-198.
- Bradd C. Hayes, International Game ‘99: Crisis in South Asia, 28-30 January 1999, United States Naval War College.
- United States Government. A National Security Strategy for a New Century. The White House, December 1999.
- Stephen P. Cohen, “Moving Forward in South Asia,” Policy Brief No. 81, Brookings Institution, May 2001.
