Transacting a war economy

Soon after independence this young nation had to face immense problems. In the realm of political economy and in putting a constitutional system in place took some considerable time and a great deal of effort was made in this regard. Also, the 1979 Russian invasion of Afghanistan got the country muddled in a superpower war, seriously upsetting the normal route to economic progress.
The strain of the war effort was so great on the Soviet Union that a decade later its economy could no longer afford the war. The opening of the system, perestroika, began without accompanied reforms that were essential for such a move to succeed. The marketplace economy functions best when sound, transparent and coordinating mechanisms of governance are put in place. As if the spillover of the decade of Afghan war in the eighties was not enough for Pakistan to deal with, the US decided to repeat the blunder. The lessons learnt in the Vietnam fiasco had, probably, faded and the euphoria of an apparent victory of the cold war led to an invasion of Afghanistan.
Let us not forget that for centuries the area that is Pakistan has been a place of continuous struggle for many forces. The Muslim rulers of the sub-continent had little difficulty in tackling the back regions they had come from. It was later and with the coming of the British rule that an international dimension was added to this conundrum and so it stays till today. The Afghan policies in the nineteenth century led to some terrible wars.
The economy of Pakistan was put under terrible strain during the period of this violent conflict in the neighbouring country. Afghanistan is landlocked and its major trade is through Pakistan. It puts special pressure on its ports and the infrastructure used for making supply routes viable. In addition to that large quantity of eatables like cooking oil, flour and many other items are imported from Pakistan or smuggled. Due to a burgeoning population here the economy is already under pressure. Since last year the devastating floods have wreaked havoc with the crops and the economy. As the All Parties Conference held in Islamabad last week has highlighted the sacrifices in human cost have been quite high in this continuing war on terrorism.
There are some genuine concerns about addressing terrorism related issues. The aftermath of the so-called and planned withdrawal of the US forces from Afghanistan is going to put further strain on Pakistan’s economy. Most heads of the major political parties were present in the conference but there are many other stakeholders whose participation can bring some remarkable success. A transparent but really comprehensive plan is required to get us out of this morass. All states have to face challenges in their task of nation building and Pakistan is no exception. It is true that that the country is placed in an unusually turbulent region of the world. But keeping the world perspective in view, Pakistan can easily attain an effective voice in the global sphere if a diplomatic and truly motivated effort is launched by uniting indigenous economic, political, business and security circles on one platform.

The writer has served as consultant to the United Nations and other developing economies on the issues of trade and development and can be reached at [email protected]