PAKISTAN: Economy waiting for boost from election result.
Updated
The Pakistan government has mobilised tens of thousands of troops around the country in the lead up to next week's election. The vote has been delayed by more than a month because of the assassination of opposition leader Benazir Bhutto in December. Many commentators say Pakistan's economy is also on delay, held back by the policies of the military rule of President Pervez Musharraf. The sense of crisis and uncertainty of the recent past has done little to alter their view, which some say only a change of government can improve.
Presenter: Karon Snowdon
Speakers: Economist Kaiser Bengali, Collective for Social Science Research in Karachi; political analyst Talat Masood
SNOWDON: Pakistan's 165 million people are facing a time of uncertainty.
But the domestic economy has been doing well, even booming in some areas.
Property values have skyrocketed in the cities, the stock market has been one of the best performers in Asia, consumer spending on items like cars is high.
But 70 per cent of Pakistan's population lives in villages, where poverty, unemployment and more recently food shortages paint a very different picture.
BENGALI: There certainly is a sense of crisis that's very real.
SNOWDON: Economist Kaiser Bengali from the Collective for Social Science Research in Karachi, says most of Pakistan's growth has been limited to the financial sector. While President Musharraf and his former finance minister can be credited with opening up of the economy and multiplying foreign investment into several billion dollars, Kaiser Bengali says it's mostly benefited the lucky ones living in the urban growth centres.
BENGALI: There has been a very unfair distribution of benefits and burdens. This is true of most of the policies the government has followed in the last decade. Inflation tripled over the last four years and the cost of inflation has been borne by those who were not eligible to get any bank facility, the poor.
SNOWDON: Food prices jumped by 18 per cent in January. Recent opinion polls illustrate the importance of home economics to most Pakistanis, with around 50 per cent nominating inflation as the issue most likely to influence how they vote in next week's election. Poverty and unemployment ranked second and third.
Political analyst Talat Masood says Benazir Bhutto's party the PPP, with its campaign mantra of poverty reduction stands to gain from the general mood.
MASOOD: I would say it's not so much sympathy vote as it is there is a great strong resentment against the present regime and that is more helpful than the sympathy vote.
SNOWDON: Pakistan's military accounts for about seven per cent of GDP, education and health spending just 3 per cent. Almost all of the 10 billion dollars in Coalition support funds poured into Pakistan since 2002 has gone to the military. Kaiser Bengali has a list of things that need to be done.
BENGALI: We need to have growth which is investment-based rather than consumer demand driven. We need to have investment in hard sectors like commodity producing sectors like agriculture and industry, manufacturing. We need to increase the productivity of our agriculture which has been stagnant for almost 20 years. We need to invest in better water management, we need to provide industrial infrastructure which is creaking, there is no power in the country, in the last eight years not one single megawatt of power capacity has been added. So there has to be a move away from being satisfied with financial statistics, I think we need to invest heavily in housing.
SNOWDON: Perhaps it's a hope against hope but if the elections are fair and a popular government emerges, uncertainty could turn to optimism for Pakistan's economy as well as its democracy.
BENGALI: I know we have been in sort of communication with the political parties, they are quite aware of the problems and I think the policy shift that needs to be made to make economy more stable and have it grow in a more sustainable manner.
