A reality check on Vision 2025

A reality check on Vision 2025

In a recent meeting of the National Economic Council, Prime Minister Nawaz Sharif approved the ‘Pakistan Vision 2025’ plan, which proposes optimal utilization of country’s resources to achieve sustainable progress like developed nations.
The development strategy is based on seven pillars that include investment in human and social capital, focus on inclusive growth, improved governance and reformation of public sector, and forging greater private-public partnership.
Under the vision plan, Pakistan will transform itself into a knowledge-based economy through value addition and modernization of the country’s infrastructure. The government has also announced framework for 11th Five Year Plan within the scope of Vision 2025. While the government has hailed the Vision 2025 as a blue print for long-term development of the country, it suffers from several shortcomings in reality. It seems more like a wish list rather than being based on effective planning and analysis of situation on ground. For instance, the government has pledged to optimize its energy generation mix, tap alternative energy sources and complete the construction of large hydroelectric and coal-based projects. Additional steps regarding energy conservation, demand management and reducing transmission losses are also expected to narrow the electricity’s supply-demand gap. Before envisioning more ambitious projects, the government should focus on improving management of existing initiatives to fully utilize their power generation potential. It must prioritize efforts to revive recently launched projects like the Guddu Thermal Power Station, Nandipur Power Plant and strategically important Diamer Bhasha dam.
Similarly, it is difficult to imagine a complete transformation of Pakistan’s labor-intensive economy into a knowledge-based one. Such economic miracles do not happen overnight, but concrete steps need to be made in that direction. Higher allocation of public funds toward education and development spending remain key ingredients for economic transformation of any country. Pakistan has allocated a mere 5 percent of total public sector development spending (PSDP) on education in 2014-15, down from 6 percent compared to the previous year. In such a scenario, the development of human and social capital cannot be possible and large sections of the society will remain marginalized.
By allocating only 1 percent of PSDP toward science and technology, the government should not expect breakthrough innovation, improvements in productivity and innovation that propel the country’s economy. The Vision 2025 forecasts Pakistan to achieve an export target of USD 150 billion within a decade through focus on value addition and diversification of products, and markets. Unfortunately, actual figures show that Pakistan’s exports have remained sluggish during 2014 and are not expected to grow significantly in the coming years. The country’s perilous security situation, energy crisis and faulty exchange rate regime have combined to stifle exports growth. Owing to these factors, Pakistan’s GSP Plus status in European markets can be counted as a missed opportunity.
Considering the existing political challenges faced by Sharif and shaky democratic process in the country, ownership of the rather flawed Vision 2025 is another major concern. The question is will future political setups continue to work on this plan to make it a reality, in case of any change of guard at the center? Each successive government in Pakistan has historically made a U-turn from its predecessor’s policies. If this trend prevails, then the Vision 2025 will fail to translate into action.
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