Pakistan economy needs to grow 7-9pc to generate jobs, curb debt: Report

Pakistan's economy needs to grow at a rate of 7 to 9 percent for three decades in order to generate employment opportunities and curb government debt.

This was revealed by the Pakistan Institute of Development Economics (PIDE) in its latest report titled Reforms for Accelerated Prosperity and Inclusive Development (RAPID).

“The 7-9pc growth rate is not the projected rate rather it is the rate required to stay out of the woods and two, moving to a high and sustainable growth trajectory calls for breaking away from the past which is possible only if we undertake deep-seated structural reforms in almost all areas influencing growth,” stated the report.

The report highlighted that investment and productivity, which are the two major drivers of growth are not only rather low in Pakistan, but are on a decline. “The challenge then is to significantly raise the investment rate and productivity.”

The report said that its research has found that state of institutions is a key determinant of the growth of any nation. Realizing, the resource constraints that the country face this reform agenda emphasizes reforming institutions (laws, rules, procedures and, processes) to raise productivity and investment.

Thus the focus is on altering the software of growth to improve the productivity of public as well as private investment.

The report stated that addressing restrictive regulatory regime and procedural bottlenecks that the investors face will not only improve the productivity of private investment but will increase its magnitude as well.

The agenda recommends using the Result Based Management Framework (RBM) to identify projects suitable for public investment, monitoring implementation, and assessment of outcomes.

Furthermore, in order to end the monopoly of political families, it is necessary for an individual to be barred from becoming a Member of Parliament and Prime Minister more than twice, the report said, to ensure stable democracy in the country.

“There should be a maximum term limit (maybe two terms) for the Prime Minister and all the legislators. The Mayor of the local government should be directly elected,” it said.

The report also called for developing cities, which are believed to be the engine of economic growth. “This is an environment conducive to innovation, which is so crucial to economic growth. The current regulatory framework does not allow the emergence of such cities. The reform agenda recommends rethinking the regulatory environment surrounding city zoning, construction regulations, car- use, public spaces, and so on to unleash such cities that facilitate economic activity to their fullest,” it stated.