Pakistan pays heavy price in war on terror, suffers around $67.93bn
A large portion of resources, both men and material are being consumed by this war for the last several years and the economy was subjected to enormous direct and indirect costs which continued to rise from $2.669 billion in 2001-02 to $13.6 billion by 2009-10.
As per data available with APP, this cost is projected to rise to $ 17.82 billion during this year and is most likely to rise further.
The cost of war estimate during this year included exports 2.90 billion Dollar, compensation to victims 0.80 billion Dollar, physical infrastructure 1.72 billion Dollar, foreign investment 2.10 billion Dollar, privatization 1.10 billion Dollar, industrial output 1.70 billion Dollar, tax collection 2.10 billion Dollar, cost of uncertainty 2.90 billion Dollar, expenditure overrun 1.60 billion Dollar and others 0.90 billion Dollar.
Since 2006, the war has spread like a contagion into settled areas of Pakistan that has so far cost the country more than 35,000 citizens, 3500 security personnel, destruction of infrastructure, internal migration of millions of people from parts of north-western Pakistan, erosions of investment climate, nose-diving of production and growing unemployment and above all brought economic activity to a virtual standstill in many part of the country.
When contacted official sources on Wednesday said Pakistan had never witnessed such a devastating social and economic upheaval in its industry.
The sources said as a result of war in Afghanistan the western countries including the United States continued to impose travel ban for their citizen (investor, importers etc.) to visit Pakistan.
This affected Pakistan's exports, prevented the inflows of foreign investment, affected the pace of privatization programme, reduced import demand, reduced tax collection and expenditure over-run on additional security spending.
Domestic tourism industry also suffered badly, hundreds and thousands of jobs could have been created had economic activity not slowed as well as thousands of jobs were lost because of the destruction of tourism industry.
Investment-to-GDP ratio has also nosedived from 22.5 percent in 2006-07 to 13.4 percent in 2010-11 with serious consequences for job creating ability of the economy.
Going forward, Pakistan needs enormous resources to enhance productive capacity of the economy. The security situation will be the key determinant of the future flow of the investment.
Pakistan became more insecure in its efforts to make the world a safer place to live. This war has not only caused serious damage to the economy but also to the social fabrics. Obviously, continuity of war will continue to bleed the economy and society of Pakistan.
Copyright APP (Associated Press of Pakistan), 2011