Recommendation: poverty reduction be made part of anti-terror strategy: SPDC launches annual review report

The Social Policy and Development Centre (SPDC), in its Annual Review 2009-10 recommended that the national goal of poverty reduction should be considered an essential element of the anti-terror strategy. The SPDC's 10th report for this series launched here on Saturday with the theme identified for this year "Social Impact of the Security Crisis" also said that only the use of force through army operations cannot provide long lasting peace in the country.
The report presents several elements of a solution. It says that there is a need for consensus based national strategy that aims both at preventing terrorism and minimising its effects on social development. The SPDC Managing Director, Khalida Ghous and Principal Economist Muhammad Asif Iqbal spoke on the findings of the report. Former federal minister Javed Jabbar also gave his remarks on the annual review.
The report said that political developments in the region have caused a change in the internal political and security dynamics of Pakistan with implications for its social and economic development. This issue is comprehensively addressed by the Social Policy and Development Centre in its Annual Review of Social Development in Pakistan, 2009-10 on "Social Impact of the Security Crisis."
The report explores various facets of the existing security crisis confronted by the government and society and its implications for socio-economic development in Pakistan. Systemic failure both of institutions and social development policies initiated by respective governments and its role in breeding violence and extremism are equally responsible for the crisis.
The report highlights that costs of participation in the war on terror have risen exponentially with the dislocation of economic activity, high losses of life and property, and impact on the investment climate. In 2009-10, cost to the economy due to fall in investment and stock market capitalisation was Rs 367 billion. Overall, the total costs of participation in the war on terror have increased from Rs 380 billion in 2007-08 to Rs 840 billion in 2009-10. The report highlights that costs of war are over three times greater than the bilateral assistance forthcoming, especially from the United States.
The security crisis has also fiscal implications in terms of budgetary priorities of both federal and provincial governments. Analysis of the trends in federal and provincial expenditures show an extraordinary growth in expenditures on public order and safety during the 2000s. Security related expenditures have increased from Rs 177 billion in 2000-01 to Rs 800 billion in 2010-11. The sector-wise analysis of government expenditures shows that resources have been shifted away from economic sectors such as water and power, and social sectors such as education and health.
The analysis presented in the report shows that the pace of social development has slowed down. Incidence of poverty has increased from 30 percent in 2004-05 to 38 percent in 2007-08. There also appears stagnation in the indicators of education and health sectors and Pakistan is unlikely to meet most targets of MDGs by 2015.
The report analyses the impact of security crisis on the provincial economy of Khyber Pakhtunkhwa where escalation of the armed conflicts has had repercussions on the lives and livelihoods of, and provision of normal public services to the local population. Agricultural sector in Khyber Pakhtunkhwa, which suffered because of the 2005 earthquake, shows major decline which can be partially attributed to the increase in militancy and the military operations carried out in the province. Similarly, manufacturing production has either declined or slowed down. As a result, the growth and pattern of employment have also been adversely affected. In 2008-09, youth unemployment rate in Khyber Pakhtunkhwa was estimated to be 11.6 percent as compared to the national average of 7.5 percent.
Similarly, unemployment rate for female graduates have substantially increased from 24 percent in 2005-06 to 36 percent in 2008-09. The impact of conflict on socio-economic status of households has been analysed in the report through a survey conducted in selected districts of Khyber Pakhtukhwa (Peshawar, Hangu, Bannu, Tank and Swat).
A comparative analysis of poverty incidence in these areas before and after the security crises shows an increase in the poverty incidence, which is now 55.8 percent. The report also highlights that economic difficulties and insecurity are the two main reasons for not sending children to schools. Psychological distress and anxiety about the current economic and security situation is also widely prevalent. The survey reveals that 67 percent of the heads of households may be considered as having significant psychological distress and 'potential psychiatric cases' as per the definition of WHO.
The report observes that while the state has relied on short-term offensives against militants, civil society is more involved with providing social development services and supporting peace and harmony. Though there is no single and collective strategy, the civil society by and large, has demonstrated a commitment to continuing its work even in severely affected areas.
However, the need for state and society to come together, recognise the issues, accept each other's roles and come to a shared vision of what needs to be done to get out of the quagmire of terror is emphasised. The report presents several elements of a solution. There is a need for consensus based national strategy that aims both at preventing terrorism and minimising its effects on social development. The report recommends that the national goal of poverty reduction should be considered an essential element of the anti-terror strategy. On the whole, the report concludes that use of force through army operations only cannot provide long lasting peace in the country.