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BRIEF HISTORY OF PAKISTAN’S ECONOMY
1947-1960
In 1947 Pakistan was predominantly agrarian, underdeveloped,
newly independent nation with little industry, few services and
marginal infrastructure. In the first few years Pakistan’s main
concern was one of survival, because without any developed sector
the new state had to manage million of refugees and start building
the economic sector. The first decade of economic policy and
planning witnessed the attempts of bureaucracy to keep Pakistan on
its feet. The task of building an economic base was left to the
state sector as the private sector was still in embryo and did not
have the capital to lead an industrial revolution in the country.
1960-1970
The decade of 1960s has been termed a “controversial decade”
for the type of economic policy pursued and the resulting economic
and social effects. Significant progress was made in industrial and
agricultural production, where growth rates in excess of 20% per
year were witnessed in the large scale manufacturing sector.
However, observer have pointed out that this aggressive capitalist
development caused serious economic, social and political tension
due to disparity of incomes across different regions. This was
manifested in the concentration of economic prosperity in central
Punjab and Karachi. There was also economic concentration among
individuals and a number of business empires were created which
resulted increased income inequality. Functional inequality was the
preferred philosophy of Harvard advisory group lead by Ayub khan
and Mahbub- ul Haq and its focus was on the rich, who were supposed
to generate more savings, and thus were to be the motors of
capitalist growth. It was capitalism, and the private sector did
play a significant role, but it was a guided, bureaucratically
governed and directed capitalism. The bureaucracy played an active
role in the establishment of private sector capital in Pakistan.
Bilal Ahmad
Islamabad.
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