Pakistan’s Theory for Economic Development: Infrastructure, Infrastructure, Infrastructure

Pakistan, for most of its contemporary history, has heavily focused on the role of transportation and energy infrastructure, and largely ignored the roles of other theories of economic development. Pakistan’s favorite economic theory, infrastructure-based development, follows in the footsteps of China, Singapore, South Korea and Indonesia. Democratic government after government has pursued infrastructure projects to modernize and develop Pakistan. However, this strategy is bound to face road blocks if other aspects of this development theory are ignored, as well as other economic literature regarding the subject of development.

Take into account, the role of education, and the current education statistics in Pakistan. Pakistan’s youth, between the ages of 15-24, are lagging behind their counterparts in much of South Asia. The literacy rate for men, within this youth category, is 79.1%. The rate for women is almost 20 points lower, standing at 61.5%.  This should be an alarming situation to the nations leaders who are investing solely in the nations infrastructure with heavy Chinese loans. The official CPEC website highlights four major areas of investment projects: transportation infrastructure, energy, the port of Gwadar, and industrial cooperation. 

There is no mention, on the CPEC website, regarding the development of schools, universities, libraries, and so forth. Furthermore, there is nothing dedicated to the health needs of the population through the construction or repair of hospitals, clinics, and health services. Pakistan possesses the 149th ranking within the UN’s health goals index and Pakistan’s expenditure on education is the lowest among its peers in South Asia. Pakistan's leaders should take notice that increasing education levels within a country and increasing adequate access to healthcare is likely to increase economic activity and decrease levels of violence within a society.

A look at recent statistics, published within a government report, “Public Financing of Education in Pakistan and Agenda for Education Budget 2016-17”, further highlights the lack of focus allocated to the role of education within the nation. 64% of the nations school children in the province of Punjab are enrolled in schools for primary education, with 13.1 million children out of school. The figure falls for the province of Sindh with only 48% of children enrolled in school at the primary level with 6.2 million children out of school. In the province of Khyber Pakhtunkhwa, 54% of children are enrolled in school at the primary level with 2.5 million children not enrolled at all. Balochistan follows a similar trend with 50% of school age children enrolled at the primary level with 1.8 million not enrolled in school.

The importance of the role that infrastructure plays within economic development for a nation is not under debate. Pakistan urgently needed to revamp its infrastructure, and power generation and distribution abilities. How else will children get to school and study if there are no roads to drive on or lights with which to read and study with?

The pursuit of infrastructure should not be diminished but the pursuit must be balanced with a focus on many areas of economic development and the prioritization of resources should be measured carefully. Pakistan, as of June 2013, currently possessed a capacity to produce 22,812 MW to fully meet the nations needs of 19,000 MW but problems with distributing that power through the electrical grid and power generation itself has reduced the supply to only 14,000 MW. Within the CPEC budget, $11 billion is dedicated to the construction of ports, railways, and roads with the remaining amount to be dedicated for the construction of power plants.

In essence, the budget for CPEC allocates 25% of its resources to projects based on transportation infrastructure and 75% of the budget on projects aimed at power generation.Under current plans for CPEC, there are a total number of 24 power projects either planned, under construction, or completed. This is a cause of concern as Pakistan will now have an even greater excess power generation capacity with little mention regarding improvements to the electrical grid system. As of now, it is reported that Chinese companies will build the nations first high voltage line, a 4000 MW transmission line, from the district of Matiari in Sindh to the city of Lahore in Punjab. 

Policy decisions such as the ones outlined above raise several concerns, such as “Why aren’t more transmission lines being built connecting the remaining provinces? Why is there an obsession over power projects? And how will decisions such as this impact public perception over favoritism for certain provinces over others?” Those currently overseeing Pakistan's development have overlooked the merits of investing in social infrastructure and have dedicated their focus on particular areas of investment and development that focuses solely on physical infrastructure.

Pakistan, given its position during CPEC negotiations with China, could have allocated several million dollars for the education and health sector, rather than creating a surplus of power generation facilities. Instead, it seems that the government has focused solely on its mantra of infrastructure. Educating women and children and providing adequate healthcare services to a nation is equivalent to an interest earning savings account for a family. The more one puts into the account, the greater the return based on interest becomes, increasing the value of savings and future returns. It seems the strategy currently pursued is stuffing money under the mattress. The money is not earning any interest and if anything happens to the house, the money can be lost.