Use of technology to deal with illegal spectrum of economy in effective manner

“The best way to predict the future is to invent it.” - Alan Kay

This sentiment captures the essence of Pakistan’s ongoing journey through a landscape marred by deep-seated corruption and significant economic challenges, reflected in its 2023 ranking of 133rd out of 180 countries on the Corruption Perceptions Index by Transparency International. This persistent issue of corruption, with an average rank of 113.04 since 1995, undermines the social contract between the government and its citizens, hampering trust in institutions and stalling progress.

Furthermore, the country’s economic landscape is precarious, as illustrated by a GDP contraction of 0.2% in 2023, following a robust growth of 6.2% the previous year. This volatility highlights the direct impact of governance on economic performance, with historical data revealing a fluctuating growth rate that has often been undermined by cronyism and systemic corruption.

Amid these challenges, the necessity for substantial fiscal policy reform is critical. Pakistan’s low tax-to-GDP ratio, one of the lowest in South Asia, reflects ongoing inefficiencies that hinder revenue generation, despite a slight increase from 0.8 percentage points between 2011 and 2022.

The fluctuating ratios reported by the Federal Board of Revenue (FBR) indicate struggles with compliance and enforcement, essential for maximizing government revenues. While there have been positive developments, such as a 55% increase in foreign direct investment and remittances in 2024, these indicators are inconsistent and come with political and social costs. The pervasive issues of illegal economic activities, exemplified by smuggling and unauthorized spectrum usage, further illustrate the critical need for effective governance and a collaborative tax system to foster sustainable development.

The failure of governance reflects Milton Friedman’s assertion about the essential relationship between control and freedom, as unregulated operations ultimately erode both economic and social sovereignty.

Amid these challenges, the role of accountability becomes essential. The National Accountability Bureau (NAB) and Federal Investigation Agency (FIA) have been positioned as guardians against corruption, but their efficacy in addressing the ongoing crises remains under scrutiny.

As former British Prime Minister William E. Gladstone aptly stated, “Justice delayed is justice denied.” This encapsulates the frustrations of a populace that yearns for swift and fair accountability mechanisms that can provide recourse against systemic injustices.

Moreover, amendments made to the National Accountability Ordinance further complicate these narratives. As Socrates noted, “The unexamined life is not worth living”. The rule of law, conflict of interest, blurred vision about bona fide and mala fide, differentiation between economic activity and accountability and vague definition of criminalization of economic activity are the unexamined aspects of social and economic life, to say the least. However, the discretion given to the bureaucracy is posing a critical challenge to system of accountability, which has led to almost complete erosion of trust in institutions.

The technological advancement, the intersection of governance and innovation presents a critical focus area for Pakistan’s transformation. Automation, when integrated effectively into administrative frameworks, holds the potential to drastically enhance operational efficiencies and reduce corruption.

Furthermore, the public sector has made strides towards modernization through e-government initiatives designed to streamline operations and enhance service delivery. These efforts aim to bridge the chasm between governance and citizen engagement by facilitating greater transparency and reducing bureaucratic red tape.

The possibilities here are substantial; as efficiency increases, so too does the capacity to combat corruption and promote accountability, echoing the sentiments of modern economists who advocate for the use of technology as a fundamental driver for economic growth.

The evolution of tax collection methods, the reduction of human discretion in administrative processes, and the digitization of services can alter the prevailing narrative about inefficiencies deeply rooted in systemic practices particularly the use of AI in FBR, judicial system, law enforcement The algorisms will substitute the discretionary powers of executive without prejudice and bias. Hopefully, it will depoliticize and demilitarize the bureaucracy

Though world is thinking of embarking upon journey of laying off its debts through cyber currency, Pakistan can also envision the long-term project parallel to it because Pakistan faces the existential challenge of circular debt, though it is a day dream but ‘I think, therefore I am,’ Rene Descartes claimed

To truly effect a change, meaningful strategies must manifest that elevate the development and consequent happiness, which is fundamental right. Though the numbers in economy of Pakistan are vacillating but as Albert Einstein said, ’’not everything that can be counted counts not everything that counts can be counted“ it is more than a numbers game, that is; development, satisfaction, contentment and pursuit of happiness of common man for common good.

This can only be achieved through objective, quantifiable, trustworthy new social contract, which is only possible through medium of technology that is universal truth defying the multiple truths of social world rationalizing contradictory phenomenon. This can help foster a culture of change that transcends individual interests and promotes collective aspirations. Plato eloquently reminded us that “The price good men pay for indifference to public affairs is to be ruled by evil men.” This cautionary reflection should resonate deeply, inspiring citizens and state to cultivate a commitment to common good.

Copyright Business Recorder, 2024