Economic management

Caught up as a frontline state in war against terror, raked by endemic corruption, emaciated by the laundering out of billions of dollars of ill-gotten wealth and mismanagement by ruling elite, Pakistan's people are crying out for a change in their lot. It is a pity that when through luck the democracy returned the elected representatives and ministers were not prepared and started the learning curve having done no homework while sitting on the opposition benches. Modern economies are too complex and dynamic that on-job learning does not provide the effective management during the term of the government. All we see, experience and receive is more of the same. Take for example the recent mini-budget of Rs 40 billion just announced. Is there no parliamentary opposition, how could it be done without a debate and a parliamentary approval. Why is the annual budget debated and approved by the National Assembly if the government can churn out huge mini-budgets at free will without any institutional check. Rulers take the country as a hand-maiden without bringing into national responsibility the propensity of democratic checks and balances.
If the country can turn up an unprecedented effort driven with extraordinary commitment of fight against terrorists through the operation Zarb-e-Azb, why could it not improve the revenue collection in support of the approved budgetary out-lay. Failure to collect revenues on the part of the rulers is so easily and in an un-inhibited manner passed on to the people that it is Utopian to imagine a delivering government.
Government may have had a right priority of investing in physical infrastructure like roads, motorways, metro buses, etc, except that this priority related to a timeframe of decades behind. The time now is to invest where the returns are much higher and more immediate. All leading economies in the world are now investing their effort and resources in knowledge economy. Service sector is overtaking the industrial in the priority for investment. A notable politician earned the ire of the leadership when he suggested that, as three children were sleeping on the same hospital bed and the University needed upgrading, the metro bus plan for Multan may be dropped in favour of other priority areas in the city. In due course Multan must get a metro bus but the question is what should come first. Let me also dispel the illusion that only hardcore physical infrastructure will catch the public eye as a legacy, knowledge economy will show much wider and much longer! Third time Prime Minister, Nawaz Sharif, is obviously driven by the commitment to create a strong legacy. In the first half of his term he has been focusing only on brick and mortar kind of projects. It will be a pity if in the later half of the term he did not lay the strong foundation for knowledge economy. Pakistan has an envious human resource in terms of intelligence and youthfulness. Quick returns from investment in knowledge economy will provide ample resources for upgrading the physical infrastructure also.
Take for example the 4 trillion dollars investment commitment garnered by the Indian Prime Minister during his brief visit to the Silicon Valley in October this year from just four technology giants over an extended timeframe. He would have found it difficult to raise one-thousandth of this amount for physical infrastructure. Our economic managers need to understand the new wave sweeping the smart world and invest in knowledge related services infrastructure. In a lamentably naive way our rulers think they are on the mark by just dishing out the laptops and living in an illusion of having done enough in the knowledge sector.
There are very vibrant Pakistani expatriate technology experts in the Silicon Valley and they could muster resources through their principals if we could line up the opportunities. It would not be demeaning if our Prime Minister also made a trip to the Silicon Valley in near future to receive both inspiration and bearing even if is unable to get big commitments of investment. Having lived in the Valley for eight years while I was in Stanford University, I feel a visit by him would be contagious for knowledge economy. He needs to transfer that contagion to his cabinet and economic managers.
Industrial economy needs financial, natural and material resources and is subject to the economies of scale. Knowledge economy needs none of the above. Industrial economy manufactures and markets a physical product; knowledge economy develops and markets ideas and skills. As a member of the Advisory Committee for Planning and Development, I had identified a few mechanisms of commercialising the knowledge economy but these are embedded in the minutes of the meeting, which in due course will add to the pile of the record and data lying in the dusty dungeons. It is now the time for bringing out the information from the dusty folders and turning it into digitised information bank to make it a valuable resource of knowledge economy.