Economic Problems of Pakistan



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11/05/07  ( economicpakistan report) Faisalabad. The most beautiful moment in the life of humans is when someone of their own blood calls them Ďmamaí or Ďpapaí. Parents want to provide the newborn with the best of everything. He is pampered, protected and taken care of. The wonderful period of childhood soon gets over, and the little human infant grows up to be an adult ready to face the challenges of the world he was born in. He sees around him with a hope of finding the same perfection in everything which his parents had provided him with. In no time, he realizes that this world abound with countless problems- social, economic, legal, political, spiritual and the list goes on.

Certain social and economic conditions become a danger for the society when they start asserting negative influence on the society. Usually those social needs which persist in a society for long period of time turn into socio-economic problems. The major problems of a society are linked with the providence of basic necessities of life to the people making up the society. If the basic needs of man- shelter, food and clothing are not fulfilled, the deprivation of these needs gradually transform into different forms of social menaces Economic prosperity(wealth) serves as a backbone for the overall progress of a nation. One thing is common in all developed nations- they are economically sound. When citizens of a country are freed from the worries of earning a livelihood to sustain their lives, they divert their attention to more useful things. They focus on education, improvise healthcare, develop technologies that make life easy and much more. Poor economic condition is the root cause of so many problems that exist in a society

In the context of Pakistan, owing to the fact that it is a developing nation, there is no wonder that it is surrounding with a number of social and economical problems. The real issue is not the presence of these problems in society because, as stated earlier, there is no concept of an ideal society in the world. Every country in the world has its own set of socio-economic problems. The main issue is the extent and intensity of the socio-economic problems of Pakistan which have soared to alarming levels. Now we will have a broader view of the problem as global issue.All the countries in the world are somehow under the attack of socio economical problem For example: - Poverty, corruption etc

Social Problem:-  Poverty  Illiteracy  Corruption  Unemployment  Child Labour  Health problem

Economical Problem:-  Power crises  War on terrorism  Declining export  Tumbling stock-market  Lack of tourism Loss in business

Now we will consider some of the socio-economic problems & their causes globally and especially with respect to Pakistan.

Social Problems:- 1>Poverty:- Sa racy of lack of basic necessities is called Poverty. The people all over the world are facing serious problems of poverty.

A great percentage of people in world are below the average line of poverty and such condition leads to begin cultural crime such as Suicide, Murder ETC. Almost 70% population of Pakistan live in villages. Most of them donít have access to sufficient basic needs of life. They are struggling for bread and butter. A large chunk of population lives below poverty line. They live in miserable conditions. Lack of proper food, clothing and shelter, poor sanitation, unsafe and sometimes dirty drinking water are just some of their many problems. Poverty itself gives rise to various other social problems. It deprives children of poor people to access education and healthcare. We read crime stories in newspapers that are characterized by lower orders of society who adopt illegal channels to get the financial prosperity which they cannot achieve otherwise.

2> Illiteracy:- What is Illiteracy? Inability to read and write is called illiteracy. The illiteracy rate all over the world is increasing and the prime reason beside it is the high cost of education and lack of institutions and access. People due to lack of resources are unable to educate their childrenís and so chain is developed with ever incr

easing illiteracy. In Pakistan Illiteracy is yet another problem. The literacy rate lingers on 56%. Over the decades, despite decreasing, illiteracy rate in Pakistan has shown an upward trend. Not only that but enrollment ratio of students at primary level has shown a decreasing trend. The facts that 50 percent of children do not complete their primary education testify this fact. Despite spending millions on it, government has failed to achieve literacy rates comparable to other countries in South Asia. Schools and colleges are opened as a business prospect and thus many of them lack quality.

3> Corruption:- Corruption is the prime reason behind the economical unstableness. Corruption has spread into the world and has ruined the economy. Just as a weed spread in the field and affect the yield of the crop. Corruption is the mother of other problem such as unemployment which will be discussed later. According to latest report of Transparency International, Pakistan has been ranked at 42nd number among the most corrupt nations of the world. From clerical staff to higher offices and administrator, all are involved in corruption of one kind or the other. Corruption in government departments is so much deep-rooted that a common concept prevails that the system doesnít let honest people to work peacefully. There is a lack of responsibility due to which wealthy people and those in power are sure that they canít be held responsible for their deeds. So they keep on looting the national treasures and find ways to legalize their black-money. Many corrupt people donít even bother to do that.

4> Unemployment:- Unemployment is a major social problem caused by poor economical system. Whole world is facing serious problems of unemployment and the reason behind it is the unstable economy. Lack of funds followed by unorganized system and lack of new projects are causing unemployment worldwide. Therefore the serving of deserving people is not used, causing loss to both country and the person. In Pakistan major portion of population consists of youth and a large number of young people who have the ability and are willing to work are unemployed. Currently rate of unemployment as per official resources is 7.4% but according to some private estimates the rate of unemployment is 12%. There are many reasons of unemployment like influx of machinery that has replaced manpower, lack of new industries and defective education system. But the impacts of unemployment are more serious and dangerous. People who donít find work here migrate to other countries with better prospects. Also, people tired of making both ends meet due to unemployment indulge in evil activities and ratio of crimes increase.

5> Health Problem :- Health is another social problem caused by poor economical conditions. The cost of living is ever increasing and shortage of funds is a usual problem worldwide. There are less hospitals and medical centers and if there are any, the people are unable to afford their and their children health expenses So the health problems grow unchecked.

6> Child Labour:- Child labour is the most annoying thing that the children which deserve to be educated and provided with all their needs are forced to do work especially physics work which is very painful site. Child labour is the most serious social economical problem. The circulation of money is restrained to rich people only causing the poor to become more poor. Whether in bigger cities or in small villages, we find innocent children employed in various forms of labour. They are working as welders,, plumbers, electricians and in industries like carpet-weaving, glass and football making. Insufficient salary is paid to these children and no facilities for education are provided. In past, some countries refused to import those goods from Pakistan in whose making children were employed. But despite all these factors, due to growing inflation (rise) and poverty, parents are bound to send their children to work to light their stoves.

Economical Problems:- 1>Power Crises:- Power crises are affecting the economy of the world very badly. We are facing an ever decreasing supply of power and ever increasing demands. We are running short of fuel worldwide. All the countries are affected by the power crises. The power crisis is followed by decline in production and at the end the economy of the countries is affected badly. Pakistanís economic conditions are pathetic. As if power crises, lack of foreign investment for the development of industrial zones, backward and out-dated technology were not enough, Pakistanís indulgence in war on terrorism served as a fatal blow to the already crumbling economic state.

2>War on Terrorism:- War against terrorism is another very important reason behind the economical problem. War benefits none, someone is hurt badly and someone is destroyed completely. War is affecting the worldís economy and is causing problems like shortage of fuel, lack of funds, increase in health problem etc. When we talk about Pakistan, Due to war on terror, local people of war-ridden areas are migrating to other areas of Pakistan. Country has seen the largest migration since independence in 1947. These people have left their homes, businesses, possessions and property back home. This large influx of people and their rehabilitation is an economic burden for Pakistan. Unemployment is already common and now the question of providing employment to these migrants has also become a serious concern. This portion of population is contributing nothing worthwhile to the national income yet they have to be benefited from it. This unproductive lot of people is a growing economic problem of Pakistan.

3>Declining export:- Lack of power followed by decline in production is the main cause of declining export which is a major economical problem worldwide. The production cannot even fulfill the demands and hue to decline in export and lack of trouble, the world economy is suffering great problems. In Pakistan, Prices of all consumer products in general and food products in particular are rocket high. Core inflation soared to 18.85% in first quarter of year 2009. Cost of production increased due to various factors. International increase in oil prices and Pakistanís internal unfavorable business conditions are two important factors responsible for high rates of inflation.

4>Tumbling Stock market:- The stock-market is suffering a decline worldwide. Lack of funds and unorganized system is the main cause of the mistrust of certain companies in many countries. Lack of investment and poor economical condition of the people and government is another cause of decline in stock-market worldwide. More over lack of power and decline in production are the other factor. In 2009, many times Karachi Stock Exchange has plunged to its lowest point in the history of Pakistan. Local as well as foreign investors are hesitant (shy) of investing large sums of money in stock exchange in fear of incurring unexpected loss. Stock exchanges showed very poor performance throughout 2009. Situation was so unstable that government had to freeze the market during last quarter of 2009.

5> Lack of tourism:- Lack of tourism is also a cause of the declining in economy. Northern areas of Pakistan have been a place of great tourist attraction. The beautiful hills, the lush green valleys, shimmering lakes and flowing waterfalls brought many a tourist from all over the world to Pakistan. This contributed to foreign exchange. Tourism Industry was one of the booming industries of Pakistan. Besides attracting foreign exchange, it also provided employment to local people. Also, tourist industry was a source of friendly relations with other countries. Nevertheless, war on terrorism has served as a serious blow to the tourism industry of Pakistan. Local as well as foreign media has projected Pakistan as a dangerous and unsafe country. Its poor law and order situation has alarmed the tourist and thus Northern areas no more receive many tourists.

6>Loss in Business:- The poor economical system affects the business very badly. People all over the world are facing serious losses in business. In Pakistan sugar, cement and shoe industry is on its downfall while textile industry is breathing its last. Foreign investors are not ready to setup their businesses in Pakistan. They have their own set of problems which include painful and lengthy procedure of getting licenses and work permits in Pakistan, power crises, terrorism and declining exports. Multinational Companies are unwilling to open their offices and franchises in Pakistan. More than 70 Multinational Companies have already packed up their business from Pakistan.

Conclusion: As stated in the start of my presentation, no country is free from socio-economic problems. These problems are present in every country but the winners are those who overcome most, if not all of them. Though world is currently facing a lot of socio economical problems but it doesnít mean that it is going towards its end. Nations face multifarious problems but together they work for towards the solution. The same is the need of hour. Government as well as every single citizen has to play its own specific role to bring about a positive change.