Let me start by thanking the Executive Committee of the South Asia Policy and Research Initiative (SAPRI) for inviting me and my Sri Lankan colleague at the South Asia Policy Conference.
This is indeed an extremely important and timely initiative – there is a need for an independent unbiased academic and policy debate on the development priorities for South Asia.
I have no doubt that SAPRI would bring students of South Asian countries and others interested in South Asia together on a common platform to raise awareness about the critical challenges facing the region. You all are the future policymakers of your respective countries.
The analysis you undertake, the passion that you bring to public policy and the commitment to promoting evidence-based policies are all ingredients for sustainable development and inclusive economic growth.
Let me also take this opportunity to thank Ambassador Touqir Hussain, who is also a dear friend, for moderating the session and Dean Montgomery for the warm introduction.
The theme chosen by SAPRI at its inaugural policyconference “South Asia: Re-imagining development for a better future” is highly appropriate in view of the important developments taking place in Pakistan, the region and at the global level.
Pakistan is closely following the historic transformations underway in and around our region and at the global levels.
Within this global context, there has been a paradigm shift underway in Pakistan too and I would like to illustrate further on that.
Ladies and Gentlemen,
Pakistan has been in the eye of storm for several years. However, the situation is looking up for the past several years. Positive developments are taking place. The country is witnessing a silent revolution.
For one,an entirely free, vibrant and active media is emerging in Pakistan. Millions of Pakistanis are constantly glued to Facebook, twitter and other forms of social media and opinions are formed and expressed at the speed of light.
Second,an independent Judiciary has emerged as the ultimate arbiter on many legal issues of enormous political and social impact.
Third,democracy has been strengthened. Pakistan’s first democratic transition in 2013 was a watershed moment in our history.
Fourth, a democratically elected Parliament is asserting its authority and all state institutions are working in accordance with the Constitution.
Fifth, Due to the emergence of a vibrant civil society, issues related to human rights, minorities, women empowerment are under sharp focus.
Ladies and Gentlemen,
These transformations have deeply impacted Pakistan’s outlook towards its region and our foreign policy. The new government’s foreign policy has three distinct strands, which represent a conscious and well-considered departure from the past:
i. To build a “peaceful neighbourhood” so that Pakistan can focus on its economic development, in an environment of peace and stability. Without a peaceful regional environment, free from conflicts and terrorism, South Asia will be unable to realize its full potential;
ii. A rebalancing between geo-strategic and geo-economic priorities, with a sharper focus on economic diplomacy; and
iii. Recognition of the vital contribution of the Pakistani diaspora to national development efforts and a commitment to realize their full potential and ensure their welfare.
Ladies and Gentlemen,
But we do recognize that given the enormous challenges confronting the nation, achieving these goals will require enormous efforts.
Consequently, a great deal of our efforts are underway and the current government is devoted to addressing these challenges based on four key priorities:
a. Reviving the economy.
b. Overcoming energy shortages; and
c. Eradicating extremism and terrorism.
d. Education for all.
Promoting Pakistan’s economic interests is our immediate priority. It is also on top of our medium and long term goals.
The focus of our economic diplomacy is on the expansion of trade and investment and strengthening cooperation with the rest of the world in the areas of energy, technology, education, agriculture and human resource development.
It is with these objectives in mind that we have shaped our economic landscape by introducing bold economic reforms. Pakistan has undertaken taxation reform to broaden its tax base and curb tax evasion, eliminated tax exemptions and concessions, introduced fiscal reforms to reduce the fiscal deficit, reduced electricity subsidies to inefficient power producers, increased the supply of energy to tackle huge electricity outages, and improved the business climate so small and medium sized enterprises can thrive.
We have also expanded social security under the Benazir Income Support Program to protect the poor, providing direct cash transfers to women in about five million poor families and providing conditional educational allowances to families who keep their kids in school.
As a result of these measures and reforms, Pakistan has made steady progress on the economic and social front and registered an impressive GDP growth rate of 4.8 percent and expected to be above 5 percent next year. These economic achievements are now being recognized by international organizations including the World Bank and the IMF as well as international rating organizations.
In 2011 Forbes magazine had included Pakistan among five worst economies due to high inflation, deteriorating security situation and a collapsing economy. The same magazine in 2015 observed that with its improved security dynamics, economic revival and political stability Pakistan presents a global turnaround story.
Similarly Moody’s has improved Pakistan’s rating outlook first from negative to stable and then, more recently, from stable to positive. Moreover, Japan’s Trade Organization, Peter O’Neil, the British Economist, and Morgan Stanley have all predicted that Pakistan will soon be one of the most significant economies in the world. It is with this backdrop that I remain optimistic about the future of Pakistan’s economy and the potential of young Pakistanis to contribute to Pakistan’s economic and human development.
As I mentioned earlier, overcoming energy shortages in Pakistan is a key policy priority for the Government. In order to fill the energy gap, we have initiated a number of ambitious projects in solar, hydel, wind, coal and nuclear energy. By 2018, Pakistan will add approximately 10,000 MW of electricity to its national grid. Our current shortfall is about 4,800 MW. Here, it is important to acknowledge the important support that we have received from our US partners, which contributed around 2,300 MW to our national grid.
Although Pakistan has seen steady progress on the economic front, there is an overwhelming realization in Pakistan that without a peaceful internal environment, we will not be able to achieve our true economic potential. Accordingly, we have developed a National Consensus against extremism and terrorism, as part of Pakistan’s National Action Plan. By launching military operations in North Waziristan against terrorist networks, we have been able to clean up the tribal areas of Pakistan to a significant extent. Similarly, we have launched intelligence-based operations within the country against some of the domestic terrorist organizations. Our efforts are producing results. According to independent sources, terrorist attacks in Pakistan have declined by approximately 60-70 percent.
Similarly on the education front, we have taken a number of initiatives to increase enrolment for both boys and girls in primary schools, reforms of Madrassas and scholarship schemes for higher education. We have recently established a ‘Pak-US Knowledge Corridor’. Thisconcept would be geared to expanding US-Pakistan education cooperation. We plan to have 10,000 PhD graduates, in the next 10 years. The government is also committed to increase the budgetary allocation for education from the current 2% of the GDP to 4%.
Let me now turn to Pakistan’s regional priorities in South Asia. As you are aware, Pakistan is located at the crossroads of four important regions, South Asia, Central Asia, the Middle East and the Asia Pacific. Pakistan’s coastal belt provides China and the entire Silk Road Economic Belt with the shortest access to the warm waters of the Arabian Sea.
The government’s effort is to realize the full potential of Pakistan’s strategic location, in establishing mutually beneficial linkages at the bilateral and regional levels, and serving as an intra-regional and inter-regional commercial and economic hub.
The first major step in this direction has been taken through the multi-billion dollar China-Pakistan Economic Corridor. This mega project will serve as a trail blazer in ushering in a new era of peace, stability, cooperation and development in the entire region. The Corridor will link the western part of China with the Pakistani port of Gwadar through air, rail and road linkages, providing enormous economic opportunities for businesses in the entire region.
We are also working on equally ambitious agendas of mutually beneficial economic cooperation with other countries and in particular with Turkey, Iran and the Central Asian republics. These include mega bilateral projects in the energy and infrastructure sectors.
Key energy and communication projects linking the regional countries include the TAPI gas pipeline project, the CASA-1000 electricity project and the ECO container train project (also known as Gul train), linking Islamabad with Istanbul and the Iran-Pakistan gas pipeline project.
Ladies and Gentleman,
South Asia is home to two fifths of humanity and fast growing economies. Major global developments include the shifting of the economic center of gravity to Asia, which while accounting for 63% of the world’s population, is also home to 12 out of the 30 biggest economies, by Purchasing Power Parity (PPP) including the second, third and fourth largest.
A major thrust of our foreign policy priorities is on transforming our relations with our closest neighbours, Afghanistan and India. We are engaging the leaderships of the two countries, to pursue our common agenda of peace and development.
Pakistan also believes that the South Asian Association of Regional Cooperation (SAARC) provides the Member States with an ideal platform to forge synergies geared to transforming the quality of life of the people of South Asia.
We consider SAARC an important Forum for coordinating a collective response to the region’s challenges including our human development priorities. Pakistan continues to be actively engaged in the SAARC process. In this context, a number of initiatives including South Asian Free Trade Area (SAFTA) and the SAARC agreement on trade and services have been devised to promote regional trade and economic cooperation.
South Asia is endowed with abundant natural, human and financial resources to meet the challenges of poverty, illiteracy, health, low levels of human development, terrorism, and natural disasters, which have intensified in recent years due to changing weather patterns. In re-imagining development for a better future, South Asia needs to build on the SAARC spirit towards evolving and implementing a regional approach – an approach seeking home grown regional solutions to regional problems.
April 07, 2016