Islamabad, Pakistan Economic perks granted to Pakistan’s elite groups, including the business sector, feudal landlords, the country’s mighty political and military class, amounted to $ 17.4 billion, or equivalent. about 6% of the country’s economy, a new United Nations report shows.
Released last week, the United Nations Development Program (UNDP) National Human Development Report (NHDR) for Pakistan focused on inequality issues in the 220 million population of South Asia.
The report uses the lens of “Power, People and Policy” to examine the stark disparities in income and economic opportunities in developing countries.
Power groups use their prerogatives to gain more of their fair share, the report said, with people continuing to discriminate structurally through prejudice towards others. based on social characteristics and policies that often fail to address the inequality that leads to or may even contribute to it ”.
Kanni Wignaraja, UNDP’s assistant secretary-general and regional chief, took a two-week “virtual tour” to Pakistan to discuss the report’s findings, hold talks with Prime Minister Imran Khan and other members. Other top ranks of his cabinet, including ministers. on foreign affairs and planning.
She said Pakistani leaders made the findings of the “correct” report and pledged to focus on regulatory action.
“[In our remarks in meetings] we focus right on the place […] What is the shadow, and what’s really different from the reform agenda in a country, ”she told Al Jazeera in an exclusive interview.
“My hope is to strongly intend to review things like current tax and subsidy policies, to look at land and access to capital.”
Paradox of privileges
The biggest beneficiaries of perks – be it in the form of tax breaks, cheap inputs, higher output prices or preferential access to capital, land and services – are said to be The country’s corporate sector, which has amassed about $ 4.7 billion from franchises. , the report said.
The second and third highest privileged recipients are the richest 1% of the country, who collectively share 9% of the country’s overall income, and the class that owns feudal land, accounting for 1.1%. population but owns 22% of all arable land.
Both classes were strongly represented in the Pakistan Parliament, with most of the ‘candidates’ for major political parties coming from either feudal landlords or the business-owning class of country.
Wignaraja of UNDP notes that this creates a paradox that those responsible for exercising privileges are also recipients of them.
“If on the one hand you are benefiting yourself and on the other hand, what we have lost is a sense of separation between power and supervision,” she said.
The country’s mighty army, which has directly ruled Pakistan for nearly half its 74-year history, was found to have received $ 1.7 billion in privileged dollars, mainly in the form of preferential access to land, capital and infrastructure, as well as tax exemption.
However, the report notes that the Pakistani military is also “the largest conglomerate of business entities in Pakistan, besides being the largest developer and manager of urban real estate in the country, with widely involved in the construction of public projects “.
“These are not clearly separate entities,” Wignaraja said. “Did you see some… these overlap so you almost get the military’s dual privilege. Now in a country, the military is part of the big business, it clearly doubles problems and problems.
In a country like Pakistan, where the military continues to hold power over many aspects of governance, she warns that “a social movement” is needed to replace entrenched power structures.
“It is a difficult issue to do because it is about power politics and I would be naive to expect or suggest to the leaders what to do in this regard,” she said.
“I’m very clear that we can provide the analytics, we can get the carefree story out there and then it’s up to the country, both the state and the people, to say: ‘Enough. Okay, here’s how we need to rest. build groups of power that are strongly held and motivated in this country. ”
The broad-based NHDR provides detailed data on deep inequality in the Pakistani economy.
While the richest 1 percent holds 9 percent of the country’s income $ 314.4 billion In 2018-19, the report showed that the poorest 1 percent accounted for only 0.15 percent.
Overall, the richest 20% of Pakistanis hold 49.6% of the national income, compared with 20% of the poorest, accounting for just 7%.
Aliona Niculita, UNDP’s deputy permanent resident in Pakistan, writes in the report: “The poorest and richest Pakistanis live in completely different countries, with literacy, health outcomes and standard of living. different.
Pakistani policymakers are even more concerned by a shrinking middle class, with UNDP data showing that middle-income earners have fallen from 42% of the population in 2009 to 36% by year. 2019.
The data highlights regional inequalities in service delivery and shows how higher income regions also have higher rates of public expenditure.
“The NHDR 2020 shows that Pakistani people are not equally benefiting from public spending,” the report reads. “The overall rate is 14.2% for the poorest earners News, compared with 37.2% of the richest News. “
‘More rupees for girls’ education
As part of its recommendations, UNDP asked the Pakistani government to increase spending as part of a macroeconomic model focused on bridging the gap between the Human Development Index (HDI). is 0.570 and that of other countries in the region.
Pakistan ranks second in South Asia based on HDI, outperforming Afghanistan but lagging behind all six other neighboring countries in the region.
“This is really what the leadership is asking itself, to this conundrum is feeling like one is stuck at some point,” said UNDP’s Wignaraja, said UNDP’s Wignaraja. “Is there a glass ceiling for human development and why, and what is needed to break it?”
UNDP recommended policies that focus on the elimination of privileges and targeting spending on outcomes that provide both structural support for the country’s poor and infrastructure – such as education. education and health care – will bring them even more economic opportunity.
“If I only have one more […] rupee, and you ask me where I’m going to put it, I’ll put in girls’ education, ”says Wignaraja.
Pakistan ranks 153 out of 156 countries in the World Economic Forum’s Global Gender Gap Index (PDF), with 32% of girls of primary school age not attending school.
“The worldwide evidence of one of the most profitable investments comes from educating all our children and getting them to school,” Wignaraja said.
“But a big profit is all the girls missing at school and all the women missing at work, it’s an investment in that.”
Asad Hashim is digital correspondent for Al Jazeera in Pakistan. He tweeted @AsadHashim.