Karachi: Pakistan’s economic problems cannot be solved unless its political system is reformed first, according to an article published in Dawn.
The article, written by Sakib Sherani, says the country’s economic system is deeply linked to its political system. If politics is weak and corrupt, the economy will also suffer.
He argues that corruption, rent-seeking and poor governance are damaging the country’s economic structure.
Economic Reform Needs Political Reform
Sherani says that talking about “deep economic reform” without fixing the political system is misleading. According to him, real economic change is not possible unless the corrupt political order is reformed.
He warns that fresh investment, innovation and competitiveness will remain difficult if the current system continues.
Criticism Of ‘Creative Destruction’ Theory
The article also questions the idea promoted by some experts that shutting down inefficient companies will automatically boost economic growth.
Sherani says this theory ignores the harsh business environment in Pakistan. He argues that companies are not just inefficient by choice — they operate under very tough conditions.
Major Challenges For Businesses
Businesses in Pakistan face many serious problems, including:
- Very high electricity costs and power cuts
- Heavy taxes, sometimes over 50 per cent
- Overvalued exchange rate
- Smuggling and under-invoicing
- A large informal economy
- Frequent policy changes
Companies also deal with corruption, bribery, lack of skilled workers, and security costs.
Sherani concludes that unless the political system is cleaned up and governance improves, Pakistan’s economy will continue to struggle.
