Political instability and weak economic growth – Latest News – The Nation

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Pakistan’s economy has remained plagued by political turmoil throughout history. Despite its vast economic resources, the country still faces severe economic stagnation due to the threat of political instability. An unstable political system is the danger that impedes the proper functioning of governance and the enforcement of law and authority in a country.
Research shows that countries facing low economic growth often experience an uneven flow of changes in government due to political unrest. In the case of Pakistan, the argument fits well.
Considering the tenures of Pakistani regimes from 1999 to 2022, it is evident that due to political disparity, the country’s economic growth has remained low, corruption has increased, and unemployment and low production have been observed. From 1999 when military rule ousted the civilian government in Pakistan, the country’s economy grew by 4.2% and at the end of military rule in 2008, economic growth was 1.7% .
This decline in economic development was caused by political tensions, as the political stability index shows that political stability was -2.4% in 2008 compared to -1.1% in 2000. Similarly, during the tenure of the PPP regime from 2008 to 2013, the country reportedly faced an increase in corruption and weak economic growth, due to an upsurge in political instability which rose to -2.6% in 2013 from -2 .4% in 2008.
Following the tenure of civilian rule from 2013 to 2018, Pakistan’s economic progress has faced drastic political unrest in the form of demonstrations, rallies and protests by opposition parties and other organizations, especially from Pakistan Tehreek-i-Insaf. Due to PTI headquarters in Islamabad for 126 days, the country’s economy suffered unprecedented losses as trade routes were blocked and trade activities were frozen resulting in loss of 500-600 million rupees. Foreign direct investment was also affected during this tenure due to political unrest.
It was observed in 2014-15 that foreign direct investment declined due to the unstable political situation associated with the Panama Papers and continued PTI protests to overthrow the government of PML-N. Looking at the 3.5-year tenure of the PTI government from 2018 to 2022, the political unrest escalated and from the first day of Imran Khan’s rule, opposition political groups started protesting to derail the performance of the PTI government.
The country faced various insubstantial power exchanges due to which a stagnant and poor economy remained the fate of the country.
Governments in power implement short-term policies to get quick results to maintain their power, which leads to long-term threats to the economy. When political governments collapse, incumbent political groups also often end the policies of their predecessors. Such a rapid shift in political power has created uncertainty in the country.
As a result, large investment groups avoid investing their money in the issue of undetermined government policies that are seen as short-term with no vision for the future. Investment and political stability have a direct relationship with each other. The more politically stable a country is, the more investment there will be in the market. Due to political insecurity, people often do not invest their money, leading to increased unemployment and lack of productivity in the country.
Stable political activity plays a vital role in establishing a stable political system. It relates to a stable attitude of individuals in a society towards the distribution of power to make decisions about what laws to pass and how those laws should be enforced in the country. When society accepts these laws, political stability prevails in the country, which promotes consistent development in all aspects.
A stable political system must therefore be established in the country, as political stability is the backbone of a country to run a smooth governance system. It plays a key role in supporting the progress of the country. A firm political system enhances effective political mechanisms, institutional effectiveness and regular political transitions, i.e. the transition of governments through regular elections or any other mode of exchange of power that a country has.

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