mics (Ec

T.Y.B.A. mics (Eonomic

omic Dev
Development
s t r a t e g i e s
Aevelopment
of development and left the claim
without
and Planning) (G-3)
of planning shows that with the achieving the
The histo ed
failed to
to achieve their
exception of the Faith Fivetargets
Year
of the
Plans.
Plans have targets.
The overall
line Plan, all other
ie
in Pakistan is
in
hureaucratic
rather than of the
planning machinery
professional. The administration
artments is generally
arious weak, incompetent and working in
variouinn national interest which is a
dominating Over nati
over unsympathetic. Self interest
ar Administrative obstacle line the way of great barrier to economic development.
is

economic
e n able to decide about the nature of economic development is that we have not
so far
d system to be adopted in Pakistan.
eConomy, Socialistic economy. Islamic
economy all are talked about but nothing
conc ncrete hasactually been practiced. There should be
clarity on this fundamental issue
sotthat planning is drawn up according to the
n
socio-economic objective of that system and
a Dath of development lay out. In most of the
developing countries, the governments are
nnt stable. A new government comes into
power overnight; either through coup defeat or
army takes over. The new government introduces a new
system of rules for the operation
of business which causes frustration and discontentment among the
people. How political
instability affect growth does is discussed in brief below.

3.7.1. Influence of political instability:

When there is lack of political stability in the country, it directly affects economic growth. It
closes off sources of internal and external
investments.
1) The External Investors:
The external investors do not invest in a country where there is political instability. The
flow of investment in countries where there is civil war coups, army take over etc.is
either negligible or zero.
2) Internal Investment:
Folitical instability also limits internal investment. The wealthy class in developing
in profitable
Ountries has enough income to spare. They can invest their savings
of
in their own country for fear
Poects. Generally, they avoid investing founds
by militant trade unions,
auonalization of their projects, large scale interference
involved in the setting
exploitative attitude of the variousgovt. agencies
hd the politicians in
projects etc. The well off people including
Operation of the country or channel their
outside the
developin
Pg Countries prefers to take their money
countries are therefore, deprived
country. The developing
n e n t out of their own
growth.
economic
3) investment funds which adversely affect
Internal Disorder: etc. who
ethnic groups
The defeated landlords, the various out
political parties, the rich activities by taking
are not
ed anti govt.
able to capi
capture power take up and support
 bomb blasts,
killing ople
n n o c e n t people
the iinnocent by
by ind
indiscriminateProcesn
processions,
making political instability in thene ca. country and as fisusri
activities
result in creating
these
etc. All development.
economic
affect
adversely

Economic Development:
3.7.2. Political Obstacles in economic development
obstacles in
are the different political
The following
Skills:
1) Lack of Administrative
ment. Whether
to economic development. Whether sunne
support meang
Government support is essential
or actively managing the ales
to flourish and develop ocation
allowing private enterprise
of resources, a poorly organised
or corrupt government can present an ohstal
countries have suffered from well meani.
to economic growth. Some developing
but inept government management. This is most obvious in countries with a lInne
long
history of cannibalization. For example, when the Democratic Republic of the Congo
won independence from Belgium, few of its native citizens were college educatet
Moreover, Belgians had run most of the important government offices. Independence
brought a large group of inexperienced and unskilled workers to important positions d
power. At first there was a period of "learning by doing."
2) Political Instability and Risk:
One of the most important functions that a
government performs in stimulating economic
growth is providing a political environment that encourages saving and investment
People do not want to do business in an
economy that has been weakened by wars
demonstrations, or
uncertainty. For instance, since
in 1825, Bolivia has had becoming an independent natio
more than 150
This kind of changes in government.
instability
forces citizens to take a
short-run view of the econony
Long-term planning is impossible when
policies of the government that is people do not know what the attitudes and
a
going to be in power next year or even next month
will be.
3) Corruption:
Corrupt practices by
government
Payment of money or gifts in orderofficials have long reduced economic rowth
quite widespread in many countries. to receive a government service or Do s
relationship between the level of Research shows that there definite n gative
ere is aa definite
growth. corruption in a country and both and

4) Good Economics as Bad Politics: inves

Every Third World
equal. But all thingspolitician wants to
maximize being
are
rarely equal. Political economic growth, al
immediate objectives than pressures may force a govunent
work toward more to enment to

economic growth.
 nomic
nic Deve
T.Y.B.A.

xample, kimizing growth may mean

Development and Planning) (G-3)
cor exa taxes a and increase investment. reducing the size of government in order
to
lower

eiindorters of the However, in many

stro
the
the
strongest s u p p o r t
political leaders are those
developing countries,
overnment. Obviously, it is not
good political strategy to fire working
for the current
gove
9 o v

overstaffed those workers. So the

aOVernment remains
governmentr and inefficient,
and the
potential for economic growth
falls

3.8 ExternalBottlenecks
3.0 mic development criteria are identical for
T h ee c o n o m i c

developing countries and countries

aduanced economies. Both must use their
existing supplies of resources more
iently and must also increase their available supplies
of resources, althoughall
loning Countries
dev
are aware of these criteria for economic
development, the economic,
institutional, and cultural conditions in these nations are the reasons why they experience
ifierent rates of economic growth. Consider the following external bottleneck to economic
countries.
development in developing
1) Human Resources in Developing Countries:
Developing countries tend to be overpopulated and have high rates of population
growth. These growing populations decrease the developing countries' capacities to
save, invest, and increase productivity. Developing countries often experience both
high levels of unemployment and underemployment.
2) Shortages of Capital Goods:
such as public utilities
Developing countries generaly have shortages of capital goods
of and investment
machinery, and factories. These shortages stem from a lack saving
amounts of capital goods
because the nations are too poor to save. Insufficient
advancementis
contribute to low levels of labor productivity. Moreover, technological
slow in developing countries, which retards economic development.

3) Non-Diversified EconomiesS:
and emphasize
are non-diversified,
ne economies of many developing countries
and agricultural goods.
as bauxite, copper,
production primary products such
of
economies by fostering
would generally prefer to diversify their
DEveloping countries

manufacturing industries.
4) Hinder Economic
Developmentinstitutional and cultural
factors can hinder economic
economic factors,
development.
For exx bribery are
common in many
developing

"ple, political corruption and develop. The people

the desire to
Also, economic growth depends partly on
countries. Uso, changes in
their ways of doing9
indeveloping
gCOuntries willing
to make the
necessary

thic
things
hings inin order to promote growth.
 Q.6. Write note on external bottlenecks in economic development.
Answers in 200 Words:
Q.1. What are the measures of vicious circle of poverty?
Q.2. State the causes of population explosion.
Q.3. What are the general causes of low productivity of agriculture?
Q.4. Explain the significance of capital formation.
Q.5. Explain the types of technology in economic development.
Answers in 400 Words:
Q.1. What is mean by Vicious Circle of Poverty?
Explain the causes of viciou=
poverty.
Q.2. Explain the different effects of population
explosion in economic developn
Q.3. What are the measures of population
explosion in economic development
Q.4. State the causes of low productivity of agriculture in economic developme
Q.5. Explain the measures of low
productivity of agriculture.
Q.6. What are the reasons for
scarcity of capital economic development?
Write Short Notes on:
1) Vicious Circle of Poverty.
2) Low Productivity of Agricuture.
3) Socio-Cultural Constraints in Economic Development.
4) Population Explosion.
5) Scarcity of Capital.
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