POLITICAL INSTABILITY AND

ITS IMPACT ON ECONOMIC

GROWTH OF PAKISTAN
 PRESENTED BY:
• Zara Ashfaq 686-FE/BSEF(4)/F19
• Maryam Safdar 660-FE/BSEF(4)/F19

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 ROADMAP
Mainspring of political
INTRODUCTION instability Policy recommendation

1 3 5

2 4 6

History Footprints on economic

Conclusion
& background growth

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 “
“Political instability is a natural
tendency of a government to
collapse either because of conflicts
or growing struggles, sometimes
violent, between various political
parties.”
Political instability also occurs if there is a rapid
change of government and policy, increasing the
likelihood of subsequent instability .

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 Distinguishing economic growth factors

Proximate factors Real factors

• Land • Institutions
• Labor • Political stability
• Capital
• Enterprenuership
• R & D’s
• Technological progress

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 HISTORY & BACKGROUND

• History of political instability in Pakistan.

• Various political sessions since now.
• Democratic versus Autocratic eras.
• Which era is satisfactory.

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 HISTORY OF PAKISTAN

CIVIL WAR POLITICS

• Pakistan begins as two separate and divided states . • Pakistan goes back and forth from being a democracy and
being ruled by a military dictator after a coup.
• East Pakistan declares independence from west
Pakistan in 1971.(partition of bengal) • Pakistani politics have a tradition of being under-handed,
violent and volatile.
•Civil war erupts; east Pakistan wins, becomes new
nation of “Bangladesh”.

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 VARIOUS POLITICAL SESSIONS SINCE NOW

•1948: “MUHAMMAD ALI JINNAH”, founding father of pakistan dies.

•1951: “JINNAH’S SUCCESSOR”, Liaquat Ali khan assassinated
•1956: “ Constitution proclaims Pakistan as Islamic republic.
•1958: General Ayub khan become president.
•1969: General Yahya khan takes over in a coup.
•1973: Zulfiqar Ali bhutto becomes PM.
•1979: General Zia ul haq overthrows and hangs Bhutto in a military coup & becomes president. Daughter Benazir goes into exile, returns in
1986.
• 1988: Gen. Zia dies in mysterious plane crash. Bhutto’s Pakistan’s peoples party wins election and she become PM.
•1990: Benazir bhutto is dismissed as PM on charges of incompetence & corruption.
•1991: PM Nawaz sharif begins economic liberalization.1993:
• 1993: PM Sharif resigns under pressure from military. General election brings bhutto back to power.

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 VARIOUS POLITICAL SESSIONS SINCE NOW

• 1996: President Leghari dismissed Bhutto’s government amid corruption allegations.

• 1996: Nawaz sharif returns as PM after his Pakistan Muslim League wins election.
• 1999: Bhutto and her husaband are convicted of corruption and sentenced. Benazir flees to exile. Later that year Sharif is overthrown by
General Pervez Musharraf in a military coup.
• 2002: Musharraf grants himself new powers including the right to dismiss parliament.
• 2007: Bhutto’s and sharif’s parties protest Musharraf. Musharraf takes over media and communication networks.
•2008: Musharraf forced to step down in face of impeachment.
• 2011: Musharraf indicted for assassination of Benazir Bhutto.
• 2013 : Nawaz became PM.\
• 2014 : Mr Khan's petition in the Supreme Court over the Panama Papers has finally pulled him down.
• 2018: Mr. Khan become PM with majority.
• 2022- present: Assembly dissolved under vote of no confidence article and conjoined type of government formed i.e. PDM.

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Democracy MANY DIFFERENT
GOVERNMENTS
vs RULE PAKISTAN,
NON ACHIEVE
STABILITY.
Autocracy
 LINKAGE BETWEEN REGIMES AND ECONOMIC CYCLES

--The economic, social and

political dimensions of
pakistan’s history reflect
fluctuations between
autocratic and more
democratic regimes.
--Existence of different type of
empowerment in Pakistan
shows great
diversification in
economic growth.

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 •Regime 0: First 11 yrs of the
history of pakistan(from1947-58).
•Regime 1: First period of
autocracy in pakistan (from1958-

DESKTOP
71)
• Regime2: First democratic
government (1971-77)

PROJECT
• Regime 3: Second autocratic era
(1977-88)
• Regime 4: Second democratic era
(1988-99)
• Regime 5: Third episode of
autocratic (1999-2008)

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Which era is satisfactory?
•After analyzing regime wise macroeconomic history of pakistan we
conclude that economic growth in Pakistan has been more compatible with
dictatorial political regimes than with democratic ones .Economic growth
was high under autocracy as compared to democracy.
•Keeping in all these facts and figures, we cant predict the either autocracy
is feasible or democracy is good for Pakistan.
•Only external shocks and governments with long tenure with political
stability leads to economic growth.

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 Mainspring of political
instability
• Major causes of political instability in Pakistan.

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 Mainspring of political instability
• System of conflicts since independence.
• Aggressive style of politics.
• Nearly three decades of dictatorship.
• Influence of foreign bodies in domestic politics of Pakistan.
• Influence of Pakistan in neighbor politics instead of domestic one.
• The centralization of power.
• The trend of family leadership.
• Role of opposition.
• Role of media.
• Religious and ethnic tensions.
• Corruption and weak institutions.

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Footprints of political instability
• Impacts of political instability on overall economy.

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 Footprints of political instability on overall performance of country

• Economic growth crisis .

• Decline in foreign and domestic investments.
• Increase in terrorism.
• Atmosphere of civil war and riots.
• Declining social welfare of society.
• Currency devaluation.
• Debt crisis.
• Huge obstacle in the way of development.
• Weakening of global position.

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 Policy recommendation
• Political and economic policies recommendation.

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 How to ensure political stability for economic progress?

• Political level:
- Proper charter of economy, a national document for the country’s salvation by the consensus of all the political parties.
-Long-term vision by the top leadership to faster political and economic stability and to avoid frequent ousters.
- Encouraging public participation to hold politicians accountable for immature and self interest policies.
• Economic level:
-Broadening of the tax base with the help of political commitment, leading to political and economic prosperity.
-Shifting from a geostrategic to the geo-economic hub, a welcome initiative for the country’s political and economic
progress.

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.
Conclusion

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 Conclusion

•It is concluded that political instability and economic growth interact in a negative manner with each other.
•Political unrest in Pakistan reduces economic growth and the inverse of it is also true.
• A weak government increases liability on the money of investors and investment in the country is reduced.
•The government is also incapable to control corruption.
• This reduces development and employment in the country.
•The stability of political institutions is important as compared to political regimes while discussing the economy of
Pakistan.
•Therefore, Pakistan’s economy performed better under different regimes when political institutions were stable.

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THANKS!

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