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NUST JOURNAL OF SOCIAL SCIENCES AND HUMANITIES
Vol. 7 No. 1 (January-June 2021) pp. 1-35, DOI:10.51732/njssh.v7i1.73
Analysing the Impact of Good Governance on Socio-Economic
Development: A Case Study of Pakistan
Muhammad Hassan* and Rizwan Zeb†
Abstract
The concept of “good governance” has emerged as vital driving force in the
past few decades to positively shape economic growth and sustainable socio-economic
development across the globe in general and developing countries in particular.
However, Pakistan’s turbulent political landscape and deeply entrenched systemic
corruption in the recent decades have utterly harmed the good governance at large,
resulting in socio-economic developmental woes and increased sufferings of the
people. This paper focuses on analysing the influences of good governance on the
socio-economic development in Pakistan in the light of World Bank good governance
indicator and also probe the impact of prevalent perceived corruption in the country in
accordance with observation taken by Transparency International, UNDP, and other
renowned State Institutions. The paper has emphasized on the last two decades to
ascertain the contributory factors by using the appropriate qualitative / quantitative
and statistical techniques that debilitated good governance in Pakistan and caused
continual political instability, pessimism, and recurring political crises and
undermined socio-economic development in the country. Based on the ascertained
findings, the paper has identified impediments to existing governance situation and
prevalence of corrupt practices and has proposed workable suggestions/
recommendations to assist policy makers, development planners, intellectuals,
politicians, and succeeding governments in Pakistan to take corresponding structural
or policy reforms to address the said hurdles.
Keywords: Corruption, Political Legitimacy, Political Stability, Political
Economy, Governance, Rule of Law
1. INTRODUCTION
A consistent and progressive economic development is the key to
achieve inclusive societal growth with objective-oriented well-being of the
people, tackling socio-economic inequalities, and poverty alleviation in
developing countries. Rodrik (2007:2) observed that “historically nothing has
* Muhammad Hassan <mhassanpk16@gmail.com> is a Research Scholar at the
Department of Social Sciences, Iqra University, Islamabad, Pakistan.
† Rizwan Zeb <srizwanzeb@gmail.com> is Associate Professor, Department of Social
Sciences, Iqra University, Islamabad, Pakistan.
2 Hassan and Zeb
worked better than economic growth in enabling societies to improve the life
chances of its members, including those at the very bottom”.
In case of Pakistan, enduring political instability, lack of institutional
coherence, and inconsistency in fiscal policies, further augmented by
widespread corruption and poor governance, have deeply affected its economy.
Pakistan’s socio-economic developmental woes, and a fragile democratic
culture are interwoven with poor governance and widespread corruption. The
major reasons for Pakistan’s economic despairs are declining foreign exchange
reserves, low exports, expanding trade deficit, inflation, and current account
deficit. The Country already trapped in microeconomic crises, now facing the
brunt of the FATF, grey list challenges which have significantly contracted
space for economic freedom. The country has witnessed immense financial
difficulties since its independence.1 It has so far negotiated 22 loans
arrangements with IMF to resolve its financial difficulties. Unfortunately, all
bailout packages failed to end Pakistan’s financial sufferings. Lack of good
governance could be singled out as the major reason for the continual financial
instability and slothful social development despite IMF monetary tightening,
fiscal streamlining, and repeated structural reforms by successive governments.
Good governance energizes democracy, strengthens the rule of law and
public accountability, and reinforces state institutions with feasible economic
environments to help socio-economic development thrive. Generally, it is
considered that governance and socio-economic development are blended.
Hope (2006:80) argues, that “Good governance capacity is necessary for
sustaining economic transformation in particularly developing countries”.
Whereas Rodrik, et al. (2007:17) believes that “good governance is develop-
ment itself”.
However, the notion of good governance remains highly contested
despite its emergence almost half a century ago. In case of Pakistan, the long
years of military regime and weak political Governments further amplified the
governance issues resulting into a stagnant economic growth and pushing bulk
of the marginalized population to poverty and illiteracy. This was further
complicated with the absence of transparent democratic process and
unwarranted role of establishment.
This paper aims to analyse the influence of good governance on the
socio-economic sectors in Pakistan using World Bank good governance
indicator and investigate the impact of corruption in the country using
observation taken by Transparency International, United Nations Development
1 https://www.imf.org/external/np/fin/tad/extarr2.aspx?memberKey1=760&date1key=
2018-04-30.
Analysing the Impact of Good Governance 3
Programme (UNDP) and other renowned institutions. Finally, based on the
research findings, conclusions are drawn and certain policy recommendations
for a well-developed, progressive, and socio-economically moderate Pakistan
are made. For this, the paper sought answers to questions: what are the key
components of good governance? What is the evolving concept of Socio-
economic development and measurements techniques? What is the status of
good governance and Socio-economic development in Pakistan as per the
existing metrics? And, how governance and corruption has influenced Socio-
economic development in Pakistan in the past two decades.
The data were collected from resource personnel such as government
departments and public officials handling governance affairs. However, Public
official from National Accountability Bureau, Pakistan Planning commission,
Punjab Police, District and Tehsil Level Civil administration, Revenue
Department were approached to gather and evaluate first-hand information for
concrete evidence based analysis, but the request was repudiated with affability
and required related information was shared on the conditionality of anonymity.
The secondary data are collected from reference materials such as books,
journals and official publications.
The paper is divided into sections after introduction, the second section
looks into the idea of Good Governance and its key component followed by a
discussion on the linkage between good governance and socio-economic
development. The next section would critically analyse good governance and
socio-economic development in Pakistan through available data from
renowned and well reputed institutions like the World Bank, Transparency
International and UNDP. The concluding section draws major conclusions
taking into consideration the substantial evidence and arguments raised in the
preceding sections and suggest viable/ workable recommendations for
improving socio-economic conditions in Pakistan.
2. Good Governance: A Theoretical and Conceptual Overview
Governance is commonly defined as “the exercise of power or
authority by political leaders for the well-being of their country’s citizens or
subjects.” According to Chibba (2009), “the term governance does not carry a
universally accepted definition”. Rather, in a broader concept “governance is
portrayed with respect to the state and society”. Governance incorporates two
key elements, the first is that how a country including its institutions are
governed and policies, laws, regulations, processes and oversight mechanisms
are implemented. Secondly “its cultural and ideological setting as the
4 Hassan and Zeb
governance is perceived and shaped by values, culture, traditions and
ideology”.
According to the World Bank (2020), “Governance is the process
through which institutional decisions are made and exercised in a country”,
moreover, the governance is grounded on principles of inclusiveness and
accountability.2
The concept of “good governance” has emerged as a vital driving force
in the past few decades to positively shape economic growth and sustainable
socio-economic development across the globe in general and developing
countries in particular. Numerous studies on the subjects have concluded that
good governance practice has significantly contributed in achieving economic
growth and social development in different countries. Rindermann, et al. (2015)
argued that “good governance shapes political and economic institutions and
affect overall economic performance”. Likewise, Sahacter (2000) has
emphasized that Governance is related to power and accountability, therefore,
who holds power and can exercise it, how citizens raise their concerns, and
powers holders are made accountable. As per North (1990), good governance
strengthens accountability, political efficiency, transparency and reinforces
“rule of law” at all tiers of public and private institutions.
According to Sen (1999), “the twentieth century with a remarkable
change beyond the economic sphere has established democratic and
participatory governance as the dominant model of political institution”.
Concepts of political liberty and human rights has emerged widely with positive
effects on the lives on average, people live much longer than ever before. Sen,
explains that democratic governance, includes multiparty elections and free
media with institutionalization of provision of basic protective security.
Furthermore, Sen emphasizes that those dictatorial regimes who suppress
political and civil rights of the people in the state, adversely affect economic
development. Smith (2007) argues “good governance association with the
political power and appropriate supervision of socio-economic resources, as to
enhance the ability of governments to furnish wide-ranging economic policies
and execute them in an effective, and efficient manner”. To the contrary, Kwon,
et al. (2014) argue that good governance does not address poverty in general,
but only for least developed countries. They disproved that good governance
would result in development. Olken, et al. (2012) observed that corruption is a
disease that exists in almost entire world with varying levels. Though, it is a
global phenomenon and affects countries across the globe, this issue has
2 For details, see: http://documents1.worldbank.org/curated/en/711471468765285964/
pdf/multi0page. pdf.
Analysing the Impact of Good Governance 5
adverse implications on the poor countries. Chene (2008) has argued that
“Corruption manifests itself in various forms in Pakistan, including widespread
financial and political corruption, nepotism, and misuse of power. Both petty
and grand corruptions are prevalent in the country”. Collier (2007) in his book
“Bottom Billion” describes “Governance and economic policies assist in
shaping economic performance, but always have an asymmetrical consequence
of getting them right to wrong or vice versa”. Collier (2007) underlines that
“Excellent governance and economic policies can accelerate the growth
process, but limiting to an upper ceiling of around 10 percent of feasible growth
(As economies just cannot grow much faster than this), whereas on the other
hand poor governance and economic policies can hamper an economy with
staggering speed”. Rothstein and Teorell (2008) have critically analysed the
relationship between governance and quality of government (QoG) for
ineffectively addressing the governance related issues. They identify three
basic drawbacks in the existing definitions and asserts that it fails to
differentiate between the access to power by the powers holders and the
application of power. Moreover, it also does not differentiate between the
contents of policies viz-a-viz governing procedures. These definitions are either
too generalized, or affected by the functionalist slant as ‘good governance’ is
“good for economic development”, or to tackle corruption. A broader meaning
of good governance or ‘Quality of Governance is everything, than maybe it is
nothing.
Various studies through empirical evidence have proved that Good
governance is highly important in warranting economic development in any
country. Many of the studies conducted on the relationship between Growth,
governance and development have validated a positive association.
Furthermore, Grindle (2004) underlined that practice of good governance is not
simply associated with development rather it necessitates to take steps for
poverty alleviation, combatting corruption and major irritants causing hurdle in
achieving economic development.
Hussain (1999) asserts that Pakistan since its inception has witnessed
an “elitist growth model”, which he describes as a combination of successive
influential political leaders operating without accountability, a bureaucracy that
without hesitation obeys the desires of the political elites and a flaccid and
submissive population. He asserts that “failure of governance and the consistent
domination of political power and state apparatus by narrowly based elite
seeking to advance private and family interests to the exclusion of the majority
of the population lie at the root of the problem”. Hussain describes that Pakistan
6 Hassan and Zeb
has demonstrated these practices since its creation and highlights that “this
combination of strong autocratic leaders, a pliant bureaucracy, and a
subservient population made it possible for the benefits of growth to be
unequally distributed and concentrated.” He concludes that “the ruling elites
found it convenient to perpetuate low literacy rates. The lower the proportion
of literate people, the lower the probability that the ruling elite could be
replaced”.
2.1 Relevance of Good Governance with Socio-Economic Development
Huther and Shah (2005) describe good governance as “a multidimen-
sional concept encompassing all aspects of the authority exercised through
formal and informal institutions in managing the resource endowment of a state.
Therefore, quality of governance is measured by the influence on the quality of
life enjoyed by its citizens and powers exercised by them”. Fukuyama (2013)
acknowledging the correlation between different facets of governance and
development, argued that economic growth may not be supported by a merely
a strong state with “just enough governance” which may form the foundation
for socio-political development further accelerating enhancements. For Ndulu
and O’Connell (1999), “a key political condition for economic development is
good governance”.
Hope (2009) asserts “good economic outcomes are derived from good
economic governance” and that “good economic governance as the capacity
and existence of governmental institutions to manage resources efficiently and
formulate, implement, and enforce sound policies and regulations”. He further
underlines that there should be no intervention in accountability and monitoring
process. Hope (2009) identifies the key elements which contribute towards
creating enabling favourable grounds for good economic governance,
accountability and transparent conducive atmosphere for private-sector
development and institutional development. Hope stresses that “good economic
governance is necessarily required to improve the state capacity to deliver on
its economic-development mandate”.
Contrary to the conventional wisdom that corruption adversely effects
growth, a number of economists argue that corruption greases the wheels of
economy. For instance, Leff (1964) who analysed the relationship between
economic development and administrative corruption claims that corruption
may be favourable to the economic growth or it may serve as the lubricant to
grease the wheels of economic growth. Though this supposition was an
embryonic concept in visualizing the positive role of corruption and further
provided leads to the many researchers like, Leys (1965); Lui (1985); Lien
Analysing the Impact of Good Governance 7
(1986); Beck and Maher (1986); Bardhan (1997); Huntington (2006); Aidt and
Dutta (2008). These researchers have a contradictory opinion what is
commonly perceived by others that corruption has a negative consequence.
Bardhan (1997) elucidates in his research that there are cases where corruption
shows positive signs in promoting economic development in Europe and
America. Similarly, above mentioned research scholars advocate that
corruption encourages efficiency in delivery of public goods and reduces the
administrative barriers in bureaucratic channels and judicial procedures. Thus,
corruption outcomes enhance the economic efficiency of the country by
reducing the undue obstructions in investment, economic growth and
development.
2.2 Concept of Good Governance and its Key Component
The concept of good governance emerged mainly as reaction to the
practices of poor governance in the African continent during 1980s. World
Bank structural adjustment programme failed to deliver in Africa’s least
developing countries mostly due to bad governance characterized by wide
spread corruption, lack of transparency/ accountability and respect for human
rights. World Bank considered that “it is difficult to tackle the issue of bad
governance without tackling its political roots, which often lie in unaccountable
and authoritarian domestic political systems” (World Bank, 1992). In the
1990s, a paradigm policy shift was implemented i.e. from “getting the prices
right” to “getting the institutions right”3. The concept of the ‘minimalist state’
was replaced with the ‘effective state4, Addink (2019) elucidates that
“Governance deals with state’s capacity to serve its citizens and it is defined as
a basic parameter of a society’s stability and performance. Governance
comprises the set of rules, processes, and behaviours where interests are
articulated. Governance deals with management of resources, and exercise of
power in a society.
Kaufmann, et al. (2010) opined that governance as set of “traditions,
institutional values through which power is exercised, including the electoral
process, accountability and change of government, and the government’s
3 For details see http://documents.worldbank.org/curated/en/604951468739447676/pd
f/multi-page.pdf.
4 See https://www.ucl.ac.uk/dpuprojects/drivers_urb_change/urb_economy/pdf_glob_
SAP/BWP_Governance_World%20Bank.pdf.
8 Hassan and Zeb
capability to enforce its policies. There is no universal model for good
governance that can be applied in all circumstances”.
2.3 Major Components/Indicators of Good Governance
Since 1996, Worldwide Governance Indicators (WGI) have become
instrumental to enable the researcher across the globe, in assessing multi-
dimensional indicators of governance in more than 200 countries to foster
debate/ discussion, and promote awareness on governance related matter and
its implication. Furthermore, the six broad dimensions to measure the
governance for over 200 countries and territories includes, “Voice and
Accountability, Political Stability and absence of Violence, Government
Effectiveness, Regulatory Quality, Rule of Law and Control of Corruption”
[World Bank (2019)]. Over time, considerable evidence has substantiated that
good governance has emerged as leading factor to positively influence on the
sustainable developments in social and economic sectors. Conversely, absence
of good governance impedes well-being of the people, retards social
development, exacerbates poverty and deepens societal inequalities. Therefore,
most of the developing countries are characterised by political instability, weak
growth, dysfunctional institutions, rampant corruption, poverty with
social/economics inequality and neglected human development sector.
Figure 1. Eight Characteristics of Governance5
5 https://www.unescap.org/resources/what-good-governance.
Governance
Participation
Rule of Law
Transperncy
Responsiveness
Consensus
orinted
Equity and
inclusiveness
Effectiveness and
Efficiency
Accountability
Analysing the Impact of Good Governance 9
3. Corruption Hurts Socio-Economic Development-An Inconvenient
Truth
The malaise of corruption regarded as “mother of ills” has existed as
part of human societies since ages with varying degrees. UN Secretary-General
Ban Ki-Moon at the sixth session of the Untied Nation Convention against
Corruption (UNCAC), in St. Petersburg, Russia said that “when bribes are paid,
everyone counts the cost. 6 Transparency International report (2020)7 refers
that “corruption is the abuse of entrusted power for private gain” and it has
become one of the most tenacious issues of the modern day world.
Transparency International classifies “corruption as grand, petty and political
depends on the amount of money used or lost in that particular sector”. Olken,
et al. (2012) considers that corruption is a global concern that is hampering the
countries growth and development across the globe, with more adverse
implications on the poorest countries in particular. Consequently, prevalence of
corruption complemented by poor economic growth fuels the social inequalities
and discontent that eventually leads to fragility of state with increase in violence
and conflict. As per the World Bank (2020) corruption is a serious challenge to
its Sustainable development goals including reduction in extreme poverty and
shared prosperity by 2030 for the poorest people in developing countries8.
Corruption, is a multi-layered process that has an inverse relationship
with good governance, hence they complement each other in a vicious cycle.
Good governance principles if adhered strictly shrink the space, which breeds
corruption. Weak enforcement of transparency, accountability and rule of law
are closely associated with corruption. Hence, the nexus of corruption and poor
governance pose challenges not only to democracy but also undermines the rule
of law and weakens a country’s economic development. Therefore, corruption
leads to poor governance, resulting in economic stagnation, misallocation of
resources, socio-economic inequalities and subsequently political unrest and
conflict.
How corruption hurts governance and economic growth is not an
unanimously accepted notion by large number of economists and socio-
political scientists. As scholars have conflicting opinions whether corruption
6 https://www.un.org/sg/en/content/sg/statement/2015-11-02/secretary-generals-
message-sixth-session-conference-states-parties.
7 https://www.transparency.org/what-is-corruption#define.
8 https://www.worldbank.org/en/topic/governance/brief/anti-corruption.
10 Hassan and Zeb
greases the wheels of Economy or sands them. Haq (2020)9 refutes that
corruption in case of Pakistan greases the wheels of economy and elaborates
that there are three critical differences between corruption in Pakistan and any
other country. First, it distorts our decision and priorities as it is not a
downstream phenomenon. Second, the money earned through corrupt practices
often goes abroad and it is not recycled within the country to grease the wheels
of economy through investment and increased production. Third, the defaulters
of corrupt practices do not get punished. Hence, anti-corruption measures are
more of rhetoric and lesser in reality.10
A number of economists and social scientists have analysed the
influence of governance on the socio-economic development in different
countries and regions from different perspectives. Mauro, et al. (2019) using a
data set of 58 countries observed the influence of corruption including other
institutional factors such as red-tapism, judicial system and political stability
and their impact on economic development and argued that corruption
negatively affects economic growth. As per Gani (2011) the indicators of
political stability and government effectiveness (GE) positively influence the
growth whereas control of corruption (CC) and voice and accountability
negatively affect economic growth. Observation showed that impact of
regulatory quality (RQ) and rule of law (RL) was insignificant for economic
progress.
4. Corruption and Good Governance in Pakistan
Pakistan’s turbulent political landscape and deeply entrenched
systemic corruption, over a period of a time has harmed the good governance
at large. Persistently, prevalent political instability, further intensified by
flagging economic situation and increasing rate of youth unemployment, has
caused pessimism about the country’s future. Growing political patronage and
clientelism, marked by poor governance have not only paved the way for a
widespread political corruption, but have also affected the social and economic
development. Moreover, economic mismanagement and high levels of
nepotism have led the economy into a downward spiral. Pervasive political
fragility, has contracted space for civil society and their confidence to make a
progressive change. Conversely, the widely perceived corruption and reduced
trust of the people in their institutions, further deepened the socio-political and
9 https://mhrc.lums.edu.pk/sites/default/files/user376/corruption_and_development 1.
pdf.
10 See Haq (2020) at mhrc.lums.edu.pk).
Analysing the Impact of Good Governance 11
economic crisis and poses considerable challenges for administrative and
governing bodies in the country.
The quality of good governance is also measured by the WGI, formerly
developed by Kaufmann, et al. (1999). WGI comprehensively encompasses the
governments functioning under six broad clusters. First indicator termed
“Voice and accountability” (VA), mirrors the perception that how effectively
citizens contribute in electing the government through free and fair means, and
perceived freedom of media expression, and association in the country. Second
indicator “Political stability & lack of violence/terrorism (PV) exhibits the
levels of perception of government stability or its possibilities of being ousted
by undemocratic or other unlawful means, like politically-motivated violence.
Third component to measure the good governance quality is government
effectiveness (GE) exhibiting the existing perceived the state of public services
and the influences being exerted by political elites, on civil service from the
policy formulation to its implementation on ground. Fourth, Regulatory Quality
(RQ) measures the existing public perception of the government abilities on
formulation of sound policies/ regulations and their implementation. Fifth
component measures the Rule of law (RL) represents prevalent perception
about independence of the judiciary, confidence in judicial system, assess the
role of police, probability of crime/violence and implementation of contract
enforcement.
Figure 2. Word Governance Indicators (1996 to 2018)
Source: World Bank Group (2020).
0
10
20
30
40
50
Good Governance Indicators
Voice and accountability
Pol Stability and Absence of Violence/ Terrorism
Government Effectiveness
Regulatory Quality
Rule of law
Control of Corruption
Pol Stability has
remained
exceptionally low
12 Hassan and Zeb
Figure 2, graphically represents the good governance indicators of
Pakistan of last two decades. Ironically, Pakistan’s score in these indicators has
remained in the bottom quintile consistently, with insignificant progress.
World governance indicators for the same period in linear graph
reflects bleaker picture and gives a fair idea that how Pakistan remained in
lower quintile persistently. Government effectiveness shown with better score
represents a political setup established under Gen Pervez Musharraf regime.
Subsequently political setups established as a result of 2013 and 2018 general
election and also termed as first ever smooth political transition, exhibit a
different picture. Rule of law, has correspondingly influenced on corruption in
past five years. Likewise, the Government effectiveness has been affected by
the level of prevalent corruption particularly in last five years with conforming
graph. Wide spread corruption and weak Rue of law along with government
effectiveness has consistently remained in bottom quintile for the period under
observation which has overall lowered the WGI score of Pakistan.
Figure 3. Pakistan Word Governance Indicators (1996 to 2018)
Source: World Bank Group (2020).
Transparency International (TI), CPI, measure the perceived
corruption, in different countries on a scale from 0 depicting as highly corrupt,
to 100 signifying, clean countries. CPI, is considered as “poll of polls”,
representing the countries’ perceived public sector corruption, as identified by
expert assessments and opinion survey and by international businessmen and
financial journalists. Pakistan’s ranking in the last two decades have been
0
5
10
15
20
25
30
35
40
45
VA Pol Stab GE RQ RL CC
Analysing the Impact of Good Governance 13
analysed based on the total number of countries measured and Pakistan’s ranks
each year. Appallingly, Pakistan was termed as the 2nd most corrupt country in
1996 CPI. Cohen (2011) termed this Pakistan’s lost decade. However, in the
following years, Pakistan made significant improvement in combating
corruption and better growth with improvement in GDP.
Figure 4. Corruption Perception Index (1996 to 2018)
Sources: Transparency International (2020).
Pakistan’s ranking in Transparency international, CPI and World Bank,
Control of corruption indicators for the last two decades has remained in the
bottom quintile. Although, one should not ignore that during this period,
political instability and war against terrorism negatively affected the economic
growth and government functioning. Transparency International, changed CPI
scoring from 10 to 100 in 2011. Pakistan scored 2.5 out of 10 in 2011 and
remained in lower bracket at merely 25%, whereas in 2012, Pakistan’s score
was 27 out of 100, again in bottom quintile with merely 2% improvement in
inhibiting corruption. Figure 5 represents the CPI and CC ranking from 1996
to 2018. Corruption perception analysis of Pakistan in last two decades by two
well reputed globally acknowledged institutions’ i.e. World Bank and
transparency International present an almost corresponding score with
diminutive variation. Worrisome aspects remain that despite the passage of 20
years, change of successive political setups, fancier anti-corruption
slogans/drive and dilation of National Anti-graft body unbridled powers, why
22.08
24.28
25.41
28.81
32.81 38 40 50 59.973.8
78.86
42.09
55.12
125.96
173.42
199.33
225.33
291.9
336.29
197.25 203.74
5.895.94 6.69 6.61 8.5 11 16 20 27.23
32.737.86
18.71
26.25
33.47
58.74
69.13
78.07
101.73
88.27
47.28
24.03
0
0
50
100
150
200
250
300
350
400
Total Health Expenditure Development Expenditure
Pakistan was the 2nd
most Corrupt country in
the world in 1996
st Corrupt country in
the world in 1996
14 Hassan and Zeb
corruption grew.11 However, after critically analysing the data on corruption
and good governance complied by World Bank and TI and other reputable
report like Global Competitive index elucidates that Pakistan ranking has not
improved markedly, hence concreate efforts have not been undertaken by the
political elite in powers corridors and left the Pakistan strangled in the poor
governance and corrupt mechanism. Details of corruption perception index and
Control of Corruption are shown in Figure 5.
Figure 5. Comparison between CPI and CC (1996 to 2018)
Source: Word Bank (2020) and Transparency International (2020).
Ironically, Global Corruption barometer-2016, reports refer that 40%
Pakistani paid bribes out of which 64% were poor and remaining 26% rich. One
out of every 4 people paid bribes to get basic public services. More disturbing
reality remains the findings of National Corruption Perception Survey (NCPS)
from 2002 to 2011. Police Force which forms the fundamental pillar of the state
to ensure enforcement of law has remained the most corrupt public institution
from 2002 to 2010 and 2nd most corrupt institution in 2011 NCPS Survey. Table
1, shows the 10 most corrupt public institutions in Pakistan, in five different
survey. According to TI, Pakistan suffered the losses of more than Rs. 8.5
Trillion during the PPP-led coalition government from 2008 to 2013 on account
of corruption, poor governance and tax evasion.12
4.1 Socio-Economic Development in Pakistan- An Overview
Pakistan, still confronts multifarious challenges with varying
intensity on the management and financial fronts. Some of the challenges
11 https://www.transparency.org/research/cpi.
12 Transparency International, (2012).
7.53
13.92
24.37
21.21
25.76
13.17 14.15
21.9520.87
18.93
14.8313.81
14.6914.22
17.54
22.1221.63
17.31
22.6 23.56
12.7 02.6 2.5 2.1 2.1 2.2 2.4 2.5 2.4 2.3 2.5
27 28 29 30 32 32 33
0
5
10
15
20
25
30
35 Control of Corruption Corruption Perception Index
Analysing the Impact of Good Governance 15
are multi-dimensional, multi-layered and complex in nature which
certainly will take years to be resolved. However, some of these
challenges are self-inflicted by the political elites or the power hubs that
holds the politico and socio-economic reins of the country’s, one after
another. Therefore, the poor economy of Pakistan with fragile
governance remains the chieftain among the challenges since the
country’s birth. The fragile political structure and bleak picture of
economy of Pakistan are inevitably inter-linked with bad governance and
rampant corruption. Acemoglu and Robinson (2012) in “Why Nations
Fail, The Origins of Power, Prosperity and Poverty,” elucidate that “the
contrast between inclusive and extractive political elites and economic
institutions” and explain that “Extractive because such institutions are
designed to extract incomes and wealth from one subset of society to
benefit a different subset. Further asserting that extractive economic
institutions, in turn, enrich the same elites, and their economic wealth
and power help consolidate their political dominance.” For them,
“Inclusive political and economic institutions are required to drive
nations out of poverty and put them on the long-term growth trajectory”.
Table 1. Corruption in Pakistan (2002-2011)
Public
Department
Corruption
Ranking
National Corruption Perception Survey
2002
2006
2009
2010
2011
1
Police
Police
Police
Police
Land
2
Power
Power
Power
Power
Police
3
Taxation
Judiciary /courts
Health
Land
Taxation
4
Judiciary
Land
Land
Education
Judiciary
5
Customs
Taxation
Education
Local Govt
power
6
Health
Custom
Taxation
Judiciary
Tendering
/contracting
7
Land
Health
Judiciary
health
Customs
8
Education
Education
Local Govt
Taxation
Health
9
Railway
Railway
custom
Custom
Military
10
Bank
Bank
Tendering
/contracting
Tendering
/contracting
Education
Source: Transparency International Pakistan/ National Corruption Perception Survey
(2020).
16 Hassan and Zeb
Though, Acemoglu and Robinson (2012) strongly emphasized on well-
defined property rights and their enforcement, sanctity of contracts and
provision of a level-playing field for all stakeholders. They highlight the
distinctive gap between inclusive and extractive institutions, and power
rested with a little elite with unchecked freedom and fewer constraints.
Utilizing historical data and cases studies, they recommend the
establishment of inclusive socio-politico and economic institutions,
where the tiny political elite does not hold un-fettered power.
Table 2 shows a comprehensive picture of Pakistan Social
development in the past 2 decades. Human development index
seemingly has remained a least priority on our national agenda.
Therefore, mean years of schooling shows clarity of our focus on
educational sectors and their long term outcome.
Table 2. Status of Various Indicators-Pakistan
Year
Life Expectancy
at Birth
Expected
Years of
Schooling
Mean years of
Schooling
GNI per Capita
(2011 PPP$)
HDI
Value
1990
60.1
4.6
2.3
3.195
0.404
1995
61.5
5
2.8
3.361
0.428
2000
62.8
5.4
3.3
3,358
0.449
2005
64
6.5
4.5
3,938
0.499
2010
65.3
7.5
4.7
4,227
0.524
2015
66.6
8.2
5.1
4,727
0.55
2016
66.8
8.6
5.1
4,891
0.556
2017
66.9
8.5
5.2
5,033
0.558
2018
67.1
8.5
5.2
5,190
0.56
Source: Pakistan Economic Survey (2020).
Development of Human capital is closely related with Socio-economic
factors including healthcare, education and environment, etc., but most of the
developing countries lack the policy initiatives and priorities in allocation of
resources for a sustainable and robust healthcare system. Pakistan has also
under prioritized its health & nutrition sector and as a resultant as per economic
survey of Pakistan 2018-201913 and Pakistan Bureau of Statistics, we have one
hospital bed for 1608 people and one doctor to look after 963 people. Health
13 See, finance.gov.pk/survey.
Analysing the Impact of Good Governance 17
and Nutrition expenditure of past two decades gives a clear understanding our
focus on health of people as part of human capital development.
Figure 6 shows the percentage of GDP allocated for health sector by
the successive governments from 1999 to 2019. Health budget was accorded
priority in 2017-2018 by allocation of Rs.336.29 billion, as 0.97% of the GDP
share which in the following year has declined to 0.53% of GDP share by
incumbent Government. Ironically, Pakistan along with neighbouring
Afghanistan are the only two countries in the world, where poliovirus cases
transmission still exists. Though, the number of poliovirus cases sharply
dropped from 306 cases in 2014 to only 12 in 2018 but unfortunately the
number of poliovirus with a significant rise jumped to 144 in 2019. Such a large
number of poliovirus cases in single year can be conveniently attributed the
flawed priorities of the health sector management and poor governance.
Figure 6. Health & Nutrition Expenditure of Pakistan (1999-2019)
(Rs. in Billion)
Source: Pakistan Economic Survey (various Issues).
A comparison with regional countries gives a better understanding of
our socio-economic development standing in the South Asian region. Figure 7,
shows that Pakistan ranks 2nd last on UNDP HDI ranking out of 9 regional
countries and 2nd last country with literacy rate and public expenditure on
education.
0
50
100
150
200
250
300
0
50
100
150
200
250
300
350
400
Total Health Expenditure Development Expenditure
Current Expenditure
18 Hassan and Zeb
Figure 7. Health & Nutrition Expenditure of Pakistan (1999-2019)
Source: Pakistan Economic Survey (2020).
Table 3. Comparison with regional countries
Country
Literacy rate adult
% age 15 years and
older (2006-2016)
Youth % age 15-24
years old (2006-2016)
Public Expenditure
on education (% age
of GDP) (2012-2017)
Human
Development
Index
(HDI) Rank
Female
Male
Pakistan
57
65.5
79.8
2.8
150
Iran
84.7
97.7
98.2
3.4
60
Sri Lanka
91.2
98.6
97.7
3.5
76
Maldives
98.6
99.4
99.1
4.3
101
India
69.3
81.8
90
3.8
130
Bhutan
57
84.5
90.4
7.4
134
Bangladesh
72.8
93.5
90.9
2.5
136
Nepal
59.6
80.2
89.9
3.7
149
Afghanistan
31.7
32.1
61.9
3.2
168
Sources: Pakistan Economic Survey (2018- 2019).
Figure 8 exhibits a comparison that how corruption has exercised its
influences on human capital development in Pakistan in the last 20 years.
Control of Corruption Index (World Bank, WGI), correspondingly align with
human development index measured by UNDP.
0.580.580.570.590.580.570.510.570.570.560.53
0.230.27
0.56
0.690.730.77
0.910.97
0.490.53
0.58 0.58 0.57 0.59 0.58 0.57 0.51 0.57 0.57 0.56 0.53
0.23 0.27
0.56
0.69 0.73 0.77
0.91 0.97
0.49 0.53
0
0.2
0.4
0.6
0.8
1
1.2
Percentage of GDP Share
Lowest
Budgetary
Allocation
Analysing the Impact of Good Governance 19
Figure 8. Comparison between Human Developments Index and Control
of Corruption
Source: World Bank and UNDP HDR Reports (2020).
Sherani (2017) explored the governance performance of Pakistan to
ascertain “The missing piece of the development puzzle” in his paper on
“Institutional reforms in Pakistan”. His research analysis encompasses review
of Pakistan scores in World Governance Indicators of World Bank covering the
period from 1996 to 2015. He observes that Pakistan performance has remained
in the lower quintile in all six indicators of WGI. Pakistan scores varied
between 18 to 32 percentile with least recorded performance in political
stability and Corruption. However, better score was recorded in the remaining
component of WGI and improvement in economic growth under President
Musharraf regime. Though, Pakistan ranks dropped as compared to the
neighbouring countries, India and Bangladesh in HDI and CPI.
Political turbulence and enhanced societal insecurity have subjugated
Pakistan political landscape over the last 20 years. Democratically-elected
governments from 2008 to 2018 completed political tenure under intense
political pressure and with disqualification of two of their premiers. Political
instability had far reaching effects and already existing systemic corruption
strengthen its root much firmly. Wide spread Petty corruption in the shape of
bribery prevails in the society and public sector particularly, police and land
department. Judiciary is allegedly infested with corrupt practice; particularly
lower judiciary is perceived to have more corruption. Most often corruption, in
terms of bribes is found while citizen access the public sector department for
0.433
0.464 0.513 0.52 0.524 0.528 0.533 0.537 0.54 0.55 0.556 0.558 0.56
-1.22
-0.91 -0.9
-1.07 -1.09 -1.08 -1.06 -0.96
-0.83 -0.81 -0.88
-0.78 -0.79
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
1996 2002 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Human Development Index Control of Corruption
20 Hassan and Zeb
the obligatory public services. The public procurement processes are the most
affected by corruption as despite the existing law on open and competitive
bidding, the nepotism, favouritism and kickbacks dominate the awards of
government contracts. Over the period of time various efforts have been
undertaken to form a comprehensive mechanisms and institutional framework
to tackle the deeply embedded corruption. Therefore, formulation of National
Anti-Corruption Strategy was a concrete step to handle the menace of
corruption stringently. The establishment of NAB, with ample authority to
arrest, investigate and prosecute was aggressive step to eliminate corruption,
however lack of political will, marked by hidden agenda to use NAB for
exploitative political means undermines its role drastically. The NRO of
October, 2007 gave a, massive setback to the national drive against corruption
by providing blanket immunity to the corrupt elite and public officials by
shielding them from prosecution.
4.2 Who is Hurting More, Corruption or Poor Governance?
The Corruption, generally perceived as “the abuse of public office for
private gain” exists all over the world, with varying degrees and forms.
Corruption is often considered as a problem of least developing countries with
weak institutions, fragility and affected by conflict, but horrendously, it never
restricts itself within the national boundaries. Haque and Kneller (2004)
analysis validate that corruption widely prevails in developing countries
particularly in public sectors. According to World Economic Forum (2019)14
“Corruption in form of, bribery, theft and tax evasion, and other illicit financial
flows cost, developing countries worth 1.26 trillion US dollar per year. It is
approximately the size of the economies of Switzerland, South Africa and
Belgium, and sufficient enough money to lift 1.4 billion people out of extreme
poverty at less than $1.25 a day for at least six years”. Presumably, the cost of
perceived corruption is considered larger than the money lost as a result of
economic distortions, altering the national spending’s priorities to undermine
the state’s ability to promote inclusive growth and socio-economic
development. Such corrupt behaviour drains public resources and stresses to
alter the priorities for allocation of funds required for the well-being of people
and socio-economic development. Hence, Pakistan is not an exception and
corruption remains a substantial obstacle to thwart socio-economic develop-
ment priorities at varying levels and distortions in the spending behaviours.
14 See https://www.weforum.org/agenda/2019/12/corruption-global-problem statistics
cost/.
Analysing the Impact of Good Governance 21
Therefore, deeply ingrained systematic corruption manifests itself in numerous
forms in Pakistan, from petty to grand in financial institutions, political
systems and civil society.
World Bank Governance indicators from 2008 to 2018 in Figure 9
represents that an inverse correlation between control of corruption (CC) and
government effectives (GE) exists from 1996 to 2018 in Pakistan. Lower
percentile of control of corruption, influences the Government effectiveness
correspondingly, signifying if corruption is curtailed effectively it enriches the
government functioning and proficiency. President General Pervez Musharraf
decade long regime was followed by establishment of Pakistan People’s Party,
(PPP), Government under President Asif Ali Zardari in 2008, and witnessed
highly hostile internal environment. The country suffered from the intense
wave of Talibanization and military operation with larger number of population
as internally displaced persons (IDPs).15
Figure 9. Impact of corruption on Government Effectiveness in Pakistan
(1996-2018)
Source: World Bank (2020).
However, deep political turmoil, continual poor governance, persistent
wrangling with the judiciary, strained civil-military relations and further
worsened by lack of a coherent economic and progressive fiscal policy, kept
the country under PPP government in a state of crisis. Successor Government
established in 2013, hardly muddled through owing to multitude of
15 See, https://reliefweb.int/sites/reliefweb.int/files/resources/1256E15963B623E3492
574C20008A192-Full_Report.pdf.
-1.22-1.05
-0.84-0.91 -1.08 -0.9 -1.07-1.09-1.08-1.06 -0.96-0.83-0.81 -0.88 -0.78-0.79
-0.62
-0.46
-0.6
-0.41-0.46
-0.72
-0.8 -0.77-0.82 -0.78-0.79-0.76
-0.67-0.65 -0.6 -0.63
-0.9
-0.8
-0.7
-0.6
-0.5
-0.4
-0.3
-0.2
-0.1
0
-1.4
-1.2
-1
-0.8
-0.6
-0.4
-0.2
0
1996 1998 2000 2002 2004 2008 2009 2010 2011 2012 2013 20142015 2016 2017 2018
Control of Corruption Government Effectiveness
22 Hassan and Zeb
political instability caused by the righteous rage articulated on the pretext of
electoral irregularities, corruption in political circles though prolonged sit-ins
and social media drive. However, Pakistan first ever smooth political transition
was endowed with progressive economic growth and improvement in the
corruption ranking was colossal achievement.
Table 4. Corruption Versus Good Governance CPI vs CC (1996-2018)
Year
Transparency International
World Bank WGI
Total
Countries
CPI
Rank
CPI
Score
VA
Pol
Stab
GE
RQ
RL
CC
1996
54
53
1
31.5
14.36
31.69
28.8
31.66
7.53
1997
52
48
2.53
-
-
-
-
-
-
1998
85
71
2.7
33.33
14.89
37.31
29.02
25.5
13.92
1999
99
87
2.2
2000
90
NA
NA
12.94
15.87
30.26
20
21.78
24.37
2001
91
79
2.3
2002
102
77
2.6
16.83
6.35
40.82
21.94
26.24
21.21
2003
133
92
2.5
14.93
7.54
41.33
22.96
25.74
25.76
2004
145
129
2.1
16.83
5.83
38.92
17.73
19.62
13.17
2005
158
144
2.1
20.67
5.34
39.71
26.47
22.01
14.15
2006
163
142
2.2
24.52
2.9
40.98
34.31
22.97
21.95
2007
179
138
2.4
21.15
0.97
37.38
31.07
21.05
20.87
2008
180
134
2.5
25.48
0.96
26.7
30.58
17.79
18.93
2009
180
139
2.4
24.17
1.42
23.44
30.62
21.8
14.83
2010
178
143
2.3
27.49
0.47
25.36
29.67
27.49
13.81
2011
182
134
2.5
25.82
0.47
22.27
28.91
19.72
14.69
2012
174
139
27
24.88
0.95
25.59
25.59
21.13
14.22
2013
174
127
28
25.35
0.95
24.17
26.07
22.07
17.54
2014
174
126
29
27.09
3.33
23.08
28.37
25
22.12
2015
180
117
30
27.09
1.43
27.4
28.85
24.52
21.63
2016
180
116
32
27.59
1.43
28.37
27.4
20.19
17.31
2017
180
117
32
28.08
1.9
30.29
29.33
24.04
22.6
2018
180
117
33
25.62
3.33
24.92
27.4
27.88
23.56
Source: Word Band and Transparency International (2020).
World Bank Policy note 13 on Pakistan16 refers that a large-scale
survey carried out in Pakistan, inquired that “What is the most important
obstacle to economic progress?” The most prevalent answer was corruption.
Incompetent leadership and poor governance were placed as the second and
third factors. The Survey ascertained that young entrepreneurs in Pakistan
16 See World Bank, Pakistan Policy note 13 (2013) http://documents.worldbank.org/c
urated/en/231321468325466162/pdf/795800BRI0SASE0ox0377381B00PUBLIC00.
pdf.
Analysing the Impact of Good Governance 23
consider corruption a major constraint to industrial and economic
development.” Table 4, gives a summarize view of the prevalent perceived
corruption as measures by TI and good governance by World Bank in Pakistan
in last 20 years. Pakistan ranking as measured by World leading and well
reputed institutions is inauspicious and discouraging. Data represent that
Corruption and good governance indicators are complementary to each other.
The Inverse, impact of corruption has already been analysed and observed in
Figure 9, above, World Bank data on corruption and GE substantiates that more
corruption negatively influences the government effectiveness in the country.
However, the Figure 10 highlights that any variation in the Government
effectiveness as measured by the World Bank, positively influences on
economic growth and GDP growth percentage. As in 2005, Pakistan
Government effectiveness percentile was measured as 39.71, which resulted in
the highest GDP growth i.e. 7.7 %, whereas on the contrary, GE declined to 25
and 22 in 2010 and 2011 which adversely reduced the GDP growth to 1.6% and
2.6 %, respectively. The corresponding inverse relationship between corruption
and GE and positive influences of GE on GDP Growth in past two decades can
be evidently observed. Hence, it validates that corruption as sub segment hurts
Good governance and poor governing apparatus, hurts economic growth which
undermines the state’s ability to focus on socio-economic development.
Figure 10. Impact of Government Effectiveness on GDP Growth (%)
Source: World Bank Group / State Bank of Pakistan (2020).
5. CONCLUSION
The global North of the world has achieved a significant development
which have elevated millions of people out of absolute poverty, but despite
4.8 2.6 4.3 3.2 4.8 7.4 7.7 6.2 4.8 1.7 2.8 1.6 2.7 3.5 4.4 4.7 4.7 5.5 5.7 5.8
31.69
37.31
30.26
40.82 41.33
38.92 39.7140.98
37.38
26.723.44
25.36
22.27
25.59
24.17
23.08
27.428.37
30.29
24.92
0
10
20
30
40
50
GDP Growth % GE
24 Hassan and Zeb
these colossal improvements in living standards, other parts of the globe present
substantial evidence of increasing inequalities, social exclusions and widening
gulf between the worlds’ richest and poorest. The world has become more
complex with larger socio-economic inequalities and growing differences
among the richer and poorer communities globally.
The developing world has yet to realize their potential and the
advantages of good governance, vibrant economic policies and frameworks.
An immensely available literature explicitly associates bad governance as the
sole contributes towards the poor growth in economic sectors and flagging
socio-economic development, particularly in developing countries. Its need of
the time, that developing country like Pakistan endowed with enormous natural
resources and massive potential should address the lacunas in governance
systems and combat corruption for a better tomorrow.
The critical analysis of existing literature signifies the correlation
between governance, perceived Corruption, economic growth, and
development of social sector of Pakistan in the preceding sections and gives an
insight of certain leading deductions/ conclusions. Analysis of available data
with particular focus on the identification of grey areas which consistently
jeopardizes good governance and socio-economic development will help us
suggest a viable and workable strategy to address hurting anomalies. The values
considered for analysis from World Bank, TI, UNDP and the State Bank of
Pakistan are highly significant and indicate moderate to strong influences of all
the independent variables on the dependent variable. However, there are certain
influences observed in the preceding chapters, which have played a
considerable impact on the dependent variable with change of successive
political regimes in past two decades. For instance, GDP Growth Sharply fell
after departure of Governments in 1996/97, 2007/08 and recently 5.8 percent
growth rate declined to 3.3 in 2018/19. Such variable which causes substantial
impact on consistency of economic and GDP growth after departure of each
political regime necessitates further probe and a suggested ground for future
research to align a country direction and shape Pakistan future. Major
conclusions and grey areas deduced out of the discussion are as under.
Political stability and legitimacy of the electoral process is earnestly a
genuine concern of the day. Despite passage of seven long decades, yet, country
have not been able to acquire that level of political maturity and sanity that can
absorb smooth transition of political regimes from one to another. Abysmally,
election results have always been termed as flawed and engineered and
accepted with pervasive discontent and dissatisfaction on the pretext of rigging,
interventions and void of free, and fair conduct. Hence, elections results have
lacked credibility and have been disputed or repudiated by the opposition
Analysing the Impact of Good Governance 25
parties with allegations of rigging and manipulation. The legitimacy of every
successive government turned questionable and resulted in countrywide
agitations on the perception of the manipulated election. Opposition parties’
denunciation on the legitimacy of electoral process and demands for fresh
elections through wide spread protests results in a political turmoil and situation
of confrontation thus paralyzing democratic functioning and destabilizing the
country. More so, if at all the results were accepted, the political setups failed
to complete their due terms, making them more harmful for democratic process.
Political setup under General Pervez Musharraf was the first one to complete
five-year term but strongly excluded by the political belligerents calling it a less
democratic setup. Political Government formed in 2008 and 2013 were
fortuitously able to complete their tenure in history of Pakistan but under highly
turbulent political environment and at the cost of disqualification of their prime
minister.
Bureaucratic system of Pakistan is antiquated and exploitative in nature.
Despite, the massive efforts undertaken by successive political leadership and
military regimes in power to streamline and address its system embedded
deficiencies, it resulted in adding to more ineptitude. Repetitive disregard of
merit-based promotions and appointment, endorsing nepotism, favouritism
enabling space for servility and enlarging servitude behaviours by discouraging
dissenting opinion/inputs added in more ineffectuality’s. Political elite have
discouraged the flourishing of a professionally healthy and a moderately
progressive culture in bureaucracy, rather they have impelled subservient
approaches, apathy, fear through purging without due legal processes and
failing to enforce transparency and accountability. Hence, as consequences it
emerged as highly politicised civil service and utterly eroded the quality of
good governance through inconsistent public services delivery and hollowed
people’s trust in their institutions.
Transparency contributes significantly in the developing economic
efficiency and socio-economic sectors. Transparency through Governmental
oversight policies ensures judicious allocation of public resources and curtails
space for corruption. Transparency in public decision making processes enables
investors’ confidence and encourages investment and growth. Moreover,
Political and fiscal/financial transparency forms an imperative basis for good
governance and it cannot be divorced from economic governance. The
institutions of economic governance are strongly nested with socio-politico
environment in the country grounded on the transparency in fiscal and political
decision making. Incongruously, we lack on all such transparent mechanisms,
26 Hassan and Zeb
including electoral processes, formulation of fiscal and monetary policies and
decision making processes, resulting in far-reaching socio-politico
imperfections, dissenting environment, and proliferating poor governance and
more corruption.
The deteriorating situation of rule of law, directly influences on the
Government efficiency and state of political stability. It is generally perceived
that countries having stronger ‘rule of law’ are considered politically stable and
have better chances of economic growth. Pakistan, as part of the international
coalition force on war against terrorism, after 9/11, faced the major brunt of
terrorism. However, the far-reaching tragedy of 9/11 altered the geo-strategic
significance of Pakistan in the region. The alliance of Pakistan with the US and
its coalition forces resulted in restoration of financial aid and acceleration in
their size and inflows. But on the other hand Pakistan paid a very heavy price
in terms of volatile internal security environment. Apart from huge financial
losses and loss of human lives, space for good governance condensed sharply
and radicalization spread largely which deeply impacted the socio-economic
development in the country.
Hausmann (2014) 17 suggests that “If you want to predict the prosperity
of a country, just look at its institutions. When they fail, trust is eroded and
economies are damaged18.” Accordingly, North (1980) has underlined that
“Institutions matter, as they influence norms, beliefs, and actions and therefore,
they shape outcomes. ‘Institutions are endogenous’ as their forms and
functioning depends on the conditions under which they emerge and endure”.
Pakistan’s public institutions need a massive overhauling and immense
capacity building. Like other institutions, Pakistan judicial system is highly
cumbersome, pricey and protracted, therefore, justice dispensations result in
indefinite delays, with no accountability. Moreover, judiciary has yet not been
emancipated from the ill influence of the executive. It has also failed to
comprehend that after independence that sovereignty had passed onto the
people and was no longer vested with the King or Viceroy. Before,
independence all the government functionaries, including judiciary, remained
institutionally loyal to the “Colonial Raj” phenomenon which continues till
today, whereas, people now want to give vent to their voice through their
chosen representatives, i.e. Parliamentarians The role of higher Judiciary in the
politics has remained controversial. It had given some glaring democracy-
retarding judgments especially in the cases relating to Tamizuddin, Dosso and
17 https://www.project-syndicate.org/commentary/government-private-sector
cooperation-by-ricardo-hausmann-2014-12?barrier=accesspaylog
18 See Ricardo Huasmann, 2014. Available at projectsyndicate.org.
Analysing the Impact of Good Governance 27
Nusrat Bhutto.19 The justice Munir judgment in the Tamizuddin case has been
cited by almost all the historians as one single judgment which legitimized the
action of the Head of the Country or State. It has been stated that the history of
Pakistan would have been different if Justice Munir had taken a judicial
decision instead of pragmatic view of the case20. Till the time, the Superior
Courts continue to legitimize dissolution of Assemblies and imposition of
Martial Law under the “Doctrine of Necessity”, the course of country’s
predicted future will not change. It is generally believed that the judiciary in
Pakistan has always gone along with the establishment.21 It is indeed the failure
of political system which has been burdening the judiciary with political issues
and leaving question marks on its impartiality.
Investment on human capital is one of the most neglected priority of
Pakistan political elites. It is a disturbing reality of the day that Pakistan ranked
152 out of 189 countries/territories in the world in the UNDP’s Human
development index 2018.22 What’s more alarming is that Pakistan value in HDI
has increased from 0.404 to 0.560 from 1990 to 2018, merely 38.6% in 38
Years.
6. RECOMMENDATIONS
Pursuance, to the major conclusions and deductions derived
inconsideration with the analysis of the substantial evidence complied by
renowned international and state institutions, various economists and political
scientists gives an insight and lucidities to our understanding of a country’s
deep rooted issues. Hence, based on these systems embedded errs and appalling
fault lines, following recommendation are proffered:
a. Fostering Political Legitimacy: Carl Von. Clausewitz (1780-1831)23 under-
lines the significance of political legitimacy and refers that “building
legitimacy is the “Schwerpunkt”, the centre of gravity of the strategy”.
19 See Dr Inayatullah, State and Democracy in Pakistan, (Lahore: Vanguard Books).
1997), p.107.
20 See N.H. Jaffry, Federalism, Political Parties and Democracy, (Rawalpindi: Friends
Publications, 1995), p.26.
21 See Hamid Khan, Constitutional and Political History of Pakistan, (Karachi: Oxford
University Press, 2001), p.875.
22 See (UNDP, HDR report 2018) http://hdr.undp.org/sites/all/themes/hdr_theme/coun
try-notes/PAK.pdf.
23 See Clausewitz, C.., Howard, M., Paret, P., & Brodie, B. (1984). On war. Princeton,
N.J: Princeton University Press.
28 Hassan and Zeb
Legitimacy of political regimes can be achieved through free, fair and highly
transparent electoral process. Political setup established through transparency
will not have chances of early removal as such premature removal of elected
Governments causes deep rooted political instability and lasting effects on
political legitimacy. Regimes devoid of legitimacy and infested with political
instability inevitably create vacuum for military interventions. Similarly,
Pakistan has suffered from recurring military interventions and dictatorial
regimes while facing ironic challenges of government’s legitimacy and
instability. Hussain (2018) asserts in “governing the ungovernable”, that
“Empirical evidence suggests that economic accomplishments devoid of
political legitimacy, however impressive, may prove to be elusive and
transient, and do not leave any lasting footprint”. During the early years of
Pakistan, the replacement and dismissal of governments was a usual
phenomenon. Hence, Pakistan needs to break the vicious circle of political
instability through building the legitimacy of democratically elected setup and
restoring the trust of people in the state. Eradicating, the hurdle in exercise of
good governance and strong institutions to safeguard the people rights. The
significance of political legitimacy and its subsequent influences on the socio-
economic sectors can be observed in the cycle explained in Figure 11.
Figure 11. How Political Legitimacy Influences Chains of Socio-Economic
Development
Source: Authors’ own view.
Political
Legitimacy
Political
Stability
Economic
Growth
Socio-
Economic
Development
Analysing the Impact of Good Governance 29
b. Nurturing Sustainable Political Stability: The continual political instability
and overwhelming pessimism about country’s future has emerged as a
perpetually recurring crisis of Pakistan’s turbulent political history since its
creation. Smooth transition of power among the political gainers and those lost
the public confidence turns nightmare and fuels deep political crisis. Widening
gulf of political differences and deepening mistrust amid political parties can
never flourish a socio-political harmony. Hence, the gateway to a resilient and
congruent democratic culture associated with sustainable political stability and
socio-politico harmony is passes through indubitable political legitimacy.
Political stability serves as the key driving force in creating healthy political
atmosphere and enabling environment for socio-economic development.
c. Enduring Economic Growth and Stability: Sustainable economic growth is
a driving force for inclusive “socio-economic development and material well-
being of the people”. However, Pakistan’s tempestuous political landscape has
caused considerable distortions in acquiring sustainability in economic growth
and social development. The leading cause ascertained is the persistently poor
performance in good governance coupled with large scale rent seekers
influences and bureaucratic manipulation of management policies. Economy
was further hurt by the financial indiscipline, adhocism and imprudent
fiscal/monetary policies associated with deep rooted corruption. Moreover,
successive political regimes and military rulers did not take the initiative to
correct the fundamental errs, rather preferred a smooth sale through policy of
appeasements and reconciliations. The audacious steps and formulation of bold
policies like expanding the tax base, registration of informal /shadow economy,
imposition of agricultural tax and striking a fine balance between
developmental/ non-developmental expenditure was evaded. Ineffectual
economic mangers, further trapped the country into a vicious circle through
consist budgetary deficit, growing burden of foreign and domestic debts and
slack management of financial expenditure over the past few decades. Hence,
continuity of such policies will aggravate the problem and worsen the Pakistan
economic situation further, unless reversed wisely. As already identified the
governance contributes significantly in improving the economic growth,
therefore concrete steps be initiated through institutional policy frameworks to
practice good governance rigorously, before it’s too late.
d. Strengthening Electronic. Governance through Digitalization of Services /
Institution: State’s most effective tool to execute state functions and undertake
public service delivery at grassroots levels is through the civil services or
bureaucracy. Pakistan at the time of partition in 1947 inherited the British civil
30 Hassan and Zeb
services as its administrative apparatus. Bureaucracy, was generally considered
as the engine of prosperity/growth, in Pakistan in the early decades, now turned
to repressive role and failed to deliver public services efficiently. Hence, the
need to enhance the public service delivery efficiently and implement good
governance practices through digitization of government services was felt
direly. Digitalization of government services can address the multi-faceted
governance related challenges and bring efficacy in public service delivery and
strengthen bureaucratic structures. The digitalization will build synergies
among the governmental institutions and will create a paperless culture,
enhance the efficiency of institutions and public services delivery and increase
transparency of the government actions manifold. The concept of ‘Electronic-
Governance’ is the most significant tool for achieving good governance,
especially in building accountability/transparency, improving system
efficiency and curtailing corrupt practices. Hence, strengthening Electronic
governance through digitalization of government services will bring
revolutionary improvements in good governance, reduce corruption, strengthen
state institutions and create a more efficient bureaucratic structure. E.
Governance will create a quality investment friendly environment, further
leading to improvements in economic growth and socio-economic
development. A gradually phased transformation of digitization of service
structures will not only help us to get freedom from bureaucratic hurdles and
rent seekers but will also help to build knowledge based economy to embrace
4th Industrial revolution in offing.
e. Turning Anti-Graft Drive from Rhetoric to Reality: Transparency
International ranked Pakistan 120 out of 180 measured countries on public
sector corruption in 2019. Ironically, Pakistan slipped 3 steps down towards
more corrupt countries as compared to the preceding year ranking. Pakistan,
has recurrently remained near the bottom quintile on international indices of
Transparency International and World Bank WGI for corruption.
Notwithstanding, the aggressive anti-corruption drive coupled with lot of
rhetoric, raises eye brows, when Pakistan is perceived to be more corrupt as
compared to the past year. Hence, anti-graft drive is largely perceived as more
of rhetoric based and slighter in reality based, as in the recent past steps taken
by national anti-graft body is largely perceived as “naming and shaming24, the
people with insignificant number of mega corruption cases leading to a
conclusive end. Undeniably, corruption remains a major cause seemingly
fettering economic growth, socio-economic development and retarding good
24 See https://www.weforum.org/agenda/2016/05/five-steps-to-curtail-corruption-in-
pakistan/.
Analysing the Impact of Good Governance 31
governance, therefore needs to be tackled aggressively, above the political
interferences, influences of political elite holding the reins of power. Anti-
Corruption drive should establish its legitimacy and not a grimmer perception
associated with political influences, settling personals vendetta, penalizing
opponent politicians and changing their political loyalties through
coercion/fear. As when “justice is not served” perception will prevail, the anti-
graft body will lose its legitimacy, thus making it more redundant with far
reaching consequence on the essence of “corruption free Pakistan”.
f. Building Rule of Law and Legal Order: The most effective and instrumental
prerequisite for economic growth and social development is an effective “rule
of law” and efficient judicial system. As, it is generally believed that the viably
functioning societies bears the effective write of the state and justice which is
easily accessible and available to all. In case of Pakistan the ‘rule of law’
percentile in World Bank good governance indicator ranking has never
remained encouraging. Though, the fallout of Afghan war and protracted war
against terrorism are the leading causes but still enough can be done to restore
the writ of the law in the state. Price attached with fragility of rule of law, is
cost heavy and that what Pakistan has paid in terms of loss of precious human
lives, low growth, poor socio-economic development and least focus on well-
being of the people. Formidable justice system based on vibrant legislation with
ruthless law enforcement systems without exception, and uninhibited from
exploitative interventions and politically motivated inferences augmented by
institutional capacity building is utterly needed. Establishment of speedy trial
courts, tribunals with enhancement of size and capacity of Judges and police
force for timely justice enactment will create a conducive environment for
economic growth through attracting foreign investment and societal well-being
at large. As prevalence of criminalization and wide spread corruption adds to
fragility of state and undermines its legitimacy/stability with reduced
confidence of the citizen and turning it to become a fragile state.
To conclude, although, the advent of Pakistan was a grand
manifestation of the triumph of ideology over antagonistic forces, the task of
formation of welfare oriented civil society, consequent to independence, posed
a number of challenges. The diverse strands in the country’s socio-political,
economic and psycho-cultural existence, had to be woven into the fine mosaic
worthy of a dynamic polity. Unfortunately, divisive forces and centrifugal
tendencies soon started emerging. These gave a negative turn to the course of
events and hindered smooth transition of the country out of its colonial legacy
into a well fabricated society. The prospects of an enduring political stability,
32 Hassan and Zeb
legitimacy and socio-economic development remained far from being firmly
rooted in Pakistan. The main attributes and values of ethnic, linguistic, cultural
and religious nature that normally binds the nations together also contributed
to the mutual distrust, perennial tension and perpetual hostilities.
The issues of national identity, religious-cultural accommodation and
political pluralism are not yet fully settled. These issues further complicated the
political landscape of the country by increased political pluralism and societal
heterogeneity. Absence of political insight and undemocratic behaviour of
political elites failed to prove democracy as the preferable form of government
in Pakistan which resulted in loss of public confidence in the system. Moreover,
lack of political vision by the leadership in or out of power created undesired
political vacuum for repetitive military intervention into politics. Furthermore,
the absence of effective state institutions and fragile capacity, created
governance related issue, resulting in widespread corruption and socio-
economic challenges. However, Pakistan has ample potential to rise as socio-
economically well build, moderate and progressive state. The gateway to the
establishment of a well governed, corruption free and people centric welfare
state, passes through the pursuance of good governance, well cohesive socio-
politico society and formidably build inclusive political institution.
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