The myth of Musharraf’s ‘economic boom’ needs to die

Published: January 16, 2014
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Like all myths, the fable that Musharraf was the best thing to happen to Pakistan's economy is also sustained by a crafty combination of truth and fiction. PHOTO: Reuters

A recent article ‘Have you forgotten all that Musharraf did for you, Pakistan?’ by Mr Rafay bin Ali regurgitates a popular myth – dictatorship is better for Pakistan’s economy. The author uses cross-regime comparisons based on the Gross Domestic Product (GDP) size to argue that Pervez Musharraf was the best thing that ever happened to Pakistan’s economy.

Like all myths, this fable is also sustained by a crafty combination of truth and fiction. But it crumbles once we separate the flimsy truth from the falsehood that it conceals. To do this, we must analyse the methodological flaws in the framework used by the author in arriving at this pro-dictatorship conclusion.

Once we account for these inaccuracies, democracy outperforms dictatorship and Musharraf’s economic policies underperform Pakistan’s overall average performance.

But before we get into the semantics of it all, let’s talk about using measures such as the GDP to derive insights about the standard of living. One of the elementary lessons taught to Economics students in any undergraduate class is that the GDP is merely a measure of the total production in an economy irrespective of what is actually being produced.

Thus, for instance, an economy that produces a lot of tanks and invests heavily in real estate for the rich may outperform an economy that is geared towards public expenditures on health and education in terms of GDP. To draw comparisons, therefore, it would be necessary to do a sector-wise analysis of the economy during democratic and dictatorial regimes.

First, any cross-time period comparison is rendered inadequate without constant holding prices or the effect of inflation. This is due to the simple reason that the real standard of living of a population depends not only on the absolute size of their incomes but also on the prices that they have to pay for the goods and services that they consume.

Second, it is almost criminal to use an ‘absolute’ measure of GDP to draw comparisons because such a measure fails to account for population growth and demographic shifts in the population.

The extent of the bias that a comparison based on absolute GDP size is enormous. For example, Norway, a country ranked fourth in the world in terms of GDP per capita falls to number 23 in terms of absolute GDP size, while India, ranked 133rd in terms of GDP per capita rises to number 10 in absolute size.

Based on this absolute GDP comparison, one would be led to the erroneous conclusion that India is a much more developed economy than Norway. Thus, for any comparisons to be made possible, it is necessary to use GDP per person or GDP per capita.

Third, statistical comparisons between two time periods must be cognisant of outlying years. Remember that the object of our analysis is to make sure that the differences between two periods capture differences in economic policy and governance rather than other contextually specific factors such as the catastrophic economic effects resulting from a major war. These are called ‘outliers’ in statistical analysis and objectivity demands that we exclude these from our analysis.

The year 1971, in the immediate aftermath of the regretful war in Bangladesh, is one such year and has therefore been excluded from my analysis.

Due to the aforementioned desiderata (necessity of using per capita measures, controlling for inflation and exclusion of outliers), I use GDP per capita at constant (2012) US dollar prices to compare the various political regimes across time using data provided by the UN. Using this data I calculate the growth-rates across different regimes.

The average growth rate of Pakistan’s GDP per capita at constant prices is 5.93% for the time period of 1970-2012, excluding the outlying year 1971.

The table below shows the regime-wise distribution of the growth in GDP per capita (constant prices) and the divergence between this number and the average for Pakistan as a whole.

The time periods 1970-1976 (excluding 1971), 1989-1999 and 2008-2012 are used to calculate the average value of the growth rate of GDP per capita (constant dollars) for democratic regimes while the years 1977-1988 and 1999-2008 are clubbed together to get an average value for military-rule.

Four critical insights can be drawn from the results.

First, democracy on the whole does 1.51 growth points better than military rule. GDP per capita at constant prices grew at an average of 6.71% during democratic regimes and 5.19% during military regimes.

Second, the growth rate during military regimes is 0.74 growth points below Pakistan’s average growth rate, implying that dictatorial Pakistan is not only worse for the economy as compared to democracy but it is also worse than Pakistan’s average potential of 5.93%.

Third, the average growth rate in GDP per capita at constant prices during Musharraf’s time is 5.04%, which is 0.89 points below the Pakistani average and 1.73 points lower than the average growth achieved during democratic governments.

Fourth, the highest average growth rate by regime-type is during Zulfiqar Ali Bhutto’s democratic regime followed by the last Pakistan People’s Party (PPP) led democratic coalition (2008-12), while the lowest average growth-rate was witnessed during the democratic regimes of the 1990’s.

This paradoxical performance of democracy must be seen in light of the fact that the success or failure of a regime is contingent upon the number of contiguous years that a government is endowed with to institute its economic policies.

It must be borne in mind that an economic policy, unlike a quick-relief painkiller, does not show results instantaneously. Economists are taught about the necessity of bearing time lags in mind when designing policies. This simply means that there is a lag between the institutionalisation of a policy and its results. If a policy is rudely interrupted in the middle, its results may never bear fruit.

Since different political regimes have been endowed with different contiguous-time units, it is unreasonable, or rather impossible, to make rationally sound comparisons between two regimes without taking this fact into consideration.

Remember that what we are trying to capture here is the economic performance by regime-type, which is critically shaped by the continuity of the regime. Thus, continued democracy does a lot better than the Pakistani average, while interrupted democracy does worse. This can be seen from the chart below.

Thus, it is simply not true that dictatorship is better for Pakistan’s economy.

It is equally untrue that Musharraf’s economic policies outperform democratic outcomes. Finally, as is shown through the example of the only two democratic regimes that had some semblance of continuity, democracy outperforms dictatorship greatly but only when it is uninterrupted.

Shahram Azhar

Shahram Azhar

A PhD. Economics candidate at the University of Massachusetts, Amherst, his research interests include the political economy of colonialism and developmental macroeconomics. He is a founding member of the band Laal and its former lead singer and tweets as @ShahramAzhar (twitter.com/ShahramAzhar)

The views expressed by the writer and the reader comments do not necessarily reflect the views and policies of The Express Tribune.

  • Raza

    Bravo comrade, bravo!Recommend

  • Basit

    So this piece is stating that 2008-2012 – the past 5 years of Zardari-led government were the second best economic times in Pakistan’s history and the 1970’s PPP government, which had carried out nationalization, and likely ruined this nation’s economy for a generation, was the best performing time.

    There’s something very suspicious in this conclusion drawn by the author

    I guess one can reaffirm the following 2 lessons from this – which we often tend to forget:

    1. An output is as good as its input – or as they say in America – garbege in, garbege out.

    2. Never place your faith on an advice of someone just because they may have the credentials on a subject – the outliers in viewes are always there!Recommend

  • aaaaa

    There are more competing interests in democracy which have to be satisfied to keep the democracy project going. As opposed to a dictatorship where there are very few interests, mostly maulvis and the military (and MQM). For this very simple reason, democracy is always better. Even the erroneous GDP comparison is false, as Shaukat Aziz changed the base year to make the economy look better than it actually was.Recommend

  • Haris Javed

    oh no! this will encourage baby Bhutto and his Dearest Daddy :|Recommend

  • Guest

    “The year 1971, in the immediate aftermath of the regretful war in Bangladesh, is one such year and has therefore been excluded from my analysis.”

    Very convenient exclusion, considering that one of the major causes of the war was the refusal by a so-called democrat (ZAB) to accept the results of a democratic elections.

    You should have presented the per capita GDP first in a verifiable chronological fashion and let us see which governments did what, before clubbing them into ‘averages’ where your calculations cant be verified.

    Also, your calculations and your data has to be much more throughly presented before I can be convinced that the socialist economics of ZAB were so much better than all other forms of economic policies we’ve had (military or civilian).Recommend

  • Waseem

    Very well stated. I wonder Shahram if you could exclude 1998 as an outlier from NS tenure and see how his economic policy fared? As in 1998 Pak. detenoated nuclear devices resulting in adverse effects on Pak. economy.Recommend

  • Umair

    Dude you need to recheck the numbers how on earth GDP grew by 7% from 2008-2012..it only grew around 3% on average..u hv used incorrect numbers just to impose ur thoughts i can share with you guys the link showing GDP numbers..GDP in dictatorships has been far higher.That doesnt mean m favoring dicatorship but do corrrect ur numbers atleast dont know how it got publishedRecommend

  • YasirKhan

    Ohhh, Enjoy Your Democracy Then….. Enjoy Nawaz and Zardari Quo… :)Recommend

  • Hassan Shaikh

    whole article is based on conjecture and liesRecommend

  • Abdullah al Maliki

    Western Democracy ( Govt through people’s vote) is not compatible with Islam. In Islam Allah (SWT) appoints Prophets and Rulers. Majlis e Shura nominate/ confirms rulers appointment. Voting by people to appoint Muslims ruler is not recommended in Quran and Sunnah. In Saudi Arabia there has been no peoples voting since the origin if Islam. May Allah ( SWT) show us the right path.Recommend

  • Parvez

    Spot on…..agree with you.Recommend

  • Taimoor

    A very calculated and thoughout response to Musharraf die hard fans. Thank you for this!Recommend

  • atif

    Bak was.Recommend

  • Javed

    Don’t care for Musharraf in the slightest but I live here and work in finance, and we for certain did not experience 7.56% per capita GDP growth over the Zardari regime.Recommend

  • Dr. ALE AHMED

    it
    would have been factual, had the author Shahram Azhar mentioned all the
    sources from where the data was collected and the manner it was
    complied in to reflect fiction as fact…Recommend

  • Noman Ansari

    What you are saying makes absolute sense, but then your stats show that the 2008-2012 had the second highest growth, which just seems… wrong.Recommend

  • sami

    Astaghfirullah!!!Recommend

  • saad

    I calculated GDP per capita growth for both Musharaf and Zardari period and growth during Musharaf period is higher using multiple different data fields (NY.GDP.PCAP.CD (GDP per capita (current US$)) , NY.GDP.PCAP.KD (GDP per capita (constant 2005 US$)), NY.GDP.PCAP.KD.ZG (GDP per capita growth (annual %)) ).

    Can you be more specific and mention what exact data did you use to come to your values and why they are more appropriate compared to the ones i picked ?Recommend

  • @HawaiFiring

    I’m haven’t even done O’ Levels Economics and Pak Studies, so this might sound callous. I didn’t really understand why Ayub Khans period was left out. His was a military dictatorship, and its got to be called the ‘Decade of Development’ for some reason. Secondly, how do we take out all the money ZAB got us with nationalization, which with what I’ve heard, played a fair bit in putting us on this mess. In your findings, isn’t ZAB getting an unfair advantage?Recommend

  • Fahad Zia

    Your article should be more like capitalist vs socialists.. To be fair, India tried Socialism, it failed miserably. Bhutto’s era, I cannot say about that, 08-13 2nd best ? No one in their right mind would say that.

    I dont know this accounts for inflation or not ? cause, The best eras a/c to you, had abnormally high rates of infaltion. Thanks to socialist policies (Nationalization, printing of notes for welfare w/o proper taxation).Recommend

  • basit

    So this piece is stating that 2008-2012 – the past 5 years of Zardari-led government were the second best economic times in Pakistan’s history and the 1970’s PPP government, which had carried out nationalization, and likely ruined this nation’s economy for a generation, was the best performing time.

    There’s something very suspicious in this conclusion drawn by the author who has been a member of the Marxist band Laal.

    I guess one can reaffirm the following 2 lessons from this – which we often tend to forget:

    1. An output is as good as its input – or as they say in America – garbege in, garbege out.

    2. Never place your faith on an advice of someone just because they may have the credentials on a subject – the outliers in viewes are always there!Recommend

  • Shahram Azhar

    The article is not prejudiced towards the PPP but rather highlights the simple fact that continued democracy outperforms unstable democracy.

    I have never supported the PPP. Never will.

    You can check the original data source which is provided within the article. Statistics are stubborn things.Recommend

  • Shahram Azhar

    Ayub’s period was left out because of lack of available of data. This can be confirmed by visiting this website and checking for yourself:

    http://data.un.org/Data.aspx?d=SNAAMA&f=grID%3A101%3BcurrID%3AUSD%3BpcFlag%3A1Recommend

  • Shahram Azhar
  • Shahram Azhar

    Dr. Ale Ahmed here is the original data source which is also clearly mentioned in the original article.

    http://data.un.org/Data.aspx?d=SNAAMA&f=grID%3A101%3BcurrID%3AUSD%3BpcFlag%3A1Recommend

  • Tanzeel Ahmad

    Sorry to rain on your parade my friend but a common man in Pakistan cannot analyze Musharraf’s performance through “points” you have mentioned. All what they know is in Musharrafs regime inflation rate remained stagnant, they literally witnessed revolution in banking, energy, media, education and telecom and real estate sector. They experienced development in their lifestyle through Local Govt system. Even if it was a bubble economy Pakistanis praised him for maintaining dollar rate on 60. It was his Govt when more jobs were created and dead organizations like Pakistan Railways, KESC, SSGC etc.

    From forex reserves of about $ 500 Million to $ 16 billion
    and Foreign debt from $ 40 Billion to 4 36 Billion in his era was indeed an achievement that cannot be challenged through typical blogs.Recommend

  • Shahram Azhar

    I would like to make two points here to clarify certain misunderstandings:

    1) The article is not arguing in favor of PPP but rather in favor of CONTINUED, stable democracy.

    2) I am comparing the growth across different regimes in the GDP per PERSON at CONSTANT (2012) dollar prices.

    If anyone has any doubts regarding my results I encourage them to visit the original data source (which is mentioned in the article) and check for themselves.Recommend

  • Syed Muhammad Hassan Naqvi

    it,s a pity that our phdz are so….. i have met many lioke him….. rubbishRecommend

  • Syed Muhammad Hassan Naqvi

    he’s got a good chance to be in good books of some peopleRecommend

  • Salman

    and Bhutto himself was the chief marshal law administrator. Sanity rests its case.Recommend

  • Arslan

    This is article is baseless, for I have calculated Gdp per capita growth by simply measuring amount of increase from 2000-2012, Musharafs regime was way betterRecommend

  • Ahmad Jamal Mirza

    O pai rehn day …. war gaya GDP … even people with salaries above 1 Million PKR annually are upset due to the soaring prices of fuel and the rest of the economy and in the last 5 years alone over 1 million people have lost their jobs since 2007.Recommend

  • ahmad

    HAHAHA!!! you make me laugh by showing your 2008-12 stats!!!Recommend

  • http://www.emagine-group.com/ Khalid Muhammad

    Here’s the problem that anyone who works with statistics will tell you… if they are honest.

    Statistics can be made to say whatever someone wants them to say. It’s all a matter of interpretation.

    The statistics provided by the author, upon deeper examination, show that the GDP claims made are based on derivation against current prices. When Pakistan’s economy is at its weakest and the dollar at one of the highest points in the country’s history, current prices are inflated and provide no real basis for evaluation of previous governments performance.

    Secondly, maybe the author could explain, how in a country that is suffering with massive electricity and gas shortages, which cause large industry to stop manufacturing, how the GDP is so high? If he could also point out the economic impacts of the failure of tax collection, black economy and defaulted/written off loans in the calculation of the GDP numbers that he uses to write this article.

    It is no hidden fact from anyone who lives in Pakistan that the black (illegal) economy in Pakistan is much greater than the legal one. How does that figure into the calculation and estimation of which form of government has been more successful?

    As I said, in the beginning, statistics can be manipulated to say whatever you want them to say. These have been very well manipulated.Recommend

  • Masood

    ZAB is involved to break the country into 2 , The nationalization process these are the biggest failure of ZAB and you are saying that the economy was in BOOM…plus the inflation was increased at minimal level.Recommend

  • MHZ

    Oh a pure piece of baloney!
    During ZAB’s regime the population was only 60 million. Not to mention that it was 160 mllion during Musharraf’s regime. Also, the the damage to private sector that was caused by ZAB’s policies cause an unprecedented dent to the economy.
    Also, the take over of prolific private sector organizations by ZAB had allowed his govt to manipulate the GDP figures.
    Also, the writer does not give the real GDP per capita but only the avg growth in GDP per capita. And when you are talking abt average, you also take into account the factor that There maybe huge changes in between the periods..
    Development and standard of living was visibly high during Musharraf’s era..
    Not only is this article misleading, but also the figures have not been used transparently.
    There are several other econonomic factors which need to be accounted for other than GDP.Recommend

  • Truth

    How smartly author has ignored Ayub Khan???
    The article is nothing but a piece of crap by a PPP sycophant!Recommend

  • Ibrahim

    Are you SERIOUSLY a Phd student at UMASS?? I think you should just stick to LAAL. Please quit economics cuz you don’t know jack.Recommend

  • Hasan Tasleem

    My only suggestion for this blogger is that; Hazrat Ali R A; stated “Kisi Sey Itni Nafrat Na Karo, Key Uski Aachyee Mai Bhj Tumhe Burayee Lagey.”Recommend

  • Qal

    It wound have been great if you had responded to the intellectual aspects of the argument;which is in essence an empirical argument. Recommend

  • Hasan Jamshaid

    GDP also depends upon the government spending. Pakistan got US $7.6 billion from IMF in 2008. And we received highest military aid of around US $1.3 billion in 2009 and 2010.
    This IMF loan and military aid created an artificial boom in the economy during 2008 to 2013. Corruption always create an artificial boom for a brief period. If we had not got this foreign support we definitely had negative growth rate from 2008 to 2013.Recommend

  • omer

    i have read your article and the article in response to this article was written. i do not know about finance or GDP or GDP per capita.

    Please tell that did the unemployment reduced in Musharraf’s era as shown in the other article? Did the inflation rate flow the trend as shown in other article? was dollar stable in military eras or democratic?

    Also, compare the achievements of military rule with democratic era. Mangla, and terbala dam construction. shifting of capital to Islamabad, HEC creation, etc verses metro bus, benazir income support, laptop distribution, etc.

    Because figures shown by you makes no sense to me considering the fact that from 2008 -2012 the prices of basic items doubled whereas my salary did not double during this time and the fact that the people who passed out from universities till 2007 got jobs withing 5 ~ 6 months and after 2008 getting job in pakistan got like finding needle in haystack.Recommend

  • aa

    Dear Author, As per several archives of articles that precede your analysis since 2006 up to date I have observed that you forgot to include the Purchasing power parity and the inflation rate over a period of eight years and compare the average. Just take a basket of goods, Ata, Daal, Fuel, Wheat etc also the rupee depreciation against the USD, fuel prices. I agree that stability is key to economic performance however i disagree that our democracy is in any way a progressive one, its an authoritarian one. We all are to blame, we don’t pay taxes, what’s paid is eaten up and not reflected as subsidies or incentives for key public services such as healthcare and education. Every government had its flaws, however the PPP was by far the worst in Pakistan’s history. Democracy was certainly the best revenge in terms of sucking the life out of helpless Pakistani’s. Allah please help us.Recommend

  • Basit

    Well, the problem here is that economic indicators, like all indicators, need to be taken in context and not just thrown around randomly with the hope of affirming or discrediting a regime. Unfortunately, too many writers do that in Pakistan thereby taking advantage of readers who are not aware of the details. You are looking at this from constant 2012 dollars – where dollar is taken to be approx. Rs. 100. Constant dollars, and that too after a currency devaluation of over 70 percent in past 5 years, is hardly a stat that one can make sweeping pronouncements upon. So, yes, according to this particular stat, this technically is valid. However, I would be very careful in using this measure in determining performance of govts over time. No data is independent of its intended use; and neither are there clear black or white facts. Stats are subject to errors in gathering, collection, compilation, interpretation and presentation for the sake of generalization. Go figure what’s the whole in the argument in this piece.Recommend

  • Shak-Observer

    One thing the author is ignoring is that at Economy takes a few years to get going after implementation of new rules and same is true of slow down. The apt analysis should be look at it with two year lag. Just to use US unemployment as example……it is at its highest when economy is recovering, so you can’t call it the worst time when unemployment is highest.

    For PPP government It is better to look at 2010 and on because thats two years into PPP rule.Recommend

  • Muslim

    You are pretty wrong my friend. Islam supports DEMOCRACY but not SECULARISM.
    1)Holy Prophet SAW was selected by the people of Madinah to become their leader.
    2) Harat Abu Bakr RA was again selected by the campanions of the Prophet SAW and the people. Holy Prophet SAW never decided who will be the leader after him. And Please Royal form of goverment is not seen anywhere in Islam
    3) The Secondly Caliph was again selected with consent and advisors.

    Yes a proper voting method was not conducted in those days but ISLAM DOES NOT FORBIDS you from it.
    Saudi based family governence is acutally not seen anywhere in ISLAMIC history

    SECULARISM is a completely other topic….do your research well by brother and dont be mislead by our so called street scholars…Recommend

  • Shah

    Yeah and you trying to prove tht Zardari time was better Recommend

  • Zahra Salahuddin

    makes sense!
    but I’m curious @shahramazhar:disqus, you believe in communism right? isn’t democratic socialism useless?Recommend

  • Baa

    Stats aside….in reality PK saw the biggest boom in infrastructure during the tenure of Pres. Musharraf, last time the country saw such expansion was back in Pres. Yahya days, democratic govts came and sucked the foundations of the country like leeches, they didn’t deliver anything except for fake checks, yellow cabs, loans which went in pockets of well connected, the so called democratic govts sold the nation, i am sure the current set up will sell and bury whats left of it soon. I think at this stage even the prayer may God help PK goes un-answered.Recommend

  • Anwaar

    so lets ask Allah for a ruler shall we? and dont talk about Arab .. they have Kings now … the system of which Islam was most against…..Recommend

  • Anwaar

    cant argue woth you on stats but my personal opinion is that sometimes you have to walk the streets to see how a common man is living.. . neither was it really good in Musharraf’s era nor was it any better in PPP’s…

    And I strongly agree that continued democracy is better than any dictatorshipRecommend

  • ZeeCarolina

    Incredible piece of statistical manipulation to prove a preconceived notion. We know that the GDP growth in Musharraf time was 5%-7%, and in 2008-2012 PPP time it never exceeded 3%. So by showing GDP per capita growth higher in 2008-2012 than 1999-2007 the PhD wannabe wants us to believe that the Pakistani population must have declined in 2008-2012. Wow!Recommend

  • ZeeCarolina

    Garbage in …garbage out. The loser? The garbage creator. The winner? Musharraf.Recommend

  • Afif Naeem

    Good article, but the numbers presented hereby tell me one thing. The inherent uncertainty in the adjusted GDP growth under the democratic rule. Zia was in office for about 5 years, and it resulted in 13.88% growth rate. PPP rule from 2008-2012 lead to 7.56% growth rate, while the 90’s democratic rule lead to a mere 2.06% growth rate.

    As is clear, the democratic rule is Pakistan has resulted in a range of growth in GDP. This itself points to the inherent uncertainty associated with the democratic rule. Developing countries need certainty more than anything else in the political economic sphere. Presence of uncertainty in the economic growth results in scaring away the foreign investment and long-term investment by private sector.

    The GDP growth rate under the above-mentioned military rules, even though may be called sub-power or below the potential, it at least is stable. This stability will lead to long-term investment in infrastructure and capital.Recommend

  • ZeeCarolina

    And one more thing. If the GDP growth method used by the author was so much better than the simple GDP growth then the IMF, Worldbank etc. would all be using it. They don’t and their data clearly shows how the Pakistani economy was much better off during the Musharraf era. The author would also have us believe that Goldman Sachs and other prestigious investment banks were totally wrong to identify Pakistan among the Next 11 fastest growing economies (after BRIC) during the 2002-2007 era, while during 2008-2012 moved Pakistan back to a failed state classification just as it was in the previous democratic government. You can’t pull wool over people’s eyes so simply Mr. Azhar when they LIVED through these eras.Recommend

  • bilal manj

    How has the biggest blog published such erroneous and far fetched article. This article is a dark spot on the legitimacy of the blog editors.

    And I agree Mr Laal should go back to his band although, he would have a bright future as an economist in Pakistan with the people he is supporting with this article.

    Please ban this author from spreading falsified information to the masses.Recommend

  • bilal manj
  • Hataf

    The funny thing is in comments some Olevel student is claiming that he is better than a PHD student. Seriously hate trumps everything. Evry fact.Recommend

  • ali ahmed

    the author should have mention about the poverty indexRecommend

  • gp65

    The reality is that the reserves started rising AFTER Musharraf agreed to participate in the WoT. If you review Musharraf’s performance from Oct 1999 to Oct 2001 you will find that it was pretty uninspiring.
    You are correct that there was a revolution in real estate banking and media. Not correct when you say there was a revolution in energy. In fact besides not investing in any power generation project, he also came up with a disastrous policy related to gas use including actively pushing CNG which was not sustainable. The revolution in education was limited to higher education. In a country where over 60% of women are illiterate spending money to fund Ph.D.s who study abroad seems like questionable priority.
    While Pakistanis praised him for maintaining the dollar rate at 60, he was artificially holding on to that dollar rate in the last couple of years making the adjustment when it happened very painful. Specifically rupee depreciated by 30% between Mach to November 2008 – the bulk of the period (until Aug 14 2008) he was President. This period also was accompanied by a pinfully high inflation of around 25% and a stock market crash.
    In any case, as a non-Pakistani, I am not the one who was impacted by his domestic policies. As an observer though I feel that even if Musharraf’s policies led to a great deal of prosperity, that does not compensate for his treatment of an elected PM, a former CM and of course the sitting CJ of Supreme Court.Recommend

  • Fawad

    Your 2008 -2012 stats are inaccurate. Democracy doesn’t work for Pakistan. We have suffered massive downfall during Bhutto & Zardari era. While Dictator ship is most successful for Economic growth.

    What Democracy has given to big Industries like PIA, Steel Mill. They all go down during the PPP regime. Democracy never worked for us.Recommend

  • Danish Khan

    Wonderful article and it was well due. Apparently, it seems like the dictators apologetics are having hard time to swallow it—and they have lost their faith in numbers.Recommend

  • Danish Khan

    This article is written as rebuttal to a previous article which argued that Musharaff’s era was better due to better economic performance: higher GDP, etc. First of all, GDP as a measure of human development is not the most apposite measure; but those who try to justify military dictatorship on the grounds of better economic performance always use GDP measures to assert their claims. This article has simply and eloquently refuted their claim on their grounds, i.e. GDP—excellent work by Shahram Azhar!!Recommend

  • Assad

    Well Musharraf’s tenure had the war in Afghanistan going on. Can we not use that to suggest that economic performance during his time could have been even better had the war not been going on? Not sold on this article even in the slightest.Recommend

  • SchEz Rah Abbasi

    With all due respect Shahram bhai, why is it that you always end up pinpointing Musharraf? Where do all the people who helped him reach to a position that in your opinion is devastating to the nation not highlighted? this is not the only article/ writing you have done against him. In perfect lieu of the fact that nobody had the guts to overthrow him in his time, and half of the democratic lot was there in his so called erroneous time frame are still ruling, why are you so biased towards that ONE person? you mean to say that in the whole nation of millions, not one had the guts to sabotage his reign THEN,whence all they do is blaze their guns at him NOW?Recommend

  • Dr. Mazhar Mughal

    Using GDP per capita (constant US$) from World Bank’s Open Database, the following growth rates are obtained for the

    period 1961 – 2010. Wise readers can calculate averages for various regimes themselves. For wiser readers, even a cursory

    glance should suffice:

    1961-1970

    3.478697713 1.957640272 6.014993298 4.884691744 7.628611002

    3.081479238 2.665918754 4.417684146 2.7086825 8.368543969

    1971 – 19880

    -2.249527309 -1.945886411 4.077783109 0.572142159 1.129030834

    1.95588299 0.707993043 4.606146419 0.386423888 6.573822014

    1981 – 1990

    4.308543114 2.94397062 3.171899147 1.53616814 4.019508353

    2.03815143 3.007716159 4.232426534 1.781662747 1.448209563

    1991 – 2000

    2.205504876 4.931160619 -0.781037165 1.153293517 2.304562542

    2.127448578 -1.633038941 -0.093193765 1.126366145 1.907473743

    2001 – 2010

    -0.115605882 1.268932503 2.975426265 5.494705386 5.776949637

    4.292233602 3.798653249 -0.222250832 1.740840474 2.28504234

    (Hint: Note how many years out of the total fifty had a growth rate of 5% or above and when did those occur).Recommend

  • Pakistan

    absolute crap… i expected better from Laal.Recommend

  • K Alam

    but still u could have other sources of published data?Recommend

  • K Alam

    Dear, as per your advise i downloaded the data from the UNDP……however it portrays another aspect of growth i.e. during the period 2008-2012 of PPP, the GDP saw an increase of 32.7 percent, however when we compare the Musharraf era 1998-2008, it was almost double i.e. 60 percent. Furthermore if you see the growth in total GDP during 2002-2008, it is 73 percent………Recommend

  • Shahram Azhar

    It would be great if you could respond to the intellectual and methodological aspects of my discussion rather than making uninformed and prejudiced remarks.Recommend

  • Shahram Azhar

    As I have stated clearly numerous times this is growth in GDP per capita at CURRENT (2012) $ prices. The data is from UN and a link is available within the article.Recommend

  • Shahram Azhar

    The only conclusion that I have drawn is that democracies which have some semblance of continuity (such as 70-77 and 08-12) perform better than dictatorships and unstable (1990’s) democracies.

    The numbers are from UN. If you don’t like them file a complaint in the International Court of Justice against their number crunching.Recommend

  • Shahram Azhar

    I am glad. The only issue is that they are not “my” numbers but numbers given by the UN.Recommend

  • Shahram Azhar

    You need to calculate GDP per capita growth at CONSTANT (2012) prices. Data source is UN and is embedded within the article.Recommend

  • Shahram Azhar

    The problem with democracy in 90’s (as I point out in the article) is lack of continuity. As I have shown in this article CONTINUED democracy outperforms dictatorships and unstable democracy.Recommend

  • ” just seems… wrong” : a whole new type of academic argument!Recommend

  • as

    An illogical article by a socialist ideologue. Can my dear friend tell the loans taken from 1947-2007 and from 2008-2013 is equal i.e. meaning it has doubled plus from 1947-2007 2.6 million went abroad for greener pastures which from 2008-2013 in this democratic era stands at 2.7 million staggering fig. Fig quoted from tribune article as figs quoted by Min of Overseas Pakistanis. Now you decide what is better. I think you know my answerRecommend

  • Zaq

    Dear Arham,

    It’s easy for you to sit in the US and do all the calculations, and for me even in Australia, the brunt is being faced by the common man in Pakistan. Let’s go and be a part of the system to prove your point.Recommend

  • Ya-Hussain

    forget economic boom , how about science and development boom ? Maybe you wanna read Dr.Atta.ur Rehman’s recent article ?
    Please don’t act like a cult member of Marxism .Recommend

  • Pharell

    “Never place your faith on an advice of someone just because they may have the credentials on a subject”

    I would rather listen to this guy, with a PhD in Economics, than the software developer who wrote the pro Mushi post.Recommend

  • Motiwala

    No, statistics are not stubborn things. But if the author used
    smoke and mirrors and invented some due to his political
    persuasions then it is a different matter. Political parties always
    blame others. never admit someone else did a good job. A few P’s
    and some obfuscating D’s after a name proves only that the author’s
    theory is good for kitchen table chit chat. On a slow normal day.Recommend

  • Saad Hasan

    Given that the author is much better qualified than I am on the subject, i would refrain from deriding him. However, I cannot for the life of me wrap my mind around the averment that the GDP per capita rose during the Zardari led administration. I am no maths wizard and I smatter in economics but I believe I am correct in presuming that for GDP per capita to increase, either of two things must happen: 1) your GDP increases as a whole or 2) your population decreases. Acknowledging the absurdity of the latter cause’s application in Pakistan it can be discounted.

    Now, please enlighten us on how the GDP in Pakistan has grown during this time when a substantial part of our industry has closed shop including most of the textile industry with Faisalabad being the most affected. “Lack of electricity has crippled our business” is a quote you’d hear from a factory owner, shop vendor, software firm proprietor and just about anyone involved in business in Pakistan. Stuff isn’t made; stuff isn’t sold and money is not made and money is not spent. You don’t even need a Phd to understand that.

    If foreign aid increases GDP then your argument could be plausible. I cannot stand Musharraf but even I won’t deny that he while being repugnant to all norms of democratic principles which I hold dear, was a positive for Pakistan’s economy and at least poverty per capita was lower.Recommend

  • Mehdi

    Then isn’t drawing the final conclusion by eliminating Ayub Khan from the equation a bit unfair to the military rule? Just saying. We all know that Ayub’s times were far more fruitful as compared to several democratic regimes. If you want to label something under “dictatorship”, then leaving out Ayub’s era is like leaving a huge chunk behind; which is quite unfair to be honest.Recommend

  • Shahram Azhar

    If we account for foreign aid received you will find that military governments do even worse. Look at this:

    https://twitter.com/ShahramAzhar/status/423957872498601984/photo/1Recommend

  • Shahram Azhar

    I personally do not believe that GDP is a measure of development. My article merely sets the record straight: even if one believes that GDP is a great measure, with the right methodological framework one arrives at the conclusion that continued, stable democracy outperforms dictatorships and unstable democracies.

    Second, your interpretation of the variable GDP per capita at constant dollars is incorrect. The UN data converts GDP per capita in domestic values into dollars AT EVERY GIVEN EXCHANGE RATE and then uses 2012 (current prices) as the base year. This makes sure that differences between years capture differences in purchasing power parity rather than exchange rate differentials as you have incorrectly stated.

    I hope this helps you understand the article better.Recommend

  • Norman

    … If only GDP per capita that too on current prices was the right measure to judge economic growth.
    Not a supporter of dictatorship or development of Mush era.

    Thanks.Recommend

  • NA

    Actually, @gp65, there was a revolution in education. One of the first things that Shahbaz Sharif did in 2008 when he was re-instated as CM Punjab was to abolish the free education program set in motion by Pervez Elahi. SS’s education plan was free laptops, whereas PE made education mandatory and free for all of Punjab. It was a first step in what would have completely changed the landscape of Pakistan. Our ‘democratic’ governments don’t seem to want that, for some reason.

    The ‘elected PM’ that Musharraf removed had just stormed the Supreme Court, illegally dismissed Sajjad Ali Shah as the Chief Justice, demolished our economy and was about to declare himself ‘Amir-ul-Momineen’. When he was removed, the whole country rejoiced. We have short memories, so you won’t remember those times. It was a year after the nuclear blasts and Nawaz Sharif was under the impression that he could get away with anything.

    The sitting CJ, by the way, was removed by Musharraf as per Constitutional requirements (reference filed and submitted to the SJC), unlike Nawaz Sharif’s arbitrary removal of Sajjad Ali Shah. If the lawyers and political parties had not rioted, Iftikhar Chaudhry would most likely have been found guilty of petty theft and nepotism – such great qualities to have in the highest Judge of the land. As it is, 5 years on and everyone who supported the CJ is regretting their part in that particular debacle, including Ali Kurd, Aitzaz Ahsan, Imran Khan and Asma Jehangir. The lawyers who initially brought the reference against the CJ have now all been vindicated, but no one cares – it isn’t as sensational as having a ‘lawyer’s movement’ marching through our streets, or as fun as bringing down a ‘dictator’.

    Finally, to all those who continue to call Musharraf a ‘dictator’, you obviously don’t remember Pakistan under Zia, or you would never call him that. Zia’s rule was definitely marked with inflated and artificial economic indicators, unlike Musharraf’s, whose tenure (and economic policies) was ably handled by Shaukat Aziz. Zia is also largely responsible for bringing the WoT to our doorstep. Without his support of the Afghan conflict and his deep relationship with the CIA, he would never have ruled for 11 years, and the Taliban would not be living among us.Recommend

  • NA
  • Deen Sheikh

    Oh Look another Jiyala of the PPP, are you doing your PhD on our Tax payer money?Recommend

  • Zaka

    You are wrong. Pakistan was able to raise reserves to more $ 3 billions before 9/11, these reserves were stood at $0.6 billions when Musharraf took over in 1999. More importantly debt remained stagnant at $ 38 billion during the entire Musharraf rule. Common man was at ease during that period too.Recommend

  • Umar Zakaria

    I beg to differ. For the ppl, only success is that is seen through employment and development and number of services being provided to the citizens. That tend to increase in Mush regime
    (Not a Mush Support)Recommend

  • HS

    The author is determining the growth by keeping the GDP per person ($) as constant. His results are far from reality. I for one strongly believe that a successful dictatorship is far better than a failed democracy. And I don’t remember a time at least in my lifetime that we ever had real democracy.Recommend

  • HS

    Solid rebuttals.Recommend

  • Atif Nawaz Khan

    I agree with your article, but Dictatorship in uniform is way better a disguised in the form of Democracy.Recommend

  • Shahram Azhar

    I excluded the year 1972 (not 71). Remember that the war ended in 71′ December, and its impact could be seen in the year AFTER (since GDP/capita constant $ are reported from December-December in UN data).Recommend

  • Noman Ansari

    Thank you. It as been trademarked. You owe me two rupees.Recommend

  • Noman Ansari

    “Even if it was a bubble economy Pakistanis praised him for maintaining dollar rate on 60.”

    The way you say ‘even if’ makes me laugh.

    That’s like saying, he was having a great time even if he was scheduled to suddenly die from cancer in a few years.Recommend

  • Baba

    Its funny Shahram that you dont even reply to people who gave you actual ‘intellectual’ arguments.
    I wonder why you are still a candidate of PhD and haven’t got it yet coz you tend to ignore whats more importantRecommend

  • hara

    The data is obviously flawed. PPP governments have been caught falsifying economic data to international institutions on multiple occasions. If we believe the linked numbers, Pakistan’s GDP grew 27.53% between 1973 and 1974. And Bhutto doubled per capita income in 4 years. These are not facts, this is a joke.
    Even if the data is to be believed, your whole schpiel about what you call “lag” between policy implementation and its affect on the economy contradicts the point you’re making by presenting these numbers: that democracies perform better. By this logic, Bhutto’s (fictitious) growth can be credited to Yahya Khan’s policy.

    Musharraf’s supporters do not only point to GDP numbers to make their case. They point to every single economic indicator known to man, all of which pointed in a positive direction.Recommend

  • Rahul Razdan

    ” Military rule outperform democracy in economic terms”. These kind of claims are usually raised by ultra nationalists who usually show Stalin’s Russia and China as examples. But what India and Pakistan has is a vibrant civil society which can take the whole nation forward without military intervention. But military coup is like formatting the hard drive. Every time you do it , you reduce the performance of the hard drive on the whole. In case of Pakistan , every time a military coup happens, the political establishment are forced to tow the line of military for the sake of survival and hence the military becomes a major player in charting the economic decisions of the country and hence by trying to monopolize market through cronies or edge out competitors. The boom that is usually seen during military rule largely benefits the cronies and banks are forced to make bad loans which fuels the speculative part of economy like real estate and hence overheating the economy, which in turn leads to inflation which inturn is an indirect taxation of citizens.Recommend