Escaping the past

PAKISTAN’S history is not without genuine ‘structural reforms’. But the term has become a cliché; it earns its meaning against one parameter — ‘productivity’. At different moments, under governments of every complexion, the state has built its productive capacity, given itself a constitutional architecture that endures, and rebuilt entire sectors to a standard the region envies. The achievements have been real; but almost none proved permanent.

The useful question is not who reformed but why reforms never lasted. They were instituted, as in the rest of the world, when the leadership enjoyed, or believed that it enjoyed, long horizons of authority; when design was delegated to capable technocrats shielded from daily politics; when power sought legitimacy through performance; when geopolitical alignment became a financing runway; and when vested interests were taken on, albeit with mixed results.

Now consider what died, and why. Reform was repeatedly legitimised through persons, so its authority expired with them; durable documents soon became unbalanced, and the gains faded with their chapters. Delegation to technocrats was by grace and revocable at will — in fact, it was a loan of authority, and never a grant. Here, I believe, lies the most crucial reason why reforms never lasted: never owned at the grassroots, where acceptance is won, reform remained an expert project without a constituency. Underneath, every growth model rested on accumulating capital and attracting inflows rather than raising productivity. As a result, growth stalled when external financing did.

That lesson is the headline. Decompose our growth over the past quarter of a century, and the contribution of productivity stands at nearly nil. The economies that escaped comparable positions did the opposite. South Korea forced its firms into world-market discipline. Vietnam fixed its fundamentals and then, through foreign investment, absorbed the process discipline of the world’s best manufacturers — importing productivity itself. That unclaimed Vietnam moment is passing through our region; it will not wait. Where competitiveness is concerned, energy and productivity, and not the currency, are the controlling interests.

The entrenchment of structural reforms remains the name of the game.

History also settles measurement. Each era proclaimed success in headline arithmetic while households experienced otherwise. In the latest cycle, growth per head ran at a third of the celebrated headline, and the poorest two-fifths ended a five-year stretch below where they began. An honest scorecard — a welfare-based GDP that measures per capita growth through income families actually receive, adjusted for distribution and the prices the poor pay — is not a statistical refinement. It is a political technology, making it impossible to declare victory against the lived experience of the majority.

That scorecard disciplines the present, too. In this IMF-anchored stabilisation phase, basic productivity reforms belong to the fiscal front where what I call the leaking fountainhead drains savings into cash, informality and the deficit, leaving the pond of private credit dry. And whatever fiscal space stabilisation yields must reach the micro level through that credit, down to the lowest strata, where welfare-GDP is still in the red, although it has improved over the last four years.

So what does the record prescribe? Four inversions.

Vest legitimacy in bargains, not persons: A charter of economy is needed to lock in a handful of protected items — such as the tax base, energy pricing, state enterprises, human capital — for a decade through parliament and the Council of Common Interests (CCI). It should rest on a ‘charter of society’ in which fair taxation and functioning services are the state’s responsibility in return for the citizens’ willingness to document. Within that compact, and building on expert advice, implementation belongs to whoever is closest to the grassroots. Administrative and financial devolution is how proximity is created: China built its escape on it.

Expert design, grassroots delivery, societal acceptance: This should constitute the ‘charter of society’.

Delegate by statute, not courtesy: The central bank’s autonomy — the one delegation to survive successive governments — should be transplanted clause by clause into other regulatory frameworks, with empowered independent regulators established where needed.

Measure honestly: Make productivity the test of every measure. A reform that does not raise the productivity of our capital, labour, land, firms or state is merely ornamental.

The final lesson is the most practical. Our failed eras built new institutions, each of which perished with its patron. Our durable achievements hardened things that already existed. The prescription is conversion, not creation. The CCI should be convened quarterly with the economic agenda it already owns. The state enterprise law must be enforced through a single ordinance. The statistics bureau should publish a ‘welfare GDP’ based on the data it collects. Every IMF benchmark should be legislated ahead of the deadline so that discipline outlives the programme. And accountability must be made predictable, for until political defeat is survivable no charter signature is credible.

The entrenchment of structural reforms remains the name of the game.

Each conversion turns one discretion into one rule, anchored deep enough to outlast electoral cycles, while 10 converted discretions are a quiet revolution that never needs to announce itself. Greece is the proof: it legislated its way out of crisis, digitising the state and hard-coding fiscal rules, and returned to investment grade without a single triumphal announcement.

Our reforming eras had authority in search of a purpose. The record prescribes the reverse: a purpose — national productivity in the service of household welfare — with an architecture built to outlive its builders. History repeats itself when windows of opportunities are wasted on managing crisis. It breaks out of the cycle when the architecture itself becomes the focus. A window of opportunity is open now and that is the choice before us.

The writer is a banker.

Published in Dawn, August 21st, 2026