Undoing exclusion

LACK of equal opportunities and innovation has suffocated the growth capacity of Pakistan, limiting investment to buying and selling of real estate and dollars by the elite. Inequality of opportunity (IOp) evident across provinces, gender, religion, and the rural-urban spectrum presents itself as a major impediment to growth in Pakistan. This IOp largely stems from poor governance and exclusive institutions that have over time perpetuated the culture of elite capture. It is an endemic situation that mars society by curtailing social mobility, thereby killing all incentive for development.

IOp across gender keeps women at the sidelines, excluding them from work and education prospects. Statistics from the World Bank show that of the 22 million out-of-school children in Pakistan, 12m are girls. Of those going to school, learning outcomes remain poorer for girls compared to boys due to lack of focus. Access to work opportunities also remains disproportionate for women.

The Labour Force Survey [LFS] 2021 shows that female labour force participation stands at a depressing 21.4pc; of this, around 94pc women are employed in the informal sector. Owing to cultural norms, female workforce participation goes down as household unpaid care responsibilities mount. Using the Pakistan Social And Living Standards Measurement Survey 2014-15, we can see that on average, the number of weekly hours worked by women goes down by approximately 4.5 hours once they become mothers. This translates into widening pay gaps over the years, simultaneously isolating women from leadership positions.

IOp is also blatant across provinces: statistics from ASER 2021 show that learning outcomes remain poorest for Sindh, closely followed by Balochistan. This finding is mirrored in LFS 2021 which shows that 56pc people in Balochistan, and 46pc people in Sindh cannot read a simple sentence in any language with understanding. According to Unicef, 52pc of the poorest children in Sindh (58pc girls) are out of school; meanwhile in Balochistan, 78pc girls are out of school. Within provinces, an urban premium exists that favours those living in urban areas.

Policymakers need to take measures that help bolster economic growth through inclusivity.

The recent cable car incident at Battagram highlights the hypocrisy of living in a country where on the one hand, inadequate infrastructure in poorer districts puts lives of school-going children at great risk; in contrast, you have cities like Lahore where multiple projects have been aimed at reducing commute time to the motorway. This bifurcation has increased the incidence of rural-urban migration, thereby resulting in a concentration of population in major cities. Using LFS 2021, we can see that around 58pc of all migrants have moved to Punjab in search of better health, education, and employment opportunities.

Favouring certain groups based on circumstances that are beyond one’s control is an impediment to growth. It disincentivises individuals from investing in entrepreneurship and human capital formation. In a country where around 31pc of university graduates are unemployed, lack of opportunities becomes a major cause of brain drain.

Exclusive financial institutions have inhibited entrepreneurial endeavours by limiting credit services to richer segments. Unless policymakers divert attention towards equity, the potential of Pakistan’s significant youth bulge will go to waste for lack of equity. The youth of Pakistan is reeling with passion without direction. Lack of opportunities has turned this asset into a ticking time bomb leading to great displays of intolerance and violence recently, such as the Jaranwala incident.

The biggest challenge for the incoming government lies in creating a just playing field for all irrespective of gender, age, religion, etc. Policymakers need to take measures that help bolster economic growth through inclusivity. We can never achieve sustainable growth in a country where more than half the population is inhibited in their capacity to contribute productively. Particularly, oppression of women is a coordination failure with unprecedented ramifications. Internalised misogyny and gender-based inequalities need to be addressed by combating cultural norms through policy, media, and most importantly, education.

Inclusion warrants policies that promise high returns at initial levels for marginalised groups so that they have a greater incentive to continue to pursue education, work, and entrepreneurship opportunities, thereby increasing social returns. This is pertinent so that people with fewer resources, or those stuck in inopportune conditions can work their way out of their adversity.

The goal should be to ‘enable’ marginalised groups, rather than to aid them unsustainably. This includes policies such as incentivising work-from-home models by providing tax breaks to bus­i­­nesses that facilitate it. This will make empl­oy­m­ent opportunities accessible to women and to persons living in indigenous regions. Remote learning opportunities also need to be created so that equitable education levels can be ensured for all. The biggest challenge in this regard will be to over­­come the great digital divide which can be ach­­ieved through public-private partnership. Ov­­ercoming the digital divide is also crucial to allow us to fully reap the benefits of artificial intel­lige­n­­ce, such as for education and health endeavours.

Additionally, financial inclusion needs to be ensured by creating incentives for women to open bank accounts and by making credit facilities readily available for marginalised groups. For this, it is vital to formalise the undocumented sector; however, it should not be done under the purview of raising taxes, but rather to support entrepreneurship by facilitating, counselling, and encouraging new business ventures. Instead of directing tax breaks and subsidies towards the same old cronies, subsidies should be given as a reward for innovation to new and emerging businesses. In conjunction, an impartial mechanism for registration of trademarks and copyrights should be ensured. Lastly, social programmes need to be expanded to ensure decent basic standards of living. In short, inclusivity is key to achieving SDGs by 2030.

The writer is a senior research associate at the Sustainable Development Policy Institute, Islamabad. The views are the writer’s own and do not reflect the SDPI’s position.

Read more