Democracy, Inclusion and Governance: The Inseparable Links

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(Pakistan has oscillated between military rule and some form of democracy throughout its chequered political history. Several factors, widely discussed in political literature, are responsible for the shallow roots of democracy in Pakistan. The root causes, however, are exclusionary policies of the state, politico-economic arrangements benefitting the elite, and outmoded governance structures from colonial times. Empirics suggest that democracy per se has no effect on economic growth, corruption, and inequality. Its benefits accrue to the citizenry through good governance, cost-effective public service delivery, and rule of law. There is a clear nexus between inclusion, good governance and democracy.   Reforms of fundamental nature are needed to disperse the economic and political power in society to sustain democracy. The main areas of reform identified in this regard are the civil service, local governance, taxation and education. Author)

What ails the political system of Pakistan? What explains the fragility of its democracy? These questions are far from trivial. Pakistan has experimented with various forms of political systems: presidential, parliamentary, guided democracy, etc. It has oscillated between military rule and democratically elected regimes since itsinception. It is estimated thatout of total 24,488days, Pakistan had democratic regimes for 8,781 days while for 8,503 days military ruled the country[1]. A consistent pattern is visible in the political history of Pakistan. Oncethe military takes over, struggle for a rocky and uncertain transition back towards democracy starts. Why political institutions are so sclerotic in Pakistan and why these institutions have failed to nourish democracy is a big question. Some generalized and partial explanations discussed in literature on the issueare as follows:[2]

1) Mr. Jinnah did not live long after the birth of Pakistan. Due to his demise, soon after the independence, he did not have time and opportunity to impose his vision on Pakistan unlike his Indian counterpart, Mr. Nehru, who had enough time to put India on the trajectory of democracy. It is argued that Mr. Jinnah was a modern, secular and liberal leader who wanted to lay the foundations of the country on the modern principles of democracy and secularism but his early demise did not let him translate his vision into reality. “The death of Jinnah in the state’s infancy created confusion over whether Pakistan should remain secular or should follow the momentum for Islamization generated during the independence struggle. The lack of strong leadership with well-defined vision deepened the confusion, and to this day the country struggles to achieve a clear vision of its future”.[3]

2) It is also argued that the majority of the elite who played an active part in the ‘Pakistan Movement’ had migrated from the minority provinces of India. These elite did not have indigenous political and economic roots and were, therefore, reluctant to initiate a democratic process.

3) The political leaders of the Western part of the country were fearful of the domination by the politicians of East Pakistan in the legislature due to their supremacy in numbers. Had democracy been the choice, it was very likely that the politicians from the Eastern part would form governments and run the state affairs by virtue of their majority.

4) Low level of capitalist development and industrialization is also held responsible for the shallow roots of democracy. History of evolution of modern democracy in countries like the UK bears testimony to this argument.  Industrialization became a big driving force for liberal democracy in the Western World. There is a strong thesis by political economists that in UK extension of franchise to the labour and middle classes was a strategic decision on the part of the elite, who were fearful of revolution due to changed socioeconomic conditions unleashed by the Industrial revolution[4].  In case of Pakistan, power shifts did not take place between various classes and segments of society due to a low level of industrialization.

Political and economic power remained concentrated in the land owning elite who already had access topower, privilege and authority. They did not need democracy to get their rights. Rather democracy could be a threat to their power due to the voice democracy gives to the common people who could challenge the existing power structures and demand their share of the pie. A majority of the population lived in the rural hinterland and elections were decided (and still so) by rural Pakistan. Even if there was an urge among the rural people for their political and economic rights, which only a real democracy could bestow upon them, theywere faced with what the economists call a collective action problem.[5]Most of the people were dependent on the landed elite for their livelihood and access to public services from local institutions.

5) Civilian bureaucracy and military were comparatively two well-organized and powerful institutions immediately after the independence of Pakistan. They thought that they could take Pakistan forward towards economic progress as the politicians lacked the necessary vision and will to put the country on the trajectory of development. These reasons for fragility of democracy in Pakistan are true to a large extent but do not complete the story.The roots of fragility run much deeper than generally understood.

Democracy is more than Elections

Before delving into the causes of the fragility of our political system, let me briefly state as to what makes democracy a superior form of governance or what are the advantages of democracy. Professor Jared Diamond, in one of his recent articleson American democracy, has emphasized the following virtuesof democracy:1) Democracy encourages debate and even seemingly unpalatable ideas can be discussed in democracy; 2) Citizens have a voice in democracy. They are heard. Democracy acts as a safety valve against violence and frustration; 3) Democracy acts as a shield against tyranny and oppression. A spirit of compromise and accommodation is its hallmark; 4) In democracy all citizens can vote, so governments are motivated to invest in the people at large rather than the few elite.[6]

So democracy empowers people. It gives them voice. It does not safeguard the interests of the elite alone. But the questions here are: Is democracy just a political concept? Has it nothing to do with the economic and social lives of the people? Is the principle of ‘one man one vote’ sufficient for the sustainability of democracy? DrB.R.Ambedkarsaid, “On the 26th of January, 1950, we are going to enter into a life of contradictions. In politics, we will be recognizing the principle of one man one vote, and one vote one value. In our social and economic life, we shall, by reason of our social and economic structure, continue to deny the principle of one man one value. How long shall we continue to deny equality in our social and economic life? If we continue it for long, we will do so only by putting our political democracy in peril. We must remove the contradiction at the earliest possible moment, or else those who suffer from inequality will blow up the structure of political democracy.”[7]

Democracy is more than elections even if they are held on the principle of one man, one vote. Real and sustainable democracy is not possible without appreciating its economic and social aspects.One of the prime reasons for the failure of democracies is that too much emphasis is put on elections and too little on other essential features of democracy[8].Meritocracy, rule of law, good governance, and accountability, which should be the defining features of a democracy, are often lacking in developing countries like Pakistan. That is why democracy stumbles again and again.Professor DaniRodrik of Harvard University says, “When democracy fails to deliver economically and politically, perhaps it is to be expected that some people will look for authoritarian solutions. As long as the military remains the ultimate arbiter, these groups (political) focus their strategies on military rather than on one another.”[9]

Sustainability of democracy mainly depends on its capacity to incorporate more societal sectors and distribute public goods among the citizenry.  The extent to which the system makes itself inclusive with the passage of time is the real test of democracy in a country. History of the evolution of democracy testifies this assertion.  For example, the evolution of democracy in the UK not only gave the disenfranchised sections voting rights,but also initiated broad based reforms in the 19th century by Prime Ministers Disraeli and Gladstone (though belonging to different political parties) in the spheres of education, public health and social security.

Pakistan’s situation is quite paradoxical. Rather than making the people stakeholders in the democratic system,we have tried to keep the base of the democracy narrow throughexclusionary policies and perpetuation of the status quo. For example, local governments that could disperse political power in society have not been established. Similarly, no effective land reforms were introduced to disperse economic power. Concentration of land in the hands of a small landed elite has had long-term implications for the growth of political institutions and democracy in the country. Institutions generally evolve and become stronger in comparatively egalitarian societal arrangements. India made effective land reforms soon after independence. Land reforms were also vital in the initial stages of development of South East Asian countries, now called Asian Tigers, at least from three angles[10]. First, land reforms enhanced rural productivity and income of the rural people. Consequently, domestic savings increased. Second, higher incomes resulted in higher domestic demand for goods. Third, redistribution of income contributed to political stability, an important factor for creating an environment for domestic and foreign investment.

The distribution of assets and income was thus highly skewed from the very beginning in case of Pakistan.No serious efforts were undertaken by the state to smoothen the inequitable distribution of assets through redistribution. The literature on redistribution under democracy gives some very useful insights which may explain, though partially, the fragility of democracy in Pakistan.Empirics suggest that if redistribution is insufficient for the poor or excessive for the rich, people may turn against democracy. A threshold of capital stock is required for democracy to survive.  Perhaps we have not yet achieved this threshold of capital stock and perhaps it partially explains our low level of patience with democracy.

Democracy, what is it good for?Some empirics

(a) What is the linkage between democracy and income?Empirics suggest a direct relationship between per capita GDP and democracy, meaning rich countries have more probability to be democratic than poor countries: “The probability that a democracy would survive rises steeply in per capita income. Between 1950 and 1999,the probability that a democracy would die during any year in countries with per capita income under $1000 (1985 PPP dollars) was 0.0845 so that one in twelve died—and no democracy ever fell in a country with per capita income higher than that of Argentina in 1975, $6055.This is a startling fact,given that throughout history about seventy democracies collapsed in poorer countries, while thirty-seven democracies spent over 1000 years in more developed countries and not one died”.[11]

Several other economists have also suggested a strong link between income and democracy.  According to Professor Robert J. Barro an increase in living standards is certainly associated with gradual rise in democracy, and the democracies without economic development fail to sustain. Economic development, argues Samuel Huntington,[12] has a positive impact on the process of democratization.  He further argues that when a nation reaches a given threshold of development, it is likely to become a democracy. Slow development means slow transition to democracy whereas rapid development creates tensions in the society which eventually lead to broader political participation.

Some have, however, questioned this thesis. Professor Acemoglu et al[13] have suggested that although a relationship exists between income and democracy but as to whether income contributes towards democracy is questionable. Peculiar history and development paths and not income explain the adoption and sustainability of democracy in a country. If the thesis of Professor Daron Acemoglu et al is accepted, then it means that we have little space and leverage to sustain democracy due to historical determinism.Interestingly, ‘democracy-development tradeoff’does not hold in the case of Pakistan.The economic growth rate during military rule was above 6% while in democratic regimes it hovered around 4%. Economic growth has been successfully achieved during the authoritarian regimes but this growth neither enhanced democracy nor reflected itself in the lives of the people.

(b)Does democracy reduce inequality? Ideally democracy should take care of inequality as democracy means rule of the majority and if everybody has got the right to vote, then it makes sense that people will vote for redistribution of resources from the rich to the poor. If it happens, social and income inequalities of extreme nature should eventually go. But contrary to this, democracy does not necessarily reduce inequality. Extreme economic and social inequities persist even in long-established democracies.  USA and India are cases in point. In USA, inequality has emerged as a big issue despite a well-established democracy.[14]According to an Oxfam report,Income inequality has also deepened in India, in the last three decades.[15]

Why democracy does not necessarily reduce inequality? Daron Acemoglu et al have identified several channels for the limited impact of democracy on inequality.[16]First, democracy may be ‘captured’ or ‘constrained’. Though democracy reallocates de jure power to the poorer segments of the society by giving power of vote on the basis of universal franchise but de jure power does not necessarily mean de facto power as well. The political system does not work for the majority due to the control the elite have over political parties, lobbying, provision of funds for electioneering, local law enforcement agencies, etc. In a developed country, like the USA, the political system may be influenced by corporate interests and lobbies, whereas, in a developing country like Pakistan, the democratic system may be hijacked by the feudal or ethnic interests.

Second, democracy does not necessarily transfer power to the poor. Rather it may transfer political power only to the middle class. Inequality can only be reduced if the middle class is in favour of redistribution. In a real democracy, the taxation system is supposed to be highly progressive with a major component of the total composition of taxes being direct taxes. A substantial amount of revenue also has to be allocated for primary health, basic education, transfer payments, etc. instead of big health projects and tertiary education.  This, however, is usually not the case, especially with democracy in Pakistan.

(c) Does democracy contribute towards economic growth? Not necessarily. The empirics exploring the impact of democracy on economic growth indicate that either democracy is detrimental to economic growth or at best it is neutral. In this regard, the first forceful paper that explored the relationship between economic growth and democracy was that of Professor Robert Barro.[17] Based on an analysis of about 100 countries, he found that democracy reduces economic growth. Professor Paul collier has even argued that authoritarianism can be good for economic growth. The debate that economic growth is related to ‘regime-type’ is gaining lot of attention even in developed democracies. China’s impressive growth rate in the last couple of decades has ignited this debate in the academic and policy circles of the West. Is it a coincidence that some of the best growth experiences of the world have been either under dictatorships or in less-than-democratic regimes? Post-Mao China, Lee Kwan Yew’s Singapore, or General Park Chung Hee’s South Korea may be cited as some examples.

Why economic growth may be compromised in a democratic dispensation? The argument isthat in a democratic dispensation the government is under persistent pressure from the electorate for immediate consumption at the cost of long-term investment. The political parties have to have recourse to the people for elections and to stay in power. If the government prefers long-term investment over immediate consumption, it may not have ‘sellable projects’ for elections, and has every likelihood to be voted out.This argument can also be constructed as follows: poor have high propensity to consume. If they are organized then they demand high wages and immediate relief through transfers and subsidies. Consequently, profits and investment are reduced and in turn economic growth slows down.  The flipside of this argument is that if a government is a true representative of the people and reflects the preferences of the majority in the real sense, then it will take measures for more progressive taxation and redistribution which in turn will increase the spending capacity of the poor. Resultantly, aggregate demand will increase and hence economic growth. Even otherwise, economic literature says that democracy per se has no effect on growth. Accountability, good governance and reduction in corruption will impact growth. A fragile and weak democracy, however, does not necessarily guarantee good governance and accountability.

(d) Does democracy reduce corruption? Not necessarily at least in the short-run. Economists say that the relationship between democracy and corruption is somewhat complex. The relationship between democracy and corruption can at best be described as an ‘inverted U’ relationship.  In the beginning the corruption level in a democratic regime goes up, then stabilizes and eventually falls when the norms of democratic accountability and rule of law are established. It happened in the case of UK where dismantling of what was called ‘old corruption’ took several decades but as the franchise expanded and democratic norms evolved, misuse of public office for personal gains became less likely. Democracy in developing countries, however, has not clearly proven more successful at tackling corruption. India is a case in point where corruption is rampant despite a well- established democratic system of governance since almost seven decades.The track record of democracy in controlling corruption in poor and developing countries is not better than that of an authoritarian development state.[18]These empirics about democracy are mind-boggling.

The people can get disillusioned if they do not consider themselves stakeholders in the system.The problem with democracy is that it may be of many stripes. FareedZakaria writes, “It appears that many countries are setting into a form of government that mixes a substantial degree of democracy with substantial degree of illiberalism. Just as nations across the world have become comfortable with many variations of capitalism, they could well adopt and sustain varied forms of democracy.”[19] Mr. Zakaria may be right.  All democracies may not strictly be called liberal democracies as those of the West but there can be the worst forms of democracy thatmay not have even a semblance of democratic virtues in society from social and economic perspectives. Competitive authoritative regimes are such examples.[20]We can have a democracy but a dysfunctional one, captured by the elite and vested interests. Such democracies may not be inclusive at all and may not be much different from dictatorial regimes. Safeguarding the interests of few groups or families cannot be a democracy in the true sense.

Exclusion: The root of fragility

People need to feel that they have a stake in the democracy. It can be done through policies of inclusion and incorporation but in case of Pakistan the state has followed exclusionary policies and the result is that people have become disillusioned with the political system. Sit-ins and agitations are the very manifestations of such disillusionment. Political, economic and social exclusions are deeply entrenched in Pakistan. A small segment of society has monopoly over power, profit and patronage. Huge gaps exist between theory (constitutional rights as enshrined in the Constitution) and their implementation in real life.  Plutocracy,as it existed in colonial times when the British relied on very few families to perpetuate their colonial rules, is still a reality of political life where very few families perpetuate their hegemony over political and economic power.

The state apparatus- bureaucracy, judiciary, police, etc. —has not adapted to the needs of a modern democratic dispensation that is supposed to be working on the principle of equality. At least four forms of exclusion can be identified very easily i.e. regional exclusion, exclusion from access to land, exclusions based on religion, and exclusion of youth and women.  While Pakistan is a federation, exclusion of some regions from political power and economic development is a big source of conflict and fragility. Baluchistan, Khyber Pakhtunkhwa (KPK)and Sindh have persistently complained against Punjab’s domination indecision making at the central level. Then there are further divides among the provinces themselves.

In Punjab, the divide between its Northern and Southern parts due to uneven development is apparent. In Sindh, it is evident in the shape of rural-urban disparities. In KPK, there is a clear divide in development indicators and priorities for the settled districts such as Mardan, Charsada, and Nowshera andthe tribal area starting from Peshawar to the Afghan border at Torkham. The grievances of the Baluchis and Pashtuns are not only limited to exclusion from national power and resources buttheir traditional governance structures there are also highly exclusionary in nature. The tribal areas stretch from Chitral in the northeast to Baluchistan’s Mountain’s southwest end and the Pakistan-Afghanistan 2430 km Durand line frontier. It seems as if the Pakistani State is totally out of touch with the tribal dimension and has hardly made any serious effort to incorporate these areas in the national mainstream.

The governance structures have not changed from what they were prior to independence. For example, in the FATA, the federal government’s representative (the political agent) uses tribal leaders (maliks) to maintain control over the local population and channel development resources. Maliks were widely resented by the people and this resentment helpedthe Taliban attract support through a narrative of struggle against the corrupt Political agent-malik nexus.  The case of Baluchistan is similar where hereditary leaders called ‘sardars’ wield power and act as intermediaries between the state and the populace. They are the main beneficiariesof natural resources, hold political offices and control the allocation of development budgets in their interest. So the point here is that no serious efforts were ever taken by the state to make the political system inclusive by incorporating these geographical areas through adoption of modern governance structures. The seventh 2009 National Finance Commission award and 18th Amendment are some steps forward but the results of the same yet remain to be seen as these steps have not yet fundamentally done away withexclusions, even at a theoretical level.

Another source of exclusion is the highly skewed distribution of land in Pakistan.  Traditionally, the big landlords have remained the custodians of economic and political power. If poverty is endemic and no light is visible at the end of the tunnel, then democracy will remain in peril. We have seen that democracy and income are directly linked. Empirics suggest that land reforms have a significant and positive impact on income growth and accumulation of human and physical capital. Land reforms introduced in India are a case in point.[21] Unequal distribution of land in rural areas is a major cause for the skewed political and economic power in Pakistan. Highly skewed power structures explain the fragility of institutions in Pakistan as institutions evolve and become strong in comparatively egalitarian societal arrangements.

According to estimates about 67 % of households own no land. About 18.25% of households own 5 acres of land and 9.66 % own 5 to 12.5 acres of land. A very small portion of households, 0.37%, own large farms above 55 acres of land. High level of unequal land distribution is thus the main reason and manifestation of poverty in rural areas.[22] With the passage of time things have worsened and poverty has deepened. The impact of the industrial revolution and mechanization of farming is now very much visible in rural areas. Added to this, the policies forrural development were tailored on the assumption that agricultural development is synonymous with rural development. Such is not the case.  Small percentage of households own land in the rural areas.  The landless majority did not benefit from the agricultural policies.  The fallacious approach to rural development has further strengthened the grip of the land owners on the political and economic landscape while the landless have become poorer and poorer with the passage of time. No concrete policy has ever been tailored for the rural non-farm economy[23] andsurplus labour with the result that even the so-called democracies have failed to disperse power among the rural landless class.

Due to the concentration of power in a few hands, institutions have not become inclusive with the result that a majority of the people now do not consider themselves stakeholders in the affairs of the state. The nexus between land ownership and political power is a big stumbling block in the political empowerment of the landless. They can neither exercise their political power nor hold the leaders accountable. They are just mobilized to provide support to their patrons at the time of elections. Theycannot form horizontal networks and are helpless in face of the corrupt and elite-controlled system of governance. Persistence of power of the landed elite, especially in the province of Punjab,is a result of the reinforcement overtime of an institutional framework of politics where the landed elite has provided services in exchange of patronage. The dependence trajectory path which started with the advent of the rule of the British in the subcontinent could not be altered even after hundreds of years. Several critical moments came in the history of Pakistan but all the ‘critical junctures’ were wasted due to the deeply entrenched power of the landed elite.[24]

The third category of exclusion relates to minorities. They have been formally as well as informally discriminated against by the state and the society. Social, economic and political space has shrunk for them with each passing day. Our society has slowly but steadily grown intolerant towards the minorities.  The last couple of years have registered sharp deteriorating trends in this regard. An alarming trend of persecution of those advocating minorities’ causes and raising their voice for a more inclusive, harmonious and tolerant polity has become more pronounced. Now it seems as if our society has internalized this culture of intolerance towards the minorities. Against this backdrop, it is important to go back to Pakistan’s founding fathers to see as to what kind of polity they wanted and what place they reserved for non-Muslim communities in the body politic of the newly created state.

Pakistan is lucky enough to have what is called a ‘youth bulge,’ when developed countries like Japan are worried about the future economic growth due to their aging population. There are, however, apprehensions that the youth bulge may not necessarily turn out into a ‘youth dividend’ mainly due to their non-integration into the economy. The economic growth rate is not sufficient to provide the youth decent employment. Pakistan is faced with twin challenges with regard to the youth. First, how to increase economic growth to at least above 7% and then sustain it to absorb the burgeoning population of the youth in the labour market and second how to provide the skillset to the youth required by the labour market. Pakistan’s economic growth rate is hovering around 4% which is not sufficient at all to provide employment to the youth entering the labour market. The determinants of long-term economic growth are nowwidely known and discussed in economic literature. It is now well recognized that institutions and human resources are the main determinants of long-term economic growth and by tinkering at the margins, you cannot sustain economic growth. Liberal investments are required for human resource development.

Unfortunately, Pakistan has invested very little in education and health, even when compared to countries with similar economic development and per capita income. Unemployment among the youth is the most serious area of concern for Pakistan.  This has a direct link with political stability. If urgent policy steps for creating decent employment are not taken, things may get worse in the coming years simply due to heightened awareness and expectations of the youth. When people become more educated, their relations with the state change. They become more demanding. According to the UNDP report, 2014 Pakistan is ranked 146in the Human Development Index, at the same position it was last year, among a total of 187 countries. Pakistan has been bracketed with low development countries like Nepal, Afghanistan, Myanmar, Mali, Kenya, Rwanda, Nigeria, Uganda, Sudan, Ethiopia, and Liberia. Pakistan is the worst scorer, even in South Asia, as India, Bangladesh, Sri Lanka, Bhutan, Maldives, and Nepal respectively sit at 135,142, 73, 136, 103, and145. Further, Pakistan has the lowest female HDI in the South Asian region. In terms of GDI Pakistan is ranked 145 while India, Sri lanka, Maldives, Nepal, Bangladesh, and Bhutan are respectively placed at 132, 66, 90, 102, 107, and 136. Pakistan is ranked 127 out of 187 countries in terms of gender inequality. Pakistan is bracketed with Afghanistan, Niger, and Yemen where gender gaps are 30-40% higher and business as usual approach may take decades to narrow down these gaps[25].

Pakistan’s educational system has been a main contributor towards exclusion and fragility of democracy.  It is highly exclusionary with three streams running parallel to one another. The first stream relates to Urdu medium schools which mostly operate in the public sector. Students in Urdu medium public schools come from low-income groups of society. Madressahs are the second stream of education in Pakistan. These religious seminaries cater to the needs of the poorest of the poor. The third category of schools is of the privately run schools. They cater to the needs of the upper and upper middle class. Schools established by the Army also fall under this category.  The point here is that different streams of education adopted in Pakistan have accentuated schisms in the society with different outlooks towards democracy and worldviews which are at loggerheads with one another. The educational system has contributed towards alienation and polarization in society. Education in Pakistan is stratified according to the socio-economic status of people. It also provides different earning opportunities with different income levels. Education is considered a great social and economic leveler. Contrary to this,the education system in Pakistan has helped create haves and have-nots through sustained focus on elite education to the detriment of the common man[26].

Here arises an interesting question: why did the state patronize elite education and neglect the poor and the downtrodden? In Pakistan, education has historically received little priority both in terms of resource allocation and policy focus. The reasons are quite obvious.The political system, democratic or otherwise, was never broad-based in character as well as orientation. As the decision-making power was dominated by the rich elite, the poor never figured in political priorities. If the political arrangements are not broad-based, politicians are not responsive to the needs of the families using public schools[27]. It implies that neglect of public education for the poor will continue unless political arrangements are broad-based and reflect the preferences of the people.

It may be added here that sustainability of democracy is also closely linked to education. The idea that higher education leads to more democracy has received a great deal of empirical support. What are the channels through which education promotes and sustains democracy? First is the standard efficiency argument. It says that democracy provides an effective mechanism to oust corrupt, incompetent and inept politicians through elections. This would, however, be possible only if the voters are capable to process information to evaluate and monitor government actions and policies. The uneducated and illiterate voters are certainly in a disadvantageous position compared with the well-educated voters as far as their ability to process information and take rational decisions is concerned. Winston Churchill is reported to have once said that the best argument against democracy is a five-minute conversation with the average voter. The sustainability of democracy thus depends on the quality of the average voter as well. Democratic elections do not help and may possibly harm in the recruitment of a competent and honest political elite in countries with largely uneducated populations[28].

Good governance and inclusion.

Empirics on democracy suggest that it does not per se contribute towards economic growth. It does not reduce corruption at least in the short-run and its impact on inequality is also doubtful. The salubrious impacts of democracy on development and growth come via good governance. Governance is still an amorphous concept. However, it essentially means rule of the law, institutions and not persons,accountability, control of corruption, and transparency. Governance and state capacity are also closely related. Capacity of tax collection i.e. tax-to-GDP ratio is taken as a proxy variable in empirical literature for the capacity of the state. Against this yardstick, we have a weak state. Our tax-to-GDP ratio is the lowest in South Asia. We cannot collect due taxes.  We rely more on indirect taxes and cannot bring the tax evaders to book.Public health and education systems do not deliver.  Dispensation of justice to the poor and powerless has become a nightmare because the state cannot enforce its laws and provide prompt and cost-free justice. It is not possible to improve governance unless state capacity is improved. How can the universal right to education be honored if the teachers do not show up to teach? How can the basic health delivery be ensured if the doctors are absent from the hospitals and basic health units? How can the proper taxes and duties be collected if those responsible to run the state machinery do not feel obligated to pay taxes?

Poor governance is as big a source of instability as exclusionary policies are. “That governance in Pakistan is far from perfect is evident in many ways. Relations between the state and the people in Pakistan are weak. Service delivery to people is poor, if they exist at all, institutions are weak and law and order precarious. Various parts of the state cannot seem to work with one another. Poor governance increases frustration and reduces state legitimacy in the eyes of the people. It creates space for alternative ideologies. Many instances can be cited in Pakistan where weak governance result in frustration. There is some evidence to show that lack of governance is also a factor in the spread of extremism”[29].

Pakistan has persistently scored low on various indices of governance.  Forexample, in the World Bank’s World Governance Indicators [30] (WGI) index which measures the performance of a country against six indicators i.e. voice and accountability, political stability and absence of violence/terrorism, government effectiveness, regulatory quality, rule of law, and control of corruption, Pakistan’s score is persistentlyin thenegative as is evident from the following tabulated data.

Table 1: Pakistan’s governance score on WGI

Indicator Year No. of sources Governance score(-2.5 to+2.5) Percentile rank


Voice and accountability 2002












Political stability and absence of violence 2002












Government effectiveness 2002












Regulatory quality 2002












Rule of law 2002












Control of corruption 2002












Source: Interactive data access—

The Failed states index of the World Peace[31] is another important index for judging the democratic capacity of a state and its governance performance. This index is composed of twelve indicators directly or indirectly having relevance with the state capacity and governance. It ranks the states against the following: (1) demographic pressures—concerns related to food security, population growth and mortality rates (2) refugees and IDPs—population displacement and refugees (3) group grievance—tensions and violence among groups within state (4) Human flight and brain drain (5) uneven economic development—in terms of ethnicity and region etc.(6)poverty and economic decline—poverty rates and economic performance (7) state legitimacy—corruption and other measures of democratic capacity such as government performance and electoral process (8) public services (9) human rights and rule of law (10)security apparatus –internal conflict and the proliferation of nonstate armed groups (11)fractionalized elites—conflict and competition among local and national leaders (12)  external intervention—levels of foreign assistance as well as imposed interventions such as sanctions, etc. According to the ‘Failed states index’, Pakistan is persistently at the tail of the countries ranked,implying that both democratic capacity and governance leave much to be desired.

Table-2:Pakistan’s score on failed states index

Year Rank Total Demographic pressure Refugees &IDPs Group grievances Human flight & brain drain Uneven economic development Poverty and economic decline State legitimacy Public services Human rights and rule of law Security apparatus Fractionalized elites External intervention
2010 10 102.5 8.1 8.9 9.4 7.9 8.4 6.2 8.9 7.3 8.9 9.7 9.5 9.3
2011 12 102.3 8.8 9.2 9.3 7.5 8.5 6.6 8.6 7.3 8.7 9.4 9.1 9.3
2012 13 101.6 8.5 9.0 9.6 7.2 8.2 7.2 8.3 7.0 8.6 9.3 9.1 9.4
2013 13 102.9 8.9 9.1 9.7 6.9 7.9 7.5 8.4 7.3 8.7 9.8 9.2 9.6
2014 10 103.0 8.8 8.8 10 6.9 7.6 7.5 8.5 7.6 8.6 9.9 9.5 9.3

Source: Annual reports of the last five years published by the United States Think-tank ‘Fund for Peace’ and the magazine Foreign Policy

Pakistan’s ranking in other international reports like Transparency International, Doing Business of the World Bank, the Global Competitiveness Report of the World Economic Forum, and the Human Development Report of the UNDP is also not enviable. A declining trend in its ranking is visible. One point is clear and that is that governance in Pakistan is poor and democratic capacity is weak.

Poor governance and low state capacity are a result of eroding legitimacy of the state due to exclusionary policies and the capture of state institutions by the elite.  A state cannot acquire legitimacy without providing public goods like education, public health, law and order and justice. Disillusionment of the common man with the state and its institutions is the real problem. A corrupt, arbitrary and weak state is more of a problem for the weak and the downtrodden.  So far, the state has served the interests of the rent-seekers, corrupt mafias, landlords and the so called elite who have bent the laws in their favour due to the concentration of political and economic power in their hands. The provision of public services isselective and class based. Institutions are hardly serving the poor, powerless, disadvantaged and the marginalized sections of the society who constitute a majority in the country. The rich can buy their way out – gated communities and private guards (security of life and property), private schools and private hospitals. The poor cannot. They have to suffer harassment and humiliation by the very state functionaries who are tasked with their security and well-being[32].

There are multiple reasons for the weak capacity of the state. On the top of the list is the lack of political legitimacy of the governments. The governments in power have been seeking legitimacy from small but influential groups of people through doling out favors. People at large have been ignored through exclusionary policies of the state. But with the changing socio-economic dynamics and rising populism, the state and its institutions can perhaps no longer afford to ignore the silent majority of Pakistan. Good governance and inclusionary policies are the need of the day. The legitimacy of the state should come from its public service delivery but in order to improve service delivery and give voice to the people, governance reforms of a fundamental nature are needed. Business as usual will not deliver.

In the context of Pakistan, good governance is also important to make democracy work here. If the democratic regimes do not deliver, people will start looking towards the military and in a country where military has ruled for a long time, civilian supremacy cannot be ensured unless popular support exists among the masses for the democratic regimes. It will be possible only though good governance. But the point here is that good governance comes from strong institutions. “In countries where institutions are strong, actors are more likely to participate in the political process through institutionalized arenas, while where they are weak, protests and other unconventional means of participation become more appealing.”[33]And it is also a fact that strong institutions emerge from relatively egalitarian societal structures for which we will have to say good-bye to elitism and exclusionary policies.

Reforms should aim at four prime objectives. First, they should do away with exclusions as much as possible. Second, they should give voice to the man on the street and disperse power among the people at large. Third, they should improve public service delivery. Fourth, they should promote social cohesion in society and reduce instability. To meet these objectives, a set of reforms is urgently required and the sooner we initiate such reforms, the better.What should be the key areas for improving governance and strengthening democratic capacity? The first area of reforms that comes to mind is the civil service as civil servants are primarily responsible to translate the policies of the government into action. The civil service is the Achilles heel of the state capacity where little effort has gone into seriously addressing it.

The reforms introduced in the civil service were generally misdirected and meant only to abolish its impartiality and make it dependent on patronage. “Civil service reforms introduced in Pakistan had a different set of objectives altogether. The basic compact of the structure changed. Of note is the fact that the most significant effect of civil service reforms was to make it dependent on patronage. How this came about requires detailed review. Suffice it to say, that, imperceptibly, the incentive structure changed. Propriety brought with it punishment, or at the very least unimportant positions, while ‘delivery’ brought favors and promotion. Politicos base the measure of civil servant performance on personal judgment. In many cases, one sees that they reward bad behavior and penalize good conduct”[34].

A lot has been written on the need and nature of reforms in civil service. The gist of such recommendations is that the civil service reforms should aim at increasing the links between the civil servants and the general public. They need to be made more responsive and accountable to the public. Then there is a need for increasing professionalism among the civil servants. A generalist civil servant groomed in classics may be no longer relevant to specialized needs[35].    “Moreover, reforms are needed as regards their recruitment, compensation, promotion and accountability. Insulating the civilian bureaucracy from the vices like corruption and grip of politicians should also become important ingredients of such a reform process. Competence, integrity and public service delivery should become the basis of their performance, promotion and placement. Political connections, sycophancy or service group should not become points of discrimination among the civil servants”.[36]

The second area which needs urgent reforms to improve governance is the taxation system. “Pakistan’s inability to raise revenues to meet the essential needs of the state is a major reason for its poor state of governance. Government would rather lose grip on a state going adrift in terms of law and order and economic well-being, than to annoy the elite that refuses to meet its essential responsibility of paying taxes. The short-term trumps the long term and everyone suffers. On the surface, the status quo benefits the elite and they do not wish to change it. In the end though, their own ability to govern weakens. Inability to raise taxes results in high fiscal deficits as it is essential to meet state expenditure. The resultant high inflation acts as a tax on everyone again with high incidence on the poor”[37].

Pakistan’s tax system is riddled with serious pitfalls. First, the tax burden is not borne by the rich and elite mainly due to politico-economic reasons. Equity considerations require that the tax system is designed in a way that there should be ‘equal treatment of equals’ and those who have the ability to pay more should pay more taxes than those who do not. The taxation system is highly inequitable due to its tilt towards indirect taxes and massive tax expenditures. Only 7% of tax revenues are collected through direct taxes.Indirect taxes constitute the major component of the tax revenue. Indirect taxes are generally regressive in nature and easy to collect.  A major chunk of direct taxes is collected through withholding tax and deductions at source and for all purposes and effects, withholding taxes are indirect taxes.

The tax-to-GDPratio is the lowest even in South Asia. Tax burden has increased on the poor segments of the society in the last couple of years. This is amply clear from the change in contribution of various commodities to tax revenue. For example, share of revenue from POL products has substantially risen in the last five years and the bulk of revenue accrues from HSD oil that is mostly used in public transportation. According to World Bank estimates tax expenditure aggregates to more than four hundred billion rupees per annum. But if both national and provincial tax expenditures are taken into account, the total may exceed seven hundred billion rupees[38].

The tax system is also linked with democracy and state building. Modern-day principles of representative democracy owe their genesis to taxation. States and Kings required money to fight war. In return, people demanded more power and authority from the kings. Taxes thus forged a social contract between the state and citizenry and paved the way for democracy. ‘No taxation without representation’ was the slogan of the American Revolution and explains the grievances of British colonists, who had no representation in the British parliament, but were required to pay taxes. Even in the UK, major concessions extracted from the Crown were due to new taxes imposed by the King of England. Whenever the Crown introduced new taxes, the elite of that time came up with a new charter of demands aimed at clipping the powers of the Crown. This tug of war between the Crown and the elite nurtured the seeds of western democracy.[39] When a majority of the people pay taxes, they exercise a check on the government.  A wide tax base thus promotes democracy and inclusive policies.

The third area that should become a focus of reforms is the local bodies. An elected local bodies system is a tried and tested form of local governance worldwide. After all, local public services like healthcare, education, transfer of land title, sanitation, and police protectionare the need of every individual which can be cost-effectively rendered at the local level. The irony is that whenever a military regime is in power, local governments are installed whereas democratic regimes are always averse to the very idea of local governments. The reason is that the democratic regimes are not democratic in the true sense of the word. They can at best be called competitive authoritarian regimes[40].  Local government reforms were introduced in 2001 but the system was discontinued as soon as a democratic government came to power. Local governments are the real essence of democracy. It is only through local bodies and village councils that we can make the people masters of their destiny. It will not only empower the man on the street but will also make the public functionaries more accountable and responsive. Education is another area where reforms are needed to make society inclusive. Reforms in education should essentially aim at three objectives i.e. doing away with the three-tier system, linking education with market realities, and honing cognitive skills.

According to Amartya Sen, democracy is a social instrument of bettering the society and removing injustices and social inequities[41]. To make democracy inclusive, we need to change public discourse. Democracy should not be a luxury for the elite and the middle class. If it is the will of the majority, it should have something to offer to the poor and disadvantaged who constitute a majority in the country. Inequality, poverty, corruption, and rent-seeking are our own choices. These are products of our political and economic policies and unless they are changed through pro-poor discourse and policies, the faith of the common man in democracy cannot be strengthened[42]. “Democracy is going through a difficult time. Even in established democracies, flaws in the system have become worryingly visible and disillusion with politics is rife. Yet just a few years ago, democracy looked as though it would dominate the world.—one reason why so many democratic experiments have failed recently is that they put too much emphasis on elections and too little on the other essential features of democracy”[43].

Notes and References

[1] The author is a graduate of Columbia University.  Email:

[1] Herald exclusive, September 15,2014, “ Pakistan’s experience with democracy”

[2] S.Akbar zaidi “ State,Military and social transition –Improbable future of democracy in Pakistan”, Economic and Political Weekly , December 3,2005

[3] Mahmood Monshipouri & Amjad Samuel  “Development and democracy in Pakistan;tenuous or plausible nexus?”, Asian Survey ,Vol 35,No.11 ( November,1995)

[4]Daron Acemoglu & James A.Robinson, “Why did West extend franchise? Democracy, inequality and growth in historical perspective”, The Quarterly Journal of Economics,November,2000

[5]Collective action problem simply means who will bell the cat.  Lack of coordination and networking are really at the heart of collective action problem.

[6] Jared Diamond, “ Four Threats to American democracy”,  Governance: An International Journal of Policy, Administration, and Institutions (2014)

[7]Dr. B.R. Ambedkar is considered the principal architect of the Indian Constitution and was first law Minister of independent India.

[8]The Economist , “ What has gone wrong with democracy”, March,2014

[9]Professor Dani Rodrik, “ Rethinking democracy”, Project syndicate, June 11,2014

[10] Joseph E. Stiglitz, “ Some lessons from the East Asian Miracle”, The World Bank research Observer (August,1996) ; also refer to ‘The Making of an Asian Tiger by Jamil Nasir, The News International, July 27,2013

[11]J.Benhahib &A.Przeworski, “The political economy of redistribution under democracy”, Economic Theory,Vol.29,No.2 (October,2006)

[12] Samuel Huntington ,“The Third Wave : Democratization in the Late Twentieth century” University  of Oklahoma press (1991)

[13]Daron Acemoglu, Simon Johnson, James Robinson & Pierre Yared , “ Income and Democracy”, American Economic Review (2008)

[14]Joseph Stiglitz’s “The price of inequality” has postulated that inequality is growth reducing as it dampens aggregate demand. Several papers have been issued on this line of argument. Inequality is now being studied and discussed as an economic phenomenon and not merely as a moral issue.

[15]Oxfam’s “ Working for the few”, briefing paper ,April 3,

[16]DaronAcemoglu, Suresh Naidu, Pascal Rest repo & James A. Robinson, “Democracy, redistribution and inequality”, MIT Department of Economics Working Paper series  (Oct, 2013)

[17] Robert Barro, “ Democracy and growth”,NBER working paper series, Oct,1994

[18] Yan Sun & Michael Johnston, “Does democracy check corruption? Insights from China and India”, Comparative Poliitcs,Vol.42 ( October,2009)

[19] Fareed Zakaria, “The rise of illiberal democracy”, Foreign Affairs, Nov/Dec 1997 issue

[20]Steven Levitsky and Lucan A.Way, “ The rise of  competitive authoritarianism”, Journal of Democracy, Vol. 13, April,2002

[21]Klaus Deininger, Songqing Jin & Hari K.Nagarjan, “ Land reforms, poverty reduction, and economic growth: evidence from India”,  The World Bank, December ,2007

[22] Talat Anwar,Sarfraz K.Qureshi,Hammad Ali & Munir Ahmad, “ Landlessness and rural poverty in Pakistan”, The Pakistan Development Review , PIDE, Islamabad (Winter,2004)

[23] Please refer to following articles for details ,all by Jamil Nasir , “ Focus on rural non-farm economy” ( Dawn Op-Ed, January 7,2008), “ Need for inclusive rural development” (Dawn Op-Ed, February 4,2008),  “ Is it worth neglecting?” ( The New, Op-Ed, May 9,2013)  and  “ The Path is through the village”, ( The News ,Op-Ed, August 26,2013)

[24] Hassan Javid, “Class, power, and patronage: The landed Elite and Politics in Pakistani Punjab”, a thesis submitted to the Department of sociology of the London School of Economics for PhD degree, London, June 2012

[25] Sustaining Human Progress: Reducing vulnerabilities and building resilience, UNDP’s report ,2014

[26]Refer to Dr. Tariq Rehman’s study titled “Denizens of alien worlds: A study of Education, Inequality and polarization in Pakistan”

[27]David de la Croix & Mathias Deopke , “To segregate or to integrate: Education, Politics and Democracy”, IZA Discussion paper ( August,2007)

[28]Piergiuseppe Fortunato& Ugo Panizza, ‘Democracy, education and the quality of government” (Nov,2012)

[29] Strategy not Tactics: Better Governance for social stability in Pakistan, Institute for Policy Reforms (IPR), Lahore, September,2014

[30]WGI  are produced by  Daniel Kaufmann of Brookings Institution, Aart Krayy of  World Bank Development Research Group, and Massimo Mastruzzi of WBI

[31] Nomenclature changed in 2014 from “ Failed states Index” to “ Fragile states index”

[32] Refer to “ To make the state strong”, Jamil Nasir ( The News, Op-Ed, May 27,2014)

[33] Inter-American Development Bank (IDB), “Political institutions and street protests in Latin America” ,IDB Working paper series, Nov 2009

[34]IPR’s report ibid

[35] IPR’s report ibid

[36] Refer to  “ Invigorating the civil service”, Jamil Nasir ( The News, Op-Ed, June 22,2013)

[37] IPR’s report ibid

[38] Dr. Hafiz A. Pasha , “ Report on real, relevant and owned tax strategy for FBR”, Federal Board of Revenue, 2014

[39] Refer to “ Taxation for democracy”, Jamil Nasir ( Daily Times, Op-Ed, January 29,2011)

[40] Competitive authoritarian regimes are neither democracies nor authoritarian regimes; For example, in such regimes elections may be fought bitterly but electoral process may not be fair.

[41]Jean Dreze & Amartya Sen, “An uncertain glory: India and its contradictions”( page 244), Published by Penguin Books, London, 2013

[42] Refer to “ The puzzle of democracy”, Jamil Nasir ( The News, Op-Ed, February 27,2014)

[43]The Economist ibid