It is said that those who don’t learn from history are doomed to repeat it. But what about those who distort history and are bound to make it even worse? Pakistan is one such place where the people at large not only refuse to learn from history but also tend to distort it to suit their own narratives leading to a country where, much like Alice in The Wonderland, up is down and down is up.
The Bhutto era is one such instance in our history. Its economic history has been distorted to a great extent mainly by our establishment to cover up its own wrongdoings and put the blame on civil leadership altogether. Sadly this distortion is still actively regurgitated in modern media at a time when the most powerful information tool in the history of mankind, Google, is in the palms of everyone’s hand. Most people criticize Bhutto for nationalization of industries and farmland distribution schemes as having caused huge loss to Pakistan’s economy without looking at subsequent data. The objective of this article is not to support nationalization or a particular personality or party but to highlight how it is imperative for our population to break free from media manipulation and think for themselves with the power of research in the age of internet.
Despite claims of collapse, the sales of all nationalized industries increased from 1,428 million rupee in 1972-3 to 2,349 million in 1973-4 – an increase of over 64%. At a constant price level of 1969/70, the economy saw the relative share of total public sector investment sharply rise from 12.6% in 1972/3 to 60.2% in 1974/5. The exports in 1972/3 increased by 153% over the previous year, and manufactured exports grew by 19% in 1973/4. This growth in exports, which increased from 8,551 to 10,161 million rupee from 1972/3 to 1973/4, was a key factor in the growth in industrial output between 1972 and 1974. The total assets of the establishments taken over in 1972 were around 1,910 million rupees with total liabilities of 1,420 million rupees, leaving their net worth at about 490 million rupees. In 1975-6 the nationalized units paid a total of Rupee 1330 million by way of corporate tax, sales tax, excise duty and other taxes as compared to 1210 million in 1974-5, 660 million in 1973-4, and 390 million in 1972-3, whereas prior to nationalization the amount paid was less than 200 million.
The overall GDP growth during Bhutto’s five year rule was a remarkable 4.8% after Pakistan broke up & despite the fact the oil prices rose by 4.5 times in 1973-74 (the biggest ever % rise) & stayed high. In addition Pakistan was also hit by major floods in 1973 & 1976. GDP grew by 7.4%+ per annum in his first 2 years (1972-73) which is better than any government in Pakistan’s post-1971 history. The oil crisis of 1973 and two worst floods had a major impact in the later years. Making matters worse, during Bhutto’s time oil prices rose by 5 times between 1972 & 1976, from $2.48/barrel to $12.80. Still excluding the 1971-72 war year, the average growth was 6.1%. Pakistan’s GDP per capita in US$ terms also took a hit in 1972-73 after the war, devaluation and the oil crisis but then recovered and surpassed its level of 1969, going from 150 dollar per capita to 207 dollar by 1977.
Bhutto’s policy of land reforms and focus on agriculture was also largely successful despite repeated claims to the contrary in modern political discourse. The production of wheat for years 1970 to 1972 had fallen well short of consumption with shortfall managed with the help of 0.6 million ton being provided by U.S government as aid and on credit. In five and a half years of Bhutto’s rule, the production of wheat went up from 6,782 thousand tons in 1971-72 to 9,144 thousand tons in 1976-77. The yield per acre had also increased from 12.9 maunds to 15.4 maunds. This was primarily because of large scale investment in fertilizer sector in the country as well as increased distribution of land to farmers which incentivized higher yields due to land ownership. Fertilizer production nearly doubled from 1974 to 1976 and half a million acres of farm land was redistributed as per The New York times (NYT). The Government also introduced a pension plan for the elderly and abolished a land tax that although small, was an irritation to farmers and a vehicle for corruption among the collectors. The NYT article also stated that “With real economic growth perhaps as high as 5 percent annually, which is good for this part of the world, international economists are generally pleased with the postwar recovery that Prime Minister Bhutto has brought about.”
Whether nationalization was wrong in principle or if it had problematic long term effects is a different debate, but how ineptly the blame for failure of all state owned enterprises has been pinned upon the civilian leadership of the 1970s, while in fact it was the result of rot of later years, shows how deep this factually incorrect narrative has been fed to our society. All prime ministers who followed Bhutto have suffered similar propaganda despite being responsible for the vast majority of the development that has taken place in the country. It is through this propaganda that political parties and their supporters are encouraged to fight one another whilst those actually responsible continue with their disastrous policies that through three martial laws have prevented Pakistan from being at par with its more successful neighbors. If this country is to progress, the people must support the civilian democratic leadership that comes into power against any non-political force since each political party once in power has done better than the alternative. Political parties themselves must show unity to prevent non-democratic forces from interfering and causing great damage to the country, otherwise we will continue to remain in this loop of regressiveness for a long time to come.
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