Pakistan’s economic issues will not be resolved by simply collecting income tax more efficiently; rather it needs to address poverty and deprivation by a root and branch change in the system

With only a month before the general election in Pakistan, the UK government is planning to double the amount of aid it provides the country from £267 million to £446 million. This will make Pakistan the largest recipient of UK aid.

In approving the substantial increase in aid a committee of MPs, headed by committee chairman Sir Malcolm Bruce, exclaimed they wanted the new government in Pakistan to improve tax collection and develop an effective anti-corruption strategy. Empty words, indeed, from the British establishment that has provided patronage to successive corrupt Pakistani governments over many decades.

The real problem of Pakistan is not the mere absence of tax collection policies. Rather the 190 million Muslims of Pakistan are exasperated with the actions of the political elite in neglecting the needs of the people and depriving them of a system which reflects the basis upon which the country was established – the system of Islam.

With systemic government failure the foreign aid will do little but prop up another failing recipient regime.  From the perspective of the donor country, British tax-payers, suffering hugely under the strains of recession, can scarcely afford to lose a penny with the country entering its fifth year of austerity. That is why the British government’s commitment to maintaining the international development budget, in spite of deep cuts in expenditure elsewhere, is so telling. Foreign aid is not charity and is provided with strings attached in order to achieve foreign policy objectives. In light of this, the British government’s military occupation of Afghanistan and its continuing War on Terror in the region is inseparable to financial aid to Pakistan.

Pakistan’s economic issues will not be resolved by simply collecting income tax more efficiently; rather it needs to address poverty and deprivation by a root and branch change in the system.

Starting with politics an Islamic constitution and a genuine representation of the people via the Majlis-e-Ummah (Council of representatives) as well as various institutions that regulate the Khaleef’s (head of the government) mandatory powers within the boundaries of the Shari’ah will ensure real accountable government; and not the sham of the political circus we see in the country today.

In economics the replacement of weak fiat currency with the strong bi-metallic (gold and silver) money base will provide financial stability and certainty that will encourage investment and economic growth. The Bayt-ul Mal (Treasury of the state) will secure tax revenues by Kharaj (land tax) on Pakistan’s abundant agricultural potential and redistribute wealth to alleviate poverty and deprivation.

Pakistan is not indigent to require aid with little or no resource of its own. The country has huge agricultural capability, a young population, one of the world’s largest coal reserves (Thar, Pakistan) and has the potential to found a new industrial revolution.  The aid thus does more harm than good in deepening dependency while maintaining the corrupt political status quo.

With the general election at the forefront of political debate in the country, the Muslims of Pakistan should not just call for a new government but an alternative ruling/economic system based on Islam that will be transformative aiming for true independence and self-sufficiency and permanently brining to an end dependence on foreign aid and patronage.

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