Loud Thinking

Pakistan is sliding into an economic and social emergency. Real incomes are falling, food consumption is shrinking, and inequality is widening at levels unseen in decades. When households begin cutting back not only on meat but on wheat and rice, the crisis is no longer abstract, rather it is existential.

Credible assessments tell the same story. Economist Yousuf Nazar estimates that when vulnerability above the subsistence line is included, as much as 60–70 percent of Pakistan’s population may now be poor or at risk. Former finance minister Miftah Ismail has highlighted that real incomes and consumption have been declining for nearly a decade, while official survey data reported by journalist Shahbaz Rana show poverty and inequality at multi-decade highs.

Pakistan has had seven prime ministers and eleven finance ministers since 2014. If leadership change were the answer, recovery would have already begun. The problem is not who governs Pakistan, but it is how Pakistan is governed.

A State Designed to Spend, Not to Deliver

Pakistan’s constitutional and fiscal architecture rewards expansion of government rather than performance. Power and resources sit far from citizens, while accountability evaporates as responsibilities pass between federal, provincial, and district authorities.

Provinces receive large fiscal transfers but face little pressure to deliver education, health, or economic opportunity. Districts, where citizens actually encounter the state; remain underpowered and underfunded. The result is a large, expensive government that delivers remarkably little.

This is not a failure of intent. It is a failure by design of the elite capture.

What Pakistan Can Learn from South Korea, Malaysia and China;
countries that have successfully reduced poverty did not rely on slogans. They restructured incentives. China achieved historic poverty reduction through relentless focus on delivery and local accountability. Moreover, Switzerland demonstrates how decentralised, fiscally autonomous local governments can deliver prosperity without a bloated state.

Pakistan should adapt these lessons by transforming its districts into civil Cantons: political, fiscal, and administrative units with real authority over education, healthcare, local infrastructure, and taxation.

When governance moves closer to citizens, responsibility becomes visible; and so does failure.

Why Provincial Political Governments Must Give Way

Once districts are empowered as Cantons, the current provincial political superstructure becomes redundant. Governors, chief ministers, and oversized provincial cabinets add cost without improving service delivery.

Provinces should be retained only as lean coordinating bodies, responsible for inter-district infrastructure, standards, and dispute resolution: not day-to-day governance. This reform alone would significantly reduce public expenditure while improving accountability.

Decentralisation does not weaken the state. It makes it work.

Fiscal Discipline Without Austerity for the Poor

Economic recovery will require painful choices, but not for those already suffering.

Loss-making state-owned enterprises must be privatised or closed. Untargeted subsidies and elite privileges including free utilities/servants must end. Tax rates should fall, but exemptions; especially for powerful sectors such as agriculture, retail, and real estate; must disappear.

At the same time, social protection must expand. Cash transfers, nutrition programmes, and education vouchers for poor households are not charity; they are investments in stability.

The Real Choice Before Pakistan

Pakistan’s crisis is often described as cyclical. It is not. It is structural. Without a redesign of the state, growth will remain fragile, poverty will deepen, and inequality will harden into permanence.

These reforms will face resistance and harsh criticism because they threaten entrenched interests and patronage networks. But delaying them guarantees a harsher outcome: a poorer, more fragile country unable to provide opportunity for its citizens.

Pakistan does not need another change of government.
It needs a change in how the state works.

That choice cannot be postponed, because hunger, unemployment, and despair are not waiting.

Syed Nayyar Uddin Ahmad
Lahore.
+92 321 9402157