Only through the policy of redefining Pakistan's economy can progress be made.

 This article aims to not only comprehend the fundamental economic issues, but also some difficult but attainable reforms that have the potential to provide immediate corrections as well as medium- to long-term solutions that have the potential to actually redefine and fix the economy. Since 1947, well-organized interest groups have run Pakistan's economy, but the real problem is still the political power structure, which has led to almost a socioeconomic collapse.

Although we are all aware of the following issues, it is essential to comprehend their underlying causes and the measures that can be taken to address them through reforms. The main areas of concern are:

One of the lowest Gross National Saving Rates (GNSR) and a super consumption pattern Undocumented economy and financial inclusion Loss-making State Owned Enterprises (SOEs) Structural and capacity issues in the agriculture, industrial, and services sectors Foreign Direct Investment (FDI) and Investor Confidence Energy infrastructure Climate change Youth bulge No regional economic integration and no resources for education, health, and general welfare billion, while imports grew from USD 41 billion to USD 72 billion, resulting in an increase Even though our exports are low, they are not competitive and do not add any value, unlike traditional exports like textiles, which are heavily subsidized and contribute nearly 50 percent. Our exports are still around USD 30 billion, compared to USD 48 billion for Bangladesh and USD 670 billion for India. With losses from PIA, Railway, Steel Mill, DISCOs, and GENCOs accounting for approximately PKR 600 billion annually, SOEs, particularly those that consistently incur losses, contribute a drag of 8% of GDP. Even SOEs that make money, like those in the oil and gas industry, have lower profits and operational efficiencies than their private sector counterparts.

The distribution of wealth and income is another major source of inequality: The top 10% of Pakistanis own 60% of the country's wealth and 43% of its income, while the middle 40% own 35% of the country's wealth and 40% of its income (World Inequality Database). Similarly, the distribution of land shows that, according to Land Portal, more than half of the population does not own a single foot of land, while only 5% of the population owns 64% of farmland. Our level of economic documentation and financial inclusion remains one of the lowest in the developing world. There is still less than 35% of the world's money in circulation, indicating a larger economy that is not regulated or taxed. With 88% of deposits coming from Karachi, Islamabad, and sixteen other major Punjab cities, the banking sector is still unrepresentative. The fact that only 12% of Pakistan's population contributes indicates a low level of trust in the banking system. This could be due to interest-based banking or tax evasion.

The path forward By correcting our system's anomalies, certain short-term and immediate solutions can be achieved. The 18th Amendment must be revised in particular by the National Finance Commission. To begin, the criteria for allocating resources must be altered and rationalized to place a greater emphasis on developmental parameters rather than the population.

Within a period of six months, provinces must complete PFCs (Provincial Finance Commissions) and the devolution process through local government elections and legislation, focusing on increasing the share of local taxes, sales taxes, agriculture taxes, and other taxes. The federal government should adjust debt repayments and defense expenses from the provincial share if the provinces do not adhere. This understanding is crucial because the provinces receive 56% of federal resources, which average PKR 4 trillion and are nearly equivalent to the fiscal deficit. Corruption and ineffective federal and provincial governments have actually become a curse.

Similarly, reduce the number of ministries held by the federal and provincial governments to no more than fifteen, which could include: Cabinet, Finance and EAD, Foreign Affairs, Revenue and FBR, Climate Change (with NDMA), Science and Technology, Maritime, Health and Education and FS Policy, Energy (Power and Petroleum), Interior, SAFRON, and Industrial Development and EPZs are all included in this category. In a similar vein, 30% to 40% of federal and provincial departments will be shut down within six months due to their ineffectiveness. The cost of running the government could be cut in half with these two measures.

By three to five years, aggressively renegotiate at least 30% of our international bilateral and multilateral debt with firm commitments to demonstrate reforms. This could reduce the burden of foreign currency cash repayments by approximately USD 16 billion and ease repayments. Prime real estate assets worth trillions of rupees but not producing are the loss-making SOEs. These should be sold right away with transparent sale proceeds, and their defaults should be changed as part of management changes that replace the incompetent senior management and boards with market-based talent. If not, privatization should begin immediately.

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This could include infrastructure for climate change, education, health care, highways, railways, ports, and shipping, among other things. Islamic bonds could also be used to structure a large portion of the PSDP (Public Sector Development Program). This would allow the economy to generate cash flows without having to borrow money at higher rates from domestic and foreign lending institutions. It would also encourage investment locally and bring FDI into the country. The GNSR will also significantly rise as a result.

Water management, PCR Abiyana, seed, fertilizer, middleman replacements, storage/silos facilities, easy access to bank loans, and integration/connectivity with neighborly and regional markets are among the agriculture sector reforms that include revamping farm to market inefficiencies and anomalies. Establishing an agro-based export and value-added industry for all major crops, dairy, fruits, and livestock should be the primary focus. Despite our position as seventh largest agricultural producer, our yields rank among the lowest; We need to improve the efficiency of our agricultural research institutions, and our agriculture departments need to be completely redesigned or privatized.

The capacity and performance of the industrial sector fall far short of the country's economic needs. This sector must be restructured in the direction of export orientation and value addition. Information technology, mining, defense exports, fishing, solar, and the semi-conductor/chip industries should be the primary areas of focus. A regulated energy model based on emerging market models is urgently required. Reduce your reliance on thermal by focusing on alternative energy sources like solar, nuclear, and run-of-the-river hydropower. This could be accomplished while strengthening the transmission lines to control theft and reduce line losses. Our average losses in transmission and distribution are 21%, while the global average is 7%, and our revenue losses are 10%, while the global average is 1%.

Capacity for regulation needs to be improved, domestic gas use needs to be limited and moved to industry, and Discos and Gencos will eventually be privatized. Redesigning the FBR, Planning Commission, BoI (Board of Investment), etc. is necessary. to concentrate on business convenience. A ten-year plan for industrialization, the tourism industry, FDI initiatives, social protection, education, and health must be implemented immediately. Last but not least, actual devolution by reducing the role of federal and provincial governments to a minimum and increasing the effectiveness of local governments. To get rid of the "political electable mafias," proportional representation could also be proposed as an alternative.