Impact of the_war_on_terror_on_the

Group Members

Name• Muhamad Abdullah• Naeem Ishq• Salman Niaz• Waseem Shah• Abd ul Qadir

Roll No.• 29• 43• 27• 60• 11

Contents

Topic• Introduction• Governance Failure• State of the Economy• Economic costs of the war

on the Terrorism

Presenters• Abd ul Qadir• Salman Niaz• Waseem Shah• Naeem Ishq

IMPACT OF THE WAR ON TERROR ON THE PAKISTAN’S ECONOMY

Introduction

• Impact of this war is multidimensional e.g. it has political, social, national security and most importantly economical impact..

• these dimensions are closely interlinked with each other..

• Failure at one front raises the probability of failure on all fronts..

How different factors are interlinked

Governance indicators

• Lack of good governance is believed to be among the root causes of growing crises in Pakistan..

• Governance problems have always existed, mainly it is due to lack of accountability..

• To understand the governance condition in Pakistan, The World Governance Indicators (WGI) is a best instrument..

Governance Indicators

• (WGI)A project of world bank that include 213 countries and ranks them according to their governance condition.

• Following factors are considered at the time of raking..1. Voice and accountability2. Political stability3. Government effectiveness4. Regulatory quality5. Rule of law6. Control of corruption

Governance indicators in Pakistan

Voice and accountability

1. In this indicator Pakistan’s %ile rank is 20.9

2. Regional average percentile is 32.8

3. Governance score (-2.5 to +2.5) of Pakistan is -1.00

4. Standard error = 0.12


Political stability






Government Effectiveness1. In this indicator Pakistan’s

%ile rank is 19.02. Regional average

percentile is 33.53. Governance score (-2.5 to

+2.5) of Pakistan is -0.934. Standard error = 0.18


Regulatory Quality






Rule of Law






Control of Corruption





Governance indicators in Pakistan (2000-2009)

Control of Corruption

Rule of Law

Regulatory Quality

Govt. Effectiveness

Political Stability

Voice & Accountability

0 5 10 15 20 25 30 3524.3

19.3

33.3

19

0.5

20.9

13.3

24.3

22

29.6

15.9

10.6

Column1 2000 2009

State Of The Economy

Pakistan’s economy has faced with many challenges such as:1. Slowdown of economic growth2. Decline in investment..3. High inflation..4. High level of fiscal and current account

deficits..5. Dislocation of economic activity


Gross Domestic Product Growth(%) Investment as % of GDP


Exports as % of GDP Fiscal Deficit as % of GDP

State Of The EconomyGrowth in CPI(consumer price index) (%) Unemployment Rate(%)

Economic cost of War on Terrorism

The costs of the participation in the war on terror are rising exponentially in terms of:1. Dislocation of economic activities2. Damages to property…3. Investment climate…4. Slowdown of overall economy…5. Losses of human life…6. Higher expenditures on defence ad police


• In 2007-08 according to IPP(Institute of public policy) the economic costs of the war on terror were 380billion..

• SPDC(social policy and development center) updated these estimates for the year 2009-10 and identified 290billion additional expenditures...

• SPDC also identified that Govt. increasing the expenditures related to security with an average of 14.6% from 2000-01 to 2007-08 annually.

• This percentage have increase to 20.5% per annum after 2007-08…

Official Estimate Of Loss To Economy


Direct Costs of War o Terror

Direct costs include :• compensation to

victims, damage to property

• infrastructure, • higher expenditure on

defence, and Police • Costs of private

security.• The value of lives lost

is part of direct costs, but difficult to quantify.

Direct costs on war on terror (RS in Billion) estimated by IPP.Details 2007-

082009-10 Incre

ase (%)

Cost compensation to victims 3 6 100

Cost of damage to property ad infrastructure

8 13 63

Higher cost of defence 109 247 127

Higher cost of police 21 43 105

Higher cost of private security 8 11 38

Total direct cost 149 320 115

Economic cost of War on TerrorismIndirect costs of war on terror• Indirect costs mainly

include:• costs to local

economies (loss of economic growth in Khyber Pakhtuhkwa and FATA)

• Costs of loss of investors confidence such as fall in private investment

• Fall in stock market• capitalization.• Decline in tourism and

rise insurance costs.

Indirect costs on war o terror(RS in Billion)Details 2007-

082009-10

Inc.(%

Costs to local economies 40 130 210

Loss of economic growth in KPK 42 130 225

Cost of IDPs 2 n.a n.a

Costs of higher risk perceptions 189 391 107

Fall in private investment 52 244 369

Fall in stock market capitalization 120 123 2

Others 17 44 41

Total indirect cost 231 521 126

Except

Human Loss• About 40000 deaths in

drone attacks, suicide attacks, trucks bombings, targeted attacks, Helicopter attacks etc.

• About 5000 soldiers• Approximately 35000

civilians• Hundreds of severely

wounded…

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