Muhammad Asad Tahir Bhawana

Pakistan has the potential to achieve significant economic growth and development by prioritising investments in its human capital. However, the reality is that Pakistan's human capital is currently low and has only experienced marginal improvements over the past three decades, according to the World Bank. These disparities in human capital outcomes have persisted or even widened over time, affecting various groups such as the rich and poor, men and women, and rural and urban areas, as well as disparities among provinces. In terms of absolute and relative measures, Pakistan's Human Capital Index (HCI) value stands at 0.41, which is considerably low. It is lower than the South Asia average of 0.48, with countries like Bangladesh at 0.46 and Nepal at 0.49. Pakistan's human capital outcomes are comparable to those in Sub-Saharan Africa, where the average HCI value is 0.40.

Talking to WealthPK, research economist Dr Mehmood Khalid said to enhance its human capital Pakistan should adopt a life cycle approach that focuses on building, protecting and utilising human capital from before birth through early childhood development, schooling, and ultimately productive employment. "This approach requires a long-term commitment, recognising the multidimensional and cumulative nature of human capital investments. It also necessitates coordinated efforts from multiple stakeholders and sectors, emphasising inter-sectoral linkages, and maintaining continuity of policies across political parties and governments.""Many countries at a similar level of development as Pakistan have successfully implemented such strategies, despite regional variations and significant gaps.

Pakistan possesses the necessary tools to implement such strategies, assuming stewardship of human capital investments and fostering long-term economic growth. The country's handling of the Covid-19 pandemic has demonstrated its ability to manage complex challenges, despite institutional constraints," explained Mehmood Khalid. Moreover, he said strong human capital was crucial for sustainable economic growth, preparing the workforce for future highly skilled jobs, and effectively competing in the global economy. "Investing in human capital also builds resilience and adaptive capacity to mitigate the impacts of climate change. It develops the skills and ingenuity required for a green and inclusive economy and helps reduce inequality." The research economist said the HCI of 0.41 indicates that a newborn in Pakistan today will only achieve 41% of their potential productivity if they were to receive complete education and enjoy good health.

"Another significant aspect of Pakistan's human capital crisis is the underutilisation of human capital, largely due to low female labour force participation. Najy Benhassine, the World Bank's Country Director for Pakistan, has emphasised the severity of Pakistan's human capital challenges. "With over 20 million school-age children out of school, high levels of child malnutrition, and limited empowerment of women, Pakistan's human capital crisis is among the most serious in the world." "It represents a profound and silent crisis that has far-reaching negative effects on the country's potential and its people. The Human Capital Review underscores the importance of controlling population growth, significantly increasing investments in healthcare and education, and promoting female labour force participation to unlock substantial economic growth for Pakistan," he pointed out.

Credit : Independent News Pakistan-WealthPk