THE GOAL OF ECONOMIC DEVELOPMENT
by Prof. Khurshid Ahmad
The goal of our whole
struggle and more particularly that of the rulers in Pakistan, has been "economic
development". The first expressed priority of the present government is that the
country should progress more and more economically, and do so fast so that we stand
soonest at par with the developed, well-off and civilised nations. Apparently, there seems
nothing wrong with such thinking, yet it is better that we take a pause and established a
well considered view.
Two questions have become
central in importance and need necessarily be answered by the Muslim Scholars.
(I) If the development
experience of the Muslim countries in particular and of the Third World countries in
general spread, as it is, over the last 40 to 50 years has failed to inaugurate a new era
of sustained growth and widespread wellbeing, can there be an alternate road?
(ii) Capitalistic as well
as socialistic roads have landed mankind into a cul-de-sac. Is there a way out?
Muslims claim they have an
alternative. Islam is not merely a religion that deals with private relationship between
man and God, it provides guidance for the entire gamut of life, including man’s
economic life and destiny.
The ‘god’ that
has been jubilantly worshipped in the post-Second World War era, both in economically rich
and politically triumphant countries of the West as well as in the poverty-stricken and
newly independent countries of the ex-colonial empires in Asia and Africa, has been the
‘god’ of development. As the German scholar, Wolfgang Sachs, succinctly puts:
"The last 40 years can be called the age of development… Like a towering
lighthouse, guiding sailors towards the coast, ‘development’ stood as the idea
that oriented emerging nations in their journey through post-war history. No matter
whether democracies or dictatorships, the countries of the South proclaimed development as
their primary aspiration, after they had been freed from colonial subordination. Four
decades later, governments and citizens alike still have their eyes fixed on this light
flashing just as far away as ever: every effort and every sacrifice is justified in
reaching the goal, but the light keeps on receding into the dark… Since then the
relations between North and South have been cast in this mould: ‘development’
provided the fundamental frames of reference for that mixture of generosity, bribery and
oppression that has characterised the policies towards the South. For almost half a
century, good neighbourliness on the planet was conceived in the light of
‘development’."
The scenario is now
changing. "Today," adds Wolfgang Sachs, "the lighthouse shows cracks and is
starting to crumble. The idea of development stands like a ruin in the intellectual
landscape." In fact, "this epoch is coming to an end. The time is ripe to write
its obituary." And obituaries have started appearing.
The First Global
Revolution, a report by the Council of the Club of Rome, is one recent obituary from an
international think-tank. The report of the United Nations Development Programme, Human
Development Report 1992 is another obituary, written in a somewhat different vein. The
Club of Rome intellectuals start with the lament: "Humankind seems to be gripped by a
fin-de-sieche attitude of uncertainty at the threshold of the new century, but the era of
a millennium brings still deeper mystique with its sense of widespread change and the
uncertainty accompanying it."
The results of
developmental efforts, the report regretfully confesses, "have been uneven and often
disappointing" and warns "the grave problems of world poverty, aggravated by
population growth, could well give rise to great and disruptive disharmony on a wide
scale, from which the industrial countries cannot escape the consequences." The
report suggests that "it is strongly in the self-interest of the rich countries that
a new, powerful and radically different approach be taken to the problems of world
development."
The Human Development
Report 1992 brings to focus the glaring reality that the rich have grown richer and the
poor become poorer at the end of the three decades of the so-called universal
developmental effort. In 1960 wealthiest one billion of the world’s five billion
population were 30 times better off than the poorest one billion. According to the latest
estimates, taking into account internal discrepancies within nations, the top one fifth
are probably around 150 times better off. The Guardian editorially comments that the
"developing countries enter the market as unequal partners and leave with unequal
shares."
Although the editorial
falls short of calling this act of penalisation of the Third World by "international
economists and financiers" an attempt "to defraud the developing
countries," it does accept that through "what is at best self-deception these
actions have the same result." The tragic consequence is that "for a sizeable
slice of the world’s population, three decades of much-trumpeted development have
been three decades of de-development." (April 25, 1992)
The condition within the
rich and developed countries is no different. About the US the latest information released
by the Congressional Budget Office shows that the richest one percent of the population
got almost 70 percent of the increase in average family income between 1977 and 1989. The
situation becomes more startling if the income rise of the richest 20 percent is taken
during this period. The richest 20 percent took more than 100 percent of the growth in
average income with the result that the bottom 40 percent of the population actually lost
ground and transferred part of what they were getting 15 years back to the richest 20
percent. See "To Close the Wealth Gap," The New York Times editorial reproduced
in International Herald Tribune, April 23, 1992.
This is the global context,
in which we are reviewing the development "syndrome". At some later stage we
shall suggest the strategy which can help from the Islamic Approach to development.
Man has always been
searching for short cuts to realise his ideals. With political freedom, the Third
World’s self-realisation of its economic and social plight deepened. Its exposure to
the West made it even more conscious of its abject poverty and of the widening gap between
the rich and the poor. During the era of colonial rule, the Third World heard many success
stories of western development. In the post-colonial period it was invited to follow the
growth path pursued by the West. Economic development was offered to the people of the
Third World as an answer to all their problems.
In the pursuit of
development, industrialisation was seen as "the quick way to prosperity" and
capital formation was emphasised as the key to industrialisation. Transfer of western
technology and foreign aid were seen as sufficient to make up for the two major gaps in
savings and balance of payments. Import-substitution and, to a lesser extent,
export-promotion strategies were developed to realise the dream. Economic development
became the new god at whose altar everything else was to be sacrificed — values,
cultural patterns, social norms, customs, religion, ethics and what not. It was assumed
that a rising GNP would usher in a new age of prosperity and affluence. Mankind would
enter a new millennium of affluence by following in the footsteps of the developed
countries of the West.
This summary may rightly be
described as rather too simplistic. But it is equally true that the development strategies
based on western models, as they were introduced in the Third World, contained a host of
simplifications, carefully wrapped in sophisticated jargon, and not without an element of
arrogance about the superiority of the western way of life. The most positive, even
enthusiastic, response came from the Third World’s western-educated elite, who had
been brought up in the cradle of colonialism and had inherited power from the departing
masters. This alliance of convenience between the West and the new power-elite of the
Third World is now under severe strain because the development strategy that was
assiduously pursued has failed to produce the required results. In almost every developing
country, indigenous forces not so favourably disposed towards the western models are
engaged in a search for new paths more in keeping with their own cultural identity. They
are challenging the westernising minority almost everywhere.
Even if it is conceded that
too many hopes were pinned on the drama of development, the record of the last 30 years is
still disappointing. The problems of poverty, underdevelopment and stagnation continue
unameliorated. Two centuries after the advent of the industrial revolution and three
decades after the inauguration of a grandiose development crusade, it is disturbing to
note that a majority of the human race remains poor, suffering from under-nourishment,
under-shelter, disease and illiteracy. The World Bank acknowledged with regret that the
failure to achieve a minimum level of income above the "poverty line" has kept
some 40 percent of the populations of the less developed countries in a condition of
"absolute poverty."
Although some
"enclaves" of development have emerged as a result of developmental efforts,
they have failed to result in any broad-based changes in the society; nor were they able
to mobilise all major sectors of society in the cause of development. Over-emphasis on
capital has generated distortions in price structure, exchange rates, tax system,
wage-scales, forms of technology and so on. Distributional aspects have been largely
ignored with the result that economic and social disparities within societies have
increased. Employment-generating effects have been far far below the required minimum.
Even natural population increase and consequent inflow in the labour force could not be
absorbed in the economy through new employment opportunities. In spite of
import-substitution strategies, dependence on imports continues and, as terms of trade
have generally moved against the developing countries, trade and balance-of-payments gaps
have increased. International indebtedness has also rocketed (over $1.3 trillion) while
the net flow of real resources from the developed countries to the Third World has not
only tapered off, in some cases even a reverse flow has begun. The energy crisis has
further aggravated the resource constraints. The overall picture remains bleak.
A word may also be added
about the international context in which developmental efforts of the Third World
countries have taken place. The relation of dependence that was built into international
economic relations during the colonial period continues unabated. The gap between the rich
and the poor nations is widening. Prices of internationally traded goods show erratic
movements injurious to the interests of the developing countries. Inflation is being
aggravated by the monetary and trade policies of the developed countries. Twenty of the 24
developed countries are pursuing protectionist policies vis-à-vis imports from the Third
World. Consequently Third World countries are caught in severe balance-of-payments
problems. International monetary institutions are unable to handle the situation. The UNDP
study, Human Development Report 1992, accepts that the structure and working of the World
Bank and IMF must undergo fundamental changes if they are to be responsive to the needs of
the poorer countries of the world. Crises are being postponed, not controlled. The fate of
development in the Third World is very much tied to the reform and restructuring of the
international economic order. There has been a lot of heat and smoke in the North-South
dialogues; there is, however, very little light. It seems pretty dark even beyond the
tunnel.
Muslims feel dissatisfied
with the whole developmental effort on all the above counts. They are further disturbed by
the amoral character of the entire growth philosophy, which is steeped in the ethos of
western culture and its secular liberalism. In the context of the Muslim societies this
has acted as a centrifugal force, tearing the Muslim societies into warring nationalities,
regions and classes. A totally materialistic approach is alien to the Islamic way of life
and the historical tradition of the Muslim people. Islam wants to transform human society
and restructure its socio-economic life according to the values of justice and fair play.
It also seeks to weld the moral and material approaches into a unified and integrated
approach to life and its problems. Any approach that splits life into secular and
religious dimensions is anathema to Islam.
The western approach has
been based on a disrespect, albeit not always explicitly articulated, for other cultures
and social systems. As a result, efforts have been made to transplant western values and
cultural patterns on to other peoples, leading to the disintegration of their cultures.
This has been justified as imperatives of the process of modernisation. All this has been
systematised into a theory of change stipulating that values and institutions that favour
and strengthen exclusively materialistic considerations — motives, incentives,
results … are the prime movers of social systems. Competition and reward have been
made to replace long sustained humanistic attitudes and customs. People’s motivation
patterns, valued social institutions, relationships and systems of pecuniary reward and
punishment have had to change to suit the alleged demands of economic development. Even
those who do not subscribe to the Rostowian stages of growth do accept the substance of
his analysis of the nature and direction of social change.
Muslims look upon the
entire developmental exercise as a grotesque effort aimed at cultural imperialism. Their
main objections may be summarised thus:
a) The West-inspired
approach to material prosperity has promoted in Muslim society an imitative mentality
which is inimical to creativity and destroys originality. This not only aggravates the
trends towards moral decay in the society but also perpetuates the hegemony of western
culture on Muslim lands. It promotes an active collusion between the West and the
westernised elite in the Muslim world because development of Third World countries as
cultural satellites of the West is bound to ensure an ever-increasing demand for western
products.
b) A systematic application
of this development strategy has proved to be highly divisive in Muslim society, splitting
it up into modern and traditional, liberal and conservative, urban and rural, rich and
poor and so on. This has perpetuated colonial traditions and encouraged consumption habits
that tear the modern sector from the rest of the society and tie it in with its
counterparts in the western world. This has led to the enrichment of a privileged minority
and the impoverishment of the mass of people. It has engendered economic and social
dualism and new tensions and conflicts within society. Lifestyles are changing in such a
way that a high consumption-oriented privileged society is being imposed upon a mass of
people committed to a different set of values and traditions. This is alienating the
allegedly developing sections of the society from the rest. Symbols of modernisation are
becoming targets of hatred.
c) The entire experiment
has been terribly wasteful and extremely costly. Import substitution has failed to enhance
the real technological capabilities of the economy, yet it is making a large number of
people addicted to new luxuries and lifestyles that the society cannot, and should not,
afford. A high consumption society is being created in countries that have little to
consume. The patterns of consumption and production have become distorted, and tilted to
serve the whims and fancies of a privileged minority. The real gains to society have been
minimal.
d) There has been a
metamorphosis of attitudes in the direction of hedonistic individualism. Concern for
individual standards of living has taken precedence over that of strengthening the
economic base of the nation. Greed and corruption have raised their ugly heads.
e) At the root of this
approach is the assumption that an economic system can move on its own without
simultaneous deliberate changes in political system, social institutions and moral
attitudes of the people. It is assumed that the delicate balance that exists between
different aspects of individual and social life will readjust itself in the light of the
changed economic situation. The experience, on the other hand, is that this has divided
the society and added to friction, rivalry, confusion and waste.
Consequently, the totality
and integrity of the social system have been ignored. This is at variance with the Islamic
approach which stands for a happy balance between different aspects of life and aims at
the development of an integrated personality in the individual and a happy balance in
society.
Such an imitative and
exclusively materialistic strategy of economic development is repugnant to Islam, which is
not a religion in the limited sense of the word, but has its own socio-economic programme
based on its own world view and a set of ethical values and principles. Historical
evidence indicates that the efforts to transplant western values and culture are proving
counter-productive. Modernisation experiments have only touched the fringe of the Ummah
and have failed to take root in its mainstream. This approach has been superficial, as it
has sought for artificial change, which is bound to prove abortive. A number of western
developmental institutions have failed to become an integral part of the society on which
they have been transplanted.
Moreover, the conditions in
which development took place in the West in the 18th and 19th centuries and the
conditions, which prevail in contemporary Muslim societies, are very different. It is
naive to assume that what worked in the West at a particular moment in history will
equally work anywhere. Again, there is reaction against many of the modernisation ideals
of the West within the West, particularly among its younger generations, which are
increasingly attracted to what has been described as "counter-culture". The
scenario is changing and today’s Muslims, particularly young people, do not want to
perpetuate what they deem as instruments and symbols of western dominance. The Muslim mind
has fully realised the tricky chess game and rather than wasting time on useless pursuits,
it craves for the evolution of a new development strategy.
Translation and adaptation of the
editorial of Tarjuman Ul Quran September,1998.
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