If all the research expenses are collected from the federal budget, they make upto 51.997 billion Pak Rupees. This is 53% higher than the previous year’s in which 30 billion Pak Rupees were spent. With this much outlay, the R&D expenditures make 0.397% of the total GDP against that of the 0.227% in the previous year. This is highest in the 9 years. Still it does not include the defense related innovation, provincial R&D expenses (that make considerable amount), agriculture related private working and other private sector spending for the purpose. It amounts to 258.7 Pak Rupees per capital expense for scientific & technological development against the previous year’s 149 Pak Rupees.
The details of research and development expenditures given in budgets from 2006 to 2017 clearly shows the declining trend in science and technology allocation, but it is first time since 2006 when the government increased the S&T budget. The collective research expenses from the federal budget 2018-19 are 51.997 billion Pak Rupees, which is 0.397 percent of the total federal budget and about 53 percent higher than previous year. Add another 82 billion from the provincial budgets for R&D in 2018-19. These details are given into the development budgets of the provinces which need little workout to reach the conclusion.
Indeed, all the four provinces committed at least 82.28 billion rupees in the year 2017-18 for the purpose. If at least the same level of spending is continued this year, Pakistan will be reaching the total of 134.28 billion rupees. It makes a very appealing figure of 2.1% of the budget while 1.02% of the GDP (up from 1.8% of budget and 0.86% of GDP last year). It is all time high in the history of Pakistan on the research & development.
Keeping in mind the 9,000 journal articles and developed infrastructure of 180 plus universities while ever flourishing private sector, this calculation is not on the higher side. While, the private spending on R&D must be a quarter of it too and the remaining expenditures should also be equivalent to that. In that manner Pakistan may cross 2-2.5% of the GDP on innovation that makes Pakistan an actual innovation base ground among the emerging economies. Looking at these facts, one should not wonder that Pakistan was counted among the emerging economies by the international rating agencies last year in June instead of being a developing nation. Pakistan deserved that status.
Figure 1: Research & Development Expenditures of Pakistan: % of GDP
A 20 years trend shows a swing into the science & technology related financial decision making of the nation since 1997. A 15 years review shows that until 2016, a complete swing of less-than-3% to the high of 0.63% is completed since 2002. It resounds strange for the nation that is at front line against various highest challenges since 1971. But the picture changes altogether differently when the provincial R&D is added.
The last year expenses in 2018 cross the 1% line.
Looking at the international data made available that gives altogether a negative story, one should think many times regarding the harsh facts. With only 0.39% of GDP spending, it is a worst time. We needed the innovation most against all odds due to the highest-ever negative trade gap of $23b. The country could not cross 0.5-billion-dollar milestone of hi-tech exports as they declined since 2013 while the push could hardly cross the 0.3-billion-dollar line. This is among the direct consequences of expenditures in science and technology.
Though including the provincial budgets, we should satisfy ourselves for a 1.02% of GDP spending, or even higher this year in 2018, yet the actual translation of it into the high-tech exports and other real outcomes, is not visible. There is something wrong on the results side of it. Still we need to develop further infrastructure and strengthen the foundations of S&T.
Another direct impact may be found into the publications of journal articles of scientific value. After taking off in 2003, the nation could crossover the milestone of 9,000 publications a year in 2016. In a 13 years-time, it is a modest achievement. Yet, it shows a steady rise. It is just because of a near-independent professional work of the higher education commission.
The first and foremost issue while assessing the science and technology with a scientific mind is that the budget statement does not mention expenditures on Science & Technology in a cumulative manner. The Economic Survey, the book issued on yearly basis does not specify a chapter for the R&D or S&T. This lower level of focus of the financial accounting for the country’s future leads to the carelessness on the part of all; the financial managers, the higher cadres of bureaucratic establishment and political elites that specifically enjoys funds and statuses linked to the S&T. Al the fruits of development spending first grow in the backyards of elites that do not care for nurturing of these trees.
So, S&T is largely out of focus in the capital of the most advanced Islamic nation, if Turkey and Malaysia are ignored. The claims of being the most powerful, leading nation and the regional player are at stake but priorities are not yet translated into action. With over 170 higher education institutions, Pakistan crossed various advanced nations including Australia. In couple of years, the number of HEIs could be doubled yet out-of-focus spending may lead to a junk of working researchers for time pass. This costs the nation heavily in terms of money and time both, while giving margin to competitors to leap forward.
Who can leap forward after China and India? These are Iran, Bangladesh and Central Asian republics besides many Muslim nations. Turkey and Malaysia have already bypassed. There is none but the poor nation that awaits the fate accomplice. Jinnah should have worried for them, but very few are worried in actual.
Technology makes a difference. Even for China, that imports $200b worth of semiconductors while producing only 16% of the domestic demand from its own production. This costs China more than the oil bill. In order to meet that, China is planning to expand the production of semiconductors. China’s efforts to buy semiconductor companies has been denied due to security reasons by Western countries. So, not only technology but level of production does matter in case of the highest demands. Theory of the trade specialization offered by the trade economists suggests that there is no need to go for the import substitution, yet China is going to try it out. Probably the aggregates have to be taken care of in an unusual way or “in-what-ever-the-way” to reduce the burden on the macroeconomic indicators.
Pakistan aspires to spend Rs. 52 billion Rupees from federal while 82 billion from provincial budgets for S&T in 2018-19. Provinces committed at least 82.28 billion rupees in the year 2017-18 for the purpose. If at least the same level of spending is continued in this year, Pakistan will be reaching the 134.28 billion rupees. It is a huge amount as far as a debt-ridden country is considered. Yet, the world average is very high. The US and China are competing for crossing each other on $450 billion this year. While the neighboring countries are also spending hefty amounts on the same.
It is a real wealth, as far as the future is considered. There is nothing but the future where today’s theories and technologies die down. As the companies set a limit of 3-5 years for the life of electronic items, so is the fate of each technology.
The high-tech exports slowing down or stagnant at best, while there was nothing but a least care for appropriate technologies, the share of the wealth received from modern technology is minimum. Similar is the issue with the currency notes wherein the Iran offered to initiate its own crypto yesterday.
There is more than the demand of S&T; innovation, its documentation, registration and patenting as well as its channelization for production. But all these processes need more than the attention and focused effort. But the politicization leads to nowhere except confusion and infighting. Pakistan has 166 researchers per million population. 0.3% is spent of the GDP is spent on R&D. $2.46b in PPP terms is spent. Out of which government spends 1.6 while the universities spend only $0.8b.
The laws for patents and intellectual property rights are intact. Pakistan received 24 billion rupees in the head of copyright fees which was 28 billion in the previous year.
A research and development funds are established that spent Rs. 34 billion in previous financial year while for the next year Rs. 36 billion are budgeted. There is another head “central research fund” for that reserves to the tune of Rs. 140 billion were budgeted but actual expenditures were only 2 billion while for the next year 3 billion rupees are earmarked. There is no specific reason specified for curtailing these expenses.
If expenditures are nosed down, their impact is doubled because the number of new graduates and researchers keeps on increasing. The institutions are also rising while, if, the expenditures on S&T does not increase with the same proportion, it causes loss of productivity. The productivity of Pakistani worker is already low compared with the developed countries and some of the critical countries with whom Pakistan has to compete. So, a loss of productivity due to the non-budgeting is the sole responsibility of the economic managers. It is again paramount because technological progress is among the critical and vital factors of the economic growth and this fact is an academic reality taught in the courses of higher studies in macroeconomics. If macroeconomics is the basis of selection for a junior economic manager, let alone the high-ups in the economic cadre of the ministry of finance, commerce and allied, then the value of the S&T expenditures must be multiplied looking at the domestic requirement and the regional realities, if not the global ones. While China is competing the US in S&T, India must be trying to approach it, which the Hindu zealots are pursuing the chase.
If we are to compete as nation, in the global, regional or Islamic sphere, we have to compete with certain other nations too. In the global realm, we are facing the US directly in Afghanistan where US is hammering Pakistan in the cloak of the international peace keeping forces, the ISAF. If we do not compete with the US, we have to face the highest of dangers at immediate border. All the war machine may have conducted more exercises with the latest precision technologies. India being the US allied is manifolds ahead in all the fields because it is copying the US and the Europe in best of its manners. S&T is the premier one. It is noteworthy that India has adopted the global role rising from the regional player as it is now just behind the China and is taken as a competitor in many ways.
In the Islamic realm, on the other hand, there is a successful story of Malaysia, but being the non-warring nation, we may find some advantage. Turkey is an example of internal and external challenges similar to Pakistan where they have up-beaten the nearby nations. Turkey is far ahead in many ways. Still Pakistan is lingering little behind Turkey in total number of researchers since 1997.
Pakistan has yet to cross the 100 billion rupees mark for the innovation.
R&D Expenses-Pak ($Billion PPP)
R&D Expenses-Pak ($Billion PPP) for Pakistan are interesting. We are losing the pace in real terms.
Comparison of the present times and the 80s is interesting. In 80s, Pakistan was spending above 0.8% of the gross national product (GNP). While the same reduced nowadays to mere 0.33 and even lesser. So the priorities of the nation are clearly demarcated here.
Leading Islamic Countries: Total No. Of Researchers
Total number of researcher increased in Pakistan as well as other two Islamic countries; Malaysia and Turkey. The lead of Turkey consistently increased over the five years’ time. Now, Pakistan is having little lesser edge.
The comparison of expenditures on research & development as percentage of gross domestic product (GDP) is interesting with the regional as well as Islamic countries. Both China and Malaysia are increasing their %age of expenses while Pakistan and India are reducing over time.
Pakistan’s expenses per researcher declined overtime while that of China and Malaysia have increased. There was little difference between the two Islamic countries initially but overtime Pakistan declined down enlarging the gap.