FIVE YEAR

PLANS OF
PAKISTAN
By: Moiz Nveed. Tabarak Ali and
Zeeshan Liaqat
First five-year plan
(1955-1960)

 Emphasis mainly on achieving high

national income.
 The First Plan was implemented within
certain obvious handicaps and limitations
and its release was delayed by two Years. 
 In practice, this plan was not
implemented, however, mainly because
political instability led to a neglect of
economic policy, but government, Deputy
Chairman Planning Board (Commission)
Said Hassan announces the plan in 1957. 
Achievements/
Shortfalls:

 The GNP recoded a growth of 13% instead

of 15% as targeted in the Plan. 
 Industry together with fuels and minerals
received another 31% of the total
resources which exceeds the target of 28%
provided in the Plan.
2) Second five year
plan (1960-1965):

 The 2nd five-year plan was approved

by the Economic Council of the
Pakistan on June 21, 1960.
 The 2nd plan aims at increasing
national income by 20 %. In view of the
anticipated increase in population of
about 9%, this will mean an increase of
about 10% in per capita income. The
plan assumes the rate of growth of
population as 1.6% at the end of the
1st plan and 1.8% at the end of the
2nd plan.
 Three dominant strains run through
the plan
 Achievements/
Shortfalls:

 During 1965-66 there is increase in the production

of tea, salt, cotton cloth and yarn, board, caustic
soda, cement and cycle rubber tires and tubes. The
increase in the quantum index of manufacturing
industries from 100 in 1959-60 to 201.7 in 1964-65.
 The strategy paid off very well as the actual growth
rate surpassed the projected growth rate. The GNP
registered a growth of 30% over the plan period
compared to 24% proposed in the plan and per
capita income grew 15% instead of 12% projected
in the plan. The large-scale industrial production
exhibited nearly 161% increases in production
compared to only 60% increase proposed in the
Plan.
Third five year plan
(1965-1970):

The Third Plan was approved by National

Economic Council in May 1965 and it was
revised in 1966 due to following two reasons:
 Pakistan had to fight battle with India. 

 The seasonal conditions became worst for

agriculture sector which affected production
 An amount of Rs.52000 million was allocated
for the plan out of which Rs.30,000 million for
the public sector and Rs.20,000 million for
the private sector were allocated. 66 percent
of the total plan size was to invest from the
local sources and remaining 32 percent
through the external sources. 
Achievements/
Shortfalls:

 Performance in the industrial sector was

also far from satisfactory particularly in the
large-scale industrial sector. The large-
scale industrial sector exhibited a growth
rate of 10% as against 13% targeted in the
Plan. The industrial sector as a whole
expanded at an annual growth rate of
7.8% instead of 10% targeted in the Plan

 The small-scale industry just performed

well
Fourth five-year plan
(1970-1975):

 When the government of Zulfiqar Ali Bhutto

came to power in 1971, planning was
virtually bypassed. The Fourth Five-Year Plan
(1970-75) was abandoned as East Pakistan
became independent Bangladesh. Under
Bhutto, only annual plans were prepared,
and they were largely ignored.
 The revised total size of the second Plan was
fixed at Rs. 75 billion, an increase in 44%
over the Third Plan size. The increase 6.5%
annual growth rate as compared to 5.5%
targeted in the Plan. 
Achievements/
Shortfalls:

 Industrial sector had all along been leading sector in terms

of sustain growth. Value added fell by 6.8% during 1971-72
compared to depress based of 1970-71 when the growth
was only 1.2%.Steady growth in 1973-74. Different factor,
like war with India and tight credit polices and East Pakistan
crisis growth decline 6.8% in 1971-72.
 Steady improvement or recovery in 1972-73.
Manufacturing sector slow-down during 1974-75 because
low level of investment and shortage of raw material.
Textile has heavy weight in total industrial production.
1974-75 there was also difficult when value added project
to grow by 10% in the LSM sector recorded negative growth
of 1.7%. in 1976-77 During this time manufacturing sector
continue to remain under pressure due to various national
and international factors
Fifth five year plan
(1978-1983):

 The economic growth in Pakistan became stagnate

due to the application of Annual Planning in
Pakistan by Peoples Party Government during the
period of 1970-78 therefore, the Marshall Law
Government drafted the Fifth Five Year Plan in
1977 and it was implemented in very difficult and
unfavorable condition because:
Commodity Production sector had turned into
completely a stagnant sector.
 Imports increased fast.
 Foreign exchange reserves were decreasing very
fast. 
Achievements/
Shortfalls:

 As a whole, the growth rate projected for

the industrial sector was almost fulfilled
(growth rate was 9.7% as compared to
10% targeted in the Plan).
 In July 1978, the interest rate on loans for
fixed investment in industry and
agriculture was reduced from 12.5% to
11%.
 The Zia government accorded more
importance to planning. Fifth plan was an
attempt to stabilize the economy and
improve the standard of living of the
poorest segment of the population.
Lessons from these
strategic plans:
There is a need to look at the economic
strategies society where foremost objective is
to provide opportunities for learning, increase
potential of communities by linking them in
networks and ensure fair competition in trade
and investment.
Some major challenges
in achieving economic
development:

 Energy crisis
 Terrorism
 Wealth Concentration
 Corruption
 Youth Unemployment
 Lack in quality Education
 Poor health facilities
 Tax evasion
 Lack of good Governance
 Merits and demerits of five year plan:

Merits Demerits
Expansion of transport Consumer industries remain
underdeveloped

Expansion of communication Housing conditions are appalling

Increase exploitation of mineral Overcrowded slums

wealth

Expansion of heavy industry Poor working conditions

Growth in military power Quality of production low

Growth in industrial power Extensive use of slave labor

Why we lagged behind
from Korea, Singapore
and Malaysia:
We lagged behind from these countries because of:

 No institution is working properly and is not self

sufficient.
 For over a decade, Pakistan has been in a state of
war against terrorism, which affected many foreign
investments and tourism.
 Very few people in Pakistan give taxes, so there is
no process of reliable tax collection stream, due to
incompetent governing institutions.
 Our economy is import based, we import more and
export less due to which we have a large current
account deficit.
 Due to money laundering, every year billion of
dollars laundered outside Pakistan.
Some strategies to
adopt in current
economic situation:
 We need to improve our economic
strategies. There are areas that need
attention to boost the economy, keeping in
view the potential of tourism, security for
visitors to be improved and current visa
policy should be reviewed. Adopting a
“Make in Pakistan” approach to strengthen
domestic industry would create the much
needed jobs as well as value-added
exports and import substitution. We have
to develop Pakistani Companies and
people have to use Pakistan Government
brands.
Thank You