Beyond GDP: Why Pak continues to lag in human development

PAKISTAN’S ranking at 168 out of 193 countries in the latest Human Development Index (HDI) report should serve as a wake-up call for policymakers. While public debate often revolves around GDP growth, foreign exchange reserves, fiscal deficits and IMF programmes, the HDI reminds us that the ultimate purpose of economic policy is not merely to increase national income but to improve the quality of human life. Pakistan’s frustrating position reflects a deeper reality: economic growth has been too slow, too inconsistent and too disconnected from human development. The Human Development Index, developed by the United Nations Development Programme, measures progress through life expectancy, education and per capita income, offering a broader picture of development than GDP alone. Pakistan’s HDI value has gradually improved over the past two decades, yet its global ranking has fallen from around 147th in the early 2000s to 168th today, reflecting not a decline in absolute terms but the faster progress achieved by many other countries. One major reason for Pakistan’s low HDI ranking is its inconsistent economic growth. Although GDP growth exceeded six percent between 2003 and 2007 and reached eight percent in one year, it proved unsustainable. Since then, repeated cycles of boom and bust, driven by energy shortages, political instability, security challenges, debt pressures, floods and policy discontinuity, have limited growth. As a result, per capita income remains among the lowest in the region and rapid population growth has diluted gains in national income, making it difficult to improve individual welfare and living standards. The comparison with neighbouring countries is instructive. Bangladesh, once considered economically weaker than Pakistan, now enjoys a significantly better HDI ranking. Nepal, despite its geographical and economic constraints, has also made substantial progress. These countries invested consistently in education, healthcare, women’s empowerment