Islamabad, Feb 12 (IANS) The most damaging impacts of corruption in Pakistan, often presented as a moral or criminal aberration, are structural and economic with comparative research on public investment indicating that corruption does not only divert money but increases costs, impacts procurement decisions and weakens project viability, a report stated.
“Such vulnerabilities are intensified in mega-projects, where vast capital flows, complex contractual agreements and decision-making power lodged within narrow institutional networks that are poorly situated to sustain oversight are involved. In such contexts, corruption is not an episodic failure of enforcement but a predictable outcome of institutional and contractual design,” lawyer Mustafa Arif wrote in Pakistan’s leading daily ‘The News International’.
“The persistence of corruption in mega-projects is not primarily a deficit of law: it is a structural mismatch between formal accountability mechanisms and the political realities governing large-scale infrastructure,” he added.
Procurement rules, audit procedure and accountability agencies to regulate public spending in Pakistan function within a political economy characterised by elite bargaining and selective implementation. In such an atmosphere, implementation is rarely neutral and accountability is often dependent on political alignment instead of legal breach, he stated in The News International.
The impact of corruption and weak accountability can be most seen in how huge projects are considered and priced by investors and creditors. These concerns have become increasingly noticeable in some huge projects in Pakistan.
Although these initiatives have delivered critical energy and transport infrastructure, however, reports have emerged that inflated costs, delay in projects and contractual revisions have impacted confidence in the stability of the underlying legal framework, with multilateral lenders stressing that such uncertainty causes liabilities for the state, sparking questions regarding fiscal sustainability instead of merits of any single project.
“For Pakistan, a country navigating repeated balance-of-payments crisis and IMF-supported stabilisation, legal uncertainty raises borrowing costs and constrains future investment. The higher costs ultimately fall on the public, constraining fiscal space and diverting resources from social development, where informality displaces predictable, rules-based governance, infrastructure ceases to function as a shared economic asset and becomes a source of sustained vulnerability. Also, the harm is not unilateral; foreign partners also face sunk costs, project uncertainty and enforcement risk, reducing incentives for sustained engagement,” wrote Arif.
–IANS
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