End elite capture

For decades, Pakistan’s economy has been held hostage – not by external enemies, but by an internal force more dangerous: elite capture.

From the 22 families that controlled Pakistan’s wealth in Ayub Khan’s era to the modern-day industrialists, feudals, and banking moguls, a small group has manipulated economic policy for its own benefit. Unlike India, where a thriving middle class has fueled economic growth, Pakistan has been dominated by a self-serving elite, treating the country like a personal fiefdom.

But now, for the first time in decades, a shift is happening. The establishment has taken a decisive role in economic matters – not as a power grab, but as a necessity. National security is no longer just about borders and defence but about economic stability. A weak economy is a weak Pakistan, and a strong economy is national security.

Pakistan’s adversaries – both internal and external – fear economic stability more than they fear a nuclear arsenal. A strong economy means a strong state, and that is exactly what foreign proxies, economic colonisers and economic terrorists inside and outside Pakistan cannot tolerate. They want Pakistan to remain in crisis, dependent on foreign loans, burdened by debt, and shackled by elite control.

And what is their favourite excuse? The so-called ‘involvement’ of the unelected in economic affairs. The reality? This intervention is because the country’s economy has been hijacked for decades by these same elites.

Look at the Independent Power Producers (IPP) renegotiation deal. For years, the power sector was a cash cow for Pakistan’s economic elite, bleeding the country dry with exorbitant capacity payments. It took intervention to correct the course – saving billions and reducing Pakistan’s dependence on unsustainable contracts. Who opposed this move? The same elites who benefited from these exploitative deals.

For the first time, Pakistan is challenging the old economic order, which served only a handful of industrialists, feudals and corporate moguls.

One of the most blatant examples of elite capture today is the banking sector’s stranglehold over monetary policy. Who sits on Pakistan’s Monetary Policy Committee (MPC)? Banks’ proxies. Who benefits from the sky-high real interest rates? The banking sector. Who suffers? The people of Pakistan and the government.

Pakistan’s real interest rate is among the highest in the world – almost 10 per cent, even when maximum inflation is projected to not exceed 7.9 per cent in the next 12 months. In any rational economic system, real interest rates shouldn’t be this high. But in Pakistan, the banking elites have created a system that ensures massive profits for themselves while choking economic growth.

The result? Industries are shutting down; investors are fleeing; and businesses can’t afford credit. Pakistan’s economy is slowing down while banks make record profits.

Pakistan needs 6.0 per cent GDP growth to match its population growth. At these interest rates, that’s impossible. Yet, the elites in the banking sector – who control media narratives and economic policy – keep justifying these destructive policies.

Who benefits from Pakistan’s slow economic growth? The banking elite who make easy profits from high interest rates; the industrial elite who want monopolies, not competition; and the political elite who survive on a struggling economy to maintain their relevance.

Who suffers? The common people; the middle class; and Pakistan’s future.

Pakistan cannot progress until elite control over the economy is dismantled. The era of inherited economic privilege is over. Pakistan’s future lies in the hands of its middle class, small and medium-sized enterprises (SMEs), and self-made entrepreneurs.

This is where India took the right path – building a middle-class-driven economy where Indian professionals now lead global companies like Google, Microsoft, and IBM. Meanwhile, in Pakistan, economic power is still passed down like kingship, from father to son, from feudal lord to feudal heir.

For years, Pakistan’s economic elite have used philanthropy as a tool to maintain their power. They build institutions not to educate Pakistan, but to create a pool of cost-effective managers for their businesses.

These ‘good elites’ use their philanthropy to create a façade of generosity, while the real objective is maintaining influence. Meanwhile, the ‘bad elites’ continue to loot, plunder, and exploit the country at every opportunity. But their time is up.

The old economic model – built on elite monopolies, high-interest rate profiteering, and exploitative business practices – must end. If an unelected intervention has stepped in to break the chains of elite capture, then it is a welcome change. If our national security forces are ensuring that Pakistan stands on its own economic feet, then this is exactly what is needed.

Pakistan must build its economy on meritocracy, SMEs, and a thriving middle class. The days of dynastic economic power are over. The next generation of Pakistanis must not inherit a broken system controlled by a few families. They must inherit an economy where talent, hard work, and innovation define success.

Pakistan has two choices: one, remain stuck in elite capture, where a handful of families control everything, and the rest of the nation suffers. Two, break free, empower the middle class and create a new economic system where success is based on merit and not inherited privilege.

Economic terrorists – inside and outside Pakistan – who fear Pakistan’s rise will continue their propaganda against this shift. But the truth is simple: Pakistan’s survival depends on dismantling the elite order and building a system that works for everyone. The era of elites is over. Pakistan’s future belongs to the self-made, the hardworking and the patriotic. And no force – internal or external – can stop that transformation.

The writer is a consultant at various large companies, and teaches financial markets in Pakistan. He can be reached at: hissan3@gmail.com