This book explains Pakistan's next 30 years. The signs are already here.

Pakistan feels like one of the only countries where people seem to love every other country more than Pakistan itself. Every third person you meet is either preparing for IELTS, applying for a student visa, or finding some kind of jugaar to get out of Pakistan. And if you are trying to build something here, people will tell you that you are wasting your time and it is better to leave.

And honestly, this has become a common belief in Pakistan. People make major life decisions based on the idea that nothing meaningful can be built here, mainly because our country keeps moving between good times and bad times, with no certainty about how long either one will last.

We have tried many times to fix this cycle. to make the bad times smaller and the good times last longer but throughout our history, it has never really happened. Different governments come with different policies, but the cycle remains the same. We survive the emergency every time, but we never fix what keeps creating it.

So I went down a rabbit hole and started researching, because there had to be a better answer than just a feeling or a belief that nobody could properly explain.

What Ray Dalio Learned From 500 Years of Empires

Ray Dalio is one of the biggest economists in the world and runs one of the largest hedge funds. He studied the last 500 years of different empires, including the Dutch Empire, the British Empire and now the American Empire, which according to him is also moving towards its decline. From all this history and data, he tried to understand what makes an empire rise and what eventually causes its fall.

The interesting thing about his framework is that it works through cause and effect. It does not only tell us what a strong country looks like, but it explains how one thing leads to another over time. For example, if you understand what a country was doing with its education twenty years ago, you can understand a lot about why its economy looks the way it does today.

So I decided to apply the same framework to Pakistan through five vitals: education, innovation, rule of law, the economy and social trust. I will judge each one as strong, weak or critical. And these five vitals are not separate from each other. Each one directly affects what comes after it.

Education is Where the Whole Cycle Starts

And if all these vitals are connected, then we have to start from the place where a country produces its people, which is education. Education is like a seed that you plant today but harvest twenty or thirty years later in the form of economic progress. We have seen this happen in countries like South Korea and Singapore. They invested in education and economic reforms together, and within one or two generations, the result started becoming visible.

Pakistan spends around 0.8% of its GDP on education, which clearly tells you where education sits on our priority list. Our literacy rate is around 56%. Male literacy is around 73%, while female literacy is far below it because we still have parts of our society where educating women is not considered that important. And then around 28% of school-going-age children do not enter the school system at all. So before we even start discussing whether our education system is good or bad, more than one-fourth of our children are not even becoming part of it.

I compare Pakistan with India here only because both countries became independent at almost the same time. India has its own problems, but it invested much more in education and technical talent, and the fruit of those investments is showing today. Our focus remained stuck in political problems and repeated emergencies.

Lakhs of Pakistanis do enter schools, colleges and universities. They spend sixteen years inside the system, get a degree and then enter the market. But when they reach the market, they realise that the skills they have are not useful enough for the work that actually exists. This does not mean that Pakistanis are not intelligent.

We are normally taught that this is the problem and this is its solution. So if you give someone both the problem and its solution, he might execute it very well. But if you only give him the problem and ask him to figure out the solution himself, that is where we struggle.

And I think critical thinking is the new education. And AI will make this even more important. And when AI models become cheaper, a lot of the manual office work people expected to do after getting their degrees will slowly get replaced. So the degree itself will not give you an edge, and you will need to know how to think, communicate, manage people, solve problems or build something that AI cannot simply do for you.

The people who are progressing are mostly the ones who came out of that system, took a few dhakkay, learned from the internet and rebuilt their skills themselves.

So the verdict for education is critical.

But education only tells us how many capable people a country is producing. The next question is what happens to those capable people once they are produced. Do their skills become useful technologies, products and businesses? Or do they remain people with degrees who are trying to find a job? That takes us to the second vital: innovation.

Pakistanis Produce More Than the System Allows

Innovation is basically the conversion of talent into something useful. Ray Dalio does not judge innovation only by looking at how talented the people are. He looks at input and output. Input means how much a country is investing in education, research, infrastructure and new ideas, and output means how many useful technologies, patents, products and successful businesses are actually coming out of those investments.

According to the 2025 Global Innovation Index, Pakistan ranked 99th out of 139 countries. On innovation input, Pakistan ranked 124th, but on innovation output, Pakistan ranked 75th, and we also ranked 17th in mobile app creation and 18th in ICT exports. In simple words, Pakistanis are producing much more than the system is allowing them to produce. And this is one genuinely positive thing in the whole report, and I do not want to ignore it just because the rest of the picture is negative. But this positive sign also shows where our next problem starts.

Pakistanis are very good at doing freelance or service-based work. But we rarely move from providing the service towards owning the product. And this is not only because Pakistanis do not think big enough. The system needed to support that move barely exists. Now imagine that a very large software company is built inside Pakistan. It becomes so big that experienced talent from other countries comes here to work in it, and local people enter that company and learn how proper hiring works, how products are built, how teams are managed and how a large company actually operates.

But in Pakistan, the moment we produce someone capable of building something at that level, that person normally leaves. They go abroad for a degree, start working in Silicon Valley or somewhere similar, and slowly their main priority becomes making sure that they never have to return to Pakistan. The bigger loss is the complete ecosystem which could have been created under that person.

India has built more incentives for some of its talent to return with its money, resources and experience. It has around one hundred unicorns, which are companies valued at more than a billion dollars. Thousands of local people work inside those companies, and they learn under people who have already built something large, so when they come out, they are more capable of building better companies and products themselves. That loop keeps repeating, and that is how their ecosystem continues to grow.

We do not have enough of that loop in Pakistan. So my verdict for innovation is weak. I could have called it critical, but I did not, because that gap between our input and output is a real positive sign.

But suppose we somehow improve education and start producing better companies and products. There is still another question. Why would that talent and money stay in Pakistan? People do not only look for opportunity. They also look at whether their work, property and investments will remain safe, and for that, they need a stable rule of law.

The Written Law and the Law That Actually Works

You go to a government office for completely legal work, and the person sitting there is already being paid by the government to complete that work, but he will still tell you how much extra money it will cost to get it done.

In a rule-based system, the taxes can be high, the paperwork can be frustrating and it might take time, but you know that if you follow the written process, your work will eventually be completed. In a relationship-based system, the written rule is only the first layer, and the second and more important layer is who you know and how much money you can pay.

According to the 2025 World Justice Project Index, Pakistan ranked 130th out of 143 countries. We ranked 127th in regulatory enforcement, 129th in civil justice and 143rd out of 143 in order and security, which means we were last.

Now think about the same problem from the perspective of a business. A foreign company wants to invest in Pakistan, so we create a ten-year policy to attract it, and the company comes here, invests heavily, builds factories, hires people and takes losses during the early years. Then the ten years are completed, and this is the point where the company is finally expecting to start earning a proper return, but suddenly the regulations change and all the planning that company did becomes useless.

And on top of that, we have the repeated IMF cycle. We take one plan and fix three things while damaging two others, and then during the next programme, we fix those two things and damage the earlier three again.

But there is another effect of relationship-based law which the data does not show, and that is what it does to the things we value. A skilled businessman who could teach you something, build your career and pay you properly might struggle to attract people. But the same people will work for free under an MPA or MNA, take his abuse and accept being humiliated, only so they can later tell four people that they know him.

Not everyone can hold actual power, so the next closest thing is being near the person who has it, and because our system rewards these relationships, people keep chasing proximity to power instead of building actual skills and value. Power is probably the biggest nasha in Pakistan.

So the verdict for rule of law is critical.

Now connect the first three vitals. Weak education means we produce less capable talent, weak innovation means even the talent we produce does not turn into enough products and companies, and weak rule of law pushes that talent and money out of the country. And where does the damage from all of this finally appear? Inside the economy.

The Economy is Where the Damage Becomes Visible

We normally discuss Pakistan's economic problem as if the economy itself is the root cause. But according to this framework, the economy is not where the problem starts, it is where all the earlier problems finally become visible. When education is weak, we produce fewer capable people, and when innovation is weak, we produce fewer useful products and companies. And when rule of law is weak, businesses remain small, investment stays away and talent leaves. As a result, we produce less, export less and collect less tax.

Then the country has to borrow, because it cannot run everything through the money it is producing itself. Debt is a major part of Ray Dalio's framework. His argument is that when countries borrow beyond their ability to produce and repay, they enter a cycle which becomes harder and harder to escape. But America has one advantage that we do not have, which is that the US dollar is the main reserve currency of the world.

We need dollars to purchase oil and many of the other things we import, but we do not produce enough dollars through our exports. Pakistan's debt was around 70% of GDP, and a major part of our budget was going into debt payments.

Our cycle normally works like this. When the economy starts improving, people and businesses begin importing more, and more dollars start leaving the country than we are earning through exports. Our reserves fall, the rupee comes under pressure and inflation starts increasing. After some time the reserves improve and inflation comes down, so we start believing that the economy has finally been fixed. That is the good times and bad times cycle we discussed at the start.

Remittances also help us survive this cycle, and the number is around 30 billion dollars, which is real and important money. But sending more Pakistanis abroad so they can send dollars back home cannot be the complete economic model of a country.

So this is not a five-year political project. It probably needs fifteen, twenty or even twenty-five years of consistent direction, but our political parties arrive with five-year plans. So the verdict for the economy is also critical.

But even if a government somehow creates a proper twenty-year plan, there is still one final problem. Will the people support that plan for twenty years, especially when they might not personally receive its benefit? That is where social trust comes in.

The Part No Government Can Fix Alone

Social trust is basically whether people are willing to work together for something bigger than their own immediate benefit. Ibn-e-Khaldun explained a similar idea through asabiyyah, which according to him is people working together for the strength and progress of their group or nation.

But in Pakistan, we normally do the opposite. First we think about ourselves, then our family, then the people we personally know, and the system and everyone else come after all of that.

For example, suppose you know someone who can move your file ahead of everyone else. And most of us will use that contact, and then we will justify it by saying that the system is already broken anyway, and if I do not use this opportunity, somebody else will. But this is exactly how the system remains broken.

You use your contact, and someone watching you learns that this is how things work here. Then he does the same thing when he gets a chance, and the complete chain continues. So the actual sacrifice is very small but also very difficult: I have a contact, and I can get my work done today, but I will not use him because someone else has the legal right to go before me.

I wanted to give Pakistan a weak verdict on social trust, because we do come together during floods, earthquakes and other calamities, and Pakistanis can be extremely generous when a major emergency comes. But that is also where the problem is. We come together after the emergency has already happened, and we do not work together during the ten or fifteen years in which that emergency could have been prevented. So the verdict for social trust is also critical.

What This Means for Pakistan's Next 30 Years

So the final result is one weak and four criticals. Education is critical, innovation is weak, rule of law is critical, the economy is critical and social trust is critical. Education affects innovation, and innovation needs rule of law, and the condition of all three shows up in the economy. And none of them can improve for decades without social trust. So if the complete chain remains broken, the compounding will keep happening in the wrong direction.

To reverse it, we have to start thinking in twenty, thirty and forty-year periods. The goal should be that the generation standing here forty or fifty years from now sees a better Pakistan than what you and I are seeing today. And honestly, I do not think this can be fixed in one or two generations. It probably takes at least three or four.

The responsibility starts with our generation, because we are old enough to understand what is wrong but still young enough to change some of the things we do. Your child will see whether you respected someone else's right, whether you used your contact to break the system and whether you only thought about your own benefit. And the younger generation will learn more from our actions than from our lectures.

I say the same thing when I talk about investing: your thinking has to be long term. So if money itself needs decades to compound, how can we expect a generation, a country or a whole qaum to be fixed within five or ten years? But someone has to start it.