Investigations of the determinants of poverty in developing countries over the last five decades have demonstrated that economic growth is necessary but not a sufficient condition for poverty alleviation.  A well functioning governance structure that mediates on behalf of the less well-to-do segments of the society, distributes the benefits of growth equitably and delivers access to basic public goods and services can lift people out of poverty.

The extent to which the governance structure is able to fulfil these functions, in turn, depends upon the quality of institutions entrusted with various tasks performed by the State.  Institutions – both formal and informal – derive their strength from the historical and cultural traditions and norms as well as the legal, financial and administrative structures. In Pakistan, these institutions have become dysfunctional due to a trend towards over-centralised personal and political concentration of powers by the elected and military governments.  Privilege, pelf and personal loyalty have trumped the objective, neutral, non-discriminatory characteristics of a responsive government.

This paper presents an agenda for long term reform of governance and institutions in Pakistan.  A selective approach in which eight key institutions, which we term as “Institutions of Restraint”, are restructured has a better chance of implementation than the whole comprehensive agenda.  A parliamentary discussion and approval of the restructuring plan of these institutions would ensure the continuity of the reforms transcending party lines.

It is argued that the longer these reforms are postponed the harder would become the task for revival of the State effectiveness and administration of justice, equitable growth and social cohesiveness.