One of the most important features of President Musharraf’s government has been the revival of economy by creating atmosphere conducive to foreign investment.
When Gen. Pervez Musharraf took over, the country owed over $25 billion to foreign creditors. Debt servicing used to take away a major chunk of the annual budget. Most of these debts had accumulated during the reign of Benazir Bhutto and Nawaz Sharif. Between 1947 and 1970, Pakistan had a foreign debt of only $3 billion.
International donors had praised the country as particularly credit-worthy. During the reign of Bhutto and Zia massive loan was taken and by 1988, the foreign debt stood at $13 billion.
In only one decade, Benazir Bhutto and Nawaz Sharif doubled that debt to over $26 billion. The money was used for major infrastructure projects like the motorway between Islamabad and Lahore. Some money, however, remained unaccounted for.
Corruption among the upper political and administrative echelons were rampant during the reign of the two prime ministers. Pakistan was on the verge of being declared a failed state and a defaulter. During this period of chaos and anarchy Gen. Musharraf took over the country.
When Musharraf came to power, majority of the people felt relieved. The current government’s wide-ranging structural reforms, prudent macroeconomic policies, financial discipline and a consistency and continuity in policies have transformed Pakistan into a stable and resurgent economy.
Foreign debts have been reduced by $6bn in the last three years. Foreign currency reserves stand at an all-time high of almost $13bn. The Karachi Stock Exchange (KSE), which has never crossed 2,000 points since the creation of Pakistan, is almost touching 6,000 points.
The progress shows that Pakistan is moving in the right direction as the government is spending substantially to provide an infrastructure to facilitate and help private sector investments.
Pakistan’s economy has made significant progress over the last five years and the growth rate would be higher than the target of 6.6 percent of GDP.
Prime Minister Shaukat Aziz has been instrumental in making a broad-based economic recovery, which has gathered momentum, macro-economic stability has been achieved and the external balance of payments is much stronger today than ever before.
The PM has forecast the economic growth to accelerate to 7 and 8 percent per annum over the next three to four years with the private sector playing the leading role.
Pakistan’s industry has the potential to compete in the world, but there is a need to work with dedication and commitment taking advantage of liberal economic policies and open competition provided by the present government.
Due to the liberal economic polices marked by an investment-friendly atmosphere, Pakistan is increasingly becoming an ideal place for investors and industrialists.
Significant foreign investment is taking place in oil and gas sector in Pakistan as a result of special emphasis being given to infrastructure development.
The recent confidence-building measures between Pakistan and India have led to a 30 percent increase in Indo-Pak bilateral trade. Pakistan’s exports have increased by 22 percent in 2003-04 compared to the previous year.
In an analysis conducted by Indian PHD Chamber of Commerce and Industry (PHDCCI), it was said that the trade between the two countries has the potential to grow exponentially since the trade that is taking place through the non-official route and through third countries would then be official.
Prime Minister Shaukat Aziz held friendly talks with his Indian counterpart Manmohan Singh but insisted that progress in bilateral ties hinged on a solution to Kashmir.
“We can use the resources once we settle our disputes with neighboring countries”, said Prime Minister Aziz.
Aziz, on his first official visit to India, told reporters he and Manmohan Singh had covered bilateral and regional topics, including a proposed natural gas pipeline from Iran to India via Pakistan.
Pakistan would like India to participate in the project.
Meanwhile, a six-member Chinese delegation visited Pakistan and evinced keen interest in Pakistan Steel Mills expansion project.
Yang Mingde, the vice president of China Metallurgical Construction Corporation (MCC) informed that the MCC was a large state-owned Chinese corporation that had carried out construction of many strategic steel production bases like Baosteel Complex of Shanghai and Anishan Steel Works.
Pakistan welcomed their investment offer as Pakistan is pursuing a liberal industrial policy aimed at attracting investments both local and from abroad through joint collaborations.
The present government is committed to creating an investors-friendly environment with a special focus on further opening up the economy and marketing potential for direct foreign investment.
Yang Mingde, the head of the Chinese team, appreciated the economic reforms introduced by the current government during the last five years. He said Pakistan, now, offered great incentives and environment conducive to foreign investment.
The business community should take full advantage of investment friendly policies and work hard, invest more and make competitive products to compete in the world market.
The government is trying to project Pakistani products amongst the potential international buyers and investors.
A committee comprising federal ministers has been formed that would formulate a strategy to attract foreign investment.
More than 18.1 percent growth rate has been recorded in large-scale manufacturing in the first three months of current fiscal year and a robust performance has been witnessed in services sector.
In the first quarter of current fiscal year, there has been a strong rebound in investment, particularly in private sector, relatively low inflation and an investment-friendly interest rate.
The foreign exchange reserves are in comfortable position and exchange rates remained stable more or less during the first quarter of the current fiscal year. On the whole, Pakistan’s economy have been doing just fine so far and there are indications that like last year, will perform very well in many areas.
The prime minister has urged the business community to make every effort to find new markets for exports.
Industrial growth would automatically bring down the unemployment graph and create job opportunities.
Prime Minister Aziz has announced a comprehensive agenda for an overall socio-economic development, poverty alleviation, employment generation, speedy dispensation of justice, improvement of law and order and increased agricultural and industrial production.
The prime minister has a vision. He wants to see Pakistan as a great country in the comity of nations. Pakistan is a country of hundred and fifty million people and is a nuclear power, let’s prove with hard work and dedication that we can are a great nation.
