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ASSIGNMENT

International business Analysis
Economy of Pakistan
Submitted by: Muhammad Arslan(01-120091-041)

Submitted to: Tariq Javaid Rajput

Bahria university Islamabad

But this can be only possible if government decrease the corruption rate and provide facilities to the businesses.4 to 1.6% due to Pakistan's political instability and weak law and order. Corruption rate is very high which doesn t allow investors to come in and do business in Pakistan. In addition. the government maintains insufficient buffer stock and it has no fund to manage the import and export of agricultural commodities. agriculture and other industries Gdp of Pakistan is decreasing and attaining the set limits. chemicals. It should be increase in term of quantity. Inflation is tremendously increasing. If private business in Pakistan flourish then there is a chance to foreign investment comes in. surpassing the government target of $4 billion. Millions of expenditure are made which are unproductive. Pakistan has achieved FDI of almost $8. Demand elasticity for power tends to be in the range 1. There is chance in private business. Savings can be encouraged by implementing program loans and by adopting institutional reforms. Government doesn t have the investments and resources to run the country so that loan is taken and burden of loans are increasing. Trade is increase in term of worth but not in term of quantity. Buying power of people is becoming less. foreign investment is very imp for the any economy of the country.5. Government is fail generate the income so that these loan can be refunded on the other hand government is not cutting its expenses. Pakistan s trade deficit is now between $12 . Recent governments have not taken any step which can benefit the economy condition of Pakistan. according to the Bank of Pakistan. the Pakistani government had not managed the country s agricultural sector properly and has failed to invest in the power sector.Pakistan s economic condition is in crisis in these years. Foreign investment had significantly declined by 2010.4 billion in the financial year 06/07. The poor management of the agricultural sector is further compounded by the smuggling of wheat into Afghanistan. dropping by 54.4% increase in demand for electricity for every 1% increase in GDP growth. food processing. Government can make economic condition better by providing facilities to the private business. Government have to pay attention of the energy crises because without this private business cannot work out. Increase Pakistan s Domestic Savings Rate: Pakistan cannot maintain a strong economic growth rate without considerable improvement in domestic savings since these savings will lead to increased investments in the economy. Energy crisis play a very important role to destroy the business in Pakistan. For instance. Trade condition of Pakistan is also not going well. the Pakistani government has not carried out a serious analysis of the impact of the country s economic growth on the increased demand for energy. Terrorist impact on Pakistan s economy is very negative. Pakistan has a semi-industrialized economy. Foreign investment is not coming in Pakistan. There is lack of resources in Pakistan. This means that there is a 1. Additionally. which mainly encompasses textiles.$13 billion. .

Decentralize Economic Decision-making in Pakistan: For instance. high growth rates in Punjab would have a positive impact on the entire economy. Punjab is a well-managed province and could easily achieve an economic growth rate of 10% if it is allowed to manage its own resources. Given that Punjab accounts for 60% of Pakistan s economy. There needs to be focused investment in education. Serve As a Regional Transit Route: Pakistan should be opened up as a transit route for the region. thereby creating tremendous opportunity for FDI.Invest in Human Resource Capital: Pakistan has one of the youngest populations in the world. . particularly at the primary and secondary school level and in technical schools.

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