Allama Iqbal Open University Islamabad: Course

ALLAMA IQBAL OPEN UNIVERSITY ISLAMABAD
LEVEL: M.SC (PAK STUDY) SEMESTER: Autumn 2022

COURSE: Economic Development in Pakistan-II (4660)
Course: Economic Development in Pakistan-II (4660)
Assignment -02
Q.1 What were the major determinants of economic development during 1970, in Pakistan?
Discuss in detail.
Ans- Since independence in 1947, the economy of Pakistan has emerged as a semi-
industrialized one, the on textiles, agriculture, and food production, though recent years have
seen a push towards technological diversification. Pakistan's GDP growth has been
gradually on the rise since 2012 and the country has made significant improvements in its
provision of energy and security. However, decades of corruption and internal political
conflict have usually led to low levels of foreign investment and underdevelopment.
Historically, the land forming modern-day Pakistan was home to the ancient Indus Valley
civilization from 2800 BC to 1800 BC, and evidence suggests that its inhabitants were skilled
traders. Although the subcontinent enjoyed economic prosperity during the Mughal era,
growth steadily declined during the British colonial period. Since independence, economic
growth has meant an increase in average income of about 150 percent from 1950 to 1996,
But Pakistan like many other developing countries, has not been able to narrow the gap
between itself and rich industrial nations, which have grown faster on a per head basis. Per
capita GNP growth rate from 1985 to 1995 was only 1.2 percent per annum, substantially
lower than India (3.2), Bangladesh (2.1), and Sri Lanka (2.6).The inflation rate in Pakistan
has averaged 7.99 percent from 1957 until 2015, reaching an all-time high of 37.81 percent
in December 1973 and a record low of -10.32 percent in February 1959. Pakistan suffered
its only economic decline in GDP between 1951 and 1952.
Overall, Pakistan has maintained a fairly healthy and functional economy in the face of
several wars, changing demographics, and transfers of power between civilian and military
regimes, growing at an impressive rate of 6 percent per annum in the first four decades of its
existence. During the 1960s, Pakistan was seen as a model of economic development
around the world, and there was much praise for its rapid progress. Many countries sought
to emulate Pakistan's economic planning strategy, including South Korea, which replicated
the city of Karachi's second "Five-Year Plan."
Ancient History
Indus Valley Civilization
The Indus Valley civilization, the first known permanent and predominantly urban settlement
that flourished between 3500 BC to 1800 BC, featured a vibrant economic system. Its
citizens practised agriculture, domesticated animals, made sharp tools and weapons from
copper, bronze, and tin, and traded with other cities. [4] Archaeological excavations have
uncovered streets, drainage systems, and water supplies in the valley's major cities
of Harappa, Lothal, Mohenjo-daro, and Rakhigarhi, revealing an advanced knowledge
of urban planning.
View of Mohenjo Daro towards the Great Bath (circa 2500 BCE)
Although civilization had several urban centers, much of the population resided in villages,
where the economy was largely isolated and self-sustaining. Agriculture was the
predominant occupation, as it helped satisfy the villages' food requirements while also
providing raw materials for cottage and small scale industries like textiles and handicrafts.
Besides farmers, other occupational groups included barbers, carpenters, doctors
(Ayurvedic practitioners), goldsmiths, weavers, etc.
Through the joint family system, members of a family often pooled their resources to sustain
themselves and invest in business ventures. The system ensured that younger members
were trained and employed in the family business, while the elderly and disabled were
supported by their families. This also prevented agricultural land from being split and reaped
a higher yield due to the benefits of scale.
Achaemenid Empire
In 518 BCE, The Achaemenid Empire conquered regions of modern day's Pakistan. The
conquered area was the most fertile and populous region of the Achaemenid Empire. An
amount of tribute was fixed according to the richness of each territory. The province of
the Hindush ('Ινδοι, Indoi) was the Achaemenid district paying the largest tribute, and alone
represented 32% of the total tribute revenues of the whole Achaemenid Empire. It also
means that Indos was the richest Achaemenid region in the subcontinent, much richer than
Gandara or Sattagydia.
Mauryan Empire
During the Maurya Empire (c. 321–185 BC), there were a number of important changes and
developments in the economy of the region. For the first time, most of Indian subcontinent
was unified under one ruler. With an empire in place, trade routes became more secure,
thereby reducing the risks associated with the transportation of goods. The empire spent
considerable resources building roads and maintaining them throughout the region. The
improved infrastructure, combined with greater security, uniformity in measurements, and
the increasing usage of coins as currency, all enhanced trade.
Kushan Empire
After Mauryan Empire, the region came under control of Indo-Greek Kingdom, under which
economy was rather vibrant as evident by their coins, art and
architecture. Afterwards Kushan Empire gained control in 1st century AD and the region
prospered under them
Q.2 Discuss the impact of Pakistan’s commercial policy on its balance of payments situation.
Ans- Balance of payments problem primarily in the form of current account

deficit is one of the major issues faced by Pakistan’s economy.
It is the root cause behind the inflation and growth problems. Inflation rises when the rupee
depreciates due to the current account deficit and similarly growth above 4% becomes
unsustainable as the jaws of current account start to widen.
So, it seems very important to understand the overall evolution of Pakistan’s imports,
exports and remittances.
For this purpose, let’s compare the numbers of FY2022 with FY2004. The reason for this
comparison is that year 2004 is one of those rare occurrences wherein Pakistan experienced
a current account surplus.
We need to see how trade and remittances progressed from this historical juncture onwards.
Let’s discuss imports of goods first. Total import bill during this period (2004-2022) has
increased from $13.6 billion to $72.05 billion. This is a mammoth increase of 430%.
Pakistan’s population in this period has increased by almost 50% (156 million to 236
million). So, 430% increase in imports is largely out of line.
For further analysis, we will see the growth in per capita terms of significant import groups.
The largest absolute growth (728%) is in the petroleum group wherein imports increased
from $2.3 billion to $18.7 billion. Although prices in this period increased by almost 200%,
the remaining volumetric increase is still too much.
Per capita petroleum imports increased by 450%, which is extremely high given 50% rise in
population. If we adjust for a 200% rise in prices, even then petroleum imports have risen by
250% in the last 18 years on per capita basis.
This is one of the major causes of the problem. The solution is maximum shift towards solar
and other alternative energy avenues.
The most alarming situation after petroleum is to be witnessed in the food group. Pakistan
being an agricultural country should not be importing food items amounting to $7.9 billion
in FY22 (FY04: $1.4 billion). This includes palm oil imports of $3.2 billion.
On per capita basis, imports of this commodity have increased by 218%. The major
contribution to this change seems to have come from prices, which have increased by almost
300%.
However, we need to substitute these imports with indigenous products. It may take a few
years, but this is the only way forward.
Our per capita imports of dry fruits increased by 300%, per capita tea imports have
increased by 105% and per capita pulses imports have increased by 550%. We can surely
investigate import substitution for these items.
Similarly, imports of agriculture and other chemicals group increased to $10.7 billion,
growing by 288% in absolute terms and by 158% on per capita basis.
Here it is difficult to assess the price or volume contribution as a lot of items from fertiliser
to plastic are part of this group.
Pakistan’s machinery imports rose to $9.6 billion, up about 300% in the past 18 years.
Although on per capita basis machinery imports increased by 167%, we can consider them
good imports generally as they contribute to the productive potential of the country.
However, this import category also includes mobile phone imports, which have increased by
almost $1.6 billion during the period under consideration.
Transport group imports in this period increased by 368% in absolute terms and by 211% in
per capita terms. This is certainly something which we can try and minimise.
Cars’ CBU (completely built units) imports have increased by 600% in absolute terms and by
366% on per capita basis. Similarly, cars’ CKD (completely knocked down units) imports
have increased by 384% in absolute terms and by 222% on per capita basis.
This is where it seems that we are lavishly living beyond our means. But the rise in these
imports is partially caused by a lack of public transport system.
The government should give public transport to the people so that this bleeding can be
arrested. The public transport system will help in reducing petroleum imports also.
Textile group imports have increased by 432% in absolute terms and by 254% in per capita
terms. This is also alarming as textile exports in the corresponding period have increased by
only 132% in absolute terms and by 50% on per capita basis.
This is something that must be probed. Previously, textile group was importing materials
worth $1 for every $8 worth of exports. Now, textile sector is importing material worth $1 for
every $3.2 worth of exports. This means that net exports of textile have declined significantly
over time.
Total imports of Pakistan have increased by 450% in absolute terms and by 252% on per
capita basis. This is the major problem causing balance of payments crisis. In the next
article, we will try and understand the evolution of exports and remittances.
Q.3 On the basis of rather obvious assumptions that more goods and services are preferred
to less, we may consider an increase in real national income as a necessary condition for all
increase in Economic welfare. But it is not by itself a sufficient condition. Explain the statement
in detail.
Ans-
Good health, a place to live, access to education, nutrition, social connections, respect,
peace, human rights, a healthy environment, happiness. These are just some of the many
aspects we care about in our lives.
At the heart of many of these aspects that we care about are needs for which we require
particular goods and services: think of those that are needed for the goals on that list above
– the health services from nurses and doctors, the home you live in, or the teachers that
provide education.
Poverty, prosperity, and growth are often measured in monetary terms, most commonly as
people’s income. But while monetary measures have some important advantages, they have
the big disadvantage that they are abstract. In the worst case monetary measures – like
GDP per capita – are so abstract that we forget what they are actually about: people’s
access to goods and services.
The point of this text is to show why economic growth is important and how the abstract
monetary measures tell us about the reality of people’s material living conditions around the
world and throughout history:
 In the first part I want to explain what economic growth is and why it is so difficult to
measure.
 In the second part I will discuss the advantages and disadvantages of several
measures of growth and you will find the latest data on several of these measures so
that we can see what they tell us about how people’s material living conditions have
changed.
What are these goods and services that I’m talking about?
Have a look around yourself right now. Many of the things you see are products that were
produced by someone so that you can use them: the trousers you are wearing, the device
you are reading this on, the electricity that powers it, the furniture around you, the toilet that
is nearby, the sewage system it is connected to, the bus or car or bicycle you took to get
where you are, the food you had this morning, the medications you will receive when you get
sick, every window in your home, every shirt in your wardrobe, and every book on your
shelf.
At some point in the past many of these products were not available. The majority did not
have access to the most basic goods and services they needed. A recent study on the
history of global poverty estimates that just two centuries ago roughly three-quarters of the
world “could not afford a tiny space to live, food that would not induce malnutrition, and some
minimum heating capacity.”1
A few centuries ago the only way to produce a book was for a scribe to copy it word-for-
word, by hand. Book production was a slow process; it took a scribe about eight months of
daily work to produce a single copy of the Bible. 2
It was so laborious that only very few books were produced. The chart shows the estimates
of historians.3
But then in the 15th century the goldsmith Johannes Gutenberg combined the idea of
movable letters with the mechanism that he knew from the wine presses in his hometown.
He developed the printing press. Gutenberg developed a new production technology and it
changed things dramatically. Instead of spending months to produce one book, a worker
was now able to produce several books a day.
As the printing press spread across Europe, book production soared. Books, which were
previously only available to a tiny elite, became available to more and more people.
This is one example of how growth is possible and what economic growth is: an increase in
the production of goods and services that people produce for each other.
A list of goods and services that people produce for each other
Before we get to a more detailed definition of economic growth, it’s helpful to remind
ourselves of the astonishingly wide range of goods and services that people produce. I think
this is helpful because measures of economic output can easily become abstract. This
abstraction means we easily lose the mental connection to the goods and services such
measures actually talk about.
This list of goods and services isn’t meant as a definitive list, but it helped me to think about
the relevance of poverty and growth: 4
At home: Light in your home at night; the sewage system; a shower; vacuum cleaner;
fridge; heating; air conditioning; electricity; windows; a toilet – even a flush toilet; soap; a
balcony or a garden; running water; warm water; cutlery and dishes; a hut – or even a warm
apartment or house; an oven; sewing machine; a stove (that doesn’t poison you); carpet;
toilet paper; trash bags; music recordings or even online streaming of the world’s music and
film; garbage collection; radio; television; a washing machine; 5 furniture; telephone; a
comfortable bed and a room for one’s own.
Food: The most fundamental need is to have enough food. For much of human history a
large share of people suffered from hunger and millions still do.
But we also need to have a richer and varied diet to get all of the nutrients we need,
unfortunately billions still suffer from micronutrient deficiency.
Also, think of clean drinking water; reliable markets and stores with a wide range of available
goods; food that rarely poisons you (pasteurized milk, for example); spices; tea and coffee;
kitchen utensils and practical ingredients (from a bag of flour to canned soups or a yogurt);
chocolate and sweets; fresh fruit and vegetables; bread; take-away food or the possibility to
go to a restaurant; ways to protect your food from spoiling (from the cold chain that delivers
the goods to the cellophane to wrap it with); wine or beer; fertilizer (very important); and
tractors to work the fields.
Knowledge: Education from primary up to university level; books; data that allows us to
understand the world around us; newspapers; vocational training; kindergartens; and
scientific knowledge to understand ourselves and the world around us.
Infrastructure: Public transportation with buses, subways, and trains; roads; paved roads;
airplanes; bridges; financial services (including bank accounts, ATMs, and credit cards);
cities; a network of competent workers that can help you to fix problems; postal services
(that delivers fast); national parks; street cleaning; public swimming pools (even private
pools); firefighters; parks; online shopping; weather forecasts; and a waste management
system.
Tools and technologies: Pencils, ballpoint pens, and paper; lawnmowers; cars; car
mechanics; bicycles; power tools like drills (even battery-powered ones); a watch; computers
and laptops; smartphones (with GPS and a good camera); being able to stay in touch with
distant friends or family members (or even visiting them); GPS; batteries; telephones and
mobiles; video calls; WiFi; and the internet right here.
Social services: Caretakers for those who are disabled, sick, or elderly; protection from
crime; non-profit organizations financed by the public, by donations or by philanthropies;
insurances (against many different risks); and a legal system with judges and lawyers that
implement the rule of law.
There are also a wide range of transfer payments, which in themselves are not services
(they are transfers), but which become more affordable as a society becomes more
prosperous: sick leave and disability benefits; unemployment benefits; and being able to
help others with a regular donation of some of your income to an effective charity.6
Life and free time: tents; travel and holidays; surfboards; skis; board games; hotels;
playgrounds; children’s toys; courses to learn hobbies (from painting to musical instruments
or courses on the environment around us); a football; pets; the cinema, theater or a music
concert; clothes (even comfortable and good-looking ones that keep you warm and protect
you from the rain); shoes (even shoes for different purposes); shoe repair; the contraceptive
pill and the ability to choose if and when to have children; sports classes from rock climbing
to pilates and yoga; cigarettes (not all goods that people produce for each other are good for
them);7 a musical instrument; a camera; and parties to celebrate life.
Health and staying well: Dentists; antibiotics; surgeries; anesthesia; mental health care
from psychologists and psychiatrists; vaccines; public sewage; a haircut; a massage;
midwives; ambulances; modern medicine; band-aids; pharmaceutical drugs; sanitary pads;
toothbrushes; dental floss (some do floss); disinfectants; glasses; sunglasses; contact
lenses; hearing aids; and hospitals – including very well-equipped, modern hospitals that
offer  CT scans, which include intensive care units and allow heart or brain surgery or organ
transplants.
Specific needs and wishes: Most of the products listed above are generally helpful to
people. But often the goods and services that are most important to one individual are very
specific.
Q.4 Compare and contrast the prospects and future directions of the sixth and seventh five
year plan.
Ans- Before the end of Fifth Five Year Plan preparation for Sixth Five Year Plan was made.
NEC approved the Plan well in time and implemented according to its schedule.
Size of the Plan:

The plan aimed at a financial outlay of Rs. 495 billion which was more than double the
amount of Fifth Five Year Plan. Rs. 295 billion were decided to spend in the public sector
and Rs. 200 billion were decided to spend in private sector. As regard to the proposed
resources to finance the Plan two points were important:
(a) The share of net external resources in the gross investment would fall from 24%
to 16% in the Sixth Five Year Plan.
(b) The compensating efforts in the domestic front were expected in the private
sector, almost quadrupling the total private savings with little change in the size of the
public savings.
Objectives:
(a) To make production sector of the economy powerful and stable.
(b) To accelerate the rate of economic development so that the standard of living of
the people may be raised.
(c) To increase the agriculture production by using more fertilizers, better seeds and
modern technology.
(d) To make the country self-sufficient in oil.
(e) To develop steel based engineering goods, modernisation of textiles, expansion
of agro-based industries, etc.
(f) To provide maximum social services to increase the rate of literacy and to
provide drinking water facilities, draining water facilities, etc.
(g) To create harmony among different sectors of the economy.
Targets:
(a) To increase GDP by 6.5% p.a.
(b) To increase family income by Rs. 900 p.a.
(c) To increase agriculture production by 5% p.a.
(d) To increase industrial production by 9% p.a.
(e) To provide jobs to 4 million people during the Plan period.
(f) To provide facilities of electricity to 88% of the village population.
(g) To increase exports from $ 2.43 billion to $ 4.91 billion by the end of the Plan.
(h) To construct 15000 km new roads from villages to cities.
(i) To lower dependence on foreign aid from 20 to 19% by the end of the Plan.
(j) To increase the efficiency of private sector, certain effective measures would be
taken so that private sector may play its role effectively in the development of the
economy.
(k) To enable 3 million acres of land for cultivation which had been destroyed by
water logging and salinity.
It was decided to allocate 18.1% of the total expenditure to agriculture and water sector,
20% to power, 18.1% to transportation, 15.6% to industry 12.2% to minerals and 11.5% to
social institutions. See the table below:
Sector-wise Division of Expenditure

(Rupees in billions)
Sectors Total Percentage of
Expenditure Total
Agriculture and Water 89.72 18.1
Sources of Power 100.00 20.0
Transportation 89.62 18.1
Industry 76.91 15.6
Minerals 6.05 1.2
Social Institutions 59.91 11.5
(health, education, etc.)
Other Sectors 75.79 15.3
Total 498.00 100.0
Strategy:
(a) High Growth Momentum: High rates of growth of GDP and other related macro
economic variables are to be maintained:
(i) Emphasis on increased efficiency in agriculture, particularly self
sufficiency in oil seeds, expanding the exports of rice, cotton and fruits, etc.
(ii) Balanced development of service industries, especially public services
for basic human needs.
(iii) Balanced development of service industries, especially of private
services for government servants and private people.
(b) Rural Transformation: Increased opportunities for small farmers and provision
of infrastructure.
(c) Employment and Income Policies: Creation of about 4 million new jobs for
emphasis on small scale production in agriculture and industry, rural works
programme, vocational training with combination, income policy which related wages
to productivity, indicated salaries from fixed income growth.
(d) Decentralisation: To increase share of provincial governments in development
programme of public sector and also encouraging to local bodies to participate in
investment plans.
(e) Backward Regions: Recognition of the tribal and Balochistan as economically
backward regions and provision of special funds for specific development
programmes in these regions.
(f) Self Reliance: Continuing import substitution and export promotion policies and
reducing dependence on foreign aid.
Performance of the Plan (Failure and Achievements):

During the Plan period, GDP was expected to increase by 6.5% p.a. It was based on the
performance of agriculture and manufacturing sectors. Because these sectors could not
play their role effectively so the plan seemed helpless in achieving the targets and
objectives.
Further aggregate growth rate of GNP and GDP were related to expected increase in the
rate of savings and investment during the Plan period. The savings were expected to
increase from 13% to 25% in Plan period and investment rate from 6.5% to 7.5% p.a. But
unfortunately these targets could not be achieved in the Sixth Five Year Plan.
Rate of net borrowing and net real foreign saving was expected to decline (because of the
decline in foreign remittances). It was decided to increase domestic savings because the
Plan did not present any argument or evidence how the saving rate would increase and how
much to be saved by the private sector. Basic problem with the plea was shortfall in
remittances. Minor crops grew by only 3.6% p.a. as against a growth rate of 7% p.a.
envisaged in the Plan.
The Sixth Five Year Plan was a mixed success. It was described as a qualified success by
Planning and Development Division. It fulfilled most of the targets, though there were some
failures. On the whole, it was a good plan.
Q.5 What are the causes of Adverse Balance of Trade in Pakistan? Suggest the possible
measure to improve the Balance of Trade of Pakistan.
Ans-
Pakistan’s economic growth of Pakistan is dependent on its exports by earning foreign income to
finance imports, service debt, stabilize its currency and to overcome the persistent problem of the
balance of payment deficit. In addition to being competitive, a country’s exports should be in line
with market trends and quality, and be certified on internationally acceptable standards.
In Pakistan, the investments required to bolster Pakistan’s exports are short in supply. Pakistan’s non-
conducive investment environment stems from uncertainty. Volatility of output growth is an indicator
of the unpredictability of demand and volatility of inflation is an indicator of macroeconomic
uncertainty. These indicators have been found to adversely impact investments, especially private
investments. The Tax, Investment and Exports (T.I.E) nexus is essential for guaranteeing the desired
level of growth in an economy. T.I.E. as a percentage of GDP has declined substantially in Pakistan in
recent years and has thus negatively impacted growth.
Lack of investment is one of the core reasons why Pakistan’s growth in exports has been negative
over a 10-year period. Other reasons include higher tariff structure, erratic growth trends, low
penetration in global markets, lack of infrastructure and technological advancement. Furthermore,
exports are also handicapped by government’s irrational policies and complex incentives offered to
industry. Other competing Asian countries have managed growth by pursuing export led growth
strategies with high savings and investment rates, specializing in areas of competitive advantage, and
resulting in rapid industrialization. The questions is: how can Pakistan increase exports for sustainable
economic growth?
Difficult times demand innovative thinking, and out-of-the-box solutions
Pakistan needs to capitalize on exportable services and products requiring minimal infrastructure and
investments. For example, there is a growing global demand for software and IT solutions. It is easier
to establish a software house than to set up a manufacturing unit. Analysts predict global Software
Engineering Market to develop at an 11.72% CAGR between 2016 – 2022. We accredit the vigorous
growth of the software market to the growing demand for automation from different industries to
enhance their program manufacturing processes and design quality.
Pakistan’s IT exports increased by 44% to USD 379 million during the first quarter of the fiscal year
2020-21, and there is a lot of potential to grow more and explore avenues to enhance software export.
India’s information technology and back-office sector will grow by 7.7% in fiscal 2020 to USD 191
billion, with exports touching USD 147 billion. There is no shortage of talent in Pakistan. With
minimal efforts and support from the government, Pakistan’s IT sector can expand to contribute USD
1 billion annually. The Trade Development Authority of Pakistan (TDAP) should note this fast-
changing reality and leverage artificial intelligence and big data to help exporters harness the potential
of online marketing platforms (World Bank).
Improving export competitiveness in the global market essential for increasing

Pakistan’s exports
Exports are a victim of protectionist tendencies which incentivize production for the domestic market
rather than global markets. A paradigm shift to provide incentives to industries to move their
production from low value to high value products is needed. For instance, global ratio for MMF to
Cotton is 70:30, whereas, Pakistan’s composition ratio is 30:70 owing to lack of prioritization or
incentivization by the government. Reforms to address this issue will exponentially enhance export
potential. Moreover, one key measure to make exports competitive is to ease import restrictions. For
instance, anti-dumping duty on Polyester Staple Fiber (PSF) will hurt the industry by increasing cost
of raw materials, rendering exports uncompetitive.
Empowering SMEs
The Pakistani economy comprises almost 3.3 million Small and Medium Enterprises. These may
comprise (amongst many other variants) service providers, manufacturing units and startups. SMEs
make up over 30% of Pakistan’s GDP and approximately 25% of generating exports. We need
policies that empower SMEs and allow them to reach their true potential. Offering access to finance,
easily available subsidized credit, lower interest rates on loans, LTFF for purchase/import of
machinery and skills training/development programmes can be a reasonable starting point to unleash
SME’s potential. Public procurement can potentially achieve outstanding economic and social
benefits by ensuring government supply chains include SMEs. Benefits range from creation of skilled
jobs, increased domestic tax revenue, to more robust domestic economic growth. Well-designed
public procurement policies also have the potential to catalyze technical development, increasing
trade margins, and overall productivity.
Improving the Duty Drawback Schemes
We can improve standard duty drawback schemes by: (a) making them accessible also to indirect
exporters and extending them to imported inputs used in production of exported final products; (b)
eliminating duty pre-payment for exporting firms in order to reduce credit requirements.
Simplifying Regulations
The government should simplify regulation related to exports; cumbersome bureaucratic procedures
negatively affect new exporters. At the same time, governments should improve information
collection and dissemination about foreign markets and requirements for exporting.
Entrepreneurship and Workforce Development
Improve the productivity and technological content of domestic goods, and provide incentives to
nurturing innovation, making Pakistani products globally competitive. For that to happen, we need
comprehensive focus on nurturing entrepreneurship. A UNDP National Human Development Report
has highlighted skilled unemployment level of 20% (college graduates) in Pakistan. Unemployment
levels remain high, with the ‘educated’ constituting a large proportion of the unemployed population.
With this state of employment, Pakistan cannot reap the economic returns required for economic
growth. The ease of doing business in Pakistan must be prioritized to encourage innovation for better
quality diverse products and services. Entrepreneurship creates a virtuous cycle of prosperity as the
people not only get employed themselves and create value for the society and the economy, but also
promote employment opportunities.

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ALLAMA IQBAL OPEN UNIVERSITY ISLAMABAD

LEVEL: M.SC (PAK STUDY) SEMESTER: Autumn 2022

Course: Economic Development in Pakistan-II (4660)

Ans- Balance of payments problem primarily in the form of current account

Size of the Plan:

Sector-wise Division of Expenditure

Performance of the Plan (Failure and Achievements):

Difficult times demand innovative thinking, and out-of-the-box solutions

Improving export competitiveness in the global market essential for increasing

Improving the Duty Drawback Schemes

Entrepreneurship and Workforce Development

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