in it’ Ww we s the best way and provide the various facilities to those industries in engaged in production and manufacturing of imported like goods. 1e opposition and actions of terrors will create a lot problem to discov import substitute. S\ Question >> EEE Balance of trade is a record of economic move! one country and the rest of the world during one year. Tr balance sheets must be balanced. The: items, which lead to, an ir earnings are placed’on the credit side of the balance sheet, ¥ give, rise to an outflow of foreign currency are placed on the debit side. Definitions: Balance of Tea “Balance of trade is the difference in value between t of visible items afd total imports of visible items only, of a nation during. SP of time, usually one year.” os According to Pas Taylo (Balance of trade is the difference between t value of a country's visible imports and exports *) Types of Balance of Trade: Balance of trade may be of three types: Negative 4, Surplus or Favourable BOT _ sp<$S 2. Equilibrium BOT _ sD=SS me sD>ss 3. Deficit or Unfavourable BOT Where: SD is demand for dollar (M) and SS i: Situation in Pakistan: Since independence, Pak deficit in its balance of trade. But the balance of ti only in following three fiscal years: i. 1947-48, ii, 1950-51 and ii, 197 & 4- Definition Balance of Trade (BOT) The BOT is the difference between the | The BOP is the di yalues of exports and imports of only | values of export physical items (goods) ‘of a country during | visible_and_invisible_tems agiven period of time (usually one year). | services) of a 6 | period of time ( 2- Surplus of Deficit ig is greater | If the value of the teta Balance of Payment (SOP) [if the value of visible expo le imports, the balance | than the total p: than value of visib! of trade is said to be favourable and vice | termed versa, [versaPAKISTAN’ $_ECONOMY cuapreR-15 3- Goods and Services 38 Trincludes only (visible) goods. Tt includes both (visible and invsiby goods and services. San ~~ # Revenue and Capital it includes all revenue receipts and | The BOP includes all revenue and capital payments on account of imports and | items . exports. 5- Relationship "The BOT does not include the BOP. Itis | The BOP includes BOT also. Accordingly, the part of BOP. itis equal to the BOT plus import & export of services 6- Economic Position It does not show the actual economic] Balance of payment shows the real position of a country. economic position of a country. Qveston => 5.1, Introduction. Balance of payments (BOP) is a record ‘of economic transitions between the residents of one country and the rest of the world during one year. The balance of payment like all balance sheets must be balanced. The Items, which lead to, an inflow of foreign earnings are placed on the credit side of the balance sheet, whereas the items, which give, tise to an outflow of foreign currency are placed on the debit side. rd of a nation’s total payment to Definiton,/Balence of payment is a systematic reco foreign countries, including the price of imports, the outflow of capital and gold, ‘and the total receipts from abroad, including the price of exports and the inflow of capital and ‘DTagrant Bafeitin Balance of Payment gold.” ' According to Pas Taylor: “Balance of payment refers to the difference between the total payments out of a * country during a given period of time. These payments are of visible and invisible items.” ea from E! to E? shows that demand In given diagram, ar xchange rate for dollar is greater than supply of dollar at e ER' and represents deficit in balance of payment. Demand for and ‘supply of Dollar 5.2, Situation in Pakistan. - - Pakistan, since independence, has been experiencing deficit (un-favourable) in e si. e., 1950-51, 4954-55, 1955-56, its balance of payment except the following five year: ‘ 5 * 4958-59, and 4959-60. In 1965-66, the balance of payment was highly deficit due to war aaainst India.( ; bye: . TRADE AND ECONOMIC DEVELOPMENT 307 Np, to date Situation: According to the Pakistan Economic Survey 2021-22, till July- March, imports of Pakistan are $ 54.3 billion and its exports are $ 25.6 billion. It is showing a deficit of $ 28.7 billion. The above situation is showing that nessa faces a continuous deficit in its balance of payment, These are the permanent causes of deficit in the & BOP: ATM 4._Natrow and slow export 1_Natrow_and_slow export_growth, rowth. Pakistan is basically an agricultural country, Its major exports are tice, cotton, raw wool, leather, fish, etc, Our exports, during the last five years, are remaining around $ 25 billior © § 30 billion. The reason is that our export base is narrow/It is concentrated in relatively low value added products, The value of exports during FY 2022 is $ 25.6 billlon. An amount of Rs 6 billion is allocated to operationalize trade policy, in the last "Federal Budget, : Consumption related: soclety, The people of Pakistan are mostly consumption - orlented. The domestic Manufactures 'd goods are mostly consumed in the country due to the rapid rise in population and incréased Consumption habity. The exportable surplus is sgoing to decline. The government has to import huge quantity of wheat and heavy amounts of sugar, pulses and tea in several years, being an agrarian country Less modernization of machinery. Since 1970's, there have been less modernization, balancing and replacement of machinery in the industtial sector. The fall in production and decline in the quality of products has adversely affected exporty. Many developing countries are depending on agriculture sector which is attached with a lot of natural calamities. It is reducing the export earnings from relevant cash crops. 4. Increase in the sick industrial units. The number of sick industrial units, mainly due to the nationalization of industries, has increased. t ison record that the performance of most of the industries in the public sector is not satisfactory. The decline in production a semi-manufactured and manufactured goods reduces the exportable surplus ant lume of trade. Se ition ofvalue added goods. The share of industry sector in the GDP is Ta Te trove tem nono en ey of value added goods must increase to earn foreign exchange and urn fos a eeise balance of payment/The production of value added goods is on basic stag of a i istan that leads to adverse BOP. | not helped & Fvaluation, The continuous devaluation of be ous ve cay Te faerie “in the i crease of exports. It has made the Imported Inputs m ut rupee is not an Be coats in the international market is elastic. Devaluation of our rup effective tool to boost exports ~ TE\ CHAPTER-15 PAKISTAN’ S ECONOMY 308 . Hard competition, Hard competition in the foreign market Particularly of our value) added goods has Teduced the volume Of foreign trade in Pakistary There is availability of ¥ higher standard goods at lower Prices in international market. exports, which result in deficit inthe Bory 8. Increase in prices of inputs. The inc; Capital costs of impo It causes a reduction in modem, conomy, there is less demand of raw material and semi-finished goods from developing Countries. It is reducing our nation exports. 10. Techni ‘al_barriers, Imposition @tc., has adversely affected our xports for the last years. The World have imposed technical barriers Such as patents, designs etc. on their im i hi standard of Purity and quality toc ete in the international larket, qo market. Political Uncertainty. The Political Uncertainties in the industrial units have. Considerably affected the efficiency of the dust The fallin the volume of Production, particularly in the manufacturing value ad ed sector has reduced export S2mnings. Our BOP is unfavourable due to reduction in export eamings A Fall in terms of trade. The Import unit values are higher than the export unit values for the last over three decades in the Pakistan. We are exporting primary goods and importing mariufactured goods. A decline in terms of trade causes imbalance in the balance of Payment. Terms of trade index points (base year 1990-91=100) of Pakistan: Perms of trade are 61.44 index points at present. Export Price Index sad Import Price Inde . Pakistan has obtained about $ 130.6 billion from different CLESuM mn . - : 7 eT a of eal joods.. Pakistan has to import capital goods for rapid ; r fi lization in order to build up the economy. The heavy import of machinery has ae a increased the import bill and has adversely affected balance of payment. consideral i jl it d inputs ip ry. f our industries are based on the importe |6tn rt-oriented industry. Some of . impo industries, which were established ; il and petroleum, etc. Most of in es, and raw paar ye pues of earning and saving foreign xchange have been for Ste aly 30 % of the aggregate import bill, re eating away .\ APTER-15 TRADE AND ECONOMIC DEVELOPMENT: 309 e 46. Rise in oil pric {The sharp rise in the prices of oil, particularly in 70's and also in the beginning of 1980's and 1990's is taking a big amount of the foreign exchange ~ earnings. Our import bill of petroleum group is increased to $ 14.8 billion in 2021-22. 47. Increases in import payment for fertilizer. There is a sharp increase in the import payments to.the outside world due to increase in prices of fertilizers, edible oil and petroleum. Our balance of payment shows a debit balance due to high payments. We ° | have imported the chemicals and fertilizers of $ 675 million. 18. Defense needs. We have to purchase modern weapons for our defense at a very high cost from different countries, which increases the burden on our BOP and it becomes adverse. Rupees 1523 billion are allocated for defence in the Federal Budget 2022-23. 49. Rapid import growth. Developed countries want to capture the economy of :developing countries, They are providing luxury goods ‘to developing countries on affordable prices. Developing countries are importing more due to new tastes and latest fashion trends. For example: Coca-Cola, Levi Jeans, Apple products, etc. 20. Global conflicts. Another import reason of deficit in BOP is various confits and war ~.among countries. Large economics have a great influence on the economies of small countries. Pakistan is facing unfavourable balance of payment due to Russia — Ukraine and China ~ Taiwan conflicts during 2022. Measures to correct the deficit balance are divided into three types: 4. Labour intensive industries. Labour intensive industries should be established, because labour is cheaper and more in Pakistan, these industries can be set up at lower cost. The products of these industries can be exported. Manufactured goods. Instead of exporting primary goods like raw cotton, Pakistan should’ export manufactured goods like textiles and garments, leather goods, food products and electrical goods. 3, Reduction in export duties. This step will make our export competitive in the international market. Foreigners will prefer to import from Pakistan Coane of low prices. Total subsidies for fiscal year 2022-23 have been estimated at Rs 699 billion. ; - Quality products. Many of our goods cannot be exported because of poor quality. on electric fans, cycles, electric motors, shoes, ball pens, crockery etc. cannot be sold abroad. Pakistan is needed to improve the quality of its products according to | standard. eat Serena Agencies should be made more active. Pakistan has already an this. There are Export Promotion Bureau, . Export Development Fund and ai Processing Zones, etc. All these are playing their effective role to increase exports to correct the BOP.CHAPTER-15 ey CONGNY. ————_—__—— 6. Immoral practices. Many Pakistanis have brought a bad name to our trado becau they export commodities of inferior quality than specified in the agreements So, all t should be restricted should be 7. Pricing of goods. It is necessary for increasing exports that goods produced under optimal conditions. Goods must be offered at competitive prices in international market. ®. Packing, High quality packing is essential for promoting exports, If packing is not attractive and durable, it cannot capture foreign market. roign investors can also 9. Joint venture. Establishing industries with joint venture of fo! arket push up the exports. The products of these industries can be sold in the foreign m EET Ted H 10: Import of only essential items. Only essential items should be imported, which are needed for our industrial production. Import of luxuries should be banned. People should be educated to come out from the complex of foreign goods. 44. Exchange control. Exchange control is also an important step to minimize the imports. Exchange control should be followed, so that there is no wastage of foreign exchange to import of un-necessary and luxuries, 12. Substitutes for imported items. Import substitutes should be manufactured in the country. iF home production of feriizer, paper, ste), edible ol and electrical goods ara increased, there will be less need for such imports. . GAITERS Tt 43. Decrease in consumption. Taxes should be imposed to reduce the consumption of many items. Rich people in our country are spending freely on“unnecessary and imported consumer items. There is wastage of foreign exchange reserves. 44. Control_of smuggling. Bara, smuggled and unorganized markets should be Bliminated. After an atomic explosion, the government is taking strict measures to eliminate markets ‘of smuggled goods. : 5. Population control, Many of our problems are arising due to fast increase in 15. Population control. Id be made to decrease growth rate of population, population. Sincere efforts shou People should be educated in this regard Conclusiot ‘Achievement of can achieve through installing import substitution and ex government should control the forex and check she import of luxuries. x Qoo } spa 6.1, Introduction. ; Classical economists did not believe in mobility of labor and capital between countries. Therefore, in classical era foreign investment failed to get due importance But } in 19" century the foreign investment was witnessed when British, Dutch and or came in the backward region of Asia, America and Portuguese investors and merchants Latin Africa surplus in the balance of payment is difficult but not impossible. It port promoting industries. TheeS ve ER-15 ‘TRADE AND ECONOMIC DEVELOPMENT 311 Fan ; direct investment is investment of foreign assets into domestic = ie He pment and organizations. FDI is durable and generally useful whether tetas or badly. In 2021, global FOI improve robustly and grew by 77% to US$ coon. Is compared to US$ 929 billion last year. The recovery remained highly en in infrastructure and green field projects, as due to stimulus package the former attract more FDI while in later it remained weak, globally. Definition: A foreign direct investment (FDI) is a purchase of an interest in a company by a : mpany or an investor located outside its eorre) A foreign direct investment (FDI) is an investment in the form of a controlling ownership in a business in one country by an entity based in another country". §.2. Current situation in Pakistan: Net FDI inflows rose 6.1 percent to US$ 1.25 billion till February 2022 as against US$ 1.18 billion last year. The FDI during Ju-Mar FY2022 declined by 2.0 percent to 4.28 billion as compared to US$ 1.31 billion same period last year. The inflows of FDI reached US$ 1.96 billion during Jul-Mar FY2022 compared to US$ 2.33 billion million same period last year, declined by 15.6 percent. The outflows of FDI during Jul-Mar FY2022 decreased by 33.2 percent and reached USS 682.4 million compared to US$ 1021.0 million same period last year. Similarly, in Pakistan, net FDI inflows rose 6.1 percent to US$ 1.25 billion till February 2022 as against US$ 1.18 billion last year. In March 2022, net outflow was recorded at 30.4 million on account of political instability and ullimate change of regime. The FDI is said to be an important factor for development of a nation: tT improve the BOP and TOT. When the foreign capital comes in a country the capital account of the BOP of host country improves. As a result, balance of payment and terms of trade are also improved. gResearch and development. When capital and entrepreneurs become mobile at ‘varid level the opportunities for research and development will be opened. 3. Integration into global economy. ‘A developing country, which invites the FDI, can gain a greater foothold in the world economy by getling access to a wider global market. “Technology advancement. The FDI can introduce world-level technology and jow and processes to developing countries. Foreign expert are important hnical processes in a host country. FDI brings in advances in technology and processes, economy of the developing country, which ve their processes and products in order to proves the quality of a products and technical know-h ee in upgrading the existing tect Ancreased competition. As the it increases the competition in the domestic has attracted the FDI. Other companies impro' stay competitive in the market. Overall, the FDI im| processes ina particular sector.° CHYOTER-15 PAKISTAN’ § ECONOMY. 312 Mmproved human resources. Employees of a host country in which there is the FDI get exposure to globally valued skills, The training and skills up-gradation can enhance the value of the human resources of the host country. 7. Access to larger market. The advantages of foreign direct investment to the investor includes access to a larger market in the host country, ability to use the potential of a cheap and skilled labour. It makes use of resources in the host country and growth goals eee and optimizing costs. sEconomic development, One of the advantages of foreign direct investment is that it helps in the economic development of the particular country where the investment is fe. This is especially applicable for developing economies. During the 1990s, being mad ss of financing for most foreign direct investment was one of the major external source: countries that were growing economically. It has also been noted that foreign direct investment has helped several countries when they faced economic poverty. geincrease in employment, For host countries, inward FD! has the potential for job creation and employment which is often followed by higher wages. Resource transfer, in terms of capital and technical knowledge is also a key motivator of inward FDI. 40. Stimulation of economic activity. The advantages of foreign direct investment are the flow of financial resources into the country. It will obviously stimulate economic activity in the country. Existing domestic producers have to puli up their stocks due to the beginning of high quality competition. The government will be taken seriously in the international summits because the number of stakeholders in the country has increased. place via multinational enterprises. Among 41. Social development. The FDI can take the more positive attributes are that MNEs can provide are knowledge, capital, {tributions to national productivity and technology, expertise, global ‘affiliations, cont exports, innovation, employment and social changes. 42, Growth at global Level. Advantage of foreign direct investment is the flow of funds in gur country. The FDI increases the resources and funds for corporate sector. It leads ment of ecoriomy and increase its global ranking. the foreign direct investments are that the majority ‘jetorious domestic companies, particularly those with onfy one of its kind compensation, Spend abroad. The advantage to be considered is thé direct investment that, makes campanies more victorious internally. Companies with the FDI generally tend to be most profitable as well as It is to have a more stable sales and earnings : overnment revenues. The revenues of the government also 414 Increase in the a in direct investment. The government receives a huge amount of increases due to foreig , direct and indirect tax on foreign investments. It increases the progress In the country and the revenues of the government. jan aie / 6.4, Disadvantas for : lowing-are the disadvantages of the FDI ‘éfiiraasa in inflation, The inward flow of financial resources increases the supply of inflation due to increase in money supply. money in the country. There is an increase in i to (develop! 73. More profit, The advantages oftu ER-15 TRADE AND ECONOMIC DEVELOPMENT 313 d Bad effects on local industry. Foreign Direct Investment in form of Multi-National Corporations creates bad effects on our local industry. People demand for the products of NNC’s that results ultimately backwardness of our local industries. Foreign control. The disadvantages of foreign direct investment are most visible in (Gases where the industry could have national secrets. The defense sector could be al Tisk if it allows the FDI. Foreign policies may be enforced that do not go down well with domestic employees. 4. Cost of transportation and communication. The disadvantages of foreign direct investments are cost of travel and communications abroad. It also does not very much Felate to local business tax laws, business atmosphere, in. particular and other government regulations. Another disadvantage could be the language and cullure Gifferences. The government is federal budget 2022-23 has reserved Rs 202 billion for Meapeon and communication. Brain drain. There is more demand for talented, experts, skilled and intellectual People due the FDI and MNCs. The FDI increases the opportunities for intelligent people from all over the world. All this leads to the out flow of the best brain, & Expensive and risky. Foreign direct investment is known to be both expensive and fisky as compared with either exporting or licensing, It is expensive because the. firm is literally starting from scratch to build a new enter course it has bought a going concern. Sk of collapse, If we totally depend on foreign direct investment, it may affect our tiered System adversely. Foreign direct investor's main aim to earn profit from our mar et, if any uncertainty in the market, if foreign direct investor withdraw their entire investment from our market then our financial system will collapse. ) MULTI CHOICE QUESTIONS AND ANSWERS) prise in a foreign country, unless of QUESTIONS 4 Trade organizations - of WTO & Pakistan. SAFTA:, According to the WB and IFC, in ease of doing 4 : 2 | business index 2022, rank off 9" Pakistan is. 3 _| The major export goods. Bucs Food 4 | Major exports of Pakistan. (echt Sports. Pakistan produces its oil ae 5 | requirements. tas om 4 le . Major market for exports of| Italy and Aighanistan | Germany °6 | pakistan. France —_| WSEMENSHE) “ond ui_| and Ul 7 Exports target of Pakistan for’ 2023. (S billion) 8 Imports target of Pakistan for _| 2023. ($ billion) [9 | Deficit in balance of paymentjcals_| Texille_| Chemie fo jor impor : UAE KSA | a Major maiket for imports of] TES nalary 11) pakistan. |__| Gapital Mot pakisian Tene Current unt account| | 42 Balance of payments has, account __| _accoum”__ efit None - [balance of payment ofa] surplus | unty always. oa ee | can is the system of Foreign i A FAeuea recoding all the economic} roreign direct a ee |. Trade 14] transaction of a country, with) "yet ere Specialization | ENuts the rest of the world during jp cone year, (—_ [6 arts of balance of payment. Exchange ‘rate determined All 46| with the demand and supply} Fixed Regulated | GEMBE |__| of currencies. 77/ A rise in GNP will increase. Imports Exports i 4g | Acountry has trade links with |" Free Closed "8 other countries. economy economy, {9| Invisible tems of balance off Income for [Educational |" Internet |" | payment. tourism services charges | za | Exchange rate . polley of] Controlled Fixed All ' Forex reserves of Pakistan till 21} March 2022 were ($ billion). 12.8 ie) 25.9 45.8 Base | Exports+ | Exporis= | Exports x 22 Net exports means. pees eae nee Which one is not major ; Raw 23) import of Pakistan? Machinery | Petroleum Material Which one -is not major ; i Fish and 24) export of Pakistan? pee) ue Fruits Which of the following is not , - : 25 on export of Pakistan? Rice Textile Fruits Source countries of 26 | remittances to Pakistan UAE&US | KSA&UK | Gulf & EU Each country produces those “ : ; a7| goods for which it's all Divison of Foreign | Trade not labour trade aid resources are most suitable. Import Self- : 28 | Strategy to expand exports, substitute dependent Commercial 29 | Export promotion committee. 1964 1968 30 | Export bonus scheme. 1955 1962 1969 31 | Export promotion bureau. 1955 1958 eae) 1967 32] Cotton export corporation. 1966 1970 1973] 1976 33 Demand for $ is greater than] Weakness of | Exchange Forex supply of $. A Dollar market market 34] = Export Price Index 59 Tea | | Transfer of Index | Balance of ~ Import Price Index trade| technology number trade Decrease in value of the 35] currency in terms of gold,] Appreciation | Depreciation None silver or foreign currency.peRo15 ‘TRADE AND ECONOMIC DEVELOPMENT 315 | Investment of foreign assets oan ‘Aid CPEC into domestic structures. Organization that currently TUN Justi Foreign | Justice 37 establishes rules of conduct| World Bank | an 4 nye Trade for firms engaging in trade: aren wit ; 5 fay 17, 3q| World rade "organization! 445 ygpq | Maton 4 ena (WTO) formed. 1993, ie 39 Siages eoonomy outside) aig China HEE dopa ‘al Provides a forum for 0} negotiations and for setting) IMF ) ie FOI |_| disputes, 5 41 Intemationar a ea came into existences U4] Janvary 1962 | RRRAREL | apc 1940. | June 1953 p+ eedquarter of IMF Califomia [New York | (NEEMINEI@N | Paris 43| World Bank came into formall > 7 | existen al) 40 May, 1942 V7 June, [7 July, TA polig " 1948 1952 44 | ubsidien ime ov'S_._ tariffs, | Monetary Taxation pol Subs ies. import quotas. policy Fiscal policy pole ship between 48] exchange = [fordotan “*® 2" demand} Constant Positive Index of expor price TOT = Deskot exper pr index oi»port price x 100 restrictiofs on the imports. Q5S. What is the BOT? -~ Q-67 What is the BOP? _~ Ans. Quantity of goods and sérvices a cot (during May 2022) terms of trade are 65.45 Q. 3. What is the devaluation? — Ans. A country’s record of intermational trading, goods, is called the balance of payment. Balance of payment is a system untry exports to pay index points. 'y for a unit of imports. At present Ans, Reduction in the exchange value of a country's monetary unit in terms of gold, siver, or foreign monetary units. It is the process of lowering of the exchange. rate of the own currency in terms of the currency of another country. Devaluation is adopted to remove the permanent deficits in the balance of payment. Devaluation is helpful of increase exports and to decrease imports, On the other hand, revaluation is the term used against devaluation Q. 4, What is protection policy?,~ Ans. Protection policy, in international trade, is adopted to minimize the imports in order to encourage the domestic industries. It is a policy of protecting domestic industries against foreign competition. Major tools of protection policy are tariffs, subsidies, import quotas and other Ans. The value of visible exports minus the value of visible imports is called the balance of trade. Balance of trade is the difference in value between the total exports of visible items and total imports.of visible items only, of a nation during a specific period of time, usually one year. borrowing and lending of visible and invisible atic record of a nation'sSo PARESTAW'S BEONOEY Price of Imports, 1he outflow ot capital and gold, ‘ MEN hy hinsiga ¢ ss, inehuinw ele! fece pts flom aurod, wncludy Ihe price of exports aad the mflaw of capital & gold QO 7. Whats foreign exchanga? Sut intelniatonal curmency it is thal type of currency which is used in and exports Sometimes, in different countnes, local currency which are used im and aeceptad'e in an Euro, Brivsh | ‘an in all ov _ mas fs Aneiin as foreign exch and sapanese Yen, Gol Siver ete Ba Wat is current account? , Fen Ah! 84 part of all goods & services and transfer payments on re GISTs Sates respectively in the short ime ra What is capitat account? IS. Capital acrount, why eee al whieh meludes beth long-term and short-term capital movements inside qh is exchange rate? The exchang are exchanged rele 1S the rale or ratio between two currencies at which both the currencies WHICH tho altrerent cemeng te Pree of one curreney in terms of another, 1 e., the proporticn in OME foreign cumenty sce nee Substiluled This is concemed with the process of exchange of Anouk Mo ee ae fer example, one US Dollar (3 1) is exchanged with Lett whatis the wrap 0 ns of ReMstan (Fs 2001) . Ans, The World ganuz: dod The vere rade Organzation was taking place during 1988-1994 t9 organize the world In the world. The mary inallens! organization ‘which was established ta organize the free trede solve vara Fade sapere af WTO ara fo pement te raleal rage 6 i de dispules, to cooperate with internali mic a hela the pearicountiee hee ‘ernalignal econcmic institutions and to help to Q. 12, What Is the EP? 5, , Ang. The major instiute Ex office in Karachi and four re: ‘increasing experts Q. 13, What is the EPZ? Ans. the government of Pakisian set-up a custom free Exports Processing Zenes to e@ncouraga exports and to import modem technology In 1980, First of all Karachi and Lahore were announced as EP2s Q. 14, What is the EURO (E)? * Ans. The fifteen members of European currency an 1 January 1999 Q. 18. Define Globalization? ~ Ans, Globalization is a free trade, among various nations or all the countries of the world, of the world So, currency oF gene 0 For sample, WS dollar, Fur ceipts and port Promotion Bureau was set-up in September 1963 with its head dlonal effices, The Export Promotion Bureau is playing a vital role in nion Countries have signed in 1962 ta use a single goods, services and capital Q. 16. What Is subsidy? —. Ans. Payment made by the government to producers so that they charge lower prices In the market, Slate assistance, in the form of money, for an Industry Q, 47. Defina seif-rellance policy? ; cane i endence policy, H refers to adjusting the escnor Ans. Self relance policy means sedenerdance potcy I refers fo aching he aD oa -economic needs according to the se [ : Iroludes ‘import substitulfon policy and minimum dependence on external resources. Domest resources are used in theis best way, Incase of self reliance policy is a surcharge?- , : ot pen ta an additional sum added {o the usual amount or cost Ans. Surcharge imposed by the government Gn persons or property. additional charges These are somaae TRADE AND_ ECONOMIC DEVELOPMENT. 4 ay p, What Is tariff? » ‘Ang © LAX OF duly of international type, imposed mainly on it | ysed (0 restiicl trade, especially imports. It increases the and make then More expensive for consumers. It is an | icy. Hl may be in the form of a fixed amount or in the form Q.20, What is the GATT? Ans, General Agreement on Tariff an to promote the global trade. Q. 21. What is foreign remittances? S Ans. Foreign remittances or worker remittances are the inflow of earning from abroad to Pakistan. It refers to that eaming which Pakistani people send to their families in Pakistan in the form of foreign currency. It is a transfer of money from a migrant worker to thelr families or other individuals in their home countries. Q. 22. Define excise duty? Ans. This is a duty imposed on home-produced goods and domestically provided services. Q. 23, What Is hard currency? Ans. In general, a currency that is scarce. The most likely, circumstances in which the demand fora currency exceeds the supply of it. Q. 24, What is soft currency? Ans. This is the opposite of hard currency, that is, it is a currenicy the supply of which exceeds the demand for it. ‘ ports is called by a tariff, Varilfs arg Price of imported goods and services mportant tool of trade or commercial of a percentage. id Trade, which was formed in 1948. Its basic objective was Qt CIEE ASS 01 Discuss in detail the major exports and Imports of Pal in. 292 Describe the Various Measures Adopted by the Government to reduce 297 02 | imports and to Increase Export. i / 03 | Describe the various steps to substitute the imporis with focal production 302 4 What is balance of trade? Write its types. Differentiate between Balance of 308 o { Payment. Trade and Balance of Pay What is balance of payment? Gwe The Causes of Aaverse Balance of | 95 8 yment, Also Suggest Measures to Improve It: Fat is foreign direct investment (FDI? Wile te advantages and | ay, os i tages. ; Se STE RCR of Foreign Trade in Economic Development of Pakistan? 07. | https://ahsankhaneco,blogspot.com/2022/1 1/international-trace-definition- Link 7 | https://ahsankhaneco.blogspolcomictec’ ea i a Fe the path to prosperity for developing world: Give rat 5 Link dvantages of trade. o : 08 eae eranee blogspot com/2022/{ttrade-not-aid-path-of-proaress nttps://ahsa a the government to boost exports ‘Summary of various measure adopted by the g vm og fad eer blogs, ot com/2022/1 Imeasures-to-boost-encburage- hutps: KI 2 of anda i cis and Effects on the Economy Define Devaluation? Explain its Obje ue ail 2022/1 1/devaluation-history- blogspot.cony Wy https://ahsankhaneco. blo _ intorduction. hum! - Objective: MCQs and Short Questions.