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PAKISTAN'S VISION 2025
#19
FOCUSING ON INVESTMENT 
https://www.dawn.com/news/1447159/focusi...investment

AMONG all the themes that Prime Minister Imran Khan touched on during his visit to Malaysia, one deserves careful attention. Aside from his usual list of topics, from aggressively pursuing corruption cases to curbing money laundering, there was a new emphasis on facilitating investment in the country as a way to promote growth. The new emphasis on investment ought to be welcome in an economy that counts consumption as its main engine, and Pakistan’s investment rate has bottomed out in the past decade. Until this is changed, no amount of economic growth will help to lift the country out of its cycle of balance-of-payments crisis.

The only question that is left to answer now is how the new government intends to go about this mammoth task. Even though he spoke in Malaysia, Mr Khan did not focus solely on foreign investors. He pointed towards his new chief at the Board of Investment as somebody whom he is counting on to create an environment that is conducive for business for both local and foreign investors. That same chief, who is a former World Bank staffer, has constituted a committee to generate proposals on how to improve Pakistan’s standing in the Ease of Doing Business indicators, and is seeking input from private-sector parties across the board. This is a good place to start, but as time goes on, far more is going to be required. For investment to take off, the savings rate needs to be raised, documentation of the economy needs to be advanced, banks need to be encouraged to venture into areas like agriculture and small- and medium-enterprise lending, and proper coordination developed with provincial governments on matters ranging from tax reform to land acquisition. On top of this, a strategic overhaul of tax policy is needed, as is the introduction of a trade and industrial policy.

This is just a small part of the spectrum of priorities that need to be addressed in pursuit of this goal. Otherwise, the government can focus its energies on generating interest in a few big-ticket investment deals through structuring incentives in a way that attracts international investors. Something along these lines was tried during the prime minister’s visit to the so-called investment conference in Saudi Arabia last month. If Mr Khan’s stated intention in Malaysia is to be taken at face value, then he has identified for his government a sprawling and ever-growing mission. The target is the correct one, but there should be no illusions about how much momentum will be needed for the effort to be credible and sustainable. If this is truly going to be the last IMF programme that Pakistan signs onto, as the prime minister claims, then working on this broad agenda will be crucial.

INVESTING IN PAKISTAN

NOW that the financial emergency is over (with Saudi and Chinese financial support), and hopefully an IMF programme will be in place soon, the government must turn to adopting the trade, industry and investment policies required to accelerate growth, generate jobs, restrain imports and expand exports on a sustained basis.

As an initial step, the sectors and products which have the greatest potential for export growth should be identified and promoted. Textiles is Pakistan’s prime export sector. It has been stagnant for several years due to low investment in modern machinery, energy shortages, an artificially strong rupee and inadequate efforts to integrate into global supply and retail networks. Both the government and industry appear ready to redress these deficits.

Sectors and products with the greatest potential for export growth should be identified and promoted.

Agriculture also has bright prospects. Pakistan is food self-sufficient. Yet, its agricultural yields are comparatively low. A considerable agricultural surplus can be generated through the application of new technologies and techniques; improved seeds, planting and harvesting methods; efficient irrigation and fertiliser use; better storage facilities, access to markets, packaging and branding.

Pakistan’s manufacturing sector is minuscule — one fourth the size of the services sector. But, with its high propensity for consumption, Pakistan imports all kinds of manufactured goods. Low industrialisation is a consequence of the folly of past unthinking trade liberalisation. No one will manufacture an item in Pakistan if it can be more cheaply imported into the country. Pakistan can industrialise only if the government acts decisively to protect and promote its infant industries until they are in a position to compete with regional and global producers.

Since a number of Chinese manufacturing industries are becoming less competitive and/ or facing high US and European tariffs, there is a significant opportunity to work with Chinese partners to transfer such industries to Pakistan, and use it as an export platform. Such targeted transfers should be a special focus of CPEC’s Special Economic Zones.

Affordable and indigenous energy will be key to sustained growth. Renewable energy must be the clear preference. Despite high capital outlays, hydropower costs three cents per kilowatt hour. And solar power at four to five cents and wind at seven to eight cents are cheaper than imported fossil fuels and can serve off-grid areas. Approvals for the pending 2,500 MW solar and wind projects mentioned by the Sindh energy minister should be speedily issued. The installation of one or more solar panel production plants in Pakistan would be a profitable venture.


Pakistan may have delayed exploiting Thar coal far too long. Reportedly, electricity from the Thar coal power plants will cost eight cents per kilowatt hour. The environmental impact of coal power plants will be enormous. Future financing for coal-fired plants may not be available, unless new technologies can offer solutions. The Sindh government, for example, has been introduced to a technology which claims to capture waste coal flue gases and transform them into profitable products — ammonia, water or methanol — thus resolving both the environmental and economic problems encountered by coal.

Natural gas will need to be part of Pakistan’s energy mix, given its extensive gas distribution system and the dependence of households and industry on natural gas. Pipeline gas would be cheaper than LNG imports; but the Turkmenistan pipeline must await peace in Afghanistan, and the Iran pipeline will evoke US ‘secondary’ sanctions. Consequently, in the short term, there is no alternative to additional LNG terminals/ imports.


Gwadar’s full potential should be tapped. It was conceived not only as a transshipment port but also as a petrochemical centre. The planned Saudi refinery is a first step towards that vision. Crude and white oil pipelines from Gwadar upcountry and to China should be the next objectives.


An upgrade of Pakistan’s rail system is overdue. China is providing the heavy financing required. It may be wiser to ‘leapfrog’ to instal the most modern Chinese high-speed rail system rather than one which is already behind the times.


A considerable part of government revenues and most foreign ‘assistance’ will have to be deployed to realise the PTI’s social objectives:


— Education, where Pakistan must play ‘catch up’ through massive literacy and vocational training programmes.

— Healthcare, where the government’s idea of providing a health card is a good concept; but faces the problem of the virtual absence of the required health services. Health facilities need to be built up, including through public-private partnerships.

— Social infrastructure, ie clean drinking water, waste management, urban and rural transport and affordable housing, is essential to improve people’s quality of life and can be built also through public-private ventures.

— Policy support, where i1nstitutions like Pakistan Industrial Development Corporation and Pakistan Industrial Credit and Investment Corporation, need to be revived and professionally staffed to guide efficient implementation of various development programmes.


The finance minister’s concept of a sovereign wealth fund has not been fully elaborated. Adequate financing and expertise will have to be mobilised, domestically and internationally, to restructure and revive the myriad public corporations.  Pakistan’s private capital will be fully deployed if assured of policy clarity and consistency, official integrity, fair dispute resolution and reasonable returns. Close interaction between the government, the Pakistan Business Council and the various chambers is essential.

Pakistan’s capital market can be a growing source of investment finance through enhanced project financing, public listings and corporate bond issues.


Externally, China can be expected to maintain and enlarge its commitments under CPEC, especially if projects are efficiently executed. Chinese companies could be encouraged to take larger equity stakes in commercial projects.  Given the positive Saudi and UAE positions, considerable investment can be mobilised from the numerous sovereign wealth funds, pension funds, private equity funds, banks and family offices in the GCC. The government should encourage the creation of Pakistan-focused private equity funds to enlarge its financing sources and options.


Western companies may remain reluctant to enlarge their participation in the Pakistani economy unless the US reverses its negative posture and includes Pakistan in the Asian economic initiative it is launching to compete against China’s Belt and Road Initiative.

Although Pakistan offers attractive investment opportunities, financing these will require a well-considered and executed plan including a marketing campaign to ‘sell’ these opportunities sector by sector and project by project. The government must gird up for this vital task.

NEXT SC CAMPAIGN TO TACKLE POPULATION CONTROL SAYS CJP 


Chief Justice of Pakistan (CJP) Mian Saqib Nisar on Saturday revealed that the next campaign the Supreme Court would support would be centred around population control. Speaking to Geo News following a fundraising event in Birmingham for the construction of dams here, Justice Nisar said that he is planning to spearhead a drive spreading awareness about population control.
"A task force for family planning under Health Secretary Captain (retd) Zahid Saeed was already created and has come up with a report on the matter," he said.  "There will be a conference regarding this in the Supreme Court... on December 12 or 13, and the prime minister and I will also be part of the conference."
"Your [country's] resources are shrinking and that will continue to eventually create disparity and saturation [of resources]," the CJP said. "This is one of the most fundamental issues of the country and it needs to be combated."  According to the 2017 census, which was held after a gap of 19 years, the country’s population has been counted at 207,774,520 living in 32,205,111 households. Top government officials have decided to reduce the population growth rate of 2.4 per cent per annum to 1.5pc.

The Centre and the provinces last Monday decided to form task forces  within their
jurisdictions to control rapid population growth.  The task forces will consider recommendations made by a task force constituted earlier on SC orders, and will submit a comprehensive action plan to the Council of Common Interests, taking into account the future implementation strategy of the action plan, the financial aspects and other issues relating to garnering support of all segments of society for the success of a comprehensive population control programme.


Justice Nisar, while speaking about the fundraiser, said that the response for his call to funds had been overwhelming.


"When an eight-year-old child and and 84-year-old woman both have contributed [to the fund] then who else is left? The whole country has come together to make this fundraising a successful movement."

WHERE IS ACADEMIA? 

WHEN was the last time you heard someone or the other saying that education is our only hope. In the last twenty four hours would be a safe bet, if not sooner. If we really believe that education is so central for Pakistan to raise its game then by definition we also believe that we have at the very least a handful of teachers who can help us wrestle the demons of the past and tackle what challenges lie in wait.


A prize for anyone who can name an academic who fits the bill of ‘public intellectual’ other than Dr Pervez Hoodbhoy, Dr Faisal Bari, and that bright spark almost out of public sight now, Dr Mohammad Waseem. Just where in the name of goodness is academia? All over the world it is academics who lead the discourse on every subject of import. They set up and lead think tanks. It is university professors who advise governments and help formulate policies. TV talk show hosts and news anchors invite academics as experts and analysts.



This abdication by the epistemic community has given rise to the most unfortunate situation where TV anchors have assumed the mantle of the public intellectual, and to add insult to injury, they invite fellow anchors as commentators and experts who trot out a moral equivalence for every outrage, see a conspiracy behind every development, and do not miss any opportunity to claim ‘I told you so’ in column this and that or on channel such and such.



TV anchors have assumed the mantle of public intellectuals.

It has been more than a decade and a half since the Higher Education Commission launched its faculty development initiatives including scholarships for PhD programmes in the leading universities of the world. Such efforts by the HEC for quality enhancement of centres of higher learning in the country can only be commended. However, by now we should have had at least a couple of cohorts of these PhDs making waves not just in the country but internationally as well.



Are we to understand that despite the mushrooming of public, semi-public and private universities in the country, we do not have, let’s say, 20 academics who can better inform the public discourse on tolerance, plurality of ideologies and beliefs, political economy, public office and conflict of interest, science, technological development, literature and art? Is it too much to ask of a 200 million-plus resource pool? It comes to one for every 10m Pakistanis.

So which Pakistani academic journals rank among the region’s best? Who has of late made waves in research publications internationally? Alright, we will make the rules of the game less stringent. These academics, researchers, scientists, public intellectuals need not be living in Pakistan. So how many times have you seen Dr Nergis Mavalvala, a Pakistani-American astrophysicist known for her role in the observation of gravitational waves, being invited to weigh in on any matter, scientific or otherwise? She is the Curtis and Kathleen Marble Professor of astrophysics at the Massachusetts Institute of Technology where she is also the associate head of the Department of Physics. Or is it that unless it is nuclear physics and something to do with the ‘bomb’ we are not interested? Or better still, astrologists who predict by-election results on TV channels and which month will be bhari (inauspicious) for politicians?



How often is Professor Ayesha Jalal invited to public forums in Pakistan? She is a Pakistani-American historian who serves as the Mary Richardson Professor of History at Tufts University. She has taught at Harvard and is the author of books like The Sole Spokesman: Jinnah, the Muslim League, and the Demand for Pakistan; and The Struggle for Pakistan: A Muslim Homeland and Global Politics, just to name the first and the latest. Maybe the ratings and popularity constraints demand the staged shouting matches that are held between sarkari intellectuals who are frequently seen heaping invective on each other both on and off air.



The HEC is right in insisting on research and a publication-oriented path to excellence for faculty, but those provided scholarships abroad either do not complete their PhDs or do not return to teaching jobs in Pakistan. Those who conduct their research programmes in Pakistan are hard-pressed to find qualified peer reviewers and supervisors with the right mix of discipline and mentorship.



Plagiarism cases keep appearing with disturbing frequency. The HEC itself is not immune to such scandals. Still there must be academics out there who can hold their own at least against the current lot of self-styled public intellectuals we are made to suffer day in and day out. We need an entire crop of accomplished academics whose understanding and knowledge of their subjects of specialisation is acknowledged and validated by their peers at home and abroad. Sold-out speaking circuit venues will be a sure sign of a healthy and informed discourse going on.
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RE: PAKISTAN'S VISION 2025 - by globalvision2000administrator - 11-25-2018, 01:05 PM

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