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  • 8/2/2019 Commerce Minister

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    Economy of Pakistan

    The economy of Pakistan is the 47th largest in the world in nominal terms and 27th largest in the world

    in terms of purchasing power parity (PPP). Pakistan has a semi-industrialized economy, which mainly

    encompasses textiles, chemicals, food, agriculture and other industries. Growth poles of Pakistan's

    economy are situated along the Indus River; diversified economies of Karachi and Punjab's urban centers

    coexist with lesser developed areas in other parts of the country. The economy has suffered in the past

    from decades of internal political disputes, a fast growing population, mixed levels of foreign investment,

    and a costly, ongoing confrontation with neighboring India. However, IMF-approved government policies,

    bolstered by foreign investment and renewed access to global markets, have generated solid

    macroeconomic recovery the last decade. Substantial macroeconomic reforms since 2000, most notably

    at privatizing the banking sector have helped the economy.

    GDP growth, spurred by gains in the industrial and service sectors, remained in the 68% range in 2004

    06 due to economic reforms in the year 2000 by the Musharraf government. In 2005, the World

    Bank named Pakistan the top reformer in its region and in the top 10 reformers globally. Islamabad hassteadily raised development spending in recent years, including a 52% real increase in the budget

    allocation for development in FY07, a necessary step toward reversing the broad underdevelopment of its

    social sector. The fiscal deficit the result of chronically low tax collection and increased spending,

    including reconstruction costs from the devastating Kashmir earthquake in 2005 was manageable.

    Inflation remains the biggest threat to the economy, jumping to more than 9% in 2005 before easing to

    7.9% in 2006. In 2008, following the surge in global petrol prices inflation in Pakistan reached as high as

    25.0%. The central bank is pursuing tighter monetary policy while trying to preserve growth. Foreign

    exchange reserves are bolstered by steady worker remittances, but a growing current account deficit

    driven by a widening trade gap as import growth outstrips export expansion could draw down reserves

    and dampen GDP growth in the medium term.

    Foreign trade, remittances, aid, and investment

    Investment

    Foreign direct investment (FDI) in Pakistan soared by 180.6 per cent year-on-year to US$2.22 billion and

    portfolio investment by 276 per cent to $407.4 million during the first nine months of fiscal year 2006,

    the State Bank of Pakistan (SBP) reported on April 24. During JulyMarch 200506, FDI year-on-year

    increased to $2.224 billion from only $792.6 million and portfolio investment to $407.4 million, whereas it

    was $108.1 million in the corresponding period last year, according to the latest statistics released by the

    State Bank. Pakistan has achieved FDI of almost $8.4 billion in the financial year 06/07, surpassing thegovernment target of $4 billion. Foreign investment had significantly declined by 2010, dropping by 54.6%

    due to Pakistan's political instability and weak law and order, according to the Bank of Pakistan.

    Pakistan is now the most investment-friendly nation in South Asia. Business regulations have been

    profoundly overhauled along liberal lines, especially since 1999. Most barriers to the flow of capital and

    international direct investment have been removed. Foreign investors do not face any restrictions on the

    inflow of capital, and investment of up to 100% of equity participation is allowed in most sectors. Unlimited

    http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)http://en.wikipedia.org/wiki/Purchasing_power_parityhttp://en.wikipedia.org/wiki/Pakistanhttp://en.wikipedia.org/wiki/Indus_Riverhttp://en.wikipedia.org/wiki/Economy_of_Punjab,_Pakistanhttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/IMFhttp://en.wikipedia.org/wiki/Foreign_investmenthttp://en.wikipedia.org/wiki/Musharrafhttp://en.wikipedia.org/wiki/Musharrafhttp://en.wikipedia.org/wiki/World_Bankhttp://en.wikipedia.org/wiki/World_Bankhttp://en.wikipedia.org/wiki/Islamabadhttp://en.wikipedia.org/wiki/2005_Kashmir_earthquakehttp://en.wikipedia.org/wiki/Foreign_exchange_reserveshttp://en.wikipedia.org/wiki/Foreign_exchange_reserveshttp://en.wikipedia.org/wiki/Foreign_direct_investmenthttp://en.wikipedia.org/wiki/State_Bank_of_Pakistanhttp://en.wikipedia.org/wiki/State_Bank_of_Pakistanhttp://en.wikipedia.org/wiki/Foreign_direct_investmenthttp://en.wikipedia.org/wiki/Foreign_exchange_reserveshttp://en.wikipedia.org/wiki/Foreign_exchange_reserveshttp://en.wikipedia.org/wiki/2005_Kashmir_earthquakehttp://en.wikipedia.org/wiki/Islamabadhttp://en.wikipedia.org/wiki/World_Bankhttp://en.wikipedia.org/wiki/World_Bankhttp://en.wikipedia.org/wiki/Musharrafhttp://en.wikipedia.org/wiki/Foreign_investmenthttp://en.wikipedia.org/wiki/IMFhttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Economy_of_Punjab,_Pakistanhttp://en.wikipedia.org/wiki/Indus_Riverhttp://en.wikipedia.org/wiki/Pakistanhttp://en.wikipedia.org/wiki/Purchasing_power_parityhttp://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)
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    remittance of profits, dividends, service fees or capital is now the rule. Business regulations are now

    among the most liberal in the region. This was confirmed by the World Bank's Ease of Doing Business

    Index report published in September 2009 ranking Pakistan (at 85th) well ahead of neighbors like China

    (at 89th) and India (at 133rd).

    Ministry of Commerce

    The department is entrusted with formulating and implementing the foreign trade policy and

    responsibilities relating to multilateral and bilateral commercial relations, state trading, export promotion

    measures, and development and regulation of certain export oriented industries and commodities.

    In order for the smooth functioning, the Department is divided into eight divisions:

    Administrative and General Division

    Finance Division

    Economic Division

    Trade Policy Division

    Foreign Trade Territorial Division

    State Trading & Infrastructure Division

    Supply Division

    Plantation Division

    The subjects under the administrative control of the Department include:

    International trade

    Foreign Trade

    State trading

    Management of Trade Services

    Special Economic Zones

    If Ill be The Commerce Minister:

    http://en.wikipedia.org/wiki/World_Bankhttp://en.wikipedia.org/wiki/Ease_of_Doing_Business_Indexhttp://en.wikipedia.org/wiki/Ease_of_Doing_Business_Indexhttp://en.wikipedia.org/wiki/Foreign_tradehttp://en.wikipedia.org/wiki/Exporthttp://en.wikipedia.org/wiki/Special_Economic_Zonehttp://en.wikipedia.org/wiki/Special_Economic_Zonehttp://en.wikipedia.org/wiki/Exporthttp://en.wikipedia.org/wiki/Foreign_tradehttp://en.wikipedia.org/wiki/Ease_of_Doing_Business_Indexhttp://en.wikipedia.org/wiki/Ease_of_Doing_Business_Indexhttp://en.wikipedia.org/wiki/World_Bank