TERRORISM: REASONS FOR

ECONOMIC DECLINE IN PAKISTAN

TERRORISM

 Destruction
 Suicide Attack
 Killing of Innocent
EFFECTS
 Disturbs the Inhabitants
 Damage Infrastructure
 Cause a Decline in economic well-being
Economical Affects

 Lower Foreign Direct Investment

 Capital Formation
 Investment
 Increases Risk Perception
IMPACT OF TERRORISM ON FOREIGN
DIRECT INVESTMENT
IMPACT OF TERRORISM ON
TOURISM IN PAKISTAN
IMPORTANT ROLE OF TOURISM IN
ECONOMY

 Sources of foreign exchange

 Employment opportunities
 Culture exchange
 Sources of public as well as private
income
 TOURISM'S CONTRIBUTION

TO GDP PAKISTAN To employment

 In 2013 the Travel &
 The direct contribution of Tourism sector supported
Travel & Tourism to GDP in 3563 thousand jobs which
2013 was 3.1% is 6.2% of total
employment.
Comparison with different
countries
Why Tourism Decline In
Pakistan?
 Terrorism

 Tourism decline in
Pakistan mainly
caused by terrorism.
 After 9/11 incident
 Afghan war
 Terrorist activities
MARRIOTT HOTEL ATTACK

 Five Star Hotel

 In September 21,2008
 Killed foreigners
ATTACK ON SRILANKAN CRICKET TEAM

 3rd March,2009
 8 police men killed
 6 player injured
 Pakistan lost World
cup hosting
 Many home series
QUAID-E-AZAM RESIDENCY ATTACK

 In Ziaraat 15 june,2013 attack on residency.

The residency totally destroyed.
 TOURIST KILLED IN NANGA PARBAT
 23 june,2013
 9 foreign tourist killed five Ukrainians, three
Chinese and a Russian.
 Kidnapping of foreign tourist.
PAKISTAN IS DANGEROUS COUNTRY

 According to report Pakistan become the 7th

most dangerous country for travel due to
terrorism and target killing and every country
allow their ambassador to move very limited
area.
Impacts Of Terrorism on agriculture of Pakistan

 In the past few years, along with many other factors terrorism has
contributed a lot to the decline in the total production capacity. Every
province of Pakistan contributes towards the total production of country.
 Agriculture is the main source of revenue in most of the terrorism-
affected areas, including FATA and KPK which are worst affected by both
terrorism and WOT.
 People in these areas rely predominantly on agriculture as their main
economic activity. The districts of Swat, Buner, Shangla and Lower Dir,
along with the Malakand Agency, in the troubled region, are famous for
their specialized agricultural produces all over the country.
 The area of Malakand division has earlier made substantial contribution to
national production of various crops: peach (60%), pear (34%), tomato (18%),
apple (15%), plum (14%), tobacco (11%), maize (8%), onion (8%), all
vegetables (5%), apricot (5%), wheat (1%), and rice (1%).

 Swat leads the other four districts in the production of fruits by a large margin.
A survey by the National Agricultural Research Centre (NARC) shows that
nearly 48% of Pakistan’s total fruit is produced by KPK, with Swat district
being a major contributor
 Agriculture is the main source of livelihood for most households,
accounting for 80% of the total population. It specializes in many
commodities like peaches and contributes about 60% to the national
production. Swat also produces 13% of total national production of
tomato. In the overall provincial production of vegetables in the KPK, one-
forth comes from Swat. These commodities arrive in markets when
supplies from other corners of the country are short.

 Normally, 500 to 600 trucks transport fruit from Swat to the rest of the
country during the harvest season on a daily basis. But, due to the
insurgency, the Swat valley has been subjected to continuous attacks
since 2007 which often resulted in road blocks thus halting the regular
trade.
 According to the government of Pakistan estimates, the loss to agriculture
alone amounts to Rs. 35 billion. The local media, citing Swat-based
agricultural officials has reported that 55 to 70 per cent of the total fruit
produce has gone waste.

 That has been due to various factors, including hostilities, artillery shelling,
blowing of bridges in bomb blasts, blockade of roads, attacks, and curfews.
The breakdown in law and order has damaged the district’s fruit-based
economy and rendered billions of rupees losses to the landowners,
laborers, dealers and farmers who earn t heir livelihood from these
Orchards.
 Also, the Economic Survey of Pakistan report shows that the share of
agriculture in the gross domestic product (GDP) has been constantly falling.

 It accounted for 25.9 percent of GDP in 1999-2000; however, gradually its

share shrank to 21.3 per cent in 2007- 2008 but improved slightly to 21.8
per cent in 2008-2009.

 Terrorism has not only decreased the productive capacity of agricultural

activity in these regions but also in the entire country.
Year Agriculture Major Minor Livestock Fishery Forestry
Growth (%) Crops Crops

2004-05 6.5 17.7 1.5 2.3 0.6 -32.4

2005-06 6.3 -3.9 0.4 15.8 20.8 -1.1

2006-07 4.1 7.7 -1.0 2.8 15.4 -5.1

2007-08 1.0 -6.4 10.9 4.2 9.2 -13.0

2008-09 4.0 7.8 -1.2 3.1 2.3 -3.0

2009-10 0.6 -2.4 -7.8 4.3 1.4 2.2

2010-11 1.2 -4.0 4.8 3.7 1.9 -0.4

 Table shows that, in Pakistan, agriculture growth was 6.5 percent in 2004-
05 which decreased to 6.3 percent in 2005-06 and further decreased to
4.1 percent in 2006-07. In 2007-08, it sharply declined to 1.0 percent and
it rose to 4.0 percent in 2008-09. In 2009-10, it showed 0.6 percent
growth and increased to 1.2 percent in 2010-2011.

 However, the situation seems to improve post 2012 due to improvement

in law and order situation in the war torn areas.
IMPACT OF TERRORISM ON
SECURITY BUDGET IN PAKISTAN
 The loss to Pakistan’s economy due
to war on terror has been estimated
at $118.32 billion billion during past
15 years

 The conflict and instability in

Afghanistan in the aftermath of 9/11
terrorist attacks and their regional
implications had immense negative
consequences for Pakistan.

Source: Economic Survey 2015/2016

 In order to address the menace of terrorism and violent
extremism effectively, Pakistan has crafted a 20-point
National Action Plan which outlines various kinetic and
preventive measures.

 The comprehensive, all-out law enforcement action Zarb-e-

Azb launched against all terrorist groups without any
discrimination has been remarkably successful. ‘Zarb-e-Azb’
has started paying dividend in terms of overall improved
security situation in the country. This has created an enabling
environment for business and investment in Pakistan.

Source: Economic Survey 2015/2016

 With Pakistan expected to
face a loss of around $5.55
billion during the outgoing
financial year, the Ministry
of Finance has estimated
that the cumulative loss to
the national economy has
reached $118.32bn since
9/11 due to the impact of
war in Afghanistan.
 During the last 14 years, the direct and indirect cost
incurred by Pakistan due to incidents of terrorism
amounted to $118.31bn equivalent to Rs9.86 trillion
source: Published in Dawn, June 3rd, 2016
 Pakistan’s defense budget is the lowest in the region

 It spends roughly the same allocation as a percentage

of GDP (2.30%), but we all know that Pakistan’s GDP is
much smaller than that of India; about one eighth

Source: The Nation

 Pakistan’s GDP growth still hovers around the 4%
mark – and given that the existing Indian economy is
already nearly 8 times the size of Pakistan’s
economy, essentially in economic terms India
virtually adds one whole of

 Pakistan’s total economic turnover to its economy

every year
Source: The Nation