INVESTMENT

THINK TANK…

Would you risk your money hoping for a gain

in future?

To put it in a nutshell,
WOULD you WANT TO
invest?
THE CONCEPT OF INVESTMENT

 Investment is the process of risking one’s

savings in the hope of a monetary gain.
 Using a good or its money equivalent to create
another good or fetch the returns of the
invested amount in terms on interest or profit
share.
TYPES OF INVESTMENT
 Aggressive Investment: Aggressive investors
invest in stock markets and business ventures and
involves a great amount of risk
 Conservative Investment: Conservative
investors invest in cash. They put their money in
investment accounts like savings, mutual funds
and certificates of deposit.
PRESENTATION FLOWCHART
INVESTMENT

PRIVATE INVESTMENT

PUBLIC INVESTMENT
F OR EIG N D IRE CT INV ES T ME NT

PORTFOLIO INVESTMENT
ECONOMIC DEFINATION OF INVESTMENT

In context of economics, investment is the per

unit time production of goods, which are not
consumed and are rather used for production
in future
SOURCE: WORLD BANK; INVESTOPEDIA
CATEGORIES OF INVESTMENTS

 Public Investment
 Private Investment
PRIVATE INVESTMENT
 Large organizations and corporations were the
first to explore and make investments in the
foreign economy.
 Time passed and smaller businesses started to
transfer enormous sums of money abroad,
 investors even tried to invest money into third
world countries in spite of rather low profits and
high fiscal risks.
PRESENTATION FLOWCHART
INVESTMENT

PRIVATE INVESTMENT

PUBLIC INVESTMENT
F OR EIG N D IRE CT INV ES T ME NT

PORTFOLIO INVESTMENT
TYPES OF PRIVATE INVESTMENT
 DIRECT PRIVATE INVESTMENT
Direct investments is when before making an
investment into a foreign country, a businessman visits
the country to assess potential risks and profits and
takes a decision
 PORTFOLIO INVESTMENT
The portfolio type of investment is when an investor
buys shares of a business. And it is the financial
situation on the stock market that determines whether
a business person will get profits or not.
DIRECT AND PORTFOLIO INVESTMENT ($
MILLION)

2009-2010(July-Oct) 2010-2011(July-Oct)

Country  Portfolio Portfolio

Direct  Total Direct  Total
Private Public Private Public

USA 133.9 192.0   325.9 75.5 120.7   196.2

UK 76.2 62.3   138.5 87.1 10.6   97.7

Netherlands 57.8 0.1   57.9 8.9 2.4   11.3

UAE 55.1 0.1   55.2 83.0 2.1   85.1

Switzerland 26.8 10.0   36.8 5.6 3.5   9.1

Singapore 33.2 1.3   34.5 16.1 -0.1   16.0

Caymen Island 45.1 -   45.1 16.3 -   16.3

Germany 8.1 0.05   8.2 1.4 -1.6   -0.2

Other  160.2 22.6   182.8 173.8 -36.3   137.5

Debt Securities     -9.9       -38.7  

GDRs                

Total 596.4 288.5 -9.9 875.0 467.7 101.3 -38.7 530.3

Source : State Bank of Pakistan

21.6% decrease in FDI Including Privatisation Proceeds as compared
to July-October 2010
FOREIGN DIRECT INVESTMENT
 DEFINITION OF FDI
Foreign direct investment are the net inflows of
investment to acquire a lasting management interest (10
percent or more of voting stock) in an enterprise
operating in an economy other than that of the investor.
It is the sum of equity capital, reinvestment of earnings,
other long-term capital, and short-term capital as shown
in the balance of payments.
SOURCE: Source :International Monetary Fund, International Financial
Statistics and Balance of Payments databases, and World Bank, Global
Development Finance
FOREIGN INVESTMENT INFLOWS IN PAKISTAN ($ MILLION)

Greenfield Privatisation Private

Year  Investment Proceeds Total FDI  Portfolio

    Investment

2001-02  357.0 128.0 485.0 -10.0

2002-03  622.0 176.0 798.0 22.0

2003-04  750.0 199.0 949.0 -28.0

2004-05  1,161.0 363.0 1,524.0 153.0

2005-06  1,981.0 1,540.0 3,521.0 351.0

2006-07  4,873.2 266.0 5,139.6 1,820.0

2007-08 5,019.6 133.2 5,152.8 19.3

2008-09 3,719.9 - 3,179.9 -510.3

2009-10 2,150.8 - 2,150.8 587.9

2010-11 (July-Oct.,) 467.7 - 467.7 -

Total  21,102.2 2,805.2 23,367.8 2,404.9

Source : State Bank of

Pakistan
TYPES OF
FOREIGN DIRECT INVESTMENTS

FDIs can be broadly classified into two types: This

classification is based on the types of restrictions imposed,
and the various prerequisites required for these investments

 OUTWARD FDI:
An outward-bound FDI is backed by the government against all types
of associated risks, i.e. 'direct investments abroad.‘

 INWARD FDI:
Different economic factors encourage inward FDIs. These include
interest loans, tax breaks, grants, subsidies, and the removal of
restrictions and limitations
COUNTRY WISE FDI INFLOWS
($ MILLION)

2010-11
Country 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10
(Jul-Oct)
USA 92.7 326.4 211.5 238.4 325.9 516.7 913.1 1,309.3 869.9 468.3 75.5
UK 90.5 30.3 219.4 64.6 181.5 244.0 860.1 460.2 263.4 294.6 87.1
U.A.E 5.2 21.5 119.7 134.6 367.5 1,424.5 661.5 589.2 178.1 242.7 83.0
Japan 9.1 6.4 14.1 15.1 45.2 57.0 64.4 131.2 74.3 26.8 0.3
Hong Kong 3.6 2.8 5.6 6.3 32.3 24.0 32.6 339.8 156.1 9.9 66.1
Switzerland 3.6 7.4 3.1 205.3 137.5 170.6 174.7 169.3 227.3 170.6 5.6
Saudi Arabia 56.6 1.3 43.5 7.2 18.4 277.8 103.5 46.2 (92.3) (133.8) 4.8
Germany 15.5 11.2 3.7 7.0 13.1 28.6 78.9 69.6 76.9 53.0 1.4
Korea(South) 3.7 0.4 0.2 1.0 1.4 1.6 1.5 1.2 2.3 2.3 0.9
Norway 0.1 0.3 146.6 31.4 252.6 25.1 274.9 101.1 0.4 0.4
China 41.9 0.3 3.0 14.3 0.4 1.7 712.0 13.7 (101.4) (3.6) 3.7
Others 76.6 173.9 108.6 369.3 521.9 1,512.2 2,005.2 1,964.2 1,019.6 138.9
Total 322.4 484.7 798.0 949.0 1523.9 3521.0 5139.6 5409.8 3719.9 2150.8 467.7
Privatisation
- 127.4 176.0 198.8 363.0 1540.3 266.4 133.2 0.0 0.0 0.0
Proceeds

FDI Excluding
322.4 357.3 622.0 750.2 1,160.9 1,980.7 4,873.2 5,276.6 3,719.9 2,150.8 467.7
Pvt. Proceeds

21.6% decrease in FDI Including Privatisation

Proceeds as compared to July-October 2010.
Source: BOI and the State Bank of Pakistan
TYPES OF FOREIGN DIRECT INVESTMENTS
 VERTICAL FOREIGN DIRECT INVESTMENT
Takes place when a multinational corporation owns
some shares of a foreign enterprise, which supplies
input for it or uses the output produced by the MNC.
 HORIZONTAL FOREIGN DIRECT
INVESTMENTS:
Happens when a multinational company carries out a
similar business operation in different nations.
SECTOR WISE FDI INFLOWS ($ MILLION)

Sector 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09

Oil & Gas  80.7 268.2 186.8 202.4 193.8 312.7 545.1 634.8 775.0

Financial Business (34.9) 3.6 207.4 242.1 269.4 329.2 930.3 1,864.9 707.4

Textiles 4.6 18.5 26.1 35.4 39.3 47.0 59.4 30.1 36.9

Trade 13.2 34.2 39.1 35.6 52.1 118.0 172.1 175.9 166.6

Construction 12.5 12.8 17.6 32.0 42.7 89.5 157.1 89.0 93.4

Power 39.9 36.4 32.8 (14.2) 73.4 320.6 193.4 70.3 130.6

Chemical 20.3 10.6 86.1 15.3 51.0 62.9 46.1 79.3 74.3

Transport 45.2 21.4 87.4 8.8 10.6 18.4 30.2 74.2 93.2

Communication
NA 12.8 24.3 221.9 517.6 1,937.7 1,898.7 1,626.8 879.1
(IT&Telecom)

Others 140.9 66.2 90.4 170.1 274.0 285.0 1,107.2 764.5 763.4

Total 322.4 484.7 798.0 949.4 1,523.9 3,521.0 5,139.6 5,409.8 3,719.9

Privatisation
- 127.4 176.0 198.8 363.0 1,540.3 266.4 133.2 0.0
Proceeds

FDI Excluding
322.4 357.3 622.0 750.6 1160.9 1980.7 4873.2 5,276.6 3,719.9
Pvt. Proceeds

Source : State Bank of Pakistan & BOI Pakistan

 WORLD BANK AND
THE EASE OF DOING BUSINESS INDEX
WORLD BANK
 The World Bank recognized Pakistan the 85th
most business friendly country in the world in its
annual 'Ease of Doing Business' report
 Recent reforms improved our position and helped
sustain our position as the first most business
friendly location in our region.
EASE OF DOING BUSINESS INDEX
 The Ease of Doing Business Index is an index
created by the World Bank. Higher rankings
indicate better, usually simpler, regulations for
businesses and stronger protections of property
rights.
 The Ease of Doing Business index is meant to
measure regulations directly affecting businesses.
A nation's ranking on the index is based on the
average of 10 subindices:
 10 SUB INDICES OF THE EASE OF DOING BUSINESS INDEX

 1. Starting a business - Procedures, time, cost and minimum

capital to open a new business
 2. Dealing with licenses - Procedures, time and cost of business
inspections and licensing (construction industry)
 3. Hiring and firing workers - Difficulty of hiring index,
rigidity of hours of index, difficulty of firing index, hiring cost
and firing cost
 4. Registering property - Procedures, time and cost to register
commercial real estate
 5. Getting credit - Strength of legal rights index, depth of credit
information index
10 SUB INDICES OF THE EASE OF DOING BUSINESS INDEX

 6. Protecting investors - Indices on the extent of disclosure,

extent of director liability and ease of shareholder suits
 7. Paying taxes - Number of taxes paid, hours per year
spent preparing tax returns and total tax payable as share of
gross profit
 8. Trading across borders - Number of documents, number
of signatures and time necessary to export and import
 9. Enforcing contracts - Procedures, time and cost to
enforce a debt contract
 10. Closing a business - Time and cost to close down a
business, and recovery rate
SNAPSHOTS OF THE EODB INDEX

SOURCE: World Bank ; Ease of Doing business

Index
SNAPSHOTS OF THE EODB INDEX

SOURCE: World Bank ; Ease of Doing

business Index
SNAPSHOTS OF THE EODB INDEX

SOURCE: World Bank ; Ease of Doing

business Index
PRESENTATION FLOWCHART
INVESTMENT

PRIVATE INVESTMENT

PUBLIC INVESTMENT
F OR EIG N D IRE CT INV ES T ME NT

PORTFOLIO INVESTMENT
HISTORY OF INVESTMENT
1947-2010
 INVESTMENT BENCHMARKS
 Political stability;
 Law and order;
 Economic strength;
 Government economic policies;
 Government bureaucracy;
 Local business environment;
 Infrastructure;
 Quality of labor force;
 A welcoming attitude.( the way the guests are received and
entertained)
INFLOW OF FDI DURING THE DEMOCRATIC
GOVERNMENTS
HISTORY OF INVESTMENT

THE AGE OF INNOCENCE

1947-1957
OVERVIEW
 Pakistan was an agricultural economy upon its
independence in 1947
 It lacked the industrial capacity to process
locally produced agricultural raw material, as
well as the funds to create new capital.
 A need on the part of the government to obtain
funds from abroad to invest it
in the local industries and improve the
countries manufacturing capacity.
OVERVIEW
 The private sector was the main vehicle for
industrial investment during the 1950s and the
1960s
 The involvement of the public sector was restricted
to very few industries
 Private capital not forthcoming for the development
of any particular industry of
national importance
 Foreign investment was not allowed in the field of
banking, insurance, and commerce.
DEMOCRATIC ERAS
PREVIEW
 In 1960s the economy was dominated by the
private sector.
 Areas that fell under the private sector included:
banking, insurance, basic industries, and
international trade of major commodities.
 Services sector was reserved for local investors.
 No foreign investment allowed in banking,
insurance and commerce.
BENCHMARKS OF INVESTMENT
 Political instability.
 Law and order.
 Economic strength.
 Government economic policies.
 Government bureaucracy.
 Local business environment.
 infrastructure.
 Labor force
 Quality of life.
 Welcoming attitude.
1970S.
 Economic reforms were introduced in 1972 by
the government which stated its control over the
following:
- 10 major industries of Pakistan
- 7 commercial banks
- development financial institutions
- insurance companies
 THIS WAS FIRST
ROUND OF
NATIONALIZATION
 1975 marks the second round of
nationalization in which small sized agrobased
units were nationalized.
 Sudden shift towards nationalization of private
sector industrial units shattered PRIVATE
INVESTORS CONFIDENCE.
 Acceleration in direct investment by the public
sector took place.

Manufacture of Production of Production of

steel garments bread
REASONS FOR FDIS DETERRENT INFLOW
 Significant public ownership.
 Strict industrial licensing.
 Price controls by the government.
 Inefficient financial sector with mostly public
ownership, directed credits and segmented
markets.
 A non cooperative and distorting trade regime
with import licensing, bans and high tariffs.
STEPS TAKEN BY THE GOVERNMENT
 Governments approach towards the public and
private sector changed in 1978 after the negative
performance of the industrial sector following the
1972 nationalization.
 Role of public sector was restricted.
 It was decided that government would continue
to pursue pattern of mix economy.
 To encourage foreign direct investment Export
Processing Zone EPZ was set up in karachi.
 Foreign investors and overseas Pakistanis were
encouraged to invest in industrial projects.
 EPZ offered the following incentives:
- duty free imports.
-export of goods
- tax exemptions.
1990S

A ROLLERCOASTER RIDE FOR FDI

THE GOVERNMENT S
 Benazir Bhutto 1988-1990
 Nawaz Shariff 1990-1993
 Benazir Bhutto 1993-1996
 Nawaz Shariff 1997-1999
POLITICAL UNCERTAINTY AND FDI
 During 1990s:
 Four governments and parliaments were dismissed.
 Three general elections were held at the close of the
decade.
 The civilian set up was replaced with a military
regime.
 When civilian governments were in power
speculations of its sack were ripe.
EFFECTS OF INSTABILITY
Political instability

No continuity in Law and order

policies disrupted

High risk of
investment
BENCHMARKS OF INVESTMENT
 Political instability.
 Law and order.
 Economic strength.
 Government economic policies.
 Government bureaucracy.
 Local business environment.
 infrastructure.
 Labor force.
 Quality of life.
 Welcoming attitude.
 OVERVIEW
 Originally each foreign investment was to be authorized
individually but in 1991 this was eliminated.
 The requirement for approval of government for FDI

was removed with the exception of:

- arms and ammunition.
- security printing.
- currency
- high explosives
- radioactive substances
- alcoholic beverages
 These industries were also closed for any
private investment.
 All investors were asked to obtain an NOC (No
objection certificate).
 In past the government didn’t allow investors to
negotiate the terms and conditions of payment
of royalty and technical fees but now they are.
 The government also permitted multinationals
to transfer their requisite technology.
 Liberalization of foreign exchange scheme.
 Residential and non residential pakistanis and
foreigners are allowed to BRING IN, POSSES
or TAKE OUT foreign currency.
 Ceiling imposed on contracting foreign loans
has been abolished.
 Permission of FG and SBP will not be required
regarding interest rate or payments foreign
loans not guaranteed by the govt.
 Credit facilities, fiscal incentives and visa policies by
the govt serve as investment incentives.
 3 year tax holiday to companies established after dec
1990 and june 1995.
 Industries established in rural areas, industrial zones and
less developed areas enjoy 5-8 yrs tax holiday, along
with special custom duty and sales tax concessions.
 Tariffs reduced from 225% (86) to 45% (96)
 Prohibited list of imports was reduced.
 And many other policies to attract FDI were imposed.
ARMY RULE GOVT.
 Monday, November 15, 2010

“Musharraf era was best in 63-year history of Pakistan: Dr Salman”

http://www.dailytimes.com.pk
Pakistan was among the first few countries in the region to open up the market
in early nineties

Foreign investment came in large volume, both as FDI and as portfolio funds.

The FDI inflow to Pakistan in 1992-93 was US$ 307 million and exceeded
US$ one billion in 1995-96.

Lets Look at the reasons …

http://www.pakistaneconomist.com/database2/cover/c98-2.asp
 FEATURES
AFFECTING FDI

The Government was powerful enough to solve the problems

of the people and to sustain.

establishing the groundwork for future stability through altering the economic,
legal, and constitutional institutions.
There were street crimes , suicide bombings and some unrest in the
provinces .

Good Government policies and benefits for foreign investors coping up for
them.

restoring confidence in the private sector

The leadership had actively pursued an investor-friendly policy and enacted
incentives such as tax breaks and even subsidies on leased land in specific sectors.

Policies Of Army Rule Affecting Investment :-

Tax concessions were offered for investment in less-developed areas

The deregulation of the banking sector.

including sharply cutting loan interest rates,

putting in place a regime that allowed banks to engage more liberally in giving
consumer finance loans

http://www.defence.pk,
http://www.revolutionarydemocracy.org/rdv8n1/pakistan.ht
m
and lifting restrictions on the number of branches that foreign banks could open in
Pakistan.

As a result of these policies, the banking sector boomed and many foreign banks from
the Middle East and other parts of the world came flocking to Pakistan
liberal and encouraging policies of the government

The government also liberalized its regulations governing foreign investments

investor-friendly policies

Removal of other unnecessary controls and restrictions

tax breaks and even subsidies on leased land in specific sectors

overvalued exchange rate

liberal long-term credit policies of development financial institutions, large

unearned economic rents accrued to industrialists
Subsidies—substantially reduced and cement imports permitte

The denationalization of number of agro-based industries. With the

denationalization of some small engineering units as well
Consistency and continuity in policies

Tax and governance reforms

Agriculture sector reforms

Industry and investment reforms,

Deregulation

Liberalization
 MAJOR
ACCOMPLSHMENTS
Luxuries were easily accessible

Easy access to low-cost consumer finance led to a sharp rise in the sale of
consumer goods such as cars, motor cycles, cell phones and home appliances

Pakistan economy was among the fastest growing economies in the world as
its economy had reached the size of $170 billion from a mere $70 billion in
1999

 http://economicpakistan.wordpress.com/2008/01/09/pakistan-flourishes/
The IT industry, which was virtually non-existent seven years ago,
has grown to be worth $2 billion of which $1 billion is export related

Investments in the energy sector have been influenced by the huge demand
for power generation in Pakistan

Nine Engineering World Class Science and Technology Federal

Universities by 2008 with foreign assistance.

The Compressed Natural Gas (CNG) sector of Pakistan had attracted over Rs
70 billion investments
Telecom sector attracted an investment of $ 9 billion.

Nine (9) world class Engineering Universities being developed and 18 Public
universities developed

PAK ranked 3rd best in world Banking profitability

http://www.daily.pk/why-musharraf-basic-comparison-
of-facts-1999-and-2007-7462/
CNG sector attracted over $70 billion investment

Major Mega projects like the Saindak, Rekodiq, Marble production, Coal
production and Mining & Quarrying

A new Oil refinery with UAE will fetch $5 billion & will process 300,000 oil
barrels a day
foreign investment came in projects like ICI Pakistan's PTA
plant, Engro Paktank and Engro Asahi polymer — to name a few.

GCC investments in Pakistan and future trends:-

03 January, 2007
Faryal Leghari
Researcher, GCC-Pakistan Relations Gulf Research Center, Dubai
The economic relationship of Pakistan with the Gulf Cooperation
Council (GCC) countries.

Pakistan received a record $4.6 billion in remittances during the

fiscal year 2005-06

Of the Middle East’s $2.06 billion contribution to remittances,

Saudi Arabia topped with $750.44 million, followed by the UAE
with $716.30 million, Kuwait – $246.75 million, Oman – $130.45
million, Qatar with $118.69 million, and Bahrain – $100.57
million.
The largest source of FDI in Pakistan for the year ending June 2006 was the
UAE with investments worth $1.42 billion

the US with $517 million

Saudi Arabia with $278 million

Multi-billion dollar investment projects proposals with Qatar

Pakistan-Oman economic relations saw interesting developments in the
financial, telecommunications and IT sectors.

Saudi investment in the Pakistani steel sector began with the laying of the
foundation stone for the $130-million Tuwairqi Steel Mill

Major Kuwaiti investments include a $1.5-billion oil refinery project at Port

Qasim, as well as infrastructure and real estate development projects in
Karachi
PAKISTAN
STRENGTHS AND
WEAKNESSES
STRENGTHS
Pakistan’s biggest strengths include

Abundant land and natural resources

Geo strategic location

Trained workforce

Investment policies

Infrastructure and legal system

Upcoming Financial markets

WEAKNESSES
Law and Order

Political stability

Economic strength

Government bureaucracy

Local business environment

Transparency of regulatory system

Protection of property rights

Infrastructure
WEAKNESSES
High business costs

Labor cost

Quality of life

Judicial system

Welcoming attitude

Child labor

Tax structure
www.rru.worldbank.org
 BENEFITS OF
FOREIGN DIRECT INVESTMENT

Helps in the economic development of the particular country where the

investment is being made

In the 90s FDI was one of the major external sources of Financing

FDI helps countries at times of economic hardships

 BENEFITS OF
FOREIGN DIRECT INVESTMENT

Foreign direct investment also permits the transfer of technologies

Assists in the promotion of the competition within the

local input market of a country.

The countries getting FDI from other countries can also develop the human
capital resources by getting their employees to receive training on the
operations of a particular business.
FDI helps in the creation of new jobs and thereby better salaries in a
particular country.

FDI allows for the development of the manufacturing sector of the

recipient country

FDI can also bring in advanced technology and skill set in a country

It has been possible for the recipient countries to keep their rates of

interest at a lower level .

 BOI TOP 5 REASONS TO INVEST IN PAKISTAN

Reason - 1: Geo-strategic Location

Located in the heart of Asia, Pakistan is the gateway to the energy rich Central Asian
States, the financially liquid Gulf States and the economically advanced Far Eastern
tigers.

This strategic advantage alone makes Pakistan a marketplace teeming with

possibilities.
Reason - 2: Trained Workforce

A large part of the workforce is proficient in English, hardworking and

intelligent.

Pakistan possesses a large pool of trained and experienced engineers,

bankers, lawyers and other professionals with many having substantial
international experience.
Reason - 3: Economic Outlook

Pakistan is one of the fastest growing economies of the world having touched a
GDP growth rate of 8.4% in 2005.

Today Pakistan has over 170 million consumers with an ever growing middle
class.

Foreign Direct investment has risen sharply from an average of $300 million
in the 1990s to over $3.7 billion in 2008-09. Fiscal deficit has declined from
an average 7% of GDP in the 1990s to around 3% in recent years

And FOREX reserves have increased from $3.22 billion in 2000-01 to $11.6
billion in June 2009.
Reason - 4: Investment Policies

Current investment policies have been tailor made to suit investor needs.
Pakistan's policy trends have been consistent, with
liberalization,deregulation,privatisation, and facilitation being its foremost cornerstones.
Reason - 5: Financial Markets

The capital markets are being modernized, and reforms have resulted in
development of improved infrastructure in the stock exchanges of the
country.

The Securities and Exchange Commission of Pakistan has improved the

regulatory environment of the stock exchanges, corporate bond market
and the leasing sector.
AREAS OF INVESTMENT

Areas of investment are agriculture, textile, telecom and IT, energy sector,

service industry, construction and building

RECOMMENDATIONS
According to the chiefs of some of the multinational companies (MNCs)
Pakistan still offers unmatchable economic fundamentals

but the way the government of Pakistan (GOP) has treated the foreign
investors in last two years is a source of serious concern

Pakistan does not only have an enviable track record of economic growth in
sixties but still it has the potential to repeat the past. It still enjoys
incomparable economic fundamentals
The country has often come out with pro-investment policies. However, the
poor implementation of policies have been distorting the system.

If the country wants to achieve a respectable position among the nations it has
to put the economy in order
No one can deny the fact that the country needs foreign investment.

If the foreign investment is required then Pakistan has to offer conducive

environment for foreign investors — comparable with other countries —
soliciting the same.
Pakistan shows all the positive indicators of economic growth.

The GOP is making endeavors to build Pakistan on modern lines to

become an Asian tiger.
Confidence-building Measures:

The close relationship between private and public sector is essential to build
confidence.

It is suggested that a forum be established where the private and the public
sector could sit together to discuss business-promotion related issues.

These kinds of public private partnerships will certainly help boost investor
confidence
Law and Order:

Satisfactory law and order situations is critical to attract investment in

Pakistan.

Political Stability:

Satisfactory political stability is also critical to attract investment

Removal of Bureaucratic Hurdles:

The laws and regulations should be simplified, updated, modernized, and

transparent, and their discretionary application must be discouraged.
Fiscal incentives:

Should be given liberally by the government to investors

through duty free imports and tax reliefs

Credit Facilities:

Urgent need to review credit facilities given to investors.

Labor laws:

Overprotective labor laws do not encourage productivity

and frighten away much needed productive investment.

Macroeconomic stability:

Some drastic and far reaching measures are needed.

To reduce the fiscal deficit on the one hand and to raise

trade surplus and foreign exchange reserves on the other.
Identification of potential investors and sectors:

potential countries like China, Malaysia and Korea should be targeted instead
of traditional partners in Europe & US.

New sectors for investment (mining and quarrying, tourism, construction,

etc.) rather than focusing on traditional sectors (financial business, textiles, oil
and gas, etc.)
Improvement in Tax Structure:

There is an urgent need to reduce the number of taxes

Transfer of Technology:

There should be no restriction on payment of royalty and/or technical service fees for
the manufacturing sector
ARMY OR DEMOCRATIC GOVT ???
HISTORY OF INVESTMENT
1947-2010
 INVESTMENT BENCHMARKS
Political stability;

Law and order;

Economic strength;

Government economic policies;

Government bureaucracy;

Local business environment;

Infrastructure;

Quality of labor force;

Quality of life;

A welcoming attitude.( the way the guests are received and entertained)
YOU DECIDE !!!!

THANK YOU !!!