Pakistan is strategically located to become Asia’s premier trade, energy and transport corridor. It is also 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. 55% of our population is below the age of 19, which bodes well for long-term sustainable economic growth. Pakistan has a strong middle class. 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. Despite being geographically close to India and Sri Lanka, Pakistan is quite unique with its own distinct culture and set of circumstances. By 2050, it is predicted to be the 16th largest economy in the world, overtaking economies like Canada and Italy. Other factors that define Pakistan include its younger population and its growing middle class, the fact that English is the lingua franca of the business community, and its highly evolved services sector that contributes 56% of GDP.
Pakistanis are actually the biggest consumer spenders in Asia, so there is a lot of potential for foreign business. Financially, production and labor costs are lower in Pakistan, so it offers a higher yield than surrounding countries for investors. The China-Pakistan Economic Corridor is seen as a bold move to further Pakistan’s economic outlook. The joint venture between China and Pakistan aims to not only bring prosperity to Pakistan but also ensure its future by bringing in local jobs and investment.
The best investment in Pakistan could be accessed by different people in several ways in affiliation with their perception. There are several best investment opportunities in Pakistan in different sectors, but real estate investment is at the top of the tier. The economy of Pakistan is affected by different factors, and due to which some businesses thrive and others suffer. Factors such as government resources management and policies are the main factors affecting businesses. Above all that still, there are investment opportunities that you could exploit for gaining exponential profits. The best investment in Pakistan could be considered as follows:
Pakistan is the 5th most populous country in the world, with 220 million citizens, more than 60 million strong labor force and a growing middle class. Out of total population, 36.38% resides in urban areas whereas 63.62 lives in rural parts. There is a growing demand for houses due to a 2.4% annual population growth rate. The country’s construction industry accounts for 2.53% of Gross Domestic Product (GDP) according to the Pakistan Economic Survey. The sector employs 7.61% of employed Pakistani labor force. China Pakistan Economic Corridor (CPEC) has given a boost to the construction sector through the influx of infrastructural projects including highways, power plants, and dams. Pakistan’s construction sector provides up to 380 billion PKR in GDP.
Pakistan is rich in its tourist destinations offering a diverse range of choices for different types of tourists. The country is home to one of the oldest civilizations in the world, has innumerable locations of scenic beauty, world’s highest mountains, many religious and historic places, unique arts and crafts and a rich culture and heritage. The British Backpacker Society ranked Pakistan as the world’s top adventure travel destination, describing the country as “one of the friendliest countries on earth, with mountain scenery that is beyond anyone’s wildest imagination”. Pakistan is home to a number of UNESCO world heritage sites like, Archaeological Ruins at Mohenjo-Daro, Buddhist Ruins of Takht-i-Bahi and Neighboring City Remains at Sahr-i-Bahlol, Fort and Shalamar Gardens in Lahore, Historical Monuments at Makli, Thatta, Rohtas Fort and Taxila. Pakistan is home to 108 peaks above 7,000 meters and probably as many peaks above 6,000 meters. There is no count of the peaks above 5,000 and 4,000 meters. five of the 14 highest independent peaks in the world (the eight-thousanders) are in Pakistan (four of which lie in the surroundings of Concordia; the confluence of Baltoro Glacier and Godwin Austen Glacier).
The government is actively promoting ‘religious tourism’, as it is one of the most significant revenue-generating businesses in the world. e.g. kartarput project. The government will also actively participate in the birthday celebrations of Baba Nanak. In the past, only 3,000 visas were issued to Sikh pilgrims. The initiative has also drawn the attention of the Sikh community around the world. A recent survey data revealed that a whopping 83% of the eight million diaspora Sikhs living outside India had shown interest in visiting Pakistan. Also, 79% of the 20 million Indian Sikhs expressed an interest in visiting Pakistan. In KP, which is dotted with sacred Buddhist sites the government is working with the World Bank to develop a Buddhist trail to attract Buddhists, and in particular, monks from across the globe.
The 4th Industrial Revolution is currently taking place and it is digital. The actual size of 2016 digital economy was $11.5 trillion globally, which was 15.5% of the global GDP. The base digital assets comprise one-third, or $3.8 trillion, while digital spillover effects account for the remaining two-thirds, $7.5 trillion. Pakistan, which has about 60% of its 200 million population in the 15 to 29 age group, represents an enormous human and knowledge capital. Pakistan has more than 2000 IT companies & call centers and the number is growing every year.
Pakistan has more than 300,000 English-speaking IT professionals with expertise in current and emerging IT products and technologies, 13 Software technology parks, more than 20,000 IT graduates and engineers are being produced each year coupled with a rising startup culture. In accordance with Pakistan Vision 2025 and the Digital policy of Pakistan 2018, the ICT industry size is targeted to reach $20 billion by 2025.
Pakistan is home to the world’s sixth largest population with a growing middle class. There are approximately 17 million middle class households and 102 million middle class individuals. The food and beverage processing industry is the 2nd largest industry of Pakistan after textiles, accounting for 27% of the value-added production and 16% of employment in the manufacturing sector. Food processing accounted for an annual average of $223.5m in FDI from 2012-2018. The three major industry groups are (1) frozen food (2) value addition in major food crops and (3) fruits, vegetables and intermediate products. With a population approaching 210 million, Pakistan is the 5th most populous nation in the world and continues to grow at a high rate of 2.4% per annum. Transport itself contributes 22.3% of the services sector GDP and accounts for approximately 6% of the nation’s total employment.
International transport is connecting Pakistan via its border crossings, ports and airports to its neighboring countries and further abroad. Pakistan’s economy relies on these international connections, including a large Pakistani workforce in the Gulf States that fly in and out. In addition, there is a growing emphasis to increase trade with the Central Asian region. Pakistan is the 8th largest exporter of textile products in Asia. It is 4th largest producer and 3rd largest consumer of cotton. It comprises of 46% of the total manufacturing sector and provides employment to 40% of the total labor force. A 5% of the total textile companies are listed on the stock exchange. There are 423 textile industries working in the country. Pakistan has supply base for almost all man-made and natural yarns and fabrics, including cotton, rayon and others. This abundance of raw material is a big advantage for Pakistan due to its beneficial impact on cost and operational lead time.
While the aforementioned policy measures and reforms currently being implemented are steps in the right direction, there still exist some areas that, if focused upon, would complement the aforementioned efforts in terms of improving the overall investment climate in the country such as coherent and consistent policy framework is needed. There should be a collaborative implementation of the announced human capital policies, clear communication of tax measures is vital for their successful implementation. The focus should be on identifying and incentivizing firms with a high-growth potential. Finally, the role of the state must be enhanced to lead investments in important segments of the economy
Muhammad Shahbaz
School of Management and Economics,
Beijing Institute of Technology, Beijing, China.
Email: muhdshahbaz77@gmail.com
