Pakistan should double investment-to-GDP ratio: BOI chairman

Says current level is around 15%, which is targeted to increase to 25% in next five years

LAHORE: Pakistan needs to double its investment-to-GDP ratio to accelerate the economic growth, said Minister of State and Board of Investment (BoI) Chairman Haroon Sharif.

The investment-to-GDP ratio in Pakistan is around 15% against 30% in Sri Lanka, Bangladesh and India; a macro-level target of 25% for investment-to-GDP is set for next five years," said Sharif, while speaking at the Lahore Chamber of Commerce and Industry (LCCI) on Monday.

He said that the country will have to take hard reforms to get rid of the International Monetary Fund (IMF). Focus on productivity, transfer of technology and job creation can help prevail over economic challenges.

He said that there was a need to promote value-added exports to get more benefits and earn much-needed foreign exchange, while the tax-to-GDP ratio would have to be increased.

State-owned enterprises have posed various challenges for the economy and this issue would have to be tackled, he added.

"It is a good sign that foreign investment is rising. There is a very good response from the United Arab Emirates (UAE), Saudi Arabia and Korea."

Talking about the special economic zones (SEZs), Sharif said that these need uninterrupted power, gas and flow of funds. Chinese investors are very keen to come in, he said, adding facilitating local investors is the top priority of the government.

LCCI President Almas Hyder said net foreign direct investment (FDI) for 2017-18 is only $3.1 billion and Pakistan needs to improve its investment climate to attract more FDI. The best way is to develop an investment strategy that is equally beneficial to local and foreign investors.

Published in The Express Tribune, November 20^th, 2018.

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