Wooing investors

With a rich resource base, competitive labour Pakistan can emerge as a world-class production theatre

In a bid to generate wealth and do away with red-tapism, the government has come up with a proactive pro-investors strategy.

 The intention is to raise at least $20-25 billion, and pitch Pakistan as a preferred zone for foreign and domestic investments.

 The policy is also an extension of the recently launched Special Investment Facilitation Council meant to make room for investors by creating a conducive environment, with all necessary state support to get going.

 The salient features are too tempting for the first time as they do away with minimum equity requirement, lifts curbs on foreign real estate developers and endeavours to promote greater convergence between trade, industrial and monetary policies.

 Pakistan has long been deprived of a realistic investment policy.

 Thus, the erstwhile policy to regulate it under the microscope of governmental authorities has been a nonstarter.

 Moreover, bureaucratic delays and corruption has stagnated any meaningful progress, and investors were seen shying away from putting in their stakes.

 The new approach, apart from creating an optimal investment climate, will: reduce the cost of doing business; streamline business processes; and facilitate ease of doing business through the creation of industrial clusters and special economic zones.

 There are some ifs and buts, nonetheless, in the new plan.

 The government’s resolve to bar investments in sectors that are considered as taboo like casinos, alcohol manufacturing, arms and ammunition, and mining, will need a lot of explanations.

 Pakistan with a rich resource base and competitive labour can emerge as a world-class production theatre, and result in a surge in exports.

 While the new investment policy has come close on the heels of a renewed agreement with the IMF, coupled with consultations from other international lenders, it is an opportunity in disaster to kick-start a new era of growth and development.

 The fact that investors will be enjoying a field day, and are permitted to hold a 60% stake in agricultural projects and 100% equity in corporate agriculture farming, makes it a hot-bed of real-time returns.