Written By Hassan Khan

The economic stability of any country is heavily dependent upon the business opportunities available in the country, to promote foreign and domestic investments. Pakistan has the most liberal investment policy in the South Asian region. It is the 27th Largest economy in the world in terms of purchasing Power, and the 45th largest in absolute dollar terms. Its GDP remained in the 6-8% range in 2004-06. In 2005, the world Bank‘Ease of Doing Business 2010’ ranked Pakistan 85 among 181 countries around the globe. Pakistan ranks highest in South Asia, even higher than China, Russia and India. The main indicators as per this report are as follows: Pakistan the top reformer in its region and in the top 10 reformers globally. The World Bank (WB) and International Finance Corporation’s (IFC) flagship report

From the above it can easily be construed that Pakistan has a very liberal investment policy in the South Asian region. The present incentives include:

• Almost all economic sectors are open for foreign investors
• Foreign equity up to 100% allowed
• No Government permissions required, only terms & conditions apply
• Attractive incentives package including:-
• 0-5% customs duty on import of machinery
• No sales tax on import of machinery
• No withholding tax on import of machinery
• No duty on raw material imports for 100% export based products
• Specialized Industrial zones and Export Processing Zones

In addition to the above, the prevailing policies allow remittance of capital, profits, royalty, technical & franchise fee. There is no differential treatment between local and foreign investors and they can avail credit as easily as any local investor. The legal framework regarding protection of investors’ rights is already in place and Pakistan is ranked way better than any other country in the region. After the dismal performance of the industrial sector following the 1972 nationalization, a change occurred in the government’s approach toward the role of the public and private sectors. The two subsequent Acts, in this respect, were implemented namely Foreign Private Investment (Promotion & Protection) Act, 1976 and Protection of Economic Reforms Act, 1992, which were tuned towards attracting foreign investments. The 1976 Act guaranteed the remittance of profit and capital, remittance of appreciation of capital investment, and relief from double taxation for certain countries. Foreign investment was also encouraged in industrial projects involving advanced technology and heavy capital outlay like engineering, basic chemicals, petrochemicals, electronics, and other capital goods industries.

In November 1997, the government issued the New Investment Policy which includes major policy initiatives. Now foreign investment is now allowed in sectors like agriculture and services, which constitute above three fourths of gross national product. The main objective of the new policy is to enhance the level of foreign investment in the fields of industrial base expansion, infrastructure and software development, electronics, engineering, agro-food, value-added textile, tourism, and construction industries. A new industrial policy package was introduced in 1989 based on the recognition of the primacy of the private sector. The Board of Investment (BOI) was set up to help generate opportunities for FDI and provide investment services, which has been quite effective in attracting investors globally. Pakistan is considered to be a favorable country for investment by the foreign investors, as the “Ease of Doing Business Index” reflects. The overall business environment is investor friendly, as the foreign investors are free to invest in any sector, with equal treatment for foreign and domestic investors alike. During recent past there have been some substantial corporate acquisitions by foreign investors, as follows:

• PICIC by Singapore based Temasek Holdings
• Union Bank by Standard Chartered Bank
• PTCL by Etisalat
• PakTel by china Mobile (publicly listed state owned enterprise of China) etc

The figures for Foreign Direct Investment in the country are as below:

*- Until Jan 2010

Source=BOI (Fig in US $ billions)

From the above it is reflected that the foreign investment surged in the period from 2004 till 2008, and then it declined onwards. The main reason for the decline may be attributed to the global financial meltdown; however the same has not been able to rise back to the desired level, after the crisis. In order to enhance the confidence level of foreign investors, there are certain key factors, which if played properly, can be effective in attracting foreign investment, some of which are discussed below:

In spite of the above strengths, there are a number of challenges which Pakistan has to face, to promote it in attracting foreign investments. Recently we have been facing severe challenges like the War against Terrorism, general law and order issues, energy crisis, disparity in balance of payment, heavy debt burden and corruption, due to which the economy took a downturn. While there has been significant progress in the War against Terrorism and law and order situation, the government should take some long term concrete and visible measures that should be geared towards bringing economical stability in terms of continuous energy supply, long term infrastructure for industry, improving the rupee dollar parity etc. These challenges are of severe nature and require a steady long term approach by the government in the shape of sustainable policies.

The Government has taken some extra ordinary steps for energy conservation recently, by announcing a 5 day working week, in an attempt to ensure smooth supply to industrial sector. Another aspect which needs to be looked into is providing a transparent and fair business atmosphere, which is surely expected to bring a much needed boost to our economy. With these steps, the country shall become an investors’ paradise.

After surfing on different website I realized that God has given us the treasures and our country is small in size compare to others yet it is very gifted with natural resources or rather call it “The Treasures”. Allamdulliah We are blessed with many things we have Mountains, Seas, river , fertile land and everything that is needed to make country grow.

There were certain things which really caught my eyes and I was amazed to and thought why media never highlight these things, these things will give us the new hope. So I decided to highlight these really interesting things on my blog.

Salt mines

The first thing that I came across was the salt mines; I was really amazed to know that the world largest coal mine was discovered in Pakistan. We are the only country for having the salt mines with proven reserves of about 10 billion ton in three mines including more than 6.687 billion ton only in the Khewra rocky salt mine, located in the area of district Jhelum. Other two salt mines are Warcha and Kalabagh. The salt mined in khewra is the best, finest and in natural state in the world. It is also belived that salt has been mined in Khewra before the Alxender the great invaded the area.

According to one report the annual production of salt at khewra is about 300,000 tonnes, which is enough to last for 400 years to come.

The other salt mines are wercha which is located 276 km from the Islamabad. The salt appears to be in broken and irregular salt domes . and Kalabagh Salt Mines are located on the bank of the Indus River. Salt is excavated by Room and Pillar method. Some of the chambers are more than 80 meters deep where the salt is still mined manually. There are 13 different kinds of salt seams with different shades of color

We also import around 10-18 thousand tones of salt annually to India only.

Khewra Salt Mines has 1290 meters long tunnels. The mine is anopen challenge to an adventurous spirit. It has 17 levels and there are 50 feet of rock salt between each level in which there are veryl arge chambers, made when salt was extracted.

Coal Reserve

The other treasure which I discovered was coal. We have the 7^th largest coal reserves. The coal can be used in many thing most importantly it can help in creating the electricity which is the most common cry on the public. Its been estimated that thar 185 billion reserve can produce 10,00MW for 300 years

Our coal reserves are estimated at 175 billion tons which according to the Vice-Chancellor (VC) of Punjab University, Professor Dr Mujahid Kamran equal 618 billion barrels of crude oil. According to the most reliable analytical reports Saudi Arabian crude oil reserves are estimated at around 260 billion barrels. At 60 Dollars per barrel this equates to 3708 Billion Dollars or approx. 4 Trillion Dollars (at current prices). At future prices these reserves will be worth 8 or 24 Trillion Dollars. This is enough money to build the most modern infrastructure, the best roads, the best hospitals, the best education, the best universities, the best hi-speed rail system and the best public transportation system on the planet

In Balochistan there are still many coal reserve which are yet to be discovered, I will not go into the detail of coal reserve as my project mate Sidra Pasha has already written an article on this topic, you can refer to her blog for more details

Balochistan

Balochistan, is the least developed province of the Pakistan yet its full of treasure, tochief mister Nawab Mohammed Aslam, Balochistan is vital for Pakistan economic growth. Its seems like Allah has showered extra blessing on Balochistan, there we can find graphite sulphur , gas, coal graphite, gold and only God knows what is more there as still the large part of the province is undiscovered.

The sui has field is the biggest natural gas field im Pakistan. The gas field was discovered in 1955. Sui gas accounts for 26 percent of Pakistan gas production. Its is belived that there are many gas field in Balochistan which is yet to be discovered.

Aluminium minerals are also found in balochistan. aterite occurrences have been reported from Ziarat area of Balochistan. Zones of high aluminium concentration are suspected in these laterites which needs detailed geochemical investigations. In Jamaica high grade bauxite deposits are hosted in White Limestone Formation of Middle Eocene-Lower Miocene age. Many sinkholes have developed in this karst topographic country that hosts thickest bauxite occurs. Here the ore contains 48 to 50 percent alumina with 18 to 20 percent iron oxide and the reserves are estimated at several hundred million metric tons. Fairly good chances of presence of bauxite in similar limestone terrain in Lasbela-Khuzdar-Kalat-Quetta-Zhob mountain belt are predictable. Large sinkholes and caves developed in limestone exist, particularly in Bolan district of Balochistan. These and other sinkhole areas occurring at many places may be specifically explored for bauxite.

The graphite and zinc are also found in dilband, they have called Chinese official to dig it, according to ministry of minerals they according to the sources of Minerals Ministry, the mining of the said minerals on trial basis is underway in the area and it is hoped that the production of the minerals will be kicked off within a few months to come. It is estimated that 1 million tonnes of Zinc and 32,000 tonnes of Graphite will be dug out on annual basis

Copper and gold reserve were recently discovered in Balochistan`s Rekodiq and will contribute 1.25m to the economy. The Rekodiq project is estimated to produce 200,000 tons of copper and 400,000 ounces of gold per year, at an estimated value of $1.25 billion at current market prices. The copper and gold are currently traded at about $5,000 per ton and $600 per ounce respectively in the international market. This discovery has put Rekodiq in top 7 copper reserve of the world.

Agriculture

Agriculture has always been Pakistan’s biggest tool, We have been blessed with very fertile land, we have the 2^nd best irrigation system in the world. Our Cotton wheat are rated among the best in the world. If we manage it carefully and effectively we will be able to get great revenue.

Workforce:

We are the treasure too, we have seen people going abroad and making the name of Pakistan. The brain of ours will help us improving the country and we are the biggest treasure. Everyone is blessed with some skills which he can use to betterment for the country. So all the bloggers should identify their true skills on how they can help Pakistan achieving the great height. All the things I have discussed will be useless if we don’t utilize ourselves properly

We need to work hard to get the treasure out; even pirates travel day and night in their ships, follow the direction of the maps and face the hardship on their way to get the treasure. They have the commitment will and unity to achieve the treasure. So why can’t we have that determination.. The blame game has to get over now or it will get too late.