Pakistan’s economy has been ragged by two back-to-back crises. The global fuel and food price hikes twisted severe macroeconomic complexity as public finances worsened, inflation climbed, and economic growth slowed down. In Pakistan, the global financial crisis approached at a moment when the financial system was still recovering from the global pricing shocks, thus making the position more terrible as Short essay on Pakistan’s Economy. ADVERTISEMENTS: Pakistan is a developing country and like many other developing countries Pakistan has a semi industrialized economy and basically comprises of textiles, chemicals, food processing, the agricultural sector and various other blogger.comted Reading Time: 3 mins Pakistan is among some of developing countries who have achieved an average growth rate over 5. Pakistan economy has been emerged as an economy with 27th largest in world in term of Nominal. Pakistan has a mixed economy, major decisions are taken by Government and private enterprise, and also economy is exercised by these both sectors
BA English Essay: Economy of Pakistan – Pacans Pakistan
Pakistan is a country in South Asia with a population of million people, economy of pakistan essay, which is the fifth largest population in the world PBS, Pakistani economy is semi-industrialised with a well-developed agricultural sector and an increasing share of the services sector Iqbal, It is one economy of pakistan essay the fastest growing economies in the world driven by the rapidly growing middle class Kaplan, ; Alam, Along with that, it is necessary to underline a high average inflation rate which is shown in Figure 1.
The disadvantage of such high indirect taxes is that producers reimburse these costs by adding them to the end price of their products Khan, Figure 2 evidences that a current account balance has been increasing in the previous three years because of the increasing trade deficit, but this growth decelerated in due to devaluation of the rupee.
This is because of low exports entailed by tough competition in the textile production, the main item of the Pakistani exports. Domestic debt increased by five times and external debt by 1. Along with that, a cumulative depreciation of the exchange rate was at the level of This entailed the deceleration of private consumption growth from 6.
The industrial sphere growth decelerated from 4. Unfavourable weather conditions have undermined productivity of the agricultural economy of pakistan essay and led to economy of pakistan essay growth of only 0.
The perspectives of the Pakistani economy are vague although the potential drivers of growth are present. This also contributes to the availability of labour force Mirxa et al.
First, this labour force remains unskilled and second, agriculture substantially depends on weather and commodity world prices.
Besides, health, agricultural and educational deficiencies are present, economy of pakistan essay. This makes the contribution of agriculture in the Pakistani economy quite low. Second, there are two factors that may accelerate growth in the nearest future.
The first one is that Pakistan is an important centre of Islamic finance which provides significant capital flows while the Pakistan stock economy of pakistan essay is among the fastest-growing stock markets in the world Masood, Another factor is high amounts of transfers from expatriate workers which increase solvency of the country population.
On the negative side, the Pakistani economy can be characterised by low diversification and dependence on external energy economy of pakistan essay Baz et al. Moreover, the level of regional development is very different, with Karachi being the industrial and financial economy of pakistan essay of the country and Balochistan and other rural regions having slower development COFACE, The harm of this tax structure for the economy is that indirect taxes including import duties excise taxes and fees are essentially regressive which implies that they mostly strike the poorest segment of the population.
Furthermore, the applied system of indirect taxes turned to be too complex and ineffective while the introduction of the value-added taxation was sabotaged by the opposition Masood, As for the direct taxes, the number of tax payers is extremely low, namely about 1 million per million of the working population.
Moreover, tax avoidance has become a norm in Pakistan Cevik, This is very low compared to peer emerging economies which generates one of the most striking problems of the Pakistani economy, namely a great imbalance between the public sector income and expenditure Masood, Excessive expenditure includes persistent losses of some public enterprises IMF, and losses in the power sector World Bank, In addition, ineffective public investment exaggerates the mentioned imbalance Masood, economy of pakistan essay, Finally, the country is being torn apart by political instability.
The main recommendations are connected with addressing existing imbalances in the economy of Pakistan in favour of more effective mechanisms for managing and distributing funds. First of all, the disbalance between public consumption and revenues that has been existing for economy of pakistan essay should be mitigated.
The measures for attaining this goal can be the revision and reform of the tax system in terms of tax structure, increase in the volume of collected direct taxes and optimisation of the indirect taxes regulation. Along with that, economy of pakistan essay, the governance of public enterprises should be enhanced to reduce their losses.
Solutions to the problems in the agricultural and power sectors would also contribute to fostering economic growth. Baz et al. In particular, building new hydropower dams is required to provide the additional volumes of energy to the industrial sector and mitigate the deficit of water. In this light, the findings made by Uddin et al. These authors revealed that institutional factors including government size, legal structure and strong property rights, trade liberalisation and civil liberty have significant positive impact on FDI inflows, economy of pakistan essay.
Among the institutional factors, regulation was indicated to have the strongest influence on inward FDI flows to Pakistan. Moreover, outcomes obtained by Tabassam et al. Therefore, the government should undertake corrective measures to ensure political stability in the country. A potential driver of growth for the Pakistani economy aimed at addressing these problems is the realisation of the China-Pakistan Economic Corridor CPEC project.
This strategic project has been designed to stimulate economic relationships in the region as it will connect Pakistan's Gwadar port with the north-western part of China by Mirza et al, economy of pakistan essay.
This will allow for reducing power outages by means of increasing electricity generation capacity and investing in other sectors of the Pakistani economy, economy of pakistan essay.
Given these capital injections, Pakistan is expected to gain the targeted increase in GDP growth rate by 7, economy of pakistan essay. To sum up, the perspectives of the Pakistani economy look vague in the long term.
On the one hand, its potential for growth is represented by the ongoing increase in population and thus labour force as well as opportunities to increase its internal market, economy of pakistan essay. On the other hand, the existing imbalances between government revenues and expenditure, ineffective public spending, poor-balanced tax system, deficit of power and water and persistent political instability that frightens potential foreign investors, do not allow for gaining sustainable growth.
Alam, K. Baz, K. and Ali, H. Cevik, S. pdf, [Accessed on 17 February ]. Iqbal, A. Kaplan, S. Khan, B. Masood, A. pdf[Accessed on 17 February ]. Mirza, economy of pakistan essay, F.
Nishat, F. and Ullah, K. pdf [Accessed on 17 February ]. Tabassam, A. and Rehman, F. Uddin, M. and Liu, J. Copyright Applied Research Consulting Ltd. Essay Writing Service. Assignment Writing Service. Coursework Writing Service. Report Writing Service. Reflective Report Writing Service.
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Dynamics of Key Macroeconomic Indicators Pakistan is a country in South Asia with a population of million people, which is the fifth largest population in the world PBS, Figure 1. As for other key macroeconomic indicators, they are presented in Figure 2. Figure 2. Source: COFACE Figure 2 evidences that a current account balance has been increasing in the previous three years because of the increasing trade deficit, but this growth decelerated in due to devaluation of the rupee.
Strengths and Weaknesses of the Pakistani Economy The perspectives of the Pakistani economy are vague although the potential drivers of growth are present. Recommendations: Main Drivers of Sustainable Growth The main recommendations are connected with addressing existing imbalances in the economy of Pakistan in favour of more effective mechanisms for managing and distributing funds.
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CSS ESSAY: Economic crisis in Pakistan
, time: 49:43
Pakistan’s economy has been ragged by two back-to-back crises. The global fuel and food price hikes twisted severe macroeconomic complexity as public finances worsened, inflation climbed, and economic growth slowed down. In Pakistan, the global financial crisis approached at a moment when the financial system was still recovering from the global pricing shocks, thus making the position more terrible as Short essay on Pakistan’s Economy. ADVERTISEMENTS: Pakistan is a developing country and like many other developing countries Pakistan has a semi industrialized economy and basically comprises of textiles, chemicals, food processing, the agricultural sector and various other blogger.comted Reading Time: 3 mins Pakistan is among some of developing countries who have achieved an average growth rate over 5. Pakistan economy has been emerged as an economy with 27th largest in world in term of Nominal. Pakistan has a mixed economy, major decisions are taken by Government and private enterprise, and also economy is exercised by these both sectors
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