Ahsan Iqbal applauds PIDE’s initiative to focus on Productivity in Short & Long Term plans
Staff Reporter
ISLAMABAD: Pakistan Institute of Development Economics (PIDE) launched Pakistan’s One Year Growth Strategy during a workshop titled “Sectoral Total Factor Productivity in Pakistan at Planning Commission Auditorium.
Minister for Planning, Development, and Special Initiatives Prof. Ahsan Iqbal, while delivering his speech as the Chief Guest, said that our long-term growth is declining; we also have declining Investment and productivity, and we have the lowest investment rate among the neighboring countries. Historically, taxation has been the priority, and growth has been down on the list. Therefore, we need to make growth a top priority, and for that, we must focus on Investment, productivity, and exports.
Prof. Ahsan Iqbal further stated that Investment is the key driver of growth in the case of Pakistan. We must bring more Investment into the economy by addressing critical issues the investors face. Among those key issues, regulations are the main problem. Our regulatory structure is inefficient, and it increases the cost of doing business. Instead of facilitating Investment, it suppresses economic activities. Therefore, there is a need to bring regulatory reforms, and the current government is willing to take this initiative on a priority basis.
Energy also presents significant challenges to businesses in terms of affordability and reliability. In addition, the increase in the cost of production due to higher energy tariffs makes our product less competitive in the international market, he added.
He said that taxation and tax structure are complex. For example, we are killing transactions in pursuing tax targets. So we have to simplify the tax structure as well.
Similarly, if we look at our export performance, it is poor, and Pakistan is still unable to tap its potential. However, the emerging trends in the export sector indicate that if we act proactively, Pakistan can substantially increase exports. There is a revolution in the services exports in the form of freelancing, and Pakistan has enormous youth unemployment. We can provide employment opportunities to our youth by promoting freelancing and IT exports.
Federal Minister said that our industry is still exporting low-value-added products and is located at the lower end of the global value chain. We also have to consider integrating and moving towards the higher ends of the global value chain.
Earlier, Vice-Chancellor PIDE, Dr. Nadeem ul Haque, started by sharing welcome remarks. He said that Investment and productivity are key drivers of growth in any country. But unfortunately, both are not only pretty low in Pakistan but have been in a downward spiral over the years. The real test then is to raise the investment rate and productivity substantially.