LAHORE: Pakistani investors have abdicated their responsibility by withholding investments and handing over the domestic market to foreign products that satisfied the ever-growing demands of services and goods of its predominately young population.
The demographics of Pakistan demand the manufacturers to produce more, irrespective of the state of governance in the country.
They should chalk out a strategy with the realisation that governments in Pakistan would remain incompetent, inflation would remain high along with interest rates, and pervasive corruption would fuel energy and power shortages.
The credentials of Pakistan’s economy despite these drawbacks are still strong that it calls for massive investment. Pakistan’s population of 210 million is larger than 2/3rd of the population of the European Union.
The youth under the age of 35 constitute 65 percent of its population. This is the most consuming class the world over.
The consumption level of Pakistani youngsters can be judged by the fact that Pakistan is the 9th largest market for cell phones. Millions of phones are imported as local production is negligible.
Pakistan urgently needs investment in manufacturing, as the demand for manufactured goods is increasing constantly. Foreign investors are still shy of establishing their manufacturing plants in Pakistan due to terror threats and inconsistent government policies.
Still, they have been able to find a vast market in Pakistan for the products they produce elsewhere. The domestic investors minted money on their past investments when the economy was protected and the demand of goods was rising. They failed to upgrade their industries that paved way for imported stuff.
In 1999, Pakistan’s imports were $10 billion and exports were $9 billion. Two decades later the imports have shot up to over $50 billion and exports are only $25 billion.
It is worth noting that those domestic investors that upgraded their technologies are still in the driving seat and are excelling both in domestic and global markets. In textiles particularly the domestic market has been grabbed by them from the low tech millers. They are still excelling in exports while those operating on obsolete technology have lost the global market as well.
The successful private sector players are surviving on compromises, innovation and hard work. They have tackled the incompetence and corruption prevalent in the state by compromising on their margin to retain their skilled workforce that is the real asset of the companies.
Entrepreneurs that are now in trouble retrenched in hard times to stay afloat. In this process, they lost some of the best talent available in the field.
Medium-sized entrepreneurs that were barely surviving on most non transparent government policies would have earned huge profits in a transparent and well governed economy.
Time has come when instead of trying to please those in power; the businessmen should speak up and ask for a better deal from the rulers.