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February 22, 2020

FDI paean

Newspost

 
February 22, 2020

This refers to the article ‘An infallible bond’ (Feb 20, 2020) by Malik Muhammad Ashraf. I do not share the optimism about increased foreign investment from other countries, regardless of how strong our bonds may be. Why should Turkey, Malaysia or for that matter any other Muslim country invest in Pakistan when the domestic entrepreneurs are reluctant to do so? Recently, Saudi Arabia and the UAE had announced plans to make significant investment on the eve of their leaders’ visits to Pakistan. But nothing has materialized though both countries are making huge investment in our arch rival India. Poor governance, bureaucratic red-tape, high borrowing costs, excessive tariffs on utilities, runaway inflation, a lack of skilled labour and the absence of a clear economic roadmap do not provide an environment conducive for investment. When ad-hocism and indiscretion replaces sustainable long-term policies, investors become wary of taking risks. The paean of increased economic cooperation is merely a means for the incumbent government to divert attention from the worsening economy. Foreign investors follow domestic investors and not vice versa.

Erum Arif

Karachi