ECO603 GDB.1 Solution and Discussion
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The Case:
Politics of the world has been changed with the passage of time. Today’s economic as well as political environment is related to social media, internet sale and purchase, stock exchange and exchange rate ups and downs. All these are related to each other. Pakistan is an agrarian country and its major crops are cotton, wheat, rice and sugarcane. Imports are oil and mineral fuels, tobacco optical and medical equipment, metal ores and motor vehicles while exports are food items, live animal, leather, cotton and clothes. Economy of Pakistan and balance of payment mainly depend on agricultural sector, performance of public sector, political environment and weather condition.
Requirement:
After reading the above facts and figure, explain logically that how does political environment affect the exports of Pakistan?
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The Case:
Countries are exporting and importing according to their need and level of progress. Pakistan is also an exporting country. Major exports are cotton, wheat, rice, vegetables, fruits, fish, leather goods and salt while major imports are machinery, petrol, equipment, mobiles and vehicles. Pakistan is facing trade deficit due to less exports. Economy of Pakistan mainly depends on agricultural sector. According to a report, agricultural sector contributes 18.9 percent to Gross Domestic Product and absorbs 42.3 percent of labor force. The cotton and textile industries play a dominant role in exports of Pakistan. Increase in exports can solve the main issues of the economy like unemployment and poverty.
Requirement:
After reading the above facts and figures, suggest and discuss the steps that should be taken by the government in order to increase the exports of Pakistan.
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There is an urgent need for policy makers to adopt a cautious perspective when dealing with the recent revival of protectionism. The changing policy context of global competition requires that emphasis be placed on facilitating broad-based innovation. This is in sharp contrast to the current and past industrial policies that were based on import substitution and sector-picking. This paper briefly outlines Pakistan’s experience with industrial policy over the past 6 decades, and shows how protectionist industrial and trade policy regimes are ineffective with respect to equipping Pakistan to compete globally. The paper also outlines global best practices with reference to designing an enabling industrial policy and suggests policy reforms that are appropriate in the political and global context of Pakistan. There also exist contrary views about the scope and composition of industrial policy even within the government functionaries. There is a dire need for a shared vision and deeper consensus building. Thus this paper aims to highlight the radical contrast in perspectives that exists between the current policy of the ministry of industries and a policy conducive to a prosperous Pakistan.
