Foreign Direct Investment and Economic Growth in Pakistan

Habib -ur-Rahman

Abstract


After World War II newly emerged nations inspired by industrialized countries of western world embarked upon economic development projects. Poverty ridden peoples of these countries had suffered at the hands of developed nations and they were anxious about adopting measures which could help alleviate poverty and bring socio-economic wellbeing. This urge compelled them to borrow from industrially advanced countries to gear up their development programs. Borrowing and then repaying with interest put them in a dangerous whirlpool of debt trap. Because with meager income they could not save to pay off their debts, therefore, outstanding amounts went on multiplying and many countries were afraid to be listed as defaulters. They were constrained to find out an alternate source of finances which could provide sufficient funds for initiating and completing development schemes. Thus, foreign direct investment was the only source which could help in not only implementing their planned development projects but also encouraged to undertake additional schemes of development and increase their gross domestic product growth rate. This paper discusses the circumstances which led to rely on foreign direct investment instead of borrowing from external sources. It also throws light on importance of foreign direct investment amidst other sources of financing.

Keywords


External borrowing, Gross Domestic Product, Foreign Direct Investments

Full Text:

PDF

References


State Bank of Pakistan (2015).Handbook of Statistics on Pakistan Economy. www.sbp.org.pk/departments/stats/PakEconomy_HandBook/Chap-1.3.pdf

Ministry of Finance, Islamabad. Govt. of Pakistan (2018-19). Growth and Investment.

Dar, A. A., Bhatti, H. M. A., & Muhammad, T. (2016). FDI and Economic Growth in Pakistan: A Sector Wise Multivariate Cointegration Analysis. The Pakistan Development Review, 67-88.

Guru SPREYA (2017). Role of Foreign Portfolio Investment and Foreign Direct Investment”http://www.yourarticlelibrary.com/microeconomics/foreign-investment/role-of-foreign-portfolio-investment-and-foreign-direct-investment/38226 accessed and retrieved on 1-1-2020.

Das Sthiti ( )Foreign Direct Investment (FDI) In India (Since 1991) http://www.yourarticlelibrary.com/india-2/foreign-direct-investment-fdi-in-india-since-1991/47523 accessed and retrieved on 01-01-2020.

Corporate Finance Institute, Vancouver, Canada in its publication “Foreign Direct Investment an International Business. accessed and retrieved on 01-01-2020. www.corporatefinanceinstitute.com/resources/knowledge/economics/foreign-direct-investment-fdi

Legace Martha (2006). How South Africa Challenges Our Thinking on FDIwww.hbswk.hbs.edu/Pages/browse.aspx accessed and retrieved on 01-01-2020

Tasneem Amna and Baber (2017). Foreign Direct Investment and Economic Performance of Pakistan: Is There Any Relation?www.tandfonline.com/doi/abs/10.1080/09765239.2011.11884944 Accessed and retrieved on 01-01-2020

Irfan et al (2014). Domestic Investment, Foreign Direct Investment, and Economic Growth Nexus: A case of Pakistan. www.hindawi.com/journals/ecri/2014/592719/?utm_source=google&utm_medium=cpc&utm_campaign, accessed and retrieved on 01=01-2020

Luis R de Mello (2007).Foreign direct investment in developing countries and growth: A selective survey” www.tandfonline.com/doi/abs/10.1080/00220389708422501?src=recsys, Accessed and retrieved on 01-01-2020.

Tejvan Pettinger (February 16, 2017) Foreign Direct Investment. www.economicshelp.org/blog/4987/economics/foreign-direct-investment/Accessed and retrieved on 01-01-2020.

Mio Wang (2009). Manufacturing FDI and economic growth: evidence from Asian economiespublished in Journal of Applied Economics Volume 41.www.tandfonline.com/doi/full/10.1080/00036840601019059 accessed and retrieved on 02-01-2020.

PL Beena, Laveesh Bhandari, SumonBhaumik, (SubirGokarn and Anjali Tandon( ). Foreign Direct Investment in India. www.assets.publishing.service.gov.uk/media/57a08cca40f0b64974001448/drc04_india.pdf -accessed and retrieved on 02-01-2020.

IBEF(2019) Foreign Direct Investment (FDI)www.ibef.org/economy/foreign-direct-investment.aspx-accessed and retrieved on 02-01-2020.

Adeolu B. Ayanwale (2007) FDI and Economic Growth: Evidence from Nigeria” https://opendocs.ids.ac.uk/opendocs/handle/20.500.12413/2677. Accessed and retrieved on 02-01-2020.

Najabat and Hamis (2017). Impact of Foreign Direct Investment on the Economic Growth of Pakistan http://article.sapub.org/10.5923.j.economics.20170704.01.html. Accessed and retrieved on 02-01-2020.

WDI-World Bank data base Pakistan.https://data.worldbank.org/country/pakistan. Accessed and retrieved on 18-11-2019.

State Bank of Pakistan. International Investment Position of Pakistan. http://www.sbp.org.pk/ecodata/Invest_pk.pdfaccessed and retrieved on 28-11-2019.

State Bank of Pakistan,Statistical Bulletin 2008-2013. http://www.sbp.org.pk/reports/stat_reviews/Bulletin/index.html. Accessed and retrieved on 03-12-2019.

Dawn (23-12-2019).Foreign investment jumps by 137% in first quarter of FY20: SBP data.https://www.dawn.com/news/1511386. Accessed and retrieved on 23-12-2019.

Hussain-Ishrat( 26-10-2017) A HISTORICAL ANALYSIS OF PAKISTAN’S DEBT PROBLEM (Foreign aid disbursement in different political regimes).Page 12 and 15 https://ishrathusain.iba.edu.pk/speeches/AnalysisofPakistansDebtSituation2000-2017-.accessed and retrieved on 24-12-2019.

Majid Aisha (2017) Financial Statement Analysis 2012-2016: Toyota Indus Motor Company--www.academia.edu/32819934/Financial_Statement_Analysis_2012016_Toyota_Indus_Motor_Comapny. Accessed and retrieved on 03-01-2020.

Hussain, Ishrat (2018). CEPEC & Pakistani Economy An appraisal, Center of Excellence for CEPEC,Islamabad. http://cpec.gov.pk/brain/public/uploads/documents/CPEC-and-Pakistani-Economy_An-Appraisal.pdf. Accessed and Retrieved on 14-01-2020.


Refbacks

  • There are currently no refbacks.


Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Creative Commons License
Sarhad Journal of Management Sciences by Sarhad University of Science & Information Technology is licensed under a Creative Commons Attribution 4.0 International License.
Based on a work at suit.edu.pk