Uzair Bin Farid

ISLAMABAD, August 23: The investment from China will increase in Pakistan as soon as the country improves its policy structure and corporate governance, WealthPK reports.

Currently, China has invested about $64 billion in Pakistan in different sectors. Federal Minister for Planning, Development and Special Initiatives Ahsan Iqbal said that Chinese investment would increase after the improvement of corporate governance in Pakistan.

Talking to WealthPK after attending a seminar titled “CPEC: A Catalyst for Economic Development of Pakistan,” the minister said that China-Pakistan Economic Corridor is the hallmark strategic partnership programme between the two countries. The seminar was arranged by the China-Pakistan Study Centre at the Institute of Strategic Studies, Islamabad.

Ahsan Iqbal said that the investment made by Chinese companies in different sectors, including energy, infrastructure, technology and special economic zones (SEZs), surpassed all the previous Foreign Direct Investments (FDIs) in the country. “Chinese companies have invested by taking part in the direct bidding for the projects in Pakistan,” he added.

He told the seminar that the participation of Chinese investors in direct bidding increased transparency and also helped the government in awarding the contracts to the best available tender. He also stressed the need for expediting work on the ongoing projects to make room for further investment in the country.

The minister said that currently more than $1 trillion of FDI is floating in the international markets and Pakistan has started to attract loads of it after improving its ease of doing business environment.

The time for complacency, however, has not arrived yet. Pakistan still has to do a lot more to attract more FDI since the marginal returns for investing in the country are huge given its talented youth and natural endowment of strategic and precious resources.

The mutual importance of Pakistan and China is not matched by any other strategic partnership in the world. The full fruits of this partnership have not been collected yet, since Pakistan has a lot of room for improvement in its policy structure and corporate governance.

Improving the policy structure results in increased economic growth. The continuity of policies ensures the initiation and timely completion of mega-development projects. The timely completion of a development project according to the feasibility helps in saving human and monetary resources for further utilisation in other schemes of public interest.

Research by WealthPK suggests that the economic growth of China would not have been possible without meeting deadlines and improving the environment for capital firms by initiating legal reforms.

The improvement of corporate governance will attract more firms to invest in Pakistan. The improvement will reduce the timeframe for getting things done. The delay in the completion of projects results in the loss of monetary resources and an increase in cost besides a waste of time.

“It is the responsibility of the government to improve the environment in the country so that the vacuum of investment can be easily filled up by the willing partners aboard. It is possible only through ensuring the continuity of policies and improved corporate governance,” said the minister.

Credit: Independent News Pakistan-WealthPk