By Hamid Mahmood ISLAMABAD, April 11 (INP-WealthPK): The Pakistan government is pursuing export-led industrialization and import substitution policy for long-term economic growth. In the second phase of China-Pakistan Economic Corridor (CPEC), China seeks to boost Pakistan's exports by relocating export-oriented enterprises and forming joint ventures in a variety of disciplines. Adnan Khan, a socio-economic development specialist, told WealthPK that Pakistan is focussing on export-led industrialization in the second phase of CPEC. He explained that the special economic zones (SEZs) will create thousands of jobs, both directly and indirectly. He said all SEZs improved the country's infrastructure as well as contributed to alleviating the country's trade deficit, and are now set to assist the country's industrialization. According to former advisor to prime minister on commerce and industry Abdul Razak Dawood, the second phase of CPEC focuses on import substitution, and export-oriented industrialization, which was intended to be a game-changer, has yet to take off. Despite the fact that agriculture is the country's backbone, Pakistan is largely reliant on imports of food and primary products such as cotton. He stated that export-led growth can only be sustained through production-led growth with a diverse industrial base and agricultural modernization. According to WealthPK research, Pakistan's exports surged enormously in 2021, reaching $6.68 billion, a 29.66% gain over the previous year, and the largest growth in a decade. The increase is shown in the given graph. [caption id="attachment_65868" align="aligncenter" width="696"] Source: Comtrade database/WealthPK research[/caption] Productivity and innovation will be boosted as a result of technological convergence and enhanced production processes, as well as the growth of human capital. The diminishing exports due to a lack of innovation and old manufacturing processes will change, and it is envisaged that Pakistan would not only reclaim its lost market share, but will also have the opportunity to enter new markets with new goods. The SEZs are meant to boost investment in exportable goods and import replacements, as well as attract foreign investment, under the industrial cooperation and development strategy. The SEZs are scheduled to be established along the route as part of the CPEC project, with the goal of assisting the industry in delivering products to prospective markets in the shortest time feasible. In order to connect to both input and output markets, economic activity in any context requires a time and cost-effective framework. The corridor's link to China and the Gwadar seaport will act as a catalyst, allowing the SEZs to thrive and exports to increase. Infrastructure development not only improves non-perishable on-road transportation exports, but also allows many perishable item providers to offer their products in a timely and dependable manner in response to market demand, both quantitatively and qualitatively. Depending on the nature of the economy and rules governing specific industries, the SEZs have a variety of effects on the economy. The CPEC's SEZs would attract international investment due to the cost-effective transportation, as well as lower labour and other inputs. The lack of a requisite varied range of internationally competitively priced quality items stifles exports. The bulk of trade surplus is due to the existing capacity of large-scale export-oriented manufacturing companies that have been unable to make considerable progress from basic manufacturing to sophisticated products production. Because the government's budgetary resources are limited, it should enlist the help of the private sector, notably through public-private partnerships (PPPs). To bring bankable PPP projects to market, the government's legal, regulatory, and institutional frameworks and capacities may need to be enhanced. This approach should help industries that rely on exports. The government must eliminate administrative obstacles in order to enhance exports and the advantages of foreign remittances. These contributions can be bolstered even more with bilateral and international aid.