Ayesha Saba

Pakistan needs to put in place appropriate policies and initiatives to involve its diaspora in the mainstream capital market and mobilize their income and wealth into productive investment vehicles in the form of innovative financing for beneficial projects, said Junaid Ahmed, Senior Research Economist at the Pakistan Institute of Development Economics (PIDE), while talking to WealthPK.

“As Pakistan continues to seek ways to bolster its economy and improve the lives of its people, tapping into the potential of its diaspora community is an opportunity that cannot be overlooked.”

“With a vast network of Pakistanis living abroad, there exists a significant pool of income and wealth that can be utilized to fund beneficial projects in the country. The expatriates in the US, the UK, and the Middle East, are particularly well-financed and highly educated.”

“Pakistanis overseas in these countries have demonstrated interest in enhancing FDI in the country but their investment decisions are often closely tied to the geopolitical factors,” he said. “They invest in Pakistan in various ways, including sending remittances, investing in real estate, buying stocks and bonds, starting businesses, technology, and tourism. However, there are several bottlenecks and hurdles that can hinder their investment efforts.”

Sharing his concerns, Junaid said, “One major challenge is the lack of clarity and consistency in government policies and regulations, which can create uncertainty and discourage investment. In addition, bureaucratic hurdles make it difficult and time-consuming to start and operate a business in Pakistan.”

“Pakistan must work to build trust with its diaspora community by providing transparent and reliable information about these investment opportunities. This may involve partnering with reputable financial institutions or offering incentives, stable economic policies, favourable tax laws, and a streamlined bureaucracy,” he suggested.

This situation can be handled only through a long-term roadmap, he added. Talking to WealthPK, Ismail Iqbal, Securities head of research Fahad Rauf said, “Involving the diaspora in providing capital investments for economic development projects can bring significant benefits, including increased funding, access to new markets, and new ideas and perspectives.”

“The government should consistently strive to prepare the ground for attracting larger FDI flows in the medium and long term and render the overall domestic environment more attractive to foreign investors.”

“Pakistan must first develop policies and initiatives that make it easier for the diaspora to invest in the country. This may involve creating investment vehicles that are specifically tailored to the needs of the diaspora, such as bonds or mutual funds that offer attractive returns while also supporting important projects in Pakistan,’’ he said.

Credit : Independent News Pakistan-WealthPk