Thursday, March 17, 2005

Lessons for Sindh/ Pakistan from China and India Experience

The recent IMF statement comparing business environment of China and India may be summarized as follows:

1. India is ready to take off economically but must make it easier forforeigners to do business in order to secure sustained growth

2. India lags well behind much of Asia in attracting foreign directinvestment. In 2003 FDI (foreign direct investment) to India totalled justfive per cent of gross domestic product compared to 31 per cent for Thailandand 35 per cent for China.

3. surveys consistently point to India as being one of the top two or threedestinations for FDI in the coming years, so opportunity is there for thetaking. What is perhaps important is to make India an easier place to do business

4. To start a business in South Korea it takes 22 days and in China 41. InIndia it takes 89 days

5. Enforcing a contract takes 425 days in India which is more than fivetimes longer than in Korea and nearly double than in China.

6. IMF called for "bold" economic steps to keep a growth momentum that wouldcreate 100 million jobs in the next 10 years.

7. India needs to put public finances on a solid footing and reducegovernment’s borrowing needs that would help free resources for privateinvestment.

8. While the economy has been growing robustly in recent years, India stillaccounts for less than one per cent of total global exports while averagetariffs are at about 22 per cent

I do not have comparable data for Pakistan. However, if Pakistan and Sindh want to develop and generate employment, they will have to follow swimilar policies. I must say that the idea of creating 100 million new jobs in ten years excites me greatly.

Kind regards,
Ali Nawaz Memon
720404 Antares Drive,
Gaithersburg, Maryland 20879
Phone 301-869-5447
Fax 301-869-3124


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