The Pakistan Development Review
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Dynamic Modeling of Private Investment in Agricultural Sector of Pakistan
Get PDFAgriculture is the single largest sector of the economy of
Pakistan, which has a large number of for warding and back warding
linkages. This sector is contributing 21 percent to GDP and employing 44
percent of the workforce. Like other developing countries, poverty in
Pakistan is a rural phenomenon; therefore, its development will be a
principal vehicle for alleviating poverty. Recent global food crises
again providing an opportunity for developing countries like Pakistan to
give more serious attention to the development of agriculture. There is
no doubt that development of agriculture depends on investment in this
sector. Investment is a central issue in macroeconomic theory; it plays
an important role in economic growth of a country as it raises the
productive capacity of the economy and promotes technological progress
through embodiment of new techniques. Investment spending is usually
volatile because it depends on multiple factors, and is responsible for
much of the fluctuations of GDP over the business cycle [Dornbush, et
al. (1999)]. Therefore, it is very important to explore the determinants
of investment. The Classicals (Smith, Ricardo, Say, Marshall, and
others) maintained that free markets are the best route to national
prosperity and economic growth, and there is no need of government
intervention to activate and regulate the economy. Keynesians (1936), on
the other hand, believed that there is need for government intervention
to activate and regulate the saving and investment behaviour of the
society
Impact of WTO’s Trade Liberalisation on Selected Food Crops in Pakistan
Get PDFThere is a great potential in Pakistan for production of all
types of food commodities due to vast natural resource base, covering
various ecological and climatic zones. Most of the agricultural
commodities produced in the country are consumed by the local population
while the rest is exported in the form of primary products and some
value added products. Previously, Pakistani products had a good market
overseas with no restrictions of quality and quantity but under the
changing environment affected by WTO, it is expected that Pakistan will
face a strong competition in the agriculture sector from its competitors
in the world market. According to the neoclassical trade theory, trade
flows and pattern will develop along the lines of comparative advantage
and competitiveness that can act as indicators of trade potential and
direction. There has been extensive government involvement in the
determination of the overall structure of agriculture and its patterns
of production, employment and trade. Pakistani government has been
intervening in agriculture sector in the past in order to support
agricultural production, income supports, ensure food security, improve
the balance of trade, reduce consumer prices, address environmental and
regional concerns and to pursue sanitary and phyto-sanitary objectives
[Hassan (1995)]. Pakistan is a founding member of the General Agreement
on Tariffs and Trade (GATT) since its creation. Following the Uruguay
Round negotiations, all agricultural products were brought under
multinational trade rules by WTO, under the Agreement on Agriculture.
This established a framework to begin liberalising agricultural trade
through the reduction of import duties (tariffs), trade-distorting
production subsidies and export subsidies. Prior to the Uruguay Round,
trade in agriculture was highly distorted. Market access for
agricultural products was limited as most markets were restricted by
physical import barriers. The presence of massive domestic subsidies led
to overproduction of temperate crops in the developed countries that led
to excess supply, and export subsidies were used to dump the surplus
agricultural output in international markets. This resulted in depressed
market prices and, in spite of being low-cost producers of agricultural
products; developing countries could not compete with the subsidised
exports from developed countries
Residential Demand for Electricity in Pakistan
Get PDFUndoubtedly, in the new millennium, the importance of energy
sector for the development of a country is undeniable. Rapidly
increasing knowledge along with speedy technological innovation has
resulted in the provision of abundance of facilities. This has made the
human beings, consumers or producers, much demanding for energy sources
that are used to run mechanical processes. There are various sources of
energy which include oil, electricity, gas, coal and nuclear. Countries
differ in the usage of alternative energy sources. In Pakistan the major
energy source is gas which is 41 percent of the total energy supplied.
The other energy supply sources along with their percentage shares are
as follow: oil (29 percent), hydro (12.70 percent), coal (12 percent)
and nuclear (1 percent).1 Electricity is one of the most important
source of energy in Pakistan. It has become a necessity in the present
life, having a wide range of uses in residential as well as in
commercial sector. Table 1 describes the major domestic users of
electricity in Pakistan along with their respective shares of
consumption. It is obvious from the table that residential consumption
of electricity has the highest share
Price-setting for Residential Water: Estimation of Water Demand in Lahore
Get PDFThe population of Lahore has roughly doubled over the past
twenty years, and an increase of two million is expected by the year
2020 [UN (2005)]. This has important implications for city planning as
demand for housing, electricity, water, sanitation, public health,
education, and infrastructure grows accordingly. Water and Sanitation
Agency (WASA), the city’s official water supplier, has often responded
to the growing demand by offering the supply-side solution: augmenting
supply capacity by exploiting new water resources.1 Such investments are
costly, but in view of the public good nature of water, WASA has kept
tariffs well below the costrecovery level, relying on heavy loans and
subsidies. While this arrangement may have worked in the past, it is now
becoming increasingly unsustainable, because (1) WASA is facing severe
financial constraints and which has led to poor service and
underinvestment, and (2) the environmental cost of extracting water is
increasing. With its low tariff rates and continually increasing costs,
the WASA Lahore is unable to meet even its operation and management
(O&M) costs [WASA (2007)]. WASA has been receiving financial
assistance from the provincial and Lahore district governments as well
as international donors in the form of grants and loans with the grant
element gradually diminishing over the passage of time. In 2007, WASA
currently owed Rs 5.6 billion to these agencies [WASA (2007)].
Deteriorating financial situation has also led to short-term planning,
reactive operational strategy, and underinvestment in asset maintenance,
future capacity, IT equipment, management and accounting information
system, and training [IFC (2005)]. Consequently, WASA has shown
suboptimal performance: low pressure and irregular supply, leakages,
poor customer service, etc
Trends in Polarisation in Pakistan
Get PDFThis study analyses the trends in polarisation in Pakistan, in
its rural and urban segments and its provinces, at the micro level
during the period 1992-93 to 2001-02. Estimations are made by using the
Bossert-Schworm measure (2006). The study finds fluctuating trends. In
general, polarisation declined in all regions of Pakistan during 1996-97
and 2001-02, while 1998-99 is the period of maximum polarisation.
Incorporating the household size reduces the extent of polarisation,
implying that ignoring the household size overestimates polarisation.
The comparison of trends in polarisation and income inequality shows
that generally the trends in inequality and polarisation are
similar
Provincial Finance Commission: Options for Fiscal Transfers
Get PDFThe Provincial Finance Commissions were constituted in all
four provinces of Pakistan in 2001. The Commissions were asked to
formulate a formula for the distribution of resources among the
districts in their respective province. The formula includes both
transfers- the development transfer and current transfers. The purposes
of the current transfers are to ensure the maintainability of existing
services at the districts level and of the development grants to
minimise the intradistrict poverty and inter-districts income
differential. In this paper we compute the Rank Correlation between the
existing development grants transfer index and the deprivation index.
This will help the policy-makers understood whether the transfers are
fiscal need based or not? That is to highlight to what extent the
existing development transfers are based on the existing level of
deprivation in the districts. If not, then what can be done to make the
transfers pro-poor. To assist the policy maker in this regards this
study carried out a simulation when 50 percent transfers are based on
population and 50 percent on deprivation. This simulation will provide
sufficient range in which the policy maker can exercise their discretion
to minimise poverty and at the same time provide resources to maintain
existing infrastructure. The distribution of funds among the districts
which is based only on expenditure needs of the districts cannot help
address poverty issue. The provinces therefore, have to use different
indicators in the formula of PFC Award to achieve both
objectives
Demographic Transition and Youth Employment in Pakistan
Get PDFThere is convincing evidence that Pakistan has entered the
demographic bonus phase; child dependency is declining and youth share
in the total population is rising. This paper has examined youth
employment in the context of demographic transition evidenced since the
early 1990s. Changes in the level of educational attainment have also
been analysed. The study has used the data from Pakistan Demographic
Surveys and Labour Force Surveys carried out between 1990 and 2005.
Findings of the study show that the benefits of demographic transition
in terms of rising share of youth in the total population has partially
been translated through development of their human capital and
productive absorption in the local labour market. While the pace of
human capital formation seems to be satisfactory in urban Pakistan, it
is dismal in rural areas, particularly for females. High levels of both
female inactivity across the education categories and unemployment for
males as well as females urge a strong youth employment policy in
Pakistan to reap the benefits of the ongoing demographic transition.
Youth are a source of development, and a high priority may be placed on
preparing them with the skills needed for their adjustment in the labour
market
Douglas A. Irvin (ed.). Free Trade under Fire. Princeton, NJ: Princeton University Press. 2005. 294 pages. Price not given.
Get PDFInternational trade around the world is growing rapidly and it
is very effective in improving the living standards of a nation, but
still free trade faces many critics. They complain that free trade
causes harmful economic adjustments, for example increase in
unemployment through the closing of factories etc. The critic further
object that the World Trade Organisation serves the interests of
international corporations, undercuts domestic environment regulations,
and erodes America’s sovereignty. Why has global trade become so
controversial? Does free trade deserve its bad reputations? These are
the questions which inspired the writer to work against these problems.
In “Free Trade under Fire”, the author discusses the misconceptions that
litter the debate over trade and gives the reader a clear understanding
of the issues involved. The aim of this book is to determine the effect
of economic, political and legal factors on the trade policy of the
United State
Attitudes Towards Civil Service of Pakistan: A Perception Survey
Get PDFThe Civil Service of Pakistan (CSP) is generally regarded as a
prestigious occupation offering numerous perks and benefits along with
administrative power and high social status. Each year, thousands of
applicants compete for a prized job in the civil service and only a
fraction eventually makes it.1 Yet in recent years there has been a
growing perception that the civil service might be losing its allure for
at least three reasons. First, the salary structure of the civil service
has not kept pace with the cost of living making it difficult for civil
servants to maintain a decent living standard. Second, there has been a
growing competition from the private sector which has created a variety
of professional jobs in manufacturing and services sectors offering
handsome salaries and other fringe benefits. Third, the civil service
has faced mounting criticism in recent years for its inefficiency, and
for its failure to modernise; and this may have spread a negative image
among the potential entrants.2 It is important to note that the Federal
Public Service Commission (FPSC) also laments the waning interest of
highly qualified students in the civil service. 3 Against this backdrop,
a survey was conducted to explore the students’ attitudes towards the
civil service of Pakistan.4 This study reports some key findings of that
survey. Section 2 provides some stylised facts about participants in the
CSS examination based on secondary data. Section 3 spells out the survey
methodology and highlights the key characteristics of the respondents.
Section 4 examines students’ occupation choice in terms of a comparison
between public and private sectors. Section 5 highlights student’s level
of awareness about various aspects of the competitive examination while
Section 6 explores students’ attitudes towards the civil service.5 Some
key findings of the survey are summarised in the concluding
section