Wealth creation  

IT was in December 2018 that Prime Minister Imran Khan first talked about wealth creation as an imperative for poverty alleviation and then a year later in November 2019 he advised his economic team to make a new start by doing away with the mindset resisting the wealth creation but no tangible progress has been made towards that end.  On Wednesday, while addressing a select gathering of industrialists and traders in Faisalabad, he reiterated the resolve of the Government to promote industrialization in the country which will ultimately help create wealth and generate jobs, paving the way for getting rid of foreign debt.
There is no doubt that wealth creation is the sure way to progress and development as it accelerates the pace of economic growth and helps create job opportunities.  However, wealth creation needs a comprehensive strategy and it would be advisable to study how our great neighbour China succeeded in realizing this cherished goal. Since opening up to foreign trade and investment and implementing free-market reforms in 1979, China has been among the world’s fastest-growing economies with real annual gross domestic product (GDP) growth averaging 9.5%, a pace described by the World Bank as “the fastest sustained expansion by a major economy in history.”  Such growth has enabled China, on average, to double its GDP every eight years and helped raise an estimated 800 million people out of poverty.  Economists generally attribute much of China’s rapid economic growth to two main factors: large-scale capital investment (financed by large domestic savings and foreign investment) and rapid productivity growth. The question arises what we are doing to promote domestic savings and provide incentives to foreign investors. Some of the policies of the Government are anti-saving while foreign investors are shy of undertaking ventures in Pakistan due to a variety of factors including poor infrastructure, lack of ease of doing business, corruption, red-tape, ever-rising cost of production, political instability, absence of continuity of policies and law and order issues. The PTI Government has done well by offering a lucrative package to the construction industry that has started paying dividend as well as its initiative of ‘Roshan Digital Account’ aimed at motivating Overseas Pakistanis to save and invest. A well thought-out and coherent package is also needed for the industry besides expediting work on establishment of industrial estates especially those under the China-Pakistan Economic Corridor (CPEC). Other possible streams of wealth creation could be investment in human development, value addition, improvement in IT and telecom infrastructure and facilities and focus on research and development linking it intrinsically with the industry.