Economy Of Pakistan Research Articles

Impact of Monetary Policy on Economic Growth in Pakistan Economy

Monetary policy aims to contribute to economic growth and stability in the economy. This policy also makes a balanced demand and supply by maintaining the domestic prices and exchange rate to decrease inflation, shapes the pattern of investment and production, and increases the financial institutions to manage the debt services very efficiently. The study analyzes how monetary policy affects inflation in a country. The Data sources are WDI and the State Bank of Pakistan from 1981 to 2014. The current study used Inflation rate as a dependent variable while independent variables of liquidity ratio, broad money supply and reserve ratio were used as independent variables. The study used ADF test to check the stationary of the variables used in the model. Data analysis was done by using the ARDL model. The findings highlight that monetary policy indicated by money supply shows a positive effect on the rate of inflation. Result also shows that the reserve ratio increases inflation in the economy. The study results suggest that monetary policy must provide a favorable atmosphere for investment by providing reasonable interest rates and liquidity management mechanisms.

Promises and perils of the China-Pakistan Economic Corridor: agriculture and export prospects in northern Pakistan

ABSTRACT The China-Pakistan Economic Corridor (CPEC) is a mega-project of primarily infrastructure-related loans and investments in Pakistan. Recently, the official discourse has increasingly shifted to the agricultural sector. For the region of Gilgit-Baltistan bordering China, academic and policy debates highlight the potential boost of fruit exports to China as the most promising opportunity to be leveraged through the CPEC. This paper scrutinizes these promises from a locally grounded perspective, investigating potential benefits and risks for local farmers. To make sense of the complex interplay between external and local actors, interests, markets and (infra)structures, the paper follows an assemblage-inspired approach to map out local trajectories. Contrary to the CPEC narrative, agricultural exports from Gilgit-Baltistan recently came to a halt, due to increasing trade barriers and seemingly competing agricultural developments in neighboring Xinjiang, China. Moreover, the economically most promising local crop for export to China, namely cherries, does not seem too promising for the majority of small farmers. There are other commodities with export potential, but overall, prospects appear to be limited. There is a need for a deeper engagement with the inherent complexities of CPEC trajectories, particularly in regards to local farming contexts in Pakistan and relevant developments in China.

A statistical evaluation of Earth-observation-based composite drought indices for a localized assessment of agricultural drought in Pakistan

Drought is a complex phenomenon that impacts a multitude of sectors globally and is difficult to characterize due to the variation in defining conditions. With over 2.5 billion people dependent on agriculture for their livelihoods, agricultural drought impacts are particularly acute. Specific indicators based on different aspects of the hydrologic cycle can be used to better characterize drought and mitigate its impacts. The overall objective of this study is to develop a monthly Composite Drought Index (CDI) using Earth observation datasets to provide an assessment of droughts in Pakistan. Further, district level wheat production data was used to optimize variables to create a customized composite drought index (CCDI) specifically for agriculture and evaluate the two indices. Pakistans economy and communities rely heavily on the agricultural sector and many areas are at high risk of crop failure due to the dependence on precipitation and other environmental conditions. A total of 10 environmental variables are considered that account for supply and demand of water, soil moisture, and vegetative conditions. Statistically important variables are chosen for each district with respect to wheat production, creating a subset of the original inputs. Weights for each dataset are calculated using a Principal Component Analysis (PCA), identifying what variables contribute the most to the index. The CDI and CCDI are evaluated with nationally reported, district level, wheat production data, for the harvest years 2005–2017, carried out specifically for the Rabi season, October - March. The CCDI, on average used 5 variables, as compared to the full 10 in the CDI. Overall, the two composite indices were highly correlated and both captured well known climatological events. When compared to production trends, the CDI has the ability to identify agricultural droughts with a true negative rate of 0.742 in rainfed districts, while irrigated districts have a true negative rate of 0.568. For the CCDI the true negative rates in rainfed and irrigated districts were 0.667 and 0.602, respectively. The results distinguished the importance of each variable in the contribution to the CDI and CCDI. The findings from this study demonstrate the potential of using the methodology for the CDI to enhance pre-existing drought monitoring and forecasting systems in the region.

The Shadow Economy in Pakistan: An Analysis with MIMIC Model

This paper explicitly presents the estimation of the size and development of the shadow economy. The study examines the impact of multiple exogenous causes (observed variables) on the shadow economy (latent variable) and the size of the shadow economy influencing the performance of multiple macroeconomic indicators. In order to accomplish this econometric analysis, a MIMIC Model (Multiple Indicators Multiple Causes Model) is applied over the period 2011 to 2021. The results indicate that the tax burden, business freedom, unemployment rate, and Gross Domestic Product are the key driving forces of the shadow economy in Pakistan. The findings are potentially beneficial for the policymakers in identifying and dealing with the shadow economic activities as well as developing the strategies relevant to the economic policy.

English

Cotton is an important commodity to improve economic development of rural dwellers and the economy of Pakistan. It contributes 5.2 percent in value addition to the agriculture sector and more than 50 percent share of the total exports of the country. But the cotton production has witnessed a huge decline of 20 percent from 13.96 million bales to 9.86 million bales over the last five years from 2014-18, resulting in a large loss to the GDP of the country. This rapid shifting of cotton towards sugarcane and other crops in core cotton areas of Punjab has severely damaged the large textile industry of Pakistan. Therefore, the present study was planned to investigate the factors behind shifting of cotton crop in the purposively selected district Rahim Yar Khan as it was the leading cotton producing district in the Punjab and had been hit hard by this paradigm shift. The population of study was comprised of all those farmers who have been completely or partially shifted from cotton to sugarcane crop. Multistage sampling technique was adopted to select the sample size. A baseline survey was conducted to prepare a list of farmers who had been shifted from cotton to sugarcane production. A well-prepared interview schedule was administered for data collection in this study. It was revealed that the cost of certified cotton seed and fertilizers were the major economic factors; adulteration of pesticides and unavailability of certified seed were the production factors; poor quality of water and extreme heat waves were the natural factors; market fluctuation and middleman monopoly were the marketing factors and expansion of sugar industry and unchecked involvement of middleman were the major policy factors behind the paradigm shift of cotton crop as per the responses obtained from the respondents

SYMMETRIC IMPACT OF EXCHANGE RATE VOLATILITY ON FOREIGN DIRECT INVESTMENT IN PAKISTAN: DO THE GLOBAL FINANCIAL CRISES AND POLITICAL REGIMES MATTER?

Understanding currency fluctuations carries a high level of risk. A currency can slide or spike as a response of an economic indicators revelation or an unexpected political event, both of which are unforeseeable. As foreign investors become more optimistic about the country’s future, a healthier economy usually requires a strong currency. Therefore, it is necessary to assess the exchange rate volatility risk in the context of direct investment in order to develop preventive policy routes that would encourage foreign investors into the country. To this purpose, the autoregressive distributive least square (ARDL) technique has been employed to investigate the symmetric effect of exchange rate volatility on foreign direct investment (FDI) during global financial crises and political regimes from January 2000 to December 2018. In order to eliminate arbitrariness, the study uses the most accredited estimate of volatility, GARCH (1 1), as part of the re-estimation process. Besides this, the interaction has been studied under various regimes to see how the political environment affects foreign market participants’ expectations for future gains. The findings suggest that exchange rate volatility is adversely related to FDI and is a source of decreased net foreign investment in Pakistan. It also illustrates that during times of crises and apolitical regimes, Pakistan’s average FDI falls dramatically. The findings are extended to the context of Pakistan that has seen significant rupee volatility for the past few years. Our study recommends that policymakers should pursue exchange rate measures that promote exchange rate stability, which might assist to minimize risk of exchange rate volatility and so attract higher FDI. It is also crucial to formulate more sustainable investment methods that allow for efficient capital allocation during times of economic uncertainty.

Geostrategic Imperatives for Pakistan of Gwadar Port

The geographical environment is believed to be one of the most important elements influencing the expansion of human civilizations along watercourses. The contiguity of Gwadar Port to the dominant trading routes and energy chokepoints of the world contributes to its prominence in the regional framework. Gwadar will turn Pakistan into a regional corridor due to its geographic location in relation to the enormous supply and consumer market economies of different regions. This study is explanatory and qualitative, and it emphasizes the geostrategic imperatives driving the development of Gwadar Port, including those connected with Pakistan’s economy and its position in the region, military strategy, and the development of Baluchistan Province, and concludes that the opening of the port has substantially enhanced the economy and security of Pakistan.

Green Spillover: Deriving Pro-environmental Behavior on job and Off-job through Environmental Specific Servant Leadership

The study was conducted to explore the role of environmental specific servant leadership to promote on-job and off-job pro-environmental behavior. Additionally, the study attempted to unfurl the mediating role of environmental passion linking environmental specific servant leadership to on job and off-job pro-environmental behavior. The study finally obtained data from 296 respondents who were employed in the service sector of Pakistan. The data analysis was carried out using PLS-smart and SPSS. Specifically, multiple regression and hierarchical regression were used to test the proposed structural model. The study found that environmental specific leadership is related to employees’ environmental passion, on-job, and off-job pro-environmental behavior. Furthermore, environmental passion was found to mediate the relationship between environmental specific servant leadership and on-job and off-job pro-environmental behavior of the employees. This is the first study that examined the relationship between environmental specific servant leadership on on-job and off-job pro-environmental behavior jointly. Additionally, it is the first study that established the mediating role of environmental passion between environmental specific servant leadership with both the pro-environmental behaviors.
 
 Keywords – Environment specific servant leadership, Environmental Passion, Pro-environmental behavior, pro-environmental work behavior

Identification of tick species infesting livestock in Dera Ismail Khan Pakistan

Ticks are blood-feeding obligate ectoparasites that belong to order Arachnida with three main families (Ixodidae, Argasidae, and Nuttalleillidae). Ticks transmit viral, bacterial, and zoonotic diseases in humans, and animals (wild and domestic). Ticks directly and indirectly affect the livestock industry which plays an important role in the rural economy of Pakistan. These are the main source of income and a source of food for poor people. The current study was conducted to identify the tick species infesting livestock in Dera Ismail Khan Pakistan. For this purpose, different farms were randomly visited and 130 ticks were collected from 200 scanned animals. The collected ticks were identified to species level using morphological keys. In the current study, four tick species were identified as Rhipicephalus sanguineus, Hyalomma marginatum, Hyalomma anatolicum, and Dermacentor marginatus were identified. The most dominant species were Hy. anatolicum (35.39%) followed by R. sanguineus (30.00%), Hy. marginatum (23.85%) and D. marginatus (10.77%). Hy. anatolicum was the predominant tick species and accounted for 35.39% of the ticks. Tick infestation was highest in buffaloes followed by cows, sheep, and goats. Tail and ear were the most preferable sites for tick infestation than other body parts.

Exploring the Role of Agile Operant Resources in the Facilitation of Strategic Orientation: The Case of Family-owned Businesses in Pakistan

Purpose: No one can deny the pertinent role of resources in each era. Over time, its usefulness enhances, which facilitates firm sustainability in today’s volatile business world. To the best of the author’s knowledge, no study has been done specifically in the context of Family-Owned Businesses (FOBs) in Pakistan regarding the owner’s ability to possess agile operant resources. The purpose of this study is to explore the hidden agile operant resources of the family business owners which facilitate FOBs in strategic orientation. Design/Methodology/Approach: This study resides in a relativistic school of thought based on the interpretive paradigm. It is used as an exemplar of the nature of research. Purposive sampling is used for data collection. Interviews were conducted through open-ended questionnaires and observation of family owners. This study is based on the abductive research approach, which along with Gioia methodology, has been used to develop broader themes for discussion. Findings: This research article provides sound conceptual insights on the strategic orientation of family firms through the pertinent role of learning and observational resources, agile entrepreneurial phronesis and agile sensing skills. The authors proposed a conceptual model for shedding light on the pertinent role of agile operant resource supports to facilitate the strategic orientation of FOBs. Practical implications: This study proposes a framework for FOBs operating in Pakistan by providing novel insights for establishing sustainable firm performance by indicating the pertinence of agile operant resources. FOBs may adopt these agile operant resources to ensure firm strategic orientation in today’s dynamic business world. It also opens new avenues of innovation and growth for FOBs by determining the primitive, significant role of individual FOB owners operant resources. This study can apply to all FOBs. Originality value: In this research, the authors have discussed the iterative themes interactions and their significant role in the context of family firms to understand how learning and observational resources, agile sensing skills and agile entrepreneurial phronesis strengthen firm strategic orientation that drives firm sustainable performance in today’s competitive business world. As Pakistan, like other Asian countries, is considered fertile land for family businesses, such studies can enrich insights through surfacing the FOB owner-possessed resources-based framework and how it supports catering to effective strategic orientation.

An Exploratory Analysis of the Role of Higher Educationin Developing Knowledge Economy in Pakistan

Knowledge is the key for growth and development of any country. Historically, only those countries succeeded and advanced which based their economies on knowledge. Higher education authorities in Pakistan are trying to promote the notion of knowledge economy in the country. This paper provides an exploratory analysis of various factors and indicators which disclose relationship between the higher education products and economic indicators of the country. There are four main pillars of knowledge economy i.e. education and training, information infrastructure, economic incentive &institutional regime, and innovation systems. Progress on different economic indicators is analyzed and concluded that investment in higher education is not supporting a shift in the nature of economy in Pakistan. Spontaneous and temporary steps may further deteriorate the situation. The paper urges on an overall restructuring of higher education policy and procedure of its implementation in contemporary economic and financial scenario of the country and globe.

Commodity Market Prices and Its Impact on Exchange Rate of Pakistan

Pakistan’s economy and exchange rate has experienced many ups and downs in the last ten years. The exchange rate has depreciated from Rs.59/$ to Rs.104/$. This is causing a massive dent to Pakistan economy. According to the State Bank of Pakistan, Pakistan is consistently facing a current account deficit for the last several years and a depreciated currency is one of the main reasons for the deficit. This study analyzes the relationship between the commodity market prices and exchange rates in Pakistan both in long and in short run. This research utilized the monthly data for the past ten years from Jan-2006 to Dec-2015. The results are quite surprising because in Pakistan, none of the prices of the commodities (i-e oil and gold) have short term relationship with the exchange rate of Pakistan. This study also does not find any long-term relationship among the variables.

Economic outlook of food crops in Pakistan: An empirical study

Agriculture is the backbone of Pakistan's economy, highly depends on food crops. There is a huge gap between the products purchased and the actual products, which suffer from inadequate technology, inadequate resource use, inappropriate use of water and land, and inappropriate pests management studies, it's not just negatively affects production but also reduces production. Most farmers use synthetic chemicals to control pests, but they are often used in vain. In order to illustrate the main gaps and actual results of the main upland crops. The study examines the link between food security and GDP growth in Pakistan, including wheat, rice, sugarcane and maize, and water availability in Pakistan from 1999 to 2018. Periodic data are collected from the Pakistan Economic Survey (various sources). Use conventional miniature methods and refine Dickey-Fuller (ADF) testing to analyze crop data, and use Johansen aggregation testing to interpret results. Our research found that wheat, rice, sugarcane, and maize yields were positively correlated with Pakistan's agricultural GDP, while water supply was negatively correlated with Pakistan's agricultural GDP without significant correlation. Water resources related to climate change and the context of climate change will have a devastating effect on Pakistan's water resources. Therefore, the study suggests that the Pakistani government should provide major agricultural inputs on subsidies formulate policies, and launch new funding programs to develop and improve water availability.

The Effect of Total Quality Management on Service Quality in the Context of Services Based Small and Medium Enterprises of Pakistan

Pakistani economy is making a transition from strong manufacturing base to the services and in this scenario, service based small and medium enterprises (SMEs) are playing a major role. In current study, we focus on total quality management (TQM) which has the potential to enable the service based SMEs to improve their competitiveness in current highly dynamic environment. The objective of the study was to assess the current level of TQM implementation and its effects on the service quality in the context of service based SMEs of Pakistan. A survey was designed to collect primary data and the measures for TQM and service quality were adapted from previous sources. The study utilized quantitative approach and through stratified random sampling, data is collected from 135 participants belonged to the management of SMEs located in three cities of Pakistan. Our findings indicate that the dimensions of TQM including top management commitment, customer focus, people management, supplier quality management, continuous improvement, and the process management are only moderately followed by the Pakistani service based SMEs. In terms of effects, three out of six TQM dimensions are having positive and significant effects on the service quality and together these TQM dimensions explain up to 60.7% change in the dependent variable of service quality. Based on the findings, we recommend that service based SMEs should give more attention to the TQM implementation

A Brief Overview for the Development of Herbicide-Resistant Sugarcane Transformation Approaches


 Weeds are the undesirable and unwanted plants in the wrong place in a situation that can significantly decrease the yield of desirable plant such as sugarcane. One solution to tackle this problem is the development of herbicide resistant crops like sugar cane that are highly resistant to several herbicides or broad-spectrum herbicides which is done in most cases by genetic transformation, site-directed mutagenesis, and plant breeding. Sugarcane (Saccharum officinarum) is the 2nd vital cash crop of Pakistan, placed at 6th position in world cane acreage and 15th in sugar production. Hence, sugarcane occupies a crucial position in the economy of Pakistan and acts like a backbone in economic development of country. There are several reasons for the lower sugarcane yield in Pakistan but the most important is the large number of weeds that covered most of the area of sugarcane cultivated fields which results in major loss of sugarcane yield in terms of quality and quantity. Broad spectrum herbicide resistant plants are produced to tackle this issue by the insertion of CP4 EPSPS (Glyphosate tolerant gene; 5-enolpyruvulshikimate-3-phosphate synthase from Agrobacterium tumefaciens strain CP4) into sugarcane which provides them the ability to survive after the spray of glyphosate but weeds do not survive in this condition. The most common herbicide resistant technology is Glyphosate resistant technology which gives broad-spectrum weed control feasibility along with the flexibility in the application time of herbicide. There are numerous methods of transformation which are available now-a-days for insertion of foreign DNA into plant cells like Agrobacterium-mediated transformation, micro-projectile bombardment (gene gun) and protoplast transformation. Glyphosate tolerant gene expression is showed by three sugarcane cultivars (CPF-213, SPF-234 and HSF-240). Transgenic sugarcane plants showed these expressions are most stable against herbicide to control weeds. Several farmers in many countries have rapidly and extensively utilized herbicide-tolerant crops due to low production and labour costs, huge profit, increased weed control and many environmental benefits.

Affordability and Work-Family Balance as key Predictors of Favorable Attitude towards Online Businesses in Women E-Entrepreneurs of Pakistan

The study assessed the role of factors, affordability and work family balance, in shaping favorable attitude of women Facebook e-entrepreneurs towards online businesses in Pakistan after controlling for socio-demographic, household, and business characteristics. Data from a nonrandom sample of 112 women e-entrepreneurs operating their online businesses through Facebook was analyzed. The independent variables were affordability and work life balance and the dependent variable was favorable attitude towards online businesses. Data was analyzed using SPSS. Factor analysis and reliability analysis was done to assess validity and reliability of the scales used in the study. Hierarchical multiple regression was carried out to assess the effect of independent variables on dependent variable. The study found that affordability/low startup cost of business and work life balance were statistically significant determinants of favorable attitude towards online businesses. All control variables added in the model were statistically insignificant. The study recommends that interventions such as providing e-entrepreneurship trainings to vulnerable segments of women population can increase their empowerment. The study also suggests that action based studies should be carried out to assess the effect of e-entrepreneurship on women empowerment.

RETRACTED ARTICLE: Nexus between sustainable economic growth and foreign private investment: evidence from emerging and developed economies

We, the Editors and Publisher of the Journal of Sustainable Finance and Investment, have retracted the following article: Nexus between sustainable economic growth and foreign private investment: evidence from emerging and developed economies, DOI: 10.1080/20430795.2021.1990834 Subsequent to publication it has been determined that the article contains significant textual overlap with: Nexus between economic growth and foreign private investment: Evidence from Pakistan economy, DOI: 10.1080/23322039.2021.1956067 which was not cited or otherwise acknowledged. When approached for an explanation the following authors reported that they contributed to the article at the revision stage and were unaware of the overlap with the previously published article: Muhammad Safdar Sial, Jacob Cherian, Susana Alvarez-Otero, Ubaldo Comite, Stefan Gunnlaugsson, and Mosab Tabash. We have been informed in our decision-making by our policy on publishing ethics and integrity and the COPE guidelines on retractions. The retracted article will remain online to maintain the scholarly record, but it will be digitally watermarked on each page as ‘Retracted’.

A strategic entrepreneurship framework for an emerging economy: reconciling dynamic capabilities and entrepreneurial orientation

Purpose This study aims to use dynamic capability theory to investigate the effect of entrepreneurial orientation and dynamic capabilities (DC) on the firm’s entrepreneurial performance through strategic entrepreneurship (SE). Design/methodology/approach To address the research objective, the authors obtained data from larger organisations operating in an emerging Pakistani economy. Findings Findings reveal that, in emerging markets, DC are essential elements that influence the organisation’s opportunity-seeking and advantage-seeking behaviours to ensure the firm’s entrepreneurial performance. Research limitations/implications The present study implies that training is needed for the managers and team leaders of emerging market corporates to think entrepreneurially by revising the strategic goals of the corporate. Practical implications SE-based executive training should also be compulsory for the top management teams, including the board of directors for larger firms. Social implications SE is a critically important business concept and should be taught in the emerging market’s business schools as a course at the graduate level. Originality/value This paper strengthens entrepreneurship literature by using a unique context of an emerging market and suggests a unique SE-based framework for the firms operating in emerging markets.

Revisiting US–China strategic competition in Central Asia and its impact on Pakistan

Since the dissolution of the former Soviet Union, the US, and China are aspiring to enhance their strategic influence in Central Asia which has recently been intensified due to China's Belt and Road Initiative (BRI). Further, China has also increased its influence in Central Asia through regional organizations such as Shanghai Cooperation Organization (SCO). Against this backdrop, Pakistan emerged as an important pivot of China's BRI where the China–Pakistan Economic Corridor (CPEC) is the flagship project. This study begins with a theoretical debate of Heartland theory of Halford John Mackinder and the later version of Heartland theory into Rimland theory by Nicolas Spykman, which explains the geopolitical significance of Central Asia for Major Powers. Within this theoretical context, the study discusses China and the US grand strategies in Central Asia in the form of China's BRI, SCO and the US counter‐strategies such as from phase 1.0, policy to 2.0, policy, and the recent initiative of C5 + 1. The study finds out that US–China strategic competition will have implications for various states having relations with both of these two major powers. In case of Pakistan, the strategic competition between China and the US will affect various dimensions of Pakistan's security at the broader level such as political, military, and economic security. First, at the political level, it is affecting Pakistan's relations with Russia, China, Iran, and Gulf States. Second, at military level, Pakistan's strategic value has been enhanced as a frontline state against terrorism. Finally, at the economic level, CPEC provides opportunities for Pakistan's economy and regional connectivity.

Flood Hazard Mapping of Rivers in Snow- and Glacier-Fed Basins of Different Hydrological Regimes Using a Hydrodynamic Model under RCP Scenarios

The global warming trends have accelerated snow and glacier melt in mountainous river basins, which has increased the probability of glacial outburst flooding. Recurrent flood events are a challenge for the developing economy of Pakistan in terms of damage to infrastructure and loss of lives. Flood hazard maps can be used for future flood damage assessment, preparedness, and mitigation. The current study focused on the assessment and mapping of flood-prone areas in small settlements of the major snow- and glacier-fed river basins situated in Hindukush–Karakoram–Himalaya (HKH) under future climate scenarios. The Hydrologic Engineering Center-River Analysis System (HEC-RAS) model was used for flood simulation and mapping. The ALOS 12.5 m Digital Elevation Model (DEM) was used to extract river geometry, and the flows generated in these river basins using RCP scenarios were used as the inflow boundary condition. Severe flooding would inundate an area of ~66%, ~86%, ~37% (under mid-21st century), and an area of ~72%, ~93%, ~59% (under late 21st century RCP 8.5 scenario) in the Chitral, Hunza, and Astore river basins, respectively. There is an urgent need to develop a robust flood mitigation plan for the frequent floods occurring in northern Pakistan.