TOKYO – Federal Minister for Finance and Economic Affairs Senator Ishaq Dar has said that the prospects for investment in Pakistan are bright.
During an interview with Japan’s leading economic journal Nikkei Asian Review” he said that the economic position of Pakistan was fairly unstable [prior to the 2013 general election]. That’s why many international institutions stopped working with Pakistan. But the political party headed by Prime Minister Nawaz Sharif – the Pakistan Muslim League-N – had a very clear road map of how to make an economic recovery. That was included in our manifesto.
We had four E’s: economy, energy, extremism, education and health. Soon after we took the oath of office in June 2013, we pursued very strong structural reforms to fix the economy. They’re always painful, but I’m glad to say that all of our macroeconomic indicators have shown very good performance. We project to attain GDP growth of 5 per cent this year, the third year 6 per cent and the fourth year 7 per cent. So our projected GDP growth is 7 per cent in the 2017 to 2018 fiscal year.
Asked that Pakistan last year made a splash in the bond market, the finance minister said that we took Pakistan back to the international bond market after seven years. We issued in April a conventional bond, a euro-dollar bond. It was heavily oversubscribed. We offered it for $500 million, and we got $7 billion [worth of orders]. By the way, we did not take $7 billion, we took only $2 billion. For sukuk – Islamic bonds – in November we went again to the international market and offered $500 million. We were offered $2.3 billion and we picked $1 billion.
Asked to comment on his interest to introduce Japanese technology for coal-fired power plants, he said that Pakistan have plans for something like a 10,000-megawatt addition in the electricity generation sector, because the supply-demand gap right now is around 4,000mw to 5,000mw. China has indicated that they are willing to finance coal-based generation. If Japanese companies would like to come, they are most welcome.
In reply to a question about security concerns of the investors, Dar said under the leadership of the prime minister, the government made a very clear public commitment that we will deal with security. He said that the Zarb-e-Azb operation is very successful, and it’s still on. It has eliminated the sanctuaries of the terrorists, it has destroyed their ammunition, it has killed almost 1,200 [militants, including] their high-profile leaders.
To a question about Pakistan and China economic corridor project, estimated to cost $45 billion Dar said that the economic corridor is not going to benefit Pakistan and China alone. It’s going to [bring] benefits to the entire region – to the Central Asian states, to India, to Afghanistan, to other neighboring countries. Even Japan won’t have to go to the Gulf to get things done if this economic corridor from Kashgar [in northwestern China] to Gwadar [in southwestern Pakistan] is activated. It’s a win-win for everybody. We are quite grateful for China’s support, which they announced. Now we are looking to Japan for an equal package, hopefully.
He said that Japan is an old friend. In Pakistan, we mostly see Japanese cars. Honda is there, Suzuki is there, Toyota, Hino. We are looking forward to the earliest possible visit by the Japanese prime minister to Pakistan. He said that the two countries have a history of bilateral economic and trade relations, and there’s a great scope to expand the ties further.