Pakistan has been ranked 83rd in a global list of 'best countries to do business in', improving from 93rd place last year. While Pakistan has climbed 10 places, India is down 13 notches, to 64th place. In the new 'Forbes Study', that compares business climate from various angles in 121 countries, Denmark tops the list, having displaced last year's leader US, a private TV channel reported.
Ireland and Finland follow at No 2 and No 3 spots respectively. US is at No 4 now, followed by UK. The Forbes report, pointing out that Pakistan, "an impoverished and underdeveloped country", has suffered from decades of internal political disputes, low levels of foreign investment, and a costly, ongoing confrontation with neighbouring India.
However, since 2001, IMF-approved reforms--most notably privatisation of the banking sector--bolstered by generous foreign assistance and renewed access to global markets, have generated macroeconomic recovery.
Pakistan has experienced GDP growth in the 6-8 percent range in 2004-07, spurred by gains in the industrial and service sectors. Poverty levels have decreased by 10 percent since 2001, and Islamabad has steadily raised development spending in recent years, including a 52 percent real increase in the budget allocation for development in FY07. In 2007, the fiscal deficit--a result of chronically low tax collection and increased spending--exceeded the target of 4 percent of GDP.
Inflation remains the top concern among the public, jumping from 7.7 percent in 2007 to more than 11 percent during the first few months of 2008, primarily because of rising world commodity prices.
The rupee has depreciated since the proclamation of emergency rule in November 2007. For the 'study', the magazine said that it used expertise, research and published reports from the 'Heritage Foundation', 'World Economic Forum', World Bank, Transparency International, Freedom House, Deloitte Tax, the US Chamber of Commerce and Central Intelligence Agency and their vital analyses of various socio-economic indicators on the countries included.
To find the 'best countries to do business in', the magazine said, "We analyse business climates in each of more than 120 national economies, focusing on degrees of personal freedoms, like the right to participate in free and fair elections, or freedom of expression and organisation."
Investor protection examines the recourse held by minority shareholders in cases of corporate misdeeds, while corruption looks at the number and frequency of similar misuse of corporate assets for personal gain. Together with economic policies supportive of free trade and low inflation, these key points form a snapshot of countries' suitability for capital investment.