Department Of Law & Policy, SAHSOL
Principal Investigators: 
Professor Uzair Kayani

Project Context:

Professor Uzair Kayani’s project highlights the various ways to attract Foreign Direct Investment (FDI) in Pakistan. Previously, FDI levels in the coun-try have fallen from a high of 5,409 million dollars in 2008-2009 to 851.2 million in fiscal year 2014-2015. It is therefore pertinent for the long-term economic success of the country that these numbers pick up. Successive governments in Pakistan have made efforts to increase the level of Foreign Direct investment (FDI) flowing into the country. FDI is associated with a number of positive externalities such as are knowledge transfer, competition, privatization, and deregulation.


Proposed Solutions:

Dr. Uzair proposes the following solutions to bring about FDI inflows in Pakistan:

  • Bilateral Investment Treaties: Firstly, the signing of bilateral investment treaties between Pakistan and its largest FDI partners could be a step in the right direction
  • Targeting Incentives to Specific Investors: Secondly, special policies need to be formulated by the government that provide tax and in-vestment benefits to individual prospective investors. The government should engage in targeted promotions rather than general ones
  • Public-Private Partnerships in SEZ’s: Thirdly, setting up Special Economic Zones in collaboration with private parties could be a way for-ward as. SEZs provide a myriad of benefits to investors such as low or negligible tax liabilities, waving of import duties etc. The provincial governments can elicit interest from investors by offering such concessions
  • Islamic Finance Incentives: Lastly, the Islamic finance can also incentivize prospective investors as it deals with a different basket of securities as compared to the conventional finance industry. So, the availability of Islamic finance options may turn out to be a more se-cure means to attract FDI