World Bank places Pakistan 48 positions ahead of India for Ease of Doing Business

[Valiant_Soul]

Here are the recent rankings:

Rankings - Doing Business - The World Bank Group

Pakistan comes in at 85 and India at 133.

Interestingly, in terms of the ability to enforce contracts, India registers at 182 of 183 total countries.

So is that why there is this huge difference in the amount of investments made in India and Pakistan by foreign companies?

India attracted FDI inflows of US$ 1.74 billion during November 2009, a 60 per cent increase over the US$ 1.08 billion achieved in same month last year. The cumulative amount of FDI inflows from August 1991 to December 2009 stood at US$ 127.46 billion, according to the latest data released by the Department of Industrial Policy and Promotion (DIPP). India attracted FDI equity inflows of US$ 1.54 billion during December 2009. On a cumulative basis, FDI equity inflows of US$ 20.92 billion were recorded during April-December 2009.

Foreign Direct Investment

Sources informed that the investment during the last fiscal year (2008-09) was $3.72b, while it was around $5.15b in 2007-08 and $5.14b in 2006-07. All these figures clearly indicate that FDI has been dipping for the last few years. According to SBP, FDI in Pakistan during the first quarter (July-Sept 2009) of fiscal year 2009-10 has declined by 29pc and stands at $463m as compared with the corresponding period of last fiscal 2008-09 when it was $1.12b.

FDI down by 29pc in three months | Pakistan | News | Newspaper | Daily | English | Online

 

[mjnaushad]

So is that why there is this huge difference in the amount of investments made in India and Pakistan by foreign companies?



Foreign Direct Investment



FDI down by 29pc in three months | Pakistan | News | Newspaper | Daily | English | Online

Peace. Soon WOT will end inshallah then we will be having a lot of investment coming in our country.

 

[Justin Joseph]

One second........ OMG.

It is troll thread by this ranking Pakistan is ahead of China also.

Yes... the great super power of all time China. The 3rd largest economy, 2nd largest exporter

But thread starter have shown his real intention by mentioning Ahead of India and not "India & China".

So sad, some people always want to provoke and troll

 

[desiman]

Stupid thread, why are you comparing with India. India does not allow any offshore business to walk in and exploit its own workers. Yes its not easy to set up in India because we follow our models of growth, which by the way have been very successful till now. Companies who want to invest have invested without any hassle. So stop with this illogical comparison please.

 

[Iggy]

The main reason why India is behind is most of the business sectors like insurance and banking didnt open much to foreign investors and most of them should have to start a joint venture with Indian companies..Some of the policies of the Indian government is mostly supporting the public sectors of Indias ..it has both good and bad sides

 

[Gin ka Pakistan]

India is still a closed economy , many sectors are protected by the government from imports. US want India to be a open economy for all its goods.

 

[karan.1970]

I dont know if the below was not included due to cherry picking approach or was left out due to oversight, but as you go thru the report in question(http://www.doingbusiness.org/documents/fullreport/2010/DB10-full-report.pdf), the following jumps out from the introduction:


Doing Business focuses on 10 topics, with the specific aim of measuring the regulation and red tape relevant to the life cycle of a domestic small to medium-size firm. Accordingly:

* Doing Business does not measure all aspects of the business environment that matter to firms or investors—or all factors that affect competitiveness. It does not, for example, measure security, macroeconomic stability, corruption, the labor skills of the population, the underlying strength of institutions or the quality of infrastructure. Nor does it focus on regulations specific to foreign investment.

* Doing Business does NOT assess the strength of the financial system or financial market regulations, both important factors in understanding some of the underlying causes of the global financial crisis.

* Doing Business does not cover all regulations, or all regulatory goals, in any economy.

Reviewing the Doing Business rankings in isolation may show unexpected results. Some economies may rank unexpectedly high on some indicators. And some economies that have had rapid growth or attracted a great deal of investment may rank lower than others that appear to be less dynamic.


Further this report mentions World Economic Forum and IMD's World competitiveness Yearbook as broader measure of economic environment in a country and below are the rankings for India and Pakistan

WEF
India 49/133
Pakistan 101/133

IMD Global Competitiveness Yearbook
India 30/57
Pakistan Not in Top 57

 

[Iggy]

India is still a closed economy , many sectors are protected by the government from imports. US want India to be a open economy for all its goods.

Its not a closed economy but it doesnt let foreign investors have a free run over some sectors like insurance and banking..it was a good move otherwise we would have seen these sectors fall just like US ones ..

 

[NWO]

What about a industrial revolution? When most of the western countries went through their revolution, most of their workers were also 'exploited' as well. This is because they have no other alternative. However, as time goes, the country has a higher standard of living and working conditions improve, usually because of unions.

Note that unions does not mean government. The government does not, and should not, get involved too much such as regulating and limiting foreign investors.

 

[TOPGUN]

Congrats to Pakistan and too bad for the haterz that always want to hate and cry..

 

[sab]

What about a industrial revolution? When most of the western countries went through their revolution, most of their workers were also 'exploited' as well. This is because they have no other alternative. However, as time goes, the country has a higher standard of living and working conditions improve, usually because of unions.

Note that unions does not mean government. The government does not, and should not, get involved too much such as regulating and limiting foreign investors.

Is it??? It was doing well before recent crisis. But after seeing some big financial institutions collaping, we need to think again. What if you have allowed an USA company in Insurance sector and it got bankrupt???

We need not to follow the West always. We have nothing in common with them. If we need to grow, we have to develop our own model. You must create your base before opening up your economy.

 

[TechLahore]

First of all, why would you compare Pakistan with India? I am literally tired of this immature and childish behavior.

Your rants are the only immature and childish behaviour I see here. I don't post here for your pleasure. So if you are "tired" of these posts Too friggin' bad. Tough. Deal with it. Or go to a different thread.

Pakistan is on 85th position, that means 84 countries are better than Pakistan. What is the healthy attitude? To compare yourself with those who are better, so you could improve, instead of comparing yourself with those who are not. I remember when I was in School, I would always compare my performance against those who would come on the first three positions not the ones who were at the bottom of the list.

What gave you the idea that this post makes the argument for not improving our country/position? What put me off is the completely negative emotional ranting that you responded with. Keep your holier than thou attitude to yourself.

Scondly, instead of ranking my post lowly (this is a recent childish phenomena on behalf of some pre-mature Think Tanks on this forum), you should have tried to put down a rebuttal. What wrong have you seen in my reply? Why you think its easy to do business in Pakistan but difficult in India? Because there is no accountability in Pakistan, the foreign investors come, invest, grab tons of money, and leave. The same company has manufacturing plants in Pakistan and India, yet, in India, the medicine is one third as cheaper as compared to Pakistan. What this means, that the company is making less profit in India and more in Pakistan; and why? Because they have cut shady deals with the GoP who does not care about the welfare of her people.

A rebuttal to WHAT? You didn't make a single point other than going off on a rant about why the comparison was being done in the first place. Go hold a little rally outside the World Bank HQ if you want an end to comparisons. I didn't compile the list.

As for you saying that the reason why India is ranked lower is because they've designed everything to benefit themselves whereas Pakistan has not, that is completely baseless. LOOK at the things being compared... do you think it is in the interest of the Indian people to not be able to have a contract enforced? Complete and utter nonsense.

Pakistan has free market policies which are the same as western countries. Are those countries inviting exploitation also? You can repatriate investments from Pakistan, just as you can from the US. You can be a foreign owner of a company in Pakistan, just like you can in the US. You get an 18 year tax holiday as a software company in Pakistan REGARDLESS of whether you are a foreign or locally owned concern. Contract enforcement is better than in our immediate neighbourhood. How is ANY of this against the interest of the Pakistani people?? If you believe in protectionist policies that force capital to be held hostage and not repatriated then you have no understanding of capital flows in the modern world and given your propensity to rants, I am not interested in educating you.

 

[desiman]

Your rants are the only immature and childish behaviour I see here. I don't post here for your pleasure. So if you are "tired" of these posts Too friggin' bad. Tough. Deal with it. Or go to a different thread.



What gave you the idea that this post makes the argument for not improving our country/position? What put me off is the completely negative emotional ranting that you responded with. Keep your holier than thou attitude to yourself.



A rebuttal to WHAT? You didn't make a single point other than going off on a rant about why the comparison was being done in the first place. Go hold a little rally outside the World Bank HQ if you want an end to comparisons. I didn't compile the list.

As for you saying that the reason why India is ranked lower is because they've designed everything to benefit themselves whereas Pakistan has not, that is completely baseless. LOOK at the things being compared... do you think it is in the interest of the Indian people to not be able to have a contract enforced? Complete and utter nonsense.

Pakistan has free market policies which are the same as western countries. Are those countries inviting exploitation also? You can repatriate investments from Pakistan, just as you can from the US. You can be a foreign owner of a company in Pakistan, just like you can in the US. You get an 18 year tax holiday as a software company in Pakistan REGARDLESS of whether you are a foreign or locally owned concern. Contract enforcement is better than in our immediate neighbourhood. How is ANY of this against the interest of the Pakistani people?? If you believe in protectionist policies that force capital to be held hostage and not repatriated then you have no understanding of capital flows in the modern world and given your propensity to rants, I am not interested in educating you.

there are just so many things wrong with your post that thr reply would be to long. Please go research taxation, contract, investment etc laws in India before you make assumptions. Just the amount of foreign companies in India is an answer to you questions. Actually its you who needs to understand how capital flows in an economy. Do not indulge in criticizing India even before you understand how the system works here brother.

 

[TechLahore]

there are just so many things wrong with your post that thr reply would be to long. Please go research taxation, contract, investment etc laws in India before you make assumptions. Just the amount of foreign companies in India is an answer to you questions. Actually its you who needs to understand how capital flows in an economy. Do not indulge in criticizing India even before you understand how the system works here brother.

What are you going on about? Where am I criticizing India? Did you even read my post? And if so, did you comprehend it?

 

[Awesome]

It is because when Indians get into business deals with the foreign investors, they make sure that the deal will result in the benefit of their country and their people. Whereas in Pakistan, such deals ONLY result in the benefit of the foreign investors and the few government officials involved in such deals.

That is not true. It takes into account the Process of establishing a new business through legal means.

The purpose of this study is to establish the difference between opening up a business through legal means and opening up a business through illegal means and see how much quicker it can be done.

So its obvious the LEGAL method of Pakistan and the LEGAL method of India were compared. Of course 85 is no good, and thats a different debate.