The opposition parties from across the board have started a campaign to draw political mileage from the government mistakes ahead of the general elections. The country is facing threats from India, United States and Afghanistan on the external front and faces various challenges on the internal front. The economy is gradually going on the downward trajectory as trade deficits are piling up, foreign currency reserves are depleting and devaluation of the local currency has added insult to injury. However, the political forces, instead of coming on the same page to fight external and internal challenges are at warring path with one another. The victim of the internal strife is the economy. According to data released by the State Bank of Pakistan, foreign direct investment dropped by a whopping 71.5 percent in December, as the country received only $197.4 million during the month against $692.1 million during the same month of the last year. Keeping in view political chaos and unstable conditions, a majority of foreign investors has started following a policy of wait-and-see until the general elections are held and a new government assumes the office. The investors, who were building up trust in macroeconomic stability of the country, prefer to stay away from launching any mega investment project.
Some economists believe inconsistency in taxation policies, increase in cost of doing business and economic condition are not suitable for foreign investment. It is unfortunate that despite hiring highly qualified and experienced officials, the taxation system still faces challenges and desperately needs structural reforms. Vietnam, Malaysia and Bangladesh are increasingly becoming attractive destinations for foreign investments despite these countries have limited consumer markets as well as natural and human resources. Despite political polarization, it is good omen that the country still attracted some investment from the United States, United Kingdom, Hungary and China. As a matter of fact, there is no dearth of capital even within the country, but due to failure of policies it is allowed to fly to other countries. No one in the government circles bothered to understand why corrupt money of Pakistan is stashed in Swiss banks and invested in offshore companies. Once people are given opportunities, the white and black both kinds of capital will stay within the territories of Pakistan. A new wave of political agitation is setting in and it is yet to be seen how the government is able to protect not only life and property of the people, but also foreign investment in the country.
