It is very strange that foreign donor agencies are taking interest in the mining sector of the country which has so failed to exploit huge mineral deposits in its soil. According to newspaper reports, the Asian Development Bank is going to offer Pakistan a roadmap to attract local and foreign investment in the mining sector. The bank is in a process to devise a small scale policy and provide advisory service to the federal government to develop mining sector in Balochistan. Earlier, the Reko Diq gold and copper mine hit snags due to dispute between the government and the company. At least $200 million were spent on the feasibility study of the project in 2010 to establish the basis for the development of the mine. The $3.3 billion project will have the estimated mine life of 56 years in which high-tech mining techniques were to be applied. The Reko Diq project is held in abeyance for the last five years.
The coal mine project is already in process with Chinese assistance and it is hoped the government will resolve the pressing issues of the country to create conducive environment for foreign investors. The government needs to revise its policy for foreign investment by minimizing the role of bureaucracy and red-tape to encourage business to business contacts with other economies. The foreign investors have various reservations which need to be removed. The removal of bottlenecks should not be through administrative order but legal process. The government should have to be proactive to introduce business friendly policies and improve the overall environment to attract local as well as the foreign investment. However, the financial sector of the country is already going through reform process and it is hoped the country’s image will improve as the capital market is showing better performance. The foreign investor are vary of law and order situation while complex tax system also needs to be improved. Experts opine the law and order as well as energy crisis are the areas of concern and hurdles in the economic development of the country.
The recent war hysteria by India is not only against business and investment in Pakistan, but also for its own economy. It is the time both the countries should negotiate the difficult problems and resolve them on the table rather in the war field. According to experts, the legal framework of the country lacks details about the licensing process and investors are not ready to face arbitrary, discretionary and regulatory decisions of the government. The government will also have to check environmental and social impact of foreign investment in the country.
