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September 2011 - Posts

  • Pakistan: a Developing Next 11 Economy

    What we typically learn about Pakistan in school likely involves their tenuous relationship with India. Indeed, conflicts between the two nations have simmered and erupted on occasion long before modern-day Pakistan was formed in 1947 following a split from the British Indian empire. Nonetheless, these conflicts have not prevented the Republic of Pakistan from distinguishing itself as an emerging economy among the Next 11 countries.

    A largely Islamic republic, Pakistan ranks in the top fifty among global economies and recorded a nominal gross domestic product of close to $175 billion in 2010. This represents a growth of two percent, yet shows that Pakistan has potential for stronger growth in the industrial sector in the future.

    Skyline of Karachi's Financial District

    Pakistan is known primarily for the following exported goods, the majority of which are distributed to top export partners in the United States, United Arab Emirates, and the United Kingdom:

    Textiles - Pakistan is one of the top producers of cotton in the world, and consequently the textile industry is one of their most important and profitable. Nearly forty percent of Pakistan's overall industry involves textiles and fabrics.

    Rice - Though rice is not the largest crop in the republic, it is one of the highest in demand among trade nations. Pakistan is especially known for its long-grained basmati rice and other aromatic grains.

    Leather - Tanned leathers and animal hides account on average for about $300 million in export sales for Pakistan.

    Carpeting - Many of the ornamental rugs and carpets coming from Pakistan are still hand-loomed, and nearly all of the rugs products in the country are exported around the world.

    Pakistan's exports in 2010 amounted to $20.29 billion increased from 18.33 billion in 2009. Main industries overall in Pakistan include the following:

    • Textile production and clothing manufacture (accounts for nearly 60% of exports)

    • Chemical production
    • Food processings
    • Transportation and automobile production
    • Telecommunications
    • Iron and steel
    • Paper products

    To maintain productivity as an emerging nation, Pakistan relies upon a number of imported products from their chief trading partners: China, Saudi Arabia, and the United Arab Emirates. Petroleum and byproducts for fueling cars and industrial plants, machinery for process and production, plastics, paper and tea rank among the more in-demand products that are not readily accessible domestically.

    As an emerging economy, Pakistan shows great promise alongside others in the Next 11 grouping. The clothes you buy, the rice you may cook from dinner, are likely to originate from this country. As conflicts are negotiated, one may hope to see friendlier trade ties formed with surrounding countries.