Bringing Pakistan’s ailing economy back on track is a gigantic task that will keep its civilian and military leadership on their toes.
The thrust of the efforts being made remains largely on economic diplomacy. Prime Minister Shahbaz Sharif’s government is struggling to convince foreign public and private investors to invest in Pakistan’s beleaguered but resilient economy, which is expected to grow by as much as three per cent even under the current challenging circumstances.
The establishment of the army-backed Special Investment Facilitation Council (SIFC) maintains that the government means business this time and is very seriously pursuing its one-point agenda of attracting foreign investment — be it through selling its stake in the multi-billion dollars gold mining projects like Reko Diq in the restive Balochistan province or a routine foreign direct investment.
The government has also sought bids from international investors to sell Pakistan International Airlines (PIA).
Pakistan needs to improve security by implementing intellectual property laws that protect foreign companies and attract international investors
Debt servicing has become the biggest drain on hard-earned revenues in Pakistan, a country where people tend to spend billions of rupees in charity every year but shy away from paying taxes.
It sounds like the persisting reliance of the nuclear-armed yet dollar-hungry Pakistan on foreign loans to keep its balance of payment in check is now heavily weighing on its sovereignty.
It has, therefore, become imperative for the world’s fifth most populous nation to try to stand on its own feet and earn more dollars than it spends.
For this to occur, the prime minister and his team will have to examine the country’s investment climate more thoroughly and remove the longstanding bottlenecks that keep foreign investors at bay.
If we look back at the past two decades, the flow of foreign investment into Pakistan has been far from encouraging. Foreign investors, both direct and portfolio, poured more than $8bn into Pakistan’s economy in the financial year 2006-07, which was depleted to a dismal $601 million last year in 2022-23. The worst was the year 2018-19 when the country saw a net outflow of $55m.
The government is trying to improve the security situation and create a one-window SIFC forum to facilitate investors, but it still lacks focus on the underlying but equally important issues, like the continued violation of foreign companies’ intellectual property rights (IPRs) in Pakistan.
Foreign investors, had thrown over $8bn into Pakistan’s economy in the FY07, which reduced to $601m last year in 2022-23
Such infringements inflicted a huge revenge loss of up to Rs 800bn upon the government last year alone, said the Overseas Investors Chamber of Commerce and Industry (OICCI) in its IPR Survey 2023. At the same time, the OICCI members lost 20 per cent of their turnover to these IPR violations.
The effective implementation of intellectual property rights in Pakistan is one of the biggest concerns of foreign investors who are under the banner of OICCI. Just last week, on April 29, OICCI launched its IPR manual, ‘Evolution of Intellectual Property Rights (IPR) in Pakistan: OICCI Perspective (Edition 2)’.
Intellectual property, it reads, is an all-inclusive term for intangible property, which is a product of human intellect.
To put it simply, intellectual property can be referred to as the creation of the mind or human ideas. An owner or creator of such a creation is afforded intellectual property rights by their creations.
It is not that Pakistan does not have any laws or organisational structure to take on the violators. Pakistan has legislated independent laws for patents, trademarks, industrial designs, copyrights, geographical indications, and plant breeders’ rights.
Also, Pakistan has signed various international agreements that aim to devise policies relating to intellectual property that can be enforced by each member country and ensure consistency and unanimity of the basic principles in corporations worldwide.
While there is general awareness relating to trade secrets in Pakistan, there are no specific laws to protect or enforce them. This is despite the fact that Pakistan has been consistently modernising its existing laws and enacting new ones in accordance with internationally accepted standards.
The cash-strapped country needs to reset its national priorities and effectively implement the existing laws.
One can aptly argue that Saudi Arabia or any other country would think a thousand times before sending their money and investors to Pakistan, where their intellectual property is secured.
The writer is social activist and communication analyst
Published in Dawn, The Business and Finance Weekly, May 6th, 2024
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