Ayesha Saba

Pakistan's economic transformation hinges on robust market regulatory reforms, which are crucial for creating an environment conducive to investment, competition and sustainable growth. Talking to WealthPK, Zeeshan Khan, Assistant Chief Industries & Commerce Section, Ministry of Planning, Development and Special Initiatives, said amid global economic shifts and domestic challenges, Pakistan stood at a critical juncture, where decisive action was imperative to unleash its full potential. He argues that without robust market regulatory frameworks in place, the country risks stagnation and missed development opportunities. "A strong regulatory system inspires confidence among investors. To attract capital and increase investment flows, Pakistan must address structural weaknesses and fiscal imbalances through a comprehensive approach." Zeeshan emphasised the urgency of reducing business costs and removing policy distortions to spur investment, competition and trade.

"Key areas that need to be targeted for reform include enhancing transparency, streamlining bureaucratic procedures, and fortifying legal frameworks to ensure a level playing field for businesses." "The country needs to focus on enhancing product diversification and opening its market further. This can be achieved by adopting certain administrative and legal reforms that considerably lessen the burden on businesses and help lower the costs of exogenous factors. The reforms aimed at promoting competitive and vibrant markets need to be initiated at the domestic commerce level at the earliest," he stressed. Talking to WealthPK, Majid Shabbir, a policy advisor at the Islamabad Chamber of Commerce and Industry, said, "In Pakistan, there is a high degree of government involvement in most markets ranging from agriculture to manufacturing, from retail to transport, and from trading to construction." He added that domestic competition was constrained by structural regulatory barriers to entry, market dominance by few firms, lack of effective competition policies, etc.

"It is very difficult for industries in Pakistan to operate due to the lengthy government regulatory framework, which leads to excessive paperwork, rent-seeking, high transaction costs, and trade barriers." "A significant barrier to business expansion and job creation is the cumbersome process of tax documentation and unpredictable tax changes. Many businesses opt to remain informal or resist corporatisation to evade these challenges," he noted, stressing the need for simplifying tax documentation procedures and ensuring stability in taxation policies. "Taxation should be simple, stable, and transparent to incentivise formalisation and corporate expansion." Shabbir advocates for developing free, open and competitive markets to bolster Pakistan's branding and global positioning. "By leveraging its unique strengths and fostering innovation and entrepreneurship, Pakistan can carve out a niche in international markets, attracting investment and driving economic growth."

Credit: INP-WealthPk