Pakistan is being known as a promising potential rising market. Pakistan offers a variety of chances for both investors and enterprises due to its young population, expanding middle class, and advantageous geographical location. However, there are certain difficulties involved in realising this promise. We will examine the elements that make Pakistan a desirable rising market, consider the difficulties it faces, and talk about the potential that lies ahead in this opinion piece.

The three main factors that have been contributing towards the rising of the market are:

1.Young Population

One of Pakistan’s greatest strengths is it young population. The nation has a sizable workforce that supports the economy's expansion and innovation, with a median age of about 23. A wide variety of consumer markets and a pool of skilled labor are provided by the demographic split. The young and hardworking population has been pursuing their full potential through entrepreneurship, educational advancement, and skill development in order to support market expansion. A professional freelance workforce has been developed thanks to government investments in expanding and improving opportunities, and 4G access has been provided to the freelancers to make it easier for them to access their foreign clients and jobs.

2.Growing Middle Class

The middle class in Pakistan is growing quickly, which boosts domestic consumption and generates a need for products and services. The demand for consumer goods, housing, healthcare, education, and entertainment increases as income levels grow. Businesses now have the chance to meet the demands and aspirations of this expanding middle class thanks to this increasing trend. In the four years between 2015 and 2016, Pakistan had a dramatic increase in private automobile ownership. In 2018, 9% or more of households had an automobile, up from 6% in 2015. According to Federal Bureau of Statistics (FBS) data recently released, the percentage of households owning motorcycles increased from 41% in 2015 to 53% in 2018. According to the 2017 Census, there are 32.2 million households in Pakistan. According to the 2017 Census, there are 32.2 million households in Pakistan. Retail sales growth, e-commerce, advertising revenue, mass media growth, sports and entertainment, and the negative effects of the consumer boom are all on the rise..

3.Strategic Geographic Location

Pakistan is geographically positioned strategically in the nexus of South Asia, Central Asia, and the Middle East. It is a convenient entry point to important regional markets, making it a desirable location for trade and investment. By connecting it to China's Belt and Road Initiative and giving it access to a sizable consumer market, the China-Pakistan Economic Corridor (CPEC) strengthens its position even more.

Pakistan has been a valuable ally to the US in its fight against terrorism due to its geographic location. However, the ongoing power struggle and China's emergence as a major economic force have transformed the unipolar world into a bipolar one. China became the top export market for a variety of goods in 2015 after surpassing the US in terms of crude oil imports.

There are a few setbacks and challenges that are faced by Pakistan while developing and enhancing its market. Some highlighted challenges are:

1.The infrastructure development

Pakistan has great potential, but infrastructure issues are preventing it from developing into a major market. The main infrastructure limitations are a lack of reliable power supply, poor transit systems, and restricted access to clean water. To resolve these problems, substantial funding from the government and infrastructure improvements in the areas of energy production, logistics, and connection are needed. According to the World Bank, Pakistan has the worst rate of infrastructure growth in the area. This year, the government will invest $2.4 billion in highways, power, and transportation. The investment comes on top of the billions of dollars already invested in projects by the World Bank, Asian Development Bank (ADB), Gulf Council nations, JICA, and the $56 billion China-Pakistan Economic Corridor (CPEC), which has drawn criticism for the heavy debt load it will impose.

2.Political and security concerns

Pakistan's commercial environment has been impacted by political and security issues. Regional conflicts, corruption, and other problems with government have occasionally made it difficult to make investment decisions. To allay these worries, the government has implemented initiatives to boost security, attract foreign investment, and improve governance.

3. Regulatory Framework

To create an atmosphere that is favorable for the business sector, the regulatory structure must be simplified. To draw and keep investors, it is essential to streamline procedures, improve transparency, and promote ease of doing business. Pakistan can establish an environment that promotes both domestic and foreign investment by enacting business-friendly policies and reforms.

The opportunities created for the growth in the market sector of Pakistan are:

1.Agriculture and Agribusiness

The agricultural sector in Pakistan offers numerous chances for expansion. The nation has the ability to dominate agriculture and agribusiness due to its fertile landmass and varied climate. The use of contemporary farming methods, value-added processing, and agricultural infrastructure can increase productivity, support food security, and generate income from exports.

2.Information Technology and Innovation

The information technology industry in Pakistan has grown significantly in recent years. A competent pool of IT workers and a thriving startup environment exist in the nation. The development of the IT sector can be sped up by stimulating entrepreneurship, promoting technological innovation, and investing in digital infrastructure. This will open up new job opportunities and draw in outside capital.

3. Energy and Infrastructure Projects

The infrastructure and energy sectors of Pakistan present promising investment opportunities. The landscape is changing as a result of initiatives like the CPEC, which are opening up new channels for connectivity and trade. Opportunities in transportation, urban planning, and renewable energy may boost economic growth, produce jobs, and enhance general quality of life.

Pakistan's young population, expanding middle class, and advantageous geographic location all contribute to the country's obvious potential as an emerging market. While difficulties including regulatory, political, and infrastructure development constraints result in setbacks. Pakistan may be able to achieve its highest level of economic growth if it continues to give the development of the market system more attention while utilizing all of its resources.

Nimra Durrani is an undergraduate student of BS Economics currently pursuing her degree in National Defence University Islamabad,Pakistan. Her areas of interest involve development of Pakistan economy and the United Nations.

References:

1. https://www.brecorder.com/news/561298/

2.https://www.southasiainvestor.com/2020/01/pakistans-middle-class-consumer.html

3.ps://dailytimes.com.pk/481707/pakistans-geographical-location-a-curse-or-a-blessing-in-disguise/

4.https://www.enr.com/articles/51571-pakistan-invests-in-infrastructure-but-many-obstacles-to-overcome

5.https://www.pbs.gov.pk/content/agriculture