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Wednesday, 20 July 2011

Discuss the various measures adopted by the government to promote the industrial development in the country?

The government of Pakistan has taken various steps to promote industrial growth in the country. In 1948 the government declared the private sector for investment. Following are the important measures adopted by the government to promote the industrial sector :

1. Establishment of Financial Institutions :-
In 1953 industrial development corporation (PIDC) and in 1961 industrial development bank was established to improve the industrial sector. In 1975 Pakistan industrial credit and investment corporation (PICIC) was set up. National investment trust (NIT) was also set up in 1962 for this purpose.

2. Denationalization :-
To encourage the private sector government has denationalized the various industries like cotton, ginning, rice husking and flour milling to improve the industrial sector.

3. Selling of Public Industries Shares :-
The government of Pakistan has also decided to sell the shares of public units to encourage the private investment. In this regard national disinvestment authority has been set up. Wapda, PIA, shares are sold. Privatization policy is adopted by the present government to encourage private sector.

4. Export Finance Scope :-
The scope of export finance has been expanded by reducing the interest rate on the items included in the scheme.

5. Exemption for Pakistanis :-
The government has allowed the Pakistanis working abroad to import the machinery without custom duty up-to Rs. 10 million. various types of shares investment vouchers are offered to them for investment.

6. Establishment of Technical Institutions :-
To promote industrial development the government has established Engineering Universities, Engineering Colleges, Polytechnics Institutions, Commerce Colleges and Vocational Institutions. These will produce the technocrats for industrial sector.

7. Industrial Estates :-
The government of Pakistan has set up the industrial estate in the important cities and provided the various facilities like roads, transport and banks to them. This step has increased the number of firms and factories.

8. Protection to Domestic Industries :-
To protect the domestic industries from foreign competition government restricted the imports. In 1986, a tariff commission was set up to provide the various incentives to the industries.

9. Export Processing Zones :-
In 1980 government decided to set three export processing zones at Karachi, Lahore and Peshawar to improve the industrial sector.

10. Development of Small Scale Industry :-
Provincial small scale industrial corporations provide technical assistance to the small industries. Govt. is paying proper attention to this sector. Small loans are issued by the commercial banks.

11. Research Institutions :-
The government has established the various research institutes to increase the industrial growth. These are following :
1. Pakistan Council of Scientific and Industrial Research.
2. Pakistan Industrial Technical Assistance Center.
3. Central Testing Laboratories,
4. Pakistan Industrial Advisory Center.

12. Use of Black Money :-
The government of Pakistan issued three types of special bonds to died the black money. This policy remained fruitful up-to some extent. This amount was used for the productive purpose.

13. Incentive for Foreign Investors :-
To attract the foreign investors various incentives has been given to the foreigners. In this regard government has provided full security to the foreigners.

14. Private Investment Sanctions :-
There was no need of government sanctions up-to rupees seventy crore investment. It encouraged the rate of investment in the country.

15. Permission for Private Banks :-
For the development of industrial sector government is also considering the establishment of private banks. Mehran Bank, Bank Al-Habib etc are working in private sector.

16. Changes in Income Tax System :-
The government of Pakistan has also changed the income tax system to encourage the industrial sector.

17. Tax Holiday :-
In the 7th five year plan all the country was announced a tax free zone for four years to increase the new industries. In the backward areas the tax holiday period is for eight years. During 2000-2001 new incentives were given.

18. Private Companies and Banks :-
Government of Pakistan has allowed the private sector to establish the private investment companies. This step of the government has encouraged the industrial sector. Now private banks are playing very effective role in the country.

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