MEASURES TO CORRECT THE BALANCE OF PAYMENT1. Proper Utilization of Resources :-
The less developed countries like Pakistan should utilize their natural resources properly. It will increase the production and exports of the country.
2. Increase in Labour Intensive Industries :-
Pakistan should prefer the Labour Intensive industries. Because labour is cheap as compared to the machinery. It can reduce the import of machines and can reduce the cost of production. The demand of cheap goods can increase.
3. Increase in Small Scale Industries :-
We should increase the small scale industries like Korea, Taiwan and Hong Kong. We can increase our production and exports with small capital. We can increase the exports of sports and carpets. Pakistan can not afford to import the heavy machinery.
4. Change in Export Pattern :-
Since Independence we are exporting raw material and few primary goods. Now if we want to correct our balance of payment we shall have to increase the ex[ports of manufactured goods.
5. Decrease in the Imports :-
The consumption goods may not be imported and people should use the local manufactured goods. People shall have to motivated to use Pakistani goods.
6. Denationalization :-
All the sick and nationalized industrialized industries should be handed over to the private sector to improve the production of the country. The private sector has the capacity to revived the sick units.
7. Improvement in Quality :-
We should improve the quality of the product to capture the world market by attracting the quality of the product.
8. reduce the Cost :-
For increasing exports it is necessary that we should reduce the cost of production. Because in the competition lower prices attract the other countries.
9. Joint Projects :-
We can increase the industries with the help of foreign investors. It will be useful for increasing the exports.
10. Reduction in Invisible Imports Services :-
We should reduce the expenditure on diplomats shipping to insurance to make our balance of payment favorable. Foreign fours and members of delegations should be curtailed.
11. Reduction in Export Duties :-
The government should reduce the export duties and should provide incentives to the exporters. It will increases the exports. Credit and License facility should be provided to exporters.
12. Revision in Import and Export Policy :-
The government should frame such type of import and export policy that if should encourage the exports and discourage the imports.
13. Devaluation Policy :-
Sometimes devaluation policy is also adopted to correct the balance of Payment. The delinking of dollar policy was also adopted to correct the balance of payment in Pakistan.
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