Foreign Aid & Public Investment in Pakistan


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Department of Economics, Federal Urdu University Arts, Science & Technology, Islamabad

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Foreign Aid & Public Investment in Pakistan

  1. 1. <ul><ul><ul><ul><ul><li> “ ALLAH” </li></ul></ul></ul></ul></ul>Start With The Name of
  2. 2. Foreign Aid & Public Investment Dept. of Economics, Federal Urdu University Arts, Science & Technology, Islamabad Presented By: Najeebullah & Tayyaba Kalsom
  3. 3. Public Investment Public investment Investment can be many things such as investment in machinery, buildings, facilities and computers. Operating expenditure on training, education and research is sometimes also regarded as investment. From the macroeconomic point of view, public investments are the key variable available to any government for supporting the development of economies, as it can invest in the sectors that have been given priority in its government plan for achieving development goals.
  4. 4. The Colours Types of Public investment (A ) Productive investment investment in transportation, education, industrial sector, on natural resources, energy etc. (B)Non productive investment defense expenditure etc. defense expenditure etc. defense expenditure etc. defense expenditure etc. defense expenditure etc.
  5. 5. Suggested chart formatting Sources of Public Investment <ul><li>There are many sources of public investment. </li></ul><ul><li>Taxes </li></ul><ul><li>Printing of Money/Deficit Financing </li></ul><ul><li>Export Surplus </li></ul><ul><li>Public Investment through Bonds & Equity financing </li></ul><ul><li>Remittances </li></ul><ul><li>Tourism </li></ul><ul><li>Internal Debt </li></ul><ul><li>Foreign Aid & Foreign Debt </li></ul>
  6. 6. Picture slide Foreign Aid The international transfer of public and private funds in the form of loans or grants from donor countries to recipient countries. Foreign Aid (also known as international aid, overseas aid) is a voluntary transfer of resources from one country to another, given at least partly with the objective of benefiting the recipient country.
  7. 7. Examples of suggested formatting styles Objective Of Our Study <ul><li>To see the effect of foreign aid on our economy. </li></ul><ul><li>on public investment both the productive and non productive public investment. </li></ul>
  8. 8. Use of templates Literature Review <ul><li>( Foreign Aid and the Public Sector: A Model of Fiscal Behavior in Pakistan - ZAFAR IQBAL) </li></ul><ul><li>In this paper, an attempt has been made to quantify the relationship between foreign capital inflows and government’s fiscal behavior in Pakistan. </li></ul><ul><li>This paper, however, overcomes the theoretical and methodological shortcomings of other exist in studies on this topic. The fiscal behavior model has been estimated by iterative three stage least squares technique for the period 1976–95. </li></ul>
  9. 9. <ul><li>  </li></ul>Literature Review <ul><li>(Foreign Aid, Investment, and Economic Growth in Kenya: Time Series Approach : By Daniel M’Amanja and Oliver Morrissey) </li></ul><ul><li>The case for Kenya analyzed in this paper was an attempt towards identifying some of these factors. Using a VAR approach, we found long run relationship representing the output equilibrium. </li></ul><ul><li>Output depends positively on private and government investment and imports, but negatively on net external loans. </li></ul>
  10. 10. Literature Review <ul><li>(The impact of foreign aid on public expenditure: The case of Kenya - By James Njeru, Moi University ) </li></ul><ul><li>  </li></ul><ul><li>Though foreign aid has continued to play an important role in developing countries, it is interesting to note that after half a century of channeling resources to the Third World, little development has taken place. </li></ul><ul><li>Although several externally financed projects and programs were initiated. </li></ul><ul><li>  </li></ul>
  11. 11. Literature Review <ul><li>(The effect of foreign aid on economic growth in developing countries - By E. M. Ekanayake and Dasha Chatrna ) </li></ul><ul><li>  </li></ul><ul><li>The major point emerging from this work is that foreign aid has a mixed impact on economic growth of developing countries. </li></ul><ul><li>When the model was estimated for different time periods, three out of four cases, indicating that foreign aid appears to have an adverse effect on economic growth in developing countries. </li></ul><ul><li>  </li></ul>
  12. 12. Literature Review <ul><li>(Impact of Foreign Aid on Economic Development in Pakistan [1960-2002] - By Ghulam Mohey-ud-din ) </li></ul><ul><li>Foreign aid, on positive side, has helped in boosting the GDP Growth, laid foundations of the industrial and agricultural sectors, policy advice and modern technology, assisted in overcoming the budget deficits and the BOP deficits and has also funded the projects for the social sector development projects. </li></ul><ul><li>But on the negative side, aid seemed to have substituted for domestic savings, increase debt burden. </li></ul><ul><li>  </li></ul>