South Asia Investor Review

Until 2010, Bangladesh was a laggard in South Asia region. Its per capita income was about half of Pakistan's. Now Bangladesh has surpassed Pakistan as the Pakistani economy has suffered significant slow-down from the previous decade. In fact, the Pakistan economy grew at the slowest rate in South Asia as reflected in per capita incomes. However, the income inequality in Pakistan continues to be the lowest in South Asia.  Per Capita Income Growth in Pakistan Lags in South Asia. Source: World Bank Lower income inequality in Pakistan is reflected in its abysmal domestic savings and investment rate of  around 10% of GDP . It shows in Pakistan's lower economic growth rate compared to Bangladesh and India. The distribution of national income in a country is a key socioeconomic variable with broad economic and societal implications. Income inequality and wealth inequality are related because the flow of income determines savings and investments, which in turn determine GDP grow...

About 20 million Pakistanis are expected to enter the labor market over the next 10 years. Can Pakistani economy add jobs at a rate of 2 million a year for the next decade to absorb all new entrants to its work force? What is Pakistan's employment elasticity? How fast must it grow to create these jobs? How much investment is needed to achieve the required growth rate? Pakistan Labor Market: Pakistan's work force is about 68 million, according to the World Bank . Its  labor force expansion  is the 3rd biggest in the world after India's and Nigeria's, according to  UN World Population Prospects 2017 .   Pakistan's working age population  in 15-64 years age bracket is expected to increase by 27.5 million people to 147.1 million in 10 years, according to  Bloomberg News' analysis  of data reported in UN World Population Prospects 2017.  Pakistan's increase of 27.5 million is the third largest after India's 115.9 million and Nigeria's 34.2 milli...

Multiple western newspaper headlines are screaming of a " disaster in the making " in Pakistan after the latest population census in the country. These headlines beg the following questions:  Is Pakistan's total fertility rate of 2.62 children per woman a bigger disaster than the sub-replacement level of less than 2 children per woman in the West? Are the rapidly aging western societies and declining working population less of a disaster than Pakistan with its younger population and a growing percentage of it in the work force?  To answer these questions, let's consider the following quote: “So where will the children of the future come from? Increasingly they will come from people who are at odds with the modern world. Such a trend, if sustained, could drive human culture off its current market-driven, individualistic, modernist course, gradually creating an anti-market culture dominated by fundamentalism - a new dark ages.” ― Philip Longman,  The Empty Cradle: How F...

Pakistan's  labor force expansion  is the 3rd biggest in the world after India and Nigeria, according to  UN World Population Prospects 2017 . Rising working age population and growing workforce participation of both men and women in developing nations like Pakistan will boost domestic savings and investment, according to  Global Development Horizons (GDH) report . Escaping the low savings  low investment trap  will help accelerate the lagging GDP growth rate in Pakistan, as will increased foreign investment such as the Chinese investment in  China-Pakistan Economic Corridor . Pakistan's Total Fertility Rate 2.62 Children Per Woman. Source: Washington Post  Labor Force Expansion: The latest Census 2017 results show that Pakistan's population growth rate has declined to 2.34% between 1998 and 2017, down from 2.61% (from 1981 to 1998) and 3.4% (from 1961-81). Life expectancy has increased from about 62 years in 1998 to 66.5 years now. The ...

Guest Post by Khurram Zafar I believe that the technology entrepreneurship ecosystem in Pakistan is at a tipping point! There are a number of factors at play that make Pakistan so ripe for both local and international investors looking to invest in the tech space: Quickly growing  internet adoption currently estimated to be  25 million internet users and 15 million mobile internet users ; Cheap smart phone devices  costing under $50 ; 3G  and  4G  rollouts; Massive amounts of marketing and media spend by companies like Rocket Internet, Schibsted, and Naspers that’s targeted to make Pakistani consumers comfortable transacting online; Development of platforms like  The Foundation  at  LUMS Center for Entrepreneurship  and  Plan9  that are supporting passionate entrepreneurs during their formative years; Slow but steady investments flowing into startups at seed (e.g.  Kima Ventures investment into Eyedeus Labs ...