Decade long 35% growth/yr of Pakistan stock market is only a springboard

Posted on May 8, 2008 by moinansari

The Pakistani stock market was the number one stock market in the world according to the World Bank. Its phenomenal growth this year is not an anomaly but rather capstones ten years of unprecedented growth. The US ambassador made some positive comments about the stock market of Pakistan. Arab investment is pouring in and the Chinese investment is ready to break the dam. Local entrepreneurship is the main engine behind the growth of the stock market.

AGRICULTURE: Food for UAE from Pakistan: Investros set up agri bank to help farmers. Agriculture remains a bed of great opportunity. UEA buys $5 Billion worth of farms in Pakistan to ensure food supplies from Pakistan and avoid food shoartage in the Gulf States. Horticulture and agriculture profits are ripe for the picking (http://rupeenews.com/2008/05/09/got-milk-pakistan-gulfs-food-granery/). The Gulf states recognize the potential of Pakistan. They have identified a policy and are implementing a food security plan for the Greater Middle East. Pakstani labor, land and resources are a major part of the policy.` The Gulf region imports $200 bilion of food. Pakistan is poised to grab a major share of that market.

COAL Coal mining and generation of electricity is a huge opportunity for investors because Pakistan has the worlds 4th largest coal reserves (http://www.dawn.com/2004/09/20/ebr10.htm).

Pakistan’s Thar Desert contains the largest coal reserves discovered to date, covering an area of 10,000 square kilometers. The Thar Coal Field, should it be developed, will yield over 200 billion ton of coal used to produce electricity, it will yield sufficient power to make Pakistan self-sufficient in Electrical power.http://www.pakistaneconomist.com/issue2001/issue34/i&e1.htm

BULLET TRAINS: There is also great opportunity is setting up bullet trains and railway projects. Investors can also take advantage of the booming Call Centers in Pakistan as well as off-shore factories in software. The Software industry in Pakistan is set to reach about 11 Billion Dollars in the next few years. Labor rates are low, and with China setting up 6 new industrial zones, manufacturing will take off. In the entertainment industry, there is a lot of local talent for movies as well as music which has been very successful.There are some exceptions to the gloom, particularly in “frontier” markets like Egypt and Pakistan that aren’t on the radar screen of the average investor. Shares in Egypt and Pakistan have risen 7.7% and 7.4%, respectively. Heidi Moore of the Wall Street Journal put a very unattractive picture in her article which is really disgusting. This shows the basic prejudice of the author.

Opportunities for growth for Pakistan

STRUCTURAL REFORMS IN AGRICULTURE: (http://rupeenews.com/2008/05/09/got-milk-pakistan-gulfs-food-granery/) Pakistan needs structural reforms in agriculture to raise the per hectre yields. High quality seeds, fertilizer, tractors and combine harvesters could totally revolutionize agriculture and become a export powerhouse. A lot of agricultural products are lost in the supply chain from the field to the supermarket creating food shortages and increase in prices. According to some estimates more than 50% of Pakistani agricultural goods are lost in the archaic Indus Valley era supply chain. Refrigerated cargo trucks could ship vegetables and fruits to refrigerated ships to their destinations in Europe and American. Pakistan could ship roses, and flowers kept at almost zero degree temperature and get Billions of Dollars during Valentines Day.