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Structural and External Barriers to Pakistan’s Economic Growth: Pathways to Sustainable Development

Author

Listed:
  • Naveed Ali

    (Department of Political Science, University of Campania ‘L. Vanvitelli’, 81100 Caserta, Italy)

  • Olivier Karl Butzbach

    (Department of Political Science, University of Campania ‘L. Vanvitelli’, 81100 Caserta, Italy)

  • Habib Ali Katohar

    (Department of Basic Sciences and Related Studies (BSRS), Mehran University of Engineering and Technology, Shaheed Zulfiqar Ali Bhutto Campus, Khairpur Mirs 66020, Pakistan)

  • Hassan Imran Afridi

    (Centre of Excellence in Analytical Chemistry, University of Sindh, Jamshoro 76080, Pakistan)

Abstract
Pakistan’s economic growth has been hindered by various internal and external factors since its independence in 1947. This study aims to identify the root causes of these issues and provide a comprehensive understanding of the country’s economic situation. Internally, inefficient bureaucracy, corruption, inadequate support for small and medium enterprises (SMEs), labor market rigidity, tax evasion, and regional inequalities have impeded development. External factors such as political instability, terrorism, weak governance, foreign policy challenges, and insufficient infrastructure have discouraged investment and disrupted economic activities. Pakistan’s reliance on low-tech exports has also led to a loss of competitiveness in international trade. To revitalize the economy, the study suggests reforms in governance, bureaucracy, and infrastructure, with a focus on supporting SMEs, reducing corruption, and attracting investment. The adoption of circular economy (CE) practices, particularly through the use of recycled materials, is proposed as a viable pathway to enhance economic resilience and environmental sustainability. The study highlights the potential for integrating CE strategies, drawing from successful global practices, to address Pakistan’s economic and environmental challenges. However, the reliance on historical data and linear econometric models may not fully capture the evolving economic dynamics, necessitating further research incorporating real-time data and sector-specific approaches. Despite these limitations, the study provides actionable insights for policymakers, offering a framework for Pakistan and other developing economies to achieve sustainable growth.

Suggested Citation

  • Naveed Ali & Olivier Karl Butzbach & Habib Ali Katohar & Hassan Imran Afridi, 2024. "Structural and External Barriers to Pakistan’s Economic Growth: Pathways to Sustainable Development," World, MDPI, vol. 5(4), pages 1-10, November.
    • Handle: RePEc:gam:jworld:v:5:y:2024:i:4:p:56-1129:d:1516004
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    References listed on IDEAS

    as
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    3. Mahmood Khalid & Muhammad Nasir, 2020. "Tax Structure in Pakistan: Fragmented, Exploitative and Anti-growth," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 59(3), pages 461-468.
    4. Adnan Haider & Musleh ud Din & Ejaz Ghani, 2011. "Consequences of Political Instability, Governance and Bureaucratic Corruption on Inflation and Growth: The Case of Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 50(4), pages 773-807.
    5. Nazish Afraz & Syed Turab Hussain & Usman Khan, 2014. "Barriers to the Growth of Small Firms in Pakistan: A Qualitative Assessment of Selected Light Engineering Industries," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 19(Special E), pages 135-176, September.
    Full references (including those not matched with items on IDEAS)

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