Investment Opportunities In Pakistan & Why to Invest In Pakistan?

Submitted to Prof Bilal Sarwar Submitted by Arslan Nawaz L1F11MCOM2165 Section E

Investment opportunities in Pakistan

Following investment opportunities are available to investors in Pakistan. Investment in Real Assets
$ $ $ $ Buying and selling gold. Investment in different economic sectors like Agriculture, Oil etc. Establishment of new companies Real estate

Investment in Financial Assets

$ $ $ $ $ $ $ $ $ $ $ $ $ $
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Saving Accounts by different commercial banks at different profit rates.1 Share of different companies. Special Saver Certificate by Bank AL Habib Limited2 Sukuk Term/Fixed Deposit by different commercial banks at different profit rates.3 Term Certificates4 Treasurer's Call by Bank AL Habib Limited5 Treasury Bills (T-Bills)6 Terms Finance Certificates (TFCs) Certificate of Islamic Investment (COII) by different commercial banks.7 Certificate of Deposit (COD) Tenor of Deposit: 3 month to 10 Years. Certificate of Investment (COIs) Engro Rupiya8 Defense Saving Certificates (DSC)9

Rate of profit is 6.50% to 10% Three year Savings Certificate. Minimum Amount required to invest in the certificate is Rs. 25,000 and profit rate is 9.25%. 3 Rate of profit is 8.22 to12.25 4 Investment can be made for 3 months, 6 months, 1 year, 2 years, 3 years and 5 years and 7 years 5 AL Habib Treasurer's Account. Profit is calculated on a daily product basis and credited to Account monthly. Rate per Annum 1.25% to 1.75% + on different deposit amount. 6 Treasury bills issued by the Government of Pakistan and sold through the State Bank of Pakistan via fortnightly auctions. T-Bills are issued with maturities of 3-months, 6-months and 1 Year minimum denomination of Rs.100, 000. 7 Investment can be made for 1 month, 3 months, 6 months, 1 year, 2 years, 3 years and 5 years to 8 years. 8 Fixed Profit rate of 14.5% per year payable every 6 months for a tenor of 3 years. Minimum investment of Rs. 25,000 with increments of Rs. 5,000

$ Mutual Funds $ Pakistan Investment Bonds (PIBs)10 $ KESC AZM Term Finance Certificate

Why to invest in Pakistan as compared to neighboring countries?

International Rankings World Bank in its annual "Ease of Doing Business" report of June 2011 recognized Pakistan the 3rd most business friendly country in the south Asia while Sri Lanka, India and Afghanistan ranks on 2nd, 6th and 8th positions respectively. Ease to Investor Equal treatment of local & foreign investors. All economic sectors open to foreign investors. Foreign equity up to 100% allowed. No Government permissions required. Remittance of capital, profits, royalty, technical & franchise fee allowed. The facility for contracting foreign private loans is available to all those foreign investors who make investment in the approved sectors. Zero import duties on capital goods, plant and machinery and equipment not manufactured locally. Central Board of Revenue (CBR) can supply a list of locally manufactured good. In case of doubt the investor is invited to consult the Board of Investment (BOI). Zero import duties on raw materials used in the production of exports. Investment in Construction Sector Due to over population there is the high demand of houses as compared to supply. Availability of hard working, intelligent and skilled labor at lesser cost. High Interest Rates Interest rates in Pakistan remain amongst the highest in the world. The Central Bank has announced the discount rate at 12%, keeping it between 12-14% over the last several
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These certificates are available in the denominations of Rs.500, Rs.1000, Rs.5,000, Rs.10,000, Rs.50,000, Rs.100,000, Rs.500,000 and Rs.1,000,000 10 PIBs are long term bonds issued by the Government of Pakistan and sold through the State Bank of Pakistan via periodic auctions. PIBs are issued with tenors of 3, 5, 7, 10, 15, 20 and 30 Years. The minimum denomination of PIBs is Rs.100, 000.

years. Interest rates in China, in comparison, are at 6.56%, in United Arab Emirates at 1%, and in the United States of America and United Kingdom at 0.25% and 0.5% respectively. Oil and Gas Sector Oil and gas is another sector in which investor can have offshore and onshore exploration. They can invest in refinement, pipelines and storage facility. Investment in IT Sector Provision of low-rent Software Technology Parks (STPs), with fiber-optic connectivity, libraries and conference rooms. Provision of funds to software companies to achieve ISO9000 certification and CMM/CMMI rating. 100% ownership of equity allowed to investing foreign IT/ITeS companies. Tax exemption for IT companies till 2016. 100% repatriation of profits allowed to IT companies. Seven years' tax holiday for venture capital funds. Minimum rate of 30% depreciation on computer equipment. Investment in Communication Sector Pakistan has more than 20 million Internet users in 2009. The country is said to have a potential to absorb up to 50 million Internet users in the next 5 years thus a potential of nearly 1 million connections per month.