TRADE POLICY

Economic growth, import/Export, industrial growth

Name: Khaliq Yar

Class: BBA 7th (Reg)
Roll No: 47
Submitted To:
Sir Shahzad Hassan
Literature Review:
Gravity Model derive from Newtowns Law of universal Gravitation, Begen
(1962) and Poyhonen (1963) use of this concept in the area of international
Trade, according to the model, the volume of trade between two countries like
the Gravitation force between two Objects, depend directly on their
respective masses(GDP) and inversely on their distances..(Transportation cost).
On the basis of gravity model variables the researcher fine Pakistan trade
potential is highest in the countries Asian, American, japan, Italy and Europe,
by using the (SAARC, ECO),. Pakistan can eliminate the trade barriers and
Expand its market share with positively building relations the regional
countries.
(Nazia gul & Hafiz M. yasin 2011)
Estimated imports and exports characteristics of Pakistan trade with traditional
trade partners and some Asian countries. Income is the principal determinant
of exports and imports. Pakistan exports are cointegrated with japan, USA. Pak
imports are cointegrated with UAE,USA, Bangladash and sirilanka. Income and
exchange rate are both important determinants of foreign trade. Pakistan
should make efforts to increase their imports exports with Asian countries
notably china and India because they have huge market
(Jahanzaib Haider & M.Afzal 2011)
Entrepreneur is considered as business activity undertaken with a combination
of innovation and Risk taking to earn profit as well as bear losses. Pakistan is
unable to provide to sustainable support to small scale industry and industry as
well as unable to support economy. This study is emphasis on the effort
required for academic-industrial collaboration research to enhance
management knowledge entrepreneurship skills and techniques to create a
broad trade and captured big market portion. (Shahzad Shabbir 2014)
Policies towards foreign trade are among the more important factors
promoting economic growth and convergence in developing countries. Judges
that it is straight forward to demonstrate empirical the superior growth
performance of countries with outer-oriented trade strategies (Krueger).
Integration into the world is the best way for countries to grow (Fisher 2000).
(Francisco Rodriguez 2000)
Endogenous growth theory has provided a more convincing and rigorous
conceptual framework for the analysis of the relationship between trade
liberalization and industrial growth in pakistan. There are number of empirical
studies linking economic growth to the openness of the regime (Bhegwati
1982, s 1978). There are positively corelated of variables trade liberalization is
independent and economic and industrial growth is dependent variable
(Dilip Dutta & Nasiruddin 2006)

India and Pakistan have been reluctant trading partners. Although

bilateral trade between the two countries has increased in recent years,
obstacles remain in the realization of trade potential. When, in 2006,
Pakistan ratified the South Asian Free Trade Agreement (SAFTA), this
was seen as a breakthrough, considering that India-Pakistan trade has
been the primary stumbling block for greater economic integration of the
SAARC region.(Asad Sayeed 2005)

References
Gul, N. (2011). The Trade Potential of Pakistan: An Application of the
Gravity Model Nazia Gul and Hafiz M. Yasin. Lahore Journal of
Economics, 16(1), 23-62.:

Haider, J., Afzal, M., & Riaz, F. (2011). Estimation of import and export
demand functions using bilateral trade data: The case of
Pakistan. Business and Economic Horizons (BEH), 6(1232-2016-
101151), 40-53.
Shabbir, M. S. (2014). The Level of Entrepreneurship Growth and
Obstacles In Trade Openness: A Comparative Study Of Asian Countries
Pakistan, India And Malaysia. Journal of Contemporary
Management, 3(4), 33-47.
Rodriguez, F., & Rodrik, D. (2000). Trade policy and economic growth: a
skeptic's guide to the cross-national evidence. NBER macroeconomics
annual, 15, 261-325.
Dutta, D., & Ahmed, N. (2004). Trade liberalization and industrial growth
in Pakistan: a cointegration analysis. Applied Economics, 36(13), 1421-
1429.
Sayeed, A. (2005). Gains from trade and structural impediments to
India-Pakistan trade. Karachi, Pakistan: Collective for Social Science
Research.