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A Critical Study of the Project Appraisal Management and Control System in Pakistan: An Exercise in Evaluation
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 1989) Saiyeda Zia Al-Jalaly; Supervised by Main M. Nazeer
In common with most developing countries, the history of planned development in Pakistan is replete with flopped projects, projects that don not see themselves to completion within the stated time and cost, or projects which do not fulfil their avowed objectives. Even otherwise well conceived projects face difficulties at the implementation on other related stages. Worse Still, the project cycle system has neither been examined nor regarded in its totality as an integrated system. This study is an in-depth analysis and evaluation of the project appraisal, management, and control system in Pakistan. The approach taken is an integrated one where, despite the emphasis on the ex-ante appraisal and implementation stages, the entire project cycle in Pakistan has been examined in order to the able to link the stages and study the problems of omission and commission which emerge at the implamentation stage. The study is, however, confined to the public sector projects which need to pass through the well laid out procedures. Being a study in the evaluation of a system, it has involved quantitative as well as qualitative examinations. These examinations range from a review of the theoretical aspects of the project cycle and its stages as well as the techniques used at various stages, to the progression of the project cycle in Pakistan, and eventually to an evaluation of the system and recommendations to improve the system. The theoretical sections are based on an extensive review of literature followed by use of secondary data based on government publications, supplemented by intervious and discussions with experts involved at various levels of planning and stages of the cycle. The main findings of the study centre around the inadequacies in the structure of PC-1, cost and time overruns, data gaps, motivation and training of personnel, lack of coordination, absence of contingency planning, lack of appropriate apprasal parameters, problems relating to project selection criteria and procedures, lack of staff, absence of an institutional link between appraisal wing and monitoring team. Findings relating to the approval and implementation stages of projects relate to the distortions arising out of anticipatory approvals, breaking of projects into smaller components to avoid higher echelons of approval and appraisal, problems arising out of the discrepancies between the need and availability of resources, a total absence fo any input or tiem plans leading to raw material constraints, delays in the provisions of essential services and physical infrastructure, problems arising out of the bases of award of contracts and selection of sites, lack of inter-agency coordination and communication and lack of a modern progress monitoring system. Findings in the field of project montoring/control centre inter alia around lack of processing of the information collected, too much information requested, jtoo frequently, and no sifting of information by level of importance, lack of trained personnel to undertake montoring; absence of an institutional monitoring set-up to handle un-anticipated problems; absence of forward and backward flow of information and decisions through an established channel. The study comprises six chapters- the first four laying out the system as it is, the fifth is devoted to an evaluation of the system, while the sixth contains the main conclusions and policy recommendations.
The Role of Tourism in the Economic Development of Pakistan A Case Study of Northern Areas
(1998) Muhammad Bilal Malick; Supervised by Dr. Naeem ur Rehman Khattak
The present study, conducted with main focus on Northern Areas, was designed to: inquire into the state of tourism potentials; assess its socio-economic impact; and draw guidelines for minimisation of its adverse and maximization of beneficial impacts in future. The study is addressed to, but not mainlyfocused on, hypotheses that: (i) there is a positive relationship between tourism and economic development; (ii) the socio-culturalfactors and tourism are not necessarily inversely related; (iii) the intensity ofsocial, economic, environmental, and other impacts oftourism moves in sympathy with the level oftourists inflow expressed asproportionoflocal population in tourist receiving area. MAIN FINDINGS: The study, on the whole, brings out thefact that tourism has hadpositive impact on project area and that these promise to grow deeper and wider as tourism grows. Main findings in this respects are as follows: • Most of the tourists were domestic; inflow of foreign tourists is, however, positively upward. • Some 60% of tourists were males; majority belonged to 16-30 years age group; as many as 94% were educated; 88% visited the project area for the first time; 50% spent 4-8 nights in the project area. • The single largest category (35%) of tourists comprised of students/teachers, followed by government employees (31%), commercial employees (17%) and businessmen (3%). • Most tourists carried with them Rs. 8,000-10,000 per headfor visit to the Northern Areas. Majority of them spent around Rs. 300-400 per day per head. • The single largest number of local tourists came from NWFP (45%), followed by Punjab (41%), while among the foreign tourists the corresponding position is held by England (27.3%), followed by Germany (20.4%). •Tourism has positively affected agricultural sector of the economy. Total operated area under cultivation increased by 28% during last 10 years. Overall production ofcrops especiallyfruits increased by 782%; vegetables 510%; fodder crops 650%; wheat 31%; and maize 20%. Land management practices have improved too. Farmers cultivate all crops more scientifically than before. Use of mechanization on farms has increased nearlysix-folds. Average income from agricultural sector has increased from Rs. 15,00020,000 per annum in 1984, to Rs. 30,000-40,000 per annum in 1994. •Although agricultural sector is still the main provider ofjobs considerable expansion has taken place in off-farm employment and tourism development has made a major contribution in this respect.j •There were no reports of women engaged in tourism sector. However, they are now getting better job opportunities in health and education sector comparedto ten years before. •The project area has registered considerable improvement in infrastructure during 1984-94. There has been much expansion in banking (92%), communication facilities (203%) schools (316%), health facilities (121%), electricity (233%), sanitation (275%), water (103%), roads (83%) and housing (144%) during last ten years. These developments have facilitated tourism and are also to an important extent the outcome of tourism development policy of the government. •Mobility of local people has also increased. Visits tofamily andfriends have increased by 125%, visiting more places by 788% and utilization of modern vehicles by 362% during 1984-94. •Temporary and permanent out migration of local people has come down by 28% and47% respectively after 1984. However, temporary migration of local people to urban centers, within project area, forjob/business has increased by 153% and temporary inflow of outside people to project area for job/business has increased by 267% in last 10 years. •Tourism has had very little adverse impact on the level ofcorruption, dignity ofpeople, and goodwill towards foreigners in the area. Local controls are foundstill effective. • Some concern isfound among the locals as well as tourists about increase in deforestation, soil erosion and excessive hunting of the wild life in the area. The project area cannot withstandflow of mass tourism, overcrowding and excessive use ofplaces for recreation. •Tourism promotion has induced changes in consumption behaviour of the local population, with regard to certain types ofbeverages, vegetables, dairy products, andfashion accessories etc. The average consumption expenditure of sample family has gone up from Rs. 20,000-30,000 per annum to Rs.30,000-40,000 per annumin last ten years. • Rise in local people’s income and employmentlevel, to which tourism has made a good contribution, increase in their mobility, and their growing contacts with tourists from more developed regions of Pakistan, as well as foreign countries, have had a positive impact on their attitude towards, and perception of, modern education, modern medical practices (allopathic treatment) in preference to old ones, housing, sanitation etc. The quality of life has, thus on the whole, been improving due to these positive influences. CONCLUSIONS: Several important conclusions emergefromthis study’s findings on socio-economic impacts of tourism in the context of Pakistan in general and Northern Areas in particular. These conclusions are stated below with reference to the study’s hypotheses. I) Thereis a positive relationship between tourism and economic development. The study confirms this hypothesis. In the particular case ofNorthern Areas, tourism has proved to be one ofmajor catalysts ofinitiation and acceleration of development process, and this role will grow with further growth of tourism. All sectors of the project area’s economypresent positive readings. The farm sector has experienced significant expansionbothvertically and horizontally. Visibility ofnon-farm sector’s expansion is even greater. Thus, all told, a Significant rise in income and employment has taken place in the project area, more goods and services are available now than before, consumption patterns are changing, and the local economyis on the whole muchbetter placed than a decade ago. Thus, tourism has made a significant contribution to the area’s economy. II) The socio culturalfactors and tourism are not necessarily inversely related. The study'sfindings confirmthis hypothesis, but with reservations. In the particular context of the project area, little or no impact on the area’s overall social and cultural environments has been caused bytourists inflow yet. Some adverse impacts, on negligible scale, have been observed in localities which receive tourists in a relatively large number — and these are all urbanlocalities. But local institutions are still strong enoughto counter the negative impacts. The project area is not yet exposed to negative impacts in this sphere, because the tourists are relatively small in number. But, the hazards are bound to grow as tourists’ number relative to local population increases. Appropriate planning can, however, help minimize these hazards. III) The intensity of social, economic, environmental, and other impacts of tourism moves in sympathy with the level oftourists inflow expressed as proportion of local population in tourist receiving area. This hypothesis is confirmed by the present study. Infact this conclusion is embodied in hypotheses as discussed above. Tourism has begun positively impacting the project area’s economy. The strength of impacts is presently low, but it will increase with tourists inflow, repeat visits, and increase in stay. The adverse impacts are lowor negligible presently — such as erosion ofsocial values, sexual immorality, crimes, conspicuous consumption, etc. A definite positive association betweenthese negative impacts and level of tourists inflow is observable. Appropriate planning can, however, help minimize the same. Thus, to conclude, the above hypothesis in duly verified by the study’sfindings. Summing up the aforestated three inter-linked conclusions, it is concluded that tourism, if properly planned and kept within tourists receiving area’s tourists carrying capacity, performs the role of catalyst of development. It contributes positively to initiation and acceleration ofthe process ofdevelopmentandinits turn receives impetusfrom the same i.e; development. Therefore, tourism industry should be an integral component of development plans for areas that have tourists attractions, such as the Northern Areas.
An Inquiry into Genesis and Socio-Economic Impact of Land Reforms in Pakistan with Particular Reference to NWFP
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 1998) Shahriyar Khan; Supervised by Abdus Samad Khan (Director, Center of Applied Economics Studies, UOP)
This study traces the genesis of land reforms in Pakistan with particular reference to the North West Frontier Province (NWFP), appraises their socio-economic impact, and examines the case for further reforms. It embraces the tenancy, quasi-distributive, anddistributive reforms introducedin post-1947 period in Pakistan, but the main focus is on the distributive land reforms (DLRs) of 1959, 1972, and 1977. The genesis of land reforms, designed to reduce concentration of land ownership, is traceable to the legislations introduced in early fifties to improve tenanc ysituation, confer ownership rights on occupancy tenants, and abolish the Jagirs. These reforms proved as precursors to the DLRs the first of which was introducedin 1959. The chronology and contents of land reforms-in the widersense, clearly show that the ruling political parties adhered to the policy of gradualism, rather than radicalism, on the land reform front. In the first phase, lasting over a decade, the reforms aimed at only minimizing the adverse impacts of mal-distribution of land through tenancy and quasi distributive reforms, but avoided correcting the land distribution pattern. Mounting pressure for imposing a land ownership ceiling led the government to introduce the required legislation, but only as late as 1959. The 1959-Land Reform was by all standards a very lenient reformas clearly indicated by the high land ceilings, liberal concessions, and several exemptions providedby it. Even where no exemptions/concessions were available, a person could retain as many as 36,000 PIU worth of land or 500 acres/irrigated or 1000 acres/unirrigated land, whichever be more, which was considered to be too high a ceiling. The 1972-land reform loweredthe ceiling to 12,000 PIUs, again rather too high as indicated the fact that the average farm size then obtaining in the country was a mere half of the subsistence holding (12.5 acres). This realization led to a further lowering of land ceilings to 8,000 PIUs in 1977. All the three DLRs were launched with great expectations with respect to their positive socio-economic impacts. This study finds that on the whole the impacts have been of a positive nature, but their quantum has been too small to be called significant. A definite limit to land ownership has been imposed, and the old craze land accumulation seems to have subsided. But very little of the privately owned land has changed hands. a very small percentage of big land owners has been affected, and similariy a very small percentage of small farmers/tenants has been benefitted as will be borne out by the following statistics. Sr.No. Particulars Units Land Reforms of 1959, 1972 &1977 NWFP Pakistan 1. Affected Landlords Number 502 2. Total area resumed Acres 407,381 4,055,363 3. Area given to tenants/small farmers Acres 161,578 1,777,711 4. Number of beneficiaries Number 37,549 262,700 5. Average area recieved per beneficiary Acre 6.78 4.3 6. Total resumed area as %age of total 6.94 4.5 privately owned land in NWFP Thus, only 6.94% of the privately owned land was resumed in NWFP. This is too small anarea to affect the land ownership pattern even mildly. Similarly, only 37,549 persons were given land. They constituted approximately two percent of small land owners/tenants who were land aspirants. The smallness of the number of beneficiaries, and also thefact that on average they got 6-94 acres each, is clearly indicative of the smallness of land reform achievements and impacts. Distribution of land on such a small scale should be expected to producenovisible or lasting changeat macro level and thatis confirmed by relevant data. At micro-level i.e; beneficiaries household level, visibility of positive impacts of land reformsis, however, much better. All land recipients have experienced some socio-economic improvements-which most of them attribute to a large extent, to land reforms. The improvements are indicated by increase in the area owned by beneficiaries, rise in agri productivity/employment level/income, better access to educational and medicalfacilities, and beneficiaries expression of a sense of improvementin their socio-economic lot. Although the past reforms havenot madea visible and lasting impact on land ownership pattern andassociated aspects of agri and rural sector, their achievements are on the whole of a positive nature. Thenotedpositive impacts al macro and micro levels under score, if anything, only the need of further reforms of more radical nature and a wider scope. The land ceilings need be lowered and they should be placed on family holdings. Thereis simultaneously a need also to check proliferation of farms i.e; the trend towards decline infe rm size need be checked. The reform package should be such that it provides for equitable distribution of land, paves way for scientific agriculture, provides for more employment, and in the ultimate analysis turns agriculture into a dynamic sector.
Association Among Fertility Behaviour in Women Using Various Contraceptive Methods (A Case Study of Pakistan)
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 1998-08) Ijaz Majid; Supervised by Dr. Naeem ur Rehman Khattak
The data collected by the National Institute of Population Studies, Islamabad in Pakistan Demographic and Health Survey, 1990-91 was analysed and investigated in this study. The data was in the computer base of the Institute consisting of 6,611 eligible women. The main emphasis ofthe data was on, background characteristics, reproductive history, knowledge and use of contraception, pregnancy and breast feeding, vaccinations and the health of children, marriages, family size preferences and husbands background. The main objective of this study was to_ investigate statistical methods, which can be used. for the analysis of such data, so as to identify various variables that can affect the fertility pattern of the women using various types of contraceptive methods. This in turn will lead to identify variations among different methods of contraception that will have an effective control on the fertility of a woman. For this purpose, different methods of analysis previously being used and recommendedin the literature were studied and new methods were developed for analysis of this data so as to identify the variables of importance. Since the main purpose of the study was to investigate an association amongthe Fertility Behaviour in Women using different methods of Contraception/fertility regulation methods. The initial part of the study contained an elementary data analysis of the data. This was done to find out the a sources of variation in the data, and to investigate the important variables affecting the fertility behaviour of the women. The current trend of rapid population growth in Pakistan calls for serious thinking and action. If it is allowed to continue with the prevailing growth rate, it will adversely effect the socio-economic development of the country as with the current rate we are heading towards what is called population bomb. If it explodes, it would devastate the economic and social fabric of our country. Hence,it is the time that these important variables effecting the fertility behaviour of a woman should be taken care off. In this study along with simple analysis of cross tabulation and summary statistics computed, regression analysis was also used. The method of regression analysis was used in two steps. First, simple regression models were analysed. Second, in order to see the effect of a variable on the dependent variable, new regression models were formulated and analysed. This method helped us in pinpointing the important variables and finally developing a model of choice. Further Analysis of Variance was used to see the overall significance of regression models. The important variables as identified in the present study were age of the respondent, education,living number of children, family planning practices and attitudes, spousal communication and husbands level of education etc. Finally one o fthe major conclusions derived from the present study wasthat there was a strong association among the fertility behavior of the women using various contraceptive methods and hence its effects on the numberf born. Besides this, the study indicated that modern contraceptive methods are more effective as compared to traditional methods.
A Comprehensive Analysis of Wheat Production and Balances Its Demand and Supply Problems and Remedial Measures (A Case Study of Pakistan)
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 1999) Mohammad Naeem; Supervised by Prof Abdus Samad (Director, Center of Applied Economics Studies)
Wheat is a universally cultivated and produced staple food item of commonuse. In Pakistan, it is being used regularly. Its extensive and constant use has made people habitual ofit and they cannot evenbearits partial shortage or scarcity. The purpose of the present study is to remove suchtransitory shortages between consumption (demand) and production (supply) to bridge the gap between them throughefficient wheat policy. Consumption (demand) of wheat depends highly on population growth and changes in per capita income of the country. Population of Pakistan is increasing at a higher rate (2.7 percent), which is creating pressure on the cultivated land and thus adversely affecting production of wheat. Moreover, the per capita incomeis increasing at a rate of 11.9 percent which is raising the aggregate demand for better quality of wheat. Thus, a gap is created between demand and supply of wheat whichis further widening with the passage of time. This problem can be solved throughefficient government policies, which will bring self-sufficiency of wheat to the economy and may even lead towards exportation of wheat and earn foreign exchange in import substitution. Self-sufficiency in food grain productionis the national goal. Pakistan enjoys a comparative advantage in wheat production, therefore, the self-sufficiency goal is theoretically valid. The essence of the findings of the present studyis that the irrigation induced technological changes would accelerate the growth of wheat production, resulting in a gain of economic efficiency and achieving self sufficiency. The key success to increase wheat production lies in rapid adoption of technology. The diffusion of biochemical technology (HYV, fertilisers pesticides, etc) is a more appropriate path towards technological progress than alternative labour saving mechanisation (labour — intensive and capital intensive techniques). Production (supply) of wheat depends onthe total land availability for the crop, irrigation facilities, climatic conditions and market price of wheat. Wheat is sown in the month of November-December, where in rain fed areas, we receive verylittle rain and which alwaysbrings a bad harvest. It is an exceptional case in Baluchistan and N.W.F.P. but bumper cropping in Punjab and Sindh have irrigation facilities. Effort has been madeinthis study to achieve an equilibrium between demand and supply of wheat. For this, data has mainly been obtained and used from government published agricultural bulletins, economic surveys, etc. Moreover a little primary data has also been used for the derivation of Cobb-Douglas production function and Marginal Physical Product of labour. A very useful Auto Regressive Integrated Moving Average (ARIMA) model has been used in this study which has forecasted wheat production upto 2010 (13 years ahead). This will help the planners and concerned agencies in time importation of wheat. The findings of the study are that both irrigation and technology would play the leading role in the growthof future wheat production. The government will also have to change its wheat policies in light of the new development. Specially it has to eliminate subsidies and checkits role in the price formation. Finally if the recommendations ofthe study are adopted, Pakistan will not only become self-sufficient in wheat production but may emerge as wheat exporting country also.
Economic Efficiency of the Agrarian Structure in the North West Frontier Province of Pakistan An Econometric Analysis
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 1999-04) Jehanzeb; Supervised by Dr. Naeem ur Rehman Khattak
The study entitled “Economic Efficiency of the Agrarian Structure in the North West Frontier Province of Pakistan” is exclusively based on primarily data collected from 200 farmers in NWFP, during 1997-98. The farmers have been selected randomly through the stratified Sampling procedure. For analysis, the sampled farmers are grouped on the basis offarm characteristics such as owners, owner-cum-tenant and tenants on one hand, and small and large farmers on the other. The core objective ofthe study is to quantify the economic efficiency of the agrarian structure in NWFP. In the empirical analysis various econometric techniques have beenused. This included the use of Translog Profit function, Lorenze Curve, Gini Coefficient, Cobb-Douglas Production Function and Linear Programming, etc. Beside these, the Marginal Propensity to Consume (MPC) Net Present Value (NPV), Benefit Cost Ratio (BCR) and Internal Rate of Return (IRR) of various agricultural activities are also computed. The structural differences between different types of farms are determined with the help of Chow-Fratio. The results obtained from various statistical and econometric applications are coherent with the economic theory and of great help for diagnosing the agrarian structure of NWFP. Specifically, it has been discovered that the agrarian structure is inefficient mainly because of the skeweddistribution of operational holdings, difference in farm sizes and level of mechanization, land fragmentation, paucity of irrigation water and provision of creditfacilities. The analysis suggested that the level of inefficiency can be reduced to a greater extent by eliminating disparities of operational holdings. Significant reformative approachof land reform is proposed towards this end. The adoption of mechanization and provision of credit extension canalso help to rebate this inefficiency.
FORMAL & INFORMAL SECTOR MICRO ENTERPRISES AND THEIR LINKAGES WITH THE REST OF THE ECONOMY: A CASE STUDY OF PESHAWAR URBAN MARKET
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 2004) Ghazala Yasmeen; Supervised by Dr. Anwar.F. Chishti
This study of 60 cases of micro enterprises, with data for three years (2001-3), found that, on average, a micro enterprise employed 4.54 laborers, with a 70:30 skilled and unskilled labor proportion. A total of Rs.561 thousands were- found invested in each micro enterprise with 39:61 capital and non-capital investments. Of the micro enterprises’ annual average total purchases of Rs.386 thousands, 15% were made from micro enterprises, 26% from small, 30% from medium and 29% from large businesses. Ofthe annual average total sale ofRs.1219 thousands, 48% were made to businesses and 52% to final consumers. Ofthe total sale of Rs.585 thousands to businesses, 19%, 23%, 27% and 31% were made to micro, small, medium and large enterprises, respectively. Micro enterprises, on average, gave rise to Rs.833 thousands per annum as value-addition. Value-addition ranged between Rs.213 thousands and Rs.1908 thousands. It remained fairly stable (CV = 0.4348) over the 2001-2003 period. Micro enterprise appeared to be the most contributory business medium;first, these provided employment to 4 — 5 persons per micro business and had been found the most labor-intensive businesses compared to small, medium and large enterprises. Second, micro enterprises contributed positively towards capital formation; on average, these increased their total investments by 66.60%, including a 100% increase in fixed capital and 50% increase in working capital. Third, contribution of micro enterprises towards value addition remained the highest (value-addition of Rs.02.19 for every rupee spent on raw-material purchases) compared to other businesses (Rs.01.52, Rs.01.80 and Rs.01.82 for small, medium and large enterprises, respectively). Fourth, micro enterprises contributed, on average, Rs.52 thousands to Rs.59 thousands to family welfare on monthly basis. Econometric analysis ofvalue addition in micro enterprises suggested that capital investments yielded the greatest positive contribution, followed by training of the entrepreneurs and improvementofskills of the labor engaged. second,sales to final-consumers accounted for the highest contribution, followed by sales-to-other businesses and sales-to-micro enterprises. Third, purchases (of raw materials), both from other businesses and micro enterprises, being the cost items, were negatively related with value-addition; however, since higher negativity came from purchases-from-other-businesses compared to the purchases-from-micro enterprises, the enhanced purchases from micro enterprises would help increase value-addition. The Leontief Input-Output model helped to estimate the ‘extent of backward linkages’, namely bLj > 1 for micro enterprises and bLj <1 for small, medium and large businesses, suggesting that it were only micro enterprises, whereina unit increase in final demand gaverise to a greater than average impact.The study recommended that establishment and development of micro enterprises be given priority, with special emphasis on more investments in capital goods, improvement ofemployees, skills and training ofthe entrepreneurs. It was further recommended that, without ignoring the importance ofsales-to-businesses, salesto-final-consumers be given special care as well as special emphasis be put on purchases-from-micro enterprises, without ignoring the importance of purchasesfrom-other businesses.
THE CAUSES AND EFFECTS OF AGRICULTURAL MECHANIZATION AND LABOUR DISPLACEMENT IN NWFP
(2004) Muhammad Aurangzeb; Supervised by Dr. Mir Kalan Shah
The present study is based on cross sectional data of200 randomly selected respondents (130 mechanized and 70 traditional farms) in Peshawar District. The study shows that land owners have brought over 20 % ofwaste land under cultivation by utilizing farm machinery. The farm mechanization displaced over 35 % tenants who adopted other professionsresulting in significant increase in their income. The study exhibits that wheat and maize are the major crops in the research area. The manual labour requirements of the mechanized farms are nearly 23 % (in case ofthe wheat crop) and 50 % (in case of the maize crop) of that used on the traditional farms. The mechanization has, therefore, substantially reduced the manual labour input. Moreover, the rate of change ofthe mechanized farms is higher by 2.49 units for wheat and 2.33 units for maize than the traditional farms. The Marginal Physical Product (MPP) of machinery is higher than that ofthe manual labour and animal labour. The MPP ofmachinery is significantly higher on the ownercultivator farms as well as large farms. The analyses show that the yields per unit land of the major crops and milch animal population of the mechanized farmsare significantly higher than that ofthe traditional farms. The summation ofincome elasticity of inputs is less than one for each ofthe farming systems (mechanized/ traditional). As such it is operating at the stage of decreasing returns to scale. However, in this respect the traditional farms are worse than the mechanized farms. Both the croppingintensity and land use intensity of the mechanized farms are higher than that of the traditional farms. The mechanized farms have higher off-farm earnings due to their higher educational level as compared with traditional farms. The results depict that mechanization ofagriculture ofthe NWFP is lower as compared to other parts ofthe country. The availability of credit for different farm operations through a simple lending procedure is essential for the needy farmers. As the average land holding of the Province is much lower than the national average, so small size tractor/ machinery would be more appropriate for cultivation over here. With the adoption of these steps the crop productivity will increase due to which the country’s food and raw materials for manufacturing sector requirements will be met adequately. These measures can enhance the employment opportunities both at the agricultural and manufacturing sectors.
THE REVIVAL OF SICK INDUSTRIAL UNITS IN PAKISTAN (A CASE STUDY OF GADOON AMAZAI INDUSTRIAL ESTATE N-W.F.P) (1988-2000)
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 2004) Rukhsana Javed; Supervised by Ijaz Majid
Industrialization plays a vital role in economic development of a country. But unfortunately from the last few years this sector is facing quite a lot of problems in the country. The number ofsick industrial units is increasing. At present in Pakistan the numberof sick industrial units has gone over 4,000 units. The average growth rate of large scale manufacturing which was 8.2 during 1980, reduced to 1.6 in 1999-2000. The increasing incidence of industrial sickness is certainly a matter of deep concern not only for the industrialists, shareholders and creditors but also for the society at large. Gadoon Amazai industrial estate (GAIE) in NWFP is also seriously affected by this industrial sickness. This industrial estate was established in 1986 by governmentofPakistan to stop poppy cultivation to provide job opportunities to the affected people, to gencrate income for the country to earn foreign exchange and to bring this backward area at par with other developed areas of the country. GAIE with subsequent policies, after enjoying an unprecedented boom among industries for about two years, discovered itself in hot waters. Industrialists started leaving the industrial estate and billions of investments were wasted. People lost jobs, government revenues and industrialists “will” to do business. The purpose of the study was to carry out a comparative economic analysis of the situation before the establishment of GAIE and after its establishment. The specific objectives ofstudy were: To evaluate the role of industrial establishment in Gadoon Amazai area in promoting the socio-economic conditions, to analyse industrial policy of the government of Pakistan regarding Gadoon Amazai Industrial Estate, To identify the causes of sickness of the industrial units in Gadoon Amazai Industria! Estate, to asses the impact ofsick units on the inhabitants ofthe area, to suggest measures for formulating policy for the probable revival of sick industries in Gadoon Amazai, to identify main causes of sickness and to make suggestions for probable revival of these sick units. Two questionnaires were constructed, one addressed to the house hold sector and the other to industrialists. The questionnaires were filled in with the help of face-to-face interviews. The questionnaires addressed to the household sector collected data on house structure, facilities within the house and the socio-economic conditions of the people of the area. All types of facilities were compared before and after the establishment of GAIE. The data collected from the industrialists regarding the reasons of sickness and suggestions for the revival of industries were studied. Findings of the study were summarized andit was concluded that the establishment of GAIE had improved the socio economic conditions of the people of the area and the main reasons of sickness were withdrawn of the incentives. Other reasons were: distance from sea port, dependence on some of imported raw material and machinery, non availability of workshops orno facility ofrepair for damaged machinery, non availability of skill labour, poor infra structure, non availability of natural gas, high electricity charges etc. the sample industrialists recommended certain suggestions for the revivaloftheir sick units, among which the most important was continuation of incentives other recommendations were; provision of training facilities, workshopfacilities, improvement ofinfra structure, provisions of gas facilities and establishment of consultancy offices at GAIE to solve the problems of the industrialists. As Gadoon Amazai industrial estate had improved the socio economic conditions of the people of the area, the recommendations for probable revival ofsick industrial units must be honoured.
Economic Analysis of Consumption Pattern and Living Standard of Rural-Urban Population in North West Frontier Province of Pakistan
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 2004) Zilakat Khan Malik; Supervised by Dr. Jahan Zeb
The activities related to maintaining life and improving its condition encompass both consumption and production. The pattern and composition of consumption determine the standard of living, while the sole purpose of production is to provide the means of consumption and to increase the income. Higher consumption and its appropriate pattern improve the standard of living and economic development. The rural-urban division of population also influences the economic development. Therefore. topic of the dissertation was stated as "Economic Analysis of consumpation pattern and living standard of Rural-Urban population in the North West Frontier Province of Pakistan" and an attempt was made to achieve the following main objectives: To asses the socio-economic conditions of Rural-Urban households and to analyse their budgetary position and To discuss their consumption pattern and living standard and to verify the .following main assumptions: o Socio-economic conditions and the budgetary position were not conducive to improve their living standard. o Significant fraction of income was spent on uneconomic pursuits. The consumption pattern was substandard. Scope of the study was confined to the NWFP. Both the primary and secondary sources of data were used for collection of data. A comprehensive interview schedule Ivas used to collect primary cross section data. A sample size of 120 households was distributed among six villages from rural region and six streets from urban region of the different strata of the province, determined on basis of developed districts and under developed/backward districts. The sample households were selected using a combination of Stratified Random Sampling and Simple Random Sampling techniques. According to Keynes psychological law of consumption, the simple and multiple linear consumption functions were estimated and the Marginal Propensities to Consume and to Save (MPC and MPS) were determined. For the size distribution (income) and determination of degree of poverty, the Lorenz curve, Gini-coefficient and the ratio of bottom 20% to top 20% were used. The study is organized in seven chapters followed by appendices and annexures. Chapter-I and 2 focus on the introduction and review of literature respectively. Demographic features of the sample households are analysed in chapter 3 and chapter 4 is devoted to "Budgetary Position of the sample households-. It was observed that the overall average family size was nine. More than half of the population consisted of dependent class. Females were greater in number. Majority (70%) of the sample population lived in the rural region depending on agriculture. Only 34.10% of the labour force could get employment. A remarkable proportion (84.13%) of unemployed females was recorded in the rural areas. Main occupation in the urban area was business, while it was farming in the rural areas.Majority of the sample households fell in the low income brackets. Very few families could reach higher income brackets. The level of consumption was very low. In absolute terms it it-as Rs. 120 lac per month for 2080 individuals. The consumption pattern was also not on the proper track Allocations to uneconomic pursuits and unproductive expenditures were greater as compared to spending on education. health and balanced .foods. As a consequence the standard of living was substandard and all the indicators did not prove to lead to the economic development. The empirical results also supported that the standard of living was substandard,because a very low autonomous consumption and a high marginal propensity to consume (due to the level of income on or closer to the break even point) led to less savings and in turn a lower level of investment, which adversely influenced production capacity and economic growth. This situation slowed down economic development. The techniques used for the size distribution showed that very few individuals of the society could receive a greater portion of income, while a greater number of households shared a very small fraction of the national income. It was concluded that in addition to some other factors, the unequal distribution of income and its severity were the main obstacles in achieving proper level and pattern of consumption, appropriate standard of living and desirable rate of economic development.
CROSS-DISTRICT MULTIPLE INDICATORS OF QUALITY OF LIFE AND WELL-BEING IN KHYBER PAKHTUNKHWA: DETERMINANTS, VARIATIONS, AND FUTURE OUTLOOK
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 2005) Danish Wadud; Supervised by Dr Naeem ur Rehman Khattak
Quality of Life (QoL) is a multidimensional concept encompassing many spects of an individual’s, community’s, and country’s existence and being. It is not just a measureof material resources at their disposal but ofother more intangible resources and environments which produce effects which enhance their quality of life. The study attempted to concentrate on the province of Khyber Pakhtunkhwaand look at the Quality of Life and Well-being of individuals in thirteen of its districts representing its major population. It followed an integrative approach to measuring Quality of Life. QoL encompasses not only the material aspects oflife like income, employment, housing etc but also the more intangible non-material factors like family, social cohesion,trustetc; influencing it. The method ofPrincipal Component Analysis (PCA) was used to tackle with multidimensionality as well as explain variation in QoL and Well-being. Weighted Factor Score (WFS) were used as an index for ranking districts for QoL and well-being on the basis of social indicators chosen in different domains of life. Both descriptive and multivariate regression analysis was done to estimate the determinants of Quality of Life and Well-being taken as the Overall Experience of Life (OEL). The results show that the majority respondents use public facilities and regard them as good except for public transport. They are mostly not satisfied with their education level and accommodation standards, however, find their health and social life satisfactory. Majority respondents can barely cover their basic expenses, however can just about afford to keep their houses comfortable and have meat or fish weekly and buy new clothes. Most are concerned abouttheir jobs and feel insecure. There is mostly an optimistic response about the future, however they feel their lives are not as they would have wanted them to be and get a sense of belittlement due to their job status or income. However majority say they are not inclined towards corrupt behaviour. There is however a considerable amountofdistrust in institutions and political participation is low. Social interactionis healthyas far as close family is concerned. Majority are of the view that people do not followtraffic rules, disregard caring behaviour in public and evade taxes. Majority of the respondents also believe that a good quality oflife requires good education, a steady job, standard accommodation, wholesome familylife, good health and a fair amountofsocial life. The districts with high urban disposition top the ranksin quality oflife in Khyber Pakhtunkhwa, like Peshawar, Mardan, Swat and Charsadda, while Bannu, Kohat and LowerDirfall amongst the bottom districts in terms of quality of life. The rural/urban ranking also follows similar patterns with a few exceptions. There is a need to increase the quality and access ofpublic amenities, Opportunities of employment, education and health access, affordable and quality housing, encourage building social networks, transparency in_ institutions, encouragementofcivil society involvement, stricter tax rules and penalties, and lastly an utter need to gear up andequipstatistical offices and databases for future research in the area ofQuality ofLife and Well-being as are presently deficient.
DIVERSIFICATION OF THE FINANCIALSOURCES FOR HIGHER EDUCATION IN PAKISTAN WITH SPECIAL FOCUS ON THE SELF-FINANCE EDUCATION SCHEME (A Case Studyof the University of Peshawar)
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 2005) Farzana Shaheen; Supervised by Dr. Sanaullah,
Higher education is experiencing rapid and dramatic changes in Pakistan. The major problem of higher education is in terms of the match between the financial needs and available financial resources. Even though a substantial sum of public expenditure going to higher education there is a belief that the actual amounts allocated are low in relation to need. Apart from, remedying current inadequacy in funding levels, additional funding generally is essential in order for higher education to cope withlikely future expansion. The present study was designed to explore and evaluate the possibilitics of diversification of financial sources for higher education. It specially focuses onself-finance education scheme experienced as a source of additional funding at public universities in Pakistan. University of Peshawar was taken asa case study. For this purpose, from a total number of 17 departments that were running the master level programmes at self-finance basis, 10 sample institutes were randomly selected for the study. Randomly selected 160 respondents in these 10 sample institutes were interviewed for taking in questionnaire. Of these 160 respondents, 96 were sclected from open merit students and 64 were selected from self-finance students. For the collection of information, two different comprehensive questionnaires were developed, one addressing to the students and the other to the staff of the institutions concerned. Results show that the students’ enrollments are increasing rapidly at higher education, specifically ie market-oriented and professional disciplines. There was a 52% positive growth in enrollments on self-finance basis during two years considered in the study. It was found that the students of both the shifts are equally punctualin class assignments and the teachers are unbiased in marking and equally regular in taking classes towards all the students in both the shifts. The major problems of boarding, transportation, availability of classrooms and the use ofcomputer labs were particularly felt by the self-finance students. The respondents with a strong socio-economic background were equally found among open merit self finance students, during the study. The study generally concludes that the introduction of self-finance education scheme at public universities brought a positive effect on the enrollment of the students and proved a big source of fundingfor the public universities. But it was foundthat on one side the open merit students were paying only 3000-10000 rupees for a professional degrecg. Contrarily, the self-finance students were paying 20000-50000 rupecs for the same degrees. Whereas the socio-economic background of both kind ofstudents was generally the same. Based on the conclusion it was recommended that the fee structure of the university needs changes. Higher education should not be fully subsidized and an average fee structure is suggested in this respect for students of both the shifts. Provision of scholarship to top 10% and financial help to very poor students is also recommended. It was also recommended that the infrastructural facilities should be increased to the level of increased enrollments. level of increased enrollmen
An Analysis of Governmental and Non-Governmental Rural Development Programmes with Particular Focus on Rural Women in NWFP (A Case Study of Three Union Councils in District Peshawar).
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 2006-07) Shaheen Nigar; Supervised by Prof. Dr. Arbab Ikramullah Khan
The aim ofthe present study was to examine the services of both government and Non-governmental organizations in North West Frontier Province (NWFP) Pakistan. For this purpose Peshawar of the NWFP was taken as a sample district. Govt. organizations are working throughout the province but NGOs existence is erratic. Their sizes and functions also differ widely. For the purpose of comparison a leading NGO namely Sarhad Rural Support Program (SRSP) was selected. The SRSP has launched its activities in different sectors and is actively involved in developmental works in the area. In addition to the secondary data, primary data were also collected. A total of210 females’ respondents were purposively selected. The findings ofthe study show that the people ofthe area are availing/utilizing the services of both the organizations i.e. government and of the NGO. The government organizations are investing more in the social sector while the NGO stress is on skill development. The government, social sector facilities are for the general public irrespective of the economic status while the NGO’s focus is on the poor community. However, both are benefiting the rural masses ofthe area. In so for as the social services are concerned the study finds that various social services provided by the government, are sparsely utilized by the women due to various socio-economic reasons. These include family responsibilities, ignorance and cultural taboos. In the health sector a numberof factors were found to be responsible for its underutilization. On the one hand, the health services were not easily accessible, poorly equipped and the medicine provided were of sub-standard and on the other hand majority ofrural women were poor and they could not afford expenses. In so far as the family planning services are concerned the poor popularity of family planning services was due to ignorance, non availability of required contraceptives and the influence oflocal religious leaders who consider that family planning was against norms ofIslam. Results of study show that NGO (SRSP) programme are more popular and effective among rural women. Women community organizations (WCOs) were established by SRSP and had been successfully working in the sample area. The sample women reported that they had been guided and motivated by SRSPstaff while establishing WCOs. The WCOs introduce those developmentalactivities that directly address the needs of the people. To enhance the income of local women, trainings were imparted in tailoring, embroidery, dyeing, poultry farming, fruit processing, bee keeping and Mushroom cultivation. All these activities insignificantly increase the income of the concerned women. However, the income of the dyeing was higher than that ofthe rest of the stated trainings. These entrepreneurship training encouraged womento start small business. Two levels (Rs. 5000 to 10000 —herein after called level 1- and Rs. 18000 to 20000 herein after called level 2) of credit were provided to communities for this purpose. Thecredits were mostly utilized for the purchase oflivestock and enterprise development. The income effect of level 2 credit wasinsignificantly higher than that of level 1. Similarly the income effect of enterprises was insignificantly higher than that of livestock. The majoreffect ofthe SRSP on gender related economic activities were the contribution of women in total household income. The study showed encouragingresults regarding increase in monthly income of the sample respondents, after the intervention of SRSP. The increase in monthly income of the sample respondents resulted in an increase in spending mainly on education and, health. Financial stability made them more confidents in decision-making. The study also identified the problem of inadequate amountofcredit and lack ofmarketing facilities, the provision of such facilities will ensure rural women’s empowermentand poverty alleviation at grass rootlevel. Some complaints were also registered by the member of the WCO’sregarding the duration of trainings because it was so short especially for the illiterate respondents that they could not take full advantage ofthese courses. It was also observed that at present there is little co-ordination between Government and NGO’s.It needs to be established and strengthened through mutual consultation, regular meetings and collaborationactivities. The study recommends increased coverage, representation of ethnic groups, need oriented approach, relaxed credit packages, strengthening of co-ordination between the line departments, proper monitoring, improvement in community infrastructure etc. Beside this special attention should be given to social sector by providing them adequate funds for building and other physical facilitates, qualified and well trained teaching andhealth personnel and also these services be madeeasily accessible to the rural communities. Marginal success of NGOs working maybe taken cautiously because NGO programmes depend on financing of donor agencies. When donor agencies withdraw hands NGOs programmes are in doldrums
THE DETERMINANTS AND FORECASTING OF ENERGY CONSUMPTION AND SUPPLIES IN PAKISTAN FROM 1972 TO 2010
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 2008) Fazal-e-Wahid; Supervised by Dr. Naeem-ur-Rehman Khattak
Pakistan faces severe energy crisis which has serious repercussion on different segments of economy. Proper identification of determinants of energy consumption and supply, and accurately forecasting of energy demand and supply is crucial for policy origination and proper implementation to overcome ongoing energy crisis. The present study focuses on to assess the determinants and forecasting of energy consumption and supply in Pakistan using timeseries data from 1972 to 2010. For the analysis ofunit root in data ADFhas been incorporated, Johansen co integration test, ECM are used to investigate the long and short run estimates ofthe required objectives, and ARIMA models were used to estimates the forecast their future values. The empirical results of the study reveal the existence of long run relationship among variables of interest and ECM technique confirms stable long run equilibrium on the basis of short run dynamics for all components of energy consumption and supply. It is found from regression results that GDP,industrialization, total vehicle registration, price of petroleum, price of gas, total energy import (coal) and cement production are statistically significant determinants of components of energy consumption, and total petroleum import, price of petroleum, technology, gross fixed capital formation, total electricity consumption, foreign direct investment, total vehicle registration and employment are statistically significant determinants of components of energy supply. Further the results of the study revealed that total energy consumption has strong and significant effect on economic growth of Pakistan. The forecasting results of ARIMA models suggest increasing gap between energy demand and supply from 2011 to 2025. Moreover, the study results suggest that energy consumption and supply are inelastic to economic activity and energy prices which mean there is need for economic deregulation and modification in energy market in the shape of privatization and liberalization. The finding of the study suggests that government and private sectors should inject more funds to energy sector in favor of technology and to enhance energy supply to meet increasing demands of energy.
An Analysis of the Impact of Government Budget Deficit on the Key Macroeconomic Variables in Pakistan 1960-2005 by Abdul Qayyum Khan
(Department of Economics, University of Peshawar., 2008) Abdul Qayyum Khan; Supervised by Dr. Naeem-ur-Rehman Khattak
The aim ofthis study was to achieve three main objectives. Firstly to analyze the impact of budget deficit on macroeconomic variables, secondly to analyze the effect of domestic bank borrowing and external borrowing on budget deficit and thirdly to analyze the causality among the macroeconomic variables. Annual data for the sample period 1960-2005, taken from Economic Surveys of Pakistan and International Financial Statistics was used. Simultaneous equation model was used to investigate the mechanism through which the monetary and fiscal impulses were channeled and then their effects were transmitted to other macroeconomic variables. The effects of increase in money supply due to borrowing from domestic banking system and foreign borrowingto finance budget deficit were channeled through private and public investment to other macroeconomic variables. Linear regression model was used to analyze the effect of domestic borrowing and external borrowing on budget deficit. The Vector Autoregressive (VAR) model was used to analyze the causality among the macroeconomic variables, using the impulse response function (IRF) and the error variance decomposition analysis. The stationarity of the time series data was checked by using Augmented Dickey-Fuller (ADF) test. Akaike Information Criterion (AIC) was used to select the optimum lag. Johansen Likelihood Ratio (LR)test was used to ascertain the cointegrationin the regressions used for analysis. Error Correction Mechanism (ECM)was used to analyze the existence of short term disequilibrium in the model. The study revealed that fiscal and monetary variables are important to determine the macroeconomic stability in Pakistan. The expansion in governmentcapital expenditure through money supply for two cases (short-term/long term) indicates that this policy in short term had no favorable impacts upon Pakistan economic development in terms of crowding-in effects. The rapidity of adjustment during the whole process towards long run steady state was very low. In the long-term this policy had favorable impacts on both private and public investment (crowding-in effects).The short-term and long-term policies both had favorable impact in terms of output development.It results in gain ofbetter internal performance in terms of consumption expenditure, capital expenditure and balance of trade. In short-term domestic outputs adjust previous discrepancy in the same period, and had the capacity to gain competitiveness and a better external performance. The short-term policies for foreign sector were uncertain. A short-term result indicates that frequent devaluation will not improve trade balance but would increase the cost of production. The long-term policies had favorable impact in terms of foreign sector development. Income elasticity of export was less than the incomeelasticity of import. Instead of having favorable impact of devaluation on foreign sector in long-term, Pakistan trade balance deteriorated in line with deterioration in foreign assets stocks. The employment generating capacity of output growth was low. Budget deficit financing in terms of borrowing from domestic banking system and foreign borrowing had almost the same capability of financing budget deficit, but the financing elasticity of foreign borrowing with respect to budget deficit was greater than one, indicating that Pakistan relies mostly on foreign borrowing for deficit financing, which results in foreign reserve outflows. Any innovation of one standard deviation towards economic growth and budget deficit took seven years for each one to become effective, while for unemployment it took eight years and for poverty reduction it took more than ten years to becomeeffective. The response of the four macroeconomic variables (Economic growth, budget deficit, unemployment, and poverty) to innovations or impulses introduced were mostly explained in their own. Only two unilateral causality were present, and mostly independent type relationships were detected. Based on the finding of the study it is recommended that government should give priority to long-term private/public investmentpolicies, which can gain better results in economic growth, poverty alleviation and unemployment reduction. Export sector needs more attention in terms of quality standard, price control, and internationally adopted marketing strategies. Parallel and effective running of monetary, fiscal and exchange rate policies are needed to reduce balance of payment deficit. Market based economy development, privatization, skill development, and merit based recruitment policies may also accelerate employment generating capacity of output growth. The existing fiscal policy needs alteration in terms of objective achievement and prolonged channels towards implementation. Multidimensional fiscal policies with coordination of monetary policy will be appropriate to combat all the macroeconomic evils. Domestic sources of deficit financing should encourage to deter foreign reserve outflows. Three Separate government policies in respect of budget deficit reduction indicates that the reduction in government expenditure (capital or consumption) exerts the most undesirable influence on the overall macroeconomic performance, and domestic source financing policy produces favorable impact compared to foreign borrowing financing. Hence, the reduction in government expenditure in order to reduce the budget deficit is not the best strategy and especially the policy of reducing government capital expenditure. The government expansionary monetary policy for budget deficit reduction would have somepositive effects on Pakistan’s economy, but the governmenthas to be conscious abouttheinflationary effects ofthis policy.
AN ANALYSIS OF SOCIO-ECONOMIC FACTORS AFFECTING FOREST AREA IN PAKISTAN WITH SPECIAL REFERENCE TO NWFP (1972-2000)
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 2008-01) Naila Nazir; Supervised by Prof. Dr. Ijaz Majid
This study was an attempt to analyze the socio-economic factors affecting forest area in Pakistan. Every year different areas are afforested and regenerated. Policies and programs are prepared to increase the forest area up to national requirements but there is no significant increase in the area rather fast deforestation is taking place. Forest communities play a significant role in the use and depletion of these resources. The study highlighted the assumptions about some macro economic variables, which are generally considered as key socio-economic factors that cause deforestation and depletion of forests and tested the hypothesis in order to show the impact of these factors on forest area in Pakistan. In order to achieve the objectives of the study and to test the hypotheses the followed methodology has two aspects; one, consulting the forest communities in forest rich areas of the province and second, analyzing the macro economic data of different socio economic factors that have impacts on the forest area of the country. For the first aspect two forest rich areas in NWFP; District Abbottabad and District Mansehra have been selected. The socio economic conditions of these areas have been discussed and analyzed. The priorities and practices of forest communities in the use of different resources have been checked. For the second aspect the study analyzed time series data of some of the socio-economic factors of Pakistan for example agriculture production, cultivated area, livestock and human population, the consumption of fuel wood substitutes etc. Taking the forest area of NWFP and forest area of Pakistan as a whole then checked the results of these socio-economic factors. For the analysis multiple regression technique was applied on the time series data from 1972-2000. The results of the econometric models were then compared with the primary information collected from the two districts of NWFP; District Abbottabad and District Mansehra. These results were further analyzed by comparing them with earlier studies conducted in the same field. The results of the primary data showed that most of the firewood and timber is extracted illegally and there is no official record or even a rough estimation of the total quantity illegally extracted. The most responsible figure as mentioned by the locals also includes Forest Department, which is a part of timber mafia. Forest department has no arrangement for forest fires; it is the locals who extinguish it by using local practices. The study area has not received real benefit of gas provision by the government in the country because these facilities are not yet extended to their areas and alternate sources are not enough. Both the study areas are suffering from some problems, which are contributing to deforestation, for example common property, lack of interest and cooperation of Forest Department with locals, lack of follow up of forestry programs especially started by foreign agencies etc. In both the areas there is no increase in animals so livestock population is not the prime threat. Human population has increased but they are either migrating to other areas or opting for service sector. In both the areas people have very little knowledge about government policies and programs. The results of the primary information showed some valuable facts about forest land conversion for other purposes, about Forest Department, the role of government and non-government organizations, about forest fires and about timber mafia in the study area. The results of the regression models obtained from the time series macro economic data showed that some of the socio-economic factors of the country that are generally considered as the most responsible factors for the depletion of forests such as increase in human and livestock population are not the important factors contributing towards deforestation in Pakistan but some others like cultivation, construction, consumption of timber and agriculture production are playing their due role towards deforestation. The study further showed that increase in the consumption of firewood substitutes could not significantly improve the situation. The analysis further showed the extent of effect of different variables on the forest areas. The recommendations of the study have given more emphasis to control the land use practices especially controlling land conversion for other purposes, proper demarcation of forest boundaries in Abbottabad and Mansehra districts to save from conversion and misuse, on regular basis the involvement of locals in plantation and giving incentives in cash and kind for plantation, provision of alternate energy resources in the study area especially to hill side forest communities, and proper follow up of the programs already launched in forestry sector to maintain the confidence of the locals. Further, since cultivation and construction activities are the main threat found in the study so more focused attention is needed in this regard and the general policy for addressing these problems would not work. To build up forestry data base is the prime requirement. The macro economic time series data of Pakistan is not accommodating illegal timber. So constructing an estimated time series data for actual fire wood and timber consumption including illegal extraction in Pakistan would be the future task based on the results of the present study that would give more robust results out of the present research.
Analysis of the Factors Determining Foreign Direct Investment and Economic Growth of Pakistan (1971-2005)
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 2009) Muhammad Azam Khan; Supervised by Dr. Naeem-ur-Rehman Khattak
The broad aim of the present study is to evaluate the influence of various economic, social and political determinants of host country in enhancing foreign direct investment (FDI). Further, an attempt has been madein this study to examine the impacts of domestic investment, foreign direct investment, human capital and trade openness on economic growth of Pakistan. For analysis secondary data has been utilized over the time period from 1971 to 2005, taken from Federal Bureau of Statistics, Pakistan Economic Survey and World DevelopmentIndicator various issues. Regression models have been used and the methods of Least Square, Two Stage Least Square, and Generalized Method of Moment have been applied as analytical techniques for the empirical estimation. In addition, Augmented Dickey Fuller test and Error Correction Mechanism areused to checkstationarity in the level of data. It has been argued that foreign capital inflow particularly in the form of FDIis likely to encourage national economic developmentin a host country by playing supportive role to local investment and by bringing many other benefits. FDI is the amountinvested by resident of a country in a foreign enterprise over which they have effective control. Almost two and half decades ago an excessive increase occurred in the global FDI inflow due to world globalization. Pakistan is a developing country and characterized by low per capita income, burden of external debt, lack of capital, low saving rate, rapid growth of population, and deficit in balance of payment etc. Domestic resources are short to finance the development needs of the country, therefore, FDI is one of the important sources of external finance for the economic developmentof Pakistan. Thus in order to have increased level of FDI in Pakistan, efforts has been made by the government of Pakistan by offering incentives to the investors in thecountry. But Pakistan has not yet enhanced desirable amount of FDI even offering many incentives to the investors. The empirical results of FDI economic modelin the presentstudy such as market size, infrastructurefacilities, domestic investment, trade openness, external debt and indirect taxes of the host country have been foundstatistically significant. But government consumption has been foundstatistically insignificant in the study. Similarly in the socio-political model a positive andstatistically significant relationship has been found between human capital and FDI inflows, while the result of political instability indicates though an inverse relationship with FDI but insignificant. For comparison, the study in hand comprised of one each econometric model for economic determinant of FDI for India and Indonesia respectively. The empirical results of India matched with the results of Pakistan excluding two determinates (viz, trade openness and government consumption) while the results of Indonesia do not match with the economic determinants of FDIfor Pakistan. The empirical result of the economic growth model indicates that expansion in domestic investment, trade openness and FDI promote economic growth but human capital has been foundstatistically significant with unexpected negative sign. In simultaneous equations model, from the economic growth equation,it has been foundthat the impacts of domestic investment, trade openness and FDI are statistically significant. Likewise the FDI equation indicates that FDI is positively related to growth rate, domestic investment and trade openness, while external debt negatively as expected. Therefore, on the basis of importance of FDI for boosting of economic growth,it has been concluded that to enhance more FDI into Pakistan, the management authorities may make efforts to improve Pakistan's image in the international community, ensure stable economic and political environment, provision of quality infrastructure, controlling inflation rate, peace and security, law and ordersituation and consistency in the governmentpolicies because these all are the key factors for potential investors in making investment choices. Thus to achieve higher levels of sustainable economic growth, improved living standard, alleviation of poverty, generating employment opportunities, socio-economic developmentand sustainable foreign investment- it is proposed, that the managementauthorities may give equal importance to follow appropriate macroeconomicstabilization policies (fiscal and monetary policies) accordingly.
Household Human Capital Investment Behaviour and Economic Growth: A Case Study ofKhyber Pakhtunkhwa (2001-2010)
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 2009) Amjid Amin; Supervised by Dr. Ijaz Majid
Economic Analysis of Staple Food-Grain Crops: Varieties' Input-Output Comparison, Economic Practices and Significance in the Economy of District Swat.
(Department of Economics, University of Peshawar., 2010) Anwar Hussain; Supervised by Dr. Naeem-ur-RehmanKhattak,
The present study aims to make economic analysis of staple food grain crops it. rice. Wheat and maize in district Swat. Out of the total seven tehsils, three tehsils namely Kabal. Matta and Barikot were selected on the basis of purposive sampling technique. The selected tehsils were situated on the bank of river Swat where food grain crops were mainly grown. From eachtehsil three villages euch were randomly selected. ‘The study is based on primary data which were collected through structured questionnaire using a sample of 200 farmers allocated proportionally. The respondents (farmers) were selected | randomly from each village. Sample size for the selected villages was adequate because the villages were quite homogeneous in terms of land condition, cropping pattern, population and farming activities. For the analysis, benefit-cost ratios, log-linear CobbDouglas production functions, stepwise regression and Waldtest were used. The findings of the study revealed that Fakhr-e-Malakand (rice variety with highest benefit-cost ratio of 3.41) was the most profitable variety as compared to all other rice varieties. Fakhr-e-Sarhad (wheat variety with highest benefit-cost ratio of 2.36) was the most profitable variety as compared to all other wheat varieties. Azam (maize variety with highest benefit-cost ratio of 2.24) was the most profitable variety as compared to all othermaize varieties. For rice crop, the outputelasticities ofarea, tractor hours, fertilizer, seed, labour and pesticides were 0.24578, 0.6712. 0.0789123. 0.871245. 0.12487 and 0.004871 respectively. For wheat crop, the output elasticities of area, tractor hours,fertilizer, seed, labour and pesticides were 0.61, 0.1220, 0.0789123, 0.871245, 0.12487 and 0.004871 respectively. For maize crop, the output elasticities of area, tractor hours, fertilizer, seed, labour and pesticides were 0.64123, 0.124587, 0.55461, 0.31244, 0.5874 and 0.08248 respectively. Proportional increase in the output ofrice, wheat and maize was faster than the increase in the inputs ofrice, wheat and maize respectively. The major pre and post harvest: agro-economic practices undertaken in food-grains crops cultivation were conservation oftraditional varieties, land preparation, water management, transplanting, harvesting and drying. threshing and cleaning. transportation and straw management. The villagers used to derive their standard of living from agriculture in general and particularly from food grain cultivation. The food grains were most closely connected with sources of income, labour force and capital employment, woman participation, labour distribution within the villages, food grain marketing, credit and financing, consumption pattern, price fluctuations, poverty alleviation, self-sufficiency, extension of markets, strengthening fertilizer business, mechanized farming, reduction in food grain shortages, children education, reduction in the social problems, extension in tractors and threshers market. increasing livestock production and reduction in the prices of those commodities which requires food grain as raw material. The per acre usage of labour for rice. Wheat and maize was 55, 30 and 35 labours respectively. Majority of the food rowers used to sell their produce in the village markets. The farmers mostly used non-institutional loans for farm activities. It is recommended that the government should launch policies for increasing cultivated area under food crops. Awareness should be given to the farmers to grow profitable varieties rather than traditional varieties. The farmers should only use recommended seed. Proper storage facilities should be provided to the food grain growers. Efforts should be made to increase farmers’ income through improvements in food grain quality, plus better utilization of its by-products. As proportional increase in the output of food grain crops was higher than their inputs, therefore, the inputs should be properly and efficiently managed so as to ensure higher productivity.
FOREIGN CAPITAL INFLOWS AND ITS IMPACT ON MACROECONOMIC VARIABLES IN PAKISTAN 1981-2010
(Department of Economics, University of Peshawar. Khyber Pakhtunkhwa, Pakistan, 2010) Safia Gul; Supervised by Dr. Naeem ur Rehman Khattak
Foreign capital inflows (FCI) help under-developing countries to cover the gap of twin deficits in current and capital accounts by increasing the size of their Gross Domestic Products (GDP), improving the quality and quantity of technological domestic means of production, creation of employment, transformation of industrial base for exports orientation and imports substitution to gain favorable Terms of Trade (TOT) and Balance of Payments (BOP) position by changing the composition of current and capital accounts. Pakistan has strong potential if the determinants involved in the transformation of the agrarian structure of the economy to mechanized industrialization improve to induce more foreign investors in capital intensive projects by creating financial co-relation with domestic investors as the country has low access in the international resource markets of invisible items. Foreign Inflows of portfolio investments direct enhances foreign exchange reserves. Aim of this study to explain various factors involved to have more FCI and its impact on macroeconomic indicators like, Growth, Domestic Investment, Inflation and Trade Balance. Trend and Regression Analysis applied to evaluate thirty years secondary data collected from various sources. This Study focused on two Determinants of FCI i.e. 'Foreign Direct Investment' (FDI) and 'Foreign Portfolio Investment' (FPI). For checking interdependency of variables in six separate models are specified taking different macro-economic variables. Before analyzing the Time-Series data, Augmented Ducky Fuller test (ADFT) used to check stationarity of the data of those variables in models. For checking Non-Stationary data by Unit-Root showed that all the variables are not stationary at level but stationary at the first difference. For the analysis of variation in variables and finding long-run relationship, "Johansen’s Co-integration-Test” applied. For detection of short-run impacts of FCI on the selected variables in models "Vector-Error-Correction-Model" (VECM) used. Moreover, for examination of the inter relationship in the FCI with economic growth, domestic investment, consumption and inflation; Granger Causality Test (GCT) applied. For deriving the results, SPSS and E-views utilized. Major findings of the study showed that GDP growth rate positively and significantly affects (0.147) FCI and negatively affected (-0.033) by the inflation rate in the country. FCI affected positively (0.195) by the interest rate. Exchange rate is positively related (0.027) to the FCI. Domestic investment affects positively (0.545) FCI. GDP growth rate positively affects (0.157) FDI. FDI negatively affected (-0.001) by the inflation rate of the country. FDI is affected positively (0.015) by the interest rate of the country. Exchange rate positively related (0.030) FDI. Domestic investment affects positively (0.295) FDI. Exports affect FCI positively (0.008). GDP growth rate positively affected (1.083) by FDI in the country. GDP growth rate positively affected (0.021) by the persistent rise in the general price level (inflation) of economy. Gross-Domestic-Product (GDP) growth rate affected negatively (-0.080) by the interest rate of the country. FDI positively affects (1.479) the domestic investment of the country. Domestic investment positively affected (0.284) by FCIs. Inflation rate is positively affected (0.157) by the foreign direct investment to the country. FCI affect the inflation rate positively (0.467). FCIs affect the balance of trade negatively (-0.127). The coefficient is significant at 5% levels of significance. Balance of trade positively affected (0.127) by the GDP growth rate of the country. The balance of trade affected positively (0.237) by the relative prices of imports. Balance of trade negatively affected (-0.132) by the relative prices of exports. Foreign exchange reserves and exchange rate affects the balance of trade negatively. Similarly, as the currency depreciates, the exports become less expensive and hence the demand for exports increases in the international markets. Increase in exports lead to improve balance of trade. Incentives should be given to domestic investors to boost GDP and exports. The study revealed that inflation rate; imports volume affects the FCI negatively and has insignificant impact. So the government should control inflation through monetary/fiscal policy and reduce the imports of un-necessary items through restrictions or imports substitution and export orientation.

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