Lets go back to the basic, why Pakistan economy does not grow steadily despite huge resources while Bangladesh shows more resillient than Pakistan. The answer is simple and a one liner. Bangladesh economy is self driven while Pakistan economy is imposed. Pakistan economy still based on huge governement spending. As long as governemnt spend economy grows. Pakistan private investment is very low compared to their GDP. If we go back to year 2007-8 when Pakistan was growing at faster pace (7-8%
, the then private investment to GDP was only 13% and Government spending was more than 11%. That means almost half of the investment came from Government spending (The figure i recalls from my memory so may not be precise). Also the growth was somewhat depndent on FDI and portfolio investment. Service and financial sector got the highest amount of FDI. On the contratry in Bangladesh the growth is mainly driven by private domestic investment. 19% of the GDP invested from private sector and only 5% came from government spending. There is almost negligible FDI. That is the main reason Pakistan growth did not sustain but BD did and it will. Unless Pakistan could go back to the basic and does some homework then it will never be able to catch up with BD. BD economy will grow in higher speed as soon as government start spending and the investment/GDP ratio raised to 30% of GDP which will be in 2 years time. Private sector investment needs to be raised little bit to 22% and some FDI that is on pipeline on big infrastructure project like electricity generation, highways, port, airport etc and when hit the ground then the investment/GDP ratio will be raised to 33 to 35% which is needed for double digit growth rate. Its not dream anymore but reality. Can Pakistan raise the investment scenario to BD level in short term? Hard task indeed...