ISLAMABAD, November 28: Prime Minister, Zafarullah Khan Jamali, has constituted a 25-member special committee to improve investment climate in the country and rebuild investor-confidence on war-footings.

Official sources told Dawn that the prime minister would himself be the chairman, and Industries minister Liaqat Ali Khan Jatoi, vice-chairman.

The committee comprised four provincial governors and ministers for commerce, finance, petroleum, water and power, information technology, privatization commission, besides chairman of board of investment, and president of federation of Pakistan chambers of commerce and industries (FPCCI). Some leading industrialists and private sector professionals would also be part of the special investment committee, these sources said.

The committee would consult all stakeholders for the formation of short, medium and long-term policy recommendations that could revive investor’s confidence in the country that has been shattered due to a series of events since 1997.

Pakistan’s potential to attract foreign direct investment (FDI) has improved marginally from 141 points in 1990 to 159 points in 2000, but its relative performance to secure FDI has reduced significantly from 6 points to 2 points.

FDI to Pakistan reduced from $530 million in 1999 but declined to $305 million in 2000 and improved to $385 million in 2001. As percentage of gross capital formation, the $530 million FDI was 6.7 per cent which had reduced to 3.9 per cent in 2001.

Pakistan’s foreign direct investment (FDI) total stocks since 1980 until now amounted to $6.896 billion in 2000, but reduced to $6.698 in 2001. In the world ranking of 140 countries, Pakistan got 114th position in terms of investment potential and performance.

Board of investment officials attribute improvement in investment potential in terms of attractiveness to the political stability and economic outlook but did not elaborate the reasons why this potential could not be materialized.

They, however, claimed that new initiative like information technology parks, industrial clusters and export processing zones have been taken to tap this potential.

FDI flows to the developing economies of Asia and pacific declined by 24 per cent last year to $102 billion, down from $134 billion in 2000, according to World Investment Report 2002.