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Pakistan better for outsourcing than India or China, says Aziz

LONDON: Prime Minister Shaukat Aziz has urged Western companies to outsource jobs to Pakistan and use it as a manufacturing hub to make cheap goods.

“Pakistan has a stable political environment, and is a better place for western companies to outsource than India or China,” the prime minister said in an interview with John Waples of The Sunday Times, a leading British newspaper,

“Use Pakistan as a regional hub for manufacturing and then export, because the location is unique. The challenge now is one of implementation and making things work better. The Pakistan of today and tomorrow is not the Pakistan of yesterday,” the paper quoted Aziz as saying.

“When the world was taking off in the 1980s and 1990s, we were busy with internal politics. This did not provide the continuity that a developing country needs,” he said.

The report said the Pakistani government is going all out to persuade western businesses to use the country’s cheap labour and land to make money.

This year Pakistan’s exports are set to hit $ 14 billion and President Pervez Musharraf is predicting that GDP growth will rise from 6.7% to 7.5%. Last Wednesday evening, he told delegates at the Expo 2005 that 700 foreign companies were operating in Pakistan, and they were all making double-digit returns - some were making 50%. He said the hourly labour rate is only $0.37 in Pakistan, lower than India ($0.58) and China ($0.67).

Foreign investment, led by the US and Britain, in Pakistan has been growing at 100 percent a year, the newspaper said. Pakistan has just issued its second international bond, this time raising $600m, an issue that was two times oversubscribed. The Karachi stock exchange was the best-performing exchange in 2003 and last year it rose a further 50%.

The report gives examples of foreign investment in Pakistan, such as a Manchester firm called Drillcorer that has just moved production of its drills to Pakistan. Honda is moving two motorcycle factories to Pakistan. For the past two years Pakistan’s manufacturing sector has being growing at more than 15% a year. app

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