New prospects in is­land na­tion

Enterprise - - Contents -

Over 1,000 trop­i­cal is­lands in the In­dian Ocean make up the Repub­lic of the Mal­dives. These is­lands are the main source of in­come for the coun­try. Mal­dives has suc­cess­fully mar­keted its nat­u­ral as­sets through pro­mot­ing cul­tural tourism, which con­trib­utes nearly 29 per­cent to the to­tal GDP, along with a con­sid­er­able share ob­tained from fish­eries. In­ter­est­ingly, the ma­jor de­vel­op­ment in these is­lands is brought about by For­eign Di­rect In­vest­ments.

Mal­dives fol­lows a non-aligned pol­icy and main­tains friendly re­la­tions with all the ma­jor global economies. As a re­sult, FDI from In­dia, Sri Lanka, Amer­ica and Europe has con­trib­uted tremen­dously to the con­struc­tion, com­mu­ni­ca­tion and trans­porta­tion sec­tors of the econ­omy. Pak­istan has no pres­ence in these is­lands. How­ever, as part of grow­ing bi­lat­eral ties be­tween Pak­istan and Mal­dives, the is­land na­tion is of­fer­ing Pak­istan a num­ber of its trop­i­cal is­lands for in­vest­ment. The po­ten­tial op­por­tu­ni­ties avail­able to Pak­istan in­clude: Tourism in­dus­try - de­vel­op­ment of ex­otic hol­i­day re­sort is­lands Prop­erty de­vel­op­ment in cap­i­tal Male and nearby is­lands Air and sea trans­porta­tion Marine-based in­dus­tries such as fish pro­cess­ing, aqua­cul­ture and marine cul­ture In­fra­struc­ture de­vel­op­ment Buy out shares in ex­ist­ing busi­nesses In­vest­ment par­tic­i­pa­tion in new com­pa­nies Ser­vices sec­tor of­fer­ing re­sort man­age­ment; sea and air trans­porta­tion; ac­count­ing and man­age­ment and man­u­fac­tur­ing.

Out of the 1,190 is­lands only 200 are in­hab­ited while the rest have been opened to for­eign in­vestors. Pak­istan has been of­fered to in­vest in and con­struct re­sorts, guest­houses and 2-3 star ho­tels. The av­er­age oc­cu­pancy rate of these re­sorts is guar­an­teed to be nearly 70 per­cent as Mal­dives is grow­ing to be a tourist hub in the South Asian re­gion. In the pre­vi­ous year alone, as many as 700,000 tourists from dif­fer­ent coun­tries vis­ited the Mal­dives, giv­ing a boost to the econ­omy that re­lies heav­ily on tourism.

Ba­si­cally Mal­dives lacks in­dige­nous re­sources. The level of tourism of­fers great po­ten­tial of Pak­istani ex­ports to Mal­dives in many ar­eas, as the present value is at around $6 mil­lion. The poor soil and scarce arable land have lim­ited agri­cul­ture to a few sub­sis­tence crops such as co­conut, ba­nana, bread­fruit, pa­payas, man­goes, taro, be­tel, chillies, sweet pota­toes and onions. Al­most all food, in­clud­ing sta­ple items, has to be im­ported to feed the grow­ing num­ber of tourists. There­fore, Pak­istan has the op­por­tu­nity to eas­ily cap­ture a faith­ful mar­ket for its agri­cul­tural crops, es­pe­cially rice.

Con­struc­tion ma­te­ri­als from Pak­istan like silt, ce­ment and mar­ble are also im­ported by Mal­dives and con­sid­ered to be of high qual­ity. Re­cently, Pak­istan in­stalled a ce­ment plant in Mal­dives and has of­fered to ex­port con­struc­tion items to the coun­try without quota.

Ne­go­ti­a­tions over a di­rect con­sign­ment line from Karachi to Mal­dives in­di­cates an ef­fec­tive strat­egy to­wards boost­ing trade links. The pro­duc­tive di­a­logue be­tween the two coun­tries re­veals that Pak­istan does not want to limit bi­lat­eral re­la­tions to tourism, fish­eries and con­struc­tion only, but plans to ex­tend tech­ni­cal as­sis­tance as well.

The role of Trade De­vel­op­ment Au­thor­ity of Pak­istan and Cham­bers of Com­merce is cru­cial in achiev­ing suc­cess­ful trade, as the Mal­di­vian gov­ern­ment is also will­ing to or­ga­nize an ex­hi­bi­tion, es­pe­cially for show­cas­ing Pak­istani prod­ucts. In ad­di­tion, Mal­dives will be host­ing the 17th South Asian As­so­ci­a­tion for Re­gional Co­op­er­a­tion ( SAARC) this year. This will be ben­e­fi­cial for re­gional eco­nomic co­her­ence. All these strate­gies will over­come the ear­lier trade deficit due to the ge­o­graph­i­cal dis­tance Pak­istan and Mal­dives and will en­able Pak­istan to com­pete with the long held dom­i­nance of Sri Lanka and In­dia over the mar­kets of the is­land na­tion

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