Abstract:
This paper reviews the trends of two types of foreign capital
inflows, namely foreign aid and foreign private investment, to Pakistan.
Like other developing countries, the volume of foreign aid to Pakistan has
been decreasing. Meanwhile foreign private investment to Pakistan has
increased, though not as sharply as that to other developing Asian
countries. The study finds that the impacts of foreign capital, aid and
private investment on the economic performance of Pakistan have been
insignificant. This paper suggests that these consequences are due to the
inadequate development of domestic institutional structure, human capital,
and indigenous entrepreneurship.
