Abstract
This paper explores the relationship between export growth and economic growth in the
case of Pakistan by employing time series data for the period 1971- 2013. This study
has incorporated variables like GDP (Gross Domestic Product) exports, imports and
Foreign Direct Investment (FDI). We have applied ARDL to co-integration and Error
Correction Model (ECM). The study provides the evidence of stationary time series
variables, the existence of the long - run relationship between them, and the result of
ECM revealed short rum equilibrium adjustment. Pakistan has many options for
enhancing the export of the country. There is a dire need to minimize trade barriers and
restrictions such as import and export quotas. Government of Pakistan had introduced
Structural Reforms for liberalization, privatization and de-regulation which will
actually shifted the trend of trade at a significant level in the end of 1980s. Low levels of
interest rate can help exportable industries in which investments are needed to promote
and enhance the exports. Stable exchange rate is the first and the best policy option for
increasing the export and managing the imports. There is a cause and effect
relationship between exchange rate and FDI. Pakistan has to immediately find the
policies and processes that support logistics and facilitates trade.
Nooreen Mujahid, Azeema Begum, Muhammad Noman. (2016) IMPACT OF TRADE ON ECONOMIC GROWTH OF PAKISTAN: AN ARDL TO CO-INTEGRATION APPROACH, Journal of Social Science and Humanities, Volume 55, Issue 2.
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