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UNIVERSITY OF CENTRAL PUNJAB

Business Taxation

Submitted by; - Afrasyab Shafiq, Fahad Zia, Abdul Wadood, Bilal.

Registration#; - 0005BS, 0001ADP, 0010BS ,0011BS

Section; - AD/BS (Commerce)

Submitted to; - Prof. Zubair

Date: - 18-07-2019

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Contents
CPEC: - ........................................................................................................................................... 2

Benefits of CPEC to Pakistan: - ...................................................................................................... 3

Kyrgyzstan ...................................................................................................................................... 3

Main industries of Kyrgyzstan: - .................................................................................................... 4

Agriculture: - ................................................................................................................................... 4

Fishing: - ..................................................................................................................................... 5

1. Forestry: - ............................................................................................................................. 5

2. Mining: - .............................................................................................................................. 5

3. Manufacturing: - .................................................................................................................. 6

Current situation in Kyrgyzstan: -................................................................................................... 7

Is Kyrgyzstan a rich or poor country? ......................................................................................... 7

Pakistan exports: - ......................................................................................................................... 10

Top 10 exports of Pakistan: .......................................................................................................... 10

TOP 10 exports countries of Pakistan: - ....................................................................................... 11

Pakistan export footwear to Kyrgyzstan through CPEC: - ........................................................... 12

INFRASTRUCTURE FACILITIES: ........................................................................................ 12

PAKISTAN export farther goods through CPEC to Kyrgyzstan .............................................. 12

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CPEC: -
CPEC is intended to rapidly modernize Pakistani infrastructure and strengthen its economy by the
construction of modern transportation networks, numerous energy projects, and special economic
zones. ... Pakistan's railway network will also be extended to eventually connect to China's
Southern Xinjiang Railway in Kashgar

Benefits of CPEC to Pakistan: -


 It’s a project worth $62 Billion.
 It provides a much-needed base for Pakistan to kick start its economic growth.
 More job opportunities will be created and trade between China and Pakistan will improve
leading to GDP growth of Pakistan.
 It will modernize the Pakistan infrastructure and transportation facilities

Kyrgyzstan

From 1917 to 1991, the Kyrgyz lived in the Soviet Union as residents of the Kirghiz Soviet
Socialist Republic. With the collapse of the Soviet Union, the Kyrgyz people became independent
and created their own country. Since 1991, Kyrgyzstan has been led by an elected president and
parliamentary form of government.

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Main industries of Kyrgyzstan: -


Kyrgyzstan is a landlocked country in Central Asia characterized by mountainous terrain. It has
been at the crossroad of several great civilizations as part of the Silk Road and other cultural and
commercial routes. Since gaining independence from the Soviet Union in 1991, Kyrgyzstan has
endured ethnic conflicts, political conflicts, economic troubles, revolts, and transitional
governments. All these factors have worked together to slow down the market reforms in places
such as land reforms and improved regulatory system. Corruption, regional instability, and low
foreign investments have also hindered the country’s economic performance. However, despite
the challenges the country is currently facing, Kyrgyzstan is ranked 70th on the ease of doing
business index (2013). The economy relies heavily on the country's natural resources and is
dominated by the agricultural sector with tobacco, cotton, wool, and meat as the main agricultural
products. Here are Kyrgyzstan’s major industries and their contribution to the country’s economy.

Agriculture: -
Agriculture is the backbone of the economy of Kyrgyzstan, employing about 48% of the country’s
workforce and accounting for 20% of the total GDP. It also provides a refuge for workers who
have been displaced from other industries. Although agriculture is the most important industry in
Kyrgyzstan, only 7% of the total land area is under crop cultivation and another 44% is used as
pasture for livestock. The country is mainly mountainous (including the Pamir Mountains and Tian
Shan Mountains) and agriculture is mainly centered in the Talas Province, Chuy Province, and
Ferghana Valley. The major agricultural crops produced in Kyrgyzstan include potato, cotton,
tobacco, vegetables, and fruits. Following a sharp reduction in the 1990s, the country witnessed a
significant increase in subsistence farming in the 2000s. Grain production and livestock grazing
account for the largest share of the agricultural workforce. Most farmers are also shifting from
cotton and tobacco to grain farming. Private household plots are responsible for 55% of
agricultural output while private farms account for 40%. The rest of the output is from state-owned
farms. Despite the significant role played by the agricultural sector, it has been slow to
modernization since the fall of communism and the growth experienced has not been sufficient to
reduce poverty. Poor agricultural practices have resulted in the degradation of agricultural land.
Land reforms remain a controversial issue in Kyrgyzstan and have proceeded at a slow pace since
1998.

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Fishing: -
Although Kyrgyzstan is a landlocked country with no access to major water bodies such as seas
and oceans, fishing remains an important part of the national economy. Fisheries resources are
mainly obtained from the lakes such as Kara-Suu, Son-Kul, and Issyk-Kul, and large reservoirs.
Like most of the sectors of the economy, the fisheries sector was also greatly affected by
Kyrgyzstan’s withdrawal from the Soviet Union. The production decreased from 950 tons in 1988
to only 131 tons in 2000. However, the country has the potential to produce 1,500-2,000 tons of
freshwater fish per year. The country has about 700,000 hectares of natural ponds, 3,400
kilometers of rivers, and a reservoir with a total area of 5,800 hectares. All these water bodies
provide a perfect environment for aquaculture development. With the growing economy and
demand for an alternative source of protein, the demand for fish has significantly increased. The
fishing industry is expected to be a major source of income, food, and employment for most
households in Kyrgyzstan once it fully transitions from centralized to a market economy.

1. Forestry: -
About 954,000 hectares or 5% of Kyrgyzstan is forested. Of the forest cover, 28% is classified as
primary forest while about 57,000 hectares is planted forest. Between 1990 and 2010, Kyrgyzstan
gained about 14% of forest cover. Although the country has a small forest cover, the forests are of
great socio-economic value to the people. They are sources of firewood for cooking and raw
material for industrial processes such as paper making. Kyrgyzstan has the largest wild growing
nut forest in the world. Other types of forests include conifers, riparian, and juniper forests. These
forests contain a total of 56 million metric tons of carbon. Kyrgyzstan’s forest industry is
confronted by a number of challenges including lack of timber imports, illegal logging of wood,
and overgrazing.

2. Mining: -
Mining in Kyrgyzstan dates back to the 3rd and 4th centuries when several sites were excavated
for minerals such as copper, iron, lead, gold, mercury, and silver. The country has a number of
minerals and extraction plants, especially in the southern part of the country. The key minerals
include iron ore, aluminum, copper, gold, silver, and mercury. There are also deposits of oil and
natural gas in Kyrgyzstan. All the output of the mineral sector is exported. The gold resources
from the Kumtor gold mine are refined at Kara-Balta Mining Plant and thereafter exported to the

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western market. The gold mine is one of the largest in the world. Based on world prices,
Kyrgyzstan’s mining industry is valued at US$ 73 million with coal production accounting for
US$29 million. The most profitable area of the mining and mineral sector is gold extraction.

3. Manufacturing: -
In the post-soviet era, the manufacturing industry suffered a sharp reduction in its production
because of the disruption of the supply of raw material and energy. The disappearance of the Soviet
market also contributed to the decline of the industry as industrial products lacked market.
Although the manufacturing industry has not fully recovered, its role in the nation’s economy
cannot be ignored. The major components of this industry include textile and clothing, food
processing, mineral processing. Kyrgyzstan has been home to several garment making companies
with the garment industry growing by over 1100% since 2014. Most garment making companies
operate as cut-make-trim garment manufacturers. The estimated garment industry production is
currently at $375 million and accounts for about 7% of the total export. About 300,000 people are
employed in the sector (12% of the total workforce). The challenges faced by the textile industry
in Kyrgyzstan include lack of access to finance and underdevelopment capacity to meet the market
demand.

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Current situation in Kyrgyzstan: -

Is Kyrgyzstan a rich or poor country?


Kyrgyzstan was the ninth poorest country in the former Soviet Union, and is today the second
poorest country in Central Asia after Tajikistan. 31.7% of the country's population lives below the
poverty line. Kyrgyzstan is undoubtedly a low-income country as it has the second lowest Gross
National Income (GNI) in Europe and Central Asia and 32 percent of the population lives below
the poverty line. ... Kyrgyzstan is only able to export cotton and tobacco as the country has few
natural resources desired by the rest of the world.

Imports of Kyrgyzstan

Total Imports (2017) $4 billion dollar

Imports of goods and services (% of GDP) (2017) 66.79%

Top 10 Import Countries of Kyrgyzstan

Country Import USD$

China $1,493,693,988

Russia $1,180,319,816

Kazakhstan $585,815,585

Turkey $224,851,850

Uzbekistan $163,617,706

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Country Import USD$

United States $155,220,185

Belarus $83,118,195

Germany $67,487,371

South Korea $46,365,779

Ukraine $38,889,551

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Top 10 Import Goods of Kyrgyzstan

Import USD$

Oil & Mineral Fuels $636,264,785

Industrial Machinery $364,252,449

Footwear $301,250,037

Electrical Machinery $254,370,668

Manmade Staple Fibers $192,432,573

Pharmaceuticals $168,715,078

Apparel: Knit $156,797,709

Motor Vehicles & Parts $148,047,466

Iron & Steel $144,558,929

Plastics $133,480,898

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Pakistan exports: -
Pakistan is the 68th largest export economy in the world and the 98th most complex economy
according to the Economic Complexity Index (ECI). In 2017, Pakistan exported $24.8B and
imported $55.6B, resulting in a negative trade balance of $30.9B. In 2017 the GDP of Pakistan
was $304B and its GDP per capita was $5.53k.

Top 10 exports of Pakistan:

2018 Value
Rank Pakistan's Export Product Change
(US$)

1 Linens $3.2 billion +3.4%

2 Men's suits, trousers (not knit or crochet) $2.2 billion +9.7%

3 Rice $2 billion +15.7%

4 Yarn (85%+ cotton) $1.2 billion -0.1%

5 Woven fabrics (85%+ cotton) $969.6 million +3%

6 Woven cotton fabrics $626.2 million +12.4%

7 Leather clothing, accessories $614.9 million +4.7%

8 Men's suits, trousers (knit or crochet) $567 million +20.6%

9 Men's shirts (knit or crochet) $508.9 million +1.5%

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2018 Value
Rank Pakistan's Export Product Change
(US$)

10 Miscellaneous articles, dress patterns $481.4 million +8.9%

TOP 10 exports countries of Pakistan: -

Countries Value

United States $3.56B

United Kingdom $1.63B

China $1.51B

Afghanistan $1.39B

Germany $1.29B

Spain $904.57M

United Arab Emirates $869.05M

Netherlands $758.22M

Italy $703.34M

Belgium $700.69M

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Pakistan export footwear to Kyrgyzstan through CPEC: -

Pakistan exports footwear to more than 60 countries in five continents of the world. Its major
exports are to UK, France, Netherlands & Germany in Europe and Dubai, Saudi Arabia & Yemen
in the Middle East. Pakistan’s exports of footwear have registered a high rate of growth in the
recent past. It has gone up by 250% of what it was few years ago.

INFRASTRUCTURE FACILITIES:
Superb communication facilities of transportation are available in the country by road / rail / air
network. We have fully developed seaports like Karachi & Port Qasim, while Gwadar seaport is
going to be in full swing very soon. Bulk supplies take only three weeks’ time to be delivered in
Europe by sea route.

Islamabad, Lahore & Karachi international airports handle all types of cargo. Many cities are
linked with dry ports facilitating cargo shipments. Modern telecommunication facilities are
available down to small towns.

PAKISTAN export farther goods through CPEC to Kyrgyzstan


Oil & Mineral Fuels, Industrial Machinery, Footwear, Electrical Machinery, Manmade Staple
Fibers, Pharmaceuticals, Apparel: Knit, Motor Vehicles & Parts, Iron & Steel, Plastics

From this Pakistan get Approximately 2.5 billion dollars of business.

https://www.scribd.com/document/418675946/CPEC-and-Kyrgyzstan

Kyrgyzstan