Liberal Economic Policy of Ayub Khan

The economic liberalization of Pakistan is about how Ayub Khan started to promote the economic independence and development of the economy of Pakistan. The main goal was to increase the GDP growth for the betterment of the country. After the martial law was imposed by Ayub khan, he introduced the 1962 constitution which promoted extreme levels of economic liberalization. The reforms were widely criticized by the population, but much supported by the USA. These policies were moulded under the idea of capitalism and the idea of Free- Market economics. This created an environment where the private sector was encouraged to establish medium and small-scale industries in Pakistan. All this lead to new job opportunities, kicking up the GDP. Agricultural reforms were introduced and an oil refinery was also set up in Karachi. A major development credited to Ayub khan known as the green revolution was a huge step forward in the country’s self sufficiency in food. Agriculture growth rate rose to a peak of 6.3% annual rate. Record wheat and rice productions were recorded. Political stability, liberalization of investment controls and ample availability of foreign exchange were key factors influencing a pronounced acceleration in the pace of private investment. The policies were made less strict for private investment. His government also took several steps to keep the rising prices in check. In order to attract foreign investments he also set up the Investment Promotion Bureau. Schemes such as the Export Bonus Scheme and Open General licensing scheme also played a vital role in the economic uplift of the country.