and packaging of products would further stimulate export of these products to the neighboring middle eastern markets. with a strong base of economically active population, pakistan has an edge as it is a low wage economy – average wage is close to $ 75 - $ 100 a month for unskilled workers, $ 100 - $ 200 for skilled and for managerial workers, it ranges from $ 200 - $ 500 a month. to enhance skills, an aggressive technical education and skill development program exists under the medium term development framework. investment climate will benefit further from the ongoing efforts and strong commitment to rule of law, developing a competent and efficient government sector, less cumbersome regulations and control of corruption. the overall poverty has reduced from 34. 46 % in 2001 to 23. 90 % in 2005. the percentage of population living below the poverty line in rural areas has declined from 39. 2 % to 28. 1 % while that in urban areas has declined from 22. 7 percent 14. 9 percent. in other words, rural poverty has declined by 11. 2 percentage points and urban poverty has reduced by 7. 8 percentage points. finally, besides banking sector, the large financing requirements of infrastructure and of agriculture sector ( ranging above rs130 b ) can be met but require financial diversification. the long - term domestic debt market is still under - developed and corporate debt issues account for less than 1 % of gdp. similarly, pakistan boasts an extremely liquid equity market but it remains dogged by high degree of speculative transactions that have led to periodic bouts of instability and claims of market manipulation. given the importance of long - term debt markets to support investment, particularly in infrastructure projects, to increase domestic savings, and improve the risk profile of commercial banks ( which currently face mismatches in lending and deposit profiles ), pakistan needs to foster development of long - term institutional savings industry ( pension and provident funds, mutual funds, etc. ), implement capital market reforms aimed at encouraging investment rather than speculation, and improve risk management in the financial sector to ensure financial sector stability. conclusion in conclusion, pakistan offers endless possibilities with its vast untapped resources. the country is set to grow at a rate of 7 % per annum which should help to further raise its per capita income from us $ 847 per annum to us $ 1557 by 2015. demand is expected to get stronger as incomes rise further and assuming current population growth trends persist. pakistan ’ s strategic geopolitical position, due to its proximity to india and

early warning indicators and models. the most effective tools for dampening credit cycles seem to be the so - called borrowerbased instruments, such as caps on borrowers´ loan - to - value ( ltv ), loan - to - income ( lti ) and debt - service - to - income ( dsti ) ratios. fixed caps on these ratios, applied in many countries, are certainly useful. but ideally, the macroprudential authorities should have powers to adjust these ratios, if necessary, in a counter - cyclical fashion. of course, that will be challenging : a discretionary use of borrower - based instruments is politically highly sensitive, which may lead to an inaction bias. high - quality analysis and research can help the policy - maker to overcome this bias : politically sensitive decisions can only be based on sound indicator - and model - based macroprudential analysis. the more confident the policy - makers are on the quality of analyses, the easier it is for them to decide ( i ) when to deploy macroprudential tools, ( ii ) which tools to use and ( ii ) how to calibrate them. high - quality analysis and research will also help policy - makers to assess the impact of different macroprudential measures on lending, asset prices and economic activity. for a similar view, see e. g. blanchard ( 2015 ) ten takeaways from the “ rethinking macro policy : progress or confusion? ” http : / / www. voxeu. org / article / rethinking - macroeconomic - policy - introduction. bis central bankers ’ speeches macroprudential policies in the euro area [ slide 7 ] let me now briefly discuss macroprudential policies in the euro area, where the macroprudential framework is special with complementary roles for national macroprudential authorities and the ecb. in this environment, there are also special needs for macroprudential analysis and research. in the euro area, as elsewhere, national authorities bear the main responsibility for national macroprudential policies. they are always in the best position to detect country - specific systemic risks and to take appropriate measures to address them. these national policies are organized differently in different countries. in finland, for example, the designated macroprudential authority is the financial supervisor, the fin - fsa. in many euro area countries, however, the national macroprudential authority is the central bank or a council of