Literature Review

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  • Topic: September 11 attacks, Economics, Value added
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  • Published : March 14, 2011
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Literature Review:
Effects of 9/11 on Pakistan’s Textile Industry

Submitted to: Mr.Amir Baig
Submitted By: Waleed Nasir
BS-ECO 2k9
Pak-US relations have remained unpredictable ever since the 9/11 attacks. The literature review the effects of September 11 attacks on Pakistan’s textile trade entails analysis of reports, articles and online magazines. The secondary research gave an insight on how applicable and imminent the research hypothesis is and in what aspects the terrorist attacks affected the textile industry.

The first article reviewed is by Robert Looney, an author from Strategic Insights (a group of analysts who monthly publish articles on economics) states in his article “Problems in using trade to counter terrorism: The Case of Pakistan” that Pakistan’s relations with US has affected the overall economy. After 9/11 US decided to alter it’s a foreign policy that favored Pakistan’s economic growth because a stable economy would prove to be a barrier against terrorism. According to Looney the neoclassical comparative advantage states that a country who makes use of most of its resources (skill, labor, minerals). After 9/11, Pakistan faced challenges like insurance companies charging inflated rates on the shipments and American consumers refusing to purchase textile items because of “terrorism reputation”

The prestigious Pakistan & Gulf Economist (Kazmi, 2001) has noted that "(While) the textile sector contributes the highest percentage in total exports of the country, the main products are yarn, grey fabrics and low and medium quality goods. The average unit price realization is often below the world average. The Government of Pakistan (GOP) policies have always been, even today, influenced by certain pressure groups. The result is: glut of locally produced yarn, inadequate and inefficient weaving, processing and manufacturing facilities. The exponential expansion of spinning capacity has been done at the cost of other sub-sectors...
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