Firms’ Financial Inclusion and Export Performance: Evidence from Manufacturing Sector of Pakistan

Firms’ Financial Inclusion and Export Performance: Evidence from Manufacturing Sector of Pakistan

Partner: RASTA / PIDE & Planning Commission of Pakistan

Timeline:  April 2022 – July 2023

Introduction: Pakistan's export performance remained low and unimpressive despite employing several measures to improve it. Limited availability of long-term financing for firms to expand export capacity is one of the key factors impeding Pakistan's export performance. Literature provides robust evidence on the fact that firms' financial inclusion ensures sustainable economic growth induced by export performance and orientation. The study aims to conceptualize the impact of firms' financial inclusion on export performance in the case of Pakistan. It further quantifies the effect of firm's financial variables and other covariates on firms' export performance through Multi-Factor Model. The sample includes the manufacturing firms listed on Pakistan Stock Exchange, and the data comes from firms' balance sheet variables ranging from 1999-2020. The study intends to provide an evidence-based policy framework that facilitates sustainable economic growth via robust export performance.

Objectives:

•  To investigate whether the financially Inclusive firms of the manufacturing sector of Pakistan depict better export performance

• To perform Dis-aggregate analysis:

                   1: By Sector

                    2: By Size (LMS & MSE)

                    3: Based on Capital Structure (Leveraged Vs Equity)

Activities: Desk Study, Literature Review, Data Digitization and Collection, GMM and Quantile Regression Analysis, Final Report.

Team: Dr Fareeha Armughan, Dr Rabia Nazir, Mr Naimat Ullah