Having ranked first in the British Backpacker Society’s ‘Places to Visit 2019’, Pakistan is gaining recognition as an emerging hot-spot for tourists, with travel guide Lonely Planet calling the country “tourism’s next big thing”.
Home to the world’s fifth largest population, Pakistan welcomed a record 1.9 million tourist arrivals in 2018, up from 965,000 in 2016 and 563,000 in 2015, according to data displayed by Geo, the country’s leading broadcaster. Boasting a wealth of stunning scenery, Pakistan is drawing in both foreign tourists and Pakistani expats.
Meanwhile, domestic tourism reached 38 million in 2018, a 30% rise on 2016, according to the state-owned Pakistan Tourism Development Corporation.
Yet despite these growing tourist arrivals and bookings, greenfield investment monitor fDi Markets has not recorded any foreign investment to Pakistan’s hotel and tourism sector since 2013. Whether FDI will follow in the wake of this uptick in tourists remains to be seen.
Various foreign investment opportunities in tourism exist across Pakistan, especially in the country’s scenic northern region. “Our clients are those who are looking for something different but want an experiential holiday rather than a destination holiday,” says Sadia Baber, CEO and founder of Xperience Pakistan, an operator of customisable tours.
Pakistan’s northern region is home to five of the world’s 14 highest mountain peaks, while the country also includes natural attractions such as the dense forests and waterfalls of Neelum Valley; the 77,000-square-metre Thar Desert; and the world’s second largest non-polar glaciers.
Adventure tour specialists Wild Frontiers recorded a 40% year-on-year rise in bookings to Pakistan in 2019. A highlight of the company’s summer tour is the annual Shandur Festival, a polo tournament running since 1936 that is held 3750 metres above sea level. In addition to this are cultural attractions, with more than 480 religious and heritage sites listed by Pakistan’s Tourism Development Corporation, 32 of which are on the Unesco World Heritage or tentative lists.
“Pakistan is a cradle of ancient civilisations,” says Mohammad Nafees Zakaria, Pakistan’s high commissioner to the UK. For example, the Harappan civilization of the Indus River Valley is one of the world’s oldest, dating back to 3300BC.
Tourism numbers into Pakistan’s cultural sites alone rose from 3.2 million visits in 2016 to more than 6.6 million in 2018, according to Gallup Pakistan’s Cultural Heritage and Museum Visits report. Many of these hold both religious and historical significance.
“We have a huge heritage of Muslim sites, and also for Sikh faith, Buddhist faith and Hindu faith followers,” says Shoukat Popalzai, president of the Balochistan Economic Forum.
The importance of these sites is being widely recognised. Korean monk Hyecho travelled to the Gandhara region 1300 years ago, and now many Korean Buddhists trace their religious origins by visiting the area. In January 2020, Kanasugi Kenji, Japanese deputy minister for foreign affairs, visited the region and pledged continued support for the protection of Buddhism heritage and archaeological sites in the country, according to Dawn, a leading Pakistan newspaper.
Prime minister Imran Khan also inaugurated the Kartarpur corridor in November 2019, facilitating the visa-free entry of Indian Sikh pilgrims to the shrine of Baba Guru Nanak, in time for the 550th birth anniversary of the founder of Sikhism.
A safer bet
A recent major concern for tourists to Pakistan has been personal safety. However, on January 24, 2020, the UK Foreign and Commonwealth Office updated its travel advice, saying: “The security situation in Pakistan has improved considerably following action by the Pakistan government and security forces.”
The UK has cast other votes of confidence in Pakistan’s safety. British Airways flights to the country resumed in June 2019 after a decade’s absence, while the visit of the Duke and the Duchess of Cambridge in October 2019 was the first royal trip to Pakistan for 13 years.
Mr Khan has prioritised the tourism sector. His party’s pre-election manifesto stated: “[Our] government will promote and position Pakistan as Asia’s 'best kept secret' in the global tourism market in order to boost tourism by building 20 tourist resorts in its five-year tenure.” Mr Khan delegated tourism promotion to provincial governments in 2019, highlighting the need for collaboration between the provincial and federal governments to remove obstacles.
“The increase in tourism is principally due to security improvements and the new law delegating tourism to the provinces,” says Balochistan Economic Forum’s Mr Popalzai.
The government has also implemented a policy to relax travel restrictions for visitors. This includes the launch of a new e-visa scheme in March 2019, which offers electronic visas to 175 nationalities. It has also abolished the ‘no objection certificate’ required by foreigners to travel freely around the country.
The enactment of six regulatory reforms, such as online tax payments and a one-day registration process for companies, has helped Pakistan climb 28 places in the World Bank’s Doing Business report for 2020, putting it in the ‘top 10 business climate improvers’ list, according to Zufhran Qasim, director of Pakistan’s Board of Investment.
Although the signs are positive, Pakistan was the least competitive south Asian country in the World Economic Forum’s Travel and Tourism Competitiveness Report for 2019. Despite rising three places to rank 121st out of 140 countries overall, Pakistan still requires substantial improvements to its tourism-related infrastructure, according to the report. On this, Mr Popalzai says: “The government has to put in more effort to improve the connectivity of the provinces.”
The government is making efforts to heed these calls, with plans to increase spending on railways and transport shown in the Board of Investment’s Strategy Report 2020-24. Ongoing construction to the China-Pakistan Economic Corridor will also boost connectivity.
Although challenges remain, Mr Zakaria at the High Commission urges foreign investors to look seriously at Pakistan, saying: “We have identified a range of projects in Pakistan’s tourism-related infrastructure, and in [hotels and hospitality].”