Team Details:
| ABDUL RAUF Assistant Professor National Defence University, Islamabad (PI) |
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| ABDUL JALIL Professor National Defence University, Islamabad (Co PI) |
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| AHSAN ABBAS Assistant Professor National Defence University, Islamabad (Co PI) |
Theme/Relevant Ministry:
BUSINESS, INVESTMENT AND EXPORTS:
Drug Regulatory Authority of Pakistan
Project Brief:
Exports are critical for employment generation, poverty alleviation and sustainable economic growth. Extant literature reveals that internal R&D and external knowledge are major drivers of export competitiveness. Thus, enterprises in developing countries accelerate indigenous R&D efforts and governments develop and implement strategic frameworks to attain a competitive advantage for their goods in the global market. Besides, countries import intermediate goods, acquire technology licenses, and make useful alliances to adopt external technological knowledge. This channel of technology transfer is critical for developing countries where firms allocate a little resource for internal R&D. However, innovation is long, risky and costly and the success hinges upon a variety of firm-level characteristics which requires to be investigated to formulate a prudent innovation-oriented export strategy. This study aims to dissect the effect of internal R&D and two diverse channels of international technology diffusion through imports namely imported input variety and external technology acquisition/licensing on the export competitiveness of pharmaceuticals in Pakistan. Despite this sector’s economic significance, literature on innovation-export interplay is scant. Further, there are several regulatory and technological constrained which bars the innovation ability of firms and in turn confine their export competitiveness. The study strives to fill this gap in existing literature. The study will utilize a comprehensive survey of pharmaceutical firms, constituting 90% to 95% of the market, located in different regions.
Public Policy Relevance:
The study explores the impact of internal R&D, input variety and technology acquisition on the export competitiveness of firms. This research will be useful for policymakers engaged in formulating innovation policy and it will provide useful insights for a prudent trade policy. The results of the study will provide policy points for the Strategic Trade Policy Framework (2020-25) and Pharmaceuticals Export Strategy Framework (2023-27). The findings can be used by the tax authorities engaged in finding and allocating effective tariff rates on the import of inputs. Further, the results shall help firms to import/acquire appropriate technology given the internal R&D capability because some technologies are labour-using and require a low level of R&D capability while others are labour-saving and demand a higher level of absorptive capacity to adopt and internalize.