Judicial Activism in Pakistan is Challenging for Foreign Investor in the Context of China and Pakistan Econonic Corridor

Li Youxing, Muhammad Farhan Qureshi


The judiciary has an important role in Pakistan. If the judicial system of any state provides appropriate law and justice,it would not only benefit local investors, but also provide a favorable environment for foreign investors to enhance their business. The support of the  judiciary system is crucial for foreign investors in order to enhance FDI. In the past few years foreign investors were facing challenges by the courts in Pakistan. Due to judicial activism not only Pakistan being a host state had to experience failure in investment projects, but also the foreign investors had to become a victim of massive loss.In the constitution of Pakistan the courts have the power to take action against any case in the interest of  the public. Suo moto is a constitutional power and judiciary have the right to use this power in any case.China is initiating a huge investment in Pakistan, which will not only provide great scope to the investors in growing their businesses but also will promote job opportunities, technology transfer,economics and prosperity of Pakistan. The judiciary system of Pakistan is likely to impose great challenges to the Chinese investors.It has been observed in the past that the judiciary in Pakistan had played a role in creating issues in the development of foreign investment leading to termination of the investment agreement.Moreover in some cases  foreign investors were compelled to leave the country. Due to judicial activism privatization of Steel mill had been halted which became a burden to the Government of Pakistan. The foreign investment in Rental Power Project had also been terminated due to judicial activism. Chinese investment in Orange train  is a recent example of judicial activism in Pakistan, which led to huge loss to the Chinese investors on account of halting of its construction after the agreement.

Keywords. Judiciary,Foreign investor protection,Judicial Activism,CPEC

DOI: 10.7176/JLPG/95-13

Publication date:March 31st 2020

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ISSN (Paper)2224-3240 ISSN (Online)2224-3259

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