The Impact Of Energy Shortage On Economic Growth Of Pakistan: Empirical Evidence From Time Series Analysis

Energy crisis and shortage is an overwhelming and old problem of Pakistan.Economic growth and other sectors are constantly affecting by this problem.From the time of independence,Pakistan economic system goes through various stages to resolve the problem by bringing various reforms.The government introduces cheaper resources of energy and electricity to the fulfillment of household and industry needs.However,still Pakistan on the verge of energy and power crisis.The current study is an endeavor to dig out and investigate the possible consequence on Pakistan,specifically the economic growth.Since energy sector is considered to be a backbone of economy,therefore,its acute shortage negatively affect the economic growth and other sectors of economy.In this study I apply autoregressive distribute lag model(ARDL).The bound testing results show that there is long run relationship between energy infrastructure and economic growth.The results report that energy infrastructure positively affect the economic growth.Similarly,the control variables also have expected signs suggested by economic theories.The inclusion of additional control variables also found to be robust for our analysis.The study is important for policy concern.Electricity reforms should be top priority and quickly yield major economic gains.Well designed reforms will directly affect the poor class by increasing access,improving reliability,and reducing cost of emissions.Therefore,efforts should be made in order to acquire the desired goals of economic growth.