According to World Bank’s ranking, Pakistan is marginally behind India in access to finance and efficiency, whereas it ranks the highest in corporate governance in the South Asian region.
In other words, the negative term premium matters a lot for financing behavior, but in this stylized world, investment spending is decoupled from the term premium and is determined instead by the expected future path of short rates. This reasoning suggests why one might expect future rounds of Treasury-based LSAPs to have diminishing returns, at least for corporate investment.