provide a list of importers for any country for any in...
TRANSCRIPT
Export News 09-2007
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In this Issue
NEWS UPDATE Cover Story
General Information ⇒ Shifting of Haripur Chamber of Commerce &
Industry’s Office
Business Opportunities ⇒ Investment Opportunities in Lesotho
Fairs and Exhibitions ⇒ World Food Montana World of wearable Awards
Show
⇒ Africa’s Big Seven
INTERNATIONAL TENDERS
Cover Story
LIST OF BUYERS - INDIA Cover Story
REPORT GUIDE Cover Story
⇒ Key Issues in Industrial Growth in Pakistan
INTERNATIONAL ENQUIRIES Cover Story
FEEDBACK FORM Cover Story
R e a d e r s P l e a s e P r o v i d e F e e d b a c k o n t h e f o r m a v a i l a b l e o n t h e b a c k p a g e f o r f u r t h e r i m p r o v e m e n t o f t h e b u l l e t i n
“ TDAP Can Provide a List of Importers for any Country for any product at CAC
Karachi”
Export News No: Vol. 09-2007 5th March 2007
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GENERAL INFORMATION
Shifting of Haripur Chamber of Commerce & Industry’s office
Haripur Chamber of Commerce & Industry has informed that HCCI’s office has been shifted from 12-Ameer Khan Silkway Plaza, G.T. Road, Haripur to its own premises.
New address of HCCI office is as under: - Haripur Chamber of Commerce & Industry, Chamber House, Opp. Session Judge Bungalow, GPO Road, Haripur Tel: 0995-613364 Fax: 0995-614644 E-mail: [email protected]
BUSINESS OPPORTUNITIES
Investment Opportunities in Lesotho
Kingdom of Lesotho is highly interested in the companies that would want to set up their operations in Lesotho whether in joint Ventures or full foreign ownership.
Investment opportunities exist in the following sectors:- ⇒ Integration of the clothing and
apparel sector ⇒ Assembly of consumer electronics
and electrical appliances ⇒ Plastic products ⇒ Food Processing ⇒ Leather processing ⇒ Resource based projects, e.g.
ceramic ware, stone products and brick production
⇒ Waste recycling ⇒ Industrial infrastructure development
e.g. Development of industrial and commercial property
Interested Pakistani businessmen may contact directly at the following address:- Consulate Address: The Honorary Consulate of the Kingdom of Lesotho D-99, K.D.A. Scheme No.1, Karachi 75350, Pakistan
Liasion office Address: S-31, S.I.T.E, Mauripur Road, Karachi75730, Pakistan Tel: (92-21) 2354345, 2354711-15 Fax: (92-21) 2354346, 2354717 Email: [email protected] Website: www.lesothoconsulate.com
FAIRS & EXHIBITIONS
Montana World of Wearable Awards Show
Montana New Zealand hold World of Wearable Art Awards Show every year in New Zealand for International designers.
Wearable Awards Show is a prestigious event for designer to exhibit their design. It will provide a good opportunity to Pakistani garment designers to display their products at international level.
The last date for submission of the entry in the aforementioned Award Show 2007 is 4th May, 2007.
Interested Pakistani Designers may contact directly at the following address: - Heather Palmer, Competition Director, World of Wearable ArtTM P.O. Box No. 9037, 95 Quarantine Road, Annesbrook Nelson, New Zealand. Tel: (0064 3) 5470861 Fax: (0064 3) 5470324 E-mail: [email protected] URL: www.worldofwearableart.com
Africa’s Big Seven
Africa’s Big Seven will be held from 15th ~ 17th July 2007 at Midrand, South Africa.
This event has a lot of potential for Pakistani exporters of Food Stuff.
Interested Pakistani Exporters / Manufacturers / Businessmen may contact directly at the following address: - Exhibition Management Services, P.O. Box No. 650302, Benmore 2010, Johannesburg, South Africa, Tel: +27-11-783-7250/1/6/9 Fax: +27-11-783-7269 E-mail: [email protected]
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Trade Development Authority of Pakistan, Government of Pakistan has received the
following International Tenders. The complete details are as under: -
BANGLADESH
Bangladesh Telegraph and telephone Board Office of the Director Procurement Telephone Revenue Bhaban 2nd floor, Sher-e bangla Nagar, Dhaka-1207 Telephone: 880-02-8150600 Fax: 880-02-8150511
Supply of Maintenance Spaares for S-12 Switching System,
Power and Air Conditioning System. SDH Transmission (optical& microwave) and WLL Equipment installed and Commissioned under the Project Installation and Expansion of digital Telephone Exchange.
Closing Date: 19TH April 2007
The above tender documents are also placed on TDAP Website www.tdap.gov.pk on the
date of receipt. Tenders & enquiries are also published in the daily Business Recorder on the
next day of receipt.
P R O C E D U R E F O R S U B S C R I P T I O N
TDAP’s Newsletter as you may have noticed is now not only promptly and regularly issued each week, but its content is updated and relevant to the needs of our exporting stakeholders.
It is available on TDAP’s Website www.tdap.gov.pk but if you need hard copy you may subscribe.
The Procedure of Annual Subscription of 52 Issues of Export News is a simple request on company letter head, addressed to Director Communication, along-with a pay order / bank draft of Rs. 500/- (Ruppees Five Hundred only) in favour of Account Officer EMDF, Trade Development Authority of Pakistan, (formerly EPB), Karachi.
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Firm Name Contacts Description of Goods A.A. Tradewings, TC41/2387, TRA-51, Dharulsalam, Manacaud Post, Thiruvananthapuram-695009, Kerala State, India. Ph: +91-471-2464376, Fax: +91-471-2464376, E-mail: [email protected] (Abdul Salam)
Wish to buy Anaesthesia Products, Diagnostics, Hospital Furniture, Hospital Garments, Medical Disposables, Microscopes, Rehabilitation Aids, Rubber Goods, SS Holloware, Suction Units, Sterilizing Equipments, Laboratory Goods, Midwifery Kits, Orthopaedic Implants and Instruments etc.
Aditya Surgical & Scientific, IVRI Road, Bareilly, U.P. - India. Ph: +91-9897694488, 9359109517, E-mail: [email protected] (Sumit Saraswat)
Wish to buy Anaesthesia Products, Diagnostics, Hospital Furniture, Medical Disposables, Microscopes, Rubber Goods, Suction Units, Orthopaedic Implants and Instruments.
Argon Medical Systems, 310, Sector-ii, Shakti Nagar Bhopal-462021, India. Ph: +91-9827278927 E-mail: [email protected] (Pankaj Dixit)
Wish to buy Drill & Saw System.
Argos International, 8th Floor, Kalpataru Synergy, Opp. Grand Hyat, Santa Cruz (E), Mumbai-400055, India Ph: +91-22-30642009, 30642059 9833945401, E-mail: [email protected] (Aakash Kundal)
Wish to buy Disposable Syringes, Butterfly Needles, Surgical Gloves, Infusion sets
Bellstone Hi-Tech International, 3764-65, Parmanand Street, Darya Ganj New Delhi-110002, India. Tel: +91-11-23273751/52/53, 2324577 Fax +91-11-23251506, 23251706, 23917561 E-mail: [email protected] and/or [email protected] (Mohit Malhotra)
Wish to buy Laboratory Glasswares.
Bhandari Children Hospital, 90-L Road, Udaipur-313001, Rjasthan-India. E-mail: [email protected] (Dr. Harit Bhandari)
Wish to buy Orthopedic Surgical Equipments.
Brio Healthcare, C-510, Kailas Esplanade, LBS Marg, Ghatkopar West, Mumbai-400086, India. Ph: +91-22-67703759 E-mail: [email protected] (P. Sinha)
Trading Company based in Mumbai having operations in Gujarat, Tamil Nadu, Karnataka, Kerala, Andhra Pradesh, Kolkata, Patna, Assam, Bangladesh, Nepal, Sri Lanka, Yemen, Oman and Jordan, wish to buy Anaesthesia Products, Diagnostics, Hospital Furniture, Hospital Garments, Medical Disposables. Microscopes. Rehabilitation Aids, SS Holloware, Suction Units, Sterilizing Equipments, Midwifery Kits, Orthopedic Implants and Instruments etc.,
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B.S. Enterprise, A/9, Jayjaswant HSC Society, Bhandup East, Mumbai, India. Ph: +91-9833787727 E-mail: [email protected] (Bijit Saha).
Wish to buy Anaesthesia Products, Diagnostics, Hospital Furniture, Hospital Garments, Medical Disposables, Microscopes, Rehabilitation Aids, Rubber Goods, SS Holloware, Suction Units, Sterilizing Equipments, Laboratory Goods, Midwifery Kits, Orthopaedic Implants and Instruments etc.
Eastern Medical & Surgical Corporation, 49 Aminabad Park, Lucknow, India. Ph.: +91(0522) 220l5l9,2201360, Fax:+9l (0522) 2201360 E-mail: [email protected] (Prateek Khandelwal)
Wish to buy Surgical / Medical and Disposable Products.
Growing Enterprises, A-45, Kanaka Nagar, Trivandrum-695003, India. Ph.: +91-471-2317998. E-mail: [email protected] (S. Shahnawaz).
Wish to buy latest Face Mask, Eye/ENT/Gynae/Ortho Drapes, ESP Kit, Eye Drain, ENT Cover, C-Arm Cover, OBTE Pads/ Bags, EGC Machines etc.
Imran Saleem, 11/5, Pratap Market, Aminabad, Lucknow, UP - India. Ph: +91-9935556573, Email: [email protected]
Wish to buy Mackintosh, PVC Sheeting, Doormats and other Medical Rubber Goods.
Inotech Supplies Pvt. Ltd., # 671, 6th Main, RBI Colony, JP Nagar, 7th Phase, Bangalore-560078, India. Ph.: +91-080-41329557, Fax: +91-080-41329558, E-mail: [email protected] (Vishalakshi)
Wish to buy Plastic Wash Bottles.
Ishwari Healthcare, 52, Whispering Palm Center, Lokhandwala Township, Akurli Road, Kandivali (E), Mumbai 400101, India. Tel: +91-22-28876600/6611, Fax: +91-22-28876611, Email: [email protected] and/or [email protected] (Shatrughan Z. Nenwani).
Wish to buy Surgical Blades, Scalpels, Skin Graft Blades, Stitch Cutters.
Lucknow Diagnostic Agency, F-27, G.B. Marg, Ishwari Dayal Complex, Lucknow, U.P, India. Ph: +919415410586 E-mail: [email protected] (Virendra Kumar Singh)
Wish to buy Diagnostics, Hospital Furniture, Microscopes, Laboratory Goods, Orthopaedic Implants and Instruments etc.
Mahak Trading Company, 123-E/7, Dehria, Moradabad, India. Ph: +91-591-2471301 E-mail: [email protected] (S.A. Khan)
Wish to buy Sterilizing Equipments, Laboratory Goods.
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M. R. HeaIthcare Pvt. Ltd., Near State Bank of India, Ramnagar, Distt.-Nainita1, Uttaranchal, India. Ph: +91-5947-252123, 282111, Fax: +91-5947-282111, 251456 E-mail: [email protected] (Neha Gupta - Product Executive).
Wish to buy Surgical and Gloves (Different Size) Apron, Nose Mask, Shoe Cover, Had Glove. All in Disposable Materials.
R.K. Enterprises, 127/11 Near Post Office, Jahangirabad, Bhopal, MP-India. Ph.: +91-755-4941722, +919893341722, Fax: +91-755-4253182. E-mail: [email protected] (Rehman Khan).
Wish to buy Microscopes and others Laboratory Goods.
R R Glass Works, 197 R R Temple Road, Devasandra Main Road, Bangalore, karnataka, India. Ph: +91-9880008670 E-mail: [email protected] (Mohana Rayappan)
Wish to buy Medical Disposables, Laboratory Goods (Glassware & Plastic ware).
SDS Limited, H/1A, Hauz Khas, New Delhi, India. Ph: +91-1142657260 Fax: +91-11-42657261 Email: [email protected] (M.H. Ali)
Wish to buy Oxygen Concentrator, pH Meters, Pulse Ovymeter etc.
Sharda Medical Equipment Pvt. Ltd., VDS-18, Sector-110, Noida, U.P.-India. E-mail: [email protected] (Rajneesh)
Wish to buy Diagnostics, Hospital Garments, Medical Disposables.
Shri Nakoda Enterprises, B-26, New Market, Khasa Kothi Circle, Jaipur-302016, India. Tel.: +91141-2203497, 2203982, 3240981, Fax: +91-141-2201424 Email: [email protected] (Kamal Sachetee)
Wish to buy Weighing Machine, Adult (Qty. 40,000).
Shree Shakti Enterprises, 2nd Floor, N.K, House, Opp. Vasna Telephone Exchange, Vasna, Ahmedabad-7, Gujarat-India. Ph: +91-79-26642626. E-mail: [email protected] (Vishal Patel).
Wish to buy Anaesthesia Products. Diagnostics, Hospital Garments, Medical Disposables, Rubber Goods.
Siddhant Medical Engineering, Bhaskara B-701, DSK Vishwa, Dhayari, Pune 41, India. Ph: +91-20-66205660, +91-9881409878 E-mail: [email protected] (Mr. Udavant Deepak Vamanrao)
Wish to buy B.P. Apparatus Spares & Anaesthesia Products, Medical Equipments & Surgical Disposables.
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Stallion Enterprise, A/1204, Vasant Aradhna, Kandivalir, Mumbai, India. Ph.: +91-9820075415, Fax: +91-22-28011263 E-mail: [email protected] (Saumil Shah)
Wish to buy Diagnostics, SS Holloware, Orthopedic Implants and Instruments.
Umkal Hospital, Gurgaon-India. Ph: +91-9810779800. E-mail: [email protected] (Raj Sehgal, DGM-Operations)
Wish to buy Hospital Equipments used in OPD, UV Steriliser, Hospital Furniture used in OPD, Instruments used in OPD (Eg Height & weight scale, Carsh cart, Dental instruments, ENT Instruments, Diagnostic) etc. for a new Hospital Healthcare Projects in Gurgaon-India.
Yassh Medicals, 204, Gyan Bhawan, 8-Kapoorthala, Aligunj, Lucknow-24, India. Tel: +91-5224046506 E-mail: [email protected] (Mr. Dilip Vidyarthi)
Wish to buy Anaesthesia Products, Hospital Furniture, Suction Units, Orthopaedic Implants and Instruments etc.
Radical Instruments, (An ISO 9001 Certified Co.) 123, H.S.I.D.C. Industrial Esate, Ambala Cantt-133006, India. Tel: (+91-171) 2699485, 2699137, 2699138 Fax: (+91-171) 2699238, 2699543 Email: [email protected] Website: www.radicalindia.com
Microscopes & Spares (ISI & CE Marked)
Narang Medical Ltd., Narang Tower, 46 Community Centre, Naraina Ph-I, New Delhi-II 0028, India. Tel: +91-11-25892020 & 41495070, Fax: +91-11-25892026 & 41495076, E-mail: [email protected] Website: http://www.narang.com
Orthopaedic Implants (STAINLESS STEEL & TITANIUM)
Prominent Surgical Co., Near Post Office, Basti Sheikh, Jalandhar (Punjab), India. Tel: +91-181-2430675, Fax+91-1812431783. E-mail: [email protected]
Tweezers & Forceps
Narang Medical Ltd., Narang Tower, 46 Community Centre, Naraina Ph-I, New Delhi-110028, India. Tel:+91-1125892020 & 41495070, Fax: +91-1125892026 & 41495076, E-mail: [email protected]
Tweezers & Forceps
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K E Y I S S U E S I N I N D U S T R I A L G R O W T H I N P A K I S T A N I . I N T R O D U C T I O N
Over the last couple of years manufacturing sector has grown at the rates of 14.1 and 12.5 percent and the large scale manufacturing at even more rapid rates of 18.2 and 15.4 percent. These growth rates are more than twice the growth rate of the first three years of the present decade and more than three times those observed in the 1990s. On the other hand investment in the manufacturing sector during the two years has declined at a rate of 2.6 percent comprising 8.5 percent growth in 2003-04 and 12.6 percent decline in 2004-05. As a percentage of GDP investment increased from 3.2 percent in 1999-2000 to 3.6 percent in 2003-04 but declined sharply to 2.9 percent in 2004-05. The low levels of investment cast serious doubts on the sustainability of growth rates of manufacturing output. The low and fluctuating rate of investment is a cause for concern and has been responsible for the slow and fluctuating growth of the manufacturing sector.
Manufacturing sector of Pakistan suffers from various structural problems resulting in slow growth rate of investment, output and exports. These include among others lack of diversification; allocative, technical and X-inefficiencies; poor quality of products; and low levels of R&D activities resulting in slow growth rates of productivity making the Pakistani products uncompetitive in the world market. The traditional industries such as food and textiles industries still account for an overwhelming share of the manufacturing output; food industries accounted for 13.8 and textiles for 24.0 percent of the total manufacturing value added in 2000-01. On the other hand industries based on the modern technologies such as electrical and non-electrical machinery and automobile industries accounted for just 4.4 and 4.7 percent of value added respectively. Even though chemical industries accounted for around 15.2 percent of manufacturing output most of the chemical industrial output is concentrated in low-tech and low value added industries.
Because of high protection rates value
added of the manufacturing sector at world prices has been just a fraction of that at domestic market prices. The productivity levels in most of the manufacturing industries continue to be low making it increasingly difficult for Pakistani producers to compete in the world market. Low quality of products, lack of standardization, low value added products sold without any brand names, lack of innovation and low levels of productivity is the legacy of the import substitution industrialisation and indicate the need for major restructuring of the manufacturing sector.
Why the entrepreneurs are still reluctant to invest which limits productivity and competitiveness of the manufacturing sector? Is it due to low levels of profitability resulting from higher production costs or it is due to their perception that the policies may change with serious implications for their long run profitabilities? Is the cost of production high due to the production, technical, allocative and X-inefficiencies or it is due to the high cost of inputs, both traded and non-traded? Is the cost of transaction high in the country and the procedures are cumbersome, and government attitude manifested in the tax administration, labour inspectorate and non-investment friendly attitude of various government departments? Or is it due to poor skills and high wage adjusted for productivity levels that is constraining the investments? Or fluctuations in manufacturing output are due to changes in the demand patterns? This paper attempts to examine these issues and suggests policy measures for sustaining high growth rate of the manufacturing sector.
Plan of the paper is as follows. After this introductory section, the growth rates and patterns of industrial growth are examined in section 2. The main problems faced by the producers are examined in section 3. A strategy for rapid and efficient growth of the large scale manufacturing sector in the perspective of the strategy outlined in the Medium Term Development Framework is outlined in section 4. Main conclusions are summarised in the concluding section of the paper.
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I I . TRENDS IN GROWTH AND PATTERNS OF THE MANUFACTURING SECTOR
Starting from virtually scratch at the time of independence, Pakistan has made significant advances in the manufacturing sector. A handful of industrial units producing sugar, vegetable ghee, tea blending, cement and cotton textiles comprised the total large scale industrial assets of Pakistan at the time of independence they contributed only 1.8 percent to GDP. The small-scale industries however, contributed 4.6 percent to GDP. While the share of small-scale industries has increased only to 5.6 percent, the share of large scale industries increased to 12.7 percent by the year 2004-05. The share of manufacturing sector in GDP has increased from 6.4 percent in 1949-50 to 18.3 percent in 2004-05.
Over 1950-2005 period manufacturing sector has grown at a rate of 7.5 percent, and the large and small scale manufacturing industries at rates of 9.2 and 5.5 percent. However, the average growth rate of the manufacturing industries conceals wide fluctuations across decades and within each of the decade. For example rather high growth rates were observed in the 1950s, 1960s, and 1980s and over the last few years and low growth rates in 1970s and 1990s.
The manufacturing industries grew at a rate of 7.7 percent during the Fifties and the large-scale industries at a phenomenal rate of 15.8 percent. The industrial policy during the 1950s aimed at manufacturing the products based on indigenous raw materials such as cotton, jute, hides and skins, etc. for which there was an assured market at home and abroad, and developing the consumer goods industries to meet the requirements of home market for which the country was heavily dependent on imports. The two main characteristics of the policies during the 1950s have been direct controls on imports, investment, prices etc., and the bias against exports.
Growth of manufacturing sector accelerated even further to 9.91 percent during the 1960s. A number of initiatives helped in realizing the high growth rate,
which included liberal import policy, subsidy to exports through a number of schemes such as Export Bonus Scheme, tax rebates, tax exemption, Export Performance Licensing, Pay-As-You-Earn Schemes etc. Protection rates in the period were rather high resulting into excessive profits for the producers. Moreover, tax holidays and accelerated depreciation allowances to increase the post-tax profits in the production of manufactured products were also granted.
The growth rate of the manufacturing sector fell to 5.50 percent and for the large scale manufacturing to just 4.84 percent during the 1970s. Most important initiative was the nationalization of heavy industry and a number of sectors including cement, fertilizer, oil refining, engineering, chemicals etc. were exclusively reserved for the public sector and the policy of divesting profitable public sector units was discontinued. Moreover, the industrialists faced a number of restrictions including price fixation by the government under Profiteering and Hoarding Act. These measures created considerable amount of uncertainty, resulting in fall in private investment and flight of capital. Moreover, these policies had long run implications for the industrialization process and the reluctance of private sector to invest continues even to-date.
During the 1980s the process of de-regulation, de-control and denationalization was initiated and various measures were taken to restore the confidence of the investors. Administrative controls were replaced with market-oriented forces; import policy was liberalized, and tariff structure was rationalized; par value of rupee was brought nearer to its equilibrium value and it was made convertible on capital account; investment licensing was abolished; prices were de-controlled; and performance of public enterprises improved due to signaling system. The market friendly policies resulted in acceleration of growth rate to 8.21 percent.
While the process of deregulation continued and public enterprises were privatised, growth rate decelerated to 3.88 percent in the 1990s. The performance of large-scale manufacturing was even more disappointing which grew at a rate of only 3.54 percent. A number of economic and non-economic factors have been responsible for the deceleration of growth. Prominent factors have been political instability; worsening of law and order situation in the major growth poles of the
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country; reduction in protection rates resulting in closure of a number of industries; emergence of significant infrastructure bottlenecks in transport and other sectors; inadequate power supply along with frequent breakdown of power supplies in the early part of the 90s and sharp increase in the prices of power in the later years; and inadequate industrial investment.
The growth rate of manufacturing output has increased sharply since 1999-00; the average growth rate of manufacturing sector over the five years has been 9.4 and the large and small scale industries 10.9 and 6.3 percent respectively. The growth rate has accelerated despite low levels of investment because of the demand stimulus in the form of credit for the purchase of consumer durable and sharp increase in exports after the quota restrictions were removed.
I I I . STRUCTURAL PROBLEMS CONFRONTING MANUFACTURING SECTOR
The performance of the manufacturing sector in Pakistan has been marred by a number of factors. These problems may broadly be grouped into industrial and trade policy distortions, narrow industrial base, low productivity levels, poor quality of products, role of public sector enterprises, the higher cost of production, problems in the regulatory framework, and weak infrastructure.
Industrialization Strategy and Pattern of Demand
Pakistan has all along pursued Import Substitution Industrialisation Strategy but it has failed to diversify the industrial structure. The cascaded tariff structure has provided higher protection to consumer goods with adverse implications for growth of capital goods and intermediate goods industries.
The imports substitution accounted for 96.9 percent of growth during 1951-55 period and for 25 percent during 1963-71 period. Because producers did not venture into new import substitution industries and continued with the traditional imports substitution
industries and therefore in the subsequent periods contribution of import substitution has been marginal. Since 1955 domestic demand has accounted for roughly three-fourth of the growth and roughly 25 percent to growth. Therefore, any slow down in the domestic demand and exports affect the manufacturing output adversely.
While trade policy reforms in recent years have exposed domestic enterprises to international competition, these enterprises continue to suffer from the legacy of import substitution and have yet to re-position themselves to compete effectively in the global market. Furthermore, the trade policy still has an import substitution bias for certain critical sectors like automobiles, whose imports are subject to tariff peaks. The continued protection to these sectors has not helped these enterprises to become globally competitive. It must, however, be recognized that protectionist policies may not be a viable strategy in the emerging multilateral trading system.
While Pakistan has successfully divested a large number of industrial units it has not always resulted in higher levels of efficiency because of the monopolistic tendencies in the economy. It has led to cartelisation with low levels of output and higher price levels. How to ensure maximum output after privatization through proper regulatory framework is one of the major issues.
Industrial Productivity Whereas growth rate of manufacturing
sector has been quite impressive, value added in this sector is grossly over stated due to distortions in the system. If value added in the manufacturing sector is evaluated at the world prices, its contribution to GDP is relatively much smaller, reflecting gross inefficiencies and/or excessive profits. Even in 1991 when some of the distortions had already been removed, more than 30 percent of value added could be ascribed to protection.
The efficiency levels varied significantly across different manufacturing industries: some industries were so efficient that domestic resources were only a fraction of their valued added and were generally penalized and some were so inefficient that value added was negative at world market prices and survived because of rather heavy protection. Whereas average DRC for consumer goods industries was 6.00, for intermediate and capital goods
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industries it was 0.22 and 0.82, respectively. Similarly, compared to the average DRC of 1.20 for the large-scale industries it was 1.49. Moreover, The DRCs for export-oriented and import-competing activities has been 0.54 and 2.15. It shows that tariff rationalisation that gives same level playing field to import substitute and export oriented industries and to consumer, intermediate & capital goods would help in improving the efficiency of the manufacturing sector.
For sustaining competitiveness in the activities where the country has comparative advantage and attaining the comparative advantage in which the country at present does not have comparative advantage, growth rates of productivity needs to be higher than that of the competitor countries. During the period 1992-2001, labor productivity in the manufacturing sector grew at a rate of 2.2 per cent, which though higher than that of Bangladesh and India is lower than that of other countries, such as Sri Lanka, Republic of China (Taiwan), & Korea.
Labor productivity is only a partial measure of productivity. An alternative measure that takes into account the other factors of production is total factor productivity.
A comparison of total factor productivity shows that except for republic of China, Pakistan experienced higher TFP over a longer period compared to the neighboring countries.
For the period 1964-65 to 2000-01, total factor productivity (TFP) in the manufacturing sector grew at a rate of 3.21 percent. We may note that the sharp increase in growth of productivity in the manufacturing sector shows a high degree of inefficiency in the sector in the base year reflected in the very high DRC estimates for the earlier years. For example DRC was 3.31 in 1980-81 which declined to 1.20 by 1990-91.
The TFP growth in the manufacturing sector exceeded 4 percent in 1960s and 5 percent in 1980s. In the 1960s TFP improved mainly to learning by doing with improved export competitiveness in the 1960s and in the 1980s due to de-regulation, privatization and liberalization of imports in 1980s. On
the other hand low growth of productivity may be attributed to the nationalization policies in 1970s and to slow embodied technical change resulting from low and falling levels of investment and the low capital untilisation due to slackness in the domestic and world demand in 1990s.
Even though total factor productivity growth rate in Pakistan has been quite high it reflects the low efficiency levels in the base year rather than improvements in productivity resulting from the technical change. Moreover, because TFP in the other countries have also increased it might have not impacted the productivity differentials. The main sources of productivity growth, viz. human resource development, R&D activities and engineering industries that provide machinery in accordance with the factor endowments of the country, have received relatively less attention in Pakistan and growth rates of productivity can be sustained provided these activities are promoted.
Lack of Diversification A broad based industrial sector is
essential for exploiting the opportunities offered by globalization but Pakistan’s industrial structure lacks diversification; in 2000-01, almost 38 percent of industrial value added was contributed by food and textiles. In the dynamic areas of electronics, machinery, and metal products, Pakistan has made hardly any progress, while the engineering sector is dominated by either assembly operations based on imported parts, or the production of basic and simple components. Furthermore, Pakistan has not been able to develop a strong capital goods sector: the share of the engineering industries in total manufacturing is around 5 percent. Not surprisingly, a narrow industrial base has led to highly concentrated exports: roughly 80 percent of the country’s manufactured exports consist of just textiles and clothing and carpets and rugs.
The Role of Public Sector Though role of public sector has been
drastically curtailed as a result of deregulation and privatization policies, some industries continue to be dominated by the state owned enterprises. Some of these enterprises produce primary raw materials and intermediate inputs and resultantly the inefficiencies of the public sector have an adverse impact on the downstream industries. For example, the
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inefficiencies of Pakistan Steel have been the major stumbling block to engineering industries. Now that it has been privatised one hopes that efficiency levels would increase resulting in a decline in prices. Since there is only one steel mill and the new steel mill recently inaugurated also belongs to the same owner the producer may exploit the monopoly power and increase the prices of basic steel. There is a need to regulate the supplies through liberal import policies. Similarly, the engineering industries in the public sector make the investment expensive and the otherwise viable investments are made less profitable. All the remaining public enterprises in the manufacturing sector should be divested with the clear understanding that the import duties on such products would be rationalized.
Smuggling and Higher Cost of Domestic Production
There is widespread smuggling and that has adversely impacted the growth of many industries especially the consumer durables. The domestic producers cannot compete with smuggled goods because import duties on raw materials and intermediate goods have been high. In recent years tariff rationalization has been instrumental in growth of consumer durables but more tariff rationalization is necessary and there is a need for long run policy.
Whereas the investment policy of 1997 clearly lays down fiscal incentives to various industries there is a need to ensure that protection to various economic activities and fiscal incentives reinforce each other. In particular, the incentive structure has to be so reformed that it promotes dynamic comparative advantage.
Cost of domestic manufacturing increases due to a number of factors including higher power and energy prices, labour levies that leads to an increase in the effective wage rates, high rates of sale taxes and high degree of corporate and income taxation.
Regulatory and Legal Environment Though Pakistan has strived to
improve the overall business climate, and
her ranking in terms of de-regulation has improved, weaknesses still remain in the regulatory and legal framework. Businessmen still have to comply with a host of regulations relating to work environment including health and sanitation, product standards, taxation, etc. Excessive discretionary powers in the hands of the enforcing agencies often lead to harassment of enterprises and opens up avenues for corruption resulting in loss of business confidence. To develop a viable industrial sector, there is a need to put in place a regulatory and legal environment that is conducive for private businesses. In particular the tariff regime must be put in place for over a longer period so that the producers can take the decision over long run
It is the lack of continuity in the policies that has been responsible for low levels of investment. Whereas over the last 5 years the government has not taken any decision that may have shattered the investors’ confidence but still the perception of the investors about future profitability remains doubtful.
Financial System A well-functioning financial system is
essential for industrial development and growth because it channels efficiently the investible funds to most productive uses. A series of measures adopted in recent years have led to improvements in the financial system but spread between the deposit and lending rate is still unacceptably high. Better appraisal and the strict implementation of the prudential regulations seems to have resulted in lower infected portfolios of the banks but so far have not resulted in low spread.
The availability of credit to the private sector has increased in recent years both because of an increase in the liquidity and a decline in the fiscal deficit resulting in lower levels of credit for budgetary financing. This had led to low rates of interest. However, the liquidity has somewhat reduced and the budgetary deficit has increased resulting in higher rate of interest. The changing levels of interest rates also result in lower levels of investment.
Foreign Exchange Market Pakistan is following a system of floating
exchange rates. However, State Bank of Pakistan intervenes and does not allow the market forces to operate. For example the
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inflation rate for second year is running at around 9 percent but the par value of rupee to dollar has not changed. While the lower value of dollar against rupee keeps down the cost of imports and promote investment it also hurts exports. Since exports have been one of the major contributory factor to the growth process proper exchange rate assumes great significance.
Weak Infrastructure Weak physical infrastructure has
been a major factor hindering the performance of the manufacturing sector. Whereas the lack of repair and maintenance has resulted in the deterioration of physical infrastructure, inefficiencies in the public sector utilities have contributed to high cost of production, thus eroding the competitiveness of domestic manufacturers.
Power Supply Despite efforts to encourage
efficient utilization of energy resources, the technical, financial, and operational efficiency of the power sector has continued to deteriorate resulting in costly yet unreliable power supply. According to a survey conducted by the World Bank, majority of the respondents identified the problems of power supply as a major obstacle to business expansion. It is estimated that a typical business in Pakistan on average loses 5.6% percent of annual output due to power outages as compared with less than 2% for the average plant in China.
In order to minimize downtime caused by problems in power supply, firms are often forced to use their own generators. It has been estimated that the use of generators on average ties up capital of a firm up to about 12 percent of its fixed assets. To make the situation worse, businesses often experience delays in getting power connections. For instance, according to World Bank (2003), the average waiting period for a business to obtain power connection is 45 days in Pakistan as against only 15 days in China.
Telecommunication Services Though the quality of
telecommunications has improved in
recent years, there is still room for further progress in terms of improvement in efficiency and expansion of fixed line connections. Privatisation of PTCL and competition in wireless and mobile telephones situation has improved significantly. With the advancement in information technology, the businesses all over the world are increasingly relying on the internet for communication purposes and carrying out their business activities. While the usage of internet in Pakistan is on the rise, poor connectivity and slow speed continue to the major problems.
Transport An efficient transport network is vital for
economic development. In Pakistan, the transport sector is incurring heavy asset losses due to inadequate maintenance of existing facilities. The unsatisfactory state of the transportation network has imposed enormous costs on the economy: according to a recent estimate, inefficiency in transport alone is reckoned to cost the economy Rs.320 billion a year.
Road transport is the dominant mode but the current state of the roads is far from satisfactory. Lack of repair and maintenance of the existing roads have resulted in the rapid deterioration of the road network. It is estimated that 70% of the national road network is in “fair to poor” condition, whereas 90% of the provincial network in Punjab is rated as “fair to poor”. Poor road conditions not only lead to delays but also result in excessive wear and tear of transport vehicles contributing to high transportation costs.
The rail network is also riddled with inefficiencies. The railways that are cost effective for long haul trafficking suffer from inefficiencies. Due to higher cost of alternative transportation modes, bulk of the freight is handled by the trucking industry resulting in overuse of the road network. The quality of air and shipping services is marginally better but costs are high owing to lack of competition. The freight handling costs at the ports in Karachi and Qasim are reckoned to be several times larger than those of comparable ports in the region. Furthermore, upcountry industrial centers are particularly at a disadvantage as they face even higher costs of transportation of raw materials and other inputs from the Karachi port.
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Human Resource Development Pakistan is deficient in skilled
human resources that are vital for technological advancement. More specifically, quality of scientific manpower produced in the educational institutions is poor not least because of lack of highly qualified professional teaching staff. Moreover, because of higher returns, the best students are not opting to pursue science and technology. Furthermore, the skills imparted in various polytechnics and the vocational institutions are not demand driven and resultantly most of the skilled workers graduated from these institutions fail to get a job. The productivity of various industries is adversely affected due to lack of skilled workers and some of the industries do not get established because of the lack of requisite skilled workers. In order to build a sound and diversified production structure in the industrial sector, Pakistan needs to attach high priority to human resource development.
Science and technology In a rapidly changing international
economic environment, science and technology is vital for sustaining the development momentum. Unfortunately, the state of science and technology has been far less satisfactory in Pakistan as compared with other emerging economies.
Pakistan lacks strong engineering foundations and the loss of qualified personnel has further hindered the development of the country’s technological base. The poor state of science and technology may also be attributed to the relatively less awareness of technological needs and capacity of the domestic industries; weak link between industry, academic, and research institutions; and lack of resources for scientific research and technology development. To prepare the country to face the emerging challenges, the development of science and technology and its interface with the industry has to be brought to the forefront of the industrial vision for the future. While some work has been initiated recently that is just tip of the iceberg.
Skill Development The labor market in the country can be
characterized by the shortage of middle-level skilled personnel and unemployment of educated persons. The availability of skilled manpower is essential for raising the productivity levels as well as achieving industrial diversification. Whereas relative neglect of technology based industries such as engineering and chemicals and very little consideration for the quality of products may have created very little demand for the skilled workers, supply of skilled workers has also been inadequate even to meet the demand which was generated.
Since Pakistan intends to move towards high-tech industries and the world scenario is changing in which export orientation will be the only viable strategy, quality of products will have to be improved significantly. This is possible provided there is an improvement in skill composition. In the absence of trained manpower the producers will make informal arrangements leading to sub-optimal decisions and low levels of productivity and the loss of output.
The formal institutional system produces a very small proportion of skilled and semi-skilled workforce. Even more importantly, the trained workforce in public sector institutions are not preferred by the entrepreneurs as they tend to believe that such training is not very useful. The poor ranking of polytechnic and vocational institutions by the producers reflect the fact that skills imparted fall short of the requirements of the producers.
Main beneficiaries of the skills improvement are the producers whose output, productivity and profits are expected to go up. However, despite dearth of skills, very little effort has been made by the producers to improve the skills of workers. It needs to be underscored that it would be counter-productive for a single producer to initiate such training as he may not get the benefit because the workers can move to the other producers. A cooperative effort on the part of the industrialists with active support from the government would be required for setting up such institutions. The institutions for specific industries would help in training in the relevant fields and to the satisfaction of producers.
{Continue…}
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COUNTRY / FIRM TEL / FAX / E-MAIL PRODUCTS/ITEMS
AFGHANISTAN
M/s. KW Global Inc.
Email: [email protected]
Porta-Potties (Portable Toilets) approximately 350 with spares and 4 million liters of toilet W/C Chemical,110 hand washing stations, and other cleaning supplies 45,000 kg detergent, 50,000 l bleach etc.
BANGLADESH
M/s. Pacific Enterprise Mr. Shahiduzzaman 5, Monipuri Par (G/Floor) Farm Gate, Dhaka
Tel: 00880-2-9146466 Mobile: 00880-1711020098 Email: [email protected] [email protected] , [email protected]
Wheat Rice Soybean oil skim milk
M.H.R.R Apparels Co. Md. Mhamud Khan Managing Director Road # 1/A, House # 97 (2nd Floor), Sugandha R/A, Panchlaish, Chittagong, 4100
Tel: 88-031-2550369 Mobile: 88-01819-394170, 01716-889743, 01912-563008 Fax: 88-031-2550370 Email:[email protected], [email protected], [email protected] URL: www.mhrr-apparels.com
100% Cotton Yarn Dyed One Side Brushed Flannel Cheque Design. 22X16/40X42 Width: 60" OR 57/58", qty: 25,00000 YDS
M/s. System Management Services Ltd. House # 400 (4th Floor), Road # 29, New DOHS, Mohakhali, Dhaka-1206,
Tel: 880-2-8856712, 8850969 Mobile: # 01711548080 Fax: 880-2-8850969 Email: [email protected] [email protected]
Rice 12500 M. Tons of IRRI-6
(12500 M. Tons with 15 -20% broken and 12500 M. Tons with 20-25% broken acceptable)
M.H.R.R Apparels Co. Md. Mhamud Khan Managing Director, Road # 1/A, House # 97(2nd floor) Sugandha R/A, Panchlaish Chittagong.
Tel: 88-031-2550369, Mobile: 88-01819-394170, 01716-889743 Fax: 88-031-2550370 Email: [email protected] Website: www.mhrr-apparls.com
100% y/d Flannel Fresh Fabrics.
EGYPT
M/s. El Eman Medical Dr. Hany Kamal Aly Hassainin 21 El Falaky Street, Bab el Louk, Cairo, Egypt.
Tel:002 02-7920693, 3700210, 3694877 Fax: 002 02 3360297 Email: [email protected] [email protected]
Medical Gas Pipeline Medical Equipment Oxygen flow meters Vacuum Regulators Medical Gas outlets
Bed Head Units Suction Jar 2+4 litrs
GERMANY
Mit freundlichen Grüßen M/s. Global Innovations Germany GmbH & Co. KG Ostkai 4, 54293 Trier
Tel: +49 (0) 651-9984995-0 Fax: +49 (0) 651-9984995-40 Email: [email protected] Website: www.direktimporte.eu www.globalinnovations.de
Towels (high quality products
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HONG KONG
Ms. Anderson M/s. Western Union Ent. Hong Kong
E-mail: [email protected]
100% Terry Towel
INDIA
M/s. Dhirish international, 28 old tharagupet Bangalore-560053 India
Tel: 0091-80-22878333-22870967 Mobile: 0091-9844012787. Fax: 0091-80-22873326 Email: [email protected]
Dry fruits Dry dates Kishmish
IRAN
Commercial of Manouchehr Angouti
Tel: +9821)77387089 Mobile: (98)9121140129 Email: [email protected]
Super kernel Basmati Rice
2000 tons Different Qualities: I.II & III
JAPAN
M/s. AIC Incorporated Mr. Masahiko Kubo Kannai-j isho Bldg. 502 6-68-1 Sumiyoshi-cho, Naka-ku Yokohama, 231-0013 Japan
Tel: 81-45-228-0007 Fax: 81-45-228-2821 Email: [email protected]
Dried Rose Flower
JORDAN
Muhammad Mansoor Khawaja
Email: [email protected] Air Conditioner Manufacturers
Quantity:-280 Units, Power: 12000 BTU, Split Hot & Cold
MAURITIUS
M/s. Raza International Export Ltd. Mr. A.Raza Mohamad 7 Remy Ollier Street, 1st Floor, City press Building Port-Louis Mauritius.
Tel: 208-4454 Cell: 259-8763/785-9431/784-0038 Fax: 433-4126 Email: [email protected]
White Rice with 25% and 15% broken 50kg. 25,000 m/tons with 25% broken 15,000 m/tons with 25% broken, 10,000 m/tons with 15%broken
SAUDI ARABIA
M/s. I.C.C.O.M.
Tel: 009661 4645848 Fax: 009661 4640674 Email: [email protected]
Military Supplies
The enquiries included in this Bulletin are received directly from the foreign individual importers or through Pakistan’s Trade Offices / Embassies
abroad. While every effort is made to ensure that the information given in this bulletin is accurate, no legal responsibility is accepted for any inaccuracy or omission. Parties are introduced without any responsibility or prejudice on
part of the Bureau regarding their standing or status.
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Dear Reader,
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