PRESENTED BY

• Iqra Hafeez Mi12bba014

• Hafiza Bushra Mi12bba020

• Ayesha Imtiaz Mi12bba043

• Rida Munir Mi12bba059

• Atifa Asghar Mi12bba060

Industrial & Manufacturing

Sector Of Pakistan

CONTENTS

• Pakistan Profile

• Economy Of Pakistan

• Introduction

• History

• Small Scale Industries

• Industrial Sector in Pakistan

• Causes Of Backwardness

• Steps ‘d Taken By Govt.

• Comparison With Other Countries

• International Economists View

• Islamic Economic System

PAKISTAN PROFILE

• Area 7,96,096 sq.Km

• Population 186.02 Billion

• Literacy rate 60%

• Per capita income 1,43,808 Rs.

• Un-employment rate 6.2%

• Revenues 29.71 billion$

• Expenditures 47.97 billion$

• 7th largest army

• Major industries

Particulars Billion US $ %age

GDP 236.5 4.14

Inflation 236.2 8.7

Agriculture 60 2.1

Industry 51 5.8

Service 129 4.3

ECONOMY OF PAKISTAN

INRODUCTION

• Industry refers to that sector of Economy which is related to manufacturing and production of products.

• Manufacturing is the key sector for the development of any Economy.

HISTORY

• Negligible Industrial base Economy

• 34 out of 955 units

• Industries of locally produce raw material

• Industrial finance corporation in 1948

• 6.9% to GDP in 1950

• Pakistan Industrial Development Corporation in 1952

• 11.9% to GDP in 1960

• By June 1971, 59 large scale unit by PIDC

1970’S

• Disappointing industrial growth from 1970-77

• Bhutto’s polices of Nationalization was the major cause

• GDP growth rate fell to 2.8%

1990’s

• After The Death Of General Zia,Structuraladjustments ‘re made in 1988-1999

• Growth rate boosted up to 8.1% in 1989

• Reduced to 4.7% in 1990s(first half)

• Reduced to 2.5% in 1990s(2nd half)

MUSHARRAF ERA

• Pak Eco witnessed many changes

• Per Capita Income Raised upto 1000$

• Low Interest rate bubble bursted

• In business 15% from 5%

• For Consumers 22%

ZARDARI ERA

• Global economies Experienced the worst Eco recession since the great depression of 30’s

• Demand for Pak goods Decreased

• Pak industries started to move towards Bangladesh

• Starving time

SMALL SCALE INDUSTRIES

DEFINITION

• Business that employs a small number of workers.

• Does not have a high volume of sales.

• Generally privately owned and operated sole proprietorships, corporations or partnerships.

FEATURES

• Legal definition of a small-scale enterprise varies by industry and country.

• Small-scale enterprises generally have fewer than 500 employees within a 12-month period in non-manufacturing industries.

IMPORTANCE

• Developing personal relationships.

• Responding flexibly to problems and challenges.

• Inventiveness and innovation

• Low overheads

• Catering for limited or niche markets

Industrial Sector In Pakistan

INDUSTRIAL SECTOR TODAY

• 23.93% of total GDP

• 13.3% to total employment

• 2.5% net foreign investment

• Growth rate of 5.8%

INDUSTRIAL SECTORS

Textile Industry Construction Industry

Auto Mobiles & Parts

Sugar Industry

Tele Comm. Industry

Surgical Instruments

TEXTILE INDUSTRY

THE MARKET

• Textile Industry is dominated by Punjab

• 3% of United States imports regarding clothing and other form of textiles is covered by Pakistan

• 60% of country’s total exports

• 38% of total employment

• 8.5% to GDP

• High contribution by tax (23.5 billions)

Issues

• Lack of research and development in cotton sector

• Lack of modernized equipment

• Increasing cost of production

• Internal issues

• Lack of new investment

Recommendation

• Research and development center

• Modernization in machinery

• Decrease in cost of production

• Energy efficiency

• Encourage entrepreneur

• New Techniques must be in process

Opportunities

• EU granted Pakistan Exports with reduce tarrifsunder GSP plus Status

• 3% of Textile ‘ll be exported in EU markets at 0 Terrif

• GoP has allowed tax-free & duty free imports of textile machinery to encourage capital investment

SUGAR INDUSTRY

THE MARKET

• In 1947 only 2 sugar mills

• Now 106 sugar mills operating in Pakistan

• 2nd largest industry after Textile

• Pakistan ranks 15th

• 1.9% of total GDP

• Provides employment to 1.5 millions

• Investment of 100 billion

• Pay 12.16 billion of taxes

ISSUES

• Lowest yield per hector

• Poor management and planning

• Poor quality

• Unable to meet domestic need

• Flood

• Smuggling

• Artificial shortage

RECOMMENDATIONS

• High yielding varieties should be introduced

• Government check that mills utilize their max. capacity

• Workshop for farmers

• Export of sugar surplus

• Investment in ethanol as a fuel

• Improvement in irrigation system

CONSTRUCTION INDUSTRY

CONSTRUCTION INDUSTRY

• Drivers of economic growth.

• Construction and material industry has grown at a pace of 5.2%.

• Contributes 11.42% in the overall industrial sector.

• Projection is 10% growth in the fourth quarter of 2014-15.

THE MARKET

• 4 plants in 1947

• 0.5 million ton capacity in 1947

• Now 29 plants

• Capacity of 44.09 million ton

• Total domestic market 19 million ton

• 3.5 % contribution in GDP

CHART

2.9 3.26

6.01

9.56

11.67

4.3

11

13.6

17.3

21.6

0

5

10

15

20

25

2010 2011 2012 2013 2014

Production in tons

Consumption

ISSUES

• Shortage of coal

• Competition with India and china

• High rate of taxes ( 96 PKR per 50 kg)

RECOMMENDATION

• Utilize Reserves of coal

• Revised taxation

• Stability of Pak rupee

• Duty free Pet Coke

AUTO MOBILES & PARTS INDUSTRY

THE MARKET

• No inherited industry

• First automobile produced in 1953

• Pak Suzuki in 1984

• Toyota in 1993

• Honda in 1994

• Hyundai in 1999

THE MARKET

• 5.6% of GDP

• Investment of 20 billions

• Employment to 1,92,000 directly

• Indirectly 1.2 million

• 2nd largest tax payer, 63 billion of taxes

ISSUES

• Input cost

• Scarcity of raw material

• Competition with imported cars

• Fuel prices

RECOMMENDATION

• Import German technology

• Foreign investment

• Ethanol fuel

• Strict import policy

• Decrease taxation

SURGICAL INDUSTRY

THE MARKET

• 17 inherited units in Sialkot

• Now 2500 units

• Exports of over USD 270 millions

• Employment to 1.5 lakhs people

• 1% to GDP

• 1.21% of total exports

ISSUES

• Technology

• Marketing

• Human resource

• Research and development

RECOMMENDATIONS

• Consultancy for branding and international marketing

• Broaden the sphere of industry

• Fill human resource gap

• BOI to facilitate joint ventures

• Technological up gradation

TELE-COMMUNICATION

INDUSTRY

THE MARKET

• In 2008 Pakistan was the world’s 3rd fastest growing Tele market

• In 2012 ,Telecom sector contributed PKR 133 billion

• Pakistan is now a leader in mobile usage in south Asia

• Currently Pakistan's global share is estimated at USD 2.8 billion

• Total number of IT companies increased to 1306

OPPERTUNITIES

• Stretching the broadband services

• Reliable IT infrastructure

• 6% to GDP

• Income tax exemption till 2016

CAUSES OF BACKWARDNESS

PEST ANALYSIS

POLITICAL CAUSES

• Political Instability

• Kashmir and Water Issues

• Burden of Refugees

• Wars with India

• MFN to India

ECONOMICAL CAUSES

• Disputable Industrial Strategy

• Lack of Mineral Resources

• Low Investment and Low Savings

• Inflationary Pressure

• Frequent Breakdown of Electricity

• Economic Sanctions

SOCIAL CAUSES

• Lack Of Education

• Faith & Fate

• Corruption

• Climate & Weather

• Cultural Disturbance

Technological Causes

• Lack of Industrial Research

• Lack of Technical Know-How

• Lack of Infrastructure

• Lack of Industrial Consultancy Firms

SUGGESTIONS

SUGGESTIONS

• Resolve energy crisis

• Loans on easy installments

• Improved quality of goods

• Tax Concession

• Foreign Investment

• Use of advanced technology

COMPARISON WITH OTHER COUNTRIES

GDP GROWTH RATE

0

1

2

3

4

5

6

7

8

9

GDP Growth Rate

4.3

8.2

7.2

6.1Pakistan

China

India

Bangladesh

PERCENTAGE CONTRIBUTION

23.93

26.30

28.5

46.9

32

Contribution Towards GDP

Pakistan

India

Bangladesh

China

Sri Lanka

INTERNATIONAL ECONOMISTS VIEW

JIM O’NEILS PROJECTIONS

• Currently Pak is 44th largest economy in the world

• Pakistan ‘d become 18th largest & 55th in factory output

• GDP will be grow 15 times in next 36 years

• Inflation ‘d be reduced to 8.2%

ISLAMIC ECONOMIC SYSTEM

QUAID E AZAM VIEW

• Three things ‘d be done

Do Justice

Do Good To Others

Extended Charity

THREE THINGS ‘d NOT BE DONE

No Act Of Coercion

No Interest

Obscenity