Trade, can it Herald Peace?

Talking about the business and nothing but the business the greatest hurdle to Pakistan declaring India as MFN is the fear that India will dump its inferior quality products in Pakistani market. In a country where manufacturer is breathing his lasts gasps under the choke hold of WTO that would mean the end of manufacturing sector in Pakistan. The problem is actually bigger than dumping - it is the abscence of legislative body in Pakistan. For the past 5 plus years there hasn`t been any legislation in this country. Not one law has been passed in that time - except that of National Security Act that was passed in a blatantly shameless way. No body knows what the constitution of the country is. Left hand doesn`t know the right. We cannot legislate anti-dumping laws in our country. Even if we impose the requirement of ISO9000 certification for import, it wont prevent Indians from dumping. So unless our fauji dictators want to be held responsible for the collective suicide of our manufacturing sector, they wouldn`t do it. But that is a smart thing to do, and such smartness is not expected of them so one can never tell what they might do; especially when with an unglee from big satan they are ready to sell their mothers what to talk of a country.

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i`m not a trade analyst, but it doesn`t make sense that pakistanis are willing to pay twice the price that we pay in india for the suzuki 800 just cause...i don`t know it doesn`t make sense to me??????.And the little tin box is an entry level car in india while i read that in pakistan the middle class aspire to own one and actually wait for delivery.In india they`re actually giving them away at Rs.2599.00 monthly payment.If indian made autos can be sold and exported overseas why can`t you buy them and save money,promote trade and provide employment for more people.Witness NAFTA.I guess we indians are asking too much of a feudal,bigoted nation.Sorry.Meanwhile bangladesh, srilanka nepal and bhutan are already seeing the fruits of economic cooperation with one of the top ten economies of the world, a member of the G-20 group and the world`s 6th largest nation, the world`s largest democracy and the country with the 3rd largest armed forces and the 3rd largest airforce, namely INDIA.I hate to gloAT, but i will.

All interaction to follow under this article can be simplified by the following labels:

``Mine is bigger then yours``
``We are much better on this side of the divide``
``Dick measuring contest``
``Me better, you inferior``

The list is long but the idea is the same.

Asfand

Hello Aman!!

There already is lots of trade between India and Pakistan. Trade which would otherwise be classified as ``legal`` as well as other stuff wich is ``illegal``. Let us take only that which could be classified as ``legal``?

The reality is that this ``otherwise legal`` trade goes through various levels of inefficiency, agents, via-medias, clearing houses etcetc., mostly non-governmental. These levels of inefficiency do not reduce the trade, in strict terms, but ``add value`` for those in between. And lights shine brighter in, say, Sharjah?

Now let us assume that all legitimate trade between India and Pakistan overnght went through ``normal official channels``? Do you know what activity and despair there was in some parts of the world when, for example, gold came into legal channels into India a few months ago?

What, Sir, would happen to those benefitting from the artificial levels of inefficiency brought in between if all potentially ``otherwise legal `` trade started suddenly flowing through government channels?

Yes, we would get vast media reportage on corrupt Customs officials and other such hindrances. But atleast some revenues would flow to Government coffers?

There is enough trade between India and Pakistan already, the only thing is that the ``value added`` goes to private pockets. Why would these ``private pockets`` let go, will it be that easy? The best bogey is to put the fear of India in the consumers mind. Sure, but what are the truths?

Today, the Daewoo Motorway in Pakistan, and the Daewoo buses plying on it, is owned by Tata. The tea they drink is Tetley (another Tata company). The first really big new hospital in Pakistan, 1 billion dollars, is going to be Indian, at Sheikhupura. The city-buses at Varan Transport showing lables of HinoPak are Ashok Leyland. The stolen vehicles which become taxies are from India. The movies pirated are from Bombay. The next big pipeline will be by Reliance. Aviation fuel is bought from Jamnagar. The secondary market of pavement goods is largely Indian. The profits of the liquor trade alone could bankroll a small nation. Even the paan masala is from India. Hyundai Santro cars are from Chennai.

Frankly, IMHO, India has to do nothing but make its goods available, at a reasonable price and decent quality. Which it does. Now it would be up to the Pakistanis to decide if they want to buy direct or through via-medias in other countries tripling the prices.

Urstruly,

Please stop writing about economics and stick to something you might actually know something about (not sure what that might be but must be something you know...).

Veeresh`s #6 is quite interesting. Had no idea of the amount of ``trade`` that actually takes place and the number of Indian goods available in Pakistan. I knew there was a certain amount of smuggling but this much?

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Dear Mr Malik,
Please contact me at amanmalik000@hotmail.com
Sir, we are related... your late father Col Malik, was my grandfather Bhagwan Dass Malik`s First cousin... by that acount you are my dad`s cousin!!!
PLEASE MAIL ME...have not been able to get your id from Dr A.C. Malik, my dad`s elder brother...
Please do contact me sir...
Aman Malik

Manufacturing infrastructure,

In the past years, ever since mushy came to power there have been three capital raisings in the pak stock exchange. The NAB have killed off all of industrial activity in pakitan, the textile tycoon was arrested. Textile account for 70 percent of pak exports. There is no industries worth any name unless they are owned by the military. From cement to corn flakes are made by the military. There are reports that some of the weapons facories are makin frodges and other white goods.
Any type of increased trade, that lowers the price in pakistan is bad for the military indutry. India should support the war onj terror by slowly cutting of the economy of pakistan. May be bhutto was wrong, it whould have been pakistanis will stuff cotten every where, but will have the bomb.

santro cars are not from chennai -- veeresh sahib as usual you fail to understand things and bases everything on your presumptions -- hyundai must have a plant in chennai but the cars in karachi or lahore are not from that plant but from the one outside karachi -- ever heard of joint ventures? hyundai has one with dewan motors in pakistan and thats how we get our santro cars -- hinopak is another example - joint venture with a japanese firm -- might look like an ashok leyland but isnt the same thing -- as for tetley tea -- again a joint venture between tetley UK and a local pakistani firms -- read below plz -- it seems your patronizing comments will never stop -- about how big-hearted india is and how pakistan is refusing to either acknowledge such big-heartedness or how Pakistan chooses to ignore it -- arjun m -- your nothing but a pure paki-basher so would be silly to reason with you -- but one thing, no pakistanis are not genetically predisposed to buying inferior goods -- its just that big business tends to take consumers for a ride, just like elsewhere -- tell me something arjun, are indians `genetically predisposed` towards prejudice and bias against pakistan? -- and lest i be accused of starting something, plz for the record see that it was mr arjun here who couldnt help make a dig at pakistanis and their `genetic predispositions` -- seriously i am beginning to wonder whether the editors at chowk deliberately try to encourage such interaction by letting such attacks go through on the board



Tetley tea to hit market in first quarter of `04


By Aamir Shafaat Khan

KARACHI, Dec 30: Tetley Clover Private Limited (TCPL) is now planning to introduce Tetley tea in Pakistan in the first quarter of 2004, hoping to capture six to eight per cent share in a market dominated by Unilever and Tapal Tea.

As per previous market reports, based on company`s various executives` comments, Tetley tea was due to hit the market in October 2003 but it had been delayed. According to market sources the delay was caused by late shipments of blending plant and machinery from abroad at Hub, Balochistan.

However, TCPL managing director Zulfiqar Ali Lakhani told Dawn on Tuesday that ``actually October was not the specific time period for the product`s commercial entry.`` ``The new tea is now arriving in the first quarter of 2004,`` he said without giving any specific date of the product launch.

``Our project is well intact and there is virtually no delay in the operation,`` he said adding that the launch of new tea had never been planned for October 2003.

On the market apprehensions that Indian tea giant Tata is actually arriving in Pakistan with a UK based Tetley Tea as its front, the TCPL managing director said Tetley Clover is jointly owned by a combination of interests from the UK and Pakistan.

``It has two British and one Pakistani origin British citizen as Tetley director besides the Lakson`s nominated directors,`` he said. Tata, being a substantially big industrial group, succeeded in bidding for acquisition about two years ago and now has a majority shareholding in Tetley UK, he added.

``Tata, does not, however, has any involvement in the management of the joint venture. The joint venture is being entirely operated by executives drawn from the UK and Pakistan,`` Zulfiqar Lakhani said.

Lakson Group and Tetley UK had entered into a joint venture investment of Rs150-170 million in 2003 to form TCPL, a company incorporated in Pakistan. On price, he said the company is likely to keep the prices of tea at par with its competitors.

A stiffening competition in tea business is likely to be witnessed as the TCPL, in its first year of operation, aims to capture six to seven per cent share from two existing tea giants.

Unilever`s January-September 2003 sales and operating profit surged to Rs7 billion and Rs919 million from Rs6.6 billion and Rs900 million in the same period of 2002. Unilever`s sales by the end of 2003 is likely to range between Rs9-10 billion followed by Rs1.2-1.3 billion operating profit. Another strong contender Tapal also enjoys yearly sales of Rs4.5-5.0 billion.

Tetley Clover has planned to import tea from Kenya and Sri Lanka due to good aroma and taste of tea of these countries,`` he said adding that the company may also use Indian tea for blending.

Pakistan, being the third largest tea importer of the world, mainly imports tea from Kenya, Bangladesh, Sri Lanka, Indonesia, China and some African countries. In 2002, the country imported 97,827 tons of tea ($146 million) as compared to 107,000 tons ($175 million) in 2001. Local tea market comprises 45 per cent of loose tea and 55 per cent of packed tea.

Trade and terror,

News items say that most of the consumer goods in pakistan are expensive compared to that in india. Take pharmasuitical drugs, they are around ten times more expensive, it is because the manufacturers, the middle men are siphoning the profits. The same with other consumer goods and it is the final consumer the poor who is carrying the burden. The exhorbitant profits have created the very rich of pakistan and has increased the demand for luxury goods. This is what typically takes place in every islkamic countries, poor and the very rich, the rich create the demand for imports which consumes the foreign exchange, while the domestic indisutries for consumer goods cannot flourish because of the low demand from the poor, in the case of pakistan, from the increasing number of the poor.

In the above circumstance as in pakistan, lower price of goods, made available through imports will increase the disposable income of the poor. This will be diverted to contributions to the mullah at the mosque, to the collection boxes, to the trip to madreke to meet the laskers.
Low cost imports to pakistan will be bad for india, it will be bad for pakistan and it will be very good for the jihadis, that is bad for the world and terrible for man kind.

No there should be no trade with pakistan, but is OK as long it is trding of bullets, may one sided dropping of daisies of the cutter variety.

#12 Omar

Veeresh may not be quite right when he says ``Indian made`` Santro cars, but the truth probably lies in between. Most cars today contain ``globally sourced`` components and assemblies. Hyundai`s Chennai plant and its vendors are a global hub for small car assemblies so I am pretty sure any ``Santro`` or ``Santo-like`` car made by Hyundai anywhere in the world has a pretty good chance of having ``Indian-made`` assemblies in them.

Hyundai has a new small car called ``Getz`` which is on sale in UK and Australia. There is talk about introducing it in India and whether India will be a hub for assemblies for this car.

Similar arguments on Hino-Pak issue. It would make great sense for it to have, say axel rods from Bharat Forge or engine blocks from Ashok Leyland. If this is indeed the case or Pakistani`s have made the ``strategic`` decision in the ``nation interest`` I dont know.

(If someone is more knowlegeable about the Pakistani automobile industry or has taken their Mehran-Suzuki or Hyundai-Pak apart please chip in)

btw, Tetley UK is owned by TATA`s.

Recently, I had a dubious honor of meeting with some people at a social gathering, who were in textile business and called themselves Cloth merchants – wholesalers and retailers. According to them India has already started dumping its textile products in Pakistan, especially un-sewn cloths. I asked them why they carried an Indian product anyway while we have one of the best textile product-line in the world. One of them replied that India is dumping clothing products at a price, which presumably is well below their own cost. This enables them (the cloth merchants) to offer ridiculous amount of discounts to their customers. The customer base in this line of business is overwhelmingly female. Even for males the buyer is female (they have to chose among gray, beige, and off-white anyway). And it is in the psychology of female customer that she won`t pick up merchandised unless she bargains it and gets discounts. Therefore, they argued that, an Indian product is easier and profitable to sell. Another gentleman who was not in the clothing business and holds a very low opinion about mother and sister of the government (any government) argued ``bha ji, at least now poor people would be able to buy with some relief, this (expletive) government, on the other hand, is determined to starve people (expletive)``.

I argued that if we let it go on like this, it would effectively eliminate the local competition for good. Our counter-dumping in India might not work because our quality products are out of reach for Indians masses anyway. ``So what would happen after couple of years?`` I asked. ``What would happen to the cotton growers, synthetic fiber makers, textile mills, workers and engineers who work there, textile equipment manufacturers,……..but you guys will be making money anyway, right?``

In reply they just shrugged.

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