|
|
 |
| |
| Pakistan |
| Guide
to the research |
December 2002.
Prepared by
H.D.C.D Gunasekara.
B.Com (International Trade)
University of Sri Jayawardenepura.
For the
Marketing Division
Sri Lanka Export Development Board.
42, Navam Mawatha,
Colombo 02.
Sri Lanka.
Tel : 300705-11,
E-mail : mktd@edb.tradenetsl.lk
Web :
www.tradenetsl.lk
Research inquires:
Mrs. Anoma Premathilaka.
Tel: 300726 / 7
E-mail: anoma@edb.tradenetsl.lk
ISBN 955-98236-0-4
|
Values in this report are in
Pakistan Rupees (PKR), US $ and Sri Lankan Rupees (LKR).
On 31 December 2002, PKR was equivalent to LKR 1.6549
and US $ was equivalent to LKR 96.8660 |
| Trade Statistics and other
information in this report are sourced from various institutions,
publications and the Internet. Whilst every care has been
taken in preparation of this report, no responsibility
is taken for any errors, in respect of the information
obtained from outside sources, mentioned in the research. |
| |
| Acknowledgement |
Many dedicated people have assisted
me in producing this market research study in a
successful manner.
My first sincere appreciations go to the Chairman
and the Director General of the Sri Lanka Export
Development Board for providing me the opportunity
to carry out this research study.
I am very much thankful to Ms. L.R Tudugala, Director
Marketing, SLEDB for the guidance and directives
provided by preparing and giving the framework for
this study and also for her overall supervision
of this study without which the outcome of this
research would not be a success.
I would express my deep gratitude to Ms. Anoma Premathilake,
Assistant Director/ Marketing, SLEDB who took a
great deal in guiding and supervising me to carry
out this research study successfully.
My sincere gratitude goes to Mr. Tanveer A Khaskheli,
first secretary, High Commission for Pakistan in
Sri Lanka, who gave me enormous support by providing
valuable information and publications of Pakistan.
Special thanks should go to the entire staff of
the TradenetSL, EDB, for granting me the computer
facilities and co-operation made during the study
period.
I also extend my gratitude to Mr. P Darmadasa, Lecturer,
University of Colombo for his guidance and Mr.D.K.
Sisil, Computer Programmer in Trade Information
Service of SLEDB, who was kind enough to take time
off from his busy schedule to provide me the necessary
statistical data.
Further thanks are due to the Ceylon Chamber of
Commerce, Department of Commerce, Board of Investment
of Sri Lanka, National Packaging Center and Sri
Lanka Tea Board, for the support where deserved.
Last but not least, I should thank all the private
sector organizations that supported me by giving
invaluable information based on their experience
on the Pakistan Market.
H.D.C.D Gunasekara.
B.Com (International Trade)
University of Sri Jayawardenepura
December 2002.
|
|
| |
| Executive Summary |
At a very broad level Sri Lanka’s
export growth performance over the period 1990 to
2001 is not satisfactory enough when compared with
the dynamic East Asian developing countries.
Sri Lanka’s total world exports have remained
small. In addition to this, declining prices for
key exports have eroded dollar earnings. As a result
Sri Lanka’s share in global exports has not
increased. But there has been little diversification
of exports both in terms of commodities exported
and the direction of exports.
In the light of growing awareness about the importance
of exports for a developing country like Sri Lanka,
an in-depth analysis of the export market opportunities
is essential for any meaningful future planning.
Since there is no research has been done so far
on Pakistan market, as a first step towards this
great requirement, the Marketing Division of the
Sri Lanka Export Development Board has decided to
carry out a market research study on Pakistan, which
is currently focused with the concept of strengthening
trade co-operation among the member countries of
SAARC, particularly with Pakistan through Free Trade
Agreement.
This report is divided into eight chapters including
conclusion and recommendations. The first chapter
gives a brief overview of Pakistan. Pakistan is
an Islamic Republic, situated in Southern Asia.
Islamabad is the Capital. More than 50 percent of
the total land area of Pakistan is used for the
Production.
The total population of Pakistan is reported as
147 million in year 2001 and about 56 percent is
living in Punjab area. More than 97 percent of Pakistanis
are Muslim and there are twenty or more spoken languages.
Punjabi is the regional language with the gravest
number of native speakers.
Pakistan’s social indicators need improvement.
The literacy rate at present is estimated at 47
percent. The Social Action Programme was launched
with a view to improving access to basic social
services like primary education, primary health
care, population welfare services and potable water
and sanitation.
The second chapter gives a detailed picture of Pakistan’s
Economic Indicators. It would be observed that the
overall economic activities slackened considerably
during the last three years.
The Gross Domestic Product at current factor prices
was US $ 55.78 billions for the year 2000-01 and
GDP Growth Rate was 2.6 percent during that period
while GDP per capita being US $ 397. Therefore the
long term sustained GDP growth requires strengthening
of the competitive foundations of the economy to
capture a larger share of the world market. GNP
has grown by 2.3 percent and the nation’s
Per Capita Income currently stands at PK RS 22,512.
The shares of the components of the GDP have changed
over the last decade.
Production sector and the services sector contribute
equally to the Pakistan economy. Public Savings
showed exceptionally high growth of 337.7 percent
during FY2001.The Rupee / Dollar parity has weakened
dramatically by 18.6 percent during FY2001.
The government’s growing indebtedness has
become the gravest problem faced by the country.
The stock of the total debt has exceeded Pakistan’s
GDP; income Per Capita is lower than per citizen
indebtedness. This accumulated public debt is the
result of structural weaknesses in the domestic
economy and the external account.
Labour force has grown at an annual rate of 2.7
percent and more than 44 percent of total work force
contributes to the agriculture sector. The rate
of unemployment was at averagely 6 percent over
the last five years.
Part two of this chapter explains the economic affairs
of the Pakistan. It elaborates the performance of
major agriculture sectors. Their major crops include
Sugarcane, Cotton, Rice, and Wheat. Minor crops
holds 17 percent share in agriculture sector, which
include fruits and vegetables. Textiles are the
main manufacturing item of their economy. Although
the government is making efforts to increase foreign
investors to invest in Pakistan, efforts have remained
unsuccessful. Pakistan’s investment policies
are more liberalized and business friendly.
Third chapter analyses the Pakistan’s foreign
trade. This has divided in to two parts. i.e. Trade
with world and Trade with Sri Lanka .
At a very broad level, Pakistan’s export growth
performance over the last 10 years was well. But
the Balance of Payment has always been in deficit.
Petroleum and its products contribute the single
largest category of imports in Pakistan, accounting
around 20 percent of total imports. Other import
products include machinery, Transport equipments,
Chemicals, Edible oil, Iron & Steel and raw
sugar. Major suppliers are Saudi Arabia, Kuwait,
Japan, U.S. and Malaysia.
The value of Pakistan exports rose by 6.7 percent
in 2000/01. Textiles, Rice and other agricultural
products have been contributing much to their export
earnings. The great majority of Pakistan export
items are sent to the US & to the Western Europe,
which absorbs more than 50 percent of goods sent
by Pakistan to world.
The second section of this chapter consists of an
analysis of import and export between Sri Lanka
to Pakistan. The trade balance between Sri Lanka
and Pakistan has always been in favor of Pakistan.
Sri Lanka’s export earnings from Pakistan
fluctuated dramatically during the last 10 years,
while imports followed an increasing trend. This
section is comprised of a brief analysis of major
export and import items to the Pakistan market.
Nearly forty percent of the total exports are comprised
of coconut and coconut products. Out of this the
large potion (28%) is covered by copra. Other major
export items include tea, rubber and spices. Fish,
cotton, rice, onions and medicaments are the major
import products.
South Asian Preferential Trading Arrangement was
a major step towards higher levels of trade and
economic co-operation in the South Asian region,
which includes Pakistan as well. The most notable
development in the commercial relations between
Sri Lanka and Pakistan is the proposed Free Trade
Agreement (FTA), which is schedule to be finalized
in near future.
The fourth chapter contains an overview of the Pakistan’s
tariff structure and barriers to trade. According
to the US ‘National Trade Estimate Report
on Foreign Trade Barriers’ the Pakistan tariff
regime is characterized by complexity, broad bureaucratic
discretionary powers and very limited transparency.
This report has illustrated several trade, service,
investment and other barriers of this market.
The information on transportation and communication
within Pakistan as well as the freight rates between
Sri Lanka and Pakistan are included in the fifth
chapter.
Finally, the sixth chapter contains the opportunity
analysis, which is the most important section in
this report. First part of this chapter reviews
the performance of the top ten product categories
exported to Pakistan. This analysis includes details
concerning fluctuations in quantities, values and
volumes, comparative growth rates of Sri Lankan
exports to Pakistan and to the world, Pakistan imports
from other countries and the performance of the
Sri Lankan exporters to that market. Those product
categories are classified in 8 digit Harmonized
System codes.
Copra has continuously been a top foreign exchange
earning product for Sri Lanka in Pakistan with US
$ 6783,000 in year 2001. The other major products
that are exported from Sri Lanka to Pakistan include
tea, natural rubber, betel leaves, coconut products
and spices.
The second part of the opportunity analysis indicates
the result of the preliminary study on Pakistan
imports from the world. Import trade statistics
for this analysis were obtained from the publication
“FBS December 2000” which was published
by the Federal Bureau of Statistics, Government
of Pakistan. Potential Products identified through
the analysis of import statistics of Pakistan comparing
exportable products of Sri Lanka have categorized
under following six sections and recorded on the
basis of Standard International Trade Classification
(SITC). |
| |
| 1. |
Currently exported & Sri Lanka is the
main exporter of these goods to Pakistan. |
| 2. |
Currently exported but the present level of
exports could be further increased |
| 3. |
Potential
/ exportable products for Sri Lanka (but currently
not exported or exported in small quantities)
– classification is based on the products
that are included in the ‘exportable
product list’ of the EDB. |
| 4. |
Currently
not exported but Sri Lanka has exported in
year 1999 even in small quantities. |
| 5. |
Products, which have high demand in Pakistan
– based on import statistics of Pakistan. |
| 6. |
Products
that are exportable according to the product
list of the EDB; however the market is small
in Pakistan for these products – according
to the import statistics of Pakistan. |
|
|
|
| |
| |
|
|
