Anda di halaman 1dari 32

PLASTIC PRODUCTS CLUSTER - LAHORE

DIAGNOSTIC STUDY
Prepared by
Hamid Minhas (Regional Business Coordinator)

Turn Potential into Profit


Small & Medium Enterprise Development
Authority
Ministry of Industries, Production & Special
Initiatives
Government of Pakistan
http://www.smeda.org.pk
8th Floor, LDA Plaza, Edgerton Road Lahore
Tel: +92-42-111-111-456
Fax: +92-42-6304926-27
Email: hamidm@smeda.org.pk

Diagnostic Study on Plastic Products, Lahore

The views expressed in the Diagnostic Studies are those of the


authors and should not be attributed to UNIDO or to the
institutions they may represent.

SMEDA_UNIDO Cluster Development Programme Pakistan

Diagnostic Study on Plastic Products, Lahore

TABLE OF CONTENTS
Introduction
What Is Plastic
Characteristic Of Plastic
Possible Uses Of Plastics
The Growing Market
Plastic Industry Global Perspective
International Trade Statistics
The National Scenario
Market Overview
Market Players
Consumption & Imports
Benchmarked Cluster
Lahore Cluster
Analysis Of Business Operations
Business Status
Social & Regulatory environment
Finance
Human Resource
Raw material Procurement
Product Sale
Process Flow
Extrusion Molding
Injection Molding
Blow Molding
Core Cluster Actors
Manufacturers
Recycling Of Plastic
Raw Material & Chemical Suppliers
Machinery Suppliers
Mold & Die Makers
Traders / Wholesalers / Distributors
Component Industries
Interest Groups
Pakistan Plastic Manufacturers Association
Lahore Chamber Of Commerce & Industry

SMEDA_UNIDO Cluster Development Programme Pakistan

Diagnostic Study on Plastic Products, Lahore

Support Service Institutions


Financial Institutes
Pakistan Standards Quality Control Authority
Technical Education & Vocational Training Authority
Injection Molding Technology Development Project
BDS Providers
Engineering Development Board
Small & Medium Enterprise Development Authority
Export Promotion Bureau
Large Organizations
Environment Protection Agency
Lahore Development Authority
Punjab Small Industries Corporation
Export Processing Zones Authority
SWOT Analysis

Strengths
Weakness
Opportunities
Threats

Cluster Map
VISION
Action Plans
Annexure
10 Things about Plastics everyone should Know
PET Bottles Manufacturing Process Flow

SMEDA_UNIDO Cluster Development Programme Pakistan

Diagnostic Study on Plastic Products, Lahore

INTRODUCTION
What Is Plastic?
A plastic is a type of synthetic or man-made polymer; similar in many ways to natural
resins found in trees and other plants. Webster's Dictionary defines polymers as: any of
various complex organic compounds produced by polymerization, capable of being
molded, extruded, cast into various shapes and films, or drawn into filaments and then
used as textile fibers.
Plastics are used because they are:

Attractive
Hard
Soft & Rubbery
Easy to Clean
Flexible
Good insulators of heat or electricity
Light weight
Hygienic
Easy to Shape & Color
Economical

Apart from some of the properties of plastics mentioned above, one important feature of
plastic is that it is a non-rusting material, which makes it a very usable commodity
especially in coastal areas where there is a lot of humidity.
As stated earlier, the use of plastics is increasing all the time as they replace materials
such as metal, wood, paper, ceramics and glass in a wide variety of uses. More over
the overall demand and local supply gap that prevails in the market remains largely
unmet which also provides opportunities for entering in to this business

SMEDA_UNIDO Cluster Development Programme Pakistan

Diagnostic Study on Plastic Products, Lahore

Possible Uses of Plastics:


The end-users of various categories of plastic material & processed goods are given
below:

SMEDA_UNIDO Cluster Development Programme Pakistan

Diagnostic Study on Plastic Products, Lahore

The Growing Market for Plastics:


Durable, light-weight and corrosion - resistant plastics are increasingly being used in
place of wood, steel and other traditional materials. An array of new uses and new resin
technologies will continue to expand the market for plastics during the 2000s.

SMEDA_UNIDO Cluster Development Programme Pakistan

Diagnostic Study on Plastic Products, Lahore

PLASTICS INDUSTRY - A GLOBAL PERSPECTIVE


The plastics processing industry is prominent in every aspect of modern life. As new
polymers and composite materials are introduced by the chemical industry, so the
industry is constantly refining and adding products to those that have been made over
many decades. In its early years, the plastics industry greatly benefited from the
substitution of plastic for other materials including various metals, wood, paper, glass,
cardboard and natural fibers, etc. However, as a mature industry, the possibilities for
substitution are limited, leading to greater dependence on economic growth and the
expansion of demand in plastic's existing markets. The industry is also vulnerable to
volatility in the global price of oil and gas feed stocks, used by the chemical industry to
produce its raw and semi-finished materials.
The leading markets for plastics are in packaging, building and construction and the
automotive/transport industries, all of which have generally been buoyant. However, a
number of other industries which use some form of plastic, e.g. the textile, clothing,
electrical, electronic, mechanical engineering and agricultural industries, have
experienced a profound downturn in demand, as they struggle to adjust to changes in
the market for their products and against a rising tide of imports.
Overseas competition from the advanced developing countries is having an impact on domestic
demand, as cheap imports of relatively low added-value products are causing some parts of the
worlds plastics industry to restructure. A number of companies have relocated their
manufacturing facilities to these low-cost countries and have themselves become importers.
The rising cost of the polymers used by the plastics processing industry has made many of its
customers resist the inevitable price increases that follow and led them to seek alternative
sources of supply, wherever possible. Plastic processors are also seeking cheaper material
suppliers and this downward spiral has led to the closure or suspension of production at several
plants. Acquisitions and Consolidation continues to play an important role in plastics businesses
all around the World.

International Trade Statistics:


For 2003, United Nations trade statistics show exports of plastics in primary form to be
more than$ 72 billion. Seventy countries reported trade in plastics in 2003. The top
exporting countries were the United States, Germany, Belgium, China (Hong Kong
SAR), France, Canada, Italy, Singapore, Sweden, and Malaysia. The Unites States is
the largest exporting country; the Peoples Republic of China is the largest importer. The
value of exports in 2003 is below the levels for the previous three years due to the
world-wide economic downturn. Exports for 2000-2002 averaged more than $ 90 billion.
Other supplier countries are South Korea, Saudi Arabia, Thailand, Japan, Germany,
Hungary, China and Belgium, which dominate the import market because of lower
prices, transport costs and shipment time. However, the respective share of each
country has varied. For example, the market share of Hungary has fallen from 11.4 per

SMEDA_UNIDO Cluster Development Programme Pakistan

Diagnostic Study on Plastic Products, Lahore

cent to 3.2 per cent. Similarly, the share of Thailand has jumped from less than 1 per
cent to over 7 per cent during the period of six years.
THE PAKISTANI INDUSTRY SCENARIO
Pakistan's economy achieved an impressive GDP growth rate of 8.4% in 2004~05, the
highest in two decades and the third fastest growing economy in Asia. Powering the
economy with its superb performance, the manufacturing sector accounted for 18.3% of
GDP while registering a growth of 12.5%. The co-related industries of Plastic, Printing &
Packaging have registered a phenomenal growth during the past few years where
printing and graphic arts industries are the second largest industries in terms of work
force in Pakistan.
Pakistan's plastic industry is thriving at an average annual growth rate of 15% with a
total estimated production capacity of 624,200 M/T per annum. The industry attracted
investment amounting to more than US$ 260 billion, almost half of which was foreign
direct investment (FDI), all contributing to an exceptional export growth by 35%.
Automotive, cosmetics, toys, chemicals, stationery, paper & board, electronics, food,
publishing and furniture are some of the major industries utilizing materials and state-ofthe-art related equipment and technology to increase output and meet increasing
demands in domestic & foreign markets.
Adding further strength to the industrial progress, Pakistan has established successful
export markets for its plastic goods. In foreign markets including countries like Australia,
South Africa, Saudi Arabia, West Indies, UAE, Kuwait, Taiwan, Nigeria and Zimbabwe;
Pakistan is strategically well placed to target the all-important local and international
buyers in one of the world's largest trading regions.
Particular growth is being seen in exports of plastic components for the automobile
industry. This growth happened, besides entrepreneurial efforts, due to simplified tax
policy on local production and reduction in import tariff on plastic raw materials. The
industry is contributing more than Rs7.5 billion annually to the national exchequer in
shape of custom duty, sales tax and income tax. Its contribution to the gross domestic
product (GDP) was 1.69 per cent.
It is a high tech industry; plastic processing machinery is mostly imported from Japan,
Korea, Italy, Taiwan, Hong Kong, England, China and Germany. However, locally
manufactured machinery is also being used. Raw material is also imported.
The capacity utilization has been in between 43 to 95 per cent. Plastics industry in the
un-organized sector is totally self-financed. Export share in total exports was 0.163 per
cent. The industry is presently split into organized and un-organized sectors. About 60
per cent of the units are located in and around Lahore and the remaining at Karachi,
Hattar, Gadoon, Faisalabad, Multan and Quetta.

SMEDA_UNIDO Cluster Development Programme Pakistan

Diagnostic Study on Plastic Products, Lahore

The organized sector is capable of producing quality products whereas the unorganized
sector produces low quality, cheap products through excessive use of plastic scrap.
During the last decade, the unorganized sector has grown much more rapidly then the
organized sector.
Market Overview
The per capita consumption of plastic in Pakistan is 3.1 kilograms, while this is 3.3 kg in
India and 7 kg in China. The highest per capita consumption of plastic is in United
States and Germany, where per capita consumption is 120 kg per annum. Globally, the
per capita plastic consumption works out to be around 24 kg per annum. The
consumption of plastic is less in Pakistan as the local industries are not developing as
rapidly as they are growing in the other parts of the world.
Market Players
There are some 6,000 plastic products manufacturers in the country and 600,000
people are directly and indirectly engaged with this business. The plastic industry falls in
cottage industry and there are some manufacturers, who are medium-sized industries.

Consumption & Imports


Pakistan imports 80-90 percent raw material for plastic making from different countries.
The total consumption of raw material used in the plastic industry in the country is
around 450,000 tonnes. The country imports 70 percent raw material from UAE and Far
Eastern countries. The special grade raw material is imported from Germany and USA,
which is 20 percent of total raw material consumption. India is also a major producer of
plastics raw material. The total consumption of plastic raw material in India is two million
tones annually.
The prices of raw material of plastic industry depend on international scenario. During
Iraq war, the prices shot up by 70 percent. The raw material of plastic industry is a by-

SMEDA_UNIDO Cluster Development Programme Pakistan

10

Diagnostic Study on Plastic Products, Lahore

product of crude oil. The prices are directly related to crude oil prices as the raw
material is made from Naphtha, which is a by-product of crude oil.
Moreover, the recent penetration of cheap Chinese products into Pakistan has made
the competitive situation in the local plastic industry very intense. Local manufacturers
have to import raw material which is a substantive cost of their total produce while
Chinese products offering a large variety at affordable rates have made survival difficult
for the local industry.

BENCHMARKED CLUSTER
China has the seventh-largest economy in the world in terms of gross domestic product
(GDP). With more than 1.3 billion people, China also has the world's largest consumer
market. The plastics processing industry has been developing at an average annual
rate of 10% since 1997 in response to massive developments in the Chinese building
and construction, automotive, packaging and agriculture sectors. The evolution of the
use of plastic products in these sectors is forcing plastic processors to upgrade and
replace current infrastructures with high-tech, high-precision, plastic production
machinery and moulds that can develop new products with higher added value.
Chinas domestic output of synthetic resins can only satisfy 40% of market demand.
This supply imbalance continued during the 2002-2005 period, requiring China to rely
heavily on imports to fill its shortfall of resins. Rapid growth in the construction and
packaging sectors in China are driving demand for commodity synthetic resins like
polyvinyl chloride, polyethylene and polystyrene. Engineering plastics are expected to
have good market prospects for exporters as a result of the expansion of major
consumers such as the automotive and telecommunications industries.
According to the China Plastic Processing Industrial Association (CPPIA), the plastic
processing industry will experience rapid development from 2001 to 2005. An increase
in demand for plastic products from downstream manufacturing industries, such as
construction, automotive, packaging and agriculture, will account for the industrys rapid
growth.
Chinas per-capita consumption of plastics is relatively low, despite its position as a
major producer. The annual consumption of plastics per capita in China is only 10
kilograms (kg), while the world average is 45-55 kg in developed countries. Germany is
one of the highest per-capita consumers at 120 kg, while per-capita usage in Canada
and the United States is about 80 kg.
The China Plastics Processing Industry Association replaced state control over the
plastics processing industry. The Association consists of over 700 member companies
nation-wide that produce plastic films, plates, sheets, pipes, rods and other plastic
products.

SMEDA_UNIDO Cluster Development Programme Pakistan

11

Diagnostic Study on Plastic Products, Lahore

China is relatively self-sufficient in producing and supplying low-grade plastic products


and medium-grade products to the domestic industries. However, the level of
technology and equipment for the production of high-quality goods in China is quite low.
To date, advanced equipment accounts for only 25% of the total machinery in use in
China. The majority of plastic processors are middle- to small-scale factories lacking the
sophisticated processing technology to develop high-grade plastic products.
In China, plastics are progressively being used as a substitute to steel, wood and
traditional building material. According to the CPPIA, material trends are favoring the
use of plastics in municipal projects, rural projects and industrial construction. Chinese
consumers believe that the benefits of using plastics include energy saving, ecological
protection and improvement of living standard
Key Factors Shaping Market Growth
Self-sufficiency in producing and supplying low-grade plastic products and
medium-grade products to the domestic industries.
Chinese government provides national treatment to all foreign companies
Tariffs for many resins have been considerably reduced in recent years.
Product standards and standard-related procedures will be improved and brought
in line with international practice.
Very Strong and Large Association (CPPIA) replaced state control over
processing units.

SMEDA_UNIDO Cluster Development Programme Pakistan

12

Diagnostic Study on Plastic Products, Lahore

PLASTIC INDUSTRY IN LAHORE REGION


Plastics industry in Pakistan is one of the oldest in the country and its existence can be
traced out even in the year 1947 when Pakistan came into being. Obviously, at that
time, the industry was ill-organized and progressed in a haphazard manner producing
low quality toys and household utensils on hand molding machines. Whatever the
quantity of those machines was, they were small in number and all set in Lahore, an
important commercial centre of Punjab till date. The period from 1965-1975 was notably
the turning point, where the use of plastics was seen rising to a leading force in the
country, with a sizeable base
About 60% of the plastic industry is located in and around Lahore region. The scarcity of
available industry data restricts the analysis of current position in Lahore to some
extent.

ANALYSIS OF BUSINESS OPERATIONS


Business Status
Almost all of enterprises are working as sole proprietorship but in recent times some
have advanced to more organized status and converted their enterprises to Pvt. Ltd.
companies.
Social & Regulatory environment
As far as domestic laws of the country are concerned, firms dont face much difficulty
in complying with them. But at the international scenario, new rules and regulations
keep on coming every now and then. Very few examples of a firm being ISO certified
can be seen in the cluster and those also engaged in export or a medium/large unit.
Finance
All of the businesses are being mostly finance by equity. No banking institute has yet
recognized the potential of the cluster and hasnt come up with any type of scheme
for the enterprises. But those who have obtained financing for either machinery or
working capital needs have been enjoying good pay-back history with banks.
Human Resource
Upper Management tasks are performed mostly by the owners of the companies,
who in most cases are not appropriately educated and trained because of limited
vision and local supply. Other hierarchy levels are very limited. Production floor labor
is easily available in the market.
Raw material Procurement
Raw material is purchased locally, from Karachi and imported from abroad. Medium
to large manufacturers do have the capacity to purchase in advance and in bulk
quantity making them in an advantageous position to produce at a lesser cost. Local

SMEDA_UNIDO Cluster Development Programme Pakistan

13

Diagnostic Study on Plastic Products, Lahore

suppliers of raw material are keep stock of different types according to seasonal
requirements.
Product Sale
Enterprises located in this region are selling their products directly to the local
markets and one recent example of a Factory-owned Retail shop has been started
for direct selling to the customers. Almost 70% of the products are consumed within
the same region. Export figures for this region cannot be measured as estimates do
vary significantly. Businesses engaged in international trade have separate sales
and marketing department looking after the international sales. Some major firms do
participate in International exhibition for buyer-seller meet but small and medium
firms cant afford and hence seldom participate in Intl fairs and exhibition.

SMEDA_UNIDO Cluster Development Programme Pakistan

14

Diagnostic Study on Plastic Products, Lahore

PROCESS FLOW
There are several different processing methods used to make plastic products.
Below are the main methods in which plastics are processed to form the products
that end consumers use,.
No.

Molding process

Product

Extrusion molding

Injection molding

3
4
5
6

Blow molding
Vacuum forming
Pressure forming
Rotation molding

Pipe, fiber , film, sheet and thermoforming,


profile, pipe, wire & cable etc.
Bucket, housing of office automation
equipment
Container, bottle
Packcase for egg (thin film product)
Suitcase (thick sheet product)
Bottle, doll

Extrusion Molding -- the main process used to form plastics. A heated plastic
compound is forced continuously through a forming die made in the desired shape (like
squeezing toothpaste from a tube, it produces a long, usually narrow, continuous
product). The formed plastic cools under blown air or in a water bath and hardens on a
moving belt. Rods, tubes, pipes and sheet and thin film (such as food wraps) are
extruded then coiled or cut to desired lengths.
Plastic fibers also are made by an extrusion process. Liquid resin is squeezed through
thousands of tiny holes called spinnerets to produce the fine threads from which plastic
fabrics are woven.
Injection Molding -- is the second most widely used process to form plastics. The
plastic compound, heated to a semi fluid state, is squirted into a mold under great
pressure and hardens quickly. The mold then opens and the part is released. This
process can be repeated as many times as necessary and is particularly suited to mass
production methods. Injection molding is used for a wide variety of plastic products,
from small cups and toys to large objects weighing 30 pounds or more.
Blow Molding -- pressure is used to form hollow objects, such as the soda pop bottle or
two-gallon milk bottle, in a direct or indirect method. In the direct blow-molding method,
a partially shaped, heated plastic form is inserted into a mold. Air is blown into the form,
forcing it to expand to the shape of the mold. In the indirect method, a plastic sheet or
special shape is heated then clamped between a die and a cover. Air is forced between
the plastic and the cover and presses the material into the shape of the die.

SMEDA_UNIDO Cluster Development Programme Pakistan

15

Diagnostic Study on Plastic Products, Lahore

SMEDA_UNIDO Cluster Development Programme Pakistan

16

Diagnostic Study on Plastic Products, Lahore

CORE CLUSTER ACTORS


1- Manufacturers
There are 700 800 manufacturers of plastic products in Lahore of which 3% are
relatively bigger in size (over 50 employees). 400 organized units are either affiliated with
Lahore Chamber or PPMA (Pakistan Plastic manufacturers Association). The industry is
occupied with 55% unorganized manufacturers. Some of the prominent manufacturers
have longer supply contracts from major customers. Some companies have also started
to export in recent years. The Bottle and Container manufacturers are around 50-60 in
Lahore Cluster.
The types of products that are produced are as follows:
Plastic Raw Material
PET bottles, Jars, Cups
Molded Furniture
Buckets, Mugs, Storage Bins & similar products
HDPE Sacks & Woven Sacks
Commode covers, Flushing mechanisms,
Household Kitchenware
Water Filter
Automotive parts
Electronics parts
Plastic Sheet
Forged, Machined & Heat Treated parts,
Crockery items (Forks, Crankshafts)
Telecommunication Parts
Fan parts
Medical Instruments (Syringes. etc.)
Stationary Items (ball pen, fiber tip pens, etc.)
Plastic Processing machinery & equipment.
Resin & Allied Products.
Pipes and fittings
Plastic Films
Waste Processed Products
Misc.
Recycling/ scrap of plastic:
Plastic scrap recycling has developed into an industry in Pakistan. About 400 units are
engaged in recycling of plastic scrap in Punjab.
The sources for collection of scrap are house hold waste of broken unusable plastic
items, Industrial plastic waste, plastic cans, container, etc., hospital waste such as
disposables syringes, canolas, etc.

SMEDA_UNIDO Cluster Development Programme Pakistan

17

Diagnostic Study on Plastic Products, Lahore

The recycled material is used for manufacture of low cost and inferior quality products
such as, house holds utensils, Sandals / Chappals, Washers and seals for water supply
fittings, some units mix the re-cycled material with pure material to reduce their cost of
production, and some other plastic goods.
2- Raw Material & Chemical Suppliers
GE Plastics is a leading supplier of Engineering Plastics, Silicones, Specialty Chemicals
and Sheets. It has 66% and 33% of total market share of Pakistan for engineering
Plastics and Silicones market respectively.
Raw material production in Pakistan is extremely low and does not meet the required
demand. Almost all plastics raw material consumed in Pakistan is being imported. In
neighboring India, Raw material producers are not only catering to the local industry, but
also exporting the surplus. Engro Asahi Chemicals Pakistan, who took the lead and set
up a PVC Plant in Karachi- the first of its kind in Pakistan. It was a joint venture with
Japanese companies that took the initiative and established this mega project in the
country. Similarly 3 more plants producing PET, High Impact Polystyrene, Melamine
Formaldehyde and Expandable Polystyrene were also set in Karachi.
No statistics are available on the exact consumption of plastics raw materials in the
country, but a modest estimation indicates that more than 1.5 million M/T of different
plastics are required every year. This local production barely meets 30% of the
estimated demand, leaving a shortfall of more one million M/T. This gives room for
imports and constitutes a burden on the national economy.
3- Machinery Suppliers
Plastic processing machinery is mostly imported from Japan, Korea, China and
Germany. However, locally manufactured machinery is also being used. A list of major
suppliers of imported plastic processing machinery is given in the table below:

Asian Plastic Machinery Co. Limited, Karachi


Nissai ASB Pvt. Limited, supplier of Japanese Blow Molding Machines.
Hongkong CAD-CAM Services Limited, Karachi
Plastipack Machine (Pvt) Limited, Karachi
Jakkey Traders, Karachi

4- Mold & Die Makers


Other than plastic products or components makers, there are also some Mold & Die
makers, contributing to the local demands of plastic processing industry. Approx
numbers of players in this field are around 70.
5- Traders, Wholesalers Distributors

SMEDA_UNIDO Cluster Development Programme Pakistan

18

Diagnostic Study on Plastic Products, Lahore

These are the largest units in terms of number present in the Lahore plastic products
cluster and are located in almost all major industrial location ( Shal Alam Market, Bund
Road, Circular Road, Kot-Lakh Pat, Gulberg, etc.) They purchase the products directly
from factories and distribute locally. Some Manufacturing units also have their own
distribution system and they have established their own retail stores as well. Their main
problems identified were that of infrastructure. The local markets have their own trade
bodies and they work to protect their own market interests. These Trade bodies are not
recognized anywhere in the Government agencies.
5- Component Industries
As discussed earlier, the plastics are used in many a component industries e.g.
Automotive Industry, Electrical, Packaging and Construction. These industries itself
represent their own clusters and have their own association for highlighting the
problems.

INTEREST GROUPS
Pakistan Plastic Manufacturers Association
The PPMA was established to safeguard the interests of Plastic Manufacturers in
Pakistan in 1980s. The main objectives were to protect, promote, encourage and
develop plastic processing industry in Pakistan and raise the production standards of its
member enterprises.
The association has a zonal office located in an industrial zone (Kot Lakhpat) and
operates from the premises of a manufacturer. The zonal association doesnt have any
paid staff. The elections are held almost every year to elect five Executive committee
members, which then nominates the President and Vice President for a year. The
association charges Rs. 1000 for a year as membership fee and that is the sole fund
raising point. Currently Association is looking forward to selecting a separate place for
its zonal office in Lahore and then a full time Secretary and other support staff will also
be recruited.
The Association often holds certain seminars, trainings and Annual Exhibitions. They
exchange budget proposals with local Chamber of Commerce. Financial institutions
also dont have any interaction with association. The association representatives are
linked with a BDS provider (SMEDA) and often meetings are held for the purpose of
sharing information. Technical Experts from International countries like Japan who visit
SMEDA does have interactions with association representatives as well.
2- Lahore Chamber Of Commerce & Industry
Lahore Chamber is a premium institution providing different kinds of services to its
regions members. These activities range from providing membership of the institution
to holding different International Exhibitions. The LCCI Membership department serves
SMEDA_UNIDO Cluster Development Programme Pakistan

19

Diagnostic Study on Plastic Products, Lahore

as a gateway to the Chamber. As soon as membership is obtained members are


eligible to avail several valuable services of the Chamber. Membership Record,
Membership Card, Certificate of Origin, Issuance of Visa Recommendation letters,
Issuance of Foreign Exchange Letter, Compilation of classified directory and Members
List, Issuance of Status and Reference Reports, Attestation of Commercial Documents.)
Other services by Chamber include

Information Dissemination, Research & Development, Fortnightly Newsletter,


Internet facilities, Business Center ( Emails, Faxes, Phones), Cell for
Rehabilitation of Special people , Comprehensive Library, Visitor Gallery ,
Women Entrepreneurs help.

Standing committee on Petro-Chemicals & Plastic meet once in a month to


discuss issues and problems of the sector and then formulate proposals to be
sent to the government or raised through the chamber platform. The committee
consists of units registered with chamber.

SUPPORT SERVICE INSTITUTION

Financial Institutes
Commercial banks and specialized Financial Institutes (SME Bank, PICIC, etc.) are
individually linked to the industry. Banks have not been associated with any cluster
stakeholder for any activity other than providing financial services. The demand of the
cluster has been on the increase for expansion and the finances are mostly required for
working capital needs, longer term supply contracts and machinery leasing. The Loan
Repayment history of the cluster on the whole has been remarked as excellent.
TECHNICAL INSTITUTES
1- Pakistan Standards & Quality Control Authority
The development of Metrology, Standards, Testing and Quality (MSTQ) infrastructure
provides an essential building for industrial development in a country. Feeling this need,
government of Pakistan established Pakistan Standards and Quality Control Authority
(PSQCA) in 2000.
The three organizations namely, Pakistan Standards Institution (now SDC), Central
Testing Laboratories (now QCC) and Metal Industries Research and Development
centre (now TSC) have already been merged in PSQCA to provide one window
standardization, quality control and other technical services
Main Activities of PSQCA:
Establishment of National Standards.

SMEDA_UNIDO Cluster Development Programme Pakistan

20

Diagnostic Study on Plastic Products, Lahore

Enforcement of National Standards under compulsory/voluntary Certification


Marks Scheme.
Registration of Inspection Agencies.
Testing and assessment of industrial raw materials and finished products to
establish their quality, grade and composition with reference to national or
international specifications in the fields like textile, chemical and mechanical
engineering, electrical and electronic goods and appliances, and building
materials etc.`
Assistance to metal industry in product improvement, technological advancement
and increased productivity.
Promotion of development of metallurgical techniques and kills in the country
through the transfer of technology and expertise in the metallurgical fields.
Research and Development (R&D) work on standardization, on analytical/testing
techniques in chemical and other fields and on metallurgical techniques.
Dissemination of technical information about standardization, quality control and
metrology through seminars, workshops, symposia, press, print and electronic media to
increase awareness about quality and to create a quality conscious culture in the
country.
2- Technical Education & Vocational Training Authority
The Technical Education and Vocational Training Authority is a significant endeavor of
the Government of Punjab, which focuses on the development of human resource in
terms of skill up gradation for men and women. They also acquire skills whereby they
can also set up their own small industrial or service establishments. The technical
institutes, commerce institutes & colleges and vocational institutes are established by
TEVTA in every city.
The importance of technical education compared to general education is easily
understandable because there is an immediate value addition and even a matriculate
with a technical diploma is immediately employed by the industry. TEVTA has also
ensured liaison with industry at all levels in terms of the technical training as well
ensuring relevant curriculum to suit industrial needs. It is the only authority in Pakistan,
which is focusing on skill development and improving employability levels.
International Collaborations for providing training in specific fields are am important part
of TEVTA activities. The whole emphasis is on improving the quality so as to ensure
larger employment opportunities for the girls and boys who are trained by TEVTA. This
is a strong tool for reducing poverty.
Presently TEVTA and plastic Industry are not properly associated and the courses
offered by the institute are outdated and requires updating the curriculum.
3- Plastic Injection Mold Technology Development Project

SMEDA_UNIDO Cluster Development Programme Pakistan

21

Diagnostic Study on Plastic Products, Lahore

Government of Japan and Government of Pakistan joined hands to support Local


Plastic industry and started this project. The Center has been located as PITAC
premises, centrally located in Lahore. In the first phase the staff members were trained
by Japanese experts in the injection molding technology and in the second phase the
market demands were collected to formulate the services of the center. Three kinds of
services are planned to be provided to the Plastic Products Industry;
1. Training Courses & Seminars
2. Backup Support Services
3. Advisory services
In the coming years this center will be highly productive and helpful with the available
resources. This center received a lot of demand for technical trainings and mold
designing from the Lahore plastic products manufacturers. The activities will be on the
increase in the coming years.
BDS PROVIDERS
1-Engineering Development Board
EDB is a Government Organization for promotion of Engineering Industry in
Pakistan with following Terms of Reference:1- Develop a long term vision for the development of the Engineering sector.
2- Formulate and co ordinate Government policies relating to the Engineering
sector.
3- Develop an overall strategic Engineering development plan.
4- Promotion of export.
5- Enhancement of technical training.
6- Formulate policies and guidelines for utilization of technical development and
Engineering funds.
7- Appeal for grievances.
8- Management of deletion policy.
At present Industry is not yet clear of their activities and proper linkages are not present.
2- Small & Medium Enterprise Development Authority
This Federal Level Agency was created to take on the challenge of developing SMEs in
Pakistan. SMEDA is working as the provider and facilitator of support services to SMEs.
It is key resource base for SMEs and it also acts as the voice of SMEs
SMEDA Ordinance clearly specifies its main objectives:

The creation of a conducive and enabling regulatory environment;

Development of industrial clusters;

SMEDA_UNIDO Cluster Development Programme Pakistan

22

Diagnostic Study on Plastic Products, Lahore

And the provision of Business Development Services to SMEs in all areas of


business management.

SMEDA started Sectoral approach for Plastics sectors some two years back and
consultations with association and stakeholders were held. Due to lack of interest by
Stakeholders/Association, nothing happened and work was halted. Various Seminars
have been conducted for the Plastic industry in Lahore and participation from the
industry has been excellent. Demands for more market driven trainings was placed by
the participants.
3- Export Promotion Bureau:
EPB is also a Government institution that has a mandate to promote products with
MADE IN PAKSITAN label. There are various kinds of services like organizing
international Exhibitions, arranging international delegations, Seminars, Export
subsidies, developing export markets, providing support services to local industry
capable of earning foreign exchange. The Vision of EPB is stated below;
Providing Leadership, Direction, Pro and Re-active Facilitation, to an aggressive
national drive for maximization of sustainable growth of Pakistan's Foreign Trade
As this cluster has just started to do exports, demand for International Trainings,
Exhibitions are on the rise and industry is in demand of new technology to compete in
the international market.
4- Large Enterprises:
Some of the Large Industrial organizations in the cluster also provide business
consultancy and support services (technical & Mechanical) for the small cluster
members.
5- Environment Protection Agency:
The Environmental Protection Agency Punjab functions under the provisions of Pakistan
Environmental Protection Act, 1997. Its main functions and duties are to promote
environment friendly policies and programmes. EPA existence in the cluster is hardly
noticeable.
6- Lahore Development Authority
The LDA is divided into three main Wings for the performance of its functions.
Infrastructural facilities are the responsibility of this organization for the city.

SMEDA_UNIDO Cluster Development Programme Pakistan

23

Diagnostic Study on Plastic Products, Lahore

1. Urban Development wing is responsible for the planning, designing and


development of various projects in accordance with the functions of the
Development Authority.
2. Water and Sanitation Agency was created as subsidiary Agency of Lahore
Development Authority for the Planning, Designing, Development, Maintenance,
Water Supply, Sewerage and Drainage System in Lahore.
3. Traffic Engineering Planning Agency was created as subsidiary agency for the
Planning, Designing and Development of Traffic and Transport System Roads &
Projects in Lahore.
7- Punjab Small Industries Corporation
Punjab Small Industries Corporation (PSIC) was established in July 1972 under PSIC
Act to promote sustained development through provision of market driven credit,
infrastructure and technological support, contributing to employment generation, poverty
alleviation and socio-economic uplift of the province. The main functions of the agency
are;

Advisory services & consultancy


Establishment of infrastructure for Small Industries
Skilled Manpower Development
Establishment of service centers to provide advisory services and common
facilities.
Handicrafts Development Credit assistance for the establishment of new
industries
Development of small industrial estates for new industries
Development of small industrial estates with complete infrastructure and credit
facilities

9- Export Processing Zones:

Pakistans export processing zones have much to offer to investors and are making a
positive contribution to the countrys economy. The Export Processing Zones Authority
of Pakistan (EPZA) has contributed significantly in the governments drive to attract
foreign direct investment by offering a state-of-the-art package of incentives and
facilities. During the last three years, the success of export processing zones (EPZs) in
Pakistan has generated new faith in business circles, demonstrated by the inflow of the
large number of investment proposals being received by EPZA.
In Lahore, recently a SUNDER INDUSTRIAL ESTATE was established last year, for
which the EPZA received overwhelming response from the industry and all plots were
allocated to potential Businessmen to establish Industries. People from Plastic Industry
also showed interest in that and obtained certain space for their relocation or new
setups.

SMEDA_UNIDO Cluster Development Programme Pakistan

24

Diagnostic Study on Plastic Products, Lahore

SWOT ANALYSIS
Strengths

Opportunities

Easy availability of cheap labor


Increasing domestic market having
demands from both low-end and
high-end segments.
Several Large Units are also present.
Industrial Zones facilities are
available.
Location is a competitive strength.
Acceptable as international Avenue
for Exhibitions / Seminar / Foreign
Buyers visit
Sound Cash flows

Weaknesses

The industry is largely unorganized


and scattered.
Professional management is not
perceptible in the cluster.
The manufacturers are dependent on
imported raw material from outside.
Lack of Research & Development
efforts
Lack of vision / Planning.
Traditional designs and no
innovations.
Not getting benefits from support
institutions.
Nominal Export.
Weak Association.

Pakistan is emerging as a major


consumer market and international
demand is also on the rise for plastics.
Globalization and free trade.
Strong National Economic indicators
working for benefit of Industry.
Linkages with BDS & Support service
providers
Product Marketing
New and innovative products.

Threats

SMEDA_UNIDO Cluster Development Programme Pakistan

Globalization and free trade.


High custom duties on Raw Material
Local Market Penetration by regional
competitors.
High Quality Standards.

25

Diagnostic Study on Plastic Products, Lahore

CLUSTER MAP

Large Firms
Technical
Support

PITAC
JICA

Financial
Institutes

NPO

TEVTA
Chemical
Suppliers

Wholesalers
Traders

Plastic Products
Manufacturers

Distributors
End
Consumers

Component
Industries

PPMA

Raw material
Suppliers
Machinery
Suppliers
Mold & Dies
makers

Direct Export

EDB

EPA &
EPZ

PSQCA

LCCI

SMEDA_UNIDO Cluster Development Programme Pakistan

LDA

UNIDO

EPB

SMEDA

26

Educational
Institutes

Diagnostic Study on Plastic Products, Lahore

CURRENT INSTITUTIONAL MATRIX

PPMA LCCI EDB EPB SMEDA FIs PSQCA PITAC LDA EDU NPO EPA/EPZ LF UNIDO
PPMA

LCCI

EDB

EPB

SMEDA

FIs

PSQCA

PITAC

X
X
X
4

X
X
X
X

LDA

EDU

NPO

EPA/EPZ

LF

UNIDO

X
Not Applicable

Know but never interacted

Formal Relationship

Not Explored

**

Just interacted

Enthusiasm

Negative

-1

Formal Correspondence

Dont Know each other

Few Joint Projects

SMEDA_UNIDO Cluster Development Programme Pakistan

27

Diagnostic Study on Plastic Products, Lahore

VISION
To Create Strong Linkages Among Cluster Actors And Improve Production Standards
And Productivity To Compete With International Quality Benchmarks. Increase Exports
Of Cluster To US $ 100 Million In Five Years By Focusing On New Geographic Markets
And Marketing / Distribution Channels.

ACTION PLAN (THEME WISE)


1-Sensitization:
No.
Action / Activities

Agency/Institution

Finish Date

SMEDA / UNIDO / PPMA / LCCI

July 2006

2 Awareness
Workshops

2-Capacity Building of Cluster


No.
Action / Activities
Agency/Institution

Finish Date

Training need
assessment of cluster
3 Mold Designing and
Process Training
courses
Plastic Export Potential
(Workshop)

SMEDA

Mar 2006

PITAC / PPMA / UNIDO / LCCI /


SMEDA

Dec 2006

SMEDA / UNIDO / PPMA / LCCI

Dec 2006

Strengthening of
Association

PPMA / UNIDO / SMEDA / BDS

Dec 2006

Establishment of
Plastic Website

PPMA/SMEDA

Dec 2006

2
3

3-Creation of Strong Linkages / Networking


No.
Action / Activities
Agency/Institution

Finish Date

Creation of 2 networks

SMEDA

Aug 2006

Joint activities of
networks (catalogues,
brochures)
Hiring marketing BDS
by networks

SMEDA / Networks

Dec 2006

Networks. UNIDO / EPB /


SMEDA / BDS

Mar 2007

Participation in Int'l
Trade Fair by 2
networks

PPMA / LCCI / SMEDA / EPB

July 2007

Appointments of NDAs in
mature networks

Networks / UNIDO

Dec 2007

SMEDA_UNIDO Cluster Development Programme Pakistan

28

Diagnostic Study on Plastic Products, Lahore

Annexure

SMEDA_UNIDO Cluster Development Programme Pakistan

29

Diagnostic Study on Plastic Products, Lahore

Annexure 1
10 FACTS ABOUT PLASTICS EVERYONE SHOULD KNOW
1. Plastics are one of the most resource efficient and versatile materials available to
society.
2. Plastics make a significant contribution to the vital goals of sustainable
development:
Social progress: plastics provide affordable products giving more people
access to higher standards of living, healthcare and information.
Economic development: the plastics industry chain in Europe adds value to
society. It employs well over 1.5 million people and generates sales in excess of
159 billion euro.
Environment protection: plastics help save resources fossil fuels and energy.
Plastics products save water and food.
3. Plastics consume only a tiny fraction just 4 % of the worlds oil, as feedstock.
4. Plastics products in use save oil:
100 kg of plastics parts in cars reduces oil consumption by about 12 million tones each
year in Europe, reducing CO2 emissions by 30 million tones a year.
Plastics help reduce fuel consumption and CO2 emissions from our homes: the
innovative use of plastics can reduce domestic fuel consumption to 3 liters per square
meter, compared to an average of 20 liters.
5. Plastics are too valuable to waste even at end-of-life. After serving a useful
purpose, plastics can either be recycled or used as an alternative fuel. Plastic waste has
a calorific value at least equal to coal and with lower CO2 emissions.
6. Renewable energies rely on plastics: solar panels, wind turbines.
7. Over 1 billion people in the world lack access to safe water. Plastics can preserve
and distribute water economically, reliably and safely.
8. No other material can compete with plastics when it comes to meeting technological
demands while preserving resources.
9. Plastics are the champions of prevention: Plastics packaging represents 17 % all
European packaging and yet packages over 50% of the consumer goods.
Over a ten-year period it is estimated that plastics packaging per unit has been
reduced by around 28% thanks to technology
Without plastics packaging, the weight of packaging would increase four-fold,
production costs and energy consumption would be doubled and waste volume
increased by 150%

SMEDA_UNIDO Cluster Development Programme Pakistan

30

Diagnostic Study on Plastic Products, Lahore

10. Plastics make our lives safer: airbags, seatbelts, baby seats, bike helmets, medical
devices are just some examples.

Annexure 2
BOTTLE / CONTAINER MANUFACTURING PROCESS STEP BY STEP
Creation of the Preform
A preform is the first stage of bottle production and is the result of the
Injection Moulding process. Each preform is shaped like a test tube with the
upper end in the shape of the bottle mouth (the finish). This preform is thick,
round and comes in many sizes depending on the required final bottle size.
1
A vacuum draws mixed virgin and reformed pellets into the drier.
The resin is dried to below a moisture content of 50ppm
(particulates per million).
Step 2
After several hours, the blended resin is injected into the
preform mould and clamped, resulting in the production of the
embryonic bottle.

Blowing the Bottle


The next and final manufacturing stage is called Blow Molding. The blow molding
machine creates the final shape of the bottle.
Step 3
The preform is heated by heater boxes with several variable
lamps. The settings of these lamps are called the profile.
Step 4

The preform is transported into the mould. A hot preform is clamped in a


blow
Step 5

SMEDA_UNIDO Cluster Development Programme Pakistan

31

Diagnostic Study on Plastic Products, Lahore

A stretch rod enters the preform and stretches it lengthwise.


Step 6

Low pressure air is blown into the preform to form the main part of the
bottle.
Step 7

High pressure air is blown into the bottle to fill out the details like the feet
and any markings (e.g. logos)
Step 8

The air is allowed to escape from the bottle and this time in contact with
the chilled mould allows the bottle to crystallize. Time is allotted in the
cycle to depressurize the mould before opening it and removing the bottle.

SMEDA_UNIDO Cluster Development Programme Pakistan

32

Anda mungkin juga menyukai