Role of Trade and Industry

In Economic Development of
Pakistan.

Presented by
Afshan Jamil (BBC-08-03)
Ammar Hassan (BBC-08-15)

Types of Economies

Raw Material Exporting Economy.

( Saudi Arabia Oil)
Subsistence Economy. ( Few
opportunities)
Industrializing Economy. ( Developing
Countries)
Industrial Economy. ( Developed
Countries)

Innovation Phases

The factors of production, usually summarized in the

categories of labor, capital and nature in economic
theory constitute the productive resources of the country.

First Wave
1785-1845 60 Years Water
Power; Textiles; Iron
Second Wave
1845-1900 55 Years Steam
Rail, Steel.
Third Wave
1900-1950
50 years
Electricity, Chemicals, Internal-combustion Engine
Fourth Wave 1950-1990
40 Years
Petrochemicals, Electronics, Aviation.
Fifth Wave 1990-2020
30 years Digital
Networks, Software, New Media.

INDUSTRIAL SECTOR

Pakistan rank 41st in

the world and 55th
worldwide in the
factory output.
Industries contribute
24% of the GDP.
Industrial production
growth rate 6%.

Major Industries in
Pakistan
Textile
Fertilizer
Cement
Oil

refineries
Beverages
Clothing
Food processing

Types of Industries In
Pakistan

Large Scale Manufacturing

Industries.
Small Scale Manufacturing Industries.

Large Scale Manufacturing

Industries

67.1% of total manufacturing sector.

17.1% growth rate.
18% contribution to GDP.

Major Large Scale

Manufacturing Industries In
Pakistan

Fertilizer Industry

11 industries total
6 in Punjab
3 in Sindh
2 in N.W.F.P
Producing Nitrogenous & Phosphatic
fertilizers.

Textile Industry

8.5% contribution to GDP.

Covers 46% of total Industrial Sector.
Providing Hosiery, Cloth, Ready-Made
garments.
3% of United States imports regarding
clothing and other form of textiles are
covered by Pakistan.
Textile exports share in total export of
Pakistan has declined from 67% in 1997 to
55% in 2008

Vegetable & Ghee Industry

Major share by Private Sector.

155 units.

Sugar Industry

77 Large Sugar Plants.

The productivity is very much inefficient ( 2003-04 a decline from 5.5
to4 million tons production)
38 sugar plants in Punjab.
32 in Sindh.
6 in NWFP
1 in Azad Jammu and Kashmir

Cement Industry

27 large Cement Plants.

Productive Capacity of 17.6 million tons.
An increase in demand from 7.7 million
tons to 9.8 million tons during the last
6-7 years.
Mainly due to increase constructional
expenditures, decrease in public sector
development.

Automobile Industry

The total contribution of Auto industry

to GDP in 2008 is 2.8% which is likely to
increase up to 5.6% in the next 5 years.
18 units working in country.
Major increase due to the rise in
demand of cars in the country probably
due to leasing & car financing.

Paints and Varnish Industry

22 units in organized sector and 400 units in

unorganized sector.
By organized sector it means that sector whose
records are available and includes firms
organized as companies, payments made via
the banking system, incomes reported to the
tax authorities, sales reported to the VAT
authorities, and employment reported to the
National Insurance authorities.
Due to revival of housing sector a 50% demand
is met by organized and 50% by unorganized.

CNG Industry

Pakistan is one of the largest users of

CNG (compressed natural gas) in the
world.
More than 2,900 CNG stations are
operating in the country in 85 cities
and towns.

IT Industry

Total number of IT companies

increased to 1306 and the total
estimated size of IT industry is $2.8
billion.
2007, Pakistan was for the first time
featured in the Global Services
Location Index by A.T. Kearney.

Communication Industry

Pakistan Telecommunication Company Ltd has

emerged as a successful Forbes 2000
conglomerate with over US $1 billion in sales in
2005.
Mobile telephone market has exploded
fourteen-fold since 2000 to reach a subscriber
base of 91 million users in 2008.
Contribution of telecom sector to the national
exchequer increased to Rs 110 billion in the
year 2007-08 on account of general sales tax,
activation charges and other steps as compared
to Rs 100 billion in the year 2006-07.

Problems of Large Scale

Manufacturing Industries

Provided consumers with lower quality

and higher prices.
All industrialization was capital intensive
& employment could not increase.
Industrialists earned abnormal profits and
wasted them despite of re-ploughing
them.
Textile sector could not modernize itself.
More political influence on industries.

Small Scale Manufacturing

Industries

75% share in economy.

Provides Jobs to unskilled labor.
80% labor force employed from the
rural sector.
Includes carpet making, cloth,
washing, shoe etc.
6.5% of GDP

Importance of Small Scale

Manufacturing Sector.

Employment to Women.
Increase in Exports.
Increase in GDP.
Ease of establishment.
Provide experience and skills.

Problems/Drawbacks

Shortage of finance.
High production cost.
Lack of standardization.
Lack of marketing facilities.
Irregular supply of raw material.

Automobile Industry

Total contribution
of Auto industry to
GDP in 2007 is
2.8% which is likely
to increase up to
5.6% in the next
five years.

Cement Industry

In 1947, Pakistan had four cement

plant with a total capacity of 0.5
million tons.
Now the cement sector comprising of
27 plants is contributing above Rs.
30 billion to the national exchequer
in the form of taxes.

IT Industry

The total number of IT companies

increased to 1306 and the total
estimated size of IT industry is $2.8
billion.
Pakistan was for the first time
featured in the Global Services
Location Index and was rated as 20th.

Textiles

Textile industry is dominated by

Punjab.
Textile exports are managed to
increased a very decent growth of
16% in 2006.

Services

Pakistans service
sector accounts for
about 53.3% of GDP.
Transport, storage,
communication,
finance and insurance
account for 24% of
this sector.
Wholesale and retail
trade account for 30%.

Agro-Processing industry

This industry refers to

subset of manufacturing
that processes raw
material and
intermediate products
derived from agricultural
sector.
The role of agro
processing industry as a
sector of economy has
multiple facets and in
the course of
development.

Agro-Processing Industry

Upstream industries- initial

processing
Downstream industries- further
manufacturing operations on
intermediate products.

TRADE

Trade has contributed

much more to the
development of the
world economies than
any other factor.
It is because different
nations interact with
each other through trade
that it tends to bring
about the desired change
through the exchange of
goods, services, skills,
knowledge and
expertise.

Foreign trade

Pakistan is a
member of WTO
(world trade
organization) and
has bilateral and
multilateral trade
agreements with
many nations and
international
organizations.

According to World Trade and

Development report 2002 defines the
market dynamism of the products as
the high average annual export value
growth.

Exports

Pakistans exports
increased more
than 100% from
$7.5 billion in 1999
to stand at $18
billion in the
financial year
2007-2008.

Imports

Pakistans imports stood at $30.54

billion in the financial year 20062007, up by 8.22% from last years
imports of $28.58 billion.

Important Facts About Our

Country

Highest Railway Station of Asia.

Gawadar is world`s largest sea port.
Khewra is the world`s 2nd largest salt mine.
Tarbela Dam 2nd largest dam in the world and the
largest earth filled dam in the world.
5th largest gold mine and largest coal reserves are in
Pakistan.
Most connected country in South Asia with largest Teledentistry.
Largest 6th gas reserve of Asia is in Pakistan.
POF EYE new corner is the world`s best Gun
Technology made in Pakistan.