The business community has come up with differing opinions in relation to the expected grant of most-favoured nation (MFN) status to India.
There are wide differences among them as some who see benefits in it are supporting the move while some others are feeling threatened due to possibility of losing customers to more competitive Indian producers.
Textile industrialists and exporters, who were anxiously waiting for government’s decision to allow free trade with India, expressed the hope that it would win a large market for them and help earn huge revenues.
At present, many products for the textile industry are coming from India via Dubai, of which dyes and chemicals are the most important. Direct import of raw material and machinery from India would reduce cost and save time for domestic industries, they said, adding after the grant of MFN status to India, imports would get cheaper.
“MFN status will create a competitive environment for the industry and cheaper inputs will reduce the cost of production,” said Muzammil Sultan, Chief Executive Officer of Umer Textile.
According to Sultan, Indian coal-based power plants for textile industries have competitive quality and price when compared with European and Chinese plants.
Owing to the energy crisis, coal-based plants were the key requirement of Pakistani industries, which would be able to import the plants from India, he said, adding bilateral trade would also lessen political tensions.
On the other hand, the agricultural, pharmaceutical and automobile sectors fear they will be sidelined by the giant Indian counterparts, who have much cheaper products.
“Though it (MFN status) will benefit the consumers, it can hurt domestic industries,” said Kamal Mustafa, an agriculturist. He added these industries would definitely suffer after the grant of MFN status to India.
Mustafa pointed out that the cost of production in Pakistan was much higher than India, adding there was also a possibility that MFN status would lead to flooding of domestic markets with Indian goods.
According to leading textile exporters, the government should strike a balance while finalising a negative list of items in trade with India. MFN status would take the country towards liberalisation and both countries would likely reap its benefits, they said.
Published in The Express Tribune, January 25th, 2012.
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"“Though it (MFN status) will benefit the consumers, it can hurt domestic industries,” said Kamal Mustafa...."
For whom does the government work in Pakistan- for industry owners or common man?
Our Pharma and Doctor Mafia is Making Billions. The same drugs is 200 percent Cheaper in INDIA. So they Fear we will loose another Money making industry.??
"On the other hand, the pharmaceutical sectors fear they will be sidelined by the giant Indian counterparts" as India produces pure and genuine active pharmaceutical ingredients for all over the world including US and EU. If Indian drugs were allowed Punjab Institute of Cardiology (PIC) patients would not have died. Each decision has its consequences.