Entrepreneurship: Shunning Wall Street to pounce on a business opportunity

Amber Road Trading Company to connect South Asia with Latin America.

KARACHI: Few people would resign as vice president of the investment banking division at Goldman Sachs in New York City to move onto the uncharted territory of entrepreneurship. Even fewer people would have the audacity to set up a trading company to facilitate import/export between two countries whose mutual trade had practically been negligible for decades.

Jehangir Ilahi – who cofounded Amber Road Trading Company and currently serves as its president – focuses on sourcing and facilitating trade between South Asian and Latin American countries. Although his company was based out of New York, it is perhaps the only quasi-Pakistani firm that maintains a regular office in Mexico with full-time Mexican staff on the payroll.

“The tremendous room for growth in trade between Pakistan and Mexico made me leave my well-paid job in investment banking,” Ilahi said, adding that going forward he would like to expand his company’s operations to Brazil, Argentina, Peru and Chile among others.

Mexico exported goods worth $24.6 million to Pakistan in 2011, which was just 0.1% of Pakistan’s total imports in that year. With a 2% share in global exports, Mexico’s total exports to the world grew by 5% per annum between 2007 and 2011, reaching $349 billion in the last calendar year.

Contrary to imports from Mexico, Pakistan’s exports to the North American country reached $110.5 million after growing at an annual average of 11% in the last five calendar years.

Ilahi said that Pakistan’s exports to Mexico, however small, prove that they were competitive and of acceptable quality. Pakistan should focus on expanding the export market in the existing product lines in the short run at least, which can alone generate exponential growth in bilateral trade volumes, he said.

Almost 40% of Pakistan’s exports to Mexico in 2011 consisted of cotton. Other major exports included manmade staple fibres, sports requisites and articles of apparel. As for Mexico’s exports to Pakistan, almost a quarter consisted of iron and steel, followed by machinery, boilers and chemicals.

Ilahi says both India and China had made Mexicans anxious by increasing their exports at a rapid pace in recent years. While India increased its world exports by 11% annually in the last five years, its exports to Mexico grew by 18% per annum over the same period, signifying the fact that Indians realise the importance of the Mexican export market.

Similarly, China’s world exports increased by 10% annually in the last five years, but its exports to Mexico went up approximately 18% a year over the same period. “Mexicans are culturally close to us and thus understand us better than US or European traders,” Ilahi said, adding that sluggish growth in the economies of Pakistan’s traditional trading partners should push it towards developing trade ties with emerging markets of the Americas.

Speaking to The Express Tribune, Trade Development Authority of Pakistan (TDAP) Director Athar Hussain Khokhar said he was expecting about 60 participants in the Pakistan Expo 2012 – the country’s flagship exhibition starting from October 4 in Karachi – from Latin American countries and Mexico.

Almost half of the participants expected from the Americas are coming from Brazil, Khokhar said. “We are expecting participants from Argentina, Ecuador, Chile, Peru and Mexico as well. Most of them belong to leather, sports equipment and textile sectors,” Khokhar said.

Published in The Express Tribune, October 4^th, 2012.