Communication Industry

Compiled by: Mirza Rohail B

Pakistan is on the verge of Telecom revolution. Pakistan Telecommunications Authority (PTA) in 2004 introduced  two types of license for ISPs – regional and nationwide, and also exempted them from Central Excise Duty. Since liberalization, over the past four years, the Pakistani telecom sector has attracted more than $9 billion in foreign investments. During 2007-08, the Pakistani Communication sector alone received $ 1.62 billion in Foreign Direct Investment (FDI) – about 30% of the country’s total foreign direct investment. 

telecom-national-exchequer

By March 2009, Pakistan had 91 million mobile subscribers – 25 million more subscribers than reported in the same period 2008. In addition to 3.1 million fixed lines, while as many as 2.4 million are using Wireless Local Loop connections.

Pakistan is ranked 4th in terms of broadband Internet growth in the world, as the subscriber base of broadband Internet has been increasing rapidly with the total base crossing 170,000 in the country. The rankings are released by Point Topic Global broadband analysis, a global research centre.

Pakistan according to PC World was amongst those top five countries with the highest SMS traffic processed with 763 million SMS during 2008-09. In terms of year-on-year growth, Pakistan traffic volume grew by 253 percent compared to last year during the same period.

The 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.

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Filed under Industrial sector, Investment, Pakistan Economy, Telecom and I.T Industry

IT Industry overview

The IT and IT-enabled Services (ITeS) marketplace offers lucrative opportunities for developing countries to join the  ranks of the developed world. The scale and pace of growth in this sector is faster than in any other industry, and a number of developing countries are attempting to emulate the success enjoyed by countries such as China, Thailand and India.

Future IT Tower KHI

Future IT Tower KHI

The Government of Pakistan has been proactively developing the IT sector in Pakistan since the last few years. A few of the incentives offered include tax exemption till 2016, establishment of IT Parks with low rent, foreign ownership of equity invested in IT and 100% repatriation of profit allowed to IT companies.

State Bank Reporting Earnings Estimated Total IT Industry Export Revenue
Estimated Total IT Industry Size
US$ 116m US$ 1.4b US$ 2.8b

 

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Filed under Pakistan Economy, Telecom and I.T Industry

Cement Industry

Compiled by: Mirza Rohail B 

History & Introduction

 Growth of cement industry is rightly considered a barometer for economic activity. In 1947, Pakistan had inherited 4 cement cement_industry1plants with a total capacity of 0.5 million tons. Some expansion took place in 1956-66 but could not keep pace with the economic development and the country had to resort to imports of cement in 1976-77 and continued to do so till 1994-95. The industry was privatized in 1990 which led to setting up of new plants. Although an oligopoly market, there exists fierce competition between members of the cartel today.

The industry comprises of 29 firms (19 units in the north and 10 units in the south), with the installed production capacity of 44.09 million tons.  The north with installed production capacity of 35.18 million tons (80 percent) while the south with installed production capacity of 8.89 million tons  (20 percent), compete for the domestic market of over 19 million tons. There are four foreign companies, three armed forces companies and 16 private  companies listed in the stock exchanges. The industry is divided into two broad regions, the northern region and the southern region. The northern region has around 80 percent share in total cement dispatches while the units based in the southern region contributes 20 percent to the annual cement sales.   

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CNG Industry

cng-3Compiled by: Mirza Rohail B

Compressed Natural Gas (CNG) is a substitute for gasoline (petrol) or diesel fuel. It is considered to be an   environmentally “clean” alternative to those fuels. It is made by compressing methane (CH4) extracted from natural gas. Argentina and Brazil are the two other countries with the largest fleets of CNG vehicles. As of 2005, Pakistan is the largest user of CNG in Asia, and  as of 2010, the largest in the world, according to the The International Association of Natural Gas Vehicles (IANGV).

The Compressed Natural Gas (CNG) sector of Pakistan by end of 2007 has attracted over Rs 70 billion investments during the last few years as a result of liberal and encouraging policies of the government.  Presently, around 3,105 CNG stations are operating in the country in 85 cities and towns, and 1000 more would be setup in the next three years. It has provided employment to above 30,000 people in Pakistan.

Over 2.4 million vehicles were converted to CNG as of end 2009, showing an increase of 35 percent yearly. On average 29,167 vehicles are being converted to CNG every month. All Pakistan CNG Association (APA) Sana-ur-Rehman confirms that CNG stakeholders have invested Rs.90 billion in this sector and another Rs 20 billion investment is in pipeline. The CNG consumers had invested around Rs 60 billion in converting their vehicles to CNG.

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Filed under Automobile Industry, Industrial sector, Pakistan Economy

Automobile Industry

updated 27 Jan 2010!
 
Compiled by: Mirza Rohail B 

Pakistan is an emerging market for automobiles and automotive parts offers immense business and investment  production-volume-2007-081opportunities. The total contribution of Auto industry to GDP in 2007 is 2.8% which is likely to increase up to 5.6% in the next 5 years. Total gross sales of automobiles in Pakistan were Rs.214 billion in 2006-07 or $2.67 billion. The industry paid Rs.63 billion cumulative taxes in 2007-08 that the government has levied on automobiles.There are 500 auto-parts manufacturers in the country that supply parts to original equipment manufacturers (PAMA members). Auto sector presently, contributes 16% to the manufacturing sector which also is expected to increase 25% in the next 7 years, as compared to 6.7 percent during 2001-02.Vehicles’ manufacturers directly employ over 192,000 people with a total investment of over $ 1.5 billion. Currently, there are around 82 vehicles’ assemblers in the industry producing passengers cars, light commercial vehicles, trucks, buses, tractors and 2/3 wheelers. The auto policy is geared up to make an investment of $ 4.09 billion in the next five years thus, making a target of half a million cars per annum achievable.

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Textile Industry

Compiled By: Mirza Rohail B

Historically, Pakistan’s textile industry and clothing sector has always been a major contributor to the foreign exchange  earner and still contributes about 55% to the total export proceeds.

textile-to-exports1

The Economist reports that Pakistan is the 4th largest producer of cotton in the world and the 6th largest importer of raw cotton, the 3rd largest consumer of cotton, and the 1st largest exporter of cotton yarn. Over 1.3 million farmers, out of total of 5 million are involved in cultivation of this crop.

Textile exports in 1999 were $5.2 billion and rose to become $10.5 billion by 2007. Textile exports managed to increase at a very decent growth of 16% in 2006. In the period July 2007 – June 2008, textile exports were US$ 10.62 Billion.  Textile exports share in total export of Pakistan has declined from 67% in 1997 to 55% in 2008, as exports of other non-textile sectors grew.

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Education Sector: Revolution Imminent

Compiled By: Afreen Baig and Mirza Rohail B

Pakistan has an estimated population of 170 million, above two per cent of the world’s population and it’s the 6th  largest country of the world.

Pakistan’s literacy rate was currently estimated at about 50% according to the United Nations Development Program 2009. As per the PSLM Survey 2004-05, the literacy rate of population 10 years and above was 53% showing an annual growth ratio of 1.5% since the 1998 census. As such, the estimated Literacy Rate comes to 56% in 2007. According to the statistics, Pakistan has made some steps forward trying to educate its children, but still there are around some 13 million children that do not receive any education and instead work or hard labor jobs or even in the streets, being completely or almost illiterate. Statistics indicate that India with 61%, Sri-Lanka with 90%, Iran 82% and China 93% are the few Asian countries with much faster development rate than Pakistan.

According to statistics by the Ministry of Education, there are 256,088 educational institutions of all categories in Pakistan, with a total enrollment of 37,462,884 students. 

 There are 182,477 (71%) education institutions in the public sector and 73,611 (29%) in private sector. Enrolment wise, public sector has an enrollment of 25,213,894 (67%) in various categories of educational institutions whereas 12,248,990 (33%) enrolment is in the private sector. The total male student enrolment is 21.133 million (56%), whereas the total female student enrolment is 16.329 million (44%). The total teaching staff is 1,363,501, out of which 0.756 million (56%) is in the public sector and 0.606 million (44%) in the private sector. Out of the total 1.363 million teachers, 0.617 million (47%) are male and 0.695 million (53%) are female teachers.

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