Interview with Mr Gul Mohammad Lot – Chairman, Mehran Group of Industries
Mr Gul Mohammad Lot was born in Pakistan in the Diplo area of Thar District. At a very young age, he joined his father, Mr. Ghulam Muhammad Lot, in his business. He is currently a Chairman of Mehran Group of Industries. As far as education is concerned, he completed his Bachelors in Administration from the London School of Business and obtained Master’s Degree in Political Science from the University of Sindh, Hyderabad. As a student of Political Science and a compassionate patriot, he joined politics in Pakistan as a member of the Pakistan’s People Party. In 1990, he was elected as MPA Sindh representing his roots from Thar District. Once again, his passion and drive earned him the honor to be appointed as Minister for the Environment where he was committed for the betterment of constituents and native land. He participated actively in regional and national politics. From 2001 to 2007, he got the privilege and opportunity to work with Mohtarma Shaheed Benazir Bhutto. He continued serving the country under the honorable Chairperson who served as a mentor. In May 2008, he was appointed as the Advisor to the Chief Minister Sindh for Anti-Corruption Enquiries and in March 2009, he was elected as the Senator unopposed.
MEHRAN SPICE & FOOD INDUSTRIES: Mehran Spice & Food Industries (MSFI) started its journey in 1975 and within a few years of its inception, the company grew to become one of the leading spice & food industries globally. MSFI is an ISO 22000 & HACCP certified leader in the food industry. Our mission is to be a consumer-oriented company to ensure quality, consistency and an authentic taste. MSFI has been honored with many national and international awards including winning the Best Export Award from the FPCCI consecutively since 1984, multiple Business Man of the Year Awards and the coveted Presidential Gold Award.
PAGE: KINDLY SHARE WITH US THE CSR ACTIVITIES OF YOUR ORGANIZATION:
GUL MOHAMMAD LOT: The trust of our customers has ensured that Mehran has taken a huge market share in Pakistan. There is a lot of potential in rural development particularly in the livestock sector. Mehran is adding real value for improving the quality of life in rural communities. MSFI is involved in many CSR (Corporate Social Responsibility) activities in Pakistan. Some are mentioned below:
1) Mehran is engaged in providing many schools, colleges and elderly women with its food products for social welfare.
2) Improving health & hygiene conditions by providing the needy with pure water facilities like installing RO Plants in various areas in Thar district.
3) Promoting sustainable workplaces by improving employee lifestyles encouraging diversity and creating an environmentally friendly atmosphere.
4) In our organization, employees are like family and in most cases, the company pays for their children’s education. An employee with a positive attitude towards the company is less likely to look for a job elsewhere. It is also likely that “you will receive more job applications because people want to work for you.”
5) Providing financial support to several people in order to enable the outreach of education to the underprivileged across Pakistan.
6) Social responsibility towards the environment by reducing carbon footprints.
CSR is a good thing in itself since it leads to better treatment of stakeholders, improved code of ethics, better conditions for employees and less damage to the environment etc.
PAGE: WHAT MUST BE DONE TO GENERATE EMPLOYMENT OPPORTUNITIES IN PAKISTAN?
GUL MOHAMMAD LOT: Healthy economic growth naturally creates jobs. Businesses hire additional workers to produce enough goods and services to meet rising demand. A free market economy allows small businesses to compete, creating better ways to meet consumer needs.
The proper role of the government in this healthy economy is to provide a supportive environment for growth. However, even a healthy economy is subject to the bubbles and busts of the business cycle. When the economy contracts into a recession, the government must step in through expansive monetary and fiscal policies to stimulate job growth. The best way for the government to reignite job creation after a recession depends on what caused the contraction and what is preventing a natural return to expansion.
There are a number of ways to create more employment opportunities:
1) The most common strategy would be the expansionary fiscal policy. The government increases its spending and in turn increases the aggregate demand of the economics. Hence, the social output level rises and more employment opportunities are created.
2) Another popular strategy is expansionary monetary policy. The central bank can lower interest rates. Lower interest rates discourage saving and provides greater incentive for consumption and investment. Hence, aggregate demand rises. Again, social output and job opportunities increase.
3) The government can reduce the penalty of business failure such as shortening the time before failed businessmen are allowed to restart their business or reducing the difficulty in getting business loans. Such policies encourage more people to start their own companies. As more companies are set up, more jobs are created.
4) The government can provide subsidies for companies to expand their production in order to increase job opportunities. Also, the government can set up skill upgrading agencies to allow workers to have the means to upgrade their skills and improve their productivity. As the aggregate supply increases, the social output and employment opportunities increase. At the same time, subsidies and better labor productivity can attract foreign direct investment. These investment further shifts the aggregate supply curve downwards and increases job opportunities.
PAGE: YOUR VIEWS ON POVERTY IN PAKISTAN AND THE ROLE OF CORPORATE SECTOR:
GUL MOHAMMAD LOT: Poverty in Pakistan is a growing concern as it is a developing country. Although the middle-class has grown in Pakistan, nearly one-quarter of the population is classified as poor. The literacy rate of Pakistan is still very low. Most people do not have any concept about the modern earning sources. Most people are unable to adopt technology for their business needs, which is why businesses do not meet international standards and resulting in lower revenues, which leads the society to poor financial conditions.
Pakistan’s import is greater than its export. Big revenue is consumed in importing goods every year. The people will have better opportunities to earn if we decrease our imports and establish our own supply chains from our country’s natural resources. The main reason for poverty is the dishonesty and irresponsible behavior of people. Everyone is trying to get rich by using unfair means. People doing jobs need to improve their performance. Many people do not pay taxes or continuously violate the laws. This irresponsible behavior continuously increases losses for the country. Pakistan has a lowest ratio of tax payers. Poverty also leads to diseases because poor people cannot afford hygienic food and pure drinking water. Many infants born into poverty have a low birth weight, which is associated with mental and physical disabilities. It is not enough for successful companies to purely pursue profits. They need to play a leading role as agents of social, environmental and economic progress. They should enthusiastically embrace and adopt the notion of ‘Corporate Citizenship’. In conclusion, if healthy corporations join and contribute towards establishing better infrastructure and services, this can go a long way in reducing poverty.
PAGE: YOUR VIEWS ON THE RECENT BUDGET FOR THE POVERTY-STRICKEN INDIVIDUALS IN OUR COUNTRY:
GUL MOHAMMAD LOT: For the first time in the history of Pakistan, the same elected Prime Minister and Finance Minister are presenting the national budget for the fifth consecutive year. This reflects strengthening of the democratic tradition, continuity of economic policies witnessed in the prevailing fiscal stability in the country.
When we compare the economic performance of 2016-2017 vs 2012-2013:
i) GDP growth has registered an increase of 5.28% compared to 3.7%. This is the highest in the last ten years and above the world average of 3.5%.
ii) Inflation has remained moderate around 4% as compared to 7.4%.
iii) The budget figures claimed by the government is higher than most developed countries, yet however, it is not reflected on Pakistan’s poor population or common man.
iv) The overall amount spent in Pakistan on health and education is much lower than what is spent on neighboring countries. The federal and provincial governments need to substantially increase this budget.
BUDGET STRATEGY 2017-18:
The minimum wage of labor should be increased from Rs14,000 to Rs15,000 per month.
The federal government has proposed an increase of 10 percent in salaries and pensions of government employees in Budget 2017-18. Similarly, the government has announced a 10 percent increase in net pension to all pensioners of the federal government. New initiatives need to be being announced for agriculture, financial sector, exports, textiles, social sector and employment generation. Investments need to speed up on the development of Gwadar including establishment of airport, hospitals and desalination plants.
The Benazir Income Support Program (BISP) Beneficiary Graduation Program Grants – to self-sustain individuals: BISP beneficiary families will get training and be facilitated to start their own business with a one-time cash grant of Rs50,000. Initially, 250,000 families will be targeted with a size of Rs12.5 billion. Increase in BISP allocation: Around 5.5 million people (mostly women) will be provided with cash transfers of Rs19,338 per annum, for which Rs121 billion will be allocated to the BISP. This allocation is an increase of 300% of the Rs40 billion allocated in FY 2012-13.
SCHEME FOR DISABLED PEOPLE:
The provision of 2 percent employment quota to be extended to public and publically-listed companies. Pakistan Bait Al Mal budget increased from Rs4 billion to Rs6 billion which will be utilized for financial assistance to individuals, child support programs and orphanages through Pakistan Sweet Homes and Thalassemia Centre for treatment of poor children.
The Prime Minister’s Youth Schemes, which include business loans (interest free), training schemes, skill development programs, fee reimbursement for students of backward areas, laptop programs and health insurance programs will continue. For this Rs20 billion have been allocated in FY 2017-18. In my point of view, the above recent budgetary measures would be helpful to reduce poverty in our country.
PAGE: GIVE YOUR VIEWS ON YOUTH UNEMPLOYMENT IN PAKISTAN AND THE ROLE OF THE CORPORATE SECTOR:
GUL MOHAMMAD LOT: The foremost problem the world is facing today is unemployment. The ratio of unemployment is increasing rapidly due to a lack of sources. Crimes are automatically created when unemployment takes place. Pakistan has plenty of problems these days and unemployment is one of those. Unemployment causes numerous problems for people of the nation.
Pakistan has countless natural resources but the problem is that these resources are being wasted since the independence of Pakistan in 1947. You may find many graduated, masters, IT experts, engineers and doctors wondering about for job opportunities due to bad employment systems. The people of Pakistan are highly talented and hardworking, a good number of them leave their country to work in foreign countries because of higher salaries, security, better infrastructure and improved quality of life.
The following steps must be taken by the people and the government to control the problem of unemployment and under-employment:
ESTABLISHMENT OF EMPLOYMENT OFFICES:
There is not a single office for the information about employment opportunities in Pakistan. More and more employment offices should be established, these would cause a reduction in unemployment.
Aggregate saving and investment should be increased to raise the level of capital formation. This will result in promoting the level of income and employment in the economy.
GROWTH OF INDUSTRIAL SECTOR:
The government should provide basic infrastructure to established industries in rural areas. The growth of industrial sector is needed to reduce unemployment.
GROWTH OF AGRICULTURAL SECTOR:
Agriculture is the main sector of our economy. It provides more jobs to the population. It is necessary to establish it on a commercial basis to provide more jobs to the unemployed. Our government should spend more on improving the growth rate of the various seeds used in farming. Our neighboring countries, especially India and China have spent vast resources on their seed output, hence having twice the growth rate of Pakistan’s yield per acre (mainly for rice and cotton).
TECHNICAL EDUCATION AND TRAINING:
Technical education and training is necessary to produce an efficient labor force.
PROVISION OF SELF EMPLOYMENT:
People and the government should maintain self-employment. In this case the government should provide credit facilities on easy terms.
GROWTH OF SMALL SCALE AND COTTAGE INDUSTRIES:
The government should encourage and provide incentives for the setting up of small industries, particularly in rural areas. The government should provide subsidies and infrastructure to establish small industries.
USE OF LABOR INTENSIVE TECHNOLOGIES:
It is compulsory to use labor intensive technologies to reduce the unemployment.
SUBSIDIES TO PRIVATE SECTOR:
The government is required to subsidize the private sector. Government should help the private sector to develop. It will create more employment chances.
JOBS ON MERIT:
The government should eliminate nepotism and favoritism. Employment opportunities should be provided in accordance to skill and ability.
ROLE OF CORPORATE SECTOR:
The corporate sector should play a positive role for increasing employment numbers. For example, Mehran Group has increased its investments three-fold and has introduced new product lines which have lead to higher employment. The corporate sector can help to reduce employment by investing their earnings. The government should offer rebates and incentives for companies that offer employment to more staff.