INTERVIEW WITH SYED JOHAR ALI QANDHARI, A RENOWNED INDUSTRIALIST
Oct 15 - 21, 2012
PAGE: TELL ME SOMETHING ABOUT YOURSELF AND YOUR BUSINESS, PLEASE?
SYED JOHAR ALI QANDHARI: I was born in Karachi in a business family; I took my basic education from Karachi, I went to United Kingdom for higher education. My great grandfather started commodities trading business in 1952; later in 1979 my father established a flour mill, in addition to commodity trading.
After coming back to Pakistan, being the only son, I had no option but to join family business and forgo my dream to take any other profession. Therefore, I chose to continue my father's footsteps. Presently, I am looking after a state of the art Flour Mill and a Rice Mill.
Because of my international exposure and education, I made some very valuable contributions to our family business, we have now Hi-Tech Swiss Made Plants & Machines, to carry out the manufacturing for food processing of international standard. We supply flour to some of the best international food chains in Pakistan. We have some 100-150 employees in our factory and in addition, more than 1000 workforce is indirectly associated with our business. Our main focus is not on maximizing the profits of the company but to provide best flour products to the masses at most affordable prices as flour is our basic food and poor and rich both use it. In addition, we are well aware of our corporate social responsibilities, and we are doing a lot on this front. I have always passion to do something for our trade and industry, therefore, I became Member of Executive Committee of Korangi Association of Trade and Industry (KATI) in 2007 and later the members of KATI reposing the confidence upon me, elected me as Vice Chairman in 2008 & 2009 and Chairman for the term 2010-11. I also have the honour to serve as Chairman of All Pakistan Flour Mill Association and also represent many other Association of Trade Bodies.
PAGE: YOUR VIEWS ON PAKISTAN'S TRADE WITH INDIA, CHINA AND BANGLADESH:
SYED JOHAR ALI QANDHARI: India and China are both very large markets and hence have potential for future growth. Bangladesh is still recovering from economic setback and will need time for full recovery. However, we feel, we should improve our relationship with India and take benefit from its huge market as our culture and eating habits are similar.
PAGE: WHAT ARE YOUR VIEWS ON INDUSTRY IN PAKISTAN?
SYED JOHAR ALI QANDHARI: In present economic and political scenario, doing business in Pakistan is difficult as uncertainty is the greatest hindrance in fusing more capital into any business venture; people are afraid in making investments both human as well as monitory as they are not sure whether they will get fair returns on their investment. Further, the things are aggravated, due to multiple challenges being faced by us like day by day increase in cost of doing business, power outrages, worsening law and order situation, which barred the foreign buyers and investors to come to Pakistan. We are 37% costlier in production than our neighbors.
Due to these reasons, industries are moving to other countries where power is available and at cheaper rates, the law & order is conducive for business. To overcome these challenges two types of measures are required to be taken to address the ailing economy; one the short term, measures like improving the law and order of country, specially at the business hub of Pakistan; Karachi, ensuring uninterrupted supply of gas and electricity to keep moving the wheel of industry. Other are long term; like gradually lowering the interest rate. Increasing the tax net, by bringing all the income earners in the tax net so that our tax-to-GDP ratio could be increased and more money would be available for public development projects. I see a very challenging future specially form neighboring countries as they could produce much cheaper products and could capture major markets. However, I am optimistic about the future as Pakistan is full of natural as well as human capital and with good governance and long term business friendly policies we can turn the table.
PAGE: HOW WOULD YOU COMMENT ON EXPORT AND IMPORT DURING CURRENT FISCAL?
SYED JOHAR ALI QANDHARI: Pakistan's international trade is suffering from huge amount of deficit due to low demand for its exports. Domestic political instability also accounts for trade deficit. The trade deficit stood at US$3.946 billion in 2011..
Steps have been taken to liberalize the trade and investment regimes of the country. Due to increasing current account deficit, the trade gap range of maximum tariffs was raised from 20%-25% to the 30%-35% on 300 luxury items by Pakistani government in the budget. This measure brought about the decrease in imports and the increase in exports, thus lowering trade deficits from US$9.261 billion in 2009 to US$3.946 billion in 2011.
PAGE: DO YOU THINK THE CURRENT MONETARY POLICY WILL HELP PROMOTE PRIVATE SECTOR?
SYED JOHAR ALI QANDHARI: If we overview the performance of present government, which is an elected one, we can fairly say that government is not up to mark in devising economic policies. The main reasons is perhaps that the government is not properly focusing on addressing the economic issues of the country and in my view this is due to utilizing its energies on the issues being faced to cope terrorism, Afghan war and politically stabilizing the government. There is much more to do to improve the economic conditions, like increasing the revenue base and bringing the nontax payers in tax net, monitory control over bank borrowing and foremost control corruption. There are many incentives government can extend to industrial sector to increase business and industry in Pakistan. Among them are ensuring uninterrupted supply of gas and electricity to keep moving the wheel of industry. Conducive law and order. Minimum interference from government in business as at present there are a number of government departments which monitor the industry like labour, local administration, health, safety, fire, etc. lowering the interest rate to a level of 3-4% which is hovering presently at around 10-12%. Further, the trade development, social security and health insurance institutions should be headed by persons from business community.
PAGE: YOUR VIEWS ON SPECIAL ECONOMIC ZONES IN PAKISTAN:
SYED JOHAR ALI QANDHARI: I fully endorse development of SEZs in Pakistan as we are rich in minerals, crops and other natural resources and until and unless we have special zone with outclass incentives, we could not take full benefits of our resources