Establishment of a joint venture company by the business
consortiums of Pakistan and Indonesia is likely to be a turning point for a
massive promotion of bilateral trade between the two countries.
The project is aimed at making use of Karachi as a gate-way
of Indonesian export products, not only for Pakistani market but also regional
markets as proposed by Indonesia's Minister for Trade and Industry during his
visit to Islamabad last June has finally been kicked off.
In order to give a concrete shape to this objective, the
representatives of Pakistan and Indonesia business consortium met at simple
ceremony held in the premises of Indonesia consulate general in Karachi last
week to sign the Letter of Intent (LOI) for the establishment of the joint
venture company. Iswayudha, vice consul of Indonesia at Karachi, conducted the
LOI signing ceremony.
Indonesian businessmen Kusuma Darma, Sulaiman and Sutijipto
Widjaja represented the Indonesian business consortium, PT. Cipta entral
Cemerlang, while Sheikh Amjad Rashid, Sheikh Abdul Waheed and Mohammad Hussain
represented the Pakistan side.
The prime objective of this joint venture company is to set
up warehouses, showrooms, offices and other facilities to promote exports of
various Indonesian products in Pakistan as well as in the countries of the
region including Central Asia and Middle East.
This joint venture company will also set up warehouses,
showrooms, offices and other facilities in Jakarta to give greater access for
Pakistani products in Indonesia and other ASEAN countries.
For this purpose, the joint venture companies will be
incorporated in both the countries.
The joint venture company has been given the name
"Indonesia Pakistan Products (Pvt.) Limited", while in Indonesia it
will be working under the name of "PT Produk Indonesia Pakistan".
Both the Pakistani and Indonesian companies shall have a
Board of Directors consisting of six persons three to be appointed by each of
the parties hereto. The companies will also have a chief executive officer and a
finance officer who would be a professional selected by the Board of Directors.
Speaking on the occasion, Consul General Ali Ardjoeno said
that the key to success in all spheres of life especially in today's competitive
world is to ensure quality of products. He recalled various instances when the
businessmen of Indonesia as well as Pakistan had lodged complaints about the
products they imported in their respective countries. He said that such
complaints always create an atmosphere of mistrust and ultimately prove to be
counterproductive for economic growth of any country. While narrating his
personal experience while he was in Japan he paid glowing tributes to the
quality consciousness of Japanese entrepreneurs. He said his son had bought a
toy from Japan, which was not functioning properly. He contacted the
manufacturing company of the toy. They responded immediately and not only
replaced the toy with a perfect one but also interrogated into the affairs,
which allowed releasing an imperfect toy into the market. This is the way to
earn a respectable place in the market he said and advised the business
representatives of the two countries to give top priority to the quality of
The two sides were however in agreement to appoint experts
for maintaining the quality control of the products.
Sheikh Amjad Rashid, leader of Pakistan business consortium,
while talking to PAGE said that so far the Indonesian products arriving
into Pakistan were routed through neighbouring countries like Malaysia and
Singapore. With the establishment of this joint venture company both the
countries will be able to enhance trade volume due to direct links between the
trade communities of the two sides. As a result of this joint venture the
involvement of foreign exchange may also be reduced to a great extent, as most
of the transactions are likely to be made on commodity exchange basis. Sheikh
Amjad also feels that joint efforts by the two sides may help enhancing export
of products in the region. For that purpose warehouses are being set up at
Karachi and Jakarta.
The understanding has been stipulated in a Letter of Intent (LOI)
that was signed in the Consulate General of Republic Indonesia in Karachi last
The LOI has been made in furtherance of the desire to expand
and develop business ties between the two brotherly countries. It has also been
formulated in pursuance of the Memorandum of Understanding (MOU) between the
government of Pakistan and Indonesia on the establishment of Pakistan Indonesia
Consultative Forum, signed in Jakarta during the visit of the Chief Executive
Gen. Pervez Musharraf on March 30, 2000.
It is emphasized in the MOU that the two parties shall
explore and employ all possible ways and means to enhance interaction between
communities of the two countries and to identify and fully exploit the trade
potential and to strengthen economic and commercial relations.