MAJYD AZIZ is
a well known industrialist and a business figure. He is the former
chairman of SITE Association of Industry and the founder and
ex-secretary of Pakistan Italy Business Forum and is actively involved
in numerous other industry, trade and business and activities. Born in
Karachi, Majyd completed his high school education there. He did B.S. in
General Business Administration from Ball State University, Muncie,
Indiana. He did Masters in Management from the same university in
1972-73. He has emerged as the strong proponent of unrestricted trade
between Pakistan and India and feels that 'it's time to shed the myopic
thinking to get out of the cocoon' for the greater people of a people
which collectively represent one-fifth of the humanity. He also feels
that the absence of a free-trading bloc; like NAFTA, EU and Asean, makes
bilateral trade between the two countries all the more important. He
however, advocates for a 'meaningful' trade with India — importing
machinery and engineering goods instead of consumer products, many of
them harmful. He says that Pakistani textile industry, of which he is a
part, would benefit from the bilateral trade finding in India a
competitive source for raw materials, dyes, chemicals, machinery, etc.
What are your expectations from the Budget 2003-04?
MAJYD AZIZ: To
document the economy it is necessary to provide inducements and
incentives rather than making it a cumbersome event. Why should anyone
bother to register knowing the difficulties and problems faced by those
in the tax net. The past history is full of examples where only those
who were registered suffered. The Finance Minister must address this
issue. The present backbreaking 15-18% rate is criminal, it leads to
temptation to evade, and is keeping traders and industrialists from
registering under the system. The GST must be enforced with
determination and must be broad-based with all links in the chain
covered. But, more importantly, it is imperative that the GST rate is
reduced to not more than 5% otherwise, this scheme will be difficult to
implement and will remain hostage to the corruption syndrome.
What are the major impediments to exports?
The question which is of significant importance, is whether Pakistan
will be able to formulate a pragmatic, workable, and effective export
policy or whether there will be a continuation of the adherence to the
present dilly-dally attitude towards exports. It should be noted that
although exports are not the only panacea for the economic development
of any country, the case for Pakistan takes on a very profound
understanding of the critical need to expand the export base. Pakistan,
like other developing countries, will be compelled to fundamentally
restructure her mode of manufacturing for the world market. The present
ad-hoc policies of the administration, the rigid nature of government
officials, and the plethora of bottlenecks and hurdles in matters of
exports, have been classic deterrents in boosting the nation's exports
all these years.
important is it to find new export markets?
MAJYD AZIZ: It
is imperative that the concentration of the manufacturers should be
based on product and market diversification. Pakistani exporters can
develop relations with businessmen in Africa, and even Burma, to explore
possibilities of joint ventures. Pakistan must target the African market
on an imperative basis. As it is, 68% of Pakistan's exports are limited
to just ten countries. Pakistan's share of the global export market of
nearly US$ seven trillion is only 0.15%. Pakistan exports 57% to the
developed countries while only 3% to the other SAARC countries.
What can explain the low productivity?
MAJYD AZIZ: Over
the past decades, scant attention was paid to the concepts of
productivity and it was generally relegated to a low priority within the
organizations. The effect of low productivity was one prime reason for
missed deadlines, for product deficiency, and for cost over-runs. The
garment exporters in Pakistan are more abundant in the small and medium
sector. One characteristic of these units is that most of their
workforce is employed under a contract system. This means that a
designated contractor is the primary employer and the units in which
these workers produce goods are secondary employers. The result has been
that though there has been more productivity through contract workers,
the toll on these workers' lives has been considerable. Even though the
remuneration of the contract workers is based on output, the fact of the
matter is that these workers do not receive other fringe benefits, such
as statutory bonus, gratuity, social security, EOBI, and job security.
we prepared for the WTO?
MAJYD AZIZ: The
challenges of the new world trade system would unleash all external
forces that could become overwhelming factors in becoming obstacles to a
smooth trading scenario. Pakistan has an opportunity to survive and
compete in the quota-free environment. The three important factors that
the exporters must adhere to and must religiously subscribe to are
Compatibility, Competitiveness, and Credibility. The exporters, on an
individual level, and the employers' and workers' associations and
government, on a collective level, must initiate programs and strategies
to focus on the achievements of the three Cs.