MUHAMMAD NAQI has been associated
with electronics market for over two decades. He has witnessed the
blossoming of the electronics market along, and around the Abdullah
Haroon Road in Karachi from hundreds of shops to nearly 4,000 retail
outlets today. He claims that the market is the biggest electronics
market anywhere in Asia, including Japan, as far as number of shops is
concerned. However, he laments that despite contributing billions in
revenues under various heads; Income tax, professional tax, sales tax,
etc., it has not accorded the recognition that it deserves officially.
Naqi, better known as Chand by friends and acquaintances, is a former
vice chairman of Pakistan Electrical and Electronics Merchants
Association and is currently a member of the Executive Committee of
Karachi Electronics Dealers Association. He is pleased by the directive
recently issued by the Governor of Sindh, Ishrat-ul-Ibad declaring
Abdullah Haroon a VIP Road deserving special spic and span treatment and
whitewashing of the buildings along it to enhance its looks.
What's the most significant change the market has
witnessed in the recent past?
The mobile phones have totally changed the
mosaic of the market during last 7 years. Two decades ago there were a
cluster of around 1,000 big shops the sizes of which have shrunk to
accommodate four-time more retail outlets today. Besides selling a range
of electrical and electronics items the majority of these shops also
sell mobile phones primarily due to high sales of sets, accessories and
peripherals. Karachi has become the largest sales point of mobile phones
in the country. The market is flooded with not only used phones but also
by new ones finding their way into the country both legally as well as
Will you please elaborate?
According to estimates over two-third or
around 1 million of the total 1.5 million mobiles sets operative in the
country were issued in Karachi. In last six weeks alone, an estimated
125,000 mobile connections were provided by a single mobile operator in
the city. Actually the number of mobile phone connections given in the
city would be higher as two other operators are also giving the
connections in the city.
PAGE: Why mobile phones have become such a
Karachi has become a dumping ground of used
and refurbished sets, the primary source of which are Hong Kong, Mexico
and the US. Hong Kong itself has become an international market of
refurbished cellular phones followed by Mexico and the US. The demand
for used and refurbished mobile phones in Karachi, and for that matter
the rest of the country, is due primarily to the reason that Pakistan is
one of the few countries in the world where Ems system is still
operating. Though two of the four mobile operators are providing GSM
technology the other two are still operating on the Ems system. However,
one of them will be converting to GSM in September. While Hong Kong,
Mexico and the US have become the major sources of these Ems mobile
phones. The UK has recently emerged as a supplier of used GSMs sets.
Lately, the Philippines has also started to emerge as the latest source
of refurbished cell phones. The demand for used and refurbished cell
phones itself is driven primarily by two factors, affordability and the
fact that expensive phones become redundant with incessant introduction
of newer models. Over two-third or around 65 per cent of all the mobile
phones sold in Karachi are used while expensive and new sets are bought
only by the aflluents.
How do you view the role of dry ports up
Across the world dry ports serve as 'sub
stations' to facilitate exports. Here they are permitted to perform an
entirely opposite function purpose, that is to serve as warehouses for
imports. They are encouraging unethical practices the most hurting being
mis-declaration and under-invoicing. The fact that many Karachi-based
importers are using dry ports up country clearly proves that something
is gravely wrong. Or why else these importers prefer to use dry ports
instead of seaports in Karachi near their operational base. The practice
defies any and all logic. Not only Karachi is deprived of substantial
revenue by losing billions in customs and duties but the rampant
unethical practices at these dry ports is also depriving the national
exchequers of massive revenues.
There is a plethora of complaints that mobile
phone dealers never honour the warranty. Why?
Individual dealers in the electronics market
have started to issue their own guarantee at a cost to the buyers. They
have followed the example of the four mobile operators who issue a
one-guarantee at a cost which are meant not to be honoured. For
instance, one-warranty for a Rs 5,000 set costs a buyer Rs 500. The
dealers too have find it to sell a similar guarantee at a cost with
intention not to honour it. Such useless guarantees are nothing but
rip-offs and the menace need to be stopped by the authorities.