The development of engineering industry worldwide is characterized with an all out government support


May 10 - 16, 2004





After a long neglect, Pervez Musharraf's government realized the importance of engineering industry to provide a solid footing to the nation's economy and came out in 2002 with an ambitious "10 years engineering vision" plan envisaging 10 to 12 billion dollar investment to increase the share of industrial and manufactured goods by 25 and 30 percent respective in the GDP during this period.

The engineering vision prepared by the Ministry of Industry and Industrial Development Board under the supervision of the then Minister for Industries Razaq Dawood, aimed to develop engineering industry to be able to export industrial products and manufactured goods to $5/6 billion by 2010 from 270 million dollar at present against a world market of $ 6 trillion.

The plan, which was announced by the President himself with a big fanfare, seems to have been put at back burner by the elected government of Prime Minister Mir Zafarullah Khan Jamali. Inquiries by this correspondent revealed that no significant measures have been taken to implement the plan and things were moving at a snail pace.

The development of engineering industry worldwide is characterized with an all out government support. In Pakistan this support has not so far been so visible if not absent. As a consequence our engineering industry remains far from achieving its true potential in the face of rising imports of capital goods. Due to vested interest, the country continues to have basically cotton-based economy, which offers limited opportunities for future expansion and growth. For achieving major economic strides, it is essential that our reliance is shifted to other high value added areas like engineering goods industry otherwise we would be left far behind in the 21st century world of science and technology.

Deficit financing, adverse balance of payment situation and inflation are the key factors at the macro level that are responsible for the economic disaster in Pakistan. At the micro level it is attaching low priority to the development of the engineering industry and the adoption of negative attitude towards a Research and Development (R&D) based policy and promote the transfer of technology and development of an indigenous industrial base that have not provided any chance of self-reliance. The net result has been the primary manufacturers, low value addition and low level of technology.

With the advent of WTO, the economics are getting integrated and only the most competitive and innovative shall survive. Keeping in view the above fact there is a dire need of the long run objective for competitive industry, which may require Simultaneous implementation of the following three areas: (a) Leveraging Existing Industrial Strengths. (b) Creating a strong intermediate sector and Domestic Linkages (c) Creating External Linkages through FDI.



Realizing the importance of long term planning the present government decided in the year 2000 to formulate a ten year "Engineering Vision 2010" to achieve desired economic growth and become "Asian Tiger" in the foreseeable future. This long-term vision was based on export-led industrial strategy to increase 5 to 6 billion dollars exports of Engineering Goods annually through diversification and deepening of the resource-based and non-resource based industries. The emphasis will be on full integration of manufacturing operations through value chain to enhance industrial linkages and to increase productivity and competitiveness by 1) Global Orientation. 2) Public/Private Sector Industry. 3) Productivity Enhancement and Quality/Standard. 4) Industrial Database. 5) Balanced Regional Industrialization. During the last two years, however, very little has been achieved in terms of the objective of the vision.

The then Minister for Industries, while unfolding engineer vision had told the newsmen that the engineering vision and the defence product export organization set up by the Musharraf government would help boost our export by over 25 percent during fiscal year 2002-03 and by about 50 percent by 2004-05. He boastfully said that he saw no difficulty in achieving this target. He advised the entrepreneurs engaged in the engineering industry to make concerted efforts to penetrate into the markets of Malaysia and Thailand, which had a potential demand of $ 30 billion engineering goods, and Pakistan with little initiative can claim a reasonable share.

For the first time in decades the government seemed to be in the right direction as it is a universally accepted fact that the economic development as well as the defence potential of a country is directly linked with the technological level of engineering industry. This specially applies to Pakistan which does not have aburdant natural resources like oil and it has to drew its strength directly from its engineering goods sector.

"Engineering Vision" was the first major step taken by any Government in Pakistan to realize these basic objectives of country's economy. It should not be allowed to be placed in cold storage or at the back burner. Prime Minister should reactivate the plan and save the elected government from being charged with shelving a very useful plan because of sheer indifferent and lethargic attitude.