May 17 - 23, 2010

Speakers at a forum in Islamabad last Thursday were of almost unanimous view that Pakistan's Engineering Industry, despite presently being small in terms of size with its negligible contribution to GDP and exports, has a vast potential to grow and make a much higher contribution to exports and GDP of the country. During the financial year 2008-09, Pakistan exports of engineering goods contributed only $812 million which came to only 4.61 per cent of Pakistan's total exports of $17627 million. The industry has a potential of about 10 times increase with the attention and due support of the concerned authorities.

The forum was arranged by the Engineering Development Board (EDB) which organised a one day workshop to discuss the problems being faced by Pakistan engineering industry, its present position, its potential and preparation of a national strategy for developing and achieving its export potential. The workshop was attended by about 150 major stakeholders from engineering sector, economist and representatives of public sector. They agreed that engineering sector was in a bad shape as it had been long neglected by the government which paid all its attention to the textile sector. They urged the government to develop engineering sector and proposed setting up EXIM (Export-Import) bank, business support centre, laboratories and industry specific training institutions.

Speaking on the occasion, Razzak Dawood Chairman DESCON and a leading industrialist said that for the last 60 years the economy has been relying on textile based industry which is entirely dependent on nature. "If we want to lead Pakistan to $70 billion export target, our textile would not take us to that level. The government should focus on development of engineering chemicals and information technology sectors".

Governor Kyber Paktunkhwa, Awais Ahmad Ghani, the chief guest said that the government should focus on developing the engineering sector to attain full potential of the sector and raise it as an engine of economic revival.

Minister for Industries and Production Mir Hazar Khan Bijarani underlined the critical role of the engineering industry in the country's economy and its backward and forward high linkages and high-multiple effects and creation of quality jobs for educational workforce. He assured that henceforth the government will give this sector its due attention. It would give more priority in providing training for increasing manpower needs, besides bringing structural changes in policies, institutions and overall environment to facilitate the engineering industry to play its due role in the national development.

Despite all handicaps, however, Pakistan's engineering sector has proven to be robust and dynamic and has not only sustained itself but shown reasonable growth so far. During the last 5 years, besides meeting the internal demand volume of exports has also increased from $639 million in 2004-05 to $812 million in 2008-09.

Pakistan inherited a negligible engineering base comprising small workshops producing diesel engines, lathe machines and crushers. Only Mughalpura workshop in Lahore produced railway machinery. By now it has made significant progress and now it is producing tractors, motorcycles, electric transformers, air-conditioners, refrigerators, sewing machines, cars, trucks and even small vessel. However, full potential of this industry remains untapped because of lack of right type of raw material and precision needed for the manufacturing parts of machinery and above all lack of financial and other supports from the government.

The previous government led by General Musharraf did give an engineering vision 2010, which promised all the needed support to this industry to focus on areas of great export potential like surgical instruments auto parts, ceramics, dyes, electrical goods and even small vessels, but regrettably proved to be paper plan only as nothing worthwhile has been done since then for the development of this sector.

Now the government has come out with a new plan of action "National Engineering Exports Development Strategy" which was thoroughly discussed and approved for harnessing the potential of this industry. The working plan prepared by the Engineering Development Board which was discussed by experts and stakeholders in the one day workshop aims at to achieve the export target of $1040 million from present only about $900 million.