INTERVIEW WITH TARIQ M. CHAUDHRY, FORMER CHAIRMAN PIFFA

(feedback@pgeconomist.com)
Dec 27, 2010 - Jan 2, 20
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PAGE: TELL US SOMETHING ABOUT YOURSELF?

TARIQ CHAUDHRY: I graduated from Punjab University in 1985 after successful completion of MPA and joined Air France Cargo in Sialkot as Station Manager. After one and half year service, I started my own business in 1987 and finally set the foundation of Dynamic Shipping in 1999 as a Private Limited Company. I am the founder member of Pakistan International Freight Forwarders Association, the first ever independent body of International Freight Forwarders in Pakistan. I was elected as Vice Chairman and then the Chairman of PIFFA and served the industry with devotion and dedication. During these tenures with PIFFA, I had the opportunity of being closely associated with all stakeholders, which include but are not limited to the port authorities, FBR, SBP, trade associations for the streamlining freight forwarding sector in Pakistan.

Masters in Public Administration from University of the Punjab, Lahore
Associated with Freight Forwarding business since 1985, from Sialkot

Moved to Karachi for better business opportunities in 1991 & established Dynamic Shipping in 1995. Continued to work on corporate sector-line in this industry and succeeded in establishing Dynamic Shipping Agencies (Pvt.) Ltd. in 1999 and expanded it's operations worldwide. Had been elected as Director of PIFFC - Pakistan Intl Freight Forwarders Council of FPCCI in the tenure of 2003. Founder member of PIFFA and had been elected as Vice Chairman of PIFFA in 2005-2007.

Unanimously elected unopposed Chairman of PIFFA for 2009-2010.

PAGE: HOW WOULD YOU DESCRIBE YEAR 2010 IN TERMS OF BUSINESS IN PAKISTAN?

TARIQ CHAUDHRY: The year 2010 was challenging in terms of business and penetration to international market. Pakistan was facing tremendous energy problem, which brought adverse impact on the business. We have been facing pressures to boost our existing economy and to attract foreign investments during the year of 2010. The terrorism factor was also hampering the new investors to go for new projects. Due to unrest, international as well as domestic business community was hesitant to enhance the existing business, hence the business conditions were more difficult than 2009.

PAGE: WHAT ARE YOUR VIEWS ABOUT SHIPPING SECTOR IN PAKISTAN?

TARIQ CHAUDHRY: Pakistan is a very strategic country in shipping sector and is known to be land of opportunities. We have all the means for multimodal transportation. We have the Afghan corridor to reach the CIS countries for trading. Since we have many power projects local train service called mass transit pending in the pipeline, therefore we can see lot of scope in shipping sector. There is ample room to establish Container Freight Stations (CFS), Container Terminals and Cargo Villages for the handling of Airfreight at major cities of Pakistan such as KHI/LHE/ISB/SKT/FSD.

PAGE: HOW WOULD YOU COMPARE SHIPPING AND FREIGHT FORWARDING SERVICES OF OUR NEIGHBORING COUNTRIES WITH PAKISTAN?

TARIQ CHAUDHRY: Due to our poor policies, our business is diverted to neighboring countries: China, India, Bangladesh, and Sri Lanka. We were very strong in terms of textile commodity, but due to improper planning and political blame game, our business was diverted and our neighbors have become stronger. Bangladesh has given subsidy on power, labor is also very competitive, and the bank's markups are much lower than Pakistan.

PAGE: WHAT STEPS, IN YOUR OPINION, HAVE BEEN TAKEN SO FAR BY PAKISTAN TO PROMOTE SHIPPING AND FREIGHT FORWARDING SECTORS?

TARIQ CHAUDHRY: Nothing. So far these sectors have been neglected, however it is suggested that we should be declared an industry. Other countries of our continent are spending a lot to promote this industry through exhibitions, conferences, seminars etc.

PAGE: HOW DID SHIPPING AND FREIGHT FORWARDING SECTORS PERFORM IN PAKISTAN DURING 2010?

TARIQ CHAUDHRY: The trade volume of 47 million tons in 2005 in Pakistan will rise to 75 million by 2010. The unique geographical location of Pakistan offers tremendous opportunities for the freight-forwarders as well as poses serious challenge for service providers to tap the emerging opportunities. It requires both capital and the policy framework. In order to create internationally compatible rules and commercial capabilities, PIFFA has been created in 2005 to provide an efficient platform for all stakeholders to cope up the global challenges. Despite developing physical infrastructure for cargo movement through port container terminals, expansion of inland dry-ports, bulk and oil terminals, improved road infrastructures, new airports etc; the policy based procedures have remained unattended over the last decade. This needs to be attached high priority through framing rules for carriage of goods by road, sea, and air to ensure proper facilitation. There are different ministries working on it like commerce, finance, industry, ports and shipping, communication to name few. Another common element in different modes of cargo movement is FBR, which regulates the activities of different stakeholders by imposing taxes and duties etc. PIFFA has taken up the issue of shortage of trucks in the industry with all stakeholders particularly the government. With the improved delivery and handling facilities at ports, the free time at port has been reduced from 10 to 5-days and will eventually be brought to 3-days. It will require the enhanced quality services in the form of warehousing by the freight forwarders. The future challenges include the negotiations with various government agencies like Federal Board of Revenue, State Bank of Pakistan etc. to sort out the outstanding issues being faced by the freight-forwarding sector.

We also want uniformity in rules for all modes of freight management like air, sea, and road. All the airlines sell their cargo space through IATA approved agents. The same practice needs to be followed in sea mode as now we have the PIFFA as a national body in operation to manage the affairs of this sector. Need is to recognise the importance of this sector by granting it concessional loans like export re-finance by the banks for the development of infrastructure of freight forwarding industry as per prevalent global practices to make it more vibrant and profit-oriented venture.

Let me recount the salient achievements under the banner of PIFFA. The top most being declaration of freight forwarding sector as "industry" and then the approval of standard trading conditions, code of conduct and minimum requirement for qualification as PIFFA member. Our association is duly accepted and registered as sole representative trade body of this sector. We are proud to claim that membership of this body is mandatory to operate as recognized freight forwarder.

To broaden the base of this sector, a statistical survey is in process by the Federal Bureau of Statistics to ascertain the strength of the freight-forwarding sector and to prove its effectiveness and contribution to the national economy.

In order to produce quality services by the freight forwarding sector, PIFFA has been involved to train the human resource in collaboration of FIATA (which is an internationally recognized association of freight forwarders with headquarters at Switzerland). The association has launched PIFFA-FIATA Diploma Course and delivering quality education and training compatible to the worldwide best practices for the managers and operators of this industry in Pakistan.

To inculcate uniform practices and bring discipline in the freight forwarding industry, PIFFA is developing self-regulation mechanism through ministry of commerce to give this industry a "reliable partner-status" with other stakeholders.

To put our own house in order, we plan to introduce the following measures through PIFFA platform for the freight forwarding industry:

Re-Organization of PIFFA Secretariat by hiring people with relevant experience of this industry.

Establishment of Research & Development Division in PIFFA.

Obtaining of the ISO Certification for PIFFA Secretariat.

Establishment of PIFFA own building with the help of members' support and government's backing.

Streamlining the procedures of Afghan-Transit Trade

We are not limited to the achievement of these goals only but would continue to expand the ambit of our activities as per needs of the trade.

For future development in this sector, we would urge the government authorities to establish a separate ministry of logistics & transport at federal level in order to streamline this vital sector of economy to move at a faster pace with the global demands. There is no proper forum at government level to sort out all the issues facing this sector and we have to negotiate with different ministries to get our genuine problems resolved. The following demands should be dealt on priority:

DECLARATION OF PAKISTAN AS TRANSSHIPMENT PORT

Allowing the public-sector organisations to route their shipments through private sector freight forwarders instead of current practice of routing their cargo by PNSC & PIA.

Establishment of PIFFA Custom-Bonded CFS Terminal