By Rida Zeenat
Tuesday, July 19th, 2011
Pakistan is a state which is highly committed to adopt efficient export control guidelines, policies and procedures. It aspires to increase trade with other countries keeping in mind to mitigate uncertainties of exporters. Pakistan is determined to pursue its effective export control under various international instruments and it controls and monitors all exports that can contribute to the proliferation of weapons of mass destruction. Pakistan is a responsible state and being a signatory to a large number of international treaties on non-proliferation it is committed to fulfill its international obligations
International agreements are instruments to limit trade of certain types of goods and information that may add into terrorism and proliferation of weapons of mass destruction. Moreover they also have effective mechanism to make sure that the states abide by to what they have agreed to while signing the treaty.
Pakistan has signed a number of international agreement and conventions like Nuclear Safety Convention of 1994, Early Notification in case of a Nuclear Accident, Assistance in case of Nuclear or Radiological Accident, Convention on Physical Protection of Nuclear Material (CPPNM), Biological and Toxins Weapons Convention (BTWC) in 1972 and ratified it in 1974, Chemical Weapons Convention (CWC) in 1993 and ratified it in 1997 and is a member of Organization for the Prohibition of Chemical Weapons (OPCW) in good standing.
Following this, in October 2000, the government promulgated a law to prohibit the development, production, and use of chemical weapons. The laws were made in pursuance of the Chemical Weapon Convention, which Pakistan ratified in 1997.1 In 2008, Pakistan was re-elected to the Organization for the Prohibition of Chemical Weapons (OPCW)’s Executive Council, a seat which it has continuously held since 1999.2
Pakistan also has domestic strict export control procedures to keep a check on trade. The Trade Development Authority of Pakistan (TDAP) is a regulatory body in Pakistan, formerly known as Export Promotion Bureau (EPB) which is an apex agency of the Government affianced in promotion, augmentation and development of exports.
Trade Development Authority of Pakistan (TDAP) is dedicated for promotion of goods and services being exported. The administrative ministry of Trade Development Authority of Pakistan (TDAP) is the Ministry of Commerce.3
Its main objective is to explore new market and to introduce Pakistan made products in international markets. And it does so by promoting exporters to participate in exhibitions abroad and also collaborates with international delegates coming to Pakistan for the enhancement of Pakistan market and sends delegates abroad to explore new markets.
It is working towards the development of trade policies which would improve conditions of Pakistan market which will ultimately contribute into the international economy.
Its role in Textile quota management is especially significant. More than 20,000 exporters have been facilitated to exhibit their exports. This strategy differentiated between strategic thrusts, directly impacting achievement of Volume and Value in export and concentrated on areas which could create an environment for the private sector to realize their aspirations.
Pakistan’s market for industrial chemicals is expanding gradually though it has a less-well developed commercial chemical industry than India. As was stated in the Pakistan trade policy 2010, “In order to address our strategic objective of product diversification for Pakistan’s exports our government aims to provide a clear policy framework on the development of chemical sector.”4
Chemical industry in Pakistan is widespread, in organized & unorganized sector. It has approximation of investment in chemical sectors between Rs.550-600 billion. The chemical related imports constitute about 17% of the total import bill.5
Pakistan has a well organized system for imports and exports of chemical materials which are then converted into more than 70,000 various products, for industry as well as the goods of consumers that people depend on in their daily life.6 But unfortunately the imports are much higher than the exports. Pakistan needs to enhance its chemical exports which would really help in the growth of Pakistan’s economy. If not then it must not rely on the imports and must adopt the policy of self reliance on its own resources.
Below is the chart which depicts the difference between the imports and exports of the chemical material, in which it is clear that the difference is large.
According to the Chemical Industry Vision – 2030 the chemical industry in Pakistan has been classified into two categories which are as follows:
1. The Primary Chemical Industry: Primary chemical industries are refineries, petrochemicals, natural gas, metallurgical and mineral based projects. They also provide feedstock for the secondary chemical industry.
2. The Secondary Chemical Industry: Secondary chemical industries are based on feedstock either derived from primary industries or other alternative sources of raw material like coal, limestone, gypsum, rock salt, silica and sulphur.
The principal objective of Secondary sector industries is to maintain connectivity between products and materials produced by the Primary industries and are of practical use for the national economy. The chemical industry comprises of companies that produce industrial chemicals which are important for the economy, as it converts raw material into more than 70,000 different products.
This implies that the secondary industries rely on the primary industries for feedstock and raw material to be used in manufacturing, processing, blending, fabricating plants for petrochemical intermediates, polymers, plastics, steel, non-ferrous metals, minerals, agricultural and other miscellaneous products.
These industries use medium- to highly sophisticated technology and have a range from light to medium categories. The chemical industry is more varied than any other industry because its products are universal.
Chemicals are important as they play the role of a building block to produce products in order to fulfill the basic needs like, shelter, food and health.8 They also are central to the world of technology, telecommunications and ofcource biotechnology. These are used to make a large variety of consumer goods and have inputs in agriculture, manufacturing, construction and services industries.
Chemicals in particular, are a keystone of world manufacturing, as they are an integral component of all the manufacturing sub-sectors, including pharmaceuticals, automobiles, textiles, furniture, electronics, construction and appliances.9
Economically the market of chemicals is divided into four main categories.
- Basic Chemicals which are the commodity materials including flexible material, Polymers, Petrochemicals and other derivatives and inorganic chemicals which makes.10 35-37% of the chemical market.
- Life Sciences Include differentiated chemical and biological substances, pharmaceuticals, health products, and crop protection chemicals makes 30% of the chemical market.
- Specialty Chemicals These are high value-added chemicals with diverse end-product market. Products include electronic chemicals, industrial gases, adhesives, sealants and catalysts. Specialty Chemicals are sometimes referred to as “fine chemicals” make 11 20-25% of the chemical market.
- Consumer Products include soap, detergents, and cosmetics are only 10% of the chemical market.
Chemical industry in Pakistan is widespread. The chemical imports constitute about 17% of the total import bill. Pakistan has made considerable progress in basic inorganic chemicals like Soda Ash, Caustic Soda, Sulphuric Acid and Chlorine and has acquired sufficient production capacity of these chemicals to cater for the needs of the local industry, while surplus is being exported. 12
Even then there are some challenges to be countered. The chemical industry of Pakistan is lagging behind due to some challenges. The main challenge is that it has to rely on its imports and foreign materials. It does not benefit the economy and results in production of expensive products.
Secondly lack of industrial infrastructure and technology in Pakistan results in low quality products which do not mark the standard. Moreover the discriminatory approach of international community does not integrate the Pakistan market into the international economy and Pakistani products are not given access to the international market. Moreover the lack of resources and weak trade policies of the ministries also result in the weakening of chemical industry.
In order to enhance the chemical industry Pakistan must adopt the policy of “self-reliance”. Instead of relying on foreign designs and engineering it must improve its own production and ensure high quality of chemical products.
Pakistan must work towards integrated approach. It must bring four worlds of a society together which are traders, universities, research and development and production partners. This will bring innovation and must utilize its youth which has fresh minds and great ideas to enhance the chemical industry resulting in qualitative and quantitative perfection in the chemical products.
Pakistan is capable of producing high technological products all it needs is a little bit of effort in improvement of administrative capabilities and induction of new technology and support from government to put things in order.
1. Pakistan promulgates law against chemical weapons,” Deutsche Presse-Agentur, 11 October 2000; in Lexis-Nexis Academic Universe, 11 October 2000, www.lexis-nexis.com.
2. “The Executive Council,” OPCW website, www.opcw.org.
3. TDAP. http://www.tdap.gov.pk/about.php
4. Trade Policy 2010 speech by Makhdoom Amin Fahim minister for commerce 27th july, 2009 government of pakistan ministry of commerce Islamabad. http://www.tdap.gov.pk/pdf/trade_policy_speech_2009-10.pdf
5. Chemical Industry Vision -2030 final report retrieved from http://www.engineeringpakistan.com/ChemicalVision.pdf
6. “Chemical sector in Pakistan”. Economic review, Jan 2011. retrieved from http://findarticles.com/p/articles/mi_hb092/is_1_42/ai_n57155563/
7. Chemical Industry Vision -2030 final report retrieved from http://www.engineeringpakistan.com/ChemicalVision.pdf
8. “Industry: facts, Discussion forum, and Encyclopedia article”, retrieved from http://www.absoluteastronomy.com/topics/industry
9. “Prospects of chemical industry in Pakistan”, Experts Advisory cell, 2003 retrieved from http://www.findpk.com/Publications/ProspectsofchemicalIndustryinPakistan/index6.html
10. Michael McCoy, et al., “Facts and Figures of the Chemical Industry”, Chemical & Engineering News, 84(29), July 10, 2006.
11. Alfred D. Chandler. Shaping the Industrial Century: The Remarkable Story of the Evolution of the Modern Chemical and Pharmaceutical Industries. Harvard University Press, 2005.
12. “Prospects of chemical industry in Pakistan”, Experts Advisory cell, 2003 retrieved from http://www.findpk.com/Publications/ProspectsofchemicalIndustryinPakistan/index6.html