PAK BUSINESSMEN SHOULD USE ORGANIZED RETAIL ROUTE IN INDIA TO MARKET PRODUCTS – PHD CHAMBER

India should promote Pakistan manufactured foods, confectioneries and other fast moving consumer items (FMCG) across the country not only for enhancing the exports of Pakistan into India but also to promote people-to-people contacts and strengthen cultural affinities, according to PHD Chamber.

“It augurs well that Pakistan’s famous food brand – National Foods – has launched their products in India. Such efforts routed through the fast expanding organized retail chains here would help Pakistan penetrate into the length and breadth of the country, where there could be steady demand for culinary creations of Pakistan. This could also be an effective step for cutting down the trade through unofficial channels and to help the bi-lateral trade gain some critical mass, “ says Mr Sanjay Bhatia, President, PHD Chamber.

The PHD Chamber has identified a number of areas where the Pakistan businessmen have to work for penetrating into the continental size market of India. These include adherence to Indian standards and quality benchmarks. Food products that have to be sold through the organized retail outlets have to satisfy stringent quality standards. “We are constantly espousing the need for adhering to these standards at our regular interfaces with Pak businessmen,” says Mr Bhatia.

There are many agricultural items where there is great potential for promoting bilateral trade. Pakistan exported nuts, fresh or fried, betel, tobacco, areca nut, fresh fish, natural honey, etc. worth US$ 19 million (during 2004-05) to the rest of the world. At the same time, India imported from the rest of the world such good worth over US$ 25 million during the same period. “It is easy to dovetail each other’s market demand and save on the transaction costs incurred while exporting to far off destinations,” says Mr Bhatia.

Pitching for enhancing the intra-SAARC trade, PHD Chamber said that radical ideas and action plans should be drawn up for pushing up the trade volumes. One such step could be trading in local currencies. For instance, each SAARC country should be allowed by its Central Bank to build separate reserves in the currencies of others. That would mean that a contracting party to the SAARC should have currency reserves in eight different currency denominations. Trade transactions between two countries could be in their respective currencies. Also, limited convertibility on trade account should be allowed among the countries. That would mean that India could buy Sri Lankan or Pak rupees from Nepal, if that country has surplus currencies of these countries.

Mr Bhatia opined that enhanced India-Pak trade relations can trigger a slew of changes in the sub-continent’s trade and industrial landscape. There are vast untapped trade and investment possibilities between the two countries, which can be exploited for the common good of the region. A cross-country business model for textiles can be envisaged that can lead to the region capturing increased market share in the world textile trade. For instance, for a textile plant to be set up in Pakistan, raw materials, intermediates and fabrics could be manufactured in different countries depending on their natural advantages. Raw materials like cotton yarn, etc. can be sourced from India, fabrics from Bangladesh and Sri Lanka, dyes from Nepal for the manufacture of final products in Pakistan. Similarly, a cement plant can be set up in Easter part of India, which can run on gas imported from Bangladesh.