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Third international seminar on engineering goods industry.

Third International Seminar on Engineering Goods Industry

The Special Technical Cell of the Ministry of Production Government of Pakistan organised it with objectives: 1. To discuss the environment,

capabalities, constraints and opportunities

whithin the Engineering Industry. 2. To highlight Government policies and

bring out factors hampering desired

growth. 3. To highlight the obstacles to growth,

focusing on Government fiscal a n d

industrial policies, change in the Role

of financial institutions and

acceleration of the process of Technology

Transfer.

About 200 engineers, planners, industrialists and financial experts participated in it. Ex-Federal Minister of State for Production, Raja Shahid Zafar inaugurated the Seminar. The Minister said that most of the public sector industries are being managed by the Ministry of Production and the Special Technical Cell is responsible at national level to coordinate indigenisation of machinery and equipment through public and private organizations. Some of the industrial units have made tangible progress. For instance, the Millat Tractors has achieved 80 per cent deletion and has made exports. The Pak Suzuki Motor Co. has achieved 36 per cent deletion while in trucks and buses about 30 per cent. In Heavy Mechanical Complex complete sugar, cement and other industrial plants are being manufactured. The Ministry of Production has achieved some tangible results under the present Government. A Pakistani truck for defence and civil use has been produced, Zulfiqar Ali Bhutto Textile Mills has been recommissioned, Shahnawaz Sugar Mills has been modernized and the People's Steel Mill has been partially recommissioned.

Some of the industrial units have either increased their profits or have earned profits for the first time. In short, improvements have been made in productivity, and profits in most of the units. New projects are also being launched and some are being expanded. Welcome address was read by the Secretary Ministry of Production in which he said that Ministry of Production was making utmost efforts to achieve the objectives assigned to it by the elected Government. Ministry has also been directed by the Prime Minister to accelerate the task of indigenization of foreign machinery and equipment and the Special Technical Cell is doing it. The Ministry is doing all that it can do despite shortage of talent in various engineering disciplines.

Dr. Muhammad Akram Sheikh, Chief Executive, Special Technical Cell read the keynote address. He highlighted the role of engineering industry which helped the growth of each economic activity. This industry is a symbol of self-reliance. Then he narrated the history of engineering industry since 1947. At that time, the size of the engineering industry was small. Now, it is well developed. Registered units are about 2000 in addition to a large number of unregistered ones. Direct employment is over 200,000 workers and 10 per cent of value added from manufacturing and 1 per cent of GDP comes from it. However, there are problems like lack of modern equipment, qualified engineers, and designers, quality control systems and techniques. Most of the units suffer from inefficient operational practices, out-moded equipment, and lack of R&D, Non-availability of quality products, import restrictions and high tariffs have encouraged unfair practices.

In 1981-82, Rs. 16.8 billion worth of engineering goods were imported and Rs. 12 billion worth were produced locally. In Sixth Plan, target for 1987-88 was Rs. 33.9 billion in total supply of Rs. 56.6 billion. Investment in engineering industry was Rs. 19.93 billion, only 6.6 per cent more than the 5th Plan. For public sector Rs. 9.06 billion were to be invested in engineering goods but actual investment was Rs. 2.424 billion or 7 per cent of Rs. 35 billion investment sanctioned for industrial sector. Production of engineering goods in 1987-88 was Rs. 21 billion and imports 39.8 billion.

For 7th Plan, total investment is envisaged at Rs. 23.1 billion - Rs. 1.1 billion in public sector and Rs. 22 billion in private sector - or 16 per cent more than 6th Plan. In July 1989 - March 1990 period total industrial sanctions were Rs. 60 billion but the share of engineering industry was low, only Rs. 1.84 billion. Also imports of engineering goods were at Rs. 49.4 billion, or 24 per cent more than 1987-88. During 1989-90 imports were anticipated at Rs. 54 billion. In 1988-89, total exports were Rs. 91 billion and imports Rs. 136 billion and imports of engineering goods were 36 per cent of total imports and 54 per cent of exports. Exports of engineering goods are also discouraging, Rs. 704 million in 1981-82, Rs. 1236 million in 1986-87, Rs. 532 million in 1987-88 and Rs. 520 million in 1988-89. The industry is faced with problems of high cost of inputs, and energy and high overhead charges due to low capacity utilization. Some Government policies are encouraging but much more remains to be done. In the end the speaker made some suggestions.

M/s. Stuart T. Jenkins and Ian J. Willcox read a paper on Mini Steel Mills in Pakistan - Concept and Feasibility. Initially, they described the position of steel industry in Pakistan. It was followed by the concept and history of the Mini-Mill since 1950's in Italy which developed due to (i) abundant availability of cheap scrap due to war, (ii) availability of cheap power, (iii) large scale demand reinforcing rod and bar for reconstruction purposes, (iv) low requirement of investment capital, and (v) simple technology needed in mini-mills. They have recommended for the establishment of mini-steel mills in northern part of Pakistan to meet local demand and for reconstruction works in Afghanistan and Iran.

Dr. A. Qidwai, Chairman State Engineering Corporation read a paper on Heavy Engineering Industry - Its role and status. As history of the industry there were two important engineering units in 1947 B.E.C.O. in private sector and Mughalpura Railway workshop in public sector. Later light engineering units were set up to produce diesel engines, pumps, farm implements, cold storage and ice plants, flour and rice mills, textile mill machinery, etc. Public sector appeared on the scene to set up heavy engineering units. According to a World Bank Survey, the output of engineering goods in 1985-86 was Rs. 33.385 billion including Rs. 3.265 billion of capital goods. Value added was 30 per cent. Local output was 30 per cent of the demand for capital goods estimated at Rs. 13.602 billion. Present demand for engineering goods is Rs. 70 billion a year, of which 35 per cent is met locally.

Dr. Idrees Anwar Director National Institute of Electronics Islamabad, in his paper "Electronic Industries _ Potential and Investment in the 1990s, said that very little has been done in Pakistan to develop electronics industry as compared to India or Thailand. In India, the growth rate of this industry in 1989 was 35 per cent, production increased to Rs. 90 billion, computer software export of Rs. 1.3 billion and hardware export of Rs. 800 million. Exports of Thailand are estimated at $1.6 billion worth of electronics products.

In Pakistan, except a few units, very few manufacturers have designs of their own. Cottage scale producers still depend on imported kits and copied designs. A large number of small scale and large scale producers are anxious to initiate local production but environment here is not favourable. High tariffs on mechanical parts and other electronic materials, procedural problems and lack of necessary facilities for design, and technical, financial and commercial services and lack of infrastructure are the main hurdles. Some suggestions have been made to remove these hurdles.

Mr. Yusuf H. Shirazi, in his paper "Data To Develop Engineering Industry" stated that the engineering industry provides high added value; it is an instrument to development other industries; a diversified engineering industry is a basis for self-reliance and to support defence efforts. For its systematic and rapid development, there are some pre-conditions. These are research and development with proper methodology, mass education with proper lines, need for proper incentives, and the comprehensive data bank. To these may be added the use of imported technology.

Dr. Junaid Ahmad, in his paper "Automotive Industry - Path to Self-Reliance", said that the localization/indigenization programme of the automobile has not moved forward over the last 43 years. The growth has been slow due to lack of clear policy, non-standardization of makes/models, low taxes and duties on imported CKD Packs, lack of assistance from foreign investors to promote local manufacture of parts and components, improper implementation of the deletion programme, under invoicing, smuggling and other malpractices.

In recent years, economic growth the rate in Pakistan has been 6 to 8 per cent a year, and the growth rate of transport sector should be twice of that. This growth rate should be continued to maintain the economic growth rate. At present, Pakistan's imports of automotive vehicles, agricultural tractors and allied spare parts cost $ 500 million a year. By 2000 AD, these may go upto $1.5 billion. To avoid or reduce it, the automotive industry should be developed on healthy lines.

The automobile industry have several advantages. It helps overall industrialization, and basic infrastructure is provided for farm machinery and defense equipment. Other allied industries such as metal working fibre glass, wire and cable, electrical components, paints, plastics, rubber, synthetics, textiles and glass are encouraged. If direct employment in automobile industry is 100, about 900 workers find jobs in other industries. History of development of this industry is narrated. At the end suggestions are given Dr. Qamar lqbal, Chairman, PCSIR, in his paper "Technology Development and Appropriation through R&D - Experience of PCSIR" inter-alia stated the present position of PCSIR and its contribution to the national economy. The Council has set up nine laboratories and training centres in the country where the number of working scientists is about 800 including 150 PhDs. PCSIR's contribution to national economy is given below: 1. About 600 industrial processes have

been developed out of which 300 are

innovations and have been duly

patented. Some 350 processes have

been leased out to industry for

commercial exploitation. 2. About 3,000 research papers have

been published. 3. Several thousand tests and

feasibilities have been completed on

reference from the industry. 4. A scientific journal of international

standard, "Pakistan Journal of

Scientific and Industrial Research" is being

published for the last 35 years.

Prof. Dr. M. Ashraf Chughtai, Head Department of Electrical Engineering and Technology Lahore, in his paper "Role of Computers in Engineering Industry" said that the computer aided design and manufacturing (CAD/CAM) technology has an important impact in the development of engineering industry. New tools and sophisticated software have been designed to improve the managerial skills and productivity in every field of life in general and in industry, in particular. Expert and artificial intelligent systems have been involved which provide knowledge-based man-machine communication for industrial design and process control operations. The hierarchy of CAD/CAM technology is described to explain the impact of computer in engineering industry.
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Title Annotation:Seminar
Author:MajidKhan, Abdul
Publication:Economic Review
Date:Aug 1, 1990
Words:1823
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