Pak entrepreneurs hint at investing 3.0b

[ARKhan]

Pak entrepreneurs hint at investing $3.0b in textile, clothing industry
Govinda Shil
11/20/2005


Pakistani entrepreneurs pledged Saturday to exploit preferential trading benefits that Bangladesh is enjoying in developed markets by investing billions of dollars in the country's vibrant textile and clothing industry.
A group of 10 top leaders of Pakistani textile and bed wear exporters are now visiting Bangladesh and is expected to form a business council and develop action plan to go for joint venture projects and direct foreign investment.
Pakistan grows quality cotton and Bangladesh has abundant labour force available at 'most competitive wages' and that both the countries could play complimentary roles in maximising their textile and clothing business.
The visiting entrepreneurs said that the Asian countries, such as India, China, Bangladesh and Pakistan together form the largest consumer market on the earth and the nations must raise intra-regional trade to sustain in the stiff global competition, after quota on textile and clothing had disappeared early this year.
They said it was miserable that the SAARC countries' trade is only 5.0 per cent among themselves as against 65 per cent done by EU members.
"We are serious about making investment in Bangladesh. A three billion dollar seems to me as a moderate investment. We are ready to invest substantially here," said Shabir Ahmed, Chairman of Pakistan Bed-wear Exporters Association, in an interview with the Financial Express, Saturday.
Ahmed said Bangladesh's export to Pakistan stands at only US $ 60 million while Pakistan exports some US $ 225 million worth of products, mainly fabrics and yarn and cotton to Bangladesh.
Pakistan's bed-wear industry fetches US $ 1.30 billion in export revenue and had developed reputation in Europe and American markets. But its growth has been marred because of various anti-dumping measures and relatively high duty structures in the developed markets. For example, the bed wear industry, if set up in Bangladesh, could save 24 per cent expenses (in dollar terms) than that of Pakistani ones, estimated MA Matin, former BTMA president.
The Pakistani delegates enquired about port, bank interest, power and gas expenses and labour costs and labour laws and are scheduled to meet commerce and industry ministers, Board of Investment executive chairman, and foreign minister, during their four-day trip.
They will also take part in a dialogue on "Opportunity of Investment in Bangladesh's Textile Sector," to be held at Hotel Sonargaon today (Sunday).
"We have developed pretty nice marketing strategy in Europe and America. It will be a win-win situation for Bangladesh and Pakistan if we get united…" Shabir said.
Former BTMA chairman said Bangladesh enjoys tremendous potentialities in textile and clothing sector. He said from nowhere, this country has established some 4.5 million spindles in just a few years and the growth rate is very high.
He argued that Bangladesh's textile sector enjoys comparative advantage because of expanding market and consistent rate of growth. "Although we do not have cotton, but we have set up 4.5 million spindles and around 200,000 to 300,000 spindles would come under operation soon, " Matin said.
He said Bangladesh exported bed linen to EU market worth about 98 million Euros last year, showing a fabulous 100 per cent growth.
The Pakistani delegates asked if Bangladesh and Pakistan could jointly urge the EU to design a common Rules of Origin (ROO) and Generalised System of Preference (GSP) strategy, but Bangladesh said it wants to enjoy the Least Developed Country (LDC) status and still wants Pakistan to invest in Bangladesh to tap the duty-free, quota free benefits.
BTMA vice chairman Jahangir Alamin welcomed the Pakistani delegation and organised tête-à-tête between Bangladeshi and Pakistani entrepreneurs in the evening.
"We can tell you our power is the cheapest in the world…if you use gas-burn generators," declared Alamin who argued there were many others factors of production, which are much cheaper in Bangladesh.
"You (Pakistan) are facing some odds in the EU market, and, that is why, Bangladesh is the best place for you to invest," Alamin, the vice chairman, said.
A leading textile manufacturer in Bangladesh, Abdullah Al Mahmud, said, woven sub-sector is almost untouched in Bangladesh and that Pakistan could tap the potentialities here. He said Bangladesh produces fraction of total woven fabrics demand.
Bangladesh fetches more than US $ 6 billion in apparel exports and that the country has been experiencing a moderate of 23 per cent growth.
A leading Pakistani textile manufacturer, Bashir Ali Mohammad, said, Bangladesh should reach transport agreement with India so that a truckload of fabrics or yarn could come to Bangladesh only in four days from Karachi or Lahore.
As China and the USA developed strains on clothing business, the American buyers now got crazy to look for alternative countries for their apparel-sourcing, said Alamin, the BTMA vice chairman.

http://www.financialexpress-bd.com/index3....id=7355&spcl=no

 

[SMC]

Err shouldn't they be investing in their own country rather than a different country..?

 

[VisionHawk]

Pakistan has a huge textile industry do u know that Pak is the biggest either exporter or producer of cotton i am not sure but i will try to confirm it so i think its a good step :BVICTORY: akistanFlag:

 

[ARKhan]

Business is more profitable in Bangladesh and since we have better access and chance to export in other countries the all investors are interested in Bangladesh not just Pakistanis. The Saudi's, UAE, South Koreans, Japanese, Chinese, Dutch, British, Malaysian, Egyptian, Jordanian, American and Indian firms are lining invest it telecom, IT, roads & infrastructure, tourism, industry, engineering, textiles, garments, cement, energy and fertiliser.

Bangladesh's economic performance is strong. Sri Lanka tops South Asia followed by India then Bangladesh and after that Pakistan.

But for doing business Bangladesh is the best. We are comprehending to invest in Bangladesh in the IT, telecom, construction and fast food industries.

 

[Srirangan]

Originally posted by bdmilitary@Nov 23 2005, 03:19 PM
Business is more profitable in Bangladesh and since we have better access and chance to export in other countries the all investors are interested in Bangladesh not just Pakistanis. The Saudi's, UAE, South Koreans, Japanese, Chinese, Dutch, British, Malaysian, Egyptian, Jordanian, American and Indian firms are lining invest it telecom, IT, roads & infrastructure, tourism, industry, engineering, textiles, garments, cement, energy and fertiliser.

Bangladesh's economic performance is strong. Sri Lanka tops South Asia followed by India then Bangladesh and after that Pakistan.

But for doing business Bangladesh is the best. We are comprehending to invest in Bangladesh in the IT, telecom, construction and fast food industries.

[post=3513]Quoted post[/post]​

Pakistan has as good a chance in exports to foreign countries as Bangladesh. Infact I don't see any credible advantages Bangladeshi textiles has vis-a-vis Pakistani textile industry.

FYI Pakistani economy doesn't follow the "look east" policy that some sectors of Indian and Bangladeshi industries do follow. Pakistan is concerned in exporting textiles to the huge EU and US market.

Now if you have paid attention over the past 3-4 months, there has been a quota imposed on Chinese textile exports to EU and US, I can't speak about Pakistan but the Indian textile industry has seena huge jump in European and American orders because of the Chinese quota, I am sure Pakistan and BD would have seen a rise too.

So when the eventual market is West, why invest in BD's textile industry?

 

[Kaiser]

Originally posted by bdmilitary@Nov 23 2005, 09:49 AM
Business is more profitable in Bangladesh and since we have better access and chance to export in other countries the all investors are interested in Bangladesh not just Pakistanis. The Saudi's, UAE, South Koreans, Japanese, Chinese, Dutch, British, Malaysian, Egyptian, Jordanian, American and Indian firms are lining invest it telecom, IT, roads & infrastructure, tourism, industry, engineering, textiles, garments, cement, energy and fertiliser.

Bangladesh's economic performance is strong. Sri Lanka tops South Asia followed by India then Bangladesh and after that Pakistan.

But for doing business Bangladesh is the best. We are comprehending to invest in Bangladesh in the IT, telecom, construction and fast food industries.

[post=3513]Quoted post[/post]​

Actually you got it wrong Pakistan ranks number 60 is doing buisness in the world and best in South Asia followed by Bangladesh,Sri Lanka,and lastly India.

http://www.doingbusiness.org/EconomyRankings/

 

[ARKhan]

Originally posted by Kaiser@Nov 25 2005, 02:03 AM
Actually you got it wrong Pakistan ranks number 60 is doing buisness in the world and best in South Asia followed by Bangladesh,Sri Lanka,and lastly India.

[post=3602]Quoted post[/post]​

http://www.doingbusiness.org/EconomyRankings/

Kaiser I am talking about TDI. The latest facts from this month.

Dhaka ranks 3rd in SAARC in TDI
BANGLADESH SANGBAD SANGSTHA, Dhaka

Bangladesh has ranked third in the SAARC region and 93rd among 110 countries of the world in trade and development, according to the new UN trade and development index.
Prepared by the UNCTAD secretariat under the guidance of Nobel Laureate economist Lawrence Klein, the index measures integration of international trade in human development, and is capable of monitoring, benchmarking and ranking the trade and development performances of all countries, a report available here said.
For the first time under UN system, the TDI has been made by using an innovative methodology to link factors affecting a country’s foreign trade and human development.
It is based on a total of 29 distinct indicators ranging from structural and institutional factors to trade process and policy indicators and human development indicators.
This set of indicators also includes the much-discussed perception-based corruption index.
Ranked at 59, Sri Lanka leads the South Asian region. India ranks 90th, followed by Pakistan at number 95, and Nepal at 98. Bhutan and Maldives are not included in the list of countries due to lack of data.
The 2005 TDI ranks Denmark as the world’s most successful trade-and-development nation. Ranking second and third are the USA and the UK.
Other countries in the list of top ten performers include Sweden, Norway, Japan, Switzerland, Germany, Austria and Canada. France is in the 11th place, closely followed by Belgium and Australia.
At number 15, Singapore is the only developing country among the top 20. It is followed by the Republic of Korea at 25, Malaysia at 28 and Uruguay at 33. China, despite its impressive export performance in recent years, is ranked 51st.
Among developing countries, the top-ranking nations include mostly the newly industrialised economies of East and Southeast Asia, and some Latin American and Caribbean countries.
The top-ranking Latin American and Caribbean countries are Uruguay (33rd), the Bahamas (34th), and Costa Rica (35th). Among Arab countries, Kuwait leads in 39th place followed by Jordan, Saudi Arabia, and Egypt.
The 10 lowest-ranked nations are from Africa and include nine least-developed countries (LDCs). South Africa and Mauritius are the only African countries in the top 50, ranked 41st and 47th respectively.

[url=http://www.newagebd.com/2005/nov/12/nat.html]http://www.newagebd.com/2005/nov/12/nat.html

 

[sigatoka]

I think it is brilliant Pakistan is investing in textiles in Bangladesh. The reasons are several.

Bangladesh is an extremely Capital poor nation, much more so than Pakistan and on par with African nations.

Over the last few decades with China integrating into the World economy, the labour supply of the World has gone up by around a third. China has increased the supply of labour by a third but has come with almost no Capital. Therefore returns on Capital have been boosted over the last few decades. (Returns on Capital have increased, One factory now can have 1/3 more workers.)

Because Bangladesh is so capital poor, Pakistani Capital there will earn a higher return than in Pakistan. I happen to believe that is good for Pakistan and Bangladesh.

Bangladesh has no absolute advantage in any sector than Pakistan. Bangladesh does have a comparative advantage in Textiles, This means that Bangladesh is less worse in Textiles compared to Pakistan than other industries. According to Orthodox economic teachings, it makes sense for Bangladesh to concetrate on its least worst aspect and trade for goods and services were it is much worse than others.

Thirdly Pakistan lost Bangladesh in a civil war, this does not mean anything. Europe a continent torn apart by wars in the past still have countries with different names and parliaments with separate armies and yet for Western Europe the economies are as integrated as if there really was no boundries.

Why cant bangladesh and Pakistan have different names, parliaments and standing armies and not have an integrated economy?

This is the challenge of our generation.

 

[Srirangan]

Bangladesh is an extremely Capital poor nation, much more so than Pakistan and on par with African nations.

Economics 101. Pakistan will get better ROI's if invested within Pakistan. Cheap labor advantage that Bangladesh enjoys is over rated. Labor does need to be trained which costs capital none the less.

 

[ARKhan]

Both of you have the wrong idea as you lack any real knowledge about Bangladesh's economic affairs as you make up your minds even before knowing the facts.

*****

Fear of textile unit relocation to Bangladesh grips Pak govt
11/27/2005


KARACHI: Worried by the prospect of relocation of textile units to Bangladesh, the ministry concerned of the government of Pakistan held a meeting with major players Saturday.
Plans for shifting production units to Bangladesh by some of the leading industrialists rang alarm bells in government circles, according to a report published in the Daily Times Friday.
A recent announcement by Bangladesh, which offers a tax-free investment opportunity to the Pakistani textile industry, has attracted some of the prominent textile industrialists, who now plan to shift their production units.
However, the situation has pushed the authorities to offer incentives to the over $8.0 billion-export industry, otherwise it could trigger capital flight from the country.
Syed Masood Alam Rizvi, federal textile secretary, convened the meeting.
"The ministry itself called the meeting to know the concerns and worries of the textile industry as we have noticed some aggressive complaints from bedwear manufacturers and exporters," Rizvi told the Daily Times Thursday.
He said major interest of the textile units, planning to operate from Bangladesh, was to get broader market access, as that country did not face tariff barriers from European countries like Pakistan.
"So the issue is not the production cost, it is the market share, which one can get better while exporting textile goods from Bangladesh compared with Pakistan," said Rizvi.
The Bangladesh government last month offered a tax-free investment environment to the Pakistani textile industry as the country is eyeing $1 billion foreign investment within a year.
The Bangladesh offer did not go unheard as a 10-member delegation of leading bedwear manufacturers and exporters visited Bangladesh in early November and held a series of meetings at the Bangladesh Board of Investment, the ministry of commerce and the ministry of industries.
The Pakistan government seems serious about the issue and has come up with a plan to hear the industrialists and decide the textile export strategy in a bid to avoid major damage.
"We would definitely address the textile industry's concerns," said the federal textile secretary.
"The government really wants to know the problems and issues of the country's most progressive industry, and then it would decide the line of action."
He said the government was already negotiating with the European Union authorities on the generalised system of preference and anti-dumping issue, which could give positive results.
The bedwear exporters witnessed a sharp decline in orders from European countries after the EU in March 2004 imposed a 13.1 per cent anti-dumping duty on imports from Pakistan, claiming the cheap Pakistani products were harming the local textile industries.
Later, it announced that it would readdress the issue and conduct a fresh inquiry, but the matter was not resolved as desired by the local industry and exporters.
"Bedwear exporters are seriously considering moving over to Bangladesh," said a senior bedwear exporter, who recently returned from Bangladesh and asked not to be named.
"Actually, the exporters and manufacturers are really disappointed because the way our government handled the issues of anti-dumping duty with the EU and market access with the US."
He said the failed strategy led to non-tariff barriers from the EU, which had not only imposed anti-dumping duty on bedwear exports but had also withdrawn GSP benefits from Pakistan.
Pakistan, which entered the WTO regime in January 2005, is among top five textile goods exporters of the world. On an average the country exports textile products worth more than $8 billion every year.
Bedwear is one of the five items belonging to a billion-dollar club of the textile groups, including yarn, cloth, knitwear and readymade garments.
Another report published in the Pakistan Times said the leading industrialists of Pakistan have expressed their concern over the deterioration in textile sector. They say that industry is working on negative margins and survival of value added textile industry in particular is at stake due to high cost of production, and exporters are relocating business to Bangladesh.
Pakistan and Bangladesh had great specialty in textile and readymade garments respectively. Bangladesh has offered Pakistani industrialists to join hands in increasing exports in apparel from Bangladesh, which was enjoying quota free access to EU and USA. Bangladesh exported apparels last year to the tune of $ 6.0 billion.
Bangladesh suggested that by setting up joint ventures Bangladesh and Pakistan could easily compete with China and India in the WTO free trade area. They can jointly grab share of 30 billion dollars in $ 250 billion global textile trade. According to informed sources on the energy side Bangladesh was in better position than India and Pakistan. It had gas reserves sufficient for 30 years and coal reserves for 200 years. The consumption of gas in its industries had grown by 41 percent and about 500 new industries were coming up every month in Bangladesh.

http://www.financialexpress-bd.com/index3....id=8127&spcl=no

 

[Sharjeel]

BTW guys these people sometime make bluffs to force the gov into certain policys and vice versa...


but i think its a good thing..

Pakistani-STANs economy will improve if the two states co-operate...

Originally posted by bdmilitary@Nov 27 2005, 12:37 AM
Bangladesh suggested that by setting up joint ventures Bangladesh and Pakistan could easily compete with China and India in the WTO free trade area. They can jointly grab share of 30 billion dollars in $ 250 billion global textile trade.
http://www.financialexpress-bd.com/index3....id=8127&spcl=no

[post=3829]Quoted post[/post]​

"HUM AIK HEIN HUM AIK HEIN"

 

[Sharjeel]

some replies moved to "what is pakistan" in social talk

 

[sigatoka]

The Indian dude who said Bangladesh has no advantage over Pak. vis-a-vis textiles fails to understand that all Bangladesh needs is only a relative advantage. An Absolute advantage is not necessary for Bangladesh to benefit from trade with Pakistan.

I dont know whether u guys have heard of David Ricardo. He was a brillitant Jewish Economist who first proposed that even nations which was worse in everything compared to another could still benefit from trade.

Simple example. Husband Wife, Two tasks, Cooking Washing. The Husband is 10 times better in cooking than wife but only 2 times better in washing. If the husband only cooked and the wife only washed; they could both be better off by trading rather than each doing their own cooking and washing. Its known as the theory of comparitve advantage.

 

[Srirangan]

So you are making a generic claim that Bangladeshi industries are better than Pakistani industries in the textile sector. Fine, you are free to make such a claim. But can you back it up with reasoning?

Raw materials, Pak has plenty, BD has plenty.
Labour, Pak has plenty, BD has plenty.
Expertize, no doubt both have sufficient technical & managerial expertize.
Market, both are eying the same markets and neither has a distinct advantage over the other.

So why would a Pakistani org invest in BD when it's own country can benefit from the investment?

 

[sigatoka]

I am not making the claim that Bangladesh is better in textiles than Pakistan; to contrary I am making the claim that it is worse than Pakistan. The claim that im making is that bangladesh has a comparative advantage. This means that Bangladesh is less worse than Pakistan in textiles than other industries. It has a comparative advantage in textiles.

Just google the term comparative advantage and ull understand what im on about.

In relation to pakistani investment in textiles in Bangladesh. Well the pakistani investment in Bangladesh in Textiles will continue until the rate of return in Bangaldesh equals the rate of return in Pak. adjusted for risk. Therefore even though Pak. will invest less in Bang. than in Pak.; There will still be some Pak. investment in Bangl.