Free Trade Agreements: Our policy makers are busy negotiating several free trade agreements (FTAs). After successfully signing of such an accord with Sri Lanka and China, negotiations are in progress with Japan, Switzerland and EU to promote bilateral trade.
Signing of free trade agreements with EU, USA and Japan means that our exporters have to fulfil social compliances ie labour laws, health, environment, container security initiative and secure freight initiative, container scanning of export shipments being sent to USA from Pakistan and last but not the least supply chain and border security standards. The exporters fear that on non fulfilment of social compliance, buyers from the West will be making more demands for compliances and could also be easily used as a tool or a potential trade barrier.
These trade barriers which are commonly known as non-tariff barriers (NTB) ie safety, security, environment and labour laws etc will restrict our abilities to export in these markets. Fortunately the laws of anti-dumping duties and NTB dose not exist in Russia and CIS states. Therefore it will be wise to initiate dialogue with Russian Government regarding signing Preferential Trade Agreement (PTA), which will finally lead to Free Trade Agreement (FTA) between the two countries.
After signing FTA, it will be easy for both the countries to have access to each others market by reducing the duties on items of special interest.
SINGLE COUNTRY EXHIBITION: Organizing single country exhibition in Moscow means having direct market access not only in 80 Russian regions but also in 15 East European, 6 Central Asian, 12 CIS and 3 Baltic states.
This is due to the reason that the City Government has converted Moscow into a most vibrant economic hub of the region and the business firms, organisations and entrepreneurs of the region come here for their future business prospects. The countries like Turkey, China and India have captured a huge share of the market by frequently organising single country exhibitions. In Pakistan public and private sectors organises single country exhibitions abroad but they avail the business opportunities only from the country where the exhibition is organised.
In contrast single country exhibitions in Moscow will lead us to the whole region. Another fact is that most of the exhibitions organised by our public and private sectors abroad were turned out to be a fiasco which did not only resulted in huge financial loss to the exhibitors but also brought bad name to the country. The reasons for fiasco given by participants were mismanagement, poor arrangements and lack of proper information and guidance from the organisers. In contrast the exhibitions in Moscow are organised by highly professional organisations with state of the art infrastructure and most of them having experience more than 50 years.
The Minister for Textile Industries Mr Mushtaq Ali Cheema visited the 28 Federal Fair for Home textiles Moscow, in March 2007 and was entirely satisfied with the outcome of the fair.
IMPORTS FROM RF: To face the challenges of Globalisation the Govt had carried out economic reforms to make Pakistan's economy competitive. Russia is in a position to assist us in developing our infrastructure, modernization of our Industrial and agriculture sector, Human resource development and boosting the competitiveness of our industries.
Russia can help us in the development of Water & power, oil & gas and heavy industrial complex. Chemicals, fertilisers, wood pulp, iron & steel ect can be imported at very competitive prices.
BUSINESS OPPORTUNITIES IN RUSSIA: With its population of 145, 1 million people and its annual purchasing power of 700 billion dollars, the Russian Federation is a market of great importance. This massive population, together with the neighbouring countries, forms a potential market in the field of Textile and Garments, Rice, leather, sport goods, surgical equipments and pharmaceuticals.
THE KEYS TO SUCCESS FOR PAKISTAN: The keys to success for Pakistani textile exporters are:- a flexible pricing policy, aggressive promotion of new products, a continuous presence, direct contacts with end-users, co-operation with reputable and knowledgeable local distributors, expansion into regional markets with a wide product range.
The best prospects for Pakistani textile suppliers in the next three years will be in new "high-tech" product lines for all textile categories, but especially those for upholstery and adolescent fashions.
After the break up of Soviet Union in 1991 the whole world focused its attention on the Russian consumer goods market. The major exporters of consumer goods were China, India, Turkey, Korea, Taiwan, Italy, Poland and some West European countries. Unfortunately the public and private sectors of Pakistan due to reasons unknown were not able to capitalise the opportunities in the Russian market.
There is a need to find out the reasons which are hampering our exports in this vast land of opportunities. I came to the conclusion that there are 4 major reasons which are hampering our exports to Russia.
THESE ARE:
-- Lack of awareness regarding the Russian consumer's goods market.
-- Non availability of warehouse facilities and subsidy in Russia;
-- Non availability of a Pakistani Bank in Russia
-- Non availability of freight subsidy to Russia
I would like to suggest the following to the Ministry of Textiles, Commerce and TDAP, for enhancing the trade volume up to one billion dollars within next few years.
1. Signing of Preferential Trade Agreement (PTA), which will finally lead to Free Trade Agreement (FTA) between the two countries.
2. To diversify Pakistani exports in the rich Ural and Siberian regions, this will of course raise the question for goods transportation and for that we suggest to connect these regions with Gwadar deep seaport. This port is already connected with Central Asian States and China with a network of roads.
3. Establishing of warehouse, display centre and a bank in Moscow.
4. Ministry of Commerce to extend freight subsidy for Russia as this will enable Pak textile to become competitive in Russian Market.
5. As already existing Business Councils in many countries, I suggest establishing a business council which will consist the members of both the countries, this will accelerate the trade and business activities thus increase the trade volume at rapid pace.
6. We wish Russia to join a multi-billion-dollar project of IPI to build a gas pipeline to transport Iran's natural gas to India and Pakistan. We believe that Russian participation will ensure the security and acceleration of the process. This will also bring peace, and economic prosperity in the region.
7. We request both the Governments to make possible in establishing of Pakistani bank in Moscow and Russian Bank in Karachi.
8. In order to bring closer the people of both the countries, the Governments of both the countries on their initiative should send culture troupes, media people, students groups to each other countries and exchange of TV programs highlighting the life of both the countries.
I am confident that after taking these measures it will make a breakthrough in enhancing the trade volume between our countries.
Russia and Pakistan need stability and security in the region as well as world-wide. Both countries stand for equality and justice, inter-ethnic and inter-religious harmony in relations between members of the international community. New horizons are to be explored. Nowadays the existing opportunities allow developing a better mutual understanding.
Director Pakistan Russia Business Council (FPCCI) and CEO, Integrated Textiles Network.
(The author is the Director of the Pakistan-Russia Business Council (FPCCI) and the CEO, Integrated Textiles Network.
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