The government of Sindh appears totally ineffective and helpless in resolving the issue of notices being sent, even to multinational companies, by Site Town Municipal Administration (TMA), Karachi, requiring them to obtain trade licence, or face penal action.
Industrialists of Site industrial area have been agitating for the last several weeks against the issuance of notices by Town Officer, TMA, on the ground that there is no justification for charging fee for obtaining trade licence. Even Sindh Industries Secretary had supported their case and informed TMA that Site Ltd, which is a government body, has been providing municipal services and as such TMA's move was not justified, but without any result.
On the directive of Sindh Chief Minister, Industries Secretary had informed TMA that no action or harassment shall be carried out against the notices already issued and no further notices shall be issued. The case was sent by the Chief Secretary to the Additional Chief Secretary Development and also referred to Secretary Local Bodies for excluding Site Town from the purview of TMA for the reasons that Site Ltd provides all municipal services including water, infrastructure, removal of garbage and other facilities.
The notice issued to Merck Pharmaceuticals (Pvt) Ltd, which is a subsidiary of Merck KGAA of Germany, required that since it is carrying on the trade of manufacturing medicines since July 2001, a licence is required under the provisions of Sindh Local Government Ordinance 2001.
"Doing an act without licence constitutes a cognisable offence, as envisaged under sub-section (2) of section141 of the Sindh Local Government Ordinance (SLGO) 2001 entailing imprisonment and fine extending to three years and Rs 15,000 respectively."
The notice further says: "Whereas you are carrying on the trade without obtaining a licence, you are hereby called upon to call on at my office, within seven days from the date of receipt of this notice and obtaining a licence against payment of the prescribed fee, failing which the Town Administration shall be constrained to refer the matter to the Station House Officer (SHO) of the concerned police station for registration of FIR".
Merck has been present in Pakistan for more than 40 years. It belongs to Merck KGAA, Germany, and comprises three companies. Merck (Pvt) Ltd has its manufacturing facility in Quetta. The production facility located 700 km north-west of Karachi, in Quetta, is involved in the manufacturing and packaging of solids (tablets & capsules), liquids (syrups), injectibles (ampoules) and ointments.
The company has three major pharmaceutical/therapeutical areas, namely CardioMetabolic Care & Oncology, nutrition, infection & fertility and NeuroCare. There is another business unit, which is dealing with chemicals & diagnostic products & services known as performance & life science chemicals. A separate note in Urdu, issued on the order of Town Officer, warns Merck Pharmaceuticals that in case they don't deposit the money and copy of trade licence within seven days their electricity and gas would be disconnected.
Industry asserts that electricity is only disconnected by the utility in terms of Nepra rules and regulations as would apply including in cases of defaults. Similarly, in the case of gas it is subjected to the performance of the consumer which is based on compliance of the contract between Sui Southern Gas and the consumer.
Industry is concerned that such notices, which have no relevance with the SLGO, are being issued to pressurise and harass the industrialists. Industrialists say that already the industry is collapsing and many factories have either closed down or are on the verge of closing down.
They said that the State Bank of Pakistan Governor in his monetary policy statement had said that the biggest challenge for the country is to develop the business climate. Industry is questioning whether such moves by TMA, which does not even recognise the advisory note issued on behalf of Chief Minister that there will be no harassment of the industry, is actually contributing towards damaging the business climate.
Commenting on the situation, Engr M A Jabbar, Chairman of Site Association of Industry (SAI), urged that the Chief Minister should take cognisance of the level of effectiveness of his governance where his directives are blatantly ignored.
SAI sent an urgent letter on April 22 to Secretary, Industries, informing him that Town Officer, TMA, Site Town had not refrained from issuing notices to the industrialists in Site area in respect of obtaining trade licences. The case of Merck has been particularly mentioned in this regard and it has been requested that status quo be maintained as decided in the meeting held in Industries Secretary's office recently.
The SAI Chairman is of the view that such notices to multinationals would become part of the surveys circulated by the World Bank and other international financial institutions for determination of available business climate in Pakistan and put Pakistan's rating down. Pakistan is seeking overseas investments and strenuous efforts are being made to improve its perception and image with regard to available climate of business for foreign investors, he said.