Upward Economic and Social Mobility in Pakistan

[Riaz Haq]

Over the last two decades, Pakistan has continued to offer much greater upward economic and social mobility to its citizens than neighboring India. Since 1990, Pakistan's middle class had expanded by 36.5% and India's by only 12.8%, according to an ADB report on Asia's rising middle class released recently.

The simplest definition of the middle class is a group of people in a society who are neither rich nor poor. The middle class has always been considered vital to a country's political stability and economic growth. The rich and the poor simply distrust each other too much to let the other govern. Nations with large middle class populations find it easier to reach consensus on sustaining good, democratic governance.

Unfortunately for Pakistan, the size of the middle class was very small when it came into existence, and the country was dominated by a small powerful feudal elite created by the British rulers to sustain their colonial rule. And the urban middle class remained small for decades. The situation has, however, finally begun to change in the the last decade of 1999-2009 with a combination of increasing urbanization and faster economic expansion that fueled significant job creation in the industrial and services sectors to enable middle class growth.

An ADB report on Asia's rising middle class released this month confirms that Pakistan's middle class has grown to 40% of the population, significantly larger than the Indian middle class of about 25% of its population, and it has been growing faster than India's middle class. The other significant news reported by Wall Street Journal today says the vast majority of what is defined as India's middle class is perched just above $2 a day, making it vulnerable to various shocks. This is also true of Pakistan.

Here are the details of income levels in India, Pakistan and China as reported by ADB:

Daily Income......$2-$4.......$4-$10........$10-$20.....Over $20

India...............20.45%......4.15%........0.45%........0.10%

Pakistan............32.94%......6.56%........0.62%........0.15%

China ..............33.97%......25.17%.......3.54%........0.68%

Pakistan has continued to offer much greater upward mobility to its citizens than neighboring India. Since 1990, China's middle class population has expanded by 61.4%, Pakistan's by 36.5% and India's by 12.8%.

In terms of education, average number of years of schooling in Pakistan is 13 years, 3 years more than India's 10, according to an education comparison published by Newsweek recently. An average Pakistani is, therefore, better educated and more capable of earning higher income than an average Indian.

In terms of absolute numbers in millions of people, China and India are naturally the biggest contributors to the rising population of Asia's middle class that is driving increasing consumption. They are followed by Indonesia and Pakistan vying for the third place.

The ADB report discusses in some detail the impact of Asia's rising middle class on a whole range of social, political and economic developments in the world. The report argues that "Asia’s large population and the rapid expansion of its middle class during a period of global economic rebalancing is fundamentally important as a driver not only of the Asian economy but also the global economy. However greater middle class wealth and consumption is only one factor in the region’s increasing importance. The rise of its middle class is likely to aid not only the growth process, but also result in substantial social, political, and environmental changes. Thus, the contention is that, building on strong growth and continued progress in reducing poverty in Asia, developing a stable middle class requires governments to formulate and implement middle class-friendly policies. In turn, this requires understanding and analyzing the characteristics of the middle class, the factors contributing to its growth, and the various implications—positive and negative—of its rise. These are some of the issues this special chapter addresses".

Here are some of the key points of the ADB report:

1. While 56% of developing Asia’s population, or nearly 1.9 billion people, were already considered part of the middle class based on an absolute definition of per capita consumption of $2–$20 per day in 2008, nearly 1.5 billion Asians were still living on less than $2.0 per day. Moreover, the majority of the Asian middle class still falls in the $2–$4 range, leaving them highly vulnerable to slipping back into poverty due to economic shocks. Thus, for the middle class to become a prominent force it will likely depend on its size and spending levels and characteristics. It will require governments to introduce policies that bolster the incomes of those already in the middle class. It will also require social policies to expand the middle class—such as through greater spending in education and health. Through these, it is possible to build a strong and stable middle class that continues to grow.

2. According to the “political economy” argument, societies with a small middle class are generally extremely polarized, and find it difficult to reach consensus on economic issues; they are overly focused on the redistribution of resources between the elite and the impoverished masses, each of which alternates in controlling political power. Societies with a larger middle class are much less polarized and can more easily reach consensus on a broad range of issues and decisions relevant to economic development (Alesina 1994).

3. Besides helping to reach consensus, Banerjee and Duflo (2008) have discussed three mechanisms through which a large middle class could promote development. First, the middle class may provide the entrepreneurs who create employment and productivity growth in a society. Second, “middle-class values”—that is, the values of accumulation of human capital and savings—are critical to economic growth. And third, with its willingness and ability to pay extra for higher-quality products, the middle class drives demand for high-quality consumer goods, the production of which typically presents increasing returns to scale. This encourages firms to invest in production and marketing, raising income levels for everyone.

4. Middle class is not inimical to the interests of the poor. Indeed, Birdsall (2010) argues that “… in the advanced economies the poor have probably benefited from the rule of law, legal protections, and in general the greater accountability of government that a large and politically independent middle class demands, and from the universal and adequately funded education, health and social insurance programs a middle class wants and finances through the tax system… A focus on the middle class does not exclude a focus on the poor but extends it, including on the grounds that growth that is good for the large majority of people in developing countries is more likely to be economically and politically sustainable, both for economic and political reasons.”

Talking about Pakistan's growing middle class, Professor Rasul Baksh Raees, head of social sciences at the Lahore University of Management Sciences, told the Christian Science Monitor that "the reach and influence of civil society has grown as Pakistan’s middle classes have become more affluent, organized (thanks in no small part to the Internet age), and confident".



The years 2007 and 2008 saw increasing political activism in Pakistan as many members of the nation's newly expanded middle class, most of whom rose to middle class status during Musharraf's economic boom, left the comforts of their homes for the streets to march against the suspension of civil liberties and the firing of Pakistan's chief justice by former President Musharraf. A test of the middle class now is how it responds to the current crises ranging from political instability, poor governance, rising corruption, economic stagnation and the massive flooding that is taking its toll on the nation. At this moment, the greatest need of the hour in Pakistan is greater social activism by the middle class to help their unfortunate fellow citizens devastated by the unprecedented floods sweeping the nation's rural landscape. Early media reports are encouraging, indicating that some Pakistani middle class networks are mobilizing to provide assistance to the flood victims. As the support efforts move from rescue and relief to reconstruction and rehabilitation, my hope is that Pakistan's middle class will be engaged in helping their fellow citizens for the long haul. Such sustained engagement will be a part of Pakistan's defense against religious extremism and radicalization of some in its alienated young population.

Here's a video clip on Pakistan's middle class:


Related Links:

Haq's Musings

Pakistan: a modern history By Ian Talbot

Disaster Dampens Spirits on Pakistan's 63rd Independence Day

Pakistan's Decade of Middle Class Growth

Comparing India and Pakistan in 2010

Indian poverty

Pakistan Wage Structure 1990-2007

Middle Class Clout Rising in Pakistan

Urbanization in Pakistan

The Rise of Mehran Man

Industr ial Sector of Pakistan

India Has No Middle Class

Pakistan's Foreign Visitors Pleasantly Surprised

Escape From India

Reflections on India

After Partition: India, Pakistan and Bangladesh

The "Poor" Neighbor by William Dalrymple

Pakistan's Modern Infrastructure

Video: Who Says Pakistan Is a Failed State?

India Worse Than Pakistan, Bangladesh on Nutrition

UNDP Reports Pakistan Poverty Declined to 17 Percent

Social and Cultural Transformation in Pakistan

Pakistan's Choice: Talibanization or Globalization

Pakistan's Financial Services Sector

Pakistan's Decade 1999-2009

South Asia Slipping in Human Development

Asia Gains in Top Asian Universities

Pakistan's Industrial Sector

Pakistan's Multi-Billion Dollar IT Industry

India -Pakistan Military Comparison

Food, Clothing and Shelter in India and Pakistan

Pakistan Energy Crisis

[Riaz Haq]

Here's an excerpt from a Dawn Op Ed by economist Sakib Sherani:

The estimates of the size of Pakistan’s middle class are truly astounding. Amongst the first to take a stab at this nearly a decade ago, as part of a request from a large fast-moving consumer goods (FMCG) client, I estimated the cohort to be at around 35 to 40 million, using a global definition of ‘middle class’ taking into account just one parameter — income. Later, eminent economic historian and commentator Shahid Javed Burki published his estimate in the context of the expansion of the middle class in the Musharraf years, and also arrived at a figure of around 40 million.

More recently, while preparing my presentation on ‘The Pakistan Opportunity’ for the Marketing Association of Pakistan’s flagship event MARCON 2012, I updated the figures arrived at earlier, making one crucial adjustment: for the estimated size of Pakistan’s undocumented (or, ‘black’) economy. The adjusted figure for the middle class is a staggering 70 million people, or 40 per cent of the population.
-----------
To put this number in perspective, Pakistan’s middle class is larger in size than the individual population of UK, France and Italy — and is a shade smaller than the total population of Germany. In absolute terms, it is the fourth largest middle class cohort in Asia, behind China, India and Indonesia. Affluent, educated, urbanised, and increasingly ‘globalised’, Pakistan’s middle class is not only growing, but is already a voracious consumer. The ADB report estimated total consumption spending by this group at $75bn.

This can be gauged by the furious pace of sales nationwide of cars, motorcycles, cellphones and durable goods over the past few years. Over 1.5 million motorcycles and nearly half a million cars have been sold in the country since 2008 (based on registration data), while the number of cellular subscribers has crossed over 100 million. True, despite such ‘glamorous’ numbers, Pakistan is a two-speed economy where the vulnerability of too many people has increased. Successive shocks to the economy — a severe energy crisis, unprecedented floods for two consecutive years, a fight against militancy which has gone on for several years — have all taken their toll on jobs and incomes.

However, despite these challenges, what amazes observers and commentators alike is the sheer resilience of the Pakistani nation.

Over the past few years, this resilience has come to a large extent from the performance of the rural economy, which has drawn strength from bumper crops and booming prices. The government’s intervention in the market for wheat has poured an additional several hundred billion rupees into the rural economy, propelling demand for cars, motorcycles, tractors, durable goods as well as fast-moving consumer goods (FMCG). In fact, the FMCG sector has witnessed an unprecedented boom in sales since 2008, which has defied expectations — and gravity.

Additional support for consumption has come from remittances from the Pakistani diaspora, and, in part, from the fiscal behaviour of the government which has injected several hundred billion rupees into the economy via borrowing from the central bank. From the foregoing, it is clear that the Pakistani consumerism story is not cyclical, but has structural underpinnings. Rapid urbanisation, a young, mobile and spirited population entering the work force, global connectivity via the Internet, social media and cable TV are all driving aspirations — and conspicuous consumption...

http://www.dawn.com/2012/03/23/consumption-conundrum.html

[Riaz Haq]

Here's an LA Times story on gated communities in Pakistan:

Reporting from Rawalpindi, Pakistan — The houses and manicured lawns slope up the artificial hill edged by unbroken sidewalks and white picket fences, as children play and residents exchange pleasantries.

This sprawling subdivision called Bahria Town — "Come home to exclusivity," it boasts — operates its own garbage trucks, schools, firehouse, mosques, water supply and rapid-response force — a kind of functioning state within a nonfunctioning one. And all supplied without the bribes you'd pay on the outside, residents say.

"I like living here," said Abdul Rashid, a sixtysomething retired government worker. "It's like you're in a little protected country — tidy, utilities work, the family can relax. If there's any problem, you just ring up security."

The jarring presence of a middle- and upper-class retreat in this increasingly violent nation has been paved, in part, by the involvement of the country's powerful military. Benefiting from laws put in place during British Empire days to reward friendly armies and militias with land grants, the military now controls about 12% of Pakistani state land, by some accounts. And its privileged position allows it to partner with and otherwise route valuable tracts to favored developers.

Bahria Town and its partner, the military-run developer Defense Housing Authority, occupy twice as much land as Rawalpindi, the garrison city 30 minutes from the capital, Islamabad.

In the posh Safari Villas subdivision, past Sunset Avenue and College Road, Mohammad Javed, 69, surveys his pocket garden before heading into his three-bedroom corner house with a beige sofa ensemble and Samsung flat-screen TV. Houses in the neighborhood run from $25,000 to $60,000, well out of reach of most Pakistanis.

Bahria Town has been a hit not only with moneyed Pakistanis but also with returnees. Javed, who owned a gas station in Canada before retiring, hopes to replicate his North American lifestyle. Bahria's protective walls bring security, he said, although he still won't let his grown children visit lest something bad happen beyond its confines. "We meet in Thailand or Canada," he said.
-------
"No one besides the military has such access," she said. Bahria Town advertised on a recent Sunday for retired major generals and lieutenant generals to fill positions at the company, Siddiqa said: "These are his keys" to greater access.

But for resident and food industry entrepreneur Shaheryar Eqbal, these are minor issues relative to what Bahria Town delivers.

"The government should take these communities as a model and replicate them," he said. "The army already has a joint venture with Bahria Town. Things work. Pakistan must get through this terrorism phase, but this could really be the future."

http://articles.latimes.com/2011/oct/06/world/la-fg-pakistan-gated-...

[Riaz Haq]

Here's an ET story about rising middle class consumption in Pakistan:

It is the paradox that puzzles everybody: the headline numbers indicate an economy in an abysmal state, but everywhere one looks, there are people shopping like there is no tomorrow. How is this possible? An analysis conducted by The Express Tribune reveals a surprising answer: women.

While the headline GDP numbers suggest sluggish economic growth, not all sectors are underperforming. A closer look suggests that the economic slowdown has been far from uniform, with some sectors booming, while others are in a deep slump. The retail and wholesale sector in Pakistan was worth about $40 billion in fiscal year 2012, and has been growing at 5.3% in real (inflation-adjusted) terms for the past five years, much faster than overall economic growth during that period.

And the benefits of this growth have been visible throughout the country. While large shopping malls opening up has become common place in cities like Lahore and Karachi, national newspapers now carry advertisements for shopping malls in smaller cities like Dera Ghazi Khan, Sukkur, Sargodha, etc as well. The average Pakistani household is very clearly more able and more willing to shop than ever before.

The reasons for this newfound consumerism are complex. Despite all the complaints about inflation, household incomes for Pakistanis in urban areas rose faster than inflation by an average of about 1.5% per year between 2006 and 2011, a period of extraordinarily high inflation rates. (Rural Pakistan did not fair quite as well.) The average household size also fell during that period, further raising per capita gains....
---
The reasons for why women have entered the workforce are manifold. Education levels have been rising rapidly across the board. Fertility rates have dropped from 7.1 in 1980 to just over 3.1 in 2011, causing household sizes to decline. Women with fewer children have more freedom to pursue careers outside the home.

And persistently high inflation may also have forced many families to consider being more open to women working outside the house: a second income can clearly go a long way in changing the fortunes of a household. It has clearly already helped the economy through a particularly difficult time.

http://tribune.com.pk/story/406355/the-rise-of-the-pakistani-middle...

[Riaz Haq]

Here's a Dawn story on trendy restaurants Ramadan menu choices in Karachi:

Who would have ever imagined that one day chicken schezwan and prawn on toast would be considered as food items to break the fast with? Not just that, these days there are restaurants in Karachi that serve juicy cheese burgers with fried chips as Iftar deals.

Those who believe only technology has taken giant steps to help the world progress by leaps and bounds, they should know that traditional food has given way to newer cuisines with a great degree of success too.

Traditionally things that one gets to eat at Iftar is a plate of fruit chaat, a bowl of chick pea and potato mix, dates, pakoras and a pitcher of sherbet. This is very much the case even now.

But for those who like to eat out, and Karachi now brims with food lovers who love to step out of their houses to eat, their taste buds for Iftar yearn for something ‘different’. The myriad of restaurants in the city provide them with just that: something different.

Nowadays among the many eateries that (fasting or not fasting) Karachiites turn to minutes before Iftar include a seafood restaurant (of all the places), a burger joint and a pizza parlour.

Seafood, for some odd reason, is making its presence felt. There are people who love to indulge in prawn-chomping at dusk. This has even surprised those who work at the restaurant.

“We have special Iftar deals in boxes. These boxes contain all kinds of food, including seafood. And foodies like that. If you ask about the number of people who visit us, I can tell you that each year the number increases. While we serve food at Iftar, we also deliver our stuff at people’s doorsteps,” said Talha, an order-taker at a seafood restaurant.

This may all sound mouth-watering, but when it comes to the rates at which these deals are sold, not everyone can afford them. A pack of a dozen chicken wonton costs no less than Rs300. But then only those who have enough money generally eat out. And there is no dearth of such people in Karachi.

Add to all of this a new trend. Chinese food is in with a certain section of the fasting public. In this case, they order food for home delivery as not many Chinese restaurants offer dine-in facilities at Iftar. “People order all kinds of dishes. It may be hard to believe, but there are some who call us to home-deliver sushi to them. Chicken manchurian and chicken schezwan are also regular items. Perhaps the one dish that never loses its charm is chicken chowmein,” said Imran who works at a known Chinese takeaway restaurant.

There is a different side to this scenario as well. The mushrooming of restaurants, especially in upscale localities, has dented the business of established eateries. A case in point is a restaurant at Khayaban-i-Tauheed. Anil, who works here, said: “This year we are getting 40 to 50 customers on a daily basis. Last year, and the years before that, the situation was different. We used to have a much bigger crowd. A few reasons could be given for it, for example inflation has skyrocketed. Perhaps the more convincing reason is that each year countless new eating places and coffee shops open up. This affects the business of the ones already in the market. As far as what food people prefer at Iftar, well, it’s the normal stuff (pakoras and dates), but for the main course they like to have all kinds of cuisines ranging from Italian to continental to desi.”

The eating-out trend has its pluses and minuses. If, on the one hand, it refreshes traditional values with a dash of contemporariness, on the other, it also points to a certain kind of commercialism that has crept into every aspect of our lives.

http://dawn.com/2012/08/05/iftar-the-trendy-way/

[Riaz Haq]

Here's a BR piece on Colgate Palmolive Pakistan:

Colgate Palmolive Pakistan, one of the leading manufacturers of personal care and consumer products in the country, began its operations back in 1985 when the US granted the firm license to manufacture and market Colgate Palmolive products in Pakistan.

Currently, the firm is engaged in the production and marketing of some of the leading international brands of oral and personal care products, bringing a few of the world's most trusted household names such as Colgate Toothpaste and Palmolive Naturals to the Pakistani market.

Working under the umbrella of the Lakson Group, the company boasts of 450 distributors across the country and has been a KSE top performer, being listed amongst the Top 25 best performing companies for seven years straight as of 2012.

Financial highlights The company's accounts ended 30th June saw its Net Profits go through the roof, managing a 38.7 percent increase to top off Rs 1.6 billion versus Rs 1.17 billion recorded last year on account of a hefty top-line growth that saw sales climb by 28.6 percent year on year.

The steady growth in revenue, which amounted to Rs 18.71 billion- up from Rs 14.15 billion in the last year-came mainly off the back of the firm's well spent money devoted to advertisement and distribution as well as through effective in-store promotions which allowed the relevant brands to achieve steady volume growth thorough out the year.

The company managed to retain profitability as a result of their ongoing cost-saving initiatives which enabled to offset the exorbitant input prices hindering most other manufacturers. Consequently, the firm also made small price adjustments across various products to pass on the rising costs of packaging and raw material to the consumers, thereby ensuring that the Gross profit margin only saw a small decline, going down to 28.92 percent as compared to 29.40 percent.

However, despite the fact that the rising input prices dampened the firm's stellar top line growth somewhat, Colgate continued to steadily increase its overall spending on sales promotion which has been mainly responsible for the propagation of the company's sales volumes. Overall, the media and promotional spending increased by 43 percent, going up to Rs 1.6 billion as compared to Rs 1.1 billion spent during the same period last year.

The year-end also saw Colgate's financial position improve as the firm's cash and cash equivalents increased by 35.3 percent, signing off at Rs 840 million, up from Rs 620 million recorded during last year.

Key operational highlights In the previous quarter, Colgate Palmolive Pakistan had launched "Brite Anti Bacterial Detergent" powder, which was the first such product in the Pakistani market. Marketed as a detergent with a unique germ-busting formula, this latest innovation was hailed positively by the consumers. The product continued to strengthen Colgate's equity during the last leg of FY12, and was a major driver of sales volume growth.

In the dishwashing category, Colgate saw increasing competition from a number of local and imported brands, however, the firm arranged a brand re-launch for the entire Lemon Max range. This make-over saw one of the pioneer dishwashing products on the market undergo an overhaul and acquiring a new look. Formulated with real lemon juice, the re-launched Lemon Max boasted greater grease cutting powers in heavily circulating adverts, which allowed increased brand equity and sales growth......

http://www.brecorder.com/brief-recordings/0/1238003/

[Riaz Haq]

Here's a News story on rising obesity in Pakistan:

KARACHI: The obesity is an emerging challenge to human well-being like other parts of the world, it was also on the increase in Pakistan.

The overweight and obesity are the fifth leading risk for global deaths.

The World Health Organization (WHO) estimates suggest that 26 percent of women and 19 percent of men in Pakistan are obese. Women are 2-3 times more likely to be obese.Childhood obesity is increasing with an estimated value of 10 percent.

This was stated by Prof Dr Muhammad Iqbal Choudhary, Director International Center for Chemical and Biological Sciences (ICCBS), Karachi University.

He was delivering a lecture on Wednesday at the 4th International Symposium-Cum-Training Course on Molecular Medicine and Drug Research being held at the International Center for Chemical and Biological Sciences (ICCBS).

Over 350 scientists, including 35 scientists from 24 countries, are attending the international event, organised by Dr Panjwani Center for Molecular Medicine and Drug Research (PCMD), University of Karachi.

Dr. Iqbal said that obesity had become a serious health problem worldwide, which is a result of an imbalance between energy intake and expenditure; the molecular cascade involves in obesity and associated disorders are not fully understood.

Proliferation of adipocytes plays an important role in the onset and progression of obesity, he added.

`Obesity has been linked to several serious health ailments like heart disease and stroke, high blood pressure, diabetes, cancer.

Overweight and obesity are major risk factors for a number of chronic diseases, including diabetes, cardiovascular diseases and cancer; once considered a problem only in high income countries, overweight and obesity are now on the rise in low and middle-income countries.

Overweight and obesity are largely preventable; the intake of healthier foods, and regular physical activity are easiest ways to prevent obesity, he said.

There is an urgent need to have R&D programme in the field of anti-obesity drug discovery and development, he urged, saying that the fundamental causes of obesity are an increased intake of energy-dense foods that are high in fat, salt and sugars but low in vitamins, minerals and other micronutrients; and a decrease in physical activity due to the increasingly sedentary nature of many forms of work, changing modes of transportation and increasing urbanization.

Talking about the multi-drug-resistant pathogens, he said that a rapid decline in research and development on new antibiotics coincides with increasing frequency of infections caused by multi-drug-resistant pathogens.

The key reason of bacterial resistance is the indiscriminate of suboptimal use of antibiotics. During the last three days of the symposium, various lectures of the national and international scientists were held on different scientific issues.

http://www.thenews.com.pk/article-83095-Obesity-on-the-increase-in-...

[Riaz Haq]

Here's Shan COO's interview with PakistanToday:

Tell our readers about Shan Foods (Pvt.) Ltd. that you joined in July, 2007.
FAISAL MUBIN GANATRA: The journey of Shan’s remarkable success starts from 1981, when the dream of one man became a reality. A visionary entrepreneur, an avowed humanist and a committed philanthropist, Shan Foods (Pvt.) Limited CEO Muhammad Sikander Sultan, helped pave the way to success by pioneering in the spice business. “We are one of the most reputed food company and a powerful global brand with presence in more than 63 countries across 5 continents.”
Shan Foods has been governed by its core values. They shape the culture and define the character of Shan, forming the foundation on which its employees perform and make decisions. Long term thinking, integrity, mutual respect, pragmatism, openness to diversity, passion for quality and delighting consumers in accordance to the Islamic laws remain at the core of our company culture.”
“By the grace of Almighty Allah, our Islamic culture and value remain our single most important competitive advantage”.
Company’s vision is to become a global food company offering premium quality innovative products which delight our consumers. “We are determined to reach every kitchen by diversifying into growing food categories through innovative, healthy and safe products for the ultimate delight of our consumers”,
Shan Foods is committed to producing top quality products. To do so, we pay a higher price compared with our competitors for premium raw materials. We are also the only second company in the Asia Pacific region that uses Cryogenic Technology to preserve the taste, texture and aroma in order to ensure our spices & foods are bacteria-free. Finally, we use food-grade nitrogen & aluminum foil packaging to preserve freshness and quality (V Lock Freshness). Our dedication to producing the highest standard products and our belief in long-term mutually beneficial relationships means we are happy making nominal profits: that is a key reason for our survival and prosperity.
In 2006, our CEO Mr. Sikandar Sultan and BOD’s decided to induct a professional team for the survival of brand, sustainable growth and transformation into a corporate company. When I joined Shan Foods, it was being run as a sole proprietorship, but we had a plan that by January 2008 we would start business as a Private Limited concern which I have been responsible for. I started as Chief Financial Officer and have been heading business operations for the last 1.5 years.
Today, Shan is Pakistan leading Food Company with its products being appreciated globally and continues to introduce new products that better cater to the changing needs of the consumers. In order to take advantage of growth opportunities, Shan has now enhanced its production capacity even further with the manufacturing units installed in United Arab Emirates (UAE) and Saudi Arabia and United Kingdom.

PAKISTAN TODAY: What difference did the induction of professionals make? What is the secret of Shan Foods success?
FAISAL MUBIN GANATRA: Shan has been growing since it was founded but the professional team that was added to the company in 2006 has had a huge impact on the company practices. By implementing a new set of procedures and cultivating a new corporate environment, Shan has become an increasingly transparent company with proper systems in place and a culture respect, trust, transparency and sharing information at all levels of management. This change has reaped benefits in 2011-12, our turnover was double what we made in 2009-10. The secret of our success lies in the upholding of our values & the belief that change comes from the top....

http://www.pakistantoday.com.pk/2013/01/21/news/profit/shan-foods-c...

[Riaz Haq]

Here's an ET report on global consumer products' giant P&G's expansion plans in Pakistan:

KARACHI: Procter and Gamble (P&G) has identified Pakistan as one of its top 10 emerging markets – that include emerging economies like Brazil and India – and the country will be the focus of it attention for further investments, P&G Pakistan Communications Manager Omeir Dawoodji told a group of journalists during a visit to the company’s state-of-the-art manufacturing facility at Port Qasim on Thursday.
Dawoodji was tight-lipped regarding the amount P&G plans to invest. He, however, confirmed that the Cincinnati, Ohio-based consumer goods giant wants to expand its manufacturing footprint in the country.

Dawoodji did not disclose the cost of setting up the Port Qasim plant, currently manufacturing the Ariel brand, but emphasised that P&G intends to make it a mega-manufacturing facility and utilise it for manufacturing other brands as well. The company markets over 300 brands globally, but its Pakistani subsidiary only deals in eight brands.
P&G Pakistan had acquired a huge piece of land for the manufacturing facility, which was inaugurated in 2010, but it utilised about 20% of the acquired land only, leaving enough space for further expansion.
It has been 185 years of growth for the now $85-billion company and further growth has to come through emerging markets, Dawoodji said, explaining why Pakistan is important for the company’s global parent.
The manufacturer of some of the leading brands like Pampers, Always and Safeguard has had tremendous growth during the past three years. P&G’s revenue for the year ended June 2012 was Rs22 billion, about 50% increase over the previous year.
The fiscal year 2012-13, too, will be a high growth year for P&G Pakistan, the company’s country head Faisal Sabzwari told The Express Tribune in a recent interview.
In a sign of its long-term commitment to the country, the Pakistani arm of the consumer goods giant has replicated its global strategy of incorporating the use of renewable energy sources for energy conservation, reducing water consumption and recycling the waste as demonstrated during the plant’s tour.
The facility at Port Qasim has been designed to use skylight during the day with a lot of windows built both in the office and the factory areas. They have been able to reduce their energy consumption by 12% during the last two years, the officials at the site told the media.
The reduction in water usage was about 46% as they have planted palm trees and used gravel instead of grass for the landscape to conserve water. “We put less than 2% of our waste to landfill,” an official said. About 97% of the waste generated is put to beneficial reuse, he said.
“The Port Qasim plant is our pride among the 75-plus plants P&G operates all over the world,” Dawoodji said while highlighting state-of-the-art features of the plant. “Goods manufactured at this facility can be exported to countries with rigorous quality standards.”

http://tribune.com.pk/story/566034/procter-and-gamble-lists-pakista...

[Riaz Haq]

Here's an ET story on middle class powering FMCG growth in Pakistan:

Procter & Gamble (P&G), one of the world’s largest consumer goods company, has recognised Pakistan as one of the top 10 emerging markets to focus investment in. This sounds like good news for our cash-strapped economy, and it is equally good news for those who have invested in P&G.
It makes sense for any fast moving consumer goods (FMCG) to invest in a country where the world’s biggest consumer goods names – Unilever, P&G, Nestle and Mondel-z (formerly Kraft Foods) – are not only operating, but also growing significantly.
According to the State Bank of Pakistan, the net profits of FMCG companies listed on the Karachi Stock Exchange grew in excess of 20% in fiscal year (FY) 2011-12. P&G, which is not listed on the KSE, has witnessed tremendous growth in revenues during the past three years – including 50% revenue growth in FY2012. Besides the consumer goods sector, its supporting industries like packaging and distribution companies have also seen their toplines grow significantly.
So what are the factors contributing to this growth?
If the fact that these companies are selling essential food items and consumer goods in the world’s sixth-largest market by consumer size is not satisfying enough for you, here’s a more detailed and nuanced explanation.
“Economics and demographics are together at play in Pakistan,” P&G Pakistan Country Manager Faisal Sabzwari told this correspondent in a recent interview. The boom in the rural economy has also been a major contributor to their growth – thanks to a series of bumper crops of agricultural produce and wheat support prices, which were raised by the government in recent years.
Besides this, according to Sabzwari, Pakistan is one of the top countries adding 20-somethings to its workforce; these are the people establishing families, getting new jobs and helping market sizes grow.
“We have millions of consumers entering independent disposable income space in their lives every year,” Sabzwari said, while referring to the growing middle class.
The market size in Pakistan has also grown in terms of volumes, without taking pricing into account. “Increasing urbanisation and the growing middle class are key drivers of the FMCG business,” Sabzwari said.
Pakistan’s is urbanising faster than other developing countries, according to Sabzwari. “The country’s population is growing at under 3%, while the rate of migration to urban centres is even higher,” according to Muzammil Aslam, managing director at Emerging Markets Rsearch.
“A population base of 180 million talented and hard-working people hungry for prosperity ensures that nothing can hold this country back from growing,” P&G Pakistan’s chief said. While looking at the growing middle class, he said, it is important to look at their consumption habits. “We are exposing more consumers to value brands like Pampers and Always,” he explained.
It may be added here that consumer spending in Pakistan has increased by an average of 26% in three years, according to a Bloomberg report published on November 21, 2012 – a strong sign that people are consuming more goods than ever before.
This rise in consumer demand has spurred the growth of supermarkets across major urban centres, which include, but are no longer limited to Karachi, Hyderabad, Multan, Lahore, Faisalabad and Islamabad.
Such superstores are getting larger and asking manufacturers for broader brand portfolios in order to serve their customers better. They have larger shelves, enabling them to have more sophisticated and developed categories in which they can stock more products than ever before....

http://tribune.com.pk/story/567315/in-resilient-pakistan-emerging-m...

[Riaz Haq]

Most photographs in Pakistan depict something awful or its immediate aftermath: suicide bombings, a horrible earthquake, even more horrible floods, unimaginable grief. The Spanish photographerDiego Ibarra Sánchez, who made Pakistan his home for five years, saw something different amid all the tragedy: hope.

His latest project, called “Resilience, Pakistan,” is the culmination of small moments from his time there, until he left in 2014 after visa problems and intimidation by the country’s main spy agency. Mr. Ibarra divided this work into two categories: “Nightmare,” for the kind of images one expects from Pakistan, and “Hope,” for less frequently seen images of daily life, like a taxi driver in his car at night, young men playing pool, even a model at a fashion show.

“I started realizing that whatever happened, Pakistanis keep moving forward,” Mr. Ibarra said. “They don’t lose their hope, they don’t stop moving to the future. I thought it was my duty to show more, to show more than the terrorism, the nightmare, that there is hope for the future.”

Mr. Ibarra, 33, left Barcelona for Pakistan in 2009 almost on a whim. He won a photo contest for taking pictures at a mall, bought a secondhand lens with his winnings, went on a brief trip to Pakistan and then packed up his belongings to move there six months later.

He started working on “Resilience” almost immediately, but didn’t realize how his photographs knit together until 2010. Everywhere, he looked for hope. He started a workshop to teach survivors of acid attacks to take pictures, and he constantly reminded himself of how Pakistanis would rush to give him anything — biscuits, curry, tea — even when they had little of their own. Many of his photographs are moody, even dark, with shafts of light that highlight a man walking, or sitting in a jail cell.

Photo

Humayun Qureshi sailing his boat in Karachi, Pakistan.Credit Diego Ibarra Sánchez for The New York Times

“I’m always searching for this ray of light,” Mr. Ibarra said. “You know, after the storm, this ray of light that illuminates everything. This is what I’m trying to use, to explain, that no matter the nightmare there is hope.”

He walked the streets without security to take photographs, and after five years on the project, he said that the story remained unfinished and that he couldn’t pick a favorite image. “Each picture has its own moment, its own soul,” Mr. Ibarra said. “For me, each picture is some kind of gift.”

Some have a dramatic story behind them. In one, young men are silhouetted at night by fires raging after a Taliban attack on NATO supply trucks heading for Afghanistan. No one was killed in the blaze near the tribal agencies, but Mr. Ibarra, who didn’t have a permit to be there, had to flee when agents from the country’s main intelligence agency, Inter-Services Intelligence, or ISI, showed up in the early-morning hours.

There are also photographs of small acts of protest: a man nervously watching a movie in the Swat Valley, even though the Taliban loathe cinema.

Pakistan can be a maddening place to be a foreign journalist, as much of one’s effort goes toward figuring out how to work despite efforts by the government and the ISI to control stories and news events. It is a country where journalists are constantly followed, where they can be kicked out for seemingly innocuous reasons, where the daily grind of shaking someone from ISI can range between humorous and scary.

Photo

Girls playing at a school in the Afghan colony, on the outskirts of Islamabad, Pakistan. 2012.Credit Diego Ibarra Sánchez/MeMo

No one gets away unscathed: Mr. Ibarra started working with the New York Times Pakistan bureau chief Declan Walsh in 2012. Agents started following them. Shortly before Mr. Walsh was expelled in May 2013, Mr. Ibarra’s home was broken into in the middle of the night, and his mobile phone was taken from his jeans pocket, he said. After that, he said, every day there was a car in front of his home, waiting to follow him.

When Mr. Ibarra applied for a visa extension, he had problems.

In the beginning of 2014, agents visited his home and inexplicably took his television, a traditional Pakistani set, a blanket and some water taps, Mr. Ibarra recalled. He decided it was time to go. Mr. Ibarra then moved to Beirut, Lebanon, where he finished working on “Resilience,” a project he felt he couldn’t show while still living in Pakistan. The photographs are now visible on Mr. Ibarra’s website, and he is shopping for a publisher.

When asked about plans to return to Pakistan, a place he considered home, Mr. Ibarra initially said he wasn’t entirely certain.

“I’m not sure,” he said. “In a way, I would like to be back in Pakistan. I think there’s no finished story. You can always keep shooting, you can always keep adding, you can always spend more time.”

Then Mr. Ibarra thought about the idea a bit longer: “Of course, why not?” he said.

http://lens.blogs.nytimes.com/2015/04/14/picturing-hope-in-pakistan...