08-09 March 17. University of the Punjab Lahore

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1 08-09 March 17 University of the Punjab Lahore RIPP-Riphah International University Organized Technical Session on Industrial Policy to Drive Innovation and University Industry Linkages at Punjab University Summit

2 Summit Introduction: 6 th Invention to innovation summit was organized by IRP- Institute of Research Promotion and University of the Punjab Lahore, Riphah International University, University of Management & Technology Lahore, NUST Islamabad and others collaborative partners at Punjab University Lahore on March The summit aim was to bridging the gap among the universities, research institutes, public and corporate sector, developing culture of creating and sharing knowledge. Speaking at the occasion Mr. Ahsan Iqbal Federal Minister for Planning Development & Reform, Dr. Zafar Moeen, Vice Chancellor Punjab University Lahore, and Chairman Pakistan Foundation discussed the role of academicians, researchers, scholars, corporate consultants and institutes/organizations associated in various disciplines about innovation in science and technology in Pakistan. Speakers emphasis to promote high quality research culture including facilitating the processes of knowledge creation and sharing in PUNJAB is required to develop it. Mr. Abid Shairwani paid special thanks to Punjab University, Riphah International University and all other participating organizations on taking part in the summit by organizing special technical sessions and on presentation of projects at Exhibition. About 300 research expert participated in the summit and more than 50 stalls were exhibited in the summit by the students of various universities on science and technology innovations.

3 Technical Session by RIPHAH International University: One of the key technical sessions is organized by Riphah Institute of Public Policy, Riphah International University on Industrial Policy to Drive Innovation and University Industry Linkages. The session focused on the impact of various Government Policies applicable to various sectors and industries of Pakistan in General and Punjab in particular and way forward to improve the value chain through; efficiency, innovation, Research & Development, technology application, policy intervention, facilities and logistic support. Speakers also focused the economic growth of Punjab and its relation with Science Technology Innovation framework for the industrial clusters of the province.

4 Speakers: 1- Dr. Rashid Aftab Director RIPP Topic: Pro Innovation Industrial Policy 2- Mr. Raja Hussnain Javed Provincial Chief SMEDA Punjab Topic: SMEDA Policies to promote industrialization in Punjab 3- Mr. Ali Mukhtar ITC-UMT Topic: Concept of Trade Commercialization 4- Mr. Sami Yazdani PCMA Topic: Issues and challenges of Chemical Manufacturers in Pakistan 5- Dr. Ali Sajid LMS Topic: Importance of innovation in Industry

5 Dr Rashid Aftab: Presented Pro-Innovation Industrial Policy said Pakistan is still facing industrial policy issues, while Pakistan was 3.71 USD billion in 1960 which was more than South Korea but now Korean GDP is 1377 US Billion $ while Pakistan has 271 USD billion. He said this improvement in South korea is all about policy formulation but Pakistan has not achieved it due to proper policy of industrialization. He said During the 1960s, per capita incomes of Pakistan and South-East Asian economies were not very different. As a matter of fact, Pakistan was ahead of the South-East Asian countries both in the industrialization process and exports of manufactured goods. He said due to higher consumer tariffs, restriction on exports, high trade cost, drastically curtailed role of public sector, Pakistan has not yet completely transformed towards industrialization. He shared that Industrial Production in Pakistan increased 6.99 percent in December of Industrial Production in Pakistan averaged 5.24 percent from 1990 until 2016, while Pakistan s GDP from manufacturing is round about 15%. He said Labor productivity & skills is low while due Macro-economic concerns like Output and income, Unemployment, Inflation and deflation Pakistan is facing ecumenical and industrial growth issues. This is all due to Poor education and skills, insufficient links with dynamic firms & Poor access to finance.

6 Discussing the challenges Industrial activity has not been the growth engine it has been in fast-growing competitor economies, Industry needs to provide productive, well-paid jobs to our rapidly growing labor force & the linkage between domestic industry, skills development and science base in universities and research organizations is weak. Industry has not penetrated into the less developed regions of the country Therefore focus should be on Skills, Infrastructure Development, SME access to finance, technology, Investment climate (subnational strategies), and new events for growth, Relative prices & Policy coordination. For Infrastructure development the government may select few economic activities in consultation with private sector. The manufacturing sector, besides traditional industries of food, textiles and leather, Pakistan may focus on chemicals, electronics, electrical and non-electrical, machineries. Firstly, protection to various economic activities may be neutral and let the private sector decide where to invest. Secondly, with a view to providing equal effective protection rates to various sub-processes, proper cascading/flowing of tariffs would be ensured. Third, the basic raw materials and marginally processed raw materials and import of machinery may be duty free. Fourth, fiscal incentives may be used for diversification of activities towards those that have high growth potential. It needs to be underscored that diversification towards Hi-tech industries is not possible without S&T personnel, skilled workers and R&D institutions.

7 While the investment issues can be address by focusing the Consistency of Policy, Strong Macroeconomic Fundamentals, Deregulation and Privatization Policies, Law and Order Situation, Regulatory Environment, Tax Administration, Labor Policy, Financial Developments, Power Supplies, Communications & Transports. Mr. Ali Mukhtar: Presented ITC introduction and said ITC prepare businessman, managers, students, engineers and economic planners, traders and commerce men to meet the challenges of global knowledge economy and effectively take advantage of global knowledge based competitiveness shifting paradigm by developing a critical insight into global system of production and value creation. ITC Serve as a regional and international center of excellence for creating points of interaction to develop partnerships among Pakistan s and international business community in selected countries.

8 ITC has been inaugurated on Friday, April 1, 2016 at University of Management and Technology. ITC is a project of UMT that fosters global trade opportunities for stakeholders to bring economic prosperity. He said that there are areas such as service exports which are mainly untapped. The main reason for this is the lack of knowledge and awareness about the global knowledge based economy and competitiveness. This lack of knowledge in our businessmen and economists is causing a huge loss of global trade opportunities and Institute of Trade and Competitiveness will serve as a mile stone to fill this gap. ITC has an agenda to discover new markets, to access new technologies, to build new bridges, to strengthen entrepreneurs and entrepreneurship. ITC also undertaking research and Analysis of Pakistan s global export and international business development trends among Pakistan and other countries and will serve as a regional and international center of excellence for creating points of interaction to develop partnerships among Pakistan s and international business community in selected countries. Mr Sami Yazdani: Presented PCMA working at country level, he said PCMA Established in 2015, Licensed/Incorporated & Office established, SG in Nov 2015 while its Membership Increased to 64. PCMA First AGM Held in Jan 2017 & Audited Accounts got approved for PCMA organizes Training on Performance Management & Training on Energy Efficiency & Management.

9 PCMA is trying to have Liaison between Trade & Industry, industry & Academia, Exposure through fairs & exhibitions, Ease of doing business, Taxation & Audit issues, Custom Duties & Budget Proposals, Lobbying to Govt. on formation of Ministry for Chemicals & Petrochemicals. Mr Raja Hussnain Javed: Presented SMEDA working in Punjab, he Said Punjab s economy is mainly agricultural, although industry makes a substantial contribution. Punjab has many large industrial concentrations. Notable examples are Textiles, Leather and Light Engineering Goods. Punjab has more than 48 thousand industrial units. The small and cottage industries are in abundance. There are 39,033 small and cottage size industrial units. There are different pockets of industrial clusters spread across Punjab. The industrial establishments in Punjab comprise of a multitude clusters that variate in terms of geographical location, historical backgrounds and competitive labor skills. Over all Industrial Structure of Punjab is a combination of different Industrial SME Clusters. The SME Clusters in Punjab have huge potential for development that is critical to industrial growth of the province. SME Clusters in Punjab are specialized in production from low tech Cutlery Products to hi-tech Auto Parts, from Raw Vegetable and Fruits to value added Food Stuff and Juices from Handloom Textile Products to Modern Textiles, from Hand Stitched Footballs and Wooden Sports Goods to Mechanized Balls and Composite Material Sports Goods, from Traditional Carved Furniture to Modern Aesthetic Design Furniture and many more. The multitude

10 specialization in production of different goods geographically spread from Lahore to Sialkot, Faisalabad to Sargodha and Multan to Rahim Yar Khan. SMEDA has initiated an Industry Support Programme (ISP) since 2004 with the objective to transfer technical expertise and knowledge to local industry through involvement of International and Local Experts. SMEDA has been providing technical guidance and consultancy to industrial sectors in the areas of Productivity Improvement, Quality Assurance, Cost Reduction and Energy Efficiency. This Programme has been facilitating different industrial sectors including Textiles, Auto Parts, Foundry, Fan, Furniture, Jute, Leather Footwear, Food Processing etc. SMEDA stepped into the foray of Public Sector Development Program (PSDP) in by initially establishing four Common Facility Center projects, financed through PSDP window. These projects are conceived in consultation with prominent cluster stakeholders and aim to catalyze the adaptation of best business practices and induction of new technologies through demonstration, training, provision of common facilities and ancillary services. Currently SMEDA has a portfolio of twenty-eight projects with a total outlay of Rs. 4.2 Billion. Prof. Dr. Ali Sajid Education is the most powerful weapon in alleviating poverty, elevating economic growth, producing skilled human resource, creating a healthy and enlightened social environment and supplementing the industrial growth of a country. In a socially, economically, religiously and culturally diverse state like Pakistan, higher education institutions and universities, imparting education

11 and conducting cutting edge research, are the central mechanisms that can raise the declining industrial and economic infrastructure of the country. In the 21st century, the paradigm of universities has shifted from traditional aspects of teaching and learning towards building communities, economies and solving industrial problems. The Universities are fully capable of addressing the socio-economic challenging facing by the country and industrial competiveness. This can be effectively attained through the establishment of business incubation centers, encouraging partnerships between industry and academia and placing career counseling offices that should work on intellectual and professional development of the graduates during the course of their studies in order to their absorption in the industries. Further there is dire need to involve Professors in decision making process instead of bureaucratic system.

12 Recommendations: Export-Oriented Industrial Policy Tariff rationalization; Duty-free imported raw materials; Freight subsidy; Subsidies in the participation of fairs and exhibitions and holding specific fairs for Pakistan; Subsidy for introducing the products in the export market; the assistance of embassies in locating the demand for products. Viable EPZs and exploitation integrating with 29 industrial parks and 21 mineral economic processing zones of CPEC The country may invest in most of the activities, i.e., horizontal expansion. It may neither be feasible nor optimal as the country may not have comparative advantage in a particular product. Pakistan may select a few sectors for growth and leave it to the private sector to choose the optimal mix of activities. Second, in each of the industry more sub-processes may be added with the passage of time. Third, through improvement in quality, value of output of the same quantity may be enhanced. Fourth, investment plays a crucial role in growth process by not only adding to productive capacity but also by improving the technological base. Therefore, creation of a market-friendly business environment is absolutely essential. Cost/Ease of Doing Business may be reduced tangibly (138/89). Immediate implementation plan with responsibilities, accountability frameworks, assurance for resources and time line may be chalked out for STP. Intelligent planning for industrial development under CPEC may be undertaken.

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