Monday, May 21, 2018

History of Pakistan's Business and Industry

Pakistan's $1.1 trillion GDP ranks the country as the world's 24th largest economy in terms of purchasing power parity (PPP).  Pakistan has come a long way since independence in 1947 when it was a poor agrarian country struggling to survive. Business and industry sectors now account for more than half of Pakistan's economy while agriculture's contribution is down to 20% of GDP.

The story of the country's business and industry parallels the ups and downs in its national history. It is the story of business individuals and families dealing with uncertainties. It is also the story of how the captains of business and industry were impacted by major events in the nation's history, particularly the breakup of Pakistan and the creation of Bangladesh in 1971. It is the story of survival in the midst of political instability, policy discontinuities and the fight against terror in recent years. It is the story of how the businesses and industries thrived under pro-business rulers and suffered under anti-business governments. It is the story of how the country's economy has performed under pro and anti-business policies.

Pakistan Growth By Decades. Source: National Trade and Transport Facility

Captains of Industry:

The United States had Rockefellers, JP Morgans, Carnegies, Fords and others who built American business and industry. Japan has Hitachi, Honda, Mitsubishi and other big names credited with building its business and industry. South Korea is home to recognized global giants like Samsung, Hyundai and others. A handful of individuals and families, aided by their governments, have played outsized roles in industrialization and economic growth in most major economies.

Sitting L to R: Riaz Haq, Syed Babar Ali, Javed Patel, Sikandar Naqvi

The captains of business and industry neighboring India are also a few known large families including Ambanis, Birlas, Hindujas, Jindals, Mittals, Tatas, and a few others. They have contributed to economic growth in their country.

L to R:  Imran Qureshi, Nazim Kareemi, Husain Dawood, Riaz Haq, Farouk Ahmad

Pakistan had the so-called 22 families which began the process of industrialization in 1960s but they were devastated by the 1971 war.  What was left of their business and industry was nationalized by the PPP government led by Zulfikar Ali Bhutto  in 1970s. Many of these families have since recovered and rebuilt and several new ones have now emerged.  Their continued growth and Pakistan's economic progress depend largely on the continuity of business-friendly government policies in future.

Source: KASB Securities. Courtesy: Faseeh Mangi of Bloomberg News

Business and Industry in Pakistan:

Here are the top 11 publicly traded groups of companies listed on Karachi Stock Exchange. These groups make up a little over one-third of the total market capitalization of all the companies listed on the Karachi Stock Exchange.  The market caps here represent a snapshot and vary daily with stock trading:

 1. The IGI Group tops the KSE listed groups. Headed by Syed Babar Ali, it is a diversified conglomerate that includes IGI insurance, IGI Life, Packages Ltd and other businesses with a combined market cap of Rs. 677 billion making up 7.4% of KSE.

2. Dawood Group includes companies such as Engro Corp,  Engro Fertilizers, Engro Polymer, Engro PowerGen, Dawood Hercules, and Dawood Lawrencepur with a total combined market cap at Rs. 442 billion adding up to 4.8% of KSE.

3. Pakistani military's Fauji Foundation owns Fauji Fertilizer, Fauji Foods, Fauji Cement, Askari Bank, and Mari Petroleum. The Fauji Foundation Group has a total market cap of Rs432 billion, and a a total KSE share of 4.6%.

4. Mian Mansha’s Mansha Group includes MCB Bank, DG Khan Cement, Nishat Mills Adamjee Insurance, Nishat Chunian, Lalpir Power, and Nishat Power. It has total market cap of Rs. 408 billion, or 4.4% of KSE.

5. Habib Group includes Indus Motor Company, Thal Limited, Habib Insurance, Habib Sugar Mills, Bank Al-Habib, Habib Metro, and Shabbir Tiles. Total market cap for the group is Rs326 billion making up 3.6% of KSE.

 6. Bestway Group includes United Bank Limited (UBL) and Bestway Cement with total market cap of Rs. 310 billion, or 3.4% of KSE market cap.

7. Tabba Group has total market cap of Rs. 298 billion or 3.3% of KSE. The group includes Lucky Cement, ICI Pakistan and Gadoon Textiles.

8. The Atlas Group which includes companies such as Honda Atlas Cars, Atlas Honda, Atlas Battery, and Atlas Insurance has total market cap of Rs. 143 billion  or 1.6% of KSE.

9. Chinoy Group includes Pakistan Cables, International Industries, and International Steel. It has market cap of Rs. 90 billion or 1% of KSE.

10. The Saigol Group includes companies such as Pak-Elektron, Maple Leaf Cement, and Kohinoor Textile Mills.  It is worth Rs. 79 billion accounting for 0.9% of KSE.

11. JS Group includes Jahangir Siddiqui Company, JS Bank, Bank Islami, JS Investments, and JS Global. It is worth Rs. 43 billion or 0.5% of KSE.

In addition to publicly traded companies, there are several large highly valued privately held business and industry groups like Jang Group, Hashoo Group,  Bahria Town and others.

Dawood Group:

Dawood Group is the second largest among the top 11 publicly traded business groups which make up a third of the total market capitalization of the Karachi Stock Exchange.

In a keynote address at OPEN Forum 2018, the annual conference of Pakistani entrepreneurs in Silicon Valley, Husain Dawood of Dawood Group in Pakistan told the story of his family's business starting in 1947. This story is probably representative of most of the rest of business and industry groups in the country.

Seth Ahmad Dawood, the patriarch of the Dawood family, started his textile business in India before 1947. He lost everything when he fled to what became Pakistan after the partition of India. He rebuilt his business in both East and West Pakistan. The family lost half its business in what became Bangladesh in 1971. What was left of the business was confiscated by Zulfikar Ali Bhutto government in West Pakistan.

The Dawood family was able to rebuild its business under General Zia ul Haq's pro-business military government that followed after Zulfikar Ali Bhutto was deposed in a military coup.

The best days for Dawood Group came during General Musharraf's pro-business government in years 2000-2007 under Husain Dawood who took charge after his father Ahmad Dawood's death. He led the diversification drive from textiles into chemicals, foods, fertilizers, power and communications businesses.

Dawood Group invested $1 billion in world's largest fertilizer plant and took on a lot of debt. Musharraf government committed gas supply as incentive for the group to invest.  The PPP government led by Asif Zardari demanded payoff to deliver on the commitment to supply gas for the fertilizer plant. Dawood's refusal to pay off the PPP officials meant that the group's investment sat idle until 2013 when Nawaz Sharif's pro-business PMLN government came to their rescue.  Dawood group and other business and industry groups have thrived since 2013 with a pro-business government in charge.


Growth of business and industry in major American, European and East Asian economies has been led by a few large families aided by pro-business government policies.  Ford, Hitachi, Honda and Samsung are now household names but they all started small and built up in stable environments favorable to business. Pakistan had the so-called 22 families which began the process of industrialization in 1960s but they were devastated by the 1971 war.  What was left of their business and industry was nationalized by the PPP government led by Zulfikar Ali Bhutto  in 1970s. Many of these families have since recovered and rebuilt and several new ones have now emerged. Their continued growth and Pakistan's economic progress depend largely on the continuity of business-friendly government policies in future.

Related Links:

Haq's Musings

South Asia Investor Review

Who Owns Pakistan?

Pakistan Military Industrial Complex

Brief History of Pakistan Economy

OPEN Forum Silicon Valley 2018

Asian Tiger Dictators Brought Prosperity

Democracy vs Dictatorship Debate in Pakistan

Musharraf's Legacy

Is This a 1971 Moment in Pakistan's History?

Pakistan's Lost Decade of 1990s


Habibullah said...

The article gives a fair knowledge about the history of business development in Pakistan.In my opinion business development would have been much better if we had sincere and honest leaders running the governments,
who did not demand 10% to 50% commission from businessmen or those who obtained huge foreign loans and started only those projects which helped them in getting huge commission cuts!

Samlee said...

Sir Back In The 1960s Pakistan Even Had Adamjees,Fancy and Rangoonwalas.They Were Even Bigger Names.

Also Back In The 1960s Pakistan Was Perhaps The Only Third World Country That Could Produce Advanced Machine Tools.Please Google BECO and C.M Latif

Anonymous said...

Riaz Sb.,

A very interesting lecture on the history of Pakistan's economy in laymen's term was given by Dr. Kaisar Bengali.

The eye opening transcript is available at:


Riaz Haq said...

Thank you Zamir sahib.

Couple of interesting excerpts from Dr. Kaiser Bengali's lecture:

"As I said we started with less than a dozen manufacturing plants in Pakistan and they were also medium-sized manufacturing plants. One of them was Dalmia Cement Factory in Karachi. I remember that factory, it wasn’t functioning even when I first saw it but you could see that it was a very small old-fashioned kind of factory. The cement factories now are very technologically advanced but that was the kind of industrialization Pakistan had then. After we became independent, Pakistan was importing everything: toothpaste, toothbrushes, shoes, matchboxes, just about everything was being imported because we produced nothing. Even most food items were imported because we grew little. I remember in 1968, West Pakistan was not producing bananas; we couldn’t buy bananas in Karachi. So that was where we began, but by the end of the 50’s, we were producing a large variety of agricultural and industrial consumer goods."

"By the end of the 1950s, government offices were built up. In 1947 there were no government offices in Karachi. You probably hear your grandparents talking to you about how most government offices were operating out on the street. Residential housing was created; Pir Illahi Bux Colony and PECHS in Karachi were set up in 1950. Industrial and agricultural output had risen, and in fact by the end of the 1950’s, most of the very basic consumer goods were already being produced in the country like matchboxes, toothpaste and shoes and some textile units had already come up and we were producing cloth, etc. So there was some level of development that took place and we were no longer as deficient as we were a decade ago.

Then came the 1960s. The 1960s development effort moved into a higher gear. First of all the whole experience with the first 5 year plan: making the plan and implementing it, seeing the deficiencies, the flaws, the mistakes, and learning from them. Some people were sent abroad for training and they came back. One of them was Mehboob ul Haq. You know, he had gone abroad for his PhD, he came back. So there were some trained people who were now involved in the process of preparing plans. The fundamental thing that happened was that there was a planning board in the 1950s, which used to do the planning work with a minister for planning who headed it. In the 1960s, General Ayub Khan who was the President, created a planning commission with the president as its chairman. So you can see the political importance of this commission going up. From the planning minister now the president was actually chairing it and Ayub Khan was a very active chairman."

" So what happened since the 1990s? When you don’t invest, everything begins to creak; the infrastructure began to crack. And in the 1990s the growth rate began to decelerate. The governments in the 1990s also could not put money into investment and the rehabilitation of infrastructure because the debts that were incurred in the 1980s matured in the 1990s. And both Benazir’s and Nawaz Sharif’s governments had no fiscal space as they had to repay Zia’s debts. Every time the economic team met, the economic team meeting included the Finance Minister; the Secretary General Finance; the Secretary Commerce; Secretary Economic Affairs Division and Deputy Chairman, Planning Commission that’s the economic team all they discussed was when was the next payment due, and where will that money come from?"

Jon said...

Good to know but how did other other developing countries do and how did Pakistan perform relative to South Asia?
That will be a truer assessment.

Riaz Haq said...

#Pakistani giant #Engro to bet big on rising #middleclass in #Pakistan. Engro weighing acquisitions and starting new businesses in #agriculture, #healthcare, #realestate , #communications and other #consumer-linked sectors to profit from rising #incomes.

Pakistan’s chemicals-to-energy conglomerate Engro Corp has seen its fortunes rise on the back of massive Chinese investment, but plans to shape its future growth around the country’s vast population and expanding middle class, its chief executive said.

Engro Corp, best known for its fertilizer and petrochemicals factories, as well as engineering projects, is Pakistan’s largest listed conglomerate, and after recovering from a brush with bankruptcy in the early part of this decade is now sitting on a $500 million cash pile.

It has been a major beneficiary from Beijing’s Belt and Road Initiative splurge, working with Chinese firms on coal and power projects worth billions of dollars.

Engro’s rising fortunes since 2012, when its factories were crippled by gas shortages, mirror the improvements in Pakistan, a nuclear-armed nation where economic growth has accelerated due to vast Chinese investment and a sharp drop in militancy and power outages.

In the near term, Engro’s outlook is linked to a mile-long $1.5 billion coal mine in the Thar desert near the border with India, part of Beijing’s pledge to invest about $60 billion in Pakistan.

But with Pakistan’s new government hinting it may review Belt and Road contracts due to concerns they were too expensive, some analysts see risks on the horizon for Engro and say planned power plants around the mine may struggle to obtain financing.

Ghias Khan, Engro’s chief executive, told Reuters this week he was “pretty confident” the government would not re-open deals with sovereign guarantees.

“If they do, that will have a very negative impact,” Khan said.

This year Pakistan’s economy has also been shaken by a shortage of dollars, and speculation Islamabad may turn to the International Monetary Fund to ease current account pressures.


Undeterred by Chinese investment jitters and the recently wobbly economy, Khan said Engro was weighing acquisitions and starting new businesses in agriculture, healthcare, real estate, communications and other consumer-linked sectors to profit from rising incomes in the Muslim majority country of 208 million people, 60 percent of whom are aged under 30.

“We’ve come to a realization what has gotten Engro where it is today is not good enough for our next phase of growth,” Khan said in an interview at Engro’s ocean-front headquarters in Karachi, an Arabian Sea metropolis.

“What we are proud of is our ability to execute large-scale projects and put up large industrial complexes. But we are mindful we have to get into businesses which are more related to the population growth, and take us closer to the consumers.”

In Karachi, mushrooming shopping malls and ever-rising number of cars on the road point to a multi-year consumer boom as people’s disposable incomes have doubled this decade, analysts say.

Khan compared Pakistan’s current economic level, population growth and per capita income, which stands at about $1,600, to where China, South Korea and India were at earlier points in their development.

“If you look at sectors that did well when they were where Pakistan is today ... like real estate, automobiles, healthcare, logistics - everything is somehow related or linked to population growth or the middle class,” Khan said.

Riaz Haq said...

#Pakistan’s centuries-old ‘zero-waste’ movement. The Memon predisposition towards frugality is iconic, but they celebrate their stereotyping as an achievement; a tribute to their enduring prosperity and resilience. #environment #zerowaste via @BBC_Travel

As I circled to find a parking spot, I was awestruck by the stately mansion in the upscale neighbourhood of Karachi. Casually, my sister-in-law remarked that the equally impressive estate across the road also belonged to Bilquis Sulaman Divan, the Memon (an ethnic sub-group of Sunni Muslims) and ex-colleague of hers that we were visiting. Flanked by perfectly manicured hedges, the home’s colonial architecture and sprawling, expansive gardens spoke of affluence and hinted at greater opulence within.

But on approaching, we were marched straight past the grand main entrance and guided instead to a simple room crammed with the necessities of life, including a ramshackle sewing machine by the door, threadbare sofas and an ancient refrigerator.

Although Divan and her sister – who also live with her sister’s husband and their adult daughter – have almost incalculable wealth, as owners of a bottle manufacturing plant and heiresses to their late father’s fruit-exporting company, they choose instead to spend most of their time not in the mansion’s grand rooms, but in one small living quarter. The rest of the estate has been rented out to an elite private school, which is where Divan and my sister-in-law worked for more than two decades.

Why, despite such abundance, did these people live so frugally, I wondered?

Divan and her family are not the only ones. As I would soon learn, the entire minimalist Memon community takes pride in pinching pennies.

The concentration ­and preservation of wealth, as the last vestiges of power and dominion that the displaced Memons clung to, has been integral to their quest for identity. And while safeguarding their security through financial stability has become second nature to the Memon diaspora, the Memons of Karachi have an especially interesting – and successful – story.

Part of what sets the Memons of Karachi apart from their Indian counterparts is the memory of the harrowing time of Partition in 1947. While the Memons who stayed in present-day India continued to have access to the established businesses and industries of their forefathers, those who uprooted their businesses and migrated had to start from scratch, setting the family’s financial status back by years, if not generations.

“My grandfather came to Pakistan, literally barefoot, asking people for work. He built his empire slowly and diversified. From childhood, we’re instilled with an awareness – and understanding – of the value of hard-earned money. It’s part of our daily narrative. It’s how we survived. And we take care to give back,” said Anila Parekh, granddaughter of the late Memon industrialist and philanthropist Ahmed Dawood.

For the Memons of Karachi, each “paisa” (Memoni for “money”, but also the Urdu word for “cent”) accumulated and saved is an ode to trials that they overcame. Although they now control the majority of many business sectors in Pakistan, including the textile industry, education sector, fertiliser industry and financial securities, respect for money is deeply engrained in Memon ethos, making for a thrifty legacy that they take pride in preserving.

“It’s not ‘don’t spend’ – it’s ‘don’t waste’,” clarified Nadeem Ghani, a Memon and dean of Academia Civitas and Nixor College, an elite school and college in Karachi. “Being frugal,” he said, “has an element of humility. It’s a manifestation of respect. We don’t shy away from placing a monetised value on our comfort.”


Her final words were straight to the point: “Turn off the light before you leave the room.”

Riaz Haq said...

Philanthropist Syed Babar Ali honored in #UnitedStates as a member of the American Academy of Art and Sciences in recognition of his efforts for creating #Lahore University of Management Sciences (#LUMS) a premier business institution of #Pakistan.

The American Academy of Arts and Sciences is one of the oldest learned societies in the United States. Founded in 1780, the Academy is dedicated to honoring excellence and leadership, working across disciplines and divides, and advancing the common good.

Syed Babar Ali received his education from Aitchison College in Lahore. For further studies, he went to the Michigan University at Ann Arbor until 1947 when he moved to newly-created state Pakistan. He completed his graduation from Punjab University (PU). He also briefly studied at Harvard School of Business, which later helped him in creating a business institution in Pakistan.

He created and grew Packages Ltd, Milkpak Ltd, Tri-pack Films, and the IGI Group. He brought several foreign companies to Pakistan, including Nestle (Switzerland), Tetrapak (Sweden) and serves on the board of Coca Cola Pakistan, Siemens Pakistan, and Sanofi-Aventis.

He also promoted the cause of the World Wide Fund (WWF) for Nature where he served in various positions, both in Pakistan and internationally, from 1972 to 1996. He was the international president of WWF from 1996 to 1999, succeeding Prince Philip, Duke of Edinburgh.

The American Academy of Art and Sciences was founded during the American Revolution by John Adams, John Hancock, James Bowdoin, and other Founding Fathers of the United States.

Today the Academy is charged with a dual function: to elect to membership the finest minds and most influential leaders, drawn from science, scholarship, business, public affairs, and the arts, from each generation, and to conduct policy studies in response to the needs of society.

Major Academy projects now have focused on higher education and research, humanities and cultural studies, scientific and technological advances, politics, population and the environment, and the welfare of children. Dædalus, the Academy's quarterly journal, is widely regarded as one of the world's leading intellectual journals.

Riaz Haq said...

Interloop CSR Case Study In Swiss dissertation at Business University of Lausanne

With increased awareness concerning societal challenges, organizations around the globe have started realizing their responsibility towards the social and environmental concerns in addition to their economic challenges. Among these companies is also Interloop Limited, located in the sub‐continent region of South Asia, Pakistan. Interloop is an unlisted public company with majority shares owned by one family. The company is one of the world’s largest sock manufacturers and exporters with hosiery being its core business. It has an annual turnover exceeding $250 million (Company Business, 2014). Besides hosiery, Interloop is a reputed manufacturer of quality yarn. It is a vertically integrated organization with in‐house spinning, yarn dyeing, knitting and finishing facilities. Interloop Limited was established in 1992 with only 10 knitting machines on the floor but currently, Interloop houses over 3,500 knitting machines, 46,704 ring‐spinning spindles and has more than 13,000 employees (Company Business, 2014). The Company offers a wide range of socks with various quality levels and price points in line with all types of customers including brands, retailers and specialty stores, in addition to its quality yarns for denim, hosiery and the weaving industry.
In‐house designing, product development facilities and a recently established Research & Innovation Center, with a team of technical experts, have paved the way to serve Interloop customers' needs well in time. Being a full service supplier, Interloop offers a unique set of services besides offering a quality product. This includes, but is not limited to market intelligence, trend projections, product design and development support, VMI3 (Vendor Managed Inventory) services and distribution centers offering pick and pack services across the Globe (Company Business, 2014). This unique combination of product and service differentiates Interloop from the rest of the textile companies in the world and hence Interloop has the privilege of providing services to such leading retailers as JCPenny, H&M, SportMaster, Tesco, C&A, Penney, Primark,

MOU with The Citizens Foundation: For CSR purposes, Interloop cooperates with non‐profit organizations
(NPOs) which are doing something worthy for the development of the nation and which are sustainable
themselves (Interview Zulqarnain). An important achievement in this regard is the establishment of 14
schools, for less privileged children, in collaboration with a Non‐Profit Organization, The Citizens Foundation
In 2009, Interloop signed a Memorandum of Understanding with TCF which is Pakistan’s leading non‐profit
organization in the field of formal education. This was another social welfare contribution which marked
Interloop as an ethically and socially responsible organization in the minds of both the internal and external
stakeholders. Initially, 4 schools were built again in collaboration with Dobotex International and later the
number of schools increased over a period of time. Interloop proudly owns this contribution and gladly
expresses its efforts for providing quality education to the less privileged in its newsletters as well.

Riaz Haq said...

PARCO has built and supported three schools with The Citizens Foundation (TCF) – a reputable NGO working in the area of imparting quality education – at Karachi and Qasba Gujrat, near PARCO Mid-Country Refinery. These schools employ all female staff belonging to the nearby communities. These campuses have generated employment for the local women to earn a decent living.

Amongst the above mentioned three campuses, the PARCO–TCF Campus I at Karachi and Campus II at Qasba Gujrat offers education till Grade V and are operating at full capacity. The PARCO-TCF Campus I at Karachi operates morning and afternoon shifts. In August 2012, the Company extended academic block of PARCO-TCF Primary Campus II to accommodate 180 students.

PARCO has built a third campus, a secondary school in Qasba Gujrat which commenced classes in April 2011. All PARCO-TCF campuses are built in under-privileged communities and impart quality education to around 1,080 children.

Riaz Haq said...

Pakistan State Oil Company Limited (PSO), the largest oil marketing company of Pakistan, has donated Rs 12 million to The Citizen’s Foundation (TCF), one of Pakistan’s leading not-for-profit in the education sector. The announcement came at a ceremony organized by PSO where MD and CEO PSO, Sheikh Imranul Haque, presented the cheque of support to the Co-founder TCF, Mr. Mushtaq Chhapra. Chairman, PSO CSR Trust, Mr. Yacoob Suttar was also present on the occasion with other officials from both organizations.
Pakistan continues to face an education emergency. Statistics suggest almost 44% (22.6 million) children between the age of 5 and 16 are out of school. PSO CSR Trust’s donation to TCF will ensure continued provision of education for deserving students from some of the most underprivileged backgrounds. Under the support agreed with TCF, PSO is adopting five TCF campuses, also constructed with PSO support, for a period of one year. Three out of five schools are located in areas hit by the terrible 2008’s earthquake.
Other than the above donation, PSO has also pledged construction of a TCF campus in one of the underdeveloped localities of the country. Member, PSO CSR Trust, Mr Baber Hamid Chaudhary and the Vice President, TCF, Mr. Zia Akhter Abbas, also signed a memorandum of understanding to confirm the support. Senior officials from both sides attended the ceremony.
Speaking at the ceremony, Sheikh Imranul Haque, MD & CEO, PSO said:
“Millions of children in Pakistan remain out of school. This brings a huge responsibility on every one of us to ensure access to education for our children. A well-educated population is important to boost the economy, broaden their outlook, and to ensure a bright future for our country.”

Riaz Haq said...

Companies which lead CSR activities in Pakistan
Some of the local and international enterprises have realized their roles concerning CSR activities in Pakistan. Let’s have a look at how they are contributing to the cause, here in Pakistan.

1- Unilever’s role in CSR activities in Pakistan
One has to appreciate the efforts of Unilever Pakistan in this regard. Its Sustainable Living Plan outlines some key goals which are crucial to development in Pakistan. The environment is in focus majorly, as efforts are envisioned which will eventually reduce the carbon footprint in Pakistan. Known as talent hunters globally, Unilever’s employment policies constitute a major percentage of its CSR activities. However, Unilever is fully aware of the moral obligations associated with such policies. This is why we haven’t come across any cases where the corporation was accused of exploitation.

Although many remain unaware of this, Unilever is the key leader of many CSR activities in Pakistan. You might remember one such example from the advertisement called Madad aik Ibadat. A popular detergent company was the key partner in this initiative. This campaign, which still goes one as we speak, is a part of Unilever’s Sustainable Living Plan.

2- PTCL’s efforts to promote CSR activities in Pakistan
Pakistan Telecommunication Company Limited has also set certain goals concerning social and environmental issues in Pakistan. The much-famed telecommunication company actively participates in several CSR activities in Pakistan. The major focus at PTCL revolves around health, education, environment and community service projects.

The tree-plantation drives at PTCL reflect the efforts to preserve the environment. There are also programs for children, which aim at improving children’s character and making them responsible citizens. Human resource management at any company is indicative of how employees are treated there. The agreement which PTCL made with Collective Bargaining Agent- CBA has benefitted its employees most fruitfully.

There are several other CSR activities in Pakistan in which PTCL engages actively. These include medical services for employees, blood donation drives and post-retirement beneficial schemes.

3- How Coca Cola highlighted the need for increased CSR activities in Pakistan
Bottle of change was a campaign that aimed at fundraising for Pakistan’s biggest social welfare service, The Edhi foundation. The brand leader for this mega CSR activity in Pakistan was Coca Cola. The most amazing feature of this campaign was Coca Cola’s paramount interest. The brand promised that it will double any donations it received during this fundraiser. Women Entrepreneurship Program, a gold winner at SABRE gold awards 2016, is another hallmark of Coca Cola’s CSR activities.

These two fine examples show that Coca Cola is a key leader in CSR activities in Pakistan. It will be wondrous if more companies could follow the suit!

4- MCB’s major contributions in CSR activities in Pakistan
It would be unfair, not to mention the contributions of MCB in this regard. Several Corporate Social Responsibility activities in Pakistan wouldn’t have been possible, had it not been for MCB’s active participation. These activities target various aspects of governance, culture, sports, health, and education.

Riaz Haq said...

#Karachi-based Denim-Maker Artistic Milliners Makes $370M Investment in #Hydropower Projects in #Pakistan demonstrating commitment to sustainability. It will also include the development of wind and solar projects, as well as an operational #wind farm.

Karachi, Pakistan-based denim manufacturer Artistic Milliners further demonstrated its commitment to sustainability with a $370 million investment in two run of river hydropower projects.

Artistic Milliners’ hydropower plants, Hydro I and Artistic Hydro II, will contribute a combined 521 GWh per year. According to Italian energy company ERG SpA, that’s enough energy to meet the demand of more than 133,000 homes. Both plants are located in Khyber Pakhtunkhwa province, with Artistic I Hydro pulling from the Panjkora River and Artistic II Hydro pulling from the Ushu River.

The project will also include the development of wind and solar projects, as well as an operational wind farm.

Regulatory authorities are currently processing generation licenses and tariffs needed for the projects, and commercial operation is slated to begin by December 2027.

According to the International Hydropower Association, renewable hydropower is a clean and low-cost source of electricity generation and responsible water management. Specifically, run-of-river hydropower channels flowing water from a river to spin a turbine. This form of energy uses water flow that is regulated by the facility for a continuous supply of electricity. It’s currently a significant energy source in Pakistan, representing around 25 percent of capacity and 21 percent of generation.

This investment is part of Artistic Milliner’s overall commitment to the land in which it operates. At the end of last year, Artistic Milliners launched the Milliner Cotton Initiative, a call for visibility and women empowerment throughout the cotton supply chain. It also encompasses capacity building for ginners and promotes practices for mitigating extortion throughout the Rahim Yar Khan district of Punjab, Pakistan.

Artistic Milliners is also the first and only Pakistan-based company to abide by the United Nations’ 1.5°C-compliant business model to help mitigate the climate crisis. It has aggressive sustainability targets in place to reach net zero emission by 2025.

Riaz Haq said...

One Pakistani Institution Places His Faith in Another

“You can’t build a country if you’re not thinking beyond your own lifetime,” Syed Babar Ali said. Pakistan’s biggest problem, he believes, is one of leadership.

SYED BABAR ALI, a businessman and philanthropist, is two decades older than his country, Pakistan. He has witnessed every turn in its tumultuous history. Now, at 83, he feels he has earned the right to give it a bit of advice.

Mr. Ali is an institution in Pakistan. He has started some of the country’s most successful companies. But perhaps his most important contribution has been his role in creating the Lahore University of Management and Science, or L.U.M.S., begun as a business school but now evolved into the approximate equivalent of Harvard University in Pakistan.

Pakistan’s biggest problem, he believes, is one of leadership. A corrosive system of privilege and patronage has eaten away at merit, degrading the fabric of society and making it more difficult for poor people to rise. The growing tendency to see government positions as chances to profit, together with the explosion in the country’s population, has led to a sharp decline in the services that Pakistan’s government offers its people.

“Nobody is bothered about the masses,” Mr. Ali said.

It did not start that way, he says. Muhammad Ali Jinnah, Pakistan’s visionary founder, criticized Pakistan’s system of feudal power, in which rich landowners reaped profits from land worked by impoverished peasants, calling the system “vicious” and saying it made the rich “so selfish that it is difficult to reason with them.”

Pakistan was created as a haven for the Muslim minority of the Indian subcontinent, but Mr. Jinnah was adamant that the country should protect all faiths and be a fair society, where the poor, through hard work, could advance themselves.

But 62 years later, many of those ideals seem just as distant. Attempts at dismantling the feudal system were halfhearted, and decades later it is still more or less intact and landowners still form the bulk of the political elite. Other powerful groups that have governed, the military and wealthy industrialists, fared no better.

“You can’t build a country if you’re not thinking beyond your own lifetime,” Mr. Ali said.

Pakistan’s education system has been one of the casualties. Good public education can create opportunity in societies, but in Pakistan it has been underfinanced and ignored, in part because the political class that runs the country does not consume its services. Fewer than 40 percent of children are enrolled in school here, far below the South Asian average of 58 percent. As a result, Pakistan’s literacy rate is a grim 54 percent.

For Mr. Ali, education was the country’s most urgent need, and in 1986 he helped create L.U.M.S. Founded as a business school, it later added a rigorous liberal arts program, one of the strongest in Pakistan. Breaking with the tradition of rote learning, the school encourages its professors, many recruited from abroad, to foster debate in classes, and its graduates tend to be critical thinkers with open minds.

These days the university attracts many offspring of wealthy Pakistanis, who would otherwise have gone to the United States or the United Kingdom for their undergraduate studies.

THAT was the case for Mr. Ali, who was studying at the University of Michigan in 1947, the year Pakistan became a state. He returned to Pakistan in December of that year, ultimately earning his bachelor’s degree from Punjab University in Pakistan, but he kept his ties with the United States. His brother later became Pakistan’s ambassador in Washington, and Mr. Ali’s wedding was held in the embassy there — benefits bestowed by a system he now criticizes. The ceremony was attended by Richard M. Nixon, then the vice president, and was photographed for Life magazine.

Riaz Haq said...

UNDP: Elite privilege consumes $17.4bn of #Pakistan’s #economy. Top beneficiaries are corporate sector (tax breaks, cheap input prices, higher output prices, access to capital, land) – 2nd & 3rd biggest recipients of privilege are richest feudal landlords

The UNDP’s Wignaraja noted that this creates a paradox where those responsible for doling out the privileges were also those who were receiving them.

The biggest beneficiary of the privileges – which may take the form of tax breaks, cheap input prices, higher output prices or preferential access to capital, land and services – was found to be the country’s corporate sector, which accrued an estimated $4.7bn in privileges, the report says.

The second and third-highest recipients of privileges were found to be the country’s richest 1 percent, who collectively own 9 percent of the country’s overall income, and the feudal land-owning class, which constitutes 1.1 percent of the population but owns 22 percent of all arable farmland.

Both classes have strong representation in the Pakistani Parliament, with most major political parties’ candidates’ drawn from either the feudal landowning class or the country’s business-owning elite.

Economic privileges accorded to Pakistan’s elite groups, including the corporate sector, feudal landlords, the political class and the country’s powerful military, add up to an estimated $17.4bn, or roughly 6 percent of the country’s economy, a new United Nations report has found.

Released last week, the UN Development Programme’s (UNDP) National Human Development Report (NHDR) for Pakistan focuses on issues of inequality in the South Asian country of 220 million people.

The report uses the prism of “Power, People and Policy” to examine the stark income and economic opportunity disparities in the developing country.

“Powerful groups use their privilege to capture more than their fair share, people perpetuate structural discrimination through prejudice against others based on social characteristics, and policies are often unsuccessful at addressing the resulting inequity, or may even contribute to it,” says the report.

Kanni Wignaraja, assistant secretary-general and regional chief of the UNDP has been on a two-week “virtual tour” of Pakistan to discuss the report’s findings, holding talks with Prime Minister Imran Khan and other top members of his cabinet, including the ministers of foreign affairs and planning.

She says Pakistani leaders have taken the findings of the report “right on” and pledged to focus on prescriptive action.

“[In our remarks in meetings] we focused right in on where […] the shadows are, and what is it that actually diverts from a reform agenda in a country,” she told Al Jazeera in an exclusive interview.

“My hope is that there is strong intent to review things like the current tax and subsidy policies, to look at land and capital access.”


The country’s powerful military, which has directly ruled Pakistan for roughly half of its 74-year history, was found to receive $1.7bn in privileges, mainly in the form of preferential access to land, capital and infrastructure, as well as tax exemptions.
The report noted, however, that Pakistan’s military is also “the largest conglomerate of business entities in Pakistan, besides being the country’s biggest urban real estate developer and manager, with wide-ranging involvement in the construction of public projects”.

“These things are not neatly separate entities,” said Wignaraja. “You do see some of… these are overlapping so you almost get a double privilege by the military. The minute in a country the military is a part of big business, it obviously doubles the issue and the problem.”

In a country like Pakistan, where the military continues to hold power over many aspects of governance, she warned that it would take “almost a social movement” to displace structures of power that were so entrenched.

Riaz Haq said...

Engro to establish petrochemical plant
Unit will help slash country’s chemical imports, boost exports

Engro Corporation, a diversified group of companies, has announced that it will undertake advance studies for setting up a manufacturing plant in the petrochemical sector at an estimated cost of over $1 billion, which will slash Pakistan’s chemical imports and give a push to exports.

The conglomerate intends to establish a plant for the manufacturing of polypropylene resin, which is used in making plastic bags for carrying and supplying fertiliser and sugar to the market, confectionery wrappers, plastic pipes and other construction fitting material, film and sheet.

“We are pleased to announce that the board, in its meeting held on April 8, 2021, has approved an amount of up to $31.4 million (approximately Rs4.8 billion) towards conducting engineering, design and technical studies including a front-end engineering design (FEED) study in relation to the PDH-PP (propane dehydrogenation-based polypropylene) project,” Company Secretary Shomaila Loan said in a notification to the Pakistan Stock Exchange (PSX) on Friday.

“At present, Pakistan meets local requirement for the chemical by importing approximately 500,000 tons a year,” Engro Corporation President and CEO Ghias Khan told The Express Tribune in an interview in December 2020.

The company was considering setting up a global-scale plant with installed capacity of 550,000-750,000 tons a year, he said and added that the estimated cost of the project could be around $1-1.2 billion.

The demand for the chemical is growing at 7.5% per annum. Keeping in view the project studies, arrangement of financing, potential investment partners (if considered) and construction, the plant would consume six to seven years for development and start of commercial production, he said.

“We may arrange financing for the project in two years from the time the board gives its go-ahead for the plant,” he said.

“The company will seek investment opportunities in this area, which creates avenues for both substituting imports and enhancing the export potential, which will help in building foreign currency reserves of the country,” said a company notification issued in April 2019. Khan said that the company would import raw material (propane gas) to produce polypropylene resin locally.

“The project will save Pakistan a net $250-300 million annually,” he said. Besides, the company might consider exporting the surplus production. Neighbouring country China was a big importer of resin globally, he added.

“Results of these studies, when completed, are expected to lead towards the final investment decision in relation to this project,” Loan said in the notification.

“The decision will also be based on a conducive policy environment and arranging the right mix of debt and equity partners at such time.”

The corporation’s share price dropped 3.08%, or Rs9.44, to close at Rs297.49 with trading in 1.3 million shares at the PSX.


KBR, Inc. KBR announced that it has entered into an agreement with JS Energy Limited. Per the agreement, KBR’s K-PRO™ Propane Dehydrogenation (“PDH”) technology will help JS Energy to convert propane into propylene for a PDH project in Pakistan, which is anticipated to be commissioned in 2024. However, financial terms of the agreement have been kept under wraps.

In 2019, KBR introduced K-PRO that offers propylene selectivity and conversion. K-PRO is a revolutionary step for the PDH industry that furnishes innovative designs at a very low cost of capital. Also, K-PRO's proprietary catalyst doesn’t require high-cost metals and pollutants, consequently resulting in an ideal environment and lower business overhead.

Riaz Haq said...

Engro Polymer & Chemicals Limited (EPCL) is the sole manufacturer of PVC resin in Pakistan. Besides this, the company also produces Chlor Alkali products like Caustic Soda, Sodium Hypochlorite and Hydrochloric Acid.

It is a subsidiary of Engro Corporation, involved in the manufacturing, marketing, and distribution of PVC under the brand name ‘SABZ’ and other quality Chlor-Vinyl allied products.

Engro Polymer and Chemicals is Pakistan’s multi-billion-dollar company, which saw the highest every profitability since its establishment in 1997. In its IPO, Rs. 3 billion shares were issued, and the company’s IPO was oversubscribed by 5.4 times.

Its PVC plant has a capacity of 295 Kilo Tons per Annum (KTA) (after expansion) while EDC and VCM have the respective capacities of 127 and 204 KTA.

South Asia has been one of the crucial markets in the vinyl world due to its supply deficits both for PVC and feedstocks. With the high population growth, the market of PVC is expected to grow, especially in the construction sector.

Especially, keeping in mind the government’s focus on affordable housing, expected improvement in economic growth the country’s per capita PVC consumption is expected to increase in the years to come and converge towards international levels.

Keeping the same view in mind, AKD Securities has also predicted an upward trend in the price of EPCL, due to increased PVC Ethylene margins and EPCL’s new expansion of 50 percent of the existing plant’s capacity.

According to the AKD analysis, “the PVC ethylene margins have recently surpassed ~US$1,000/MT in Mar’21 on the back of force majeure declared by PVC capacities in the US and, soft ethylene prices amid a recent wave of global capacity expansion resulting in excess ethylene supply.”

All of this is coming at an optimum time for EPCL as its new expansion of PVC capacity by 100K tons that went online on 1st Match and debottlenecking exercise for VCM (Vinyl Chloride Monomer), a gas used in the production of PVC will enable the company to meet the demand in the market.

EPCL being the sole supplier in Pakistan caters to 70 percent of local PVC demand. The supply sector has been hugely hurt due to lockdown around the world driving the prices of PVC up. This has thus led to a bull cycle in PVC prices which are up 100/30% FYTD/CYTD.

Riaz Haq said...

Product made from polymers are all around us: clothing made from synthetic fibers, polyethylene cups, fiberglass, nylon bearings, plastic bags, polymer-based paints, epoxy glue, polyurethane foam cushion, silicone heart valves, and Teflon-coated cookware. The list is almost endless.,The%20list%20is%20almost%20endless.

Polymers are widely used advanced materials, which are found almost in every material used in our daily life. To date, the importance of polymers has been much more highlighted because of their applications in different dominions of sciences, technologies and industry – from basic uses to biopolymers and therapeutic polymers. The main aim of this editorial is to accentuate the pragmatic impacts of polymers in human daily life.

Keywords: Macromolecule, Monomer, Natural polymer, Polymer, Synthetic polymer
The polymers, a word that we hear about it a lot, is very vital and one cannot imagine the life without it. Polymers, a large class of materials, consist of many small molecules named monomers that are linked together to form long chains and are used in a lot of products and goods that we use in daily life.1

Since many years, people used polymers in their life but they did not know it well almost until World War II. There were relatively few materials available for the manufacture of the article needed for a civilized life. Steel, glass, wood, stone, brick, and concrete for most of the construction and cotton, wood, jute, and a few other agricultural products for clothing or fabric manufacture were used.

The rapid increase in demand for the manufactured products introduce the new materials. These new materials are polymers, and their impact on the present way of life is almost incalculable. Product made from polymers are all around us: clothing made from synthetic fibers, polyethylene cups, fiberglass, nylon bearings, plastic bags, polymer-based paints, epoxy glue, polyurethane foam cushion, silicone heart valves, and Teflon-coated cookware. The list is almost endless.2

The word “polymer”, or sometimes "macromolecule", is derived from classical Greek poly meaning "many" and meres meaning "parts". The polymer molecule has very high molecular weight (between 10 000-1000 000 g/mol) and consists of several structural units usually bound together by covalent bonds.1,3

Polymers are obtained through chemical reaction of monomers. Monomers have the ability to react with another molecule from the same type or another type in the suitable condition to form the polymer chain. This process in nature has resulted to the formation of natural polymers, while the synthetic polymers are man-made.

Polymers have been around us in the natural world since the very beginning (e.g., cellulose, starch, and natural rubber). Man-made polymeric materials have been studied since the middle of the nineteenth century. Today, the polymer industry has rapidly developed and is larger than the copper, steel, aluminum and some other industries combined.4

Both natural and synthetic polymers are remarkably involved in comfort and facilitation of human life and are responsible for life itself, for medication, nutrition, communication, transportation, irrigation, container, clothing, recording history, buildings, highways, etc. In fact, it is difficult to imagine human society without synthetic and natural polymers. In our ever-increasing technological world, science plays a crucial role in providing solutions to critical problems of food, clean and abundant water, air, energy, and health. The knowledge of polymers and related texts provide both the information and insights of their better understanding in our life. The information collected from the basic science courses lead to understanding the polymers.

Riaz Haq said...

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Pakistani Beverages (1/3)
Pakola was the creation of seven brothers from the Teli family of Dhoraji in India who migrated to Pakistan in 1947. The idea of Pakola came from its founder Haji Ali Mohammad, who dreamed of developing a drink that portrayed the true reflection and taste of Pakistan. In order to pursue his dream, Haji Ali Mohammad opened a small factory with only two machines at Lawrence Road in Karachi, Pakistan with Pakola Ice-cream Soda being the initial product.
The drink was launched at Pakistan Air Force base on the anniversary of Pakistan’s Independence, 14 August 1950, in the presence of the first Prime Minister, Liaquat Ali Khan.
Later when Pakistan Beverages (PB) came into existence at SITE (Karachi), the brand Pakola was produced there. In 1979, when Pakistan Beverages location was announced as a production facility for Pepsi, Mehran Bottlers came into existence and continued to produce the drink along with other products such as Apple Sidra and Bubble Up.
Pakola is now available in America, Africa, Australia, Canada, Middle East, New Zealand and the United Kingdom. It is the only carbonated beverage manufactured in Pakistan that is exported globally.

Riaz Haq said...

PABC raises Rs4.6b through IPO
Can maker secures maximum allowed price of Rs49 per share

Pakistan Aluminium Beverage Cans (PABC) raised Rs4.6 billion by selling one-fourth of the stake in the company to institutional, individual and retail investors at the Pakistan Stock Exchange (PSX) on Wednesday.

The company secured the maximum allowed price of Rs49 per share, which it determined by holding the Dutch auction (book building process) on Tuesday and Wednesday. It kick-started the auction at the minimum (floor) price of Rs35 per share.

Rules in place allowed the company to sell shares at 40% higher price against its floor price of Rs35 per share. The company sold a total of 93.88 million (26%) shares in the auction at the PSX.

The IPO was oversubscribed by 2.5 times at 233.23 million shares against the offer to sell 93.88 million shares.

It was the second largest initial public offering (IPO) in the private sector in terms of size of raised funds at Rs4.6 billion.

Funds gathered through the listing would go to UK-based asset management firm Ashmore that plans to break away from the company. It held a total of 51% stake in the company, out of which it sold almost half (26%) through the auction at the PSX.

Ashmore has also entered into agreements to sell rest of its holding in the company at a price of Rs30.80-31.85 to two major investors including Hamida Salim Mukaty (part of Liberty Group) and Soorty Enterprises (Private) Limited in private deals. PABC has shared plans to enhance its annual capacity from 700 million cans to 950 million cans. It aims to complete the expansion by July 2022.

The expansion is being financed through the State Bank of Pakistan’s (SBP) Long Term Financing Facility (LTFF) at an attractive rate of 3% (inclusive of bank margin of 1%). The company has established relationship with key beverage bottlers in Pakistan and Afghanistan such as PepsiCo, Coca Cola, Mehran Bottlers (Pakola) and Zalal Mowafaq, Afghanistan.

In addition to this, the company also supplies aluminium beverage cans to Nestle Pakistan, Murree Brewery, King Beverages, Super Cola Beverages, Sufi Group of Companies, Six B, Daani International, Master Beverages and Foods and Afghan Red Pomegranate.

As per company estimates, the can penetration in the beverage packaging market is roughly 3-4%.

The off-trade consumption in soft drinks market of Pakistan stood at 3.13 billion litres in 2020 and it is expected to hit 4.34 billion litres by 2025, registering a five-year CAGR of 6.7% on volume basis, as per Euromonitor International.

Riaz Haq said...

Pakistan’s Fatima Group inks $1 billion deals with global agriculture giants at Expo 2020 Dubai

CMEC as a technology partner, will help with the adaption of climate-smart precision agriculture farm machinery, improved high-yielding seeds, and other crop inputs in Pakistan. In addition, Sarh Attaqnia Company is a key partner that will invest in developing a state-of-the-art agriculture value chain encompassing sustainable production, processing, warehousing, and export marketing of grain crops to help ensure regional food security.

Pakistan has over 20% of its GDP linked with agriculture and about 64% of the human resource associated with it. This collaboration will potentially unlock a tremendous amount of untapped land resources of Pakistan by bringing fallow lands under cultivation for sustainable production of crops like rice, barley, oats, silage bales for livestock, and dairy industry under the Corporate Agriculture Farming initiative. Fatima Group, along with the Trade Development Authority of Pakistan, is at the Pakistan Pavilion in Expo 2020 Dubai over the next four days, holding a range of events showcasing its commitment to help ensure regional food security, agricultural innovation, and women empowerment in the agriculture sector of Pakistan.

Fatima Group contributes significantly to the economic development of Pakistan. It was established in 1936 to ensure the trading of commodities and which gradually entered into the manufacturing of various products. The Group has ensured a success story that has spread over seven decades, expanding its horizon from trading to manufacturing. As of now, the Group is engaged in trading of commodities, manufacturing of fertilizers, textiles, sugar, mining and energy.

Riaz Haq said...

Muneeb Sikander
1/2 Pak Flood hit rural economy

Work produces things of value and transforms physical world in ways to make life better and survival possible.

But without organised and purposeful productive action, i.e., work, not possible for most people asis at the base of economic order


2/2 Flood hit rural areas

Agrarian to agriculture/livestock based or limited workshop industry. Limited Agri TFP + 15.4 million at poverty risk

1. Need for agri TFP improvement
2., Need to diversify economic base by Proto-industrialization,

Riaz Haq said...

How to Jump-Start Industrialization in Sub-Saharan Africa
May 27, 2021
By Yi Wen , Iris Arbogast

Most sub-Saharan nations have such low per capita incomes that it would take decades of double-digit growth to attain U.S. living standards.
Nations that industrialize successfully often begin with small-scale efforts and progress to mass-producing heavy industrial goods.
African countries could follow this development pattern with government-provided infrastructure and other support.

When considering income disparities across nations, the differences often can be striking, particularly for nations in the sub-Saharan region of Africa. Per capita income in many poor countries like these is 30 to 50 times smaller than in the U.S. In sub-Saharan Africa, 38 of 48 countries had gross national income (GNI) per capita levels below $2,300 in 2019, while GNI per capita was $65,850 in the U.S., according to data from the World Bank’s World Development Indicators database.

Generations of economists have studied economic development and given policy suggestions to officials in poor countries in Africa and elsewhere, but the disparities remain. To catch up to U.S. living standards, they would need to grow at about 11% per year for 40 to 50 years—an almost impossible standard that only China has come close to achieving in recent history.

The New Stage Theory of Development
The commonality between successful Asian countries’ industrialization (such as China’s rapid rise in the past 40 years) and successful European nations’ industrialization (such as the British Industrial Revolution in the 18th* and 19th centuries) is that these economies all went through three key stages during their industrialization, according to the New Stage Theory of Development (NST):1

Proto-industrialization, which features massive numbers of workshops in rural areas with small-scale production of basic consumer goods for long-distance trade
A first industrial revolution, which features mass production of labor-intensive, light consumer goods for domestic and international markets
A second industrial revolution, which features mass production of capital-intensive, heavy industrial goods
The first stage is very important but has been largely ignored by development economists. During this initial stage, rural farmers or poor households in urban areas use their free time to manufacture simple products and engage in long-distance trade. This raises their income and nurtures the formation of an increasingly unified market and primitive production networks, while developing entrepreneurship and labor skills. 2

During the second stage, large-scale factory systems become prevalent for light industries such as textiles, processed food, toys and furniture. This mass-production stage is labor-intensive, export oriented and benefits from poor countries’ comparative advantage in cheap labor. Mass production in the second stage is profitable only because proto-industrialization has created a large enough market and distribution networks for consumer goods.

Finally, the expansion of light industry in the second stage facilitates the formation of a large enough market for heavy industrial goods—such as means of transportation, energy, steel and heavy equipment. This is not only because the income of workers needs to be high enough to purchase big-ticket items such as automobiles, but because mass production of heavy industrial goods is profitable only after the second stage creates a mass-production chain to support their demand. 3

Riaz Haq said...

Cotton From Prehistoric Pakistan Found in 7,200-year-old Village in Israel

The cotton found in Neolithic Israel, dyed in blue and other colors, couldn’t have been local because it isn’t indigenous – but it was in the Indus Valley, archaeologists say

Around 7,000 years ago, somebody arrived in a prehistoric village in today’s northern Israel with a luxurious novelty: cotton.

Cotton was not known to the earliest civilizations rising in the Near East because it isn’t indigenous to the region, and where and when it was first domesticated remains a mystery. But now traces of this alien plant with its exquisitely soft bolls have been detected in Tel Tsaf.

This is the earliest trace of cotton found in the Near East to date by centuries, the researchers say. They believe it originated in the Indus Valley, though do not rule out an African origin.

How did cotton get to Tel Tsaf 7,000 years ago from the Indus Valley (or North Africa)? By trading, suggest Li Liu of Stanford University, Maureece Levin of the University of Arkansas at Little Rock, Florian Klimscha of the Lower Saxony State Museum (Hannover, Germany) and Danny Rosenberg of the University of Haifa, writing in Frontiers in Plant Science.

Tel Tsaf contains the ruins of a village that arose about 7,300 to 7,200 years ago and would thrive for about 500 years, after which it was deserted for reasons that remain unknown. That in itself is quite the mystery given the abundance of its environs in the central Jordan Valley, south of the Sea of Galilee, Rosenberg notes. But for its time, this had been some settlement.

The wonders found during half a century of excavation there include the most ancient copper object in this part of the Middle East (there’s somewhat older in Iraq), a clay model of a grain silo – possibly indicating ritual involving food cultivation and storage – and a stamped sealing from around 7,000 years ago. This all suggests, the archaeologists surmise, that Tel Tsaf was an extraordinarily wealthy place as Late Neolithic settlements went.

Now Liu, Rosenberg and colleagues have detected cotton microfibers, at least some of which were dyed, from 7,000 years ago. This may provide further indication of trading relationships at the cusp of the transition from the Late Neolithic to the Early Chalcolithic in the valley.

It bears adding that the earliest cotton reported previously was in Dhuweila, eastern Jordan, and dates to centuries later – some time between 6,450 years ago to around 5,000 years ago.

To be clear, it isn’t that humans strolled around in the altogether with their bits flapping in the breeze until discovering the delights of cotton. The thinking, says Rosenberg, is that the earliest garb was animal skins, whether worn to preserve modesty, for reasons of status, for warmth or for some other reason.

Riaz Haq said...

Cotton From Prehistoric Pakistan Found in 7,200-year-old Village in Israel

But hmo-kind discovered plant fibers at least tens of thousands of years ago. In 2020, archaeologists found no less than three-ply cord in a Neanderthal context in France, taking the crown from 23,000-year-old string found in Ohalo, Israel. What the Neanderthals or humans from Ohalo were doing with string, we do not know. However, the archaeologists note that the ability to create cord is the prerequisite for a host of potential developments, including textile weaving.

Textiles do not preserve well in the archaeological record, to put it mildly. Yet moving on from the Ohalo cord, evidence of early weaving pops up here and there – including an extremely complex woven basket found in a cave in the Judean Desert from 10,500 years ago. Material made of oak bast (the innards of bark), meanwhile, was found in Çatalhöyük, Turkey, from 8,500 years ago.

In short, before cotton, people in the region were using bast and flax fibers. And now Liu, Rosenberg and the team report on cotton in Tel Tsaf – definitely from afar, and seemingly before the plant had even been domesticated. And it was dyed, to boot.

What colors were the fibers tinted, and can they speak to Neolithic tastes? They cannot. Rosenberg stresses that the sample of fibers from Tel Tsaf is small (123 microfibers in total), and 16 being observed to be cotton in shades of blue, three pink, one purple, one green and three brown/black means precisely nothing about their preferences. What it does mean, the professor qualifies, is that these late prehistoric peoples were not just making textiles and fibers – they were doing further manipulation and coloring their cloths.

By the way, the most frequently used fiber in ancient Tel Tsaf was bast, and they also used flax and jute, the archaeologists report.

A story from Pakistan

Let us move onto the cotton's origin. Why couldn’t the cotton fibers of Tel Tsaf be local? And why do they think it’s Pakistan, not North Africa?

It isn’t likely to have been grown locally because cotton is happiest in tropical and subtropical regions with ample water. It apparently didn’t grow in prehistoric Israel, and the thinking is that like the “invention” of agriculture itself – the cultivation of cotton arose independently around the world, including in the Indus Valley and North Africa. “But cultivation in North Africa was later,” Rosenberg explains.

The earliest archaeological evidence of cotton’s use is in the Pre-Pottery Neolithic period at the Mehrgarh burial site in central Balochistan, Pakistan. Cotton threads were used to string copper beads about 8,500 to 7,500 years ago.

It bears clarifying that the earliest known cotton fabric is a tiny fragment of actual cloth (albeit stuck to the lid of a silver vase), which was discovered at Mohenjo-daro, also Pakistan, from 5,000 to 4,750 years ago.

So, cotton was known in some context in prehistoric Pakistan at the time of its appearance in Tel Tsaf, Rosenberg says.

What cotton? Wild cotton. The plant apparently wouldn’t be domesticated for at least 2,000 years more, he explains. “Based primarily on evidence from seeds, domestication is thought to have occurred during the time of the Harappan civilization (2600-1900 B.C.E.),” the authors write.

And how might the wild cotton have been used, aside from making threads to string crude copper beads? Weaving textiles is a reasonable assumption, because cotton isn’t the stuff for baskets.