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Fan industry be given incentives to boost exports

SAEED AKHTAR BALOCH

LAHORE: Fan industry has been contributing substantially to the national exchequer in terms of direct and indirect taxes, but unfortunately, this is one of those sectors which have been badly ignored by the successive governments.

"Pakistan's fan export revenue could cross $ 15 million per annum during the next 3-4 years, provided the government gives due attention towards this vital industry and extends incentives to the manufacturers," Mohammad Ilyas, Chairman, Pakistan Electrical Fan Manufacturers Association (PEFMA) said in an interview with Business Recorder.

He said that fan industry was a potential sector and the government could increase its revenue in terms of foreign exchange by promoting and supporting it.

Mohammad Ilyas, who is also Chief Executive of General Fan Company (GFC), said that fan industry had a lot of potential for exports, but it had not been tapped properly.

He stressed the need for exploring more markets for increasing export of fans.

He said currently his company was exporting its products to Bangladesh, Yeman, Saudi Arabia, Dubai, Qatar and West Indies and it should be a matter of pride for the country that in these countries Pakistan-made fans were being appreciated and even preferred over Indian and Taiwanese products. In Yeman, GFC fans had beat the Indian 'Oosha fan' because of its competitive price and better quality, he added. Currently, GFC was exporting 20,000 fans annualy only to Yeman.

Mohammad Ilyas said that GFC started exporting fans in 1996 and its export revenue which was only Rs 4.5 million in 1996-97 reached Rs. 10.5 million in 1997-98, while the figure touched Rs. 30 million mark in 1998-99. This year his company had exported over 30,000 fans during the first nine months of the current fiscal "and hopefully it will exceed in earning a foreign exchange to the tune of Rs. 50 million." GFC has pioneered export of Pakistani fans, and it was a healthy sign that now other manufacturers were following it.

"Let me make it clear that we have achieved this hall mark on self-help basis and the government has not supported us in this regard."

He said that Bangladesh, Qatar, Dubai, and Saudi Arabia were major importer, of Pakistani fans, but there was an urgent need to explore more international markets.

The PEFMA chairman demanded of the government to increase the current rebate ratio on fan exports from 7.1 percent to 11.5 percent in order to encourage the industry, besides giving his Association representation in Pakistan trade delegations sent abroad. This step would encourage fan manufacturers and ultimately result in increase in exports of the country. He also urged the government to meet the long-standing demand of PEFMA regarding setting up a "fan development institute" in the country.

He said that five years back Export Promotion Bureau (EPB) had extended a financial assistance of Rs. 9 million to PEFMA for this purpose. This amount was utilised for purchasing a piece of land and constructing a building for the institute. But unfortunately, the classes could not be commenced because the government refused to provide funds for purchase of equipment.

He said that some time back the Association had prepared a feasibility with the help of World Bank and Lahore University of Management Sciences (LUMS) for setting up an "export development fund (EDF)" for testing of raw material to improve the quality of fans. The previous government in the last budget had also approved a grant of Rs. 30 million for this purpose, but the present regime has shelved the project, he stated.

"I on behalf of my Association appeal to the Finance Minister to give a serious thought to their demands and provide the approved funds for setting up the proposed fund and purchase of equipment for the Fan Development Institute.

He also demanded of the government to abolish 5% excise duty on winding raw material used in fans in better interest of the fan manufactures.