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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.
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Pakistan Growth By Decades. Source: National Trade and Transport Fa... |
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.
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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.
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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.
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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.
Summary:
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:
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
Views: 686
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Comment by Riaz Haq on March 5, 2023 at 8:32am
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Hanging out with Pakistan’s 1%
https://tribune.com.pk/story/2404547/hanging-out-with-pakistans-1
“Interestingly, military officers prefer industrialist girls or even the daughters of bureaucrats with good standing and they seem to shy away from politicians,” she says. “Marital strategies continue to be one of the most powerful mechanisms employed by the Pakistani elite to protect their economic assets and their social status, to foster inter-elite networks and to gather information on other elite families.”
Many of the established elite families that Armytage spoke to view themselves as having really high culture and elite dispositions. “Often they have actually lost a lot of wealth that they originally had, but they continue to own property and have high status, even though they’re no longer the most-wealthy people in Pakistan. Many wealth holders are the nouveau riche families but they don’t have old-money prestige and hence feel stigmatised. Often the established elite as gatekeepers, keep out the nouveau riche from institutions such as the elite social clubs of Lahore and Karachi and established elite schools that they want to be part of and where business and marriage decisions are made. They try to keep them out because these families are losing income comparative to the nouveau riche families. Marriages blend the wealth of one family with the status of another, provide an overall security and stability, and protect these families from political volatility. Some influential families have connections to the princely states in India so it’s all about propelling upward mobility.”
Armytage explains why, for instance, people from solid middle-class backgrounds who were in the military weren’t able to break into the social forums of the established elite and weren’t even able to do business with a certain group of people. “It is because they were never invited to the right parties,” she says. “But when they go about setting up marriages with the daughters or sons of some of those most established elite families, it brings a huge influx of capital to families who are running on fumes despite huge properties.”
Another interesting deduction Armytage makes is that Pakistani elites don’t like to dominate and be competitive in the world because they enjoy being big fish in a little pond. “A number of elites in other parts of the world also find that when they leave their country, they lose their status and access that they had before,” she points out. “When the Russian elites came to London, they brought in enormous wealth, much more than the Londoners they were spending time with. Yet they couldn’t break into these elite circles because they were viewed as too ostentatious and crass.”
Since most of her research done in 2014 was a turbulent time for Pakistan, many people told Armytage they couldn’t possibly move overseas permanently, because it would be dull without the excitement of Pakistani politics and being in the centre of the constant drama.
Towards the end of the book she discusses that the contemporary Pakistani elite are closer to their colonial predecessors in their abuse of power and moral grounds than they would like to acknowledge.
Armytage sees food insecurity, climate change, and uneducated youth population as serious challenges for Pakistan and she hopes that the country would increase its wealth base and that as a result of moving into middle-income status, there could be more wealth available and less people living in poverty. She believes that good policy making can transform people’s access to resources, their ability to grow their own income and to improve the lives of a larger number of people, which has happened to some degree in each of the decades post-partition.
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To determine the top 15 Pakistani public companies, we utilized their market capitalization as our primary metric. Our data was obtained from Standard Capital Securities (SCS). Furthermore, we gathered information about Pakistan's leading companies from different sources, such as ADO, the World Bank, Pakistan Stock Exchange Limited and SECP.
https://finance.yahoo.com/news/15-biggest-companies-pakistan-market...
8. United Bank Limited
Current Market Cap: USD 550 million
UBL is a subsidiary of Bestway Group, a British company. It is headquartered in Karachi and considered one of the biggest private banks in Pakistan, boasting more than 1,390 branches in the country and having 18 branches abroad. It serves over 4 million customers. The company's market capitalization was $550 million as of 2023.
7. Colgate-Palmolive Company
Current Market Cap: $590 million
Colgate-Palmolive Pakistan Limited has a market cap of $590 million as of 2023. It is a subsidiary of Colgate-Palmolive Company, a global consumer goods company. It maintains a prominent position in Pakistan with a broad distribution structure that caters to the rural and urban regions. The company generates substantial income through taxes and duties for the Pakistani government.
6. Meezan Bank
Current Market Cap: $620 million
Meezan's main office is located at Meezan House in Karachi, and it has a vast network of more than 900 branches in over 250 cities. The bank obtained the Pakistan operations of Société Générale. Meezan's market capitalization was $620 million as of 2023.
5. Pakistan Petroleum Limited
Current Market Cap: $630 million
Pakistan Petroleum Limited (PPL) has played a key role in the energy sector of the country since the 1950s and is credited with spearheading the natural gas industry. PPL remains a significant supplier of natural gas, accounting for about 20% of the nation’s total supply. The company also produces crude oil, natural gas liquid, and liquefied petroleum gas. The company’s market cap is $630 million as of 2023.
4. Pakistan Tobacco Company Limited
Current Market Cap: $650 million
Pakistan Tobacco Company Limited was established in 1947. The company acquired the operations of the Imperial Tobacco Company in India that had been running in the subcontinent since 1905.
3. Mari Petroleum Company Limited
Current Market Cap: $750 million
Pakistan relies heavily on oil and gas imports to fulfill its energy requirements. The advancement of domestic oil and gas resources is crucial for the economic development of the country. MPCL has played an essential role in exploring and producing oil and gas, which has reduced the country’s dependence on foreign energy sources.
2. Nestlé Pakistan Limited
Current Market Cap: $840 million
Nestlé Pakistan Limited was established in Pakistan in 1988 and is headquartered in Lahore, Pakistan. The company is primarily focused on the manufacture and sale of food and beverage products, including milk, tea, coffee, confectionery, and culinary products. The company’s market capitalization is $840 million as of 2023.
1. Oil and Gas Development Company Limited (OGDCL)
Current Market Cap: $1.3 billion
The Oil and Gas Development Company Limited (OGDCL) is an oil and gas exploration and production company in Pakistan. OGDCL has played a pivotal role in the development of the country’s energy sector and is the largest producer of oil and gas in Pakistan. It has its headquarters in Islamabad, and the government owns the majority stake of 74%, while the remaining portion is held by private investors. The company’s market capitalization is $1.3 billion as of 2023.
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To determine the top 15 Pakistani public companies, we utilized their market capitalization as our primary metric. Our data was obtained from Standard Capital Securities (SCS). Furthermore, we gathered information about Pakistan's leading companies from different sources, such as ADO, the World Bank, Pakistan Stock Exchange Limited and SECP.
https://finance.yahoo.com/news/15-biggest-companies-pakistan-market...
Here are the 15 biggest public companies in Pakistan:
15. Pakistan Oilfields Limited
Current Market Cap: $418.2 million
Pakistan Oilfields Limited is among the largest companies engaged in the exploration and production of crude oil and gas in the country. Its activities encompass drilling, exploration, and production, resulting in the production of crude oil, natural gas, and LPG that are marketed under POLGAS and its subsidiary, CAPGAS Private Limited. The company's market capitalization was $418.2 million as of 2023.
14. Systems Limited
Current Market Cap: $460 million
Systems Limited, a prominent technology consultancy and software development firm based in Pakistan, provides a diverse array of software services and solutions, such as customer relationship management, business intelligence, and digital transformation. Its customer base lies across multiple sectors including finance, manufacturing, education, and healthcare. The company's market capitalization is $460 million as of 2023.
13. Unilever Pakistan Foods Limited
Current Market Cap: $460 million
Unilever Pakistan Foods Ltd. is a company that produces and sells food products for both consumers and businesses. They sell their products under several brand names, including Rafhan, Knorr, Energile, Glaxose-D, and Food Solutions. In addition to food, they also offer personal care and home care products. The company was established in 1946 and is based in Karachi, Pakistan. Its market cap, as of 2023, is $460 million.
12. Fauji Fertilizer Company Limited
Current Market Cap: $460 million
Fauji Fertilizer Co Ltd is primarily engaged in the production of fertilizer. The company's market capitalization is $460 million as of 2023 and has a P/E ratio of 3.68.
11. Lucky Cement Limited
Current Market Cap: $490 million
Lucky Cement's contribution to the construction industry and the national economy has been significant, and it continues to play a key role in the development of infrastructure in Pakistan and abroad. The company's market cap is $490 million as of 2023.
10. MCB Bank Limited
Current Market Cap: $500 million
MCB Bank is listed on the Pakistan Stock Exchange and has a strong financial performance, reflecting its sound business strategy and operational excellence. The bank's contribution to the national economy has been significant, and it continues to play a key role in the development of the financial sector in Pakistan. The company's market capitalization is $0.5 billion as of 2023.
9. Engro Corporation Limited
Current Market Cap: $550 million
Engro Corp. Ltd. is involved in various industries such as fertilizers, PVC resin production and marketing, food, energy, and chemical terminal and storage. The company was founded in 1965 and is headquartered in Karachi, Pakistan. It has a market cap of $550 million as of 2023.
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Two Titan submersible passengers were prominent science philanthropists in Pakistan
https://www.nature.com/articles/d41586-023-02100-y
Two of the passengers who died when the Titansubmersible imploded on its way to explore the wreckage of the Titanic in the North Atlantic belonged to a family that are prominent philanthropic funders of science in Pakistan.
Shahzada Dawood, and his son, Suleman Dawood, were part of the Dawood Foundation, which set up a university, girls’ school and museum, all with major focuses on science.
“The tragic loss of father and son is, first and foremost, a human tragedy and a tragedy for the family,” says environmental scientist Adil Najam, who also studies philanthropic giving in Pakistan. “We have also lost someone with a real, personal and abiding interest in science. It is a tremendous loss of a champion for science.”
“This is a huge tragedy for Pakistan,” adds Atta-ur-Rahman, a chemist at the University of Karachi and a former minister for science. “The [Dawood] family has made enormous contributions to education and science during the last five or six decades.”
The Dawood family’s foundation established the Dawood University of Engineering and Technology in Karachi; the Karachi School of Business and Leadership; the MagnifiScience Centre, Pakistan's first contemporary science museum also in Karachi. Dawood public school provides high quality science education for girls, Najam says.
Members of the Dawood family posted a statement to the foundation website about the deaths of Shahzada and Suleman. “We are truly grateful to all those involved in the rescue operations. The immense love and support we receive continues to help us endure this unimagineable loss.” The statement also said: “At this time, we are unable to receive calls and request that support, condolences and prayers be messaged instead.”
Both Rahman and physicist Pervez Hoodbhoy of the Black Hole Institute, a science and cultural centre in Islamabad, say that the Dawood Foundation is a rare example of much-needed science-philanthropy. Many young people are trying to leave Pakistan because of an economic crisis and a lack of opportunities. Around 800,000 people left in 2022 to seek work abroad. Between 400 and 750 people from Pakistan, as well as Egypt and Syria died last week when a boat capsized off the Mediterranean Sea on its way from Libya to Europe, according to media reports.
The Dawood family foundation has tried to address these problems by creating opportunities for science education. Rahman adds that there is much more that needs to be done. “We need to rethink our national policies, so that we can use this huge pool of talent for our own socio-economic development,” he says.
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Family of Pakistani father and son who died in Titan submersible shares memories and gratitude
https://apnews.com/article/titanic-submersible-implosion-pakistan-d...
ISLAMABAD (AP) — The family of two Pakistani men who died in the implosion of a submersible as it descended to the wreckage of the Titanic held a virtual memorial service Tuesday and thanked everyone who tried to rescue the father and son or sent condolences from around the world.
The prayer service was arranged by the family of Shahzada Dawood and his 19-year-old son, Suleman, days after authorities confirmed that everyone on the Titan died. The submersible carrying five people imploded near the site of the shipwrecked Titanic and killed everyone on board.
Shahzada Dawood’s widow, Christina Dawood, was in tears as she shared memories of her husband and son. She was on board a support vessel on June 18 when she got word that communications with the Titan submersible had been lost during its voyage to the ocean floor.
In her remarks, she thanked those who had helped the family in its time of grief. The service was broadcast on YouTube through the family’s charity, the Dawood Foundation.
Shahzada and Suleman Dawood were members of one of Pakistan’s most prominent families. The elder man’s father, Hussain Dawood, said during Tuesday’s service that his son and grandson were gifts of God that had been taken back by God.
He also described the two as martyrs and said “martyrs go straight to paradise.”
“What does the father say” when he faces such a tragedy, he asked.
Hussain Dawood, said Suleman and Shahzada were very excited about going to see the Titanic and before leaving for their voyage convinced him that“we should go to Antarctica, too” next winter.
“I’m actually convinced they have enriched our lives beyond measure,” Dawood said, vowing, “We will take forward their legacy.”
Christina Dawood shared memories of when she first met her husband and their wedding in Pakistan’s eastern city of Lahore.
When Suleman was born, her husband was happy like other fathers but “when he held his son for the first time, I just knew these two belong together,” the wife and mother said. She sensed then that he had “found a long-lost companion for his adventures to come.”
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