Sunday, September 20, 2009
Some of the major and predominant economic powerhouses of the world have demonstrated that the Manufacturing has and will become the catalyst for economical and social growth. China and Germany have both ensured that their maximum influx of goods is created within the realm of their country especially the most important raw material for larger manufacturing plants. The true success of any nation is to imbed and construe the unique manufacturing units that harbinger other industries. An example of this is plastic, steel, iron and coal mine industries. All of these specific niche markets further grow other economies of scale and thus overall contribution to the GDP and the overall economical condition to the masses.
A similar trend is associated in the telecom market. All organizations and countries require telecom infrastructure to boost communication and speed of delivery of information from the world. Robust and reliable infrastructure ensures that countries are not only geared to connecting to the world but are also ready to produce new avenues of e-service and e-commerce.
Telecom infrastructure primarily is built off of fiber networks and sophisticated network elements. There exists only a random number of equipment vendors that can truly Foster and implement gigantic networks. Cisco, Nortel, Siemens and Motorola are the key ingredients to the success of any infrastructure network. The solution providers are able to provide the network components, integrated technologies and a complete turnkey solution for fiber networks that spans nations and further align with international bandwidth providers.
The cost for building of infrastructure is exponentially high and it is in the best interest of the nation to ensure that the maximum number of components that would be used will be manufacture in-house. Without this plan in place, millions of dollars can be lost and revenue losses can reach new heights.
Pakistan has been extremely unfortunate in terms of building infrastructure off of this plan A strategy. The government of Pakistan over the last decade has placed a huge amount of money in the overall investment, development and expansion of a nationwide network. Major cities are now connected through continuous fiber that is not only redundant but extremely robust in terms of speed and reliability.
The question is how much of that equipment was actually imported and how many of the network components manufactured within the territories of Pakistan? A similar example can take place regarding the cell phone industry. There are several cell phone providers that play a pivotal part in the cell phone arena in Pakistan. Nokia, LG and Sony Ericson are the key players.
With such a devastating market of people and opportunity, one would think that the government would rationalize and ensure that all of the cell phones that are distributed will be built, manufactured and circulated within Pakistan. There will be zero amount of import of cell phones. New make and models will be made within Pakistan and the servicing of older models will also be catered by the ongoing growth of service centers. Imagine a world where factories and manufacturing plants were constructed anywhere in Pakistan.
Just comparing the number of cell phone users and the circulation of purchase associated of new phones, hundreds of people will be employed in the assembly plants and hundreds of people will be enjoying servicing the markets through development of service centers.
A simple decision of ensuring manufacturing of cell phones would have kick started the economy and given at least a million people jobs for the long run. The one million number is based upon calculating the average time and work hours required to produce a cell phone. Benchmarking the best industry standards. This could have played a pivotal part in the overall success and stability of the country. Just imagine one million people who are currently jobless had the opportunity of developing their careers and legally adding to their family growth!
There are certain pros and cones associated with development and manufacturing of cell phone industries. Major disadvantage is the quality of equipment that is being manufactured. Poor cell phone quality would lead to dissatisfaction of service offerings. That is where the government has to ensure the proper check and balances associated with developing products that are quality driven. Proper organizations have to establish and the manufacturing plants have to be ISO certified to further obtain tax benefits.
Job availability to 1.2 million people
Reduction of import
Degradation of poor output if no proper check and balance in place
Dissatisfaction if no proper check and balance in place
It is extremely critical that the Ministry of IT takes heed of the benefits associated with this strategy and build its cell phone industry from a broad spectrum of in-house manufacturing units. The benefits will certainly out way the disadvantages.