Fear is what India, Pakistan need to defeat: Mian Muhammad Mansha - Broadsword by Ajai Shukla - Strategy. Economics. Defence.

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Tuesday 2 October 2012

Fear is what India, Pakistan need to defeat: Mian Muhammad Mansha



Interviewing Mian Mansha, Pakistan's richest man, at his office in Lahore

by Ajai Shukla
Business Standard, 3rd Oct 12

Mian Muhammad Mansha, Pakistan’s only dollar billionaire, heads the Nishat Group. He owns MCB, Pakistan’s most profitable bank, and has major interests in cement, textiles, power and insurance. Mansha’s three sons work with him; his wife, Naz, runs Nishat Linens, a key revenue earner for the group. Talking to Ajai Shukla in Lahore, Mansha argued for closer commercial ties with India.

BS.            The arguments for India-Pakistan trade that you often highlight --- geographical proximity, language, culture, etc --- are undeniable, but political antagonism comes in the way. Is that changing?

Mansha.            I see a major change here. Pakistan’s media has created a new awareness, changing thinking amongst our people, the foreign office, the security establishment and the political parties. No political party in Pakistan opposes trade with India. In India it is different; there is still opposition there. Also, opinion is more regionalized in India; a person in Madras or Bengal does not yet understand that the fruits of trade will go there also.

(India must think about) what will happen if Pakistan turns out to be like Afghanistan. What if there is turmoil in Pakistan? If there are huge problems here they will spill over into India too.

BS.            Who are the spoilers that oppose closer economic ties?

Mansha.            People who don’t want to change and who fear that their industries will be affected by opening to India. They use arguments like, “look what happened at partition.” There is a false perception that Indian companies will swamp us. Instead, I think they would complement us. Look at Standard Chartered Bank: it has 89 branches in India and makes $1.2 billion in profit, but in Pakistan they can’t compete with us. In the banking sector, we cleaned up our banks 10-15 years ago. I would love to have my branches in India.

BS.            What immediate steps could boost bilateral trade?

Mansha.            We need more border points (like the integrated check post, or ICP, at Wagah). We need them to become more efficient by fostering competition between them. Currently, it costs Rs 750/- to transport one tonne of cement from Lahore to Amritsar, the same as it costs to transport it to South Africa.

Cement is a price sensitive export. If I have to pay Rs 80/- to transport a Rs 300/- bag of cement across Wagah, then how can I compete in India? We need to reduce the cost of doing business. And we can only do that by opening more border points, forcing them to compete for business.

BS.            India and Pakistan signed three new commercial agreements last week to increase trade? Which industries would benefit?

Mansha.            We have important complementarities in cotton. Pakistan’s cotton harvest starts from June-July, and India’s from November. Why should Indian mills store cotton for a full year when they can buy four months’ stock from Pakistan and we can buy for the next few months from India. The cost of inventory will come down in both countries.

Monsanto has a plant in (Indian) Punjab that develops BT cotton seeds. They can also access the Pakistani market. India’s cotton-growing practices are excellent. In textiles, we are very strong in certain segments. Pakistan has good high street fashion at affordable prices, which India could buy. Pakistan’s textiles exhibition was sold out in three days in Delhi (in April). My wife is in the textile business and runs a chain of shops. We want to open some of our stores in Ludhiana, Amritsar, Delhi and Mumbai. On the other hand, Indian polyester plants are much more competitive.

We should be able to buy power equipment from India. If we need PETCO, which is petroleum coal, not natural coal, we should be able to get it from Gujarat. So far we have been getting it from Houston.

Pakistan’s cement factories are efficient because we have plenty of limestone and gypsum. We should be able to buy Indian petroleum products from the Bhatinda refinery. I believe the Indian pipeline is just 100 km from Lahore. Your ports should compete with Karachi port.

BS.            And you believe Pakistan is ready for all these openings?

Initially, our industry will resist. Change is always difficult. Maybe we need three years to adjust. Then nature will take its course. Fear is what we need to defeat. France and Germany had this problem after World War II, but (President) De Gaulle and (Chancellor) Adenauer resolved it together. We both need far-sighted leadership.

BS.            The new liberalized visa regime would ease business travel on both sides…?

Mansha.            It’s a good beginning, but we need to be bolder and take practical steps to ease business travel. Take my own case: I have a one-year Indian visa, but I can’t visit Amritsar because the visa is only for Delhi and Mumbai. These are bureaucratic hassles. Surely there are some businessmen on both sides who both governments think are clean! India and Pakistan should draw up a list of these people; we should have a white list for visas instead of a black list.

BS.            Could we see India and Pakistani entrepreneurs joining forces in the international market?

Mansha.            We should tie up with India’s entrepreneurs, who have demonstrated in several overseas markets that they can run businesses better than domestic companies. Indian and Pakistani entrepreneurs can have joint ventures in third countries. I have discussed with some Indian groups and we are looking at working together in Africa. Many African countries are getting their political act together; there are opportunities in countries where governance is good and corruption low.
           
BS.            Do you have any plans to invest in Afghanistan?

Mansha.            The Nishat Group is trying to set up a bank in Afghanistan. Chinese and western companies are taking all the big contracts there, but Indian and Pakistani companies could work together profitably. However, there is resistance in Pakistan to India doing business in Afghanistan --- some people opposed it firmly, while others support it. Certain sectors feel threatened. Years of misconception have to be dealt with, so we need to work on the public image.

22 comments:

  1. Superb. Both countries have lots to gsin as the downside is minimal. Vested interests that have lived of this hostility will surely attempt to scuttle it.

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  2. @Ajai sir

    a few things

    while Pakistani businessmen say a lot about normalizing relations through, dont you think the first thing to do is to cut down the level of mistrust between the 2 countries, and root out the cause of mistrust.

    Just 2 things most Indian films are banned, 2 wheeler and 4 wheeler made in India are not sold in Pakistan.

    By the Way just read news report that India - China border dispute is in last leg of finalization.

    It may have may huge impact on India's relation with Pakistan (god forbid if India gives up Aksai Chin).

    PS. lately you are reporting on many polito-defense issues, and only giving news reports on various defense matters. why?

    thanks

    Joydeep Ghosh

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  3. "Borders frequented by trade seldom need soldiers."

    A statement made by our president at Thunderbird school of global management. It holds so true in this case.

    ReplyDelete
  4. "Borders frequented by trade seldom need soldiers."

    A statement made by our 2nd president of Thunderbird School of Global Management, my Alma mater. Hopefully, it can hold true in this case

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  5. wet dreams of a businessman who wants another expansion...

    i know... i know... people will benefit, both ends, pak more than India, and that means enemy gets more... thanks but no thanks,

    if someone wages war on you so many times and you still open your gates, you are no saint, you are a FOOL

    we dont want pakistani crap here... even if we benefit more... thanks but no thanks,... culture cricket and shit... all comes later

    first, that nation needs to come off the enemy list... and it will take ages.. till then show honesty and restraint! build some genuine trust

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  6. Did he spoke against... or for... dawood ibrahim kaskar... of kasai clan... now he knows how... terrified life... kaskar is living... seems this paki wants to... bail him out of his... miserable existance... don't worry raw will do it... for him... are you doing the same??? ...

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  7. two words- FUCK THIS.. I say bilateral and military trade with Japan should be fostered.. Why you ask? Their economy is slowed, they are militarily strong with common enemies and technologically leveled as the west. Japan needs natural resources like coal, gas which India has plenty.. In return you should for direct investment that should improve infrastructure, microprocessing tech and other height tech development projects and these project will help India technologically and structurally and Japan economically

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  8. @"CEO,Monster Inc"
    "Borders frequented by trade seldom need soldiers."
    this is just an assessment,not the truth.it is general case,if you look at US and china,china's entire economy is dependent on US,but all there nuclear weapons are directed towards cities of US,same goes for China and Japan.the same applies for India- Pakistan,we have territorial disputes,Pakistan sees India's control of Kashmir as a Hindu rule over Muslims,they are blinded by their religion and they will never compromise on Kashmir.
    i agree with most part of article,but i very much doubt when the person of interest claims that India and Pakistan can complement each other,if the borders are opened,then trade deficit will widen and will hugely be in favor of India,this is a damn good thing,we can then arm twist Pakistanis on our will,when they will have to pay us in billions,we can start controlling most of their economy at our will.

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  9. Ups & downs remain in relations but trade must go on between the 2 countries as this has nothing to do with politics. Atleast the products which r uncommon must be pushed in trade. An example can be taken, after partition jute producing region went to bangladesh & jute industries to west bengal. now almost most of the jute industries in bengal has come to close & farmers in bangladesh not getting price for the jute crops. Net result, the common people r the sufferers on both sides.

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  10. Yes fear is to be defeated. But only after:

    1. The ISI's mendacious agenda.
    2. The Pakistani Army's development of India as a bogey.
    3. The dishonest Pakistani education system that inculcates terminal hatred for india from an early age.
    4. And oh yes, Islamic Extremism.

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  11. And - All the countries that became friends through trade, France and Germany, US and Japan, they only did so after the primary aggressor admitted it was wrong, i.e after Germany and Japan admitted defeat and adopted pacifist ways.

    So Mian saheb, please change your country first. We are open to the rest of the world, you'll be no exception if we dont feel the need to build defences against your thugs, uniformed and non-uniformed, guided and misguided.

    ReplyDelete
  12. "...France and Germany had this problem after World War II, but (President) De Gaulle and (Chancellor) Adenauer resolved it together."
    That is correct. It is also correct that Germany did not send Jehadis to blow up the Eiffel Tower and bomb the Senate and the National Assembly. I respect France for having the courage to enact laws which has a higher precedence than any relegious laws.
    NRP

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  13. @ Anonymous 4 October 2012 10:24

    on your wrong attitude and statement "They will never compromise on Kashmir". Its not them who have to compromise, Its us who will be compromising If we give it away. Tommorow they will start thinking India's occupation of Hyderabad infact whole India is wrong, and it should be rules by Muslims, then? You need to correct your attitude first, you life becomes what your attitude it. Its our attitude that we have made that pony country looks like a huge mountain of problems.

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  14. It takes just "ONE" David Coleman Headley from Pakistan for India to deny 100 Mansha's entry into India.

    The "risk" involved in doing business with Pakistan is FAR FAR greater than any other country due to security component involved. Should anything untoward happen, like another Mumbai etc, the government will have no option but to shut down this "co-operation".

    The difference between France and Germany after WW2 and India and Pakistan is that neither France nor Germany were training terrorists to kill each other. They fought on the battlefield and decided their grievances with the honor of the battlefield. This is not the case in India and Pakistan.

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  15. MCB bank maybe Pakistan's "biggest" bank but in India it is not even comparable to small banks like Yes Bank etc. Indian banks are cut throat and if MCB thinks it can compete against the likes of ICICI, SBI, HDFC, it is clearly overestimating its competence.

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  16. @Int64 4 October 2012 10:24
    go through the comment carefully pal.
    my sentence is damn clear,no matter how much we open our borders to them,they will never give up their claim on Kashmir.Now the ground realities have changed,even India cannot get back Pakistan occupied Kashmir and Pakistan will have to accept that India under no pressure will give away Kashmir.the only solution now is to make existing borders as the actual borders and give up each others claim on others territory,and Pakistan will never agree to it,if they agree to live by it,this will be the compromise that Pakistanis will be making,and they will not make any.to this day they refuse to accept that they were defeated in wars against India, people who refuse to learn from their mistakes,who refuse to acknowledge the truth,who try to overshadow the truth with bunch of carefully crafted canard, are bound to commit the same mistake.if Pakistan had acknowledged the truth that they were defeated,then so much of war cry would have never existed.

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  17. All that is very good.

    We can take all the steps that we fill are good for relations between India and Pak AS long as they do not ignore the basic and fundamental fact of what is the foundation of Pakistan as a nation.

    It may appear trivial to some of us,but the antithetical basis of Pakistani nationalism vis a vis that of India has a very deep meaning for Pakistan.

    For them Pakistan can only exist and justify itself on the plank that its constituents never had or hand any hope under the idea of a secular ,united India.An etire history and line of thinking has been propagated over generations that goes beyond mere mis-trust or prickly relation.

    Kashmir for Pakistan is not merely a border dispute,it a question of religion, a sense of entitlement and a supposed logical outcome of the two nation theory.

    Lets have all the good relations with them,BUT never forget what they really are.

    India has no obligation to Pakistan or anyone else to improve relations.

    Our leaders must never forget that their main obligation its to India ,its security and its citizens.
    None of which is achieved by so called 'trust' moves with Pakistan or another so called 'stable Pakistan.'



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  18. such sentiments are commendable but lets be realistic. When the shit hits the roof people like this will be the first ones out of Pakistan. I bet that his children already have foreign passports making evacuation easier. The situation is the same on the indian side of the border. If there is war the elites (including bureaucrats and politicos) will be the first ones out of the country while the innocents will die as usual.

    Its always nice to talk peace but in the case of Pakistan such people never wield any real influence.

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  19. Shukla - Mansha seth is too optimistic. Lying in cahoot with Army and powerful politician served him well in Pakistan, but in India there are many many suitors - with how many he will be in bed and now days business of corruption is getting exposed too often.

    Every time he say trade, trade, replace it with trust, trust and trust. He funds same institutions and parties that fund, plan & instigate terror strikes on India. Let him set his shops in India, it will be fun burning them all.

    WE IN INDIA CONSIDER PAKISTANIS AS OVERZEALOUS RELIGIOUS FANATICS WHO ARE MORE ARAB than the ARABS themselves.

    Change direction of your country Mansha Seth that will see your business empire soar high. For India companies markets of far east, middle east and Africa are lucrative enough compared to backyard of Pakistan and Afghanistan. Amazingly, tone of this interview was as if we Indians are culprits of killing trade. Probably, in his arrogance Mansha seth has forgotten that Pakistan has been using terror as instrument of state policy. With advent of more trade, companies like this can be very well be used as front organization for economy sabotage, terror funding etc.

    Let islamic banking start in India and you will notice that MCB will be starved by Indian Banks in all international markets.

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  20. For those who support trade from Pak, read this article.
    105 kg of heroin and some ammunition were found out from the cement bags exported by Pakistan.
    Guys, Pakistan mentality against will not change just by doing some trade. The main intentions of Pakistan establishments are to destroy INdia. Of course, we Indians need to blame our corrupt leaders too. Without their support illegal things such as drugs and arms will not enter India.
    My cousin who used to work in IB told me once, Out of 100 Pakistanis enter India, more than 40 will have illegal things in his or her procession, mostly drugs, fake currency and arms.
    So what is the benefit India has by doing trade with Pakistan. In short not much in the current situation.

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  21. @ Anonymous 5 October 2012 08:58

    This is not a discussion forum and neither I have time or intentions to get in to an unresolved everlasting argument with you. I posted a reply to what you said in your previous comments. Its the Attitude which defines ground realities, do you think India is ever going to give Arunachal to China? Still China claims it and its Indians who starts shivering when it happens, what makes a difference here, attitude. Same goes with pakistan, the moment you accept they will not compromise, you have already lost your ground. I just hope Indian Bureaucrats don't have the same attitude. Now you can explain whatever you meant, but i posted for that particular comment of yours.

    ReplyDelete

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