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Analysis of the Silk Value Chain in Pakistan

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Analysis of the Silk Value Chain in Pakistan ANALYSIS OF THE SILK VALUE CHAIN IN PAKISTAN Dr. Sabahat Akram University Management Sciences and IT Kotli Azad Kashmir. Abstract - There is a great potential to develop sericulture and silk industry as an economically viable rural /urban avocation in Pakistan as it is highly labor intensive and combines both Industry and agriculture. It generates self employment, gives quick returns on low investment and is a source for exports and foreign exchange earnings. Objective and scope of this exploratory research are the mapping and value chain analysis of silk sector right from sericulture to value added silk products in Pakistan. This research study will based on both quantitative surveying of sericulture related establishment and silk enterprises in all over Pakistan as well as qualitative data and validation of analysis by the stakeholders. Mapping exercise will include Background, Objectives, Market Analysis, SWOT Analysis for Pakistan This study will help not only in presenting SWOT analysis of this potential sector but also highlight factors limiting the growth of the sector. It will also be useful in providing an understanding of complete process to the policy makers for poverty reduction and tackling unemployment. And it will serve as database for short term and long term planning and future research. Keywords: Sericulture, Silk, mapping of silk sector, value chain analysis Paper type: Research(exploratory) Paper (in MS Word format) LIST OF TABLES AND FIGURES Table:1 Top five Exporter of Silk and Pakistan Table:2 Top five Importers of Silk and Pakistan Table:3 Comparison Of import Tariffs of Pakistan and competing countries Table 4: Year wise production & Distribution of sericulture Produce Figure-1 Sericulture process Figure 2: Global Production of Raw Silk in tons Figure 3:Total Trade share of top Five countries and Pakistan Figure 4 : world Price trend of Silk Yarn Figure5: Total silk Imports and Exports of Pakistan Figure 6: Percent share of Silk imports Title: PEST ANALYSIS OF THE SILK VALUE CHAIN IN PAKISTAN I. INTRODUCTION The history of silk dates back to earlier civilizations existed on the planet. The Chinese has used silk since the 27th century B.C. Romans and called China as “SERES”, the country of silk. Today the sericulture is being practiced in around fifty countries. China, India, Korea, Japan, Turkey Brazil and the Central Asian states have attained specialization in sericulture technology and silk production.(ref) @IJMTER-2015, All rights Reserved 223 International Journal of Modern Trends in Engineering and Research (IJMTER) Volume 02, Issue 08, [August– 2015] ISSN (Online):2349–9745 ; ISSN (Print):2393-8161 Sericulture and silk production Industry is highly labor intensive and combines both agriculture/forest and Industry. It generates self employment for the rural unemployed population, gives quick returns on low investment and is a source for raw material , exports and foreign exchange earnings. The Silk sector in Pakistan is very much unorganized and fragmented. It consists of small scale cottage industry and unorganized manufacturing clusters. Unfortunately there is no cohesion and coordination among different segments of silk value chain because sericulture is dealt by Forest department and silk sector by Ministry of textile. There is a great potential to develop sericulture and silk industry as an economically viable rural /urban avocation in Pakistan due to salubrious climate conditions suitable for mulberry cultivation and silk worm rearing. And even it can play an important role in checking migration from rural to urban areas and creating new job opportunities by providing supplemental income to unemployed population in their native places. In addition sericulture is best use of natural resources and is very environmentally friendly activity. This paper will present mapping and development strategies for cluster-based silk value-chain through PEST(political, economic, social and technological) analysis of the silk sector in Pakistan. The study attempts to present the situation analysis of the sericulture and silk industry in Pakistan, its trends, position in global scenario. Critical issues of future potentials and role of the sector in national economy, employment generation specially for women empowerment and rural development, were also explored. An attempt is also made to develop an action plan to establish and strengthen sericulture and silk industry in Pakistan and Creation of backward and forward linkages for the silk sector. This concept paper would be use in establishing and recognizing the potential, strength, weaknesses and challenges of the sericulture industry in Pakistan and serve as data base for policy makers to formulate and adopt policies for employment generation and Boost up export of silk products. 1. Research Objectives This research study is being launched with aims to attaining following specific objectives. Analysis of forest/ mulberry plantation strategies suitable for sericulture • Defining Basic Sub-sectors Features of silk industry in Pakistan • Mapping of the Silk value chain in Pakistan • Market Analysis for silk sector • Pakistan Silk Situation Analysis • PESTLE Analysis for silk sector of Pakistan • Development, promotion and extension strategies/interventions for the silk sector. 2. Research Problem Locating and evaluating the potentials of silk value chain of Pakistan. 3. Rationale for the Study Silk value chain is selected for this research study of mapping and developing strategies for the sector through PESTLE analysis because sericulture / silk industry is welfare-oriented, labour-intensive, village-based cottage industry, which generates self employment and reduces urban migration. Bring closer the different stakeholders closer and work with coordination for cohesion of the silk sector. The general purpose of this research study will be develop an insight into Pakistan cottage based agro industry and accessories sub-sectors, the main players (farmers, rearers reelers, weavers and exporters), and a breakdown of generated value. provide an updated overview of the actual situation of the Pakistan silk sector and its competitive ness. @IJMTER-2015, All rights Reserved 224 International Journal of Modern Trends in Engineering and Research (IJMTER) Volume 02, Issue 08, [August– 2015] ISSN (Online):2349–9745 ; ISSN (Print):2393-8161 identify untapped opportunities and threatening constraints along the supply chain. collect and analyse valid baseline data for the first time for the whole of Pakistan. develop intervention ideas for public and commercial service solutions; and The study will be the basis for proposing interventions and strategies designed for the growth of the sector and to overcome the gaps identified. Literature Review The history of silk dates back to earlier civilizations existed on the planet. The Chinese has used silk since the 27th century B.C. Romans and called China as “SERES”, the country of silk. Today the sericulture is being practiced in around fifty countries. China, India, Korea, Japan, Turkey Brazil and the Central Asian states have attained specialization in sericulture technology and silk production.(ref) Many Latin American countries developed their sericulture sector through promotional policies. In Argentina a law was enacted in 2004 to accelerate sericulture activities like wise Bolivia and Colombia, started many USAID and GAT and EU funded sericulture projects to up sericulture activities and strengthen the silk sector.2 likewise developing countries like Cambodia (Cambodia Trade Integration Strategy 2007)3 and Thailand (Agri food Consulting International, 2005)4developed their silk sector through various support programs for the integrated silk value chain. Although agriculture-led growth often proved to be powerful vehicle for braod povery reduction (DeJanvry and Sadoulet,2009 Chirstiaensen; Demery and Kuhl,2010)5. Yet it can reap further benefits and agriculture growth if its value chain is extended to agriculture marketing and agro based processing industry (Abbott,1986)6. Creation of value chain permits specialization and enable product diversification to high value products and other value added activities. Value chain analysis is a framwork for establishing the structural connective point among inputs processes and outputs then outcome. Silk value chain is a series of linkage points among small farmers with inputupplies , processors, traders and final consumers. Value chains analysis provide a diagnostic tool for identifying viable, remurnertive opportunties for poor rural population in developing world. In this era of globalization with highly comparative markets the developing countries must find small niches in which they can compete in the rapidly grwoing local and export market (Haggblade, et.al, 2012)7. In this regard Michael E Porter’s value chain model(Porter, 1985)8 dividies specific activities necessary for orgnizatoin for gaining competitive advantages and building their value into two: primary and support activity. ILO in its various reports has also addressed the basic question of what value chains are and that how value adition can be achieved in it and opportunities can be created for rural and urban population for more employment and better working conditions in value chains (ILO, 2009)9 Henderson Et al points out that Value chain analysis is a process which should starts with linear mapping of series of activities in the chain from initial input supplier to final supplier to final consumption
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