Pakistan and Japan entered into progressive partnership soon after the World War II which ended in 1945 with Japan having suffered a major setback to its economy while Pakistan had emerged as an independent nation in 1947. Diplomatic relations between the two were established in 1952 but interaction between them had started much earlier. Japan is a major trading partner as well as a donor to Pakistan. Japan has been a member of the Aid to Pakistan Consortium since 1961 and has been regularly assisting Pakistan with its development programs by providing financial support. Standing as the third largest economy of the world, Japan has a nominal GDP of over five trillion Dollars, while that of Pakistan's nearly 250 Billion and fast growing. The annual development assistance from Japan to Pakistan over the years has gradually increased and now averages at Dollars 600 Million which includes project loans for infra-structure development, outright grant assistance for the development of social sectors such as Health and Education and technical assistance for the promotion of expertise and technology transfer. Japan is amongst the top donors of bilateral assistance to Pakistan. Total assistance to Pakistan so far is well in excess of Dollars 12.00 Billion and is funded through Japan International Cooperation Agency (JICA). Japan has been in the forefront to assist Pakistan with its development needs; examples of which include, but not limited to, Ghazi Barotha Hydropower Project, Modernization of Daudkhel Fertilizer Plant, Indus Highway, Jamshoro Thermal Power Station, Kohat Tunnel and numerous other in the social sectors such as construction of children's hospitals, providing equipment to basic health units throughout Pakistan, supporting technical and vocational education, improving supply of drinking water, helping improve environmental conditions and even modernizing safety measures at major airports and sea ports with state of the art screening equipment most of which are funded through outright grant-in-aid to Pakistan.
Karachi, historically being a commercial hub, Japanese entities were present even before Pakistan's independence with the first Trading Company being established in 1918 and the first Japanese Bank in 1925. Karachi was amongst the five major cities frequented by Japanese businessmen and clubbed together with New York, London, Hong Kong and Singapore. Currently, there are over 85 Japanese Companies now operating in Pakistan providing employment to over ten thousand and helping the government exchequer annually with over 60 Billion Rupees in taxes. In the industrial sector, Japan leads the automotive sector with almost all known Japanese brands with their presence; the first amongst them to start in 1980. To protect such investment and to further promote it, an agreement was signed between the two governments in 2002.
Pakistan-Japan Business Forum (PJBF) is a bilateral forum established in 2001 with a view to promoting trade and investments between the two friendly countries. To achieve this objective, the formation of its Board of Directors comprises ten Directors each from Pakistan and from Japan elected for a period of 3 years. Currently, it is led by Sohail P. Ahmed as its Chairman with Tetsuya Suematsu, the country General Manager of Marubeni Corporation as the Senior Vice Chairman representing the Japanese side. The Consul General of Japan in Karachi, Toshikazu Isomura (well versed in Urdu) is the Patron with the Ambassador of Japan in Islamabad, Kuninori Matsuda, as the Patron-in-Chief. Amongst the various activities of the forum is holding of events and inviting decision makers in the government connected to business matters which include the Ministers, Secretaries as well as CEOs of related organizations such as Trade Development Authority of Pakistan (TDAP), Board of Investment (BOI), Federal Board of Revenue (FBR) and the like. Members interact with them as it provides them with a platform to air their views and seek help on matters of interest to their businesses thereby directly bringing it to the knowledge of the concerned. Recently taking the lead, PJBF held an interactive session with the State Bank Governor Dr. Reza Baqir and invited other bilateral Business Forums to join. Participation in exhibitions such as Expo Pakistan under Japanese Umbrella, arranging trainings both in Pakistan and in Japan on specialized subjects, managing and linking trade delegations to visit Japan and interact with their potential counterparts as well as liaising with Embassies in both countries to ensure the maximum utilization of their presence for the business community, are amongst the few initiatives that are undertaken by the Forum. The Board of Directors of PJBF meets monthly to review progress in each sector it promotes. PJBF has also taken the lead to call upon all heads of Bi-Lateral Business Forums operating in Pakistan to jointly come up with a working paper highlighting issues common to all which can then be taken up with the government for remedial measures including for budget consideration by them.
The counter part of PJBF in Japan is Japan-Pakistan Business Cooperation Committee (JPBCC) and which is currently headed by Teruo Asada, the Chairman of Marubeni Corporation, and itself a conglomerate in Japan. Delegations between the two alternatively take place each year for what is called the "Joint Dialogue". Meetings are arranged for Government to Government (G to G) negotiations as well as Business to Business (B to B) interaction. The last such meeting was held in Tokyo in December 2018 with the Advisor to the Prime Minister on Commerce and Trade, Razzak Dawood leading a 25-member delegation. Deliberations took place at the Ministry of Economy Trade and Industry (METI). JPBCC is now expected to visit Pakistan in April for the Joint Dialogue which will primarily aim at discussing the progress since the last dialogue in Tokyo and to sign yet another memorandum of understanding reached after the deliberations and addressing the impediments standing in the way of trade and investments as well as the areas where support and contribution towards achieving it can be made by either side. Pakistan's Ambassador to Japan, Imtiaz Ahmed, is in regular touch with both JPBCC in Tokyo as well as with PJBF in Pakistan to assist in the matters of investments and improvement in trade; hence supporting the objective of Public Private Partnership, key to economic turnaround in any developing country.
Japan External Trade Organization (JETRO), operating under the Ministry of Economy, Trade and Industry (METI) of Japan was established in 1958. It opened its office in Karachi, the second overseas office anywhere in the world. In their published business directory of Japanese and Japanese Affiliated Companies in Pakistan, it mentions the names of almost 60 companies having either 100% ownerships or in Joint Venture with Pakistani companies. JETRO's prime objective, as the name implies, is to promote trade activities and encourage investments between Pakistan and Japan. Almost 200 companies are listed who are actively involved in business with Japan. JETRO in Pakistan is headed by a Japanese and has now a new chief, Kazu Yamaguchi replacing Osamu Hisaki who just returned last month after a successful stay of over five years in Pakistan.
There are three Japanese Associations of Commerce and Industry (JACI) located in Karachi, Lahore and Islamabad. The purpose of JAIC is to meet regularly, exchange notes in respect of trade and investments and convey to either governments their observations regarding business matters that need their attention. Japan's major imports from Pakistan include chemicals, yarn, textile products, leather and metals while Pakistan's major imports from Japan include automobile and automobile parts, steel, rubber products as well as a variety of machinery and Hi-Tech items. Investments by Japanese Companies during the last decade is close to a Billion Dollar. The Japanese Companies operating in Pakistan are realizing a sales volume of over Rs.300 billion. Recent investments into Pakistan by Japanese concerns are Yamaha Motors, NIPRO Corporation, Marubeni-Itochu Steel, Ajinomoto Corporation and Morinaga while several Japanese entities are looking towards Pakistan as a potential destiny. Imports from Japan is close to 1.5 Billion Dollars while exports from Pakistan stand a little over 200 Million Dollars; thus, tilting the trade balance heavily in favour of Japan. Nearly 800 Japanese are resident all over Pakistan which include those from Japanese business houses, Government of Japan, JICA, JETRO and also NGO's from Japan operating in Pakistan.
There have been several high-level exchanges of visits between Pakistan and Japan. Kentaro Sonoura, Special Advisor on Foreign Affairs to Prime Minister Shinzo Abe visited Islamabad where he called on Prime Minister Imran Khan and the Army Chief, Qamar Bajwa. Earlier he was in Karachi where he met with the members of PJBF and called on the Governor of Sind, Imran Ismail. Pakistan's Federal Minister for Economic Affairs, Muhammad Hammad Azhar visited Japan and met the Japanese State Minister for Foreign Affairs Kenji Wakamiya and PJBF's counterpart JPBCC. The two sides reviewed the entire spectrum of bilateral relations and identified areas for further cooperation in political, economic, trade, investment, education and cultural fields. Earlier at the Enthronement ceremony of the new Emperor in October, the President of Pakistan Arif Alvi, visited Japan. He held extensive meetings with the Japanese Prime Minister, with the delegation of Japan-Pakistan Parliamentary Friendship League and Japan Pakistan Business Cooperation Committee which included representatives from leading Japanese business corporations including Marubeni, Toyota Motors, Suzuki Motors, Mitsubishi, Sumitomo, Sojitz, Universal Metals and Mitsui & Co. Such exchanges and meetings have immensely contributed towards better understanding between the two friendly countries.
Ambassador Matsuda during his recent visit to Karachi and meeting with stake holders stressed upon three specific areas which he would like to see happen. Trade with Japan, Investment in Pakistan by Japanese Companies and Human Resource Development whereby Japan could invite skilled workers from Pakistan to Japan. Towards this a Memorandum of Cooperation (MOC) has also been signed. The emphasis should now be for goods and services from Pakistan to be exported to Japan as the trade imbalance is heavily in favour of Japan. PJBF and the Embassy of Pakistan (EOP) in Japan are encouraging SME's and have been successful in connecting Pakistani enterprises with that of Japan which has resulted from the several trade delegations taken by PJBF and received by our Embassy. The next delegation is planned to visit in April with emphasis on Information Technology. Commercial and Investment Counselor recently posted at the Pakistan Embassy, Tahir Cheema with immense exposure working at the Prime Minister's Secretariat and while meeting PJBF before his departure assured of his utmost efforts in linking the business communities of the two friendly countries.
Pakistan Japan Dosti Zindabad
The author is a founding member of Pakistan-Japan Business Forum and currently the Vice Chairman.