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In Pakistan, the parameters of growth and development are perceived
in the narrow scope of hardware and finances. Development has to show
something concrete like a building structure and machinery or cash
flow volumes for it to be convincing and worth pursuing. Intangibles
like human skills, intellectual property and assets that are not enfranchised
by the documentation system are disassociated from development in
real terms, except as esoteric concepts that deserve lip service.
The obsession with physical resources over the past fifty years has
been totally eclipsing non-physical and intangible factors of growth
and development.
Quality, which is a very important element of productivity, meets
the same lukewarm concern as other intangibles like Human Resources
and Intellectual Property. Pakistan is certainly not known for quality
standards in any walk of life. In this column we will look at the
various dimensions of this critical element of life - quality. It
has three broad sources that drive its pursuit. One is purely out
of a sense of aesthetics, which are genetic primarily but are greatly
influenced by conditioning of circumstances. This sense is not limited
to creation of art works; it usually transfuses into everything a
person does - decorating a house, dressing up, style of playing host,
even dealing with people.
The second dimension is a mindset to strive for excellence in whatever
one does as a matter of habit; the motivational force behind it may
be anything. For example, Germans are obsessed with quality as a race
(an inner compulsion to be the best), the British have a sense of
professional pride to it; the French find it un-aesthetic to tolerate
bad quality, The Americans strive for quality with a Calvinistic morality
and the Japanese were the first make quality their national brand
recognition.
The third dimension is the empirical one where a regulatory framework
imposes mandatory standards of quality on goods and services for consumer
protection and transparency of business practices. This dimension
contributes to the large bulk of quality standards in the world, either
through mandatory imposition or through providing the accreditation
that provides the stamp of quality for premium pricing. With the growth
of global trade, rules and regulations have multiplied many folds.
Regulations relate to both tariffs and quotas (trade barriers) or
to standards defining technical, chemical, phyto-sanitary, copyright
and social compliance specifications for goods produced and traded.
The WTO is the mother organisation of the whole range of regulations,
standards and rules for global trade between countries and trading
blocks.
At the countries level, and even below at the local governments' levels,
there are a host of regulations pertaining to standards that determine
the overall quality of products and services produced in that particular
region. Generally, advanced countries have more stringent standards,
which accounts for better products and higher quality of life in general.
More so, the compliance to regulations and standards is more effectively
enforced in developed countries. In our part of the world the situation
is very different.
There is a common misconception in Pakistan that the government over-regulates.
There are a few task forces, studies, committees set up for 'deregulation'
of the economy. In fact, Pakistan is an under-regulated or ill-regulated
country. What are mistaken for regulation is 'controls' based on discretionary
powers or redundant criteria. There is a need to remove 'controls'
and revise regulations to bring them in line with contemporary needs.
For example, the Factories Act can drop the requirement of hanging
sand buckets in industrial buildings for fire controls and be satisfied
with fire extinguishers.
According to a news item, "Consumer Rights Commission of Pakistan
(CRCP) has expressed serious concerns over non-implementation of the
National Quality Policy of Pakistan and demanded its implementation
without further delay. It said that the policy level negligence towards
quality and standards has jeopardized the consumer safety in the country
on one hand and, is causing huge losses to the national economy on
the other hand. Pakistan's economy suffers an estimated loss of Rs.622
billion annually due to absence of quality control and standards in
different sectors."
The statutory standards are extremely weak in most of the areas -
food items, engineering and electrical goods, house utensils, building
materials, pharmaceuticals, cosmetics etc. Where there are standards,
enforcement is lacking. Since a very large number of the manufacturing
and services agencies (over 99 percent) dwell in the murky domain
of the informal economy, they cannot be brought under 'good corporate
governance' rules. A basic food item like milk has no standards defined
in the Food Act 1963. There is a vague definition but no standards.
Processed milk accounts for hardly 6 percent of the total sale of
milk in the country; the rest is left to unscrupulous middle men and
'gawalas' whose creativity in adulterating milk would have left Einstein
gasping for breath.
A strange anomaly of our regulatory system: punishment for adulterating
agricultural pesticides is one million rupees and six months imprisonment
(on successive offence) but for adulterating milk, there is a fine
of Rs 750 only. Not only that lack of standards causes health hazards
to domestic consumers, the mindset (mentioned earlier) for quality
does not develop for export orientation. Since quality standards hold
no premium, there are no laboratory facilities for testing, so no
one knows what is being produced and what is being consumed.
Even in a commodity like cotton lint, it took over ten years to get
the Cotton Standards Institute Ordinance passed through the assembly;
and now it has been passed there is no follow up to implement its
lint standards. With so much commotion about quality cotton, we do
not have testers and equipment to test and certify cotton bales in
the country. The same holds true for wheat, horticulture products,
livestock products and other industrial goods.
A National Quality Policy was formulated a couple of years ago, but
its fate has yet to be decided. The Pakistan Standards and Quality
Control Authority (PSQCA), the apex body for formulation, adoption
and enforcement of standards, has registered many standards, most
of which have been adopted from ISO. However, the Authority lacks
the capacity to enforce them. Similarly, the Pakistan National Accreditation
Council (PNAC) has been able to accredit only a handful of laboratories
so far.
This slipshod approach to quality standards has failed to provide
the environment where local entrepreneurs adopt a 'quality' mindset.
Foreign buyers dictate adoption of ISO and other social compliance
standards. The urge to strive for quality does not come naturally
to our society. On all three counts - aesthetic, mindset and regulatory
- society falls short. The Regulatory factor is the simplest and the
quickest to create; the other two will follow as standards rise.
But then a cynic may say, "the quality of governance is far from
satisfactory so how could it conceive of creating quality consciousness?"
It really is the egg or the chicken syndrome.
Iqbal Mustafa
1150 words
13 November 2004
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