Abdul Basit used to sell insurance before switching over to the poultry business in 1985. Today, his six companies turn over Rs12bn in sales every year, employ more than 3,000 people, and pay taxes to the tune of Rs300m.

That’s not all. Sales are expected to double in the next 2-3 years once the Rs4bn chicken meat slaughtering and processing plant in Lahore — the largest and most modern facility of its kind in Pakistan — becomes operational this summer. It’s quite a remarkable achievement for a man who had begun his business with a small sum of Rs10m, including a bank loan of over Rs7m.

“We started our business with a parent stock of 12,000 birds. Now we have over 1m birds and we have been the market leader for the last 25 years, with a share of around 60pc,” the chairman of the Big-Bird Group of Companies said in an interview with Dawn. His group also owns the world’s largest grandparent hatchery, the technology his company brought to Pakistan in 1989.

At that time, the country had a parent stock of 1m birds and was forced to import to meet its poultry meat requirements. The transfer of the grandparent technology helped start local breeding of the parent stock, whose size has now grown to 12m birds.

“It is not incorrect to say that with all foreign airlines having left Pakistan, we would have been starving for poultry meat today if our company hadn’t brought the grandparent technology for local breeding,” he contends.

Pakistan’s Rs700bn poultry industry produces 1.25bn broiler chickens a year and provides jobs to 1.6m people across the country. Almost 73pc of its capacity is located in Punjab.

Basit is not happy with the government’s rather ‘adversarial’ attitude towards one of the country’s largest industries that has an enormous potential for growth. “The entire focus of our policymakers is centred on textiles. They just don’t realise what our poultry sector can do for the economy if the government holds its hands for a while.”

Pakistan’s Rs700bn poultry industry produces 1.25bn broiler chickens a year and provides jobs to 1.6m people across the country. Almost 73pc of its capacity is located in Punjab

The global halal food trade has expanded to $3trn, and Pakistan has virtually no share in it. The majority halal food supplies are coming from places like China, Thailand and Brazil etc. “Why can’t we lead the halal food trade? Our poultry products can fetch export revenues of $12-15bn in just 2-3 years if the government decides to help and develop the poultry meat processing industry,” Basit argues.

Currently, only 3pc of the 6m-kilogramme poultry meat produced daily in the country is being processed at four slaughtering and processing facilities. The industry players blame the situation on high credit cost, taxes on import of machinery and raw materials (like spices used by poultry meat processors) as well as on their sales, and cheaper, duty-free import of processed poultry products from China and elsewhere.

“The slaughtering and processing industry is very capital intensive. At the same time, it has many advantages and benefits for the economy. It will create millions of new jobs [his own plant will create 3,000-4,000 direct jobs when it becomes fully operational] and push poultry-product exports,” he says.

“We want the government to ensure zero-rating of our exports and give us an incentive package on the lines of the one given to the textile industry to grow the share of processed poultry meat industry by 40-50pc.”

He feels that the government’s policies toward the poultry sector tend to focus more on collecting tax revenue rather than creating new jobs and providing inexpensive, quality and healthy food to the people. Chicken meat consumption in Pakistan is estimated to be 6.5kg per person per year, far below 41-65kg in developed countries.

“Unless this attitude changes, the industry and consumers will both continue to suffer due to price volatility and unsafe meat sold on the roadsides.”

According to him, poultry farmers lost Rs43 per kg of chicken meat in the past year amid the worst slowdown in sales in 30 years. While the dwindling purchasing power of people over the last couple of years because of rising costs of energy and other essentials was a major factor, the disruption to supply chain during the months-long protest of the PTI and the recent petrol shortage in Lahore and elsewhere in Punjab had also contributed significantly to the slowdown.

At present, 40pc of poultry farms in Punjab have closed down because of losses. “If we’re able to develop our chicken-meat processing industry and increase our exports, our domestic market will also stabilise,” he says.

Poultry meat prices had risen 403pc in the last 20 years, compared with an 800pc increase in wheat prices and more than 700pc surge in beef and mutton rates, he says.

“Remember how the bird flu scare in 2004 had pushed mutton and beef prices? Our prices are lowest in the world as of today. Still, the official focus is on somehow getting chicken rates reduced. They are not aware of the ground realities. If [poultry] farmers continue to lose money on their harvests, they will shut down their farms. Who can bear massive losses for such a long period?” Basit wonders.

Published in Dawn, Economic & Business, February 16th, 2015

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