Future Roadmap for Industry of Surgical

Instruments of Pakistan

5/6/2011

Basit Rauf

Director TDAP

Sialkot

Table of Contents1. Profile of Industry2. Product HS Code3. World Exports of Surgical Instruments4. Export of Surgical Instruments from Pakistan5. Export Destinations6. Top Buyers of Surgical Instruments of World7. Support from TDAP for Surgical Cluster8. SWOT Analysis9. Value Analysis10.Vision11.Suggestions

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Profile of Industry

• Capital Investment: Rs 18 bn

• Size of Industry: 3000 units

• Employment: 500,000

• Single use instruments 80%

• Re-usable instruments 20%

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Product HS Codes

1 9018 31 Syringes with or with or without needles, parts accessories

2 9018 90 Instruments & appliances for medical surgical dental veterinary

3 9018 49 Dental Instruments and appliances

4 9018 50 Ophthalmic instruments

5 9021 Orthopedic appliances, bone plates/screws/nail, pacemakers

6 9402 90 Medical, surgical, dental furniture, similar chairs, operating tables, hospital beds, dentists chairs

7 8213 Tailor, barber &stationary scissors etc.

8 8214 20 Manicure and Pedicure instruments

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World Exports of Surgical Instruments Under HS Code 9018Value in Thousand US $

Source: UN Comtrade

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Country 2007 Share % 2008 Share % 2009 Share %

World 68,963,165 80,483,280 77,668,849

USA 17,254,160 25.02 20,051,360 24.91 20,137,423 25.93

Germany 9,923,722 14.39 11,371,553 14.13 10,531,688 13.56

Netherlands 5,437,067 7.88 5,866,095 7.29 5,767,732 7.43

Belgium 3,135,491 4.55 4,300,586 5.34 4,196,479 5.40

Japan 3,844,916 5.58 4,073,653 5.06 3,697,989 4.76

Ireland 2,130,545 3.09 3,320,008 4.13 3,123,952 4.02

France 2,722,657 3.95 3,184,646 3.96 2,970,150 3.82

UK 2,116,605 3.07 2,215,086 2.75 2,139,653 2.75

PAKISTAN 229,517 0.33 269,730 0.34 242,945 0.31

Exports of Surgical Instruments from Pakistan

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0

50

100

150

200

250

300

2005-06 2006-07 2007-08 2008-09 2009-10

Export M US $ 163

191

261250

229

Source: TDAP

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72% of our production is sold to

following eight countries of the

world:• USA 25.54

• Germany 14.66

• UK 10.67

• France 5.18

• Italy 3.87

• Brazil 2.37

• UAE 2.23

• Australia 2.08

• Japan 2.05

• Belgium 1.70

• Mexico 1.51

• Other partners 28.14

Source: UN Comtrade 2009

Export Destinations

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25.54

14.66

10.675.183.87

2.372.232.08

2.05

1.70

1.51

28.14

USA

Germany

UK

France

Italy

Brazil

UAE

Australia

Japan

Belgium

Mexico

Other partners

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Top Buyers of Surgical InstrumentsUS$ 000

Source: UN Comtrade

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Years2009 2008 2007

Sr.#Importer Trade Value Importer Trade Value Importer Trade Value

1USA $13,378,410 USA $14,279,915 USA $13,413,438

2Germany $6,598,303 Germany $6,763,912 Germany $5,869,553

3Netherlands $5,060,126 Netherlands $5,194,639 Netherlands $4,665,851

4Japan $4,317,509 Japan $4,464,992 UK $3,904,095

5Belgium $4,202,190 UK $4,343,674 Japan $3,811,695

6France $3,770,125 Belgium $4,129,994 France $3,440,566

7UK $3,691,046 France $4,094,313 Belgium $3,006,422

8Italy $3,009,872 Italy $3,085,571 Italy $2,763,139

9China $2,450,200 Russia $2,293,290 Spain $2,049,426

10Canada $2,086,066 Spain $2,224,431 Canada $1,940,078

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Support of Trade Development Authority of Pakistan to Surgical Instruments Sector

• Trade Policy Initiatives (Cluster Development Programme)

• Establishment of SIMTEL

• Support for Elimination of Child Labour

• Marketing Support

• Facilitation (CBI Training Programme)

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Strengths

•100 years history

• Well known in global markets

• Established distribution networks

• Wide range of products

• Flexible production systems

•Availability of cost effective skilled labour

SWOT Analysis

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Weaknesses

• Limited direct contact with surgeons (End Users)

• Inconsistent product quality

• Focus on low-tech, low quality, low value products

• Shrinking profit margins

• Informally trained work force

• Absence of work force for emerging technologies

• Lack of quality raw materials

• Absence of R & D

• Lack of linkages with academia

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Opportunities

• Rapidly Growing Market

• Demand of high tech products

• Rising demands in African and Asian markets

• Diversification into General Healthcare Industry

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Threats

• Emerging technologies replacing conventional instruments

• Market becoming highly regulated

• Diminishing skilled work force

• Inability to stay together

• Vendor Production Practices

• Compliance with labour, quality, social and environmental

standards

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TODAY TOMORROW

Conventional production methods, and

low value products

Modern techniques of production, high value

products

Lack of formal training at all management

levels (Top, Middle, First line)

Better skilled jobs; more productive workforce

“Cut throat” competition Stronger industry collaboration to improve

marketing & cater growing global market

Poor access to raw materials for hi-tech

products.

•In time availability of quality raw materials

•R&D for improving the quality of existing

materials & new materials development

Low value/ low margin products •Increased value addition

•High value/ high margins

Declining exports: Pakistan Market share

of total global market (less than 1%)

Achieve 1 Billion USD export target

Value Analysis

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Vision

A Paradigm shift

Low – Value

Conventional InstrumentsHigh – Value

Medical Devices$ $

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Suggestions

• Establishment of Surgical Instruments Training

Institute

• Establishment of R&D Cell in the Training Institute

• Establishment of Common Facility Centre

• Up gradation of SIMTEL

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Suggestions

• Minimum Export Price Fixation Regime (MEP)

• Support for Certifications

• Networking through Cluster Development

Programme

• Marketing

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THANK YOU

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