Pakistan has a comprehensive banking sector and a large pharmaceutical manufacturing base. Being one of the 6th most populous nations of the world and having a sub-tropical hot weather that greatly promotes diseases, which ensures a high demand for pharmaceutical products. I have a proposal that can benefit the pharmaceutical sector as well as our banking sector. Helping reduce their cost will help reduce poverty in Pakistan. If our banking sector offers their services to the pharmaceutical sector, it will not only help reduce the cost of medicines, it will also help increase revenue for the banks.

A relevant example is of Thailand, where the local petrol pumps had to purchase fuel from a distributor on credit. As the distributor could not provide high quantity fuel on credit, most of the petrol pumps would run out, resulting in missed sales, as well as reduced productivity of the country. To help resolve this, a local bank offered to take on the credit of 50 distributors of the fuel company. Since all the distributors were registered, and were to keep records by law, the bank found their business to be very safe.

A similar business model can be used in Pakistan, where pharmaceutical companies have been doing business with many distributors, each having documented their sale records. Pharmaceutical products are highly regulated, and do not have fluctuating rates, like many other commodities. Therefore I believe that banks, that are already providing finance to pharmaceutical companies, can help increase their business by providing finance to their distributors or even packaging suppliers.

This will not only expand the banking sector, it will also greatly promote the entire pharmaceutical sector, that involves not only the manufacturers, but also all other related business sectors, like the packaging industry, bottle industry etc.


Peshawar, August 8.