Dar says reserves will increase to $15-16 billion by end of September

[Hyde]

The reserve stand at 11.67Billion dollars as of last week

Add

*1.2Billion dollars from 3g/4g Auction
*2.5Billion dollars they are to get in May.

Total=15.37Billion dollars

Actually as per State bank of Pakistan, on 11th of April our reserves stood at 9849 million dollars. I couldn't find credible data after that... It's been 2 weeks since then

http://www.sbp.org.pk/ecodata/FER/2014/Forex-11-Apr-14.pdf

and you are mistaken. If the 3g/4g auction ends at 1.2 billion dollars, you expect to receive 50% in the next 30 days.. remaining 30% is going to be received in the next 5 years. So immediate increase in the reserves is only 600 million dollars.. And that we are not sure if the Government is going to keep in her reserves are PTA going to use it somewhere else

 

[VCheng]

Actually as per State bank of Pakistan, on 11th of April our reserves stood at 9849 million dollars. I couldn't find credible data after that... It's been 2 weeks since then

http://www.sbp.org.pk/ecodata/FER/2014/Forex-11-Apr-14.pdf

and you are mistaken. If the 3g/4g auction ends at 1.2 billion dollars, you expect to receive 50% in the next 30 days.. remaining 30% is going to be received in the next 5 years. So immediate increase in the reserves is only 600 million dollars.. And that we are not sure if the Government is going to keep in her reserves are PTA going to use it somewhere else

This number shuffling is being done to show that Pakistan has enough reserves to cover three months of imports, which is the cutoff required to be eligible for further IMF/WB loans, that is all.

 

[dawn_news]

The reserve stand at 11.67Billion dollars as of last week

Add

*1.2Billion dollars from 3g/4g Auction
*2.5Billion dollars they are to get in May.

Total=15.37Billion dollars

Pakistan will get 50% from auction, next 50% will come in instalments of 5 years if im not wrong. Another $1.5 billion gift is needed from Arabs, in return they can kill 4200 harami parindas.

 

[ziaulislam]

There is a detail program about floating bonds I hope I find the video if when you watch your mindset would change against this floating bonds. The basic direction is worst, where nawaz sharif and his brother needs to invest in hospitals, education, energy, oil-gas-mineral explorations...this government is spending like shiekhs on metro bus services go to Islamabad see the big board that says 50billion project metro bus do you honestly believe it? its not more than 6-8 billion there is nothing special about it. When your government is printing more money know that the direction of economy has curve going downwards.

Last if i were head of state first thing i would have done would be oust all foreign companies working in sectors exploring minerals, I would have bought machinery instead of renting and than trained local people to start working. Mark my words Pakistan can't dream big unless it explores all these iron, copper and gold and market it, there is nothing else left for Pakistan the service and other sectors are not good enough, we've got to jump in this Sector and not hand it over to foreign companies including China. If these two brothers were brilliant they would have formed committee and dedicated enough money to modernized Pakistan railways from ground up hand it over to China give them a deal % for say 5-7 years than reduce their profit and take over the charge we need ultra modern railway system imagine out of 19 crore population atleast 3 crore population travel monthly if they use modern railways services Pakistan can bag huge revenues PIA can than continue for mostly international-regional flights. If a person like me and you can come up with brilliant ideas why can't these rulers they can they just won't even so the costs are not huge their objectives is not to make Pakistan prosperous but to make it chaotic.

what i meant was shoring up reserves via bonds is not a bad decision as very low reserves creat unsuitability and panic in market based econmies.
pakistan simply cannot operate govt run enterprises because of some political parties and general public mind set. therefore we have no choice but to atleast privatize 25% shares of railways and PIA.
pakistan need to do joint ventures allow econmy growth will make anf dorm new companies, you cannot creaate companies out of the blue especially when you slaughtered them just a few decades ago in 70s.
otherwise govt will be losing 400 billion plus rupees annually, the lost is equivalent to building one mega dam every three years or enough to attain 90% education in 2-3 years.

 

[farhan_9909]

Actually as per State bank of Pakistan, on 11th of April our reserves stood at 9849 million dollars. I couldn't find credible data after that... It's been 2 weeks since then

http://www.sbp.org.pk/ecodata/FER/2014/Forex-11-Apr-14.pdf

and you are mistaken. If the 3g/4g auction ends at 1.2 billion dollars, you expect to receive 50% in the next 30 days.. remaining 30% is going to be received in the next 5 years. So immediate increase in the reserves is only 600 million dollars.. And that we are not sure if the Government is going to keep in her reserves are PTA going to use it somewhere else

Yes but the updated data was given in a press conference aswell as reported by many online media agencies.

APP Video Preveiw



Pakistani exports reach $16b: Dar | Pakistan Today

He said as of today, Pakistan has foreign reserves of $ 11.67 billion. He said we will achieve the target of $ 15 billion in foreign reserves by 30 September 2014.

Hence the reserve does stand at 11.67Billion dollars and the target of govt is certainly possible

 

[Hyde]

Yes but the updated data was given in a press conference aswell as reported by many online media agencies.

APP Video Preveiw



Pakistani exports reach $16b: Dar | Pakistan Today


Hence the reserve does stand at 11.67Billion dollars and the target of govt is certainly possible

oh I forgot about the bonds they are planning to issue

So yes raise that figure to above 14 billion dollars.. I am not sure if the foreign reserves are indeed reached to around 11.50 billion dollars as mentioned in that article. If it is, it's a good news for us of course.

I think touching the 15 billion dollars is not a big deal, we have even crossed 18 billion dollars of reserves in past. The key is to sustain it or go beyond 20 billion dollars. We have always touched 15-18 billion dollars in last few years but we could never sustain reserves and they start dropping as soon as you start paying back the loans you have taken or the pending payments to employees and the import bills.

 

[farhan_9909]

oh I forgot about the bonds they are planning to issue

So yes raise that figure to above 14 billion dollars.. I am not sure if the foreign reserves are indeed reached to around 11.50 billion dollars as mentioned in that article. If it is, it's a good news for us of course.

I think touching the 15 billion dollars is not a big deal, we have even crossed 18 billion dollars of reserves in past. The key is to sustain it or go beyond 20 billion dollars. We have always touched 15-18 billion dollars in last few years but we could never sustain reserves and they start dropping as soon as you start paying back the loans you have taken or the pending payments to employees and the import bills.

Last govt was different.If we cross the 15Billion $ mark in sept than hopefully by next year sept we would have also crossed the 20Billion $ mark.

Export has already picked up and the growth projections are also positive by Both World bank and IMF.Rupee sudden appreciation is also a plus point

 

[Hyde]

Last govt was different.If we cross the 15Billion $ mark in sept than hopefully by next year sept we would have also crossed the 20Billion $ mark.

Export has already picked up and the growth projections are also positive by Both World bank and IMF.Rupee sudden appreciation is also a plus point

I have not seen any indicator confirming increase in exports unless you show me one. Yes there has been 5-10% increase in exports on month by month basis but I am not sure if we will be able to sustain it for the whole year... and i am not sure why they said exports increased to 16 billion dollars.. how many months are they talking about as our year-to-year exports are well above 23 billion dollars figure. Some sources claimed to have it close to 26 billion dollars but I believe 23 billion dollars is a more credible source

 

[farhan_9909]

I have not seen any indicator confirming increase in exports unless you show me one. Yes there has been 5-10% increase in exports on month by month basis but I am not sure if we will be able to sustain it for the whole year... and i am not sure why they said exports increased to 16 billion dollars.. how many months are they talking about as our year-to-year exports are well above 23 billion dollars figure. Some sources claimed to have it close to 26 billion dollars but I believe 23 billion dollars is a more credible source

Exports increase 18% YoY – The Express Tribune

The export target for this year is 26Billion dollars

And the target is set at 50Billion dollars by TDAP

TDAP fixes exports target at $50 billion

 

[Hyde]

Exports increase 18% YoY – The Express Tribune

The export target for this year is 26Billion dollars

And the target is set at 50Billion dollars by TDAP

TDAP fixes exports target at $50 billion

Thanks for the first news

and please stop caring about TDAP in future if they really set the target of 50 billion dollars unless they meant to say after 5-10 years.

This year if we are able to achieve 26.50 billion dollars that is highly appreciated. We need to increase our exports to equally match imports if not above. Never reduce imports but increase exports... We are a nation of 200 million, our total trade volume should be in hundreds of billions of dollars.

 

[karan.1970]

Dar eyes forex reserves at $15bn by end-Sept - DAWN.COM

I am surprised at this person's lack of concepts (unless this was misinterpreted by the journalist). He is claiming to counterbalance the $2 billion increase in foreign debt (eurobond) by retiring $2 billion worth of local debt not realizing that the interest payments from the 2nd actually go back into the national economy but the interest payments from the 1st (7.75% which is significantly higher than what even countries like Sri lanka pay for such bonds) actually will diminish the forex reserves of the country since that money goes out of the country. By doing this swap while the national debt may remain same, the ratio of external to internal debt gets increased. Today, Pakistan's monthly CAD stands at approx $ 3 billion per annum. This 2 billion USD euro band will just increase that by another 5%

Not sure what are the terms of the Saudi Loan that has been received. It just seems Pakistan is largely repalacing a weak forex situation with a weak external debt one, in a hope that increased exports down the line will help fill the hole. Risky strategy, but certainly feasible if the negative sentiment driven by terrorism etc is kept in control

 

[dawn_news]

I am surprised at this person's lack of concepts (unless this was misinterpreted by the journalist). He is claiming to counterbalance the $2 billion increase in foreign debt (eurobond) by retiring $2 billion worth of local debt not realizing that the interest payments from the 2nd actually go back into the national economy but the interest payments from the 1st (7.75% which is significantly higher than what even countries like Sri lanka pay for such bonds) actually will diminish the forex reserves of the country since that money goes out of the country. By doing this swap while the national debt may remain same, the ratio of external to internal debt gets increased. Today, Pakistan's monthly CAD stands at approx $ 3 billion per annum. This 2 billion USD euro band will just increase that by another 5%

Not sure what are the terms of the Saudi Loan that has been received. It just seems Pakistan is largely repalacing a weak forex situation with a weak external debt one, in a hope that increased exports down the line will help fill the hole. Risky strategy, but certainly feasible if the negative sentiment driven by terrorism etc is kept in control

Actually Dar said Goverment will save $90 million every year by doing this.

 

[ashok321]

Pakistan spends $3 billion on debt servicing annually alone, not taken into account.
What about that?

 

[ziaulislam]

I am surprised at this person's lack of concepts (unless this was misinterpreted by the journalist). He is claiming to counterbalance the $2 billion increase in foreign debt (eurobond) by retiring $2 billion worth of local debt not realizing that the interest payments from the 2nd actually go back into the national economy but the interest payments from the 1st (7.75% which is significantly higher than what even countries like Sri lanka pay for such bonds) actually will diminish the forex reserves of the country since that money goes out of the country. By doing this swap while the national debt may remain same, the ratio of external to internal debt gets increased. Today, Pakistan's monthly CAD stands at approx $ 3 billion per annum. This 2 billion USD euro band will just increase that by another 5%

Not sure what are the terms of the Saudi Loan that has been received. It just seems Pakistan is largely repalacing a weak forex situation with a weak external debt one, in a hope that increased exports down the line will help fill the hole. Risky strategy, but certainly feasible if the negative sentiment driven by terrorism etc is kept in control

you are right about 1st thing but he meant money saved by the "govt"
Saudi loan is a grant so not a loan , its not surprising since they pump billion of dollars else where too.
laslty pakistan need to build it reserves quickly to atleast 20 billion dollars in short term to avoid instability, it doesnt matter how they build it (unless its a very short term loan like iMF stand off), pakistan debt to gdp ratio isnt bad so it can afford to do so, problem was that in past govt didnt got a good reply in bond market, even this time it was expecting only 500 million and it got 2 billion.

 

[karan.1970]

you are right about 1st thing but he meant money saved by the "govt"
Saudi loan is a grant so not a loan , its not surprising since they pump billion of dollars else where too.
laslty pakistan need to build it reserves quickly to atleast 20 billion dollars in short term to avoid instability, it doesnt matter how they build it (unless its a very short term loan like iMF stand off), pakistan debt to gdp ratio isnt bad so it can afford to do so, problem was that in past govt didnt got a good reply in bond market, even this time it was expecting only 500 million and it got 2 billion.

See, the issue is not debt to GDP, but the external debt to forex reserves. This ratio stands at close to 6 and by beefing up forex reserves by adding loans, Pakistan runs a risk of further deteriorating its CAD due to increase in loan servicing costs. The answer still boils down to increasing exports to counter balance that and if that comes under threa, this could prove to be a very expensive strategy