Pakistan Economy - News & Updates - Archive

[Owais]

PM urges early finalisation of IPI gas pipeline project


ISLAMABAD (updated on: January 12, 2007, 18:37 PST): Prime Minister Shaukat Aziz on Friday said Pakistan valued its relationship with Iran and emphasised for strengthening the existing affinity between the two countries by expanding economic ties.

The prime minister was talking to Dr. Kamran Bagheri Lankarani, Iranian Minister for Health and Medical Education who called on him at PM House here.

Prime Minister Aziz expressed the hope that setting up of Pak-Iran Investment Company and signing of the Preferential Trade Agreement (PTA) would boost trade and economic ties between Pakistan and Iran.

Aziz said Iran was Pakistan's important neighbour and the two countries enjoyed long and lasting relationship based on common faith, shared history, heritage and values.

The prime minister said as a result of high growth and economic turnaround achieved by Pakistan, the energy needs of the country were growing and Pakistan desired to enhance co-operation with Iran in the energy sector.

Pakistan, the prime minister said, was keen to increase the import of electricity from Iran.

The prime minister also emphasised the need for early finalisation of Iran-Pakistan-India (IPI) gas pipeline on terms and conditions feasible for all parties.

The prime minister talked of the golden period of Islamic history when Muslim scientists and physicians were involved in serious research and advanced new theories in various scientific disciplines, which paved the way for later discoveries and inventions.

He said the Muslim world needs to invest in education and research to build knowledge economies. This will guarantee their economic development, sovereignty and independence in decision making, the prime minister added.

The prime minister said as a result of the reforms undertaken by President General Pervez Musharraf seven years ago, the economic and social landscape of the country has significantly improved.

"Today's Pakistan is different from the Pakistan of yesterday. People have pride in their country and nationhood," the prime minister said.

The government, the prime minister said, believes in development with dignity and growth with equity.

The prime minister said Pakistan recognises Iran's right to use nuclear technology for peaceful purposes under IAEA's safeguards but is opposed to nuclear proliferation.

Talking of the health sector reforms, the prime minister said the government was focusing on preventive and curative steps and had launched a number of awareness campaigns to eradicate diseases.

He said the government was committed to Millennium Development Goals (MDGs) to provide better facilities of health to the people.

Dr. Kamran Bagheri Lankarani expressed appreciation of the Iranian government for Pakistan's stand on various regional and international issues and said this was contributing to regional peace and safety.

He said while Pakistan and Iran had close relations, the trade and economic co-operation needed to be enhanced for the benefit of the two countries.

Dr. Kamran Bagheri Lankarani said the two countries needed to create linkage in various areas of biotechnology and said Iran was ready to help Pakistan in vaccine production.

Dr. Kamran Bagheri Lankarani said Iran was keen to finalise the Iran-Pakistan-India gas pipeline project and was taking steps in that direction.

The meeting was attended among others by Minister for Health Mohammad Nasir Khan and senior officials.

http://brecorder.com/

 

[Owais]

Pakistan gets another $600 million export orders as Bangladesh situation worsens

KARACHI (January 13 2007): The ongoing political uncertainty in Bangladesh is expected to fetch further $500-$600 million textile deals for Pakistani exporters, said Textile Minister Mushtaq Ali Cheema while talking to Business Recorder on telephone from Germany.

The Minister, who is currently representing Pakistan at Heimtextil exhibition being held in Frankfurt, Germany, also confirmed that Pakistan had also obtained potential export orders worth $500 million, following political unrest in that country.

"Yes, our (Pakistan) export-oriented textile industry has caught a number of those foreign orders which were previously used to be placed in Bangladesh," he confirmed. Cheema said that general election process is underway in that country which has turned into riots and deteriorated the law and order situation there. Consequently, the buyers eyed Pakistan for timely completion of their big orders.

"The exporters of Bangladesh have been dispatching late shipments since October 2006, which had raised the eyebrows of the buyers in Europe and United States," the Minister added.

"I am currently attending Hemtex exhibition here in Germany and found Bangladeshi exporters anxious about their country's law and order situation because they have failed to give right time to their buyers for the export shipments" he remarked.

He said that if the law and order situation did not improve in Bangladesh, "we are expecting more international orders from European and US markets in the next few months, which would be approximately $500-600 million".

He said: "We are also not happy with the ongoing political chaos in Bangladesh but the whole situation is in our favour, and international buyers prefer us for placing orders, against Bangladesh." Due to the political instability, a small number of Bangladeshi exporters had been seen in the exhibition, and they failed to convince the buyers, he added.

About the exhibition, he said that this year there is no price war in the Heimtaxtil exhibition, "as we were expecting, and our exporters are quoting 2 to 3 percent high prices as compared to last year".

He said that the relief package for the exporters in the shape of 5 percent research and development assistance had provided support to the exporters and now the country's textile exporters are getting orders. "We are trying to decrease the cost of doing business, which will make our textile industry more viable in the international market," he added.

http://brecorder.com/index.php?id=516781&currPageNo=1&query=&search=&term=&supDate=

 

[Neo]

$5 billion annual marble export possible: expert

KARACHI (January 13 2007): Pakistan has the potential to export $5 billion marble and stone products annually by providing basic infrastructure to this industry.

Sanaullah Khan, Chairman All Pakistan Marble Mining Processing Industry and Exporters' Association (APMMPIEA) told Business Recorder that lack of basic infrastructure had hampered to explore the real potential of this industry which could contribute $5 billion exports towards national economy.

He said that currently the industry was growing at the rate of 25 percent annually and the exports up to December 15, 2006 crossed $35 million as compared to less than $20 million of previous years. Only first six months of 2006 exports of marble had touched $18 million, he added.

Sanaullah said that the industry was growing on self-reliance basis without any government support. "No infrastructure is provided to miners in the country and about 3,500 units are working without water and electricity," said Sanaullah.

He said that the Pakistan's marble and stone exports had reached to 52 countries, including USA, Italy, Saudi Arabia, China, but its export share in the world market, estimated at $42 billion, was less than one percent.

Sanaullah said that it was not possible for the extractors to import modern machinery, which costs millions of rupees to extract and produce finished products.

In the absence of basic facilities such as roads, electricity, water, etc at the extraction sites, the majority of which were located in the remote areas, were also a major impediment in carrying out the mining activities in the country, he added.

The marble processing industry in Pakistan was around 40 years old and the first major marble deposits were discovered at Mallagori and Swabi in the NWFP. During the last 15 years, a number of processing units were established in the country and the majority of them has used locally manufactured machinery, he said.

He added that on the government level the industry was given consideration for last ten years after rising in world demands. Previously, the government had neglected the industry, which resulted in closure of several small units, he said.

The government had planned to set up four marble cities in the country and announced that the leases would be awarded to the genuine extractors, he said. They are being given contracts against the rules on nepotism, he alleged.

He said from March 2005 to April 2006, an estimated 14 million ton marble and 21,000 tons of granite was excavated from Swat district, Bajaur agencies, Lucky Marwat, Bela, Khuzdar and Loralai in Balochistan and Jungshahi and Bado Jabal in Sindh.

He said that the marble and granite were among the major minerals extracted in Pakistan after coal, rock salt, limestone and China Clay. A source in the marble manufacturing industry said that the foreign investors were reluctant to invest in the sector in the three provinces ie Sindh, Balochistan and NWFP because the mining sites were located in far-flung areas off the main cities and had the deteriorated law and order situation.

The present government had taken some initiative for improving the situation, which would help bring foreign investment in this sector, he hoped. A senior government officials said that the government had planned 10 model quarries at the cost of Rs 900 million to minimise the 70 percent marble stone damages which occur during mine operations due to lack of such technology.

The official also informed that the latest study had unveiled about 17 billion tonnes of granite only in Sindh and steps needed to explore the industry. The official said that government wanted to extract the minerals with the help of modern technology to minimise damages occurred during mining.

The damage resulted in small pieces of stones, which had low value in the world market and our efforts were being made to bring the latest machinery and foreign experts in this field to get better results. In this regard an Italian company had shown intention to set up plant for finished products in the country, the official apprised.

http://www.brecorder.com/index.php?id=516818&currPageNo=2&query=&search=&term=&supDate=

 

[Neo]

Karachi has attracted $1 billion FDI: Mustafa

KARACHI (January 13 2007): Karachi has attracted $1 billion out of $3.8 billion foreign direct investment in the country, which shows the confidence of investors on the city. Syed Kamal Mustafa, Nazim, Karachi City District Government (CDGK) said this at the inaugural ceremony of the IAPEX-2007, organised by Institute of Architects, Pakistan (IAP), here on Friday.

The Nazim said that the city had attracted $one billion FDI, which was 26 percent of total investment, so its our duty to make the city more attractive for further economic activities. He said that the city government had materialised the fourth master plan.

In the past three plans were made but none of them could be started, he added. Karachi has 180 million population and is the biggest city of the country. The city generates about 68 percent revenue and having two ports. It is the hub of all financial activities.

The city also links the country with other countries of the world. The nazim invited people from local and abroad to come forward and participate in development works. He said a huge infrastructure was required for the big population.

People engaged in the construction industry had opportunities to take part in the speedy uplift projects in the city. On the occasion Ejaz Ahmed, President IAP said that the IAPEX-2007 was organised to bring professional architects, engineers and builders in direct contact with manufacturers and dealers of building products. The exhibition was an ideal forum to introduce new materials.

He said concurrent with the exhibition was the three-day international Architectural Forum with the theme of 'Emerging Architecture'. Renowned architects from over 10 countries would present papers, he added. This was an excellent opportunity for our architects and architecture students to listen and interact with the luminaries of the profession, he added.

http://www.brecorder.com/index.php?id=516819&currPageNo=2&query=&search=&term=&supDate=

 

[Neo]

China offers solar, wind energy technologies

LAHORE: Chinese ambassador to Pakistan Zhang Chunxiang has said that China can transfer its solar and wind energy technologies to enable Pakistan speedily overcome the power shortage that is impeding its growth potential.

Speaking at his farewell visit to the Lahore Chamber of Commerce and Industry on Friday, he said China gives special preference to Pakistan in all fields including trade.

The ambassador said this is evident from the fact that Pakistan is the first country with which it signed a free trade agreement in South Asia. Moreover, he added, out of the eight special economic zones that China established outside its territory the first is being established near Lahore.

He urged Pakistani businessmen to take full advantage of free access to Chinese market and increase their exports. He said many Chinese entrepreneurs are looking to establish joint ventures in Pakistan. He asked the local entrepreneurs to identify the feasible projects and negotiate with their Chinese counterparts. He hoped, from now onwards, the trade between the two countries would double every year.

He said he would discuss with Prime Minister Shaukat Aziz on the ways to increase bilateral trade between the two countries. He said China is ready to share the technology of the newly developed color cotton variety with Pakistan. Similarly, he added, Pakistan could benefit from varieties of high yield cotton, basmati and other agriculture products.

He said Chinese airlines are negotiating with Pakistani authorities for operating flights from major cities of Pakistan to various destinations in China. Similarly, he added, PIA has been approached to increase direct flights to major Chinese destinations. He said low prices of Chinese products are mainly due to economies of scales obtained through high technology machines. Moreover, he added, labour in China is comparatively cheap. He dispelled the notion that energy cost in China is low. He said energy cost in China are the same as in Pakistan or little higher.

Speaking on the occasion, the LCCI Acting President Yaqoob Tahir Izhar said that Chinese investment is likely to increase in the near future significantly. Government of Punjab has allocated 500 acres of land to China National Power Ltd in Faisalabad Industrial Estate (FIEDMC) to establish an industrial area including 50 megawatt power project. An exclusive Chinese Industrial Park is also being developed at Lila on Lahore-Rawalpindi Motorway near Rawalpindi. He said that some Chinese auto manufacturing companies have also shown interest in manufacturing of tri-wheelers and buses in Pakistan. Izhar said that there are ample opportunities for Chinese investors to invest in Pakistan. Pakistan’s investment policies are based on the key elements of liberalisation, privatisation and deregulation.

http://www.thenews.com.pk/daily_detail.asp?id=38662

 

[Neo]

Saturday, January 13, 2007

Pak rupee overvalued by only 1%-2%: Merril Lynch

KARACHI: The Pakistani currency is expensive but only to the tune of around 1%-2%, said a research report released by Merrill Lynch, a multinational investment company.

“In our view, the Pakistan rupee does not need to devalue by 10 percent as recommended by the International Monetary Fund, the report said.

The report said: “Foreign ownership remains low at around 6-7 percent (Thailand’s foreign ownership is closer to 40 percent and we wonder which market has more risk).

“Equities in Pakistan have significantly under-performed to the tune of 24 percent. Over the last 12 months, equities within the MSCI Pakistan Index have fallen by around three percent.

“Pakistan’s de-rating against the regional index has been severe over this period, but the market now commands a 2007e PE multiple of 8.5x with EPS growth of +13.9 percent. “Within the sub-continent, Pakistan’s equities look exceptional value when compared with the higher multiples in India.

“Lately, the market has sold off sharply due to a number of unlikely rumours. We think the sell-off is unwarranted and expect the KSE-100 to rise due once the following rumours fail to materialize. “The State Bank of Pakistan is unlikely to introduce a minimum deposit rate of four percent (in order to lower net interest spreads). Spreads, however, have already peaked now that deposit rates are rising. Furthermore, it would reverse five years of financial reforms and deter foreign direct investment.

“The general election in 2007 is unlikely to alter the irreversible path of Pakistan’s reforms. All parties are pro-reform and have been for the last 10 years, regardless of which party was in power.

“Merrill Lynch Pakistani strategist Imtiaz Gadar recently raised his market target for the KSE-100 Index to 11,000 based on our analyst price targets.”

http://www.dailytimes.com.pk/default.asp?page=2007\01\13\story_13-1-2007_pg5_3

 

[Owais]

Pak-Iran joint ventures in pharmaceutical sector likely

LAHORE (January 14 2007): Iranian Health Minister Dr Kamran Bagheri Lankarani has said that Pakistan and Iran could initiate joint ventures in pharmaceutical sector, as both the countries have strengths and capacities in many areas, which were neglected in the past.

The Iranian Minister was speaking at the Lahore Chamber of Commerce and Industry (LCCI) on Saturday. Iranian Ambassador in Pakistan Mohammad Ebrahim Taherian, LCCI Acting President Yaqoob Tahir Izhar, Vice President Mubasher Sheikh and former President Mohsan Raza Bukhari and former Senior Vice President Sohail Lashari were also present on the occasion.

Dr Kamran Bagheri Lankarani maintained that Iran has over 40 percent purified pharma raw materials, which are locally available and this provides a huge opportunity to Pakistan that could evolve cheaper and efficient solutions by getting these raw materials from Iran instead of any third country. He offered his help for making Pakistan a polio-free country.

While acknowledging Pakistan's expertise in pharma sector, the Iranian Minister said that Pakistani scientists should collaborate with the Iranian industry for getting better results in future. He said that both Pakistan and Iran are very strong in the field of herbal medicines with knowledge of 7000 medicines while presently both the nations are producing only 2500 drugs, so there is a huge scope available in this particular area. "These herbal medicines could be exported to Europe, as they have only 200 herbal drugs," he added.

While appreciating Pakistan's Ministry of Health efforts for preparing anti-cancer drugs, Dr Kamran Bagheri Lankarani said that Iran needs Pakistan assistance in this sector. Biotechnology is future of pharmaceutical industry and Iran has sufficient knowledge so it is ready to cooperate with Pakistan, he added.

Speaking on the occasion, LCCI Acting President Yaqoob Tahir Izhar called for concerted and sector-specific efforts to increase the volume of two-way trade between Pakistan and Iran. He said that Pakistan and Iran needed to have highest level of bilateral business if both the nations want to face the fast emerging global challenges. It is high time that Pakistani business community should join hands with their Iranian counterparts, as this would help both the countries get a respectable place in the global market, which is highly competitive at the moment, he added.

http://brecorder.com/index.php?id=517185&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

50 percent clean cotton target achieved

KARACHI (January 14 2007): Pakistan has achieved 50 percent target of clean cotton bales, according to Pakistan Cotton Standards Institute (PCSI) report on Saturday. To produce contamination-free cotton, a special clean cotton program, launched by the Ministry of Textile Industry in the collaboration with Pakistan Cotton Ginners Association (PCGA).

All Pakistan Textile Manufacturers Association (Aptma), and Punjab and Sindh governments, is in progress during current season (2006-07). According to PCSI report, the Institute has selected 23 ginning factories - 17 from Punjab and 6 from Sindh - for the current season for producing clean cotton, and by January 13, 2007 some 0.7558 million maunds phutti had arrived in these factories.

A team of professionals, headed by PCSI officer with representatives of Trading Corporation of Pakistan, provincial agriculture departments and ginners' representatives are inspecting the 23 selected ginning factories in Sindh and Punjab to ensure clean cotton, the report added.

Out of 0.7558 million maunds seed-cotton received, some 50,800 bales of clean lint cotton have been produced, the report said. Ginnirs have sold some 39,400 bales to exporters and spinning or textile mills at an average premium of more than Rs 35 per maund, said PCSI report. It said that the government is also being paid Rs 50 per maund for cotton growers and suppliers of clean and grade 2 seed-cotton (phutti) to the ginners. According to the report, the current year's target of 0.1 million clean bales of cotton would be achieved easily.

http://brecorder.com/index.php?id=517090&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

Crisis hits textile industry

KARACHI (January 15 2007): A crisis like situation appears to have hit the textile industry, one of the major industries of the country, which contributes 11percnt to the Gross Domestic Product (GDP), in addition to providing 40 percent of the workforce in the manufacturing sector.

It not only has biggest share in the country's industrial sector but also has a major share of 62 percent in the total exports, textile exports stood at 8.92 billion during the last fiscal year 2005-06.

Textile sector contributes 46 percent in the country's total production, while its employment provision ratio is around 35 percent of total labour working in the country.

The high cost of doing business has brought about decline in country's textile export by 1.12 percent during the first five months of current fiscal year 2007 as compared to the same period of the last fiscal year.

According to the statistics available here Pakistan's textile exports stood at $4.192 billion during the first five months July-November period of the current fiscal year as compared to $4.239 billion during the same period of the last fiscal year 2005-06, showing a decrease of $47.54 million in five months.

All Pakistan Textile Mills Association (APTMA) claimed that during the first five months of the current fiscal year textile exports have declined by 3.333 percent.

In July declined by 8.20 percent, in August 6.50 percent, 15.95 percent in September and 5.11 percent in October. However, statistics shows an increase of textile export by 27.68 percent in November 2006, which was the first month of the current fiscal year only in which the export graph moved up.

Investment ratio in the textile sector is higher than any other sector in the country, it stood at $50 billion dollar. During the last five years only $5 billion investment has been recorded.

Pakistan's share in the current trade volume is around 3 percent of the world's total textile trade. Country's textile exports alone are potentially targeted to reach $24 billion at the end of 2014.

New investment in the country is gradually declining due to post-quota regime in the international market with much high competition.

All the textile sectors exports including yarn, readymade garments, bed-wear, towel, knitwear, hosiery and other sectors indicates decline during the current fiscal year.

Industrialist said that the major hurdles in the Pakistan's textile export, are the high cost of doing business, unskilled manpower, new financing and deteriorated law and order situation, in addition to post quota regime.

However, after three months later, government announced five-percent research and development fund on the export of textile on the demand of exporters.

The State Bank of Pakistan (SBP), with the aim of relieving some of the difficulties faced by the textile sector due to increasing competition from the neighbouring countries and the rising manufacturing and business costs, offered a debt swap option under the 'Long Term Financing for Export Oriented Projects (LTF-EOP)'scheme for exporters.

The option provided an opportunity to the textile sector (excluding spinning sector but including its six sub sectors) to swap their long term loans taken from commercial banks and DFIs for import of machinery for their units under LTF-EOP Scheme, which offers mark up rates fixed for the tenor of the loan, approximately 5-6% below market rates, SBP said.

Figures shows that under LTF-EOP scheme SBP has allowed amount of Rs 34 billion as refinance to commercial banks/DFIs as debt-swap option to textile industry under LTF-EOP Scheme up to 31st December, 2006 against the target of Rs 30 billion.

According to the SBP that Textile exporters have the flexibility to seek additional new loans under LTF-EOP as banks by and large are currently within the refinance limits set by SBP for 2006-2007.

Despite these incentives exporters are still not satisfy and they demand more relief to boost up the textile export.

"These incentives are very helpful for the textile industry, however we are still not able to compete the international and our regional competitors in the wake of high cost of production," said Shafqat Elahi chairman and Iqbal Ibrahim zonal chairman of APTMA.

They said that our in put cost have been increased by more than 60 percent, interest rates have been increased by 143 percent during the last two years when central bank increased the interest rates to control the inflation, which make negative impact in the browning of the credit by textile sector.

Furnace oil prices increased by 77 percent, gas tariff 53 percent, goods freight 67 percent, cotton 82 percent and wages by 33 percent during the last three years, they said.

Cost of production is the chief hurdle, which is much higher than India, China and Bangladesh, they added.

Bangladesh encouraged local production of yarn and fabric by giving garment mills at 5% subsidy on local procurement of yarn. They have now attained a capacity of over 5 million spindles despite the fact that there is no indigenous cotton and no man-made fibre production, they added.

The emergence of China as a burgeoning force in world textiles is also a cause for concern in a number of textile sub-sectors, they said.

They said that our Textile Industry has made an investment of $5 billion for expanding its production capacity during the last five years while the interest rates were as low as 3% to 4%. However, now more than 200% increase in the credit cost, which consequently increased the financial charges of the mills, has now forced the industry to stop further investment.

They said there has been reduction of 6.4 percent in investment in textile machinery in the year as compared to the corresponding period last year.

Iqbal Ibrahim said that 11 percent inflation rate is also a contributing factor, which drop in fresh investment in textile, while slow down in further investment in the textile industry due to high cost of capital borrowing and increased pressure from regional competition.

He said that Pakistan is one of the leading textile manufacturers in the world. However, our value-added sectors, particularly apparel and knitted clothing have a very small share in the world trade. These sectors are also suffering from the intense competition from China, India and Bangladesh.

He said that since the abolition of quotas in post 2005 scenario, the textile industry has is up against the adverse situation on account of rapid changes on the national and international fronts, where per unit prices of all textile products is declining,

Post quota Pakistan textile products started confronting market competition on account of unfair trading practices of competitors, besides a negative perception of the country of buyers and investors, he added.

Shafqat Elahi said that in order to compensate textile industry the government announced a relief package for the value-added textile sector but left spinning and weaving sectors in spite of being capital intensive, on their own to face harsh realities.

Since last two years economic parameters have badly affected the viability of the industry and retarded its growth and sustainability, while the investment made by the spinning and weaving industry thus is under serious threat, he said.

He said that the strident rise in various cost push factors has an estimated financial impact to the tune of Rs 80 million for a spinning unit of the size of 20,000 spindles and weaving unit having 120 looms to the tune of 65 million.

"We are the largest investors of this nation. We request to the high authorities now to immediately convene local textile investors meeting under president or Prime Minister command. Together we can formulate a strategy to implement your vision for a dynamic, vibrant and prosperous Pakistan," he concluded.


http://brecorder.com/index.php?id=517371&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

$400 million ADB loan for infrastructure projects

ISLAMABAD (January 15 2007): The Asian Development Bank (ADB) has approved $400 million loan to Pakistan for 'Private Participation in Infrastructure and Program-I (PPIP)' aimed at enhancing economic growth through improved infrastructure services.

Its outcome will enhance private sector participation in the country's infrastructure investment and maintenance to reduce the government's fiscal burden and provide better infrastructure services to the population and enterprises, official sources told Business Recorder.

To achieve the desired objectives, subprograms will also be executed, including strengthening the enabling environment for PPI by addressing the remaining policy, legal, regulatory, and institutional constraints and providing technical and financial support for PPI projects.

This is a cluster program that will consist of Subprogram-I and Subprogram-II (the design of which will depend on the outcome of Subprogram-I and the government's emerging priorities).

A technical assistant grant will support implementation of Subprogram- I and capacity-building initiatives required to support the government's PPI initiatives over the medium- and long-term.

By promoting PPI, the operation will help the government to leverage more financial resources into infrastructure by using the private sector as an intermediary. This will help to fill the gap between (i) the infrastructure the government can afford, and (ii) the infrastructure needed for economic development and poverty reduction, as articulated under the government's Medium Term Development Framework (MTDF).

Infrastructure development is a key pillar of the government's MTDF in recognition of its importance for sustaining economic growth and alleviating poverty. The MTDF acknowledges the necessity of PPI in infrastructure and utilities from the point of view of capital mobilisation, but also in terms of ensuring efficiency and effectiveness.

The government is committed to promote PPI by addressing remaining political, legal, regulatory, and institutional constraints to PPI in priority sectors. Further, under the MTDF, the government has approved specific development programs for the power, transport, and water sectors.


http://brecorder.com/index.php?id=517381&currPageNo=1&query=&search=&term=&supDate=

 

[Neo]

'ADB extending $900 million for mass transit scheme'

KARACHI (January 15 2007): The Asian Development Bank (ADB) is extending financial assistance to the tune of $900 million in the shape of grants for the mass transit programme in the metropolis and the city's water and sewerage projects.

This was stated by Karachi Naib Nazim Nasreen Jalil. She was speaking in the 'Bilmushafa' programme of Radio Pakistan, Karachi, on Sunday. She said that the ADB assistance would be utilised for the mass transit programme in the metropolis, the rail system, roads, overhead bridges, underpasses and for improvement of water supply and sewerage.

The Naib Nazim said that Karachi had been neglected in the past. However, she added that attention was paid to this metropolis when President Pervez Musharraf came to power.

She said that a package of $29 billion was prepared under Tameer-i-Karachi programme and the stakeholders were asked to invest in it.

She pointed out that now development programmes are being carried out in Karachi. Nasreen said that both federal and provincial governments want that Karachi should make progress.

She said that Karachi earns almost 68 percent of the revenue of the country, which speaks of its significance. She highlighted the strategic location and importance of Karachi and said that in its development lay the development of the province and the country.

She said that from the K-3 water scheme of 100 MGD, arrangements were being made to provide 6 MGD to Lyari, and 3 MGD to DHA. Steps are also being taken for supply of water to Baldia Town from this scheme, she added.

The Naib Nazim said that Rs 50 million each have been given to the towns for laying sewerage lines and strengthening the water supply lines.

She said that a lot of attention was being paid towards education, and 38 schools would be upgraded as model schools and they would be of the standard of private schools.

She said Nazim Mustafa Kamal "is doing a lot" for the progress and development of the city. She said that concerted efforts should be made by all so that this city could make a rapid headway.

She also spoke about `Hamara Karachi' programme which is being celebrated to mark the platinum jubilee of the Karachi Metropolitan building.

Nasreen said that a number of programmes were being organised for every segment of the society to foster understanding and brotherhood among various communities who dwell in this metropolis and to develop a sense of belonging for the city.

She also pointed out that there are more than 200 historic buildings and "we want to provide information to the people about this city".

http://www.brecorder.com/index.php?id=517410&currPageNo=1&query=&search=&term=&supDate=

 

[Neo]

Implementation pact signed for 225MW Sahiwal power plant

ISLAMABAD (January 14 2007): Saif Power Ltd (SPL) has signed 'Implementation Agreement' (IA) with the Private Power and Infrastructure Board (PPIB) to set up 225 mw power generation facility in Sahiwal. The IA document was signed and exchanged between Khalid Irfan Rahman, Managing Director PPIB, and Javed Saifullah Khan, Chairman of the company.

The company had also signed Power Purchase Agreement (PPA) with National Transmission and Dispatch Company (NTDC) a few days ago, while Gas Supply Agreement (GSA) has also already been initialled with Sui Northern Gas Company Limited (SNGPL).

The signing of IA has concluded the package of agreements (IA, PPA and GSA), as per requirements of the 2002 power policy. Now, the company will proceed with its financial closure and, thereafter, the construction of the power complex.

The power plant, which is expected to start its commercial operations early in 2009, would be established at a cost of $189 million. The power plant is based on combined cycle/gas turbine technology, and would be capable of operating on dual fuel. It will use gas as primary fuel.

http://www.brecorder.com/index.php?id=517135&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

Pakistan seeks extradition treaty with Australia


ISLAMABAD (updated on: January 15, 2007, 22:53 PST): Prime Minister Shaukat Aziz on Monday said Pakistan values its multifaceted relations with Australia and is keen to further consolidate co-operation in broad spectrum of areas particularly trade, investment, education, agriculture, agribusiness and livestock.

Talking to Philip Ruddock, Attorney General of Australia who called on him at the PM's House this evening, he said the relations between Pakistan and Australia have strengthened as a result of the growing bilateral interaction between the top leadership of the two countries.

Shaukat Aziz said Pakistan is keen to sign extradition treaty with Australia.

He said Pakistan is also positively considering the Australian proposal to sign agreement on mutual legal assistance in criminal matters.

The prime minister said that Pakistan is against terrorism in all its forms and fighting against it out of conviction, in its own national interest and for maintaining peace and stability across the world.

Shaukat Aziz emphasised the need to address the root causes of terrorism to eradicate this scourge adding that terrorism stems from a feeling of deprivation, injustice, lack of opportunities and lack of dispute resolution.

He said Pakistan is assisting Afghanistan in its reconstruction process because a strong stable and vibrant Afghanistan is in the best interest of its people, Pakistan, region and the world.

The prime minister said Pakistan has taken a number of steps to regulate the movement of people at the Pak-Afghan border, which is long and porous.

Pakistan has deployed 80,000 troops to improve security situation in the tribal areas and now weighing various options including fencing and mining of its side of the border with Afghanistan to prevent the movement of extremist elements.

He said the international community needs to expedite the process of reconstruction in Afghanistan and more economic opportunities should be created for the people of Afghanistan to discourage extremism and terrorism. This will encourage the Afghan refugees living in Pakistan to return to their homeland, the prime minister added.

Giving an overview of the economic turnaround achieved by Pakistan, the prime minister said, as a result of the broad based reforms introduced by the government during the last seven years in every facet of life, the economic and social landscape of the country has significantly improved.

The prime minister said per capita income and the size of economy have doubled, poverty has come down from 34-46 percent in 2001 to 24 percent in 2006 and all social indicators are moving up.

He thanked the Australian government for the 500 scholarships for Masters and Ph. D level students and 6.6 million dollar agricultural support programme initiated by Australia for Pakistan.

Philip Ruddock said Australia attaches importance to its relationship with Pakistan and desires to further strengthen co-operation between the two countries.

He said Australia wants to sign extraction treaty and agreement for mutual legal assistance with Pakistan is being worked out with Pakistani authorities.

brecorder.com

 

[Neo]

Labour-intensive industries lack investment
By Mansoor Ahmad

LAHORE: Pakistan has generated $6 billion in foreign investment through privatisation in the last seven years, but it is still on the look-out for investors that can enter labour-intensive industrial sectors.

Foreign investment in the country is not coming in the manner that generates productivity. The country received $6 billion investment in the last seven years including $3.5 billion foreign direct investment in the previous fiscal (2005-06). However, 10 per cent of the investment came from the privatisation of commercial banks and 36 per cent was received as proceeds of the PTCL and OGDCL sell-off. Thus, 46 per cent or almost half of the total foreign investment went to the already operational companies. The remaining 54 per cent FDI was invested in new projects that too mostly in the services sector. Very few green industrial and job-intensive projects were set up with this foreign investment.

Foreign direct investment, according to the UNCTAD, amounted to $1.2 trillion across the world in 2006 with Asia accounting for investment inflows of $183 billion. China, Hong Kong and Singapore were the top three recipients of the FDI. Pakistan’s share in foreign investment inflows during the year was around two per cent of the total FDI received in Asia and 0.2 per cent of global FDI.

Economic experts believe Pakistan is still not an attractive place for foreign investors and the recent surge in foreign investment is more the result of personal efforts of the President and Prime Minister and privatisation of national assets.

The investment policy, experts say, looks excellent on paper but its implementation is a serious problem. Pakistan’s ratings on governance, regulation, competitiveness and political freedom are too low to attract any meaningful investment, they say.

Every time the President and the Prime Minister visit foreign countries they lure the investors there. A few that show interest then visit Pakistan and things move fast in these particularly special cases. However, for those investors that choose to come through normal channels, hurdles still exist. The investors rethink their investment plan after experiencing bureaucratic snags, corruption and incompetence.

Pakistan stands at 142nd place in the latest Corruption Perception Index of Transparency International with transparency points of 2.2 out of 10. India and China, our main competitors in the global trade, are ranked 70 with transparency score of 3.3 per cent.

In the Business Competitive Index released by the Geneva-based World Economic Forum, Pakistan is ranked 91st out of 125 countries. India is at number 43 and China at 54. The same forum placed Pakistan at 67th place in the Network Readiness Index while India and China at 40 and 50.

ST Kearney, a US-based research institute in its FDI Confidence Index for 2006, ranked China first and India second as the most favourite destinations for foreign investment. Pakistan is not even among the first 50 most lucrative global countries for foreign direct investment.

Global Integrity, another western NGO, assessed countries on the basis of freedom to civil society, media, government accountability, corruption and rule of law, oversight regulation and election process. In its Global Integrity Ratings for 2006, India is among states with moderate rating and Pakistan among countries with weak rating.

Freedom House of US classifies countries on the basis of freedom of speech, vote, business corruption and judiciary. It has classified Pakistan as the country that is not free. Again Afghanistan is classified as partially-free country along with Bangladesh and Sri Lanka. India is classified as totally-free country.

Investment consultants say the global investors go through the analyses of the above international institutions before investing in any country. Unfortunately, Pakistan is not rated favourable. The country would have to improve its governance and regulatory institutions to qualify as one of the favourite destinations for investment. They point out that geographically Pakistan is ideally located as a gateway to the vast and virgin market of Central Asia, besides bordering China.

http://www.thenews.com.pk/arc_news.asp?id=3

 

[Neo]

Minfal hopeful of exceeding revised cotton target

ISLAMABAD (January 16 2007): The Ministry of Food, Agriculture and Livestock (Minfal) is hopeful of exceeding revised cotton target of 12.5 million bales, as it is expecting production of 13 million bales at the end of season.

"We will exceed the revised target of 12.5 million bales by achieving 13 million bales against the fixed target of 13.82 million", official sources told Business Recorder on Monday.

The Minfal would have achieved record production of 16 million bales had the pest and viral attacks not damaged the current crop, the official claimed.

Both pest (Mealy bug) and viral (CLCV) attacks caused a loss of 1.5 million bales each limiting the size of crop nearly to hover around 13 million bales, he added.

The cottonseed arrival in ginning factories of Punjab and Sindh has been reported as 11.082 million bales against last year's arrival of 11.246 million bales in PCGA, during the last fortnight.

The Minfal had also chalked out a short-term strategy to control mealy bug causing 12 percent loss to cotton production during this season for which Rs 29 million had been allocated, Cotton Commissioner Dr Masood Amjad Rana said.

According to conservative estimates, the epidemic (mealy bug) caused Rs 4 billion losses, damaging the crop in the cotton growing areas, which equalled CLCV damages, Dr Rana added.

Under the plan, the ministry would control this pest, first appearing last year in Vehari, Punjab through biological control by strengthening the institutions, as they have no set up to control this, he said. The Ministry would organise an international workshop in Islamabad in August for this purpose. The government would also make efforts to increase production of friendly pest and later distributing it among farmers, he said.

About the CLCV control, Cotton commissioner said that the Minfal along with its attached departments like Central Cotton Research Institute (CCRI) was introducing viral resistance varieties.

Besides conventional varieties, the ministry was also working on fast track to introduce Bt cotton varieties in the market as well, he added.

http://www.brecorder.com/index.php?id=517563&currPageNo=2&query=&search=&term=&supDate=