Pakistan Economy - News & Updates - Archive

[Neo]

Mega project for skill development to be launched: Cheema

RAWALPINDI (January 25 2007): The Punjab government has planned to launch a mega project for skill development in non-industrial areas within a month besides encouraging cottage industries in the rural and suburban areas of the province, said Provincial Minister for Commerce and Industries Suhail Zaffar Cheema here on Wednesday.

"This project would help create over 70,000 jobs in every district, besides setting up 7,000 small industrial units and improving the living standards of the people in these areas."

The minister said this while talking to senior executives and members of the Rawalpindi Chamber of Commerce and Industry (RCCI) during his visit to chamber. RCCI president Hasan Sarosh Akram and senior executives welcomed the minister and apprised him about the problems of the business community in Rawalpindi.

The minister said the Punjab government has decided to constitute a think tank to gear up efforts for industrialisation in the province. People from every region of the province would be included in the think tank to make a policy suitable to the industrial sector.

Suhail stressed the need for making dedicated efforts for human resource development. Once growing population was a problem for China while after human resource development this population became strength for the country and took it to new heights of industrial development, he said.

He said his ministry was a facilitator for the industrial and commerce sector and provides all possible facilities to the business community. We will hold exhibitions round the world to introduce our industrial products. We will help industrial community to explore new markets for their products, he added.

He assured the business leaders of Rawalpindi that he would resolve all their problems. He said the matters of Rawat Industrial Estate, Chamber plots and commercialisation of chamber building would be discussed with Chief Minister.

Earlier, in his welcome address, Chamber president Sarosh Akram said chamber was acting as a bridge between business community and government. He said chamber used all its efforts for industrialisation in the region so that it has launched first ever private sector industrial estate in Rawalpindi.

He informed the minister about the problems of Rawalpindi chamber saying that chamber is facing problems in commercialisation of its building. Industries Department demands a fee of Rs 4 million and matter was raised with Chief Minister who assured to provide Rs 5 million grant but the department has raised the fees to Rs 7 million.

He sought help of the minister in provision of gas to Rawat industrial estate saying the Prime Minister had announced provision of gas but no progress was made so far.

http://www.brecorder.com/index.php?id=521356&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

UAE's Mashreqbank eyes expansion in Pakistan or India


DAVOS (updated on: January 25, 2007, 09:31 PST): Mashreqbank, the United Arab Emirates' fifth-biggest lender by market value, could spend up to $1 billion to buy a local bank in India or Pakistan to expand its business, its chief executive officer said on Wednesday.

Mashreqbank already has two branches in India and a representative office in Pakistan.

"But we think India is a huge continent you can't work with two branches. We are looking at a local acquisition or a joint venture because I think we can bring our Middle Eastern connection and our technology," Abdul-Aziz Abdulla Al-Ghurair told Reuters on the sidelines of the World Economic Forum.

"I'm looking for the market cap of $100 million to $1 billion," said Ghurair, among the richest men in the world who is believed to be worth about $2 billion.

He added that the bank's target areas of expansion start in the neighbouring Gulf Arab region, then the wider Arab world, followed by the two South Asian countries.

"We will not like to go beyond this ... We need to concentrate. The world is too big. We want to spread our network in the region, rather than having a scattered strategy here and there," Ghurair said in the Swiss ski resort where more than 2,400 business and political leaders are gathering.
DIVERSIFICATION

Ghurair said the bank was hardly hit by the 2006 Gulf stock market crash, which wiped capitalisation of the region's markets by $500 billion at one point, as its investment in equities accounts for only 2 percent of the total portfolio.

"Markets have come to their senses. It was overheated," he said, adding, "Looking at multiples they look reasonable. Companies are doing well, compared with three years ago when they are making less and the multiples were higher. We have learned the lesson."

Gulf markets have an estimated total capitalisation of $850 billion, about 15 percent of the value of all emerging markets.

Ghurair said Mashreqbank allocates around 80 percent of its total investment portfolio to bonds. Eighty percent of the entire portfolio is invested in US dollar-based assets, such as US Treasuries.

"We use investment as a surplus liquidity. We use it as a liquidity cushion. We are looking for a big return. We are targeting around 1.5-2 percent," Ghurair said.

Six countries of the Gulf, including the United Arab Emirates, have worked towards introducing a single currency by 2010.

But cracks are appearing with Oman recently saying it would not abide by the deadline by the Gulf Co-operation Council and Saudi Arabia saying the group might need to review the date.

Ghurair said business can afford a couple of years of delay.

"2010 or 2012, it doesn't matter as long as there's direction they've agreed to move towards. The delay won't be long because there is a political decision to move forward," he said. "Once you get in, there is no way out. Let them be comfortable and let them be clear on what they are doing. Let them take two moreyears."

There have been also some talks the GCC might ditch a dollar peg for the new currency.

Ghurair was in favour of the peg.

"It's a peace of mind. We don't have to worry about currency fluctuations," he said.

brecorder.com

 

[Neo]

Textile exports fetch $5.3bn in 6 months

KARACHI, Jan 24: Textile products are gradually catching up with their half-yearly proportionate export targets fetching a total amount of $5.34 billion in July-December 2006 as against a projection of $5.53 billion, the other products -— leather, sports goods, surgical instruments, petroleum products, molasses, fish, fruits and vegetables, chemicals, gems and jewellery appear to be quite off the mark indicating that these will not be able to earn projected $7 billion at end June next.

As the trend appears, the analysts believe that textiles in the current fiscal year may end up showing more than 65 per cent of total exports, while all other products and commodities will generate about 35 per cent of export earnings. This will make Pakistan’s export structure further narrow-based and more vulnerable to pressures of foreign buyers.

A delayed pick-up of textile exports has given all hints of this trend gaining further momentum in remaining period of 2006-07. It has also given the government all reasons to take credit of attributing it to the incentive package of about Rs25--30 billion given to textile sector.

The textile business has been given 6 per cent cash rebate on export of garments, 5 per cent rebate on home textiles and 3 per cent on fabrics, a generous swap of high-interest bearing loans with concession rated loans given to export-oriented units and reduction in export refinance.

“A textile exporter is now getting Rs65 to Rs66 on his one dollar export earning because of all these concessions and incentives,” an analyst estimated. But textile exporters want Rs70 plus for every dollar they earn.

Officials are now of the view that textile does not need any more concession but there is a convincing case of incentives and concessions for other sectors to diversify exports. There is already a lot of heart burning among the exporters of leather, sports goods, surgical instruments, cutlery, engineering goods on textile exporters being pampered and given all concessions at their cost.

An official analysis of the official export statistics, already declared controversial and unreliable by the State Bank of Pakistan in its recent quarterly report, shows that yarn has exceeded its proportionate export target of $724 million in six months and fetched $742 million.

Officials projected a total export earning of $11.5 billion from cotton and textile products in the current fiscal year after having shown actual exports of more than $10 billion in the year 2005-06. Cotton export was projected to earn $70 million, which now is being ruled out because its crop production has remained below than 13.8 million bales. Cotton crop expectations are now around 12 million bales.

Yarn export is expected to earn $1.65 billion against which $741 million have already been realised and exporters are confident of netting in about $1 billion more in the remaining period of the current fiscal year.

Officials fixed an export target of $2.48 billion for fabrics against which $963 million have been earned in first half 2006-07. Garment is projected to realise $3.41 billion against which 1.72 billion has already been netted. Textile made ups are likely to earn $2.77 billion against which actual earnings in July to December 2006 is $1.16 billion.

Rice has shown better performance and has netted $529 million in first half as against $1.27 billion for the whole year. But export of leather products are far behind their target of $1.12 billion as these could earn only $429 million in first half of the current fiscal year.

Sport goods export fetched only $124 million against a target of $350 million, carpets $114 million against $280 million, surgical instruments $55 million as against a target of $180 million, petroleum products $354 million against $840 million, fish $95 million against $210 million, fruits and vegetables $58 million against $150 million, engineering goods $97 million against $235 million, and gems and jewellery only $9 million against $35 million.

The government fixed a total export target of $18.6 billion for the current fiscal year against which actual exports in first half is $8.81 billion that indicates 96 per cent performance. Actual export performance in previous years show that exports exceed the 100 per cent projection of later half period—-January to June—-because of the availability of textile products and a few other items

Imports were originally projected at $30 billion when oil price was high at $68 a barrel. Now that oil prices are down to $51 a barrel, the government still waits for a further drop before hedging it at a level for the remaining period of the year.

http://www.dawn.com/2007/01/25/ebr2.htm

 

[Neo]

January 25, 2007

Marble exports to touch $500 millin in five years

ISLAMABAD, Jan 24: Minister for Industries, Production and Special Initiatives Jahangir Khan Tareen said on Wednesday that the government planned to enhance the export of marble and granite to $500 million in the next five years.

He stated this after inaugurating the newly established office of Pakistan Stone Development Company (Pasdec) here at Islamabad Chamber of Commerce and Industry building.

Secretary Industries Shahab Khawaja, Chairman Pasdec Ehsanullah Khan and Ms Amy Meyers, director of economic growth office of USAID and members of the business community were also present on the occasion.

He said that government was taking special steps for the promotion of stone industry and an amount of Rs2 billion had been allocated for development of industrial parks for stone mining and marble and granite cities. Another Rs2 billion would be spent on the development of infrastructure in the sector.

He appreciated USAID for its assistance in the development of this sector.

The minister said that Pakistan was rich in marble and granite resources and these were available in remotest areas of the NWFP, Fata, rural Sindh and Balochistan.

He added that the government was striving hard to explore these resources for the benefit of the people living in these areas by creating employment opportunities.

This, he said, would not only help ameliorate the lots of the common man in these remote areas of the country but would also enhance export of marble and granite for the economic development of the country.

Tareen asked the business community to come forward and take maximum advantage from government's initiatives being made for the development of the stone sector.

He regretted that in the past marble and granite sector was not truly exploited adding that the present government is focusing on the development of this sector.

He said that by introducing latest technology in marble and granite mining, “we can get rid of the traditional mining method of blasting and could save these precious stones from going waste and causing financial losses,” he added. Wastage in mining of stones in the country is the highest in the world, he added.

He expressed the hope that the strategy being devised by Pasdec would help promote the sector and prevent the wastages.

Ms Amy Meyers of USAID in her remarks appreciated the efforts of the government for the development of stone mining sector in the country.

She stressed the need for public-private sector partnership for the development of the sector.

Chairman Pasdec Ehsanullah Khan said that during the first five months of current financial year the exports of marble and granite to USA has increased to 100 per cent.

Later an MoU was signed between National Industrial Parks Development Authority and Pasdec.

http://www.dawn.com/2007/01/25/ebr17.htm

 

[Owais]

IPI project gas supply likely from 2015

KARACHI: The provision of gas from Iran, Pakistan and India (IPI) gas pipeline project is likely from 2014-15.

Talking to Geo News, Munawar Baseer Ahmed, Managing Director of Sui Southern Gas Company (SSGC) said on Wednesday that after the resolution of gas price row, contract, design and other essential work would take one to two years; subsequently, the pipeline would be laid.

Briefing on the developments in project of LPG import, he said that its tender would be approved in the session of cabinet’s committee for economic coordination being held on February 1st 2007.

In first phase, 500 million cubic feet of LPG would be imported, Munawar Baseer said adding that two years after this, another tender would be given for the import of 500 million cubic feet LPG.

http://geo.tv/geonews/details.asp?id=1210&param=3

 

[Owais]

146.1 bln sales tax collected in first half of current FY

ISLAMABAD: Secretary Sales Tax & Federal Excise Wajid Ali, has said that the total sales tax collection in first half of the current financial year (July-December) was Rs. 146.1 billion as compared to Rs. 132.6 billion in the corresponding period of last year indicating a growth of 10.2%.

He was addressing the Conference of Collectors of Sales Tax and Collectors (Appeals) in Islamabad.

In his presentation on the overall performance of sales tax & federal excise collectorates, he informed that some of the revenue spinners have shown a remarkable growth which include POL products (15.5%), telecom (44%), sugar (35%), LPG (22%), Electricity (77%), services (12%), cigarettes (33%) etc.

Similarly, total federal excise collection in first six months was Rs. 5.9 bn as compared to Rs. 4.3 bn in the corresponding period of last financial year showing a growth of 36%.

Growth in major federal excise earning items was, cigarettes (18%), cement (22%), POL products (34%), Beverages (37%) and Cosmetics (40%) he added.

http://geo.tv/geonews/details.asp?id=1182&param=3

 

[Neo]

Thursday, January 25, 2007

Pakistani industry should not depend on China: Jica

* Japan International Cooperation Agency says Pakistanis may not survive even in domestic market by doing this

By Fida Hussain

ISLAMABAD: The Pakistani manufacturers would not be able to survive even in the domestic market if they continued to imitate the Chinese strategy and to import components from China, said a study conducted by the Japan International Cooperation Agency (JICA).

JICA has conducted the study after it was asked by the government to prepare a strategy for the manufacturing sector in Pakistan. JICA is of the view that when trade with China expands in the process of globalization, it is unavoidable that Pakistani products will face severe competition with Chinese products in the domestic market.

Though the quality of these Chinese products is not fully satisfactory, the local demand is likely to increase, the study says. In fact, some Pakistani manufacturers have already started making cheap and low quality goods by imitating the Chinese. “We do not think that this is an appropriate strategy for the Pakistani industry,” the JICA study says.

The study was discussed with, and submitted to, the government at the business dialogue that concluded here on Tuesday. If cheap, low quality, and counterfeit products are easily available in the market, it is very difficult to promote high-value, high-tech and internationally competitive manufacturing in the domestic industry.

Pakistanis had better introduced a strategy focusing on manufacturing high-value and highly quality products and made its own brands recognized in the market, the study informs. According to the study, Pakistani manufacturers must avoid direct competition with Chinese industry and promote an integral type of manufacturing. The integral type production, which promotes assembly-type manufacturing such as motobikes, automobiles and electronics. Under this type, product quality heavily depends on intimating coordination of each production process, or component designing. The relationship between functions and components of the integral manufacturing is highly intricate. Each component affects each other and determines the quality of final products. Automobile is a typical example, the study says.

The other option available is modular-type manufacturing. The important characteristic of this type of products is that the relationship between the function and the component is simple and close to one to one, the study says.

Japan has advantage in integral manufacturing, so their automobiles and motorbikes are much competitive internationally. The US has advantage in module manufacturing. China is relatively good at modular-type manufacturing and Chinese manufacturers are producing labour-intensive products by mobilizing cheap labour force.

Integral manufacturing seems to be suitable for Pakistan. Moreover, East Asian countries such as Thailand and Malaysia carefully avoided direct competition with China and achieved rapid industrial growth, by introducing the integral-type manufacturing of Japanese manufacturers, the study says.

According to the study, one possibility is that the Pakistani industry would decide whether to become a subcontractor of the Chinese industry by introducing the same modular-type manufacturing or to promote the integral-type manufacturing to avoid direct competition with the Chinese industry.

Commerce Minister Humayun Akhtar Khan had asked Japan on Tuesday to sign a free trade agreement (FTA) with Pakistan. He had expressed the opinion that following the implementation of FTA with China, most machinery and raw material from China would now be imported duty free, but the same would attract normal duty on imports from China.

http://www.dailytimes.com.pk/default.asp?page=2007\01\25\story_25-1-2007_pg5_2

 

[Neo]

Thursday, January 25, 2007

India, Pakistani agree on ‘affordable’ gas

ISLAMABAD: India on Wednesday endorsed the Pakistani view on gas prices at the fourth meeting of the working group on Iran-Pakistan-India (IPI) gas pipeline. It said the buyers should get the gas on “affordable prices”.

The three countries began discussions after a gas pricing report presented by consultant Gaffiney Cline. Dr Ghanimi Fard, special representative of the Iranian minister for petroleum, said that Iran had the largest gas reserves in the region and was looking forward to meet the energy requirements of Pakistan and India through the IPI pipeline. He hoped that the working group meeting would finalise the gas pricing mechanism. Ahmad Waqar, the Pakistani petroleum and natural resources secretary, said Pakistan was keen to implement the project as quickly as possible. According to a message from Tehran, the talks will continue on Thursday.

NNI adds: Managing Director of Iran’s National Gas Exports Company Nasrollah Seifi has said that Tehran was not amenable to the proposed price. “If New Delhi is to bring Iran’s gas into India, it (New Delhi) should pay the cost of the transfer via Pakistan,” he said. Iran has proposed a “floating price,” which it says is necessary because of the volatility of crude oil prices, said the official.

Asked if the meeting was held under external pressure, the official said that India and Pakistan have “strongly responded to external pressure and have not been influenced by such pressure”.

Seifi said that comments by India and Pakistan on the issue indicate they take into account only their own interests. He said that although India and Pakistan differ widely in their economic situations, they act as a “single client” when it comes to the purchase of Iranian gas, Seifi stressed. Asked if sanctions sought to be imposed on Iran would have a negative effect on the project, the official said, “No instance of a negative effect has been observed so far.” Seifi was optimistic that of the parties failed to reach an agreement in the current meeting, oil ministers of the three countries would agree on another meeting. The official said that Iran has the capacity to export some 90 million cubic meters of gas to India and 60 million cubic meters to Pakistan on a daily basis once the pipeline became operational.

Stressing that transfer of gas to India and Pakistan by land would be the best option for the two countries, Seifi said that the pipeline, dubbed the `Peace Pipeline’, would traverse 1,100 kilometres of Iranian territory, 1,000 kilometres of Pakistani territory and 500 kilometres of Indian territory.

http://www.dailytimes.com.pk/default.asp?page=2007\01\25\story_25-1-2007_pg7_17

 

[Neo]

TenXc to open development centre in Pakistan
By Krystle Chow, Ottawa Business Journal
Thu, Jan 25, 2007

Wireless systems developer TenXc Wireless Inc. is partnering with Pakistani company Coherent Designs Pvt. to establish a joint development centre for wireless products in Pakistan's capital.

Ottawa-based TenXc will be expanding its existing research and development capabilities through the new development centre in Islamabad. The centre will collaborate with TenXc's development team in Canada to design fourth-generation wireless access systems such as mobile WiMAX.

TenXc's vice-president of marketing Ross Ernst said the company chose to build its development centre in Pakistan to allow for around-the-clock development of their products, thus speeding up the process of getting their systems to market.

He added that Pakistan has been one of the leading early adapters of mobile WiMAX technology, while also providing a pool of well-educated and highly skilled engineers to work with.

"We've found a lot of demand for our current and new products in this region," said Mr. Ernst, who added that the global WiMAX market was worth $1.1 billion in 2006 and is expected to grow to $3.3 billion by 2009.

"With a rapidly growing wireless industry and early lead in global mobile WiMAX deployments, Pakistan makes a natural choice as the site of our first external development operation outside North America," said TenXc chief executive Joe Hickey in a statement. "The demand we're experiencing throughout the region for our current Intelligent RF products demonstrates the leading role countries such as Pakistan are playing on the path to mobile broadband."

http://www.ottawabusinessjournal.com/288049054867310.php

 

[Janbaz]

Country needs Rs2.9 trillion to upgrade infrastructure’
By our correspondent

KARACHI: The State Bank of Pakistan (SBP) has estimated that countryís financing needs to upgrade present infrastructures will be Rs2.9 trillion.

Muhammad Arif, Joint Director, Financial Markets Strategy and Conduct Department of the Central Bank, while presenting his paper on Sukuk, at a 2-days international conference at a local hotel on Wednesday detailed following break up.

Ports: Rs104 billion; Aviation: Rs133.9 billion; Energy: Rs1102 billion for private sector and federal government; Karachi Electric Supply Corporation: Rs58 billion; water resources: Rs219 billion.

In fuel sector the public sector will need Rs219 billion and private sector financing needs will be Rs174 billion.

He said the issuance of Sukuks is the best financing option.

He suggested five-point way forward for achieving the financing targets:

Creation of primary sovereign Sukuk Market.

Creation of critical mass in sovereign market to the level of Rs30 billion. This would enable Islamic banks to meet their reserve requirements leaving some mass to secondary market trading.

Creation of Repo market by innovating some model in accordance with Shariah requirements and devising documentation and drafting of master Repo agreement.

Making Islamic financing activities part of Monetary Policy Operations. This can be done through introduction of short-term Islamic Money Market instrument mimicking features of Treasury Bills.

Price dissemination mechanism be installed.

He disclosed that SBP is coordinating with international financial institutions in developing Islamic Money Market and Sukuk Market.

SBP has also formed a task force to develop Islamic Money Market and to suggest Government of Pakistan regarding structuring and issuance of Sovereign Domestic Sukuk.

SBP is also coordinating with SECP to develop corporate bond market by making them cost effective and by providing requisite market infrastructure.

According to him this would facilitate corporate Sukuk Issuance as well.

The News.
http://thenews.jang.com.pk/daily_detail.asp?id=40228

 

[Janbaz]

Citibank likely to acquire Soneri Bank

JAVED MAHMOOD
KARACHI - Citibank is likely to acquire Soneri Bank Limited that would another major merger in the banking sector in the country in case both the banks succeeded in striking a deal, banking sector sources privy to this under-consideration development told The Nation on Wednesday.
These days the high ups of the Citibank were probing the worth of Soneri Bank to find out whether or not the latter bank is feasible for merger with the former bank, said sources.
If both the financial institutions developed initial understanding in coming days, their managements would intimate the Karachi Stock Exchange and State Bank of Pakistan (SBP) about formal discussion of Soneri Bank’s merger with Citibank, sources added.
The experts of the Citibank would also seek a formal permission from the SBP for the due diligence of Soneri Bank.
Soneri Bank is listed at Karachi Stock Exchange. Its share closed at 48 rupees at KSE on Wednesday. Capital market sources said that the foreign banks in Pakistan are rapidly expanding their network in the country by opening new branches and acquiring small and medium banks, especially those, which are financially weak and are unable to meet the SBP’s requirement of enhancing the paid up capital over year.
Recently the Standard Chartered Bank Limited has acquired the Union Bank Limited and merged it into the SCBL as a result the Standard Chartered Bank Pakistan has become the fifth largest bank in the country.
Similarly, ABN Amro bank is also in the process to acquire Prime Commercial Bank and both the financial institutions are close to finalise the deal,said sources.
Meanwhile, NIB Bank of Singapore is also acquiring major stake in the Pakistan Industrial Credit and Investment Corporation (PICIC).
According to capital market sources, this deal is also at an advanced stage and if it materialized, it would greatly expand the scope of operations of the NIB Bank in Pakistan.
Similarly, another impending amalgamation in the financing sector is between KASB Bank and the International Housing Finance Limited. The KASB Bank is shortly acquiring IHFL to enhance its operations and outreach.
Capital market experts said that around one dozen small and medium size local banks were facing merger as they were not in a position to meet the SBP’s legal requirement of increase in their paid up capital limit. Similarly, SBP has directed the foreign and Pakistani banks, operating in the country, to increase the number of their branches to provide financial services to maximum number of people.

The Nation.
http://www.nation.com.pk/daily/jan-2007/25/bnews1.php

 

[Janbaz]

Textile industry to face turmoil in 2008

MONEM FAROOQI
LAHORE - In the absence of proper planning and focus on the emerging world textile scenario, the local textile industry foresees a turbulent and a disastrous era in 2008 when China will fully avail WTO quota free benefits.
Talking to the Nation, the industry leaders expressed the view that lack of interest on the part of government vis-a-vis textile industry including the value-added textile sector, would make the country face a debacle. China at present is growing at a rate of 8% per annum.
“We have only the current year left to set our house in order as there was urgent need to strengthen apparel industry which could face the challenge of 2008 when China fully comes to avail the free market access under WTO quota free regime,”said textile industry leaders.
China and India followed by Bangladesh and Sri Lanka have already penetrated into world market of value-added textiles, whereas Pakistan even today is standing on the sidelines as far as apparel goods are concerned, Chairman Pakistan Readymade Garment Manufacturers And Exporters Association (PRGMEA), Ijaz A. Khokhar said. He further told that despite being the fourth largest cotton producing country, Pakistan had failed to get due benefit from its indigenous raw material.
He said that it was a well known fact that when a country exports raw cotton, it earns around 40 to 50 cents from one pound of cotton but when same was converted into yarn it earns $1 to $1.5 per pound.
However, if further value addition was made and converted the fabric into apparel it fetches $5 to $10 per pound. Countries like China, India and Bangladesh are mostly involved in value addition.
He further said that the country had become a semi-finished raw material source for the nations involved in value addition and apparel production.
It could also be said that Pakistan was serving other nations to earn more foreign exchange on export of value-added products.
Ijaz said that we could not compete other nations without well thought-out plans and focused approach from government and industry. Consequently, the PRGMEA chief said that Pakistan was now the only country, which was weak in apparel and strong on semi-finished raw materials such as yarn and fabric.
APTMA, chairman, Shafqat Ellahi Sheikh feared that up coming times for textile industry might prove a debacle.
The exports were not zero rated as being claimed by the government, Shafqat said adding that the exporters were being charged around 3 pc taxes in 13 different forms including turn over tax, withholding tax,, EOBI, EDS, social security, cotton cess, stamp duty, electricity duty, professional tax, capital value tax (cvt), textile cess WWF and WPPF.
He said that the local textile sector could not come into competition with Inflationary cost pressures, indirect taxes, inefficient ports & inland transport, flawed quota policy militated against value addition, over valued exchange rate and travel advisory.

The Nation.
http://www.nation.com.pk/daily/jan-2007/25/bnews5.php

 

[Owais]

Liquid reserves of Pakistan cross $ 12.9 bln mark

KARACHI: The total liquid foreign reservesof the country crossed 12,952.8 million dollars mark on January 20, 2007, State Bank of Pakistan announced here Thursday.

According to the break up, dollars 10,596.2 million were held by the central bank whereas other banks held dollars 2,356.6 million on the said date


http://geo.tv/geonews/details.asp?id=1262&param=3

 

[Owais]

Pakistani raw cotton buyers diverting to India

KARACHI (January 26 2007): Leading foreign buyers of Pakistani raw cotton are diverting to India and USA due to high contamination ratio. As a result, 23 percent decline has been noted in Pakistan's raw cotton export during the first half (July-December) of the current fiscal year as compared to the corresponding period last year.

Pakistan's raw cotton exporters are facing challenges of quality in the international market as such, Pakistan's raw cotton export is declining, benefiting India and the USA.

According to official statistics, Pakistan's raw cotton export stood at $25.365 million during the first half (July-December) period of the current fiscal year as compared to $33.172 million during the same period last fiscal year. This accounts for a decrease of $807 million. In term of quantity, raw cotton export to different countries has declined by 23 percent.

During the first half of the current fiscal year, Pakistan has exported 23,781 tonnes of raw cotton as compared to 30,892 tonnes during the same period last year, denoting a decline of 7,111 tonnes.

Much before the official statistics were made available, Naseem Usman, a leading trader of the Karachi Cotton Exchange (KCE), told Business Recorder that buyers of Pakistani raw cotton including Malaysia, Indonesia, Vietnam and Bangladesh are now avoiding. The reason he quoted was high contamination ratio, which tilted the Indian and US buyers' decision.

He said that contamination ratio in the Pakistan's raw cotton is higher than the other competing countries, as a result, the Pakistani exporters are loosing buyers. Statistics of raw cotton exports also showing a decreased of 9 percent during December 2006 as compared to the same period last year.

Pakistan exported worth $6.947 million raw cotton during December 2006 as against $7.640 million in the same period last year. In terms of quality, during December 2006, Pakistan exported 6,510 tonnes raw cotton as compared to 7,132 tonnes in the corresponding period of the last fiscal. That accounts for a decline of 622 metric tonnes.

Naseem Usman said that although Pakistan's raw cotton prices are lower than that of US and India in the international market, but exporters are facing challenges of cotton quality, which benefits India and other countries against Pakistan.

Price of the Pakistani cotton is 52 cent per pound while the Indian cotton costs 56 cent per pound and USA at 58 cent per pound in the international market, he said.

He said that although this year government has taken some steps to increase contamination free cotton production up to 0.1 million tonnes, but this is grossly inadequate to meet international demand.


http://brecorder.com/index.php?id=521613&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

Domestic debt swells to Rs 2.406 trillion: SBP
ISLAMABAD (January 26 2007): Pakistan's total outstanding domestic debt has risen to Rs 2.406 trillion recorded at the end of November 2006 from Rs 2.293 trillion at the end of June 2006 showing an increase of Rs 113.18 billion (4.94 percent) in five months, the State Bank of Pakistan (SBP) reported on Thursday.

The interesting feature of the provisional data issued by the SBP reveals that the increase in the domestic debt during the first five months (July-November) of the fiscal 2006-07 was mostly due to rise in the stocks of floating and unfunded debt. The permanent debt declined rapidly during the period under review.

During the period, the floating debt increased by Rs 95.498 billion and unfunded debt by Rs 20.82 billion, whereas the permanent debt declined by Rs 3.137 billion.

The permanent domestic debt, comprising medium and long-term market loans, federal government loans, special government loans, federal instruments and prize bonds, stands at 497.01 billion, which was Rs 500.15 billion at the end of the fiscal 2005-06.

The floating domestic debt, mainly comprising short-term debt instruments and market treasury bills, maintaining a rising trend, was recorded at Rs 940.23 billion at the end of June 2006. And, during the following five months, it went up to Rs 1.035 trillion.

The data further shows that the unfunded domestic debt comprising National Saving Schemes (NSS) stands at Rs 873.32 billion. It grew by Rs 20.82 billion from Rs 852.49 billion at the end-June 2006.

However, it revealed that the net mobilisation under all instruments of the NSS were once again negative during the period but not so huge as recorded in the corresponding period last year.

The saving instruments ie Bahbood Saving Certificates, Postal Life Insurance and Pension Benefit Accounts and Mahana Amadani accounts increased. Net investment in NSS is gradually increasing because of increasing profit rate on these instruments.

Of these, three most popular instruments of the NSS ie 10-year Defence Saving Certificates (DSCs), five-year Regular Income Certificates (RICs) and three-year Special Saving Certificates (SSCs), net withdrawals were only Rs 8.58 billion in five months of this fiscal year.

It reveals that the erstwhile popular instruments - the DSCs, SSCs, and RICs - were comparatively attractive for investors during the period under review. Besides, withdrawals from special saving accounts and general provident fund during the period under study were Rs 22.4 million and Rs 1.079 billion, respectively.

The SBP data shows that Bahbood Saving Certificates and Pensioners Benefit Accounts attracted net fresh investment of Rs 24.49 billion and Rs 5.58 billion, respectively, while no investment was witnessed in Postal Life Insurance.


http://brecorder.com/index.php?id=521640&currPageNo=1&query=&search=&term=&supDate=