Pakistan Economy - News & Updates - Archive

[Neo]

Wednesday, January 31, 2007

OMV Boosts Production at Pakistan's Sawan Gas Field

Oil and gas company OMV said its unit OMV (Pakistan) Exploration has increased turnover at the Sawan onshore gas field by 15 percent to 66,700 barrels of oil equivalent a day (boe/d).

As the largest foreign gas field operator in Pakistan, OMV (Pakistan) acts as plant manager in the Sawan field, in which it has a 19.74-percent holding. Other sizeable stakeholders in the joint venture are Italy's Eni AEP and Pakistan Petroleum Ltd, with holdings of 23.68 percent and 26.18 percent, respectively.

Operating in Pakistan since 1991, OMV (Pakistan) Exploration Ltd is a wholly owned unit of Austria's OMV and provides 16 percent of the country's gas needs.

http://www.rigzone.com/news/article.asp?a_id=40651

 

[Neo]

1/31/07

Iran-Pakistan-India gas pipeline may not be a pipe-dream anymore

Islamabad, Jan 31, IRNA-Strong positive indications have emerged recently that the multi-billion Iran-Pakistan-India (IPI) gas pipeline will go ahead, a leading Pakistani analyst has said.

With a thaw in India-Pakistan relations, and flexibility on the part of Iran on the pricing issue, the pipeline may not be a pipe-dream anymore, as some cynics have been commenting, Rasool Bakhsh Raees has said.

One can catch a dreaming glimpse of regional cooperation in the report that Iran, India and Pakistan have finally agreed on a pricing formula after years of haggling, Raees said in an article published in" Daily Times".

Describing the project as being of vital importance for three countries, he said it will allow Iran to gain access to one of the largest markets for energy resources.

India and Pakistan with their growing economies will have secure and long-term supplies to meet their increasing need, he argued.

Talks on building the Iran-Pakistan-India gas pipeline began in 1994, more than twelve years back but progress on this multi-billion- dollar project has been held hostage to India-Pakistan tensions, Raees observed.

He said that energy cooperation would create and deepen intra-state and intra-regional interdependence.

Energy cooperation and mutual interdependence between India and Pakistan would create a better environment for resolving old conflicts and create more avenues of openness, he said.

Raees said that Pakistan stays committed to allowing this pipeline to cross through its territory.

He said India's participation in IPI will send a positive signal to banks and companies that may invest in this project.

There are a number of multinationals in the field from the US, Netherlands and Australia that have shown tremendous interest in this and similar projects and are willing to build the pipelines.

http://www.payvand.com/news/07/jan/1358.html

 

[Neo]

EU offers 200 million euros aid package to Pakistan
31 January 2007

(BRUSSELS) - The European Commission on Wednesday proposed a 200-million-euro (260-million-dollar) aid package to Pakistan over four years, much of it to be spent on rural development.

Commissioner for External Relations and Neighbourhood Policy, Benita Ferrero-Waldner, presented visiting Pakistani Prime Minister Shaukat Aziz with details of the package, which requires European parliamentary approval.

A major portion is earmarked for rural development in the North West Frontier Province and Baluchistan -- poor, tribal areas bordering Afghanistan -- "to strengthen natural resources management, develop community physical infrastructure and to improve livelihoods and employment opportunities, thus contributing towards enhancing Pakistan's economic and social cohesion."

The second focus area is education and human resources development "to help advance access to education and better service delivery," the Commission said in a statement. Particular care will be taken for women and girls to benefit from these activities.

"We have proposed to significantly step up our assistance to Pakistan in the next years," Ferrero-Waldner said.

"The overall aim of European Commission operations in Pakistan is to fight poverty and to help Pakistan in following a sustainable growth path and a stable development.

"Rural development, natural resources as well as education and human resources development are vital areas towards this aim."

From 2002-2006, the European Commission, apart from contributions from individual EU member states, provided a total of 125 million euros in development funding to Pakistan, of which most was spent on education, financial sector reforms and trade development.

Following the devastating earthquake of November 2005, the Commission committed an additional amount of 98.6 million euros for humanitarian relief and reconstruction.

Text and Picture Copyright 2007 AFP. All other Copyright 2007 EUbusiness Ltd. All rights reserved. This material is intended solely for personal use. Any other reproduction, publication or redistribution of this material without the written agreement of the copyright owner is strictly forbidden and any breach of copyright will be considered actionable.

http://www.eubusiness.com/news_live/1170270078.99

 

[Neo]

Indonesia backs Pakistan bid to be ASEAN partner

01/31/2007

JAKARTA -- Indonesian President Susilo Bambang Yudhoyono said Wednesday he supports Pakistan's bid to become a dialogue partner of the Association of Southeast Asian Nations (ASEAN) later this year.

"Indonesia...supports Pakistan becoming a full dialogue partner of ASEAN, which is something that will be discussed in the ASEAN forum," he said at a joint press conference with his visiting Pakistani counterpart Pervez Musharraf.

Musharraf said he brought up the issue during talks on economic and diplomatic issues.

"I raised this issue of Pakistan's desire to become a full dialogue partner within the ASEAN and I must express my gratitude to the president for his expression of support... during the summit meeting this year," he said.

The two leaders also agreed to enhance economic cooperation.

"Bilaterally, we agreed to intensify our economic cooperation, particularly on trade and investment and, given the impressive economic growth of Pakistan, which can be combined with Indonesia's growth, there will be a lot of opportunities to come out of this intensified cooperation," Yudhoyono said.

He said they did not discuss specific economic issues.

Indonesia is Southeast Asia's largest economy and the most populous member of ASEAN, which groups the country along with Brunei, Cambodia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam

http://newsinfo.inquirer.net/breakingnews/world/view_article.php?article_id=46730

 

[Contrarian]

Cheers! Hope the IPI pipeline materialises!

 

[Neo]

Cheers!

Is India ready to go ahead with the project despite growing pressure from Washington to isolate Iran?
Pakistan would go ahead with the project with or without US' blessing.

 

[Janbaz]

Agriculture performance remains below target

ZAMIR SHEIKH
KARACHI - The agriculture performance remained below the expected target fixed by the government during FY 06 as production of three major cash crops sugarcane; cotton and wheat, decreased as compared to the last fiscal.
Although the 13 million bales output in FY06 is the second largest cotton crop harvest in Pakistan’s history, it was 9.1 per cent lower than the record output of 14.3 million bales seen in FY05.
Cotton holds a key position in the agriculture sector as well as in the economy and it directly contributes 8.6 per cent to agriculture value addition and 1.9 per cent to the GDP. It is also a major industrial input and contributes to the larger part of the country’s exports. This decline in the cotton production was due to the combined impact of a fall in planted area and yield per hectare.
Sugarcane was the other major Kharif crop that witnessed a decline in area under cultivation during FY06. This was mainly due to the disappointing prices received by farmers in the preceding two years as well as a fall (at sowing time) in availability of irrigation water. As a result, sugarcane production witnessed a fall of 5.3 per cent to 44.7 million tons during FY06, compounding the impact of the significant 11.6 per cent fall in the preceding year.
The wheat harvest decreased by 1.4 per cent in FY06 to 21.3 million tons, which was also 3.6 percent below the annual target fixed for the year.
Provisional estimates suggest that the wheat harvest fell by 1.4 per cent in FY06 in contrast to a remarkable 10.8 per cent increase in FY05. The decline was mainly attributed to a 2.6 percent fall in the wheat yield during FY06.
The State Bank data shows that decline in yield is a function of delayed sowing of wheat crop due to the late crushing of sugarcane and extended cotton picking season and adverse weather conditions.

The Nation.
http://www.nation.com.pk/daily/feb-2007/1/bnews3.php.

 

[Janbaz]

Ferozsons lab signs deal with Biocon-India
MASHIUR RAHAMAN
KARACHI - Ferozsons Laboratories Limited has recently signed an agreement with Biocon-India for the Pakistan commercial rights to monoclonal antibody product, Biomab EGFR, The Nation learnt on Wednesday.
In accordance with regulation no. 28 of the Listing Registrations of the Stock Exchange, the Ferozsons Laboratories had conveyed relevant information to the Karachi Stock Exchange. According to the notice, the Biocon-India, which is the largest biotech company in India has signed above agreement with the Ferozsons Laboratories for the commercial rights to monoclonal antibody product, Biomab EGFR. The product is indicated for the treatment of head and neck cancer and being studied in global clinical trails for colorectal, lung cancer, glioma and pancreatic cancers.
The products which has been developed by Cuba’s Center for Treatment of Immunology (CIMAB), is being commercialised in the region by Biocon under a 50-50 joint venture with the CIMAB. Approximately 25,000 patients are diagnosed annually with head and neck cancer in Pakistan, according to the notice.
This signed agreement is likely to enhance the Ferozsons Laboratories reputation in laboratory business and its share in Pakistan stock market is likely to grab market players attention beside developing cancer treatment in Pakistan, concerns stated.
Ferozsons Laboratories board of directors meeting on January 27 announced company’s individual profit and loss account for the second quarter ended Dec 31.
The earning per share was announcer at Rs 4.54 where it was Rs 4.21 per share during the same period of 2005. The net profit after taxation was announced at Rs 54million for the same period. On the other hand, the IGI Investment Bank Limited recently has decided to issue 100 per cent right share into the open market, The Nation learnt on Wednesday.
The IGI Investment Bank Limited (Formerly First International Investment Bank Limited) held its board of directors meeting last week, which reached to the decision of issuing 100 per cent right share at per Rs 10 per share, that is one share for every existing share, in compliance with section 5 of the companies (issue of capital) rules, 1996.
Beside those, according to a notice issued by the NIB Bank Limited, it has cancelled its scheduled board meeting on Feb 01. “Due to certain reasons beyond our control, we will not be able to hold the board meeting. The new date of meeting will soon be rescheduled,” said the notice.

The Nation.
http://www.nation.com.pk/daily/feb-2007/1/bnews4.php.

 

[Janbaz]

Mobilink and RIM promoting trade in Pak

OUR STAFF REPORTER
ISLAMABAD - Mobilink participated as a business partner, in the event organised by Research in Motion Ltd (RIM) BlackBerry, Ontario a company statement said here on Wednesday.
The High Commissioner of Canada HE David B. Collins hosted a luncheon in honor of Premier of Ontario, Dalton McGuinty, and his trade delegation. The Premier led a trade mission to Pakistan on an invitation by the Punjab Government, with the aim of bringing Ontario and Pakistan based firms together to promote trade. Pakistani and Ontario based companies signed various agreements, it added.
Research in Motion Ltd (RIM) Blackberry service is offered exclusively in Pakistan by Mobilink, and has gained widespread acceptability in corporate Pakistan. BlackBerry is a leading wireless enterprise solution offered by RIM and has been introduced by Mobilink in Pakistan. This platform provides users around the world with convenient and wireless full access to business applications that include Email, Phone, SMS, Web, and Organiser features.
, Mobilink CEO Zouhair A. Khaliq said that Mobilink has established itself as a favourite cellular service of Pakistan while Research in Motion is a leading designer, manufacturer and marketing organisation for innovative wireless solutions for the world mobile communications market.
Both brands are market leaders in their respective areas, which makes a natural partnership that has great potential to create the most powerful state of art communication tool, he added.

The Nation.
http://www.nation.com.pk/daily/feb-2007/1/bnews7.php.

 

[Owais]

July-January revenue target surpassed: Rs 457.5 billion collected

ISLAMABAD (February 01 2007): The Central Board of Revenue (CBR) has collected Rs 457.5 billion in July-January 2006-2007 against Rs 369.8 billion in the corresponding period last fiscal, denoting an increase of Rs 87.7 billion. According to the provisional figures released on Wednesday, the board has surpassed the revenue target set for the first seven months of 2006-2007.

The provisional tax collection indicates a cumulative growth of 23.7 percent. The break-up revealed that the revenue on account of direct taxes was Rs 184 billion in July-January 2006-2007 against Rs 114.4 billion collected in the same period last fiscal, showing growth of 60.9 percent.

Sales tax collection has reached Rs 169.5 billion against Rs 154.9 billion, indicating a growth of 9.4 percent. The growth in sales tax collected at the import stage was 4.3 percent, while the domestic sales tax collection has witnessed a growth of 17 percent.

The collection of Federal Excise Duty (FED) was Rs 34.6 billion in July-January 2006-2007 against Rs 29.5 billion in the same period last fiscal, showing an increase of 17.4 percent. The collection of customs duty was Rs 69.3 billion during the first seven months of current fiscal against Rs 71 billion in July-January 2005-2006, reflecting a negative growth of 2.4 percent.

The Central Board of Revenue has attributed this decrease in collection due to declining imports during the period under review. The provisional collection was Rs 47 billion during January 2007, which is expected to further increase in coming days after compilation of final figures, the Central Board of Revenue added.

http://brecorder.com/index.php?id=523980&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

Country losing $2.5 billion annually to inefficient road freight industry

KARACHI (February 01 2007): The inefficiencies of country's road freight industry are costing roughly Rs 150 billion, or $2.5 billion, annually to the national exchequer. The present industry structure cannot integrate into international trucking nor can support the country's projected economic growth and, unfortunately, the trade would stay reliant on such industrial infrastructure due to the absence of alternative options.

According to documents available with Business Recorder, there are three major areas identified for such losses of inefficient road freight sector, which are Rs 60 to 90 billion per year spent on extra fuel cost and subsidies on the use of diesel, Rs 30 to 35 billion in additional road user costs and about Rs 25 billion contributed to the infrastructure deficit. A highway constructed for 10-year efficient life for freight traffic has been damaged only in 18 months period.

Low quality of service is impeding the country's trade competitiveness for imports and exports. Freight sector demands are unbalanced, and majority of consumers is not aware of 'externalities' unwilling to pay the right price.

The industry is responding by over-supplying of illegal and unregulated services. Competing in an 'illegal market' is keeping the freight industry from responding appropriately.

Experts believe that as far as structure of road freight industry is concerned, the domestic demand is much higher than the international demand and 90 percent or more of all land freight in the country is 'trucked' and this would double in the next ten years.

They say that segmentalisation of demand is very weak and poor; reliance on 'inter-modalism' as railways is not delivering the adequate service levels for speedy freight movement.

Almost all trade is conducted through two seaports in the south, and one out of every three truck trips is for agricultural sector use. The geographical distribution of demand is uneven due to major share of Punjab in both internal and external trade. The consumer tariffs, which have consistently fallen in real terms over the last 20 years, are among the lowest in the world.

Majority of the consumers, further negotiating down rates with little or no expectation for improvement, is stuck in a rut. The share of manufacturers and general merchandise is rising rapidly and these (and other) high-value exporters and customers are willing to pay higher.

The current available capacity is higher than demand, but this availability is illegal. The trucking equipment is under-developed and outmoded and the same holds true for all not significant road infrastructure, freight stations, terminals, trailers, sales, service, support and driver training.

Another aspect of cargo safety is under-developed cargo insurance practices and absence of mechanisms for access to finance at the right cost. The country's trucking industry is not practically deregulated. In reality, it is poorly regulated as per the market trends for owning the vehicles.

The experts say that the freight sector is superficial and a very fragmented industry, but few informal financiers consolidate it at the back, though. The absence of appropriate standards, registration and fitness certification system has distorted supply side incentives, and ill-informed industry and trade associations do not have the professional service users' control rates.


http://brecorder.com/index.php?id=524008&currPageNo=2&query=&search=&term=&supDate=

 

[Owais]

Investment in oil and gas exploration and power sectors

ISLAMABAD: Canadian Frontier Holdings and Petroleum Exploration Limited would invest $200 million in oil and gas exploration and power sectors in Pakistan under joint venture investment plan.

President of Frontier Holdings, Nigel McCue accompanied by Chairman, Petroleum Exploration Limited, Zaheeruddin called on Minister for Petroleum and Natural Resources, Amanullah Khan Jadoon here and briefed him about the investment.

During the meeting, Nigel McCue informed the Minister that Frontier Holdings has entered into partnership with a Pakistani company Petroleum Exploration Limited (PEL) that has resulted in acquiring working interests in seven concessions held by the PEL.

He told that the joint venture intends to set up a power plant of 60-120MW at Sukkur based on the huge low BTU reserves of its Kandhra gas field.

He said the development of Kadhra gas field resources of 3.4 trillion cubic feet would be main source of gas supply to the power facility.

They have also planned the drilling of development wells with a view to ensuring a sustained gas supply to power plant by investing $160 million, which is expected to be commissioned in 2009 involving further investment of $60 million.

http://geo.tv/geonews/details.asp?id=1549&param=3

 

[Neo]

Unemployment rate goes down: minister

ISLAMABAD (February 01 2007): The government on Wednesday claimed that its pro-poor policies had generated five million job opportunities in the country during last two years to help reduce the unemployment rate from 7.7 per cent in 2003-04 to 6.2 percent in 2005-06.

Addressing a news conference here, Federal Minister for Labour and Manpower Ghulam Sarwar Khan said that due to provision of equal job opportunities for males and females, the unemployment ratio had reduced significantly among both sexes.

Statistics he came up with indicated the unemployment rate for males and females had decreased from 6.6 per cent to 5.4 per cent and 12.7 per cent to 9.3 per cent respectively.

Referring to a survey, the minister said that employed labour force in the country was 42 million in 2003-04 that had now reached at 47 million with an average growth rate of 5.7 per cent. He added that estimated labour during 2004-05 was 45.5 million that had gone up to 50 million in 2005-06 and this 4.5 million rise in labour force indicated and average growth rate of 4.9 percent that was result of excellent economic growth rate of around 7 percent.

Talking about various sectors, the minister said that agriculture was still the largest employment-absorbing sector with about 43 percent followed by industry with 20 percent. Sarwar asserted a significant rise had also been observed in the number of Pakistanis going abroad in the year of 2006.

A total number of 184,274 proceeded abroad for employment during 2006 as compared to 142,135 during 2005, an increase of 28.57 percent. The main destination of Pakistani labourers was UAE where 100,207 workers were recruited.

A substantial number of 45,594 Pakistanis proceeded to Saudi Arabia, 12,614 to Oman, 10,545 to Kuwait, 4,757 to Malaysia, 2,247 to Qatar, 1,741 to United Kingdom (UK), 1,630 to Bahrain, 1,082 to South Korea and 202 to USA.

The figure reflects high concerns of the government to export it manpower. High level bilateral contacts had been established with Saudi Arabia, Bahrain, UAE, Qatar, Kuwait, and South Korea for import of manpower from Pakistan, he added.

To enhance the capability of skilled labour proceeding to South Korea, the minister had arranged Korean language course at Islamabad and all provincial capitals, the minister said.

The other steps in this regard were the activation of Community Welfare Attaché (CWA) officers in the countries with which MoUs had been signed and removal of security related concerns of employers.

The category wise break of worker who went abroad in 2006 was: labourers 74,157, drivers 14,084, agriculturist 10,762, mason 9,695, carpenter 8,819, technicians 8,152 and steel fixer 6,310.

http://www.brecorder.com/index.php?id=524038&currPageNo=1&query=&search=&term=&supDate=

 

[Neo]

PEL, Canadian JV to invest $200m in oil, power sectors

ISLAMABAD: President of Canadian Frontier Holdings, Nigel McCue accompanied by Chairman, Petroleum Exploration Limited, Zaheeruddin called on Minister for Petroleum and Natural Resources, Amanullah Khan Jadoon here on Wednesday and briefed him about the joint venture investment plan of $200 million in oil and gas exploration and power sectors.

During the meeting, Nigel McCue informed the Minister that Frontier Holdings has entered into partnership with a Pakistani company Petroleum Exploration Limited (PEL) that has resulted in acquiring working interests in seven concessions held by the PEL.

He told that the joint venture intends to set up a power plant of 60-120MW at Sukkur based on the huge low BTU reserves of its Kandra gas field.

He said the development of Kadra gas field resources of 3.4 trillion cubic feet would be main source of gas supply to the power facility.

They have also planned the drilling of development wells with a view to ensuring a sustained gas supply to power plant by investing $160 million, which is expected to be commissioned in 2009 involving further investment of $60 million.

Chairman, PEC, Zaheeruddin informed that the Canadian company would not only bring new technology to Pakistan but also utilize its expertise in drilling a number of exploration development wells during next three years in concessions blocks required by the Joint Venture.

Welcoming the Chief Executives of Canadian Frontier Holdings and PEL, the Minister said the government was taking concrete steps to exploit the untapped hydrocarbon resources in order to meet the growing energy needs of the country.

He said that the government was opening new blocks in the coming days, which would promote the oil & gas exploration in the country.

Jadoon appreciated the PEL’s contribution for promoting the oil and gas exploration activities in the country and invited the joint venture to avail the investment opportunities in the upcoming projects for the mutual advantage.

http://www.thenews.com.pk/daily_detail.asp?id=41056

 

[Neo]

Pakistan ranked higher than neighbours: Zahid

KARACHI: International business community ranked Pakistan much higher than its neighbours and praised the recent mergers and acquisitions in the financial and telecom sectors in the country at World Economic Forum (WEF) recently concluded at Davos.

Zahid Hamid, Federal Minister for Privatisation & Investment and a member of Prime Minister’s official entourage said this in a statement after his return from Brussels, Belgium on Wednesday.

He termed Prime Minister Shaukat Aziz’s participation at WEF meeting and his official visit to Brussels remarkably successful.

He said that foreign investors expressed great interest in Pakistan and appreciated the investment-friendly policies and outstanding economic performance of the country during last several years particularly rate of growth and record levels of foreign investment.

In a meeting with the Prime Minister, renowned Professor Michael Porter of Harvard Business School disclosed that according to a recent survey Pakistan was ranked much higher than its neighbours in so far as dynamism, competitiveness and ease of doing business are concerned.

He said that foreign investors expressed great interest in Pakistan and appreciated the investment-friendly policies and outstanding economic performance of the country during last several years particularly rate of growth and record levels of foreign investment.

The recent mergers and acquisitions in the financial and telecom sectors in Pakistan in particular were frequent topics of conversation among the international business community.

Zahid Hamid said that Pakistan was now very prominent on the radar screen of international investors and they were closely monitoring its progress and development on the economic and investment front.

The Chief Executives of a number of leading institutions appreciated the government’s economic reforms and expressed their intentions to either make fresh investment or further increase their investment in Pakistan.

Carlyle Group of UK, which manages a major private equity fund, indicated that they would be earmarking funds for investment in Pakistan. Similarly, Chief Executive of Nestle informed the Prime Minister of their plans to substantially enhance their operation in Pakistan by increasing their investment. Metro Cash & Carry also plans to establish retail outlets all over the country. Unilever and Seimens also discussed future plans involving enhanced investments.

Elucidating details of the WEF meeting, Zahid Hamid said that the Prime Minister had 45 meetings with heads of states, chief executives of MNCs and representatives of civil society and media.

The Prime Minister participated in panel discussions on terrorism, nuclear proliferation, women’s empowerment and inter-religion harmony.

He further informed that the Prime Minister had a number of useful meetings in Brussels with overseas Pakistanis and foreign investors and delivered major policy addresses to European Union’s Committee on Foreign Affairs of the European Parliament.

http://www.thenews.com.pk/daily_detail.asp?id=41057