Pakistan Economy - News & Updates - Archive

[Owais]

$5 billion investment from Qatar likely in 3-4 years

ISLAMABAD (February 18 2007): Pakistan is likely to attract investment of $4-5 billion from Qatar during next 3-4 years as Pakistan and Qatar have reached a broad-based understanding on most of the issues, sources told Business Recorder.

They said that the Board of Investment (BoI) and the concerned officials in Qatar had held several rounds of talks and Pakistan was hopeful that the public and private sectors of Qatar would invest four to five billion dollars in oil and gas, telecommunication, roads infrastructure, power, and other sectors.

Sources said that government agencies were finding it hard to convince foreign investors to invest in Pakistan due to energy crunch the country is currently facing. Power shortage is fast becoming a major hurdle in the way of the overall investment, especially the foreign direct investment.

They said the upward trend in prices of utilities, especially gas and real estate, were seen as major challenges for policy makers in attracting foreign investment.

They said that the available gas reserves have already been committed to various industries and at present no gas was available for new investors. Pakistan would welcome foreign investment in energy sector at this critical juncture.

However, an official in BOI said that energy crunch was a challenge as well as an opportunity, for the rising demand of energy would help the government attract investment in the sector. He said there were greater opportunities for the investors in the shape of higher returns on less investment.

He said that the increase in the visits of public and private sectors from the West and the Middle East to the East, especially Pakistan, reflected the interest of the investors here. During the last one-year, or so, 60 full-fledged official delegations and 300 other delegates visited BOI and expressed their willingness to invest here.

He said that it would be a major achievement of Pakistan if it succeeded in attracting this big chunk of investment from Qatar. "The inflow of the investment is in the pipeline. There is likelihood that Pakistan enters into joint ventures with the public and private sectors of Qatar."

The official said that Pakistan would also look into the possibility of foreign investment in Pakistan's planned mega cross-border gas projects including Iran-Pakistan-India (IPI) gas pipeline, gas pipeline from Turkmenistan to Pakistan and also gas import from Qatar. Pakistan must implement at least one of these projects as early as possible and it is essential for maintaining the GDP growth at around 7 percent per year, the official added.


http://brecorder.com/index.php?id=529812&currPageNo=1&query=&search=&term=&supDate=

 

[Cheetah786]

Merrill Lynch bullish on Pakistan




By Dilawar Hussain

KARACHI, Feb 17: “Sell Indonesia, buy Pakistan”, the international financial services firm, Merrill Lynch (ML) recommends Pakistan, Sri Lanka, Vietnam and Mongolia as ‘new frontiers’ in their latest regional investment strategy report released on Thursday (Feb 15).

Among the four countries, Spencer White, the strategist who prepared the report says: “Pakistan remains one of our highest conviction overweight recommendations”. He reasons that the on-going economic reforms remains a core priority and that it should sustain high economic growth and lead to further financial stability, something which ML “feels the market has under-appreciated”. Best exposure to Pakistan has been recommended on rural expansion focus companies, which ML identifies as Adamjee Insurance; MCB; United Bank and Fauji Fertiliser Bin Qasim.

Talking about the region, ML says preference is shifting from China to Korea and Taiwan and the cyclic rotation from Singapore and Indonesia to Thailand.

“India remains unloved”, declares White. Finding commonalities in the four countries of the new frontiers (Pakistan, Sri Lanka, Vietnam and Mongolia), ML lists the following: All have GDP growth close to plus 8 per cent this year; privatisation across various segments of these economies is the key; This privatisation is a reflection of these smaller countries’ strong desire to “keep up with the Joneses” and all four countries fits the bill where “markets are better than broking, not the broking better than the market”.

The ML report discusses in detail why even among the four ‘new frontier’ countries, it considers Pakistan to be the “winner”. The report narrows down the choice between Pakistan and Vietnam.

It states that while ML likes Vietnam and had been overweight on that market for over a year, but its move from 300 to over 1,000 in the past 12 months meant it no longer was cheap. Almost three times as expensive as Pakistan and in spite of its improved turnover, Vietnam traded a sixth of what Pakistan does.

Showing almost a ‘crush’ on Pakistan, ML report mentions that Pakistan has the best privatisation-liberalisation programme of all four markets. “Unlike in India and Vietnam, there are no foreign ownership restrictions in Pakistan and you can own 100 per cent of any company in any sector”. In the past 18 months, Standard Chartered has bought Union Bank; China Mobile has bought Paktel and Philip Morris has bought Lakson Tobacco.

This year Pakistan State Oil (PSO) is to be privatised. The banks have been pretty much taken over by foreign players and all five cellular operators are foreign-owned, the report says.

In particular, says Merrill Lynch, we like the sustained high level of economic growth (plus 7 per cent) and Pakistan’s strong demographic potential for consumption.

As regards demographics, Merrill Lynch mentions that Pakistan has one of the world’s biggest populations. Of the 160 million, over 100 million are under the age of 21. And the report concludes: “This group will not retire until 2060 and will help power domestic consumption, which is already strong (e.g. growth in consumer staples, autos and telephony)”.
http://www.dawn.com/2007/02/18/ebr2.htm

 

[Neo]

Telenor adds 2.1m users

KARACHI: Telenor Pakistan added 2.1 million subscriptions during fourth quarter of 2006 while achieving the highest sales among all mobile operators in the country during the month of December 2006, said a company press release.

Referring to latest figures presented to 3GSM Conference in Barcelona, Spain, it said Telenor Pakistan’s estimated market share surged 3 percentage points and its contribution to Telenor Group’s net additions last quarter worldwide hit the 21 per cent mark.

Telenor Pakistan’s CEO Tore Johnsen said: “Today we have the second largest network with widest GPRS and EDGE capability, the most diverse product portfolio, the fastest growing distribution, and one of the strongest organisations in the industry.”

Revenue of Telenor Group in the fourth quarter of 2006 increased by 30 per cent to NOK 24.5 billion over same period of last year while full year revenues increased by 37 per cent to NOK 91.1 billion as compared to previous year. Its mobile subscriptions worldwide now stand at 115 million.

http://www.thenews.com.pk/daily_detail.asp?id=43318

 

[Neo]

February 18, 2007
US firm sets up $60m textile venture

By Sabihuddin Ghausi

KARACHI, Feb 17: A well-known US textile company - West Point - has set up a giant integrated textile mill on a 100 acres plot in Lahore in equal partnership with a local businessman to manufacture and export top-quality towels that has potential to fetch about $80 to $90 million a year.

“We signed the joint venture agreement in October 2006 for an investment of $60 million with equal equity shareholding,” Irfan Ahmad, the chief executive of the project informed Dawn by telephone from Lahore.

This is the first textile joint venture set up with an American investor in Pakistan by a local business group. None of any government agency played any role in this joint venture as according to Irfan Ahmad, the West Point was their trade partner for long.

The American textile companies had started moving out of South and North Carolina — two traditional textile centres in USA — more than a decade ago. West Point, too, explored to outsource its business in Pakistan. For towels, the choice of American investors is Indus Dyeing. The Pakistani business group, too, was looking for an American partner, who may help them to get them an access to the US market.

— “The project is in production and is operating at about one-third of the installed capacity,” the project chief executive said, who disclosed that the optimum level of production capacity will be reached by next September when more than 100 looms will be in operation to produce 850,000 pounds a week.

Pakistani partners are confident of making good money from towels export to USA in face of the high rate of import duty in USA for home textiles that ranges between 8 to 16 per cent.

But for circumventing duty on home textiles in local market, the American company has acquired a textile mill — Panama — in Bahrain from where the textile products are imported at zero rates. “So American textile groups are planning to come in a big way into Pakistan,” a local textile businessman said.

Market reports suggest that quite a few Pakistani textile operators have acquired well-known American brand names of textile products and plan to set up delivery infrastructure in the USA in collaboration with American partners.

The West Point is reported to be in negotiation with Pakistan’s top textile houses in Lahore, Karachi and Faisalabad to outsource is bed sheet business in partnership.

Another American textile company — Springs, which has been taken over and shifted to Brazil is also reported to be making investigations in Pakistan.

“None of Pakistan’s official agencies — Board of Investment — and others ever made any effort to market Pakistan as an investment place for textiles, which is the fourth largest producer of cotton in the world,” a local leader of All Pakistan Textile Mills Association (Aptma) said.

Pakistan, he asserted, offers investment opportunities from cotton plantation to ginning, spinning fine count yarns, weaving good quality fabrics, towels and bed sheets and other products of home textiles and garments.

There is a tradition of textiles in Pakistan dating back to Moenjo Daro times 5,000 years ago and a cheap labour that can acquire skill with training. The government needs to develop infrastructure facilities, ensure good governance that is found most wanting at present, particularly in respect of law and order situation and curtailing of corruption from top to bottom level.

Pakistani business groups need to develop management skills and an enlightened view that should take care of consumers and employees.

http://www.dawn.com/2007/02/18/ebr1.htm

 

[Neo]

February 18, 2007
Plans for engg sector’s growth awaiting govt approval

By Ihtashamul Haque

ISLAMABAD, Feb 17: The government is considering a set of proposals to accelerate slow pace of growth in engineering sector.

Official sources told Dawn on Saturday that President Gen Pervez Musharraf has directed the ministry of industries, production and special initiatives to incorporate the joint recommendations of the Higher Education Commission (HEC) and the Pakistan Institute of Development Economics (PIDE) in the new engineering vision for accelerating the sluggish growth of the engineering sector.

According to them, one of the many reasons for slow growth of engineering sector is lacking long- term vision for development. There is hardly any integrated and consistent approach towards the engineering sector.

“The productive sectors have been marred with irrational tariff structure", said an expert who was part of formulating recommendations to the government to promote the engineering sector.

However, he regretted that joint recommendations of the HEC and the PIDE are still to be approved by the government and placed before the president for a final approval, as originally planned.

The progress of Pakistan's engineering sector has been described as "less than satisfactory."

The contribution of engineering industry to the GDP is currently only $2 billion and it provides employment to a mere 600,000 people.

Pakistan saves $3.75 billion per annum through import substitution.

The rising trade deficit has been attributed by both HEC and PIDE mainly to engineering sector imports which are worth more than $2 billion (Rs132 billion).

The present share of the engineering industry in meeting the total demand is merely 25 per cent while the remaining demand is met through imports which have almost doubled over the last eight years. Its share in total imports has varied from 33 per cent to 42 per cent. The share of engineering goods in Pakistan's exports is only three per cent.

Pakistan exports $0.27 billion worth of engineering goods which is negligible in the world trade.

Major areas of imports include equipment for textile industry, energy sector, cement plants, agricultural machine, electrical machinery and automobiles etc.

According to the joint report of the HEC and PIDE, the potential to increase production of the engineering industry is large, and over the last one year engineering industry has done well, mainly due to rising domestic demand, emanating from consumer credit at lower interest rates.

But they said the regulatory mechanism was missing. The large-scale smuggling of electrical goods, such as air-conditioners, motors, fans, and household appliances, automotive parts and steel products etc., has also hit the engineering industry.

The local consumption of steel, which is one of the major indicators of industrial development, did not rise due to high prices of steel.

Moreover, for most of the engineering industries, effective protection was non-existent.

The main reason for the negative protection was high duties on inputs whereas outputs were generally imported duty-free under various concessionary tariff regimes or outright smuggled.

Therefore, local engineering industry has been deprived of a major business opportunity. The main causes of poor performance of engineering sector was absence of integrated approach for balanced growth of all economic sectors; lack of consistent policies and political will to develop local industry manifested in widespread smuggling of engineering goods; ad-hoc approach in policy formulation and preferences for turn-key import of plant and machinery; irrational and discriminatory tariff structure with relatively high import tariff on inputs and low zero rates on output/finished goods, along with cumbersome procedures for custom clearance of imported inputs; priority to less value-addition areas for investment and tariff support and lack of incentives to attract investment in high value-added sectors; lack of institutional support and incentives for acquisition and absorption of foreign technologies.

Unfavourable cost structure was due to lack of economy of scale in production, high financing cost, high inventory carrying costs, low labour productivity, high utility costs and high cost of local inputs, particularly steel products, lack of research and development and design, quality standards and engineering support which were resulting in inadequate vending, sub-contracting facilities; and lack of entrepreneurship and management skills.

"Pakistan needs to draw upon the experience of Malaysia and Korea by developing, strong technical manpower which can take the responsibility for absorbing and adopting technologies to produce products of high quality and improving the productivity levels".

In 1995, the government had set up the Engineering Development Board (EDB) for providing policy direction and impetus for growth of the engineering sector. The mandate of the Board was to suggest policy initiatives, provide leadership role, and act as a bridge between the government and the entrepreneurs / investors in this sector to ensure achievement of set objectives.

This step has made a beginning to create a policy environment which is more conducive for survival and growth of local engineering industries, a lot still has to be done for achieving the potential growth rates.

Both the HEC and PIDE believe that a result-oriented policy package, fully backed, strengthened and implemented in its true spirit with an integrated approach focusing on overall development of all sectors of economy is required.

"Obviously it will only be possible if there is a strong political commitment at the highest level for development and growth of engineering sector."

The most important step for promotion of engineering sector in Pakistan is to allocate more resources to basic and technical education.

The existing institutions are not fully equipped to provide requisite skilled manpower for producing quality products. There are only 10 universities and colleges which offer degree courses to engineering students. Enrolment in these colleges and universities is less than 20,000.

Another component of the engineering education is the polytechnic diploma which trains associate engineers. There are a total of 58 polytechnic institutes in the country which provide three-year diplomas to students. The total enrolment in these institutes is 75,000.

The vocational training institutes are also limited in number. The country has only 364 such institutions which provide one and two years certificate and diploma courses to students. The enrolment in these institutions is only 11,500. However, most important is the fact that the graduates produced by these institutions are not in line with the demand.

Just by banning the imports of turn-key imports in power sector in 1992, the local industry benefited tremendously and it resulted into more indigenisation and technology transfer.

As a result of the decision, local manufacturers were awarded business for Muzaffargarh Unit-4, being set up by Chinese.

Long-term plan was also drawn for indigenisation under consortium arrangement with reputable foreign technology partners to achieve a deletion level of about 55 per cent over a period of five to seven years.

"For development of engineering sector, enhanced private sector participation not only in production, but also in the training of workers is crucial".

The role of public sector, the HEC and PIDE report said, should be confined to providing conducive and enabling environment through provision of appropriate physical, as well as human resource infrastructure.

Public sector should provide vision, policy direction and policy instruments and help develop design engineering capabilities, databases and infrastructure: create testing labs and instruments and start projects with the private sector partnership.

"The private sector should innovate and develop new products and processes."

http://www.dawn.com/2007/02/18/ebr4.htm

 

[Neo]

Cotton production to enhance 20.70 million bales by 2015

ISLAMABAD: February 18, 2007: Cotton, a major crop of the country, is a source of production for textile sector and earns foreign exchange for the country.

The cotton production is gaining momentum and registering new records with the passage of time due to use of new varieties and modern techniques of cultivation.

The government is taking affective measures to increase cotton production in the country and enhance crop's yield to 20.70 million bales by the year 2015, said agriculture development commissioner Qadir Bux Baloch.

He said the decision to this effect has been taken after thorough study and consideration of various options for production enhancement. It is realised that a production level of 20.70 million bales could be achieved by 2015 with a modest increase of 25,000 acres.

The area under the crop increased to 3.32 million hectares as against the estimates of 3.22 million hectares for 2005-06, showing an increase of 3 per cent. The hectare yield also increased to 1,060 kilograms from the provisionally estimated yield of 686 kilograms for the current season.

The plan titled "Cotton Vision 2015 Targets" has been initiated after taking into account the future prospects for a sustained growth in cotton sector and the possible improvement in the quality of raw cotton.

The targets of the plan also envisages increase of cotton yield per acre to 1,060 kilograms from current estimate of 686 kilograms, Mill Consumption of Cotton to 20.10 Million Bales, Exportable Cotton Surplus to 0.60 Million Bales, Improved Yarn Recovery Rate to 92 per cent from current average of 84 per cent.

The plan has been designed to achieve higher production of clean cotton to obtain advantages of assured supply of clean, graded and contamination free cotton to the domestic textile industry.

It may also helpful to get higher recovery rate, hence more yarn, improved reputation of Pakistan's cotton and its products in the world market and substantial additional foreign exchange earning through better unit values.

During the decade ending 2004-05, cotton production in the country registered an annual growth of 6 per cent, realised through 2 per cent increase in area and 4 per cent increase in hectare yield. The raw cotton consumption by the textile industry at the same time is increasing by 4 per cent annually.

The textile industry placed the current consumption of raw cotton at around 15 million bales based on certain assumptions, whereas the Textile Commissioner's Organisation estimated it at 12.5 million bales for 2004-05.

However, cotton consumption in the country during the last decade registered a growth rate of about 4% annually on average basis.

Based on a similar growth pattern in years to come the mill consumption requirements are estimated to be 18.5 million bales i.e. 42 per cent higher than the current level of consumption, said Hafeezullah a textile mill owner.

The likely consumption by 2015 may also be considered on the basis of growth in the working spindles during the last 10 years which averaged at 3.16 per cent annually.

Taking this growth rate into consideration and a maximum of 1.5 bales consumption per spindle, the requirements by 2015 work out to be 17 million bales.

The working group constituted by the MINFAL for projecting the demand of raw cotton by the domestic textile industry have also envisaged the minimum mill consumption of raw cotton by 2015 at 18.5 million bales.

All Pakistan Textile Mills Association (APTMA) has, however, recommended to place the textile industry's raw cotton requirements by 2015 at 20.10 million bales, comprising of medium staple (66), long staple (26%) and the extra long staple (8%).

It is realised that the varieties in vogue as well as in the pipe line would sufficiently meet the medium, medium long and the long staple requirements of the textile industry in future.

For attaining the above envisaged cotton production target, besides ensuring adequate and timely availability of necessary inputs, production loans and technology transfer at the grass root level with particular reference to the scientific crop and pest management, the research institutes are required to expedite development of cotton leaf curl virus resistant varieties, transgenic cotton varieties (Bt cotton) and cotton hybrids, said Ahmed, a cotton grower from Rahim Yar Khan.

Despite being hand picked, the raw cotton produced in the country is contaminated with different types of non-lint contents due mainly to improper picking and handling practices and the absence of quality based marketing system.

The government has taken several measures in the meantime to encourage cotton pricing and marketing on the basis of quality considerations. The Pakistan Cotton Standards Institute has already developed the cotton standardisation and grading system which is yet to be implemented at the grassroots level, Qadir Bux Baloch said.

The marketing mechanism of cotton may be improved through enforcement of provisions of the Pakistan Cotton Standardisation Ordinance 2002, Baloch said adding, under this the Pakistan Cotton Standards Institute should concentrate on technical aspects such as preparation of grade boxes, training of graders, fibre testing facilities and the arbitration services, etc. whereas implementation of the grading system and certification may be carried out by the private sector inspection companies as per provisions of the above said ordinance.

The private sector may be encouraged for developing a net work of fibre testing laboratories for instrumental evaluation of raw-cotton throughout the cotton belt.

At the same time, the Pakistan Cotton Standards Institute should expedite setting up of the five fibre testing laboratories in major cotton growing districts for which a project has already been approved under the public sector development program.

http://www.brecorder.com/

 

[Neo]

India, Pakistan trade potential more than $9 bn: WB director

HT Correspondent

Mumbai, February 18, 2007

World Bank managing director Graeme Wheeler said on Sunday that India-Pakistan trade has the potential to cross $9 billion in the next five years from the current $1 billion, if barriers relating to policies, infrastructure, corruption and red-tape are addressed.

“Everyday we see obstacles – protective policies, poor infrastructure, corruption and red-tape. Trade between India and Pakistan is about $1 billion a year. Without barriers, it could be $9 billion within five years,” Wheeler said at the SAARC business leader’s conclave here.

Citing geography and its young population as the two major weapons to fight poverty, he said South Asian nations needed to integrate for the economic betterment of the region. Pointing out that severe infrastructure bottlenecks impede the region’s growth, he urged countries to share energy and water resources.

“Trade integration is a major opportunity. But regional cooperation in energy and water could produce even bigger returns. India, one of the most energy-hungry nations in the world, sits next to three energy-surplus countries namely, Bangladesh, Nepal and Bhutan. Yet, except for Bhutan, energy trade between them is miniscule,” Wheeler observed.

He said that for South and East Asia to be the growth hubs of global economy, countries in the region should transfer their dynamism in services sector to manufacturing.

However, when asked about the threats posed by a two-year high rate of inflation in India and expectations of a higher current account deficit fuelled by high domestic demand for imported goods, he declined to comment.

Speaking at the conclave, the former chairman of the US Federal Reserve, Paul Volcker, who had led the UN investigation into the Iraq’s food-for-oil scam that threw up the name of former external affairs minister Natwar singh, stressed on the need to deal with corruption and implementation of a more transparent regime in developing countries.

“Corruption is a tax on the poor. Lack of transparency and corruption are pervasive and if not curtailed would be self-defeating. Strong responses to specific instances of corruption is warranted,” he said.

Commenting on the worrisome rate of inflation the country is facing, Volcker said that surging inflation in India was a matter of concern, but added that the response of the Reserve Bank of India was on track.

India’s rate of inflation had of late hit a two-year high of 6.73%, well above the central bank’s projection of 5-5.5%, thus forcing it to hike the cash reserve ratio of banks by one per cent in the last three months.

http://www.hindustantimes.com/news/181_1931279,0002.htm

 

[Janbaz]

Japan keen to invest in Pakistan’s energy projects

ISLAMABAD: Japan has said that it desires to invest in the energy projects of Pakistan, but it would not provide funds for the construction of Pak-Iran-India Gas Pipeline project.

In a briefing to the newsmen here, Japanese Ambassador, Seiji Kojima said that his country was aware of Pakistan’s energy requirements. He said that Japan could provide help to Pakistan in all sorts of energy sources except the nuclear energy. Japan has given $430 million loan to Pakistan during the last two years and it wanted to extend the development help to $500 million.

Japanese Ambassador told that the Japan-Pakistan talks on anti-terrorism measures would be held some time in April in Islamabad. The agreement to end double taxation between the two countries was also expected, for which, Pakistan finance ministry officials would be visiting Japan next week.

Geo TV.
http://www.geo.tv/geonews/details.asp?id=2282&param=3

 

[Janbaz]

Pakistan to become main energy artery of region: Shaukat inaugurates oil and gas moot

ISLAMABAD (February 19 2007): Prime Minister Shaukat Aziz on Sunday highlighting the importance of energy security and its relevance to progress said that the government has been working with a vision to meet Pakistan's growing energy needs through exploring all types of energy including gas, oil, hydel, winds, solar and coal.

He was addressing the inaugural session of third Pakistan Oil and Gas Conference 2007, here at local hotel which was attended by the representatives of oil and gas industry besides over 30 delegates from abroad.

The Prime Minister said water, energy and food security are the most important elements and the government taking measures to ensure these securities in the country.

Shaukat Aziz said, "We are also working to leverage our potential to become a main energy artery of the region as Pakistan enjoys pivotal position at the crossroads of three vital regions of the world, South, Central and West Asia."

He said development of intra-regional gas pipelines, investment in upstream industries and harnessing alternative source of energy is of the crucial importance for ensuring energy supply to meet the growing demand in the country.

The Prime Minister said talks on the multi-billion dollar gas pipeline from Iran are positive as the negotiations on tariff and volume between Pakistan and Iran are in the final stages.

He said Pakistan has also invited India to join this gas pipeline but added that if India will not join, Pakistan will definitely finalise the deal with Iran.

The Prime Minister said in the regional context, due to consistent high economic growth in Pakistan, India and China are spurring an unprecedented energy demand as these are the biggest markets in the region.

He said, "We, therefore, need to exploit all available resources of commercially viable energy-both domestically and as well as from abroad-and demonstrate a greater commitment to energy efficiency and conservation."

He said the energy consumption in the developing countries including Pakistan is roughly growing at double the global average rate and it is estimated to rise by more than 100 percent by 2010 from the existing levels. Pakistan, he said, is also negotiating on gas pipeline from Turkmenistan and other regional countries to meet its growing demands.

Referring to deep-sea port at Gwadar, the Prime Minister said, it had the potential of providing an outlet to Central Asian oil and gas for consumption in other countries of Asia. He said Gwadar would be made an energy city.

He said, "We are encouraging construction of oil refineries and large-scale storage of petroleum products in Gwadar and added that a mega-refinery is being set up at Khalifah Point by Abu Dhabi."

LPG POLICY:

Prime Minister Shaukat Aziz said due to Liquefied Petroleum Gas (LPG) policy announced by the government, the prices of LPG have been decreased in the market.

He said the government announced LPG Policy 2006, which envisages continuation of deregulation and fixing of LPG prices by companies on a competitive basis.

The LPG policy, he said, proved very effective in reducing the prices.

The Prime Minister said due to LPG policy its import has been opened up which decreases the prices of the LPG in the market. He said an investment of Rs 9 billion has already been made so far in this sector and there is a big market in Pakistan where LPG would be used as a preferred domestic fuel.

The Prime Minister said in order to ensure that the energy supplies should keep pace with the rising economic activities, and to ensure that the energy supplies continue to support economic growth, the government on the one hand is targeting to enhance the local production of hydrocarbons through increased exploration and on the other hand aiming to materialise plans for the import of natural gas from Iran and other Central Asia.

Earlier, Minister for Petroleum and Natural Resources Aman Ullah Jadoon speaking on the occasion highlighted the liberal policies of the government in the oil and gas sector. He said the needs of the country have been increasing and it would be more than double by 2020, therefore, Pakistan is making efforts to explore all possible means of energy.

Vice President of Shell, Martin Trachael presenting keynote address highlighted the increasing demand of energy and possible ways to import it from other countries to meet its growing needs.

Petroleum Institute of Pakistan Chairman Munsaf Raza speaking on the occasion said the main purpose of the conference is to discuss and find ways and means to meet the growing demands of Pakistan.

Business Recorder.
http://www.brecorder.com/index.php?id=530086&currPageNo=1&query=&search=&term=&supDate=

 

[Janbaz]

Country expects $6 billion foreign investment this year: Tareen

ISLAMABAD (February 19 2007): Pakistan was expecting a record foreign direct investment of around six billion dollars this year owning to its liberal, consistent and investment-friendly economic policies.

Minister for Industries Jehangir Khan Tareen on Sunday told Radio Pakistan that country was becoming a regional hub for investment where multi national companies were taking keen interest to invest in different fields.

A chain of Industrial estates like Sunder Industrial State is being established in four provinces to steer the nation to the path of rapid industrialisation.

The government is committed to streamline all available resources to ensure rapid development and prosperity of common man.


Business Recorder.
http://www.brecorder.com/index.php?id=530165&currPageNo=1&query=&search=&term=&supDate=

 

[Neo]

Establishment of plasma gasification plant on cards

KARACHI (February 18 2007): City District Government Karachi (CDGK) is considering setting up a power plant called 'Plasma Gasification' in collaboration with a Malaysian firm at the cost of $70 million in the metropolis. A senior CDGK official told Business Recorder on Saturday that initially the Malaysian firm had presented its idea of the project.

The proposed plant will be established on 40 acres of plot within two years, which will generate 31-MW electricity through converting waste into energy, he added. Technology, which was called Plasma Gasification, had been introduced in 1962 for the first time and now it was being used for energy generation in different countries of the world, he told.

It was new idea for the city government and it needed to be studied thoroughly, he clarified. The CDGK will take decision in this regard soon after the final report of the project is submitted to the City Nazim Syed Mustafa Kamal, he said. However, he ruled out any early agreement between CDGK and the Malaysian firm on the installation of the proposed plant.

"CDGK is not fully aware of the project as it is new to it, however it will look into the project's viability whether or not it is feasible to be installed in the city," he added.

The official said that CDGK had some reservations over the technical design of the plant. "The CDGK wants a by-product of around 8000 to 10,000 ton garbage being produced in the city on a daily basis and this kind of plant could provide us with an opportunity to meet energy needs of the city," he said.

http://www.brecorder.com/index.php?id=529848&currPageNo=1&query=&search=&term=&supDate=

 

[Neo]

Govt working with vision to meet Pak's growing energy demands: Aziz
Monday February 19, 2007

ISLAMABAD: Prime minister Shaukat Aziz Sunday expressed the hope that the work on multi-billion dollargas pipelines from Turkmenistan and Iran will start at the earliest, which will open doors of prosperity and development for people living in this region.
Addressing Oil and Gas Conference here, the prime minister said in view of the fact that energy security remains vital to progress and development, our government has been working with a vision to meet Pakistan's growing domestic energy requirements over the short, medium and long term.

"We are also working to leverage our potential to become a main energy artery of the region. Pakistan enjoys a pivotal position at the crossroads of three vital regions of the world - South Asia, Central Asia and West Asia. No other country is strategically better located than Pakistan to become a safe and short energy supply corridor," he held.

The premier said today one of the biggest global challenges that humanity faces is how to meet the rapidly growing energy demand, which is crucial for sustaining our progress and development. Soaring energy consumption, coupled with high oil prices, has compounded this challenge. Energy consumption in the developing world is roughly growing at double the global average rate. It is estimated to rise by more than 100 percent by 2020 from the existing levels.

In our regional context, he said consistent high economic growth in Pakistan, India and China is spurring an unprecedented energy demand. We, therefore, need to exploit all available resources of commercially viable energy - both domestically as well as from abroad - and demonstrate a greater commitment to energy efficiency and conservation.

The prime minister said the energy requirements of Pakistan itself are rising sharply on the back of increased economic activity and growth, which has been in the region of 6 to 8% in the last few years.

"We hope to sustain this level of economic growth. However, we need to ensure that our energy supplies keep pace with the rising economic activity. Pakistan's energy demand is set to increase by 8 to 10 percent annually. By 2020, our primary energy needs are likely to more than double to 177 million TOE (Tonnes of Oil Equivalent) from today's 58 million TOE," he maintained.

He added: "We are meeting a major portion of our commercial energy needs from domestic resources and the gap is being filled through import of petroleum products.

To ensure that our energy supplies continue to support economic growth, the premier said our government on the one hand is targeting to enhance the local production of hydrocarbons through increased exploration and on the other hand aiming to materialize plans for the import of natural gas from Iran and Central Asia.

To meet the growing demands of power plants / IPPs and industrial consumers, additional gas supply is being arranged through import of LNG (350 - 500 mmcfd). Our Government has also approved LPG Policy 2006 which envisages continuation of deregulation and fixing of LPG prices by companies on a competitive basis. An investment of Rs. 9 billion has already been made so far in this sector. There is a big market in Pakistan where LPG would be used as a preferred domestic fuel.

Today one of the biggest global challenges that humanity faces is how to meet the rapidly growing energy demand, which is crucial for sustaining our progress and development. Soaring energy consumption, coupled with high oil prices, has compounded this challenge. Energy consumption in the developing world is roughly growing at double the global average rate. It is estimated to rise by more than 100 percent by 2020 from the existing levels.

The premier went on to say that Pakistan has constructed a new deep-sea port at Gwadar which has the potential of providing an outlet to Central Asian oil and gas for consumption in other countries of Asia. We are encouraging construction of oil refineries and large-scale storage of petroleum products in Gwadar.

"A Mega-Refinery is being set up at Khalifah-Point. Our government is providing all the necessary incentives, regulatory framework and infrastructure facilities in Gwadar to ensure that it becomes one of the key regional ports and economic hubs in the shortest span of time," he held.

We are trying to diversify the sources of energy and maximize output from hydro-power and other alternate energy sources including solar, wind, bio-gas and bio-diesel. Our government is also actively planning to launch major coal-based power projects, especially in Sindh province, where we have large deposits of coal. Import of electricity from Iran and Central Asia is also under process. We have a large piped gas network in our country. Our vision is to improve technologies that can help make all energy resources compatible with an efficient market and help us ensure a clean environment.

He also said that the promotion of clean fuels is essential to stop environmental degeneration and to curtail the emission of poisonous gases in the atmosphere. Environmental preservation remains high on our agenda.

"In order to improve the specifications of petroleum products in line with international standards and introduce environment-friendly fuels, we have taken various steps. Mono Grade 87 Octane Motor Gasoline has been introduced throughout the country, which has eliminated the menace of adulteration. Unleaded Gasoline has also been introduced. All refineries have been advised to install desulphurization plants and commence production of Euro-III standard HSD with effect from 1st January, 2008," he noted.

The premier said Pakistan is one of the most attractive destinations for foreign investment in the oil and gas sector. The foreign companies, which operate in Pakistan, have expanded rapidly. This should give confidence to other investors who can avail the opportunities available here.

"We seek more and more partnerships with international oil and gas exploration and production companies. In the 21st century, public-private partnership offers the main business model that is now central to any successful strategy at a time when exploration has become a high-stake venture. Partnerships between Pakistani and international companies are already bringing latest, cutting-edge technology. They are also providing invaluable services in human resource development. The government will continue to encourage this trend," he held.

The sound energy management and application of new environmental technology, he said is not just discovering and exploiting new energy resources, but also protecting and using them judiciously. This is imperative to protect our environment and sustain the pace of progress and development for our present and future generations.

http://www.paktribune.com/news/index.shtml?169459

 

[Janbaz]

Cellular subscribers top 50 million

All set to launch MNP on March 23

By Imran Ayub

KARACHI: Cellular subscriber base has crossed the 50 million mark and experts see the service adding another 10 million users by the end of current financial year.

Latest figures compiled by the Pakistan Telecommunication Authority (PTA) suggest the total number of cellular service users stood at 50.75 million by January 2007, which were 34 million by end-June 2006.

“In absolute terms, total number of cellular subscribers stands at 50,756,502 (50.75 million), which shows an increase of 47 per cent during the first seven months of the current fiscal,” said an official at the PTA.

“There is also a 4.1 per cent increase if we compare such figures with the previous month (December 2006). In fact, there is an exceptional jump in cellular subscriber numbers.”

He said in the calendar year 2006 almost 29 million new connections were sold by the six cellular companies on comparatively cheaper tariff offers and increased network reach of the service providers.

“So there was over 147.44 per cent rise in the cellular subscriber base in a single calendar year,” said the PTA official. “Four major companies - Mobilink, Ufone, Al Warid and Telenor - got better market share during the first seven months of 2006-07, who attracted subscribers with different tariff packages and incentives.”

The PTA figures show by January 2007 Mobilink led the market with 23.29 million subscribers, followed by Ufone, which was serving 10.55 million people across the country.

With the arrival of the UAE-based Al Warid Telecom and Norway’s Telenor, both competition and subscriber base grew at a much faster pace, as they attracted 7.9 million and 7.6 million subscribers respectively by the end of January 2007.

The cellular density witnessed a phenomenal jump in the last two years as the mobile phone subscriber base grew by a staggering 170 per cent during 2005-06, outnumbering almost six-decade-old fixed-line telephone service by more than 500 per cent in 16 years of operation.

Analysts see the cellular service growth in line with expectations, but say 2007 appears to be challenging for the cellular companies, when the MNP (mobile number portability) system is expected to be put in place.

“The cellular operators may continue such growth for the next few months,” said Anwaar Ahmed Khan, Head of Research at Inter Securities Management Limited. “In fact, reduced tariff and increased number of destinations have made the cellular service within reach of the low income group.”

The cellular operators expect a cutthroat competition after the MNP system is implemented across the country.

“The MNP would decide the real market leader. After the MNP implementation, the companies must have to improve their service quality in order to keep their subscribers,” said a senior official of one of the companies.

The MNP is a system that enables a mobile phone subscriber to carry the same number while changing the service provider. The system, which requires an investment of over Rs500 million, was originally due in November 2005 but was delayed for more than a year by the operators.

Now the companies have set March 2007 as the new deadline for project completion and seem confident to meet it.

“The MNP is almost ready to be launched,” said the cellular company official. “There were some complications in the project, which have been removed and proper service would be available to the subscribers from March 23, 2007.”

The News.
http://thenews.jang.com.pk/daily_detail.asp?id=43574

 

[Janbaz]

Ministry sets $1 billion IT export target by 2010

ZAHEER ABBASI
ISLAMABAD (February 20 2007): The Ministry of Information Technology has set $1 billion export target of IT-enabled services by 2010 and asked the China to construct IT parks each in Islamabad, Lahore and Karachi on Built Operate and Transfer (BOT) basis, it is learnt.

Sources said that these parks would be built to accommodate about 200,000 IT graduates in next three to four years to meet the set export targets. The ministry has also discussed the idea of setting up IT parks with the Prime Minister.

They said that the IT exports as reported by the State Bank of Pakistan (SBP), were $72.210 million during 2005-2006 which grew up to $48 million in the first half of 2006-07 ie till December 2006. A 17-member Chinese delegation led by Zhao Wenzhi, Deputy Director General, Foreign Affairs Department of the Ministry of Information Industry included senior officials of Chinese Ministry of Information Industry and leading executives of ICT companies from China held talks with the IT Ministry officials and Managing Director Pakistan Software Export Board, Yusuf Hussain.

It was learnt that the Chinese delegation was shown sites selected for IT parks and asked to invest on BOT basis and import IT-enabled services from Pakistan instead of other countries. The IT Ministry will invite interested parties through advertisement if a positive response was not received from China which was offered for investment.

Presently, the USA, Canada and Europe are the major destinations of Pakistan IT enabled export. "The PSEB, working on different thrust areas, also took the issue of skilled manpower with the Higher Education Commission (HEC) and asked it to improve the standard of IT education. The bandwidth quality is another issue needed to be addressed if the target is to be achieved," they added.

They said that the Pak-China Joint Working Group on Information Technology had also agreed to enhance collaboration in IT would evolve strategies to target global markets and also increase trade between the two countries.

The meeting noted that the Chinese IT industry has achieved rapid growth in the last four years with domestic revenue at $48 billion. IT exports and outsourcing in China also witnessed a rapid growth.

Talib Baloch Secretary PSEB talking to Business Recorder said officials of both the countries recognised that Pak-China collaboration in Information Technology would benefit both the countries. He said that the eight strategic areas have been identified as facilitation, human resource development, industry finance, marketing, office space provision, public policy, quality and telecom bandwidth provision to achieve the target.

Business Recorder.
http://www.brecorder.com/index.php?id=530358&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

Uzbekistan and Turkey keen to promote trade with Pakistan

PESHAWAR (February 20 2007): Uzbek and Turkish ambassadors on Monday vowed for promotion of bilateral trade, exchange of trade delegation and signing of agreements to promote investment with Pakistan in general and NWFP in particular.

The two Islamabad-based Uzbek and Turkish envoys during their visit to Sarhad Chamber of Commerce & Industry (SCCI) also agreed for facilitating business communities of both sides and promoting close relations among the chambers of commerce and holding of production exhibitions and business conferences.

Uzbek ambassador, Oybek Arif Usmanove and Turkish ambassador Rauf Engin Soysal separately visited the Sarhad Chamber and hold different meetings with the SCCI officials. Acting President, Sarhad Chamber of Commerce & Industry, Haji Mohammad Israr Saraf presided the meeting.

SCCI vice president, Haji Manzoor Ahmad Paracha, Ghulam Sarwar Khan Mohmand, Zahidullah Shinwari, Sharafat Ali Mubarak, Shaukat Ali Khan, members of the executive and prominent industrialists and traders attended the meeting.

The Uzbek ambassador addressing the meeting said the exchange of trade delegations could help promote bilateral trade between the two Muslim states. He hinted at signing of agreements for promotion of cooperation in different sectors between Uzbek and Sarhad Chamber. "For this purpose the SCCI members would be welcomed to Uzbek embassy in Islamabad, whenever they like," added Oybek Arif Usmanove. He said that Uzbekistan was ready to offer cooperation for development of agriculture sector in Pakistan.

Turkish ambassador Rauf Engin Soysal vowed for taking all possible measures to promote bilateral trade between Turkey and Pakistan, saying the exchange of trade delegations would be ensured to bring business community of both countries closure to each other. The NWFP, he said, was geographically situated in a very important region of world, saying that a group of Turkish businessmen would soon visit Pakistan.

In his two separate but identical welcome addresses, acting president of SCCI, Haji Mohammad Israr Saraf stressed for promoting business and economic relations with both Muslim states. He said that initiating of joint ventures could play important role in promotion of investment.

Talking to Uzbek envoy, he called for holding a conference in Peshawar to promote trade contacts between both countries. He also suggested for holding an exhibition of Turkish products in Pakistan.

http://brecorder.com/index.php?id=530413&currPageNo=1&query=&search=&term=&supDate=