Pakistan Economy - News & Updates - Archive

[Owais]

Pakistan, South Africa to enhance bilateral ties


ISLAMABAD (updated on: March 14, 2007, 02:53 PST): Pakistan and South Africa Joint Commission agreed to further enhance the bilateral co-operation in fields of education, culture and tourism, defence and intelligence and security co-operation in drug related issues.

The Joint Commission was established between Pakistan and South Africa on March 9, 1999.

The Inaugural session of the Joint Commission was held here on 12-13 March 2007.

Riaz Muhammad Khan, Secretary Ministry of Foreign Affairs led the Pakistan delegation while Dr. Ayanda Ntsaluba, Director General South African Department of Foreign Affairs led the South African side.

At the conclusion of the Join Ministerial Commission both the sides also signed the agreed minutes of the commission meeting and exchanged documents between the two countries in this regard.

According to the agreement, in order to enhance the level of bilateral trade both sides agreed to finalise the trade agreement by end of May, 2007.

The South African side would undertake a technical visit to Pakistan shortly to explore the available opportunities of investment and this visit will form the basis of more detailed work programme between the two countries.

It was agreed to encourage respective private sectors to explore establishment of a Joint Business Council to institutionalise mutual interaction amongst the private sectors.

To unlock the potential in vestment and industrial co-operation both sides agreed to identify areas of synergies and complementarities in facilitating focused business co-operation.

The Pakistan side requested the visiting South African delegation to expedite the initiation of the agreement relating to co-operation in Science and Technology, within two months.

Both sides agreed to enhance the co-operation in the field of agriculture with special focus to livestock, rinderpest, quarantine matters, exchange of various seeds, pesticides, export of fruit/vegetables and Vapour Heat Treatment (VHT).

Both sides agreed to share the experiences of each other in the areas of coal gasification technology, value addition in mineral and power generation, including information sharing on the Pebble Bed Modular Reactor initiative for mutual benefits.

Both sides also agreed to finalise the MoU on maritime co-operation and extradition treaty at the earliest.

Both sides expressed concern over the increasing trend of drug trafficking between both the countries and agreed to finalise Memorandum of Understanding for intelligence and security co-operation in drug related issues.

As an important manufacturer of pharmaceutical items and surgical equipment, the Pakistan side undertook to provide a list of these items and equipment for possible export to South Africa.

The Pakistan side offered the services of highly skilled, semi-skilled and unskilled labour to South Africa in different fields.

Both sides agreed to constitute a joint committee comprising specialists from each side to discuss and finalise agreement regarding immigration, consular affairs and visa requirements.

Both sides agreed to further enhance the bilateral co-operation in the field of education, culture and tourism.

Pakistan proposed an MoU for promotion of tourism between the two countries.

It was also agreed that a technical team from South Africa will visit Pakistan in July as a follow up and identify the sectors of trade and investment between the two countries.
brecorder.com

 

[Owais]

Foreign investment to reach $6 billion this year: Salman

KARACHI (March 14 2007): Adviser to Prime Minister on Finance, Revenue and Economic Affairs, Dr Salman Shah, has said that the inflow of foreign investment in the country is likely to touch six billion-dollar mark this year. Addressing the ACCA Pakistan's CFO Conference's inaugural session as chief guest at a local hotel here on Tuesday.

Shah said that foreign investment played an important role in the economy of Pakistan, as the country had ample manpower and the inflow of capital triggered generation of employment opportunities.

"We have a very stable economy today and the government aims to maintain and entrench the hard won economic stability. We all aim to make Pakistan a true economic power, for that it has to be a centre of enterprise and innovation. The government's vision for Pakistan is to be location of choice and the place for business. This is possible but for that we need strong public-private partnership. The government and business need to be working on shared national economic purpose," the adviser said.

To a question about the GDRs of United Bank Limited (UBL), National Bank of Pakistan (NBP) and Kapco, to be launched in the international markets, he said these were in process and as soon as the process was completed, the GDRs would be launched, hopefully this fiscal year.

He said that efforts would be made to complete the GDRs within this financial year but this would depend on the pace of processing by the Privatisation Commission. Dr Shah expressed satisfaction over the performance of the Central Board of Revenue (CBR), adding that the government was endeavouring to broaden the tax base, as unless and until the base was expanded, the rate of tax could not be brought down.

About the export target, the adviser said that the target was achievable, adding that Pakistan was strongly competitive in the textiles market while the government was also taking concrete measures to widen the export base and addressing the weak quarters to achieve the 45 billion-dollar export target by 2013.

Pakistan was situated at such a strategic location between the Asian economic giants, ie India and China, that left the country at an ideal location to serve as the logistic chain and trade corridor, he said, adding this was a high potential area attracting large-scale investment.

Dr Salman Shah appreciated the ACCA Pakistan for holding such a conference. Finance and accounting high-ups have gathered from far and wide in Karachi to participate in the CFO Conference, organised by ACCA Pakistan.

ACCA President Dennis Yeates, in his speech said: "The key lesson to learn from the major financial debacles is the need for a top to bottom ethics-based culture. And these are mirrored in the views of CFOs in this region with more than half believing they are responsible for promoting an ethical culture and should set a good example".

He further said: "Ethics is at the core of ACCA's reputation and influence around the world. This is why we ensure that our ethical code complies with the IFAC code of ethics for professional accountants and will always comply with that code". ACCA Pakistan President Arif Masud Mirza presented the welcome address.

APP ADDS: Dr Salman Shah said Pakistan's development programme was growing very rapidly, adding that there was a need of expanding tax base, which would help enhance the revenues to be utilised for development purposes. He pointed out that the country's development programme is growing very rapidly and that the construction of schools, hospitals and road etc, would be from the revenues generated by the CBR.

"However, this does not mean to recover more tax from those who are already paying the taxes", Dr Salman remarked adding that this means that the tax base be expanded as far as possible so that there could be contribution of all for the development of the country. Replying a question, Dr Salman said that the existing current account deficit was because of the rapid economic growth of the country.

He stated that in the import bill, the imports machinery, raw materials, energy etc, were being financed. He was of the view that the country's balance of payment would be in surplus and the reserves would go up. Dr Salman said that efforts were aimed at meeting the exports target for this year. In a longer time frame, the country's economy had a lot of resilience and many of the sectors could come in exports.

Value addition can be undertaken in certain areas of food products and that there can be expansion in the engineering products besides the information technology-related programmes.

Replying a question, Dr Salman said that the allocation of resources to the provinces was being made in accordance with the amended NFC award by the President of Pakistan. This would continue to be done till a new NFC award was made and for this the role of the provincial governments was more than that of the federal government, he added. He said that if the provinces through consensus come up with a formula, which was a better one then this would be implemented.

At the moment the amended award given by the President is a better one and under this all the provinces are being given substantially increased resources and there is no particular complaint from anyone.
http://brecorder.com/index.php?id=538057&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

Pakistan's economic growth attracts more UAE investors

ABU DHABI (March 14 2007): The economic relations between the United Arab Emirates (UAE) and Pakistan witnessed remarkable growth, with surge in Emirati investors looking to take advantage of growth opportunities taking place in Pakistan.

Emirates Investment Group is now considered one of the largest investment companies in Pakistan with its recently launched financial towers in Karachi. Emirates Global Islamic Bank, launched by major Gulf investors, is considered one of the most modern Islamic banks in the country, strength of Islamic banking facilities and technical investment infrastructure provided to Pakistan banking sector.

In this regard, significant role was played by Sheikh Tariq bin Faisal Al Qasimi, Chairman Emirates Investment Group and Chairman Emirates Global Islamic Bank, in developing these new investment sectors and introducing modern concepts to business sector of Pakistan.

Sheikh Tariq Al Qasimi said: "Diversification is important requirement in any investment portfolio. This helps us create and take advantage of opportunities that can benefit from managerial skills that utilises a long vision of economy; resulting from a strong familiarity with economic rules and regulations," he said. He spoke of how a revolution it its economy now had helped it to be on a par and take advantage of global growth opportunities.

Gulf investors and businessmen are playing major role in development, increase of economic, financial arena, industrial, banking foundations where Pakistan hopes to achieve positive results from rapid economic plans with the UAE in particular and the Gulf Cooperation Council (GCC) states in general.

http://brecorder.com/index.php?id=538148&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

Germany ready to help enhance product competitiveness

KARACHI (March 14 2007): Consul General of the Federal Republic of Germany, Hans-Joachim Kiderlen has said Germany is ready to help Pakistan where it wants to enhance its products compatibility in the European Union (EU) countries' markets. Speaking at a meeting of Karachi Chamber of Commerce and Industry (KCCI) on Tuesday, he said that Free Trade Agreement (FTA) with India would not hit Pakistan.

He also hoped that Pakistan and Indian both will fully employment South Asian Free Trade Agreement (SAFTA) as well as resolve the issue of Kashmir. He said that the EU is also trying to become a partner of SAARC countries. He appreciated Pakistan's act of taking back its national landed on the EU soil illegally.

Speaking on the occasion, British Deputy High Commissioner. Hamish ST Clair Daniel, OBE, said that in the last three years a number of British trade delegations visited Pakistan and now enjoying business with Pakistani counter parts.He assured the members of KCCI that the British companies would participate in the coming KCCI exhibition in June 2007 Consul General of Poland, Ireneusz Makles said that Pakistan is a very important country for the EU in South Asia. He praised quality of Pakistan products and said that they are of high quality and offered at reasonable price. Pakistan is also a fast developing country, he added.

He said that a high powered delegation of mining industry will visit Pakistan in next month to see the environment of co-operation and establishing joint venture units.

He said that both the countries have lot of potential to boost two way trade.

Consul General of France, Pierre Seillan said that the EU countries are in a process to have a constitution. He said that there are 27 members of the EU and agreeing on one constitution is a difficult task but not impossible. Every country has its own problems and thinking, he added.

Welcoming the guests, President, KCCI, Majyd Aziz said that EU countries relocating industrial units due to high cost of production and suggested that they should consider Pakistan as one of the best place for relocation.


http://brecorder.com/index.php?id=538085&currPageNo=2&query=&search=&term=&supDate=

 

[Neo]

Pakistan eyeing $300m United Bank share sale

HONG KONG/KARACHIMarch 14, 2007: The government plans to sell a stake worth up to $300 million in United Bank Ltd (UBL) through a global share sale, and it has invited six investment banks to pitch for the deal, people familiar with the matter said on Wednesday.

Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, JPMorgan and Merrill Lynch are all bidding for the $200 million to $300 million global depository receipt (GDR) sale, the sources said.

A government source said the decision for the deal's lead manager would be made by early April, and the deal should be completed by the end of June. The government is only selling part of its roughly 45-percent stake in UBL.

UBL shares fell 2.15 percent, while the Karachi 100 Index was down only 1.09 percent.

The government has been trying to offload part of its stake in UBL since June 2005, when it tried to sell 15 percent through an initial public offering that eventually failed to draw enough subscribers.

A consortium of UAE-based Abu Dhabi Group and British conglomerage Bestway Group bought 51 percent of UBL from the government in 2002.

The government was planning a 20 percent stake sale in February 2006, according to a government source, but the deal never made it to the market.

Pakistan is being tipped by foreign investment bankers as a potential hotbed of equity issuance activity as the country's economy is growing at nearly 7 percent and the government is pushing to privatise some of its biggest companies.

The country's largest listed firm, the Oil and Gas Development Co, raised $813 million through a GDR sale in December, and the government is also planning a stake sale of top oil marketing firm Pakistan State Oil.

The Karachi 100 is up 12 percent this year after a 5 percent increase in 2006. Pakistan began popping up on the radar screens of foreign investors after the index soared 54 percent in 2005.

Pakistan's liberal foreign investment rules, which can be rare in emerging markets, are a further draw to overseas buyers.

http://www.brecorder.com/

 

[Neo]

Wednesday, March 14, 2007

Feasibility studies of 10 hydropower projects finalised

By Sajid Chaudhry

ISLAMABAD: Feasibility studies of ten hydropower projects have been finalised to make sure availability of 11635-megawatt electricity in the system upon completion in next three to seven years.

According to Medium Term Development Framework 2005-2010, total electricity demand in the country, which stands at 16,600 megawatt in fiscal year 2006-07, would be around 21,500 megawatt in fiscal year 2009-10. The power demand in the fiscal year 2009-2010 is estimated at 9,531 megawatt for domestic, 1408 megawatt for commercial, 2097 megawatt for agriculture, 9,267 megawatt for industrial and 1341 megawatt for other consumers in fiscal year 2009-2010.

According to a project performance report of March 10, 2007 available with Daily Times, the feasibility study of Dasu hydropower project has been completed that would make addition of 3700-megawatt electricity in the system and expected to be completed in 7 years. The study on cost of the project is underway, however, offices of consultant and field offices have been established. The consultant has submitted inception report.

Study on $117 million Golan Gol hydropower project is also completed and this project would make available 106-megawatt electricity in the system upon completion in 4 years. Financing for these projects are available Kuwait Fund has provided $37 million, Saudi Fund $40 million and OPEC $30 million. Consultants are being engaged for preparation of detailed design and tender documents.

Bunji hydropower project’s feasibility study is in hand which is worth $3.865 billion and would contribute 5460-megawatt electricity in the system upon completion in next 7 years. Consultants are being engaged to implement this project.

The feasibility study of Keyal Khwar hydropower project is also completed, its estimated cost has been worked out to be $120 million and would make addition of 130-megawatt electricity in the system on completion in next four years. This feasibility study is being upgraded with financial assistance of the Kuwait Fund.

Feasibility study of the Lawi hydropower project has been finalized however cost estimates are being completed. This project would make addition of 90-megawatt power in the system in next four years. PC-II and detailed engineering design of the project is under preparation. A 545-megawatt Spat Gah hydropower project’s feasibility study is in hand, however, cost estimates are being finalized. M/S ILF of Germany have been appointed as the project consultant and this project would be completed in next five years.

Feasibility study of the Palas Valley (Chor Nallah) is being carried out with financial assistance from Kuwait Fund grant. Cost of the project is being finalised and this will make addition of 386-megawatt hydropower in the system when completed in next five years.

Kohala hydropower project’s feasibility study is in hand and cost estimates are also under study. This project would make an addition of 1100-megawatt hydropower in the system in next 5.5 years. Appointment of consultants is underway.

Feasibility study of Phandar hydropower project has been completed by HEPO and ZTZ. This project would be completed with a cost of $53 million in next three years and would make an addition of 80-megawatt power in the system. PC II for detailed design and tender documents have been submitted to the Ministry of Water and Power on January 20, 2007.

Feasibility study of the Basho hydropower project has been completed and $27.35 million to be the cost of the project. This project would make an addition of 28-megawatt power in the system in next three years. PC II for detailed design and tender documents has also been approved. Expression of Interest (EOI) for short listing of consultants issued on February 22 and last date for submission is April 3, 2007.

http://www.dailytimes.com.pk/default.asp?page=2007\03\14\story_14-3-2007_pg5_1

 

[Janbaz]

Chinese co to set up mobile phones plant

OUR STAFF REPORTER
Karachi - Advisor to the Prime Minister on Finance Dr Salman Shah has said that government has decided to permit a Chinese company to establish a mobile phone manufacturing plant in Pakistan.
He was talking to the media men here on Tuesday. Dr Salman said that keeping in view the import bill of $1billion of mobile phones of the country, the government had decided to allow Chinese company to establish a mobile cell plant in Pakistan. He said that government was trying to expand the tax net to reduce the burden on the existing taxpayers. He also said that the Central Board of Revenue (CBR) remained quite successful in few years in expanding its tax base by improving the revenues. He further said that the CBR was using those revenues to improve the basic infrastructure in country.
Salman Shah also pointed out that Foreign Direct Investment (FDI) in Pakistan would hit US $6 billion in current fiscal year. He was of the view that the current account deficit and balance of trade against Pakistan was the manifesto of the robust economic growth as huge machinery and other equipments were being imported in large amount to give boost to the industrial sector. He hoped that Pakistan would regain its current account deficit and balance of payment surplus also. Answering to a query, he said that the government was committed to get the export target of $45 billion in the year 2013, for this purpose government was diversifying the export base as well to include food products, engineering items and IT products side by side with the textile sector”.
About the National Finance Commission (NFC) awards, he said that the provinces had full freedom to formulate any formula acceptable to all but he was of the view that till now, the formula presented by President General Pervez Musharraf was the most suitable in this regard. He further said that GDR of HBL, UBL and CAPCO would be completed in this fiscal. He said that government was also working to improve the rating of Pakistan on World Economic Forum (WEF).
Addressing to the ACCA Pakistan Conference on “CFOs: Challenges and Opportunities”, he said that the rapidly growing public and corporate sector of Pakistan needed professional accountancy and financial up gradation. He said that this type of conferences helped to bring innovativeness in the economic field. He appreciated the initiative by ACCA Pakistan of arranging a CFO conference that provided an opportunity to the accounting and finance professionals of Pakistan to listen to a number of international and corporate sectors of Pakistan.
ACCA President Dennis Yeates said that the key lesson to learn from the major financial debacles was the need for a ‘top to bottom’ ethics based culture and these were mirrored in the views of CFOs in this region. He said that the ACCA ensure ethical code complies with the IFAC Code of ethics for professional accountants and would continue to comply with that.

The Nation.
http://www.nation.com.pk/daily/mar-2007/14/bnews1.php

 

[Owais]

50 exploration companies bidding for 17 gas fields

ISLAMABAD (March 15 2007): Fifty world reputed gas exploration and production (E&P) companies have submitted bids with the ministry of Petroleum to contest for 17 onshore and offshore blocks for gas production.

The office of the director general Petroleum Concession (DGPC) is processing the applicants' bids and their work plan for gas exploration in Pakistan and it will hold open bidding for allotment of blocks once the spadework is over.

Petroleum Minister, Amanullah Khan Jadoon, gave detail of the bidding for the new blocks and the new Petroleum Policy during a meeting with OMV's senior vice president who called on him here on Wednesday.

He said that the new petroleum policy would entail lucrative incentives for the prospective local and foreign investors in the onshore and offshore oil & gas exploration.

The minister said that Pakistan has a vast onshore & offshore sedimentary area 827,000sq km out of which around 25 percent was under exploration. He said that the government was taking concrete steps to exploit the untapped hydrocarbon and coal reserves to meet the growing energy need of the country. He said that 17 new blocks in offshore and onshore areas were being opened shortly which would boost the oil & gas exploration activities in the country.

The Minster appreciated OMV's contribution for promoting the oil & gas industry in Pakistan and invited the company to make more investment for the mutual advantage. He lauded the company's interest to increase its oil & gas exploration involvement in collaboration with the local companies.

Wolfgang briefed the minister about OMV's world-wide involvement in the oil & gas exploration activities including in Pakistani areas of district Khairpur, Sindh from where it has been producing about 550 million cubic feet gas daily by investing $450 million.

The managing director of Fugro Robertson who also called on the minister said that his company is providing consultancy to OGDCL in Pakistan basins study project aimed to identify petroleum prospects of different sedimentary basin of the country which would help to promote exploration activities. He told that the company would be participating in new blocks bidding which were under evaluation.

http://brecorder.com/index.php?id=538373&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

Economy growing in spite of trade deficit: CBR chairman

FAISALABAD (March 15 2007): Economy is growing in spite of trade deficit, however, exporters have to overcome their inherent weaknesses and deficiencies to face the future challenges and survive in the competitive international markets, said Central Board of Revenue (CBR) Chairman Abdullah Yousuf.

He was addressing the exporters and businessmen in the conference ball of Pakistan Textile Exporters Association (PTEA) here on Tuesday. He said our economy had successfully absorbed the repeated crisis, fomented by record increase in oil prices coupled with shocking earthquake of October 8. "It would be difficult for us to survive with previous fragile economy," he added.

The chairman said that exports were only solution to overcome trade deficit and asked the exporters to play their role in increasing national exports, adding that first of all exporters should overcome their own weaknesses and deficiencies to survive in the international markets.

Abdullah Yusuf said we had potential to double our textile exports from existing 10 billion dollars to 20 billion dollars and in this connection private and public sector had to move ahead with unanimity of purpose.

He said we needed local and foreign investment to increase our production capabilities, and added that government was already making efforts to facilitate the exporters and investors.

He further said that we had some difficulties in facing challenges of quota -free regime, however, time had come to take bold steps to produce quality products with lowest possible production cost. In this connection, he particularly mentioned Human Resource, weaknesses of labour deficiency of technology management failure, high logistic cost and many other factors to become cost effective.

The second option would be merger of various organisations to survive economically in this world, he said, adding we must work hard with a futuristic vision to remain competitive and to arrest poverty and unemployment.

He said exports in Pakistan had already been declared zero-rated and old pending sales tax cases were being resolved on top priority basis. Responding to a question, the CBR chairman said that some proposals had been received to replace some pre-emptive with actual taxes, however, no final decision had yet been taken.

Earlier, PTEA Chairman Zahid Aslam in his address of welcome explained in detail the problem being confronted by the exporters. Later, Faisalabad Industrial Estate Development and Management Company Chairman Mian Muhammad Latif presented a shield to the chairman.

http://brecorder.com/index.php?id=538431&currPageNo=1&query=&search=&term=&supDate=

 

[Neo]

US to give Pakistan $750 mln for tribal areas uplift

ISLAMABAD: March 15, 2007: The United States is to give Pakistan 750 million dollars over five years to develop its troubled tribal areas bordering Afghanistan, a senior US official said on Thursday.

US Assistant Secretary of State for South and Central Asian Affairs Richard Boucher announced the funding after holding talks with President Pervez Musharraf, a lynchpin in the US-led "war on terror".

"I am pleased to announce I was able to confirm to the government of Pakistan that we will be providing 750 million dollars over five years to support the tribal area development strategy," Boucher told reporters.

"This commitment to the development of Pakistan, this commitment to the long-term relationship, is another example of the very broad and deep relationship we have," he added.

The administration of US President George W. Bush will seek the approval of Congress for the aid, Boucher said.

"This is a good plan, a comprehensive plan to provide economic development, education and other opportunities to the people who live in the border regions of Pakistan, the tribal areas in particular," he added.

The Pentagon was also asking the US Congress for 75 million dollars to upgrade the Frontier Corps, Pakistan's paramilitary border force that has borne the brunt of the fight against militants, he said.

Islamabad launched military operations in 2003 to clear the tribal areas of hundreds of Al Qaeda and Taliban militants who fled Afghanistan after the fall of the Taliban regime in late 2001.

But after the deaths of hundreds of soldiers and around 1,000 militants it signed peace deals with tribal elders and militants in Waziristan. US officials in Afghanistan say attacks on foreign forces have since increased.

US Vice President Dick Cheney paid a surprise visit to Musharraf last month during which he urged him to crack down on militant safe-havens in the tribal areas, saying that the Taliban and Al Qaeda were regrouping there.

Boucher however defended Musharraf's performance.

"President Musharraf has been a very strong ally, Pakistan has been a very strong ally... we work closely with President Musharraf and the Pakistan government because we have common interest," he said.

The US official, who arrived in Islamabad on Wednesday from Kabul, was cooler on Pakistan's plans to fence part of the border with Afghanistan to stop the movement of militants. Afghan officials have rejected the move.

"Militarily, fencing may have a role, that is something that is best worked out in a common discussion. We hope that discussions will take place -- we can help with that," Boucher said.

http://brecorder.com

 

[Neo]

120MW gas-fired power plant to be set up in Sukkur

ISLAMABAD (March 15 2007): The Petroleum Exploration (Pvt) Limited (PEL) and Frontier Holdings Limited, a Canadian exploration and production company, will invest $120 million for setting-up a 120 MW gas-fired power plant at Sukkur. The joint venture will use low BTU gas from its Kandra gas field, having as low as 140 to 200 BTU gas for power generation.

PEL and its joint venture partners - Frontier Holdings Limited and Government Holdings (Pvt) Limited (GHPL) - have signed an agreement to develop Kandra field and gas produced from it will be used for power generation to help the government overcome electricity shortage.

Kandra gas field has 140 to 200 BTU gas, and the joint venture will apply very scientific process for improvement of gas value. The joint venture will bring into Pakistan state of the art technology and equipment for its power generation project.

Its gas-fired project will be the first ever in Pakistan's history, which will consume low BTU gas for power generation. It's the government policy to encourage low BTU gas for power generation.

Since Pakistan is facing power shortage due to fast growing economy and demand of electricity the government is using all possible options for power generation. The gas-fired project is one of its options.

The Economic Co-ordination Committee (ECC) of the federal cabinet has already allocated five million cubic feet high BTU gas for co-mingling with Kandra gas to be used for power generation. The joint venture will use modern technology for improvement of gas from 140 to 300 BTU to make it useful for power generation. The joint venture is actively engaged in development of its development of Kandra gas field.

http://brecorder.com/index.php?id=538435&currPageNo=1&query=&search=&term=&supDate=

 

[Neo]

Kanupp loses generation capacity

By Khalid Mustafa

ISLAMABAD: Karachi Nuclear Power Plant (Kanupp-1), the nation’s first nuclear power unit installed in 1970 to provide electricity to Karachi, has alarmingly lost its generating capacity from an original 137 megawatt to only 40 megawatt now, as the authorities concerned have failed to maintain it over the years.

According to a senior official, the Kanupp-1 was installed with the generating capacity of 137 MW of electricity, but the plant is now left with a capacity to generate only 40 MW, which is ample evidence of the authorities’ incompetence.

The government is also planning to install Karachi Nuclear Power Plant-2 (Kanupp-2) with a generation capacity of 600 MW with the help of China. Negotiations are under way for the purpose.

“Karachi Nuclear Power Plant-1 will be retired by 2019 and the dismantling of the plant, keeping in view the nuclear emissions factor, will be a test case of the ability and capacity of Pakistan’s Nuclear Regulatory Authority,” the official remarked.

The official said the authorities concerned are trying to increase its generation capacity to the extent possible and within days it could be able to enhance its generation capacity to inject more power in the city’s system, which is facing electricity deficit.

It is strange as to why the authorities concerned have wasted too much time in enhancing the generation capacity of the nuclear power plant, which has actually been reduced from 137 MW to 40 MW.

However, at long last, the authorities concerned have made a plan to attain the generation capacity up to 70 to 80 MW as it is not possible to retrieve the total generation capacity lost because many of the parts being used in the plant have become outdated. In this connection, the authorities are in talks with the Canadian government for importing some key parts of the plant.

http://www.thenews.com.pk/daily_detail.asp?id=46851

 

[Neo]

More investment expected in telecom

By Imran Ayub

KARACHI: Orascom Telecom, parent company of the largest cellular service provider Mobilink, is likely to inject another $291 million to renew its licence for the next 15 years when it expires in July 2007.

A top official confirmed the company’s plans pinning hopes on growing cellular subscriber base in the country with expansion in coverage areas.

“Obviously, we have plans to renew licence and the decision in this regard has been made,” Zohair A Khaliq, President and CEO Mobilink told The News in a brief response. “We are very much committed to the Pakistani industry and looking forward to strengthen our operations across the country.”

Meanwhile, sources in the industry and Pakistan Telecommunication Authority (PTA) with disclosure of such plans said Mobilink would be the second cellular company, which is poised to renew its licence.

“Before that only Instaphone renewed its licence in 2005 at $291 million,” said a source. “The PTA in 2004 awarded two cellular licences to foreign companies (Telenor and Warid) at $291 million each in an open bidding, which was set as a benchmark for cellular licence fee and incorporated in the Cellular Mobile Policy 2003.”

He said as per the Cellular Mobile Policy 2003 each company had to pay the sum equal to the highest bid of $291 million at the time of its licence renewal. However, the Mobilink chief said his company would invest with conditions agreed with the telecom authorities.

“There is a huge potential in Pakistani cellular market,” he said. “We have already half a billion dollar investment plans and determined to follow that in line with the conditions agreed with the government,” Khaliq said without elaborating such conditions.

Out of total six cellular operators, licences to Instaphone, Paktel and Mobilink were awarded free of any charge when they launched their services in 90s. The PTA billed a nominal Rs50 million to Ufone for the issuance licence to operate till 2015. Paktel, however, acquired licence for GSM (global system for mobile communications) operations in 2004 at $291 million.

Huge injection of investment by cellular companies through licence fee has lifted authorities’ hopes, which expects the telecom sector continue to more than a billion dollar next fiscal mostly by wireless local loop (WLL) operators and cellular companies.

“The figures may even go up from $1 billion by June 2008,” said a PTA official. “It includes both local and foreign investment. The major chunk of the amount is expected in WLL and cellular segments.”

Quality conscious cellular companies have already in a new kind but stiff competition, which makes the country to win around $2 billion dollars investment pledges during 2006-07 for their network expansion.

Four major GSM operators - Mobilink, Ufone, Warid and Telenor - service operators with foreign stakes and management controls have chalked out their plans for network expansion, which would help these companies to increase subscriber base with.

“The cellular companies are likely to grow for the next few years, which demands investment to improve quality service,” said Anwaar Ahmed Khan, Head of Research at Inter Securities Management Ltd.

“In fact reduced tariff and increased number of destination has made the cellular service within the reach of low income group and that’s why it is rising with such staggering pace.”

http://www.thenews.com.pk/daily_detail.asp?id=46854

 

[Neo]

Foreign debt at 56 per cent of GDP

By Aftab Maken

RAWALPINDI: The government’s strict legislation for financial discipline has brought foreign debt down by 2.5 per cent per annum and would not exceed 60 per cent of GDP, said Dr Ashfaq Hassan Khan, Adviser to Prime Minister.

Addressing a seminar on “Emerging Challenges in Pakistan Banking and its Effects on Economy and Role in National Building” organised by Institute of Banking in Pakistan (IBP) at State Bank building, he said that at present the foreign debt is 56 per cent of GDP and it would be brought down to 53.5 per cent by the end of this year.

He said that government would not give guarantee for any private or public sector direct borrowing, which would be more than 2 per cent. Parliament also instructed the government to make sure the allocation of 4.5 per cent of GDP for social sector spending.

In the past, only upper and industrial class was using bank finance while introduction of consumer finance by this government in 2002, middle class and lower income groups have also go benefited, he said.

Dr Khan said that at the time when this unique idea was floated people criticised it and termed it a flop one. But, he added that time has proved that this sector has flourished and helped in eradication of unemployment and poverty besides improved living standard of people.

He said that in East Asia 67 per cent of economy lies on consumer financing while in US it is more than 75 per cent. He said that banks provided financing to consumers for purchase of automobile, electronics and electric appliances, which has helped to boost local industry and enhanced economic activities.

“Sixty per cent parts of car are being manufactured locally when production of cars increased from 30,000 units to 200,000 units per annum, it need more units and working hands,” he added.

http://www.thenews.com.pk/daily_detail.asp?id=46862

 

[Neo]

March 15, 2007
Pakistan set to harvest 22m tons of wheat

By Sabihuddin Ghausi

KARACHI, March 14: Amid an indicated shortfall of five to seven per cent in the global wheat production this year that also includes an expected deficit of three to five million tons in the neighbouring India, the growers in Pakistan are all set to harvest a record bumper crop of about 22 million tons, creating good export prospects.

“Rains have so far not done any substantial damage to the wheat crop’’, Sufi Bilal, a senior leader of the millers, informed from Lahore by telephone on Wednesday, but warned that more rains could affect the crop by reducing the size of the grain.

He indicated good prospects of wheat exports from Pakistan in the coming months as reports suggest some shortfall in wheat production in Australia, Canada and India.

In India, he said the indications are that wheat production this season will be less than 70 million tons as against its demand of 73 million tons plus. Bilal is not happy with wheat export these days as international prices have crashed from a peak a few months ago.

Traders in Karachi are too exploring wheat export prospects in India and other countries, but millers want government to come out with a comprehensive policy for wheat and bakery products export that should give incentives to value-added products.

“November and December are appropriate months for export, if silos are constructed in Sindh and Punjab according to international standards to stock wheat, and if State Bank gives a proper credit policy to finance,’’ said a local trader.

For bakery products export, the government needed to carry out a market survey in UAE, Saudi Arabia and African countries.

Reports emerging from Islamabad suggest that the federal government intends to come out with a long-term wheat export policy in anticipation of a bumper crop harvest for the second consecutive season this year.

Pakistan’s domestic demand is estimated at around 20 million tons. A strategic reserve stock of one million ton that is disposable through export at the end of any season is being considered a safe option if prospects of next crop remain bright.

But with improper mechanism of crop estimation, insufficient stocking arrangements, bad roads to connect fields with markets and above-all a high cost of production, a long-term wheat export policy will always remain an elusive dream.

“The wheat is a sensitive item, and its scarcity is fraught with frightening consequences of political destablisation,’’ remarked a bureaucrat who once remained associated with the food department in Sindh government. The memories of hunger marches, protest rallies and countrywide agitations in 1997 because of wheat flour price spiral, still haunt bureaucrats. Then a few years later, the government exported some wheat in anticipation of harvesting a bumper crop and faced an acute supply and high price problem.

In the current season, the government expects to harvest 16 to 17 million tons in Punjab, 2.3 to 2.4 million tons in Sindh and two to three million tons are likely to be procured from NWFP, Azad Jammu and Kashmir and Balochistan. The Sindh is planning to procure about 0.7 million tons from growers in next few weeks.

“We are seeking a Rs7.5 billion financing from banks to launch our procurement in the next one or two seeks’’, said an official of the Sindh food department.

The banks are now asking for 10.50 per cent interest on borrowings as against 10.25 per cent in the last quarter. The Sindh food department claims to have paid back a substantial amount of Rs7 billion borrowed for procurement in the last season and officials say that hardly Rs30 million remain to be paid back.

Millers in the city complain that wheat being made available from government stocks is of inferior quality. The government storage is of substandard quality and unable to preserve the grains.

The wheat flour price did rise in the market because of what was said rising cost of electricity, but wheat price in the open market is gradually coming down.

http://www.dawn.com/2007/03/15/ebr1.htm