Pakistan Economy - News & Updates - Archive

[Neo]

March 20, 2007
Core inflation down to 5.4pc

By Mubarak Zeb Khan

ISLAMABAD, March 19: The core inflation — non-food non-energy — has declined to 5.4 per cent in February 2007 from 8.2 per cent during the same month of the last year owing to tight monetary policy of the State Bank of Pakistan (SBP).

This sharp reduction in core inflation pushed down the overall inflation, which registered a healthy decline in the month of February, 2007 as against the corresponding month of last year.

The overall inflation declined to 7.4 per cent in February as against 8.05 per cent in the corresponding month of last year, according to the finance ministry fact-sheet issued here on Monday.

Tight monetary policy pursued by the country’s central bank is mainly responsible for secular decline in core inflation. Non-food inflation also exhibited the same declining trend – it stood at 5.6 per cent in February, 2007 as against 8.4 per cent in the same month last year.

Food inflation, on the other hand, has shown a trivial increase– it was 7.5 per cent in February, 2006 and has increased to 9.9 per cent in February, 2007.

During the first eight (July-Feb) months of the current fiscal year the average inflation stood at 8.04 per cent as compared to 8.42 per cent last year.

The non-food inflation declined to 6.47 per cent as compared to 9 per cent earlier and most importantly, core inflation averaged 5.9 per cent in the first eight months of the current fiscal as against an average of 9.1 per cent in the same period last year.

Food inflation on the other hand witnessed increase during the period. It was 10.3 per cent in the first eight months of the current fiscal as against 7.6 per cent in the same period last year.

The major contributor to the sharp pick up in food prices include the rise in the prices of pulses, milk, meat, chicken, potatoes, tomatoes, onion, beverages etc on account of imbalance in the demand and supply of these commodities.

With recent improvement in supply of these commodities their prices have started declining. With food inflation expected to decelerate and core inflation already trending downward the overall inflation target of 6.5 percent is likely to be achieved.

http://www.dawn.com/2007/03/20/ebr10.htm

 

[Neo]

Tuesday, March 20, 2007

Export target to be achieved: minister

KARACHI: The country will be able to achieve the export targets in the remaining months of the current financial year.

Although, the growth in the exports so far has remained below expectations, however, it still depicted a growth pattern compared to the last fiscal, Federal Commerce Minister Humayun Akhtar Khan stated here on Monday.

Talking to newsmen following fourth meeting of steering committee of Expo Pakistan at the Federation House, the commerce minister spoke on country’s trade sector as well about Expo Pakistan exhibition scheduled to be held by end of this month.

The ban on fish exports by the European Union (EU), he said, came due to tough guidelines concerning fisheries export. However, he said that it is a temporary ban and would come to an end as soon as the upgradation at the harbour is completed. “A three-member committee has been formed to look into the matter and suggest ways and means to end this ban,” he added.

Regarding the upcoming Expo Pakistan, the minister said that so far the response has been tremendous from the local and international sides.

http://www.dailytimes.com.pk/default.asp?page=2007\03\20\story_20-3-2007_pg5_11

 

[Janbaz]

Development of agri sector a must to keep economy moving

By our correspondent
LAHORE: The Provincial Minister for Food, Syed Hussain Jahania Gardezi, has said that development of Food & Agriculture sector is necessary to keep the economy moving. The government is concentrating on exploiting comparative advantage in exports for earning foreign exchange through diversification of agricultural production into high value crops.

The provincial minister was speaking at a workshop on ‘Management of WTO Food, Agriculture & Trade Challenges’ jointly organised by the Lahore Chamber of Commerce and Industry and Agriculture Department. LCCI Senior Vice President Yaqoob Tahir Izhar, Provincial Secretary Agriculture Fayyaz Bashir also spoke on the occasion.

The minister said that major advances in technology and the emergence of new players on the global scene underscore the need to initiate the dialogue on WTO, with reference to the standards impacting Pakistan’s trade opportunities.

He said that the developing countries, particularly those with agro-based economies like Pakistan, are facing troubles in order to cope with the challenge of conforming to the standards of developed countries to which they intend to export goods.

The News.
http://thenews.jang.com.pk/daily_detail.asp?id=47542

 

[Janbaz]

Engro Chemical among top five notable COPs in chemical sector

By our correspondent
KARACHI: United Nations Global Compact (GC) has listed Engro Chemical Pakistan Limited for providing one of the five best notable Communications on Progress (COP) in chemical sector from around the world. This has placed a Pakistani company for the first time in top five companies of the world having submitted the notable COPs with the Global Compact.

A ceremony in this regard was organised by the United Nations Global Compact Local Network Pakistan in association with Employers’ Federation of Pakistan in which Engro was presented with the shield for being among the world’s top 5 UN Global Compact Notable COPs in the Chemical Sector.

The award was presented by the Chairman of UNGC Pakistan Network Ashraf W Tabani to Tahir Jawaid, General Manager of Engro Chemical Pakistan Limited where Fasih Karim Siddiqui, Secretary, Global Compact Pakistan Local Network and Wajid Hussain Junejo, Public Affairs Manager, Engro Chemical were also present.

It may be recalled that the former Secretary-General of the United Nations, Kofi Annan had announced “The United Nations Global Compact” initiative in 1999 to bring companies together with UN agencies to support universal environmental and social principles.

The News.
http://thenews.jang.com.pk/daily_detail.asp?id=47552

 

[Janbaz]

Humayun optimistic of controlling trade deficit

R M SAQIB
KARACHI - Federal Commerce Minister Humayun Akhtar has hoped that Pakistan would regain its trade deficit of current fiscal in remaining months of FY-07. He said this while addressing a media briefing at FPCC Federation House here on Monday. He said that 74 countries over the globe would participate in Expo Pakistan 2007 exhibition.
He said that in upcoming Expo Pakistan-2007 exhibition at Karachi Expo Centre from 29th of this month, more than 800 foreigners have confirmed their arrival while a delegation from India would also participate in the exhibition. He further said that 75 per cent of stalls at exhibition have been booked so far and the target set by the ministry for sponsors have already been achieved. He said that in recent period the country have got much success in every sector of trade and industry and the economy has progressed tremendously.
While answering a query about the establishment of sugar mills in cotton growing areas of Punjab, he said that the legality of those sugar mills have been tested by the court and this depend upon farmer whether he want to grow cotton or sugar or any other crop.
He was of the view that the rate of growth in textile sector, the leading sector of country’s economy, was not as much as was expected this year. Humayun Akhtar also stated that the Trade Organization Ordinance- 2006 is now in place.
Answering to another question, he elaborated that India has stated that it has right to withdrew or review the South Asian Free Trade Agreement (SAFTA) but Pakistan want to resolve the underlined issues in implementing SAFTA on bilateral level, on which no progress has been made so far.
On the issue of banning Pakistan International Airlines (PIA)’s traffic to Europe, he said that only few planes of the national airline have been banned as they do not meet the requirements set forth by European Commission. He hoped that the administration of PIA would soon be able to meet those requirements to resume its full fledge operation in the continent.

The Nation.
http://www.nation.com.pk/daily/mar-2007/20/bnews6.php

 

[Janbaz]

Rs15.8bn for clean drinking water

CDWP approves 45 projects worth Rs49.3 billion
By Mehtab Haider

ISLAMABAD: The federal government on Tuesday approved Rs15.843 billion for Clean Drinking Water for All (CDWA) project for installing filtration plants all over Pakistan.

Both the president and prime minister have promised with the nation that the government would provide clean drinking water to all within this year and before the upcoming general elections.

The federal government also approved Rs955 million under Clean Drinking Water Initiative with revised PC-1 as the government intends to establish 409 filtration plants at Tehsils and towns in the first stage. The government wants to spread water filtration plants up to village level in the second phase.

The Central Development Working Party (CDWP), which met with Deputy Chairman Planning Commission Dr Akram Sheikh in the chair, approved 45 development projects with total revised cost of Rs82.2 billion including Sindh Water Sector Improvement by allocating Rs10.675 billion.

Net total cost of 45 projects approved in Tuesday’s meeting is Rs49.3 billion.

Prime Minister Shaukat Aziz had switched over CDWA project from Ministry of Environment to Ministry of Industries in the recent past mainly because the former failed to deliver on the ground for a variety of reasons.

“The World Bank will provide $150 million (around Rs9 billion) for Sindh water sector improvement project,” Member Infrastructure Dr Asad told reporters in a press briefing after the Central Development Working Party (CDWP) meeting held here on Tuesday.

The CDWP is authorized to approve development projects costing up to Rs500 million. The ones worth more than this amount can be forwarded by this body to the ECNEC for approval.

Flanked by Planning Commission’s Member Monitoring Gen (Retd) Mohammad Zubair and others, PC spokesman Asif Sheikh said the CDWP had approved special initiatives for industrial sector, including establishment of company for development of gems & jewellery with a total cost of Rs1.4 billion.

For development of marble granite sector, the government has allocated Rs1.976 billion.

The CDWP also approved Rs194.472 million for construction of Aiwan-e-Quaid at F-9 Park Islamabad. Some 60 to 70 gallery buildings will be constructed in it. The federal government had already purchased two acres of land for Aiwan-e-Quaid and the allocated amount will be spent for its construction only.

The meeting approved 21 projects of infrastructure sector with total cost of Rs24.4 billion including Rs9.4 billion as foreign exchange component. The government approved 13 projects of social sector having total cost of Rs46.1 billion including Rs10.8 billion in the shape of foreign exchange component.

The remaining 11 projects of various sectors were approved with allocation of Rs11.7 billion.

Out of total 45 approved projects, there are 4 projects of Punjab with total cost of Rs1.7 billion, Sindh’s 6 projects with cost of Rs11.8 billion, NWFP’s 6 projects with cost of Rs8.3 billion and Balochistan’s 7 projects with allocation of Rs4.5 billion.

There were 21 development projects spread all over Pakistan with total cost of Rs55.6 billion and one project was from the AJK government with total cost of Rs300 million.

The meeting also approved three projects for Sindh under Thar Package announced by Prime Minister Shaukat Aziz worth Rs1.1 billion.

The meeting also okayed Rs500 increase in salaries of Lady Health Workers which was already announced by the premier. It would cost the public purse Rs5 billion.

The meeting also directed the Ministry of Health for tabling new project before the body for continuation of Lady Health Workers Programme in the country.

For physical planning and housing, the meeting approved Rs102 million for construction of a complex for National Highway and Motorway Police at Rahim Yar Khan and Rs452 million for construction of Petroleum House in Islamabad. The CDWP also okayed Rs119.567 million for creative works for national monument museum.

The News.
http://thenews.jang.com.pk/daily_detail.asp?id=47661

 

[Owais]

Balochistan to have second seaport in Sonmiani: Musharraf inaugurates Gwadar Port
GWADAR (March 21 2007): Pakistan's third modern port at Gwadar started operation after its formal inauguration by President Pervez Musharraf at an impressive ceremony here on Tuesday. The port operation commenced with the unloading of cargo from three ships, which had anchored earlier.

Addressing a big gathering, attended by people of the area, the President termed the opening of Gwadar Port an historic event. He announced that Balochistan would have its second port, and fourth of Pakistan, at Sonmiani, about 100 km from Karachi, and its foundation stone would be laid this year.

Declaring that the present government "is committed to the development of Balochistan", President Musharraf said that Gwadar would be made an industrial hub, a centre for container handling, and an energy corridor. He pointed out that development projects, costing Rs 130 billion, "are being implemented in Balochistan at present". The President told the gathering that six months back the area was almost a desert and it was the present government, which embarked upon its development.

First of all, he said, the work started with the construction of Coastal Highway at a cost of Rs 12-13 billion, "as roads bring prosperity wherever constructed". He said that fish, which used to go waste, "is now being marketed" in Karachi, fetching higher price because of this vital road link, "and the people of the area are now growing prosperous".

General Musharraf said that Gwadar Port was envisioned so that there would be development and prosperity in Gwadar and, resultantly, the entire Balochistan. He announced that the Coastal Highway would now be further extended to link Gwadar with Central Asia, China, Iran and Turkmenistan, and this area would prove to be a trade corridor, and importance of Gwadar would increase further in coming years.

Assuring that there would be more prosperity here in the coming days, the President told the area people to have confidence in him, and his government, "which is committed for your welfare".

He lauded the commendable role of China in the construction of Gwadar Port and said that now Singapore Port Authority would run its operation which would help enhance its significance in the region as well as in the world.

He said that the present government is endeavouring for the development of Balochistan and its every district has been provided Rs 100 million for development schemes in respective areas. "Besides, every Tehsil has been given Rs 10 million for the same purpose".

The President announced that a 'Marine College' would be built in Gwadar, and its cost would be shared by Balochistan and Federal governments. The President also announced Rs 10 million for education, health and sewerage schemes in Gwadar.

He said that the government has development plans for rural areas of the province as well and announced Rs 50 million for the purpose. He said a Fishermen Colony would be provided in Gwadar, and asked the Balochistan Governor and Chief Minister to execute this scheme. Besides, he announced a fishermen's training centre in Gwadar where modern fishing methods would be taught.

The President declared that Balochistan's destiny "is linked with Pakistan, and the two are inseparable". Balochistan, he said, suffered from backwardness and poverty for long, and no one in the past 50 years thought of its development.

"Our government considered development of this province six years ago, and we planned the communication system, roads, rail and airport", he said, and added that "our government gave strategic Coastal Highway, and now the 950 km Gwadar-Turbat-Khuzdar-Ratodero highway is being constructed and will be completed in two-and-a-half years, after which Gwadar will be connected with entire Pakistan".

He said that yet another important road link, from Gwadar to Kohlu, would also be provided, while a new airport would be constructed in Gwadar. He referred to a study initiated on Gwadar to Dalbandin and Qandhar railway line and thus, he said, a network of communication system would be laid in the province, which would come on the ground in the next 5-6 years.

General Musharraf said that irrigation system was also being streamlined. Mirani dam has already been constructed, which will bring 35,000 acres land under irrigation, while Subakzai dam was also ready and he would perform its inauguration in a few months, while Katchi Canal is being constructed which will bring 0.7 million acres land under cultivation.

He said that watercourses in the province are being lined, for which, Rs 5 billion has been allocated. This scheme would take 2 years to complete. The President said that electricity and gas would be supplied to villages of Balochistan and gas line was being taken from Zarghoon to Quetta.

He said there are some elements who speak against Punjab, but they should know that the government and the people of Punjab advocate investment and development in Balochistan.
http://brecorder.com/index.php?id=541099&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

PNSC enters Indian freight market after 30 years

KARACHI (March 21 2007): After an interval of over 30 years, under the amended shipping protocol between Pakistan and India, Pakistan's national flag carrier Pakistan National Shipping Corporation (PNSC) has delivered liquid and general cargoes at two Indian ports.

Sources told Business Recorder on Tuesday that oil tanker MT Lalazar recently delivered 92,000 tons crude oil at new Mangalore, while consignments of general cargoes were delivered at Gujarat's Bedi port by MV Bolan and MV Chitral.

They said that the Corporation had competed in an open international bidding for the one-time crude oil transportation contract offered by state-owned Indian Oil Company from Iranian port of Kharj Island to New Mangalore port for Mangalore Refinery.

The Corporation was among four to six competitors, mostly Greek shipping companies, for the crude oil contract, source said, adding that PNSC has expanded its wings to the Indian freight market, especially for potential oil transportation segment for the neighbour country.

They said that the Corporation also successfully acquired another one-time contract, to be delivered on March 26, from United Arab Emirates Abu Dhabi port to Tamil Nadu's Chennai (Madras) port.

http://brecorder.com/index.php?id=541136&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

Textile export crosses $7 billion mark

KARACHI (March 21 2007): Country's textile export witnessed a straight jump of 6 percent during the first eight months of the current fiscal year 2006-07, as it crossed the $7 billion mark, official statistics revealed on Tuesday.

According to statistics, Pakistan's textile exports have been increased by 6 percent during the first eight months (July-February) of the current fiscal year, as compared to the same period of the last fiscal year.

Textile export stood at $7 billion during July-February of the current fiscal year as compared to $6.609 billion exports during the same period of the last fiscal year, depicting an increase of $397 million. Month-on-month basis, country textile exports have risen by 6.23 percent during the February 2007, against the same period of last fiscal year.

Statistics shows that during the month of February 2007, country's textile exports stood at $788.561 million as compared to $742.048 million during the same period of the last fiscal year 2006, indicating an increase of $46.513 million or 6.23 percent during February 2007.

In February 2007, textile export also showed an increase of $24.392 million or 3.19 percent against the January 2007 during which country's textile exports were recorded $764.169 million.

Four textile items including raw cotton, cotton cloth, cotton carded and bed wear exports have decline during July-February 2007, while other products' exports including readymade garments, yarn, knitwear, art and silk shows raised. During July-February of the current fiscal year, knitwear moved up by 16 percent, yarn by 140.46 percent, and towels by 2 percent.

Similarly, exports of tents increased by 167 percent, readymade garments by 8 percent, art and silk by 164 percent, yarn other than cotton yarn by 153 percent, made-up articles by 3 percent, whereas exports of other textile sectors registered 26 percent growth. Raw cotton exports have declined by 18 percents, cotton cloth by 9 percent, cotton-carded exports showed a decline of 56 percent, bed wear by 5 percent.

"Despite 6 percent growth in textile export during the first eight months of the current fiscal year, we will not achieve textile export target of $10.15 billion," said Zubair Motowala, a leading exporter. He said that major increase has recorded in the exports of textile raw materials, not in the finished products.

He said that post quota regime and international competition have put a negative impact on the country's textile export, resulted a decrease of 1.12 percent during the first five months July-November of the current fiscal year 2007.
http://brecorder.com/index.php?id=541088&currPageNo=1&query=&search=&term=&supDate=

 

[Owais]

Over 0.1 million workers sent to UAE during 2006

ISLAMABAD (March 21 2007): Pakistan has sent more than 0.1 million workers to the United Arab Emirates (UAE) during 2006 alone after it early last year signed with the Gulf state a Memorandum of Understanding (MoU) for manpower export, a top official says.

"The agreement we (government) has singed with the UAE authorities has produced desired results. Around 100 thousands workers have flied to the state in 2006 and many more will be going this year," State Minister for Overseas Pakistanis Raza Hayat Hiraj told a Senate committee.

The Senate Standing Committee on Labour, Manpower and Overseas Pakistanis met here on Tuesday to review manpower export and human trafficking from Pakistan. The meeting Presided over by Senator Naeem Hussain Chattaha,

Raza Hayat told members Democratic Peoples Republic of Korea had for the first time in the history included Pakistan in the source countries for importing skilled and unskilled workers. He claimed that his ministry was pursuing a dynamic strategy for increasing manpower export from Pakistan.

Hayat, however, could not defend his ministry for what it was doing to secure favourable or at least reasonable working conditions and salaries for Pakistani workers abroad especially in some of Gulf States.

A few members alleged that employers in these countries exploit poor workers they hired from Sub-Continent. Most of the time, members blamed, they backtracked from their commitment and did not offer what was claimed at the time of hiring. Senators said they had received complaints of inhuman treatment by employers in Dubai and other UAE states.

Raza seemed to have no answer for these reservations. At times, he appeared agree with what members blamed. The minister, however, could not come out with a firm commitment to raise these issues with UAE authorities.

He also informed the committee the investment promotion conference organised by the ministry last year was highly successful as overseas Pakistanis from 35 countries attended and helped to formulate the recommendations.

The committee directed the ministry to redouble its efforts for increasing export of manpower from Pakistan and by taking tangible steps for improving the skill levels of workers with a view to enhance their competitiveness in the international markets.

The committee also called for stringent measures to curb human trafficking by improving inter-ministerial co-ordination and creating greater public awareness on the issue. Some members of the committee demanded a complete ban on special Hajj passports, alleging that the facility was being misused grossly by corrupt persons.

The committee also directed the FIA to publish a complete list of human smugglers arrested/prosecuted since 2002 along with their names and addresses so that the general public might be more careful in dealing with them in future.
http://brecorder.com/index.php?id=541210&currPageNo=1&query=&search=&term=&supDate=

 

[Neo]

March 21, 2007
IFC to offer $1bn loan for private sector

By Ihtashamul Haque

ISLAMABAD, March 20: The International Finance Corporation (IFC) plans to offer $1 billion new lending to Pakistan's private sector to further promote its telecommunications sector and help meet the growing energy requirements of the country.

Informed sources told Dawn on Tuesday that the IFC, a member of the World Bank Group, has also identified tourism, health and infrastructure as new sectors which will be provided increased lending during 2007 and onward.

The corporation would increase the current level of its assistance from $400 million to $1 billion, beside helping attract Foreign Direct Investment (FDI) in the country, particularly from the Middle East.

The executive vice president of IFC, Mr Lars Henrik Thunell, will arrive here on Wednesday to meet the president, the prime minister, his advisor on finance and other senior government officials to discuss the IFC's new plan to offer $1 billion lending to Pakistan's private sector.

Sources said during his meetings with senior Pakistani officials, the idea of supporting Pakistan's public-private sector business ventures will also come up for detailed discussion.

"So far, the IFC has provided loans to the private sector only, but now it can consider funding public-private joint ventures as well," said a source, adding the IFC was very much interested to enlarge its operations in Pakistan.It has, so far, offered $2 billion to the country's private sector.

Pakistan, he said, was a capital-constrained country, which needed to be extensively supported in the coming years.

The track record of Pakistan's private sector was very good in terms of timely paying back its loans to the IFC due to which it was decided to offer sizable new loaning to investors.

It was also learnt that the first-ever "mediation centre", being supported by the IFC is expected to be fully functional soon in Karachi to provide an effective and institutionalised dispute resolution mechanism to investors.

Initially, the centre being funded both financially and technically by the World Bank's private sector arm -- IFC, will focus on commercial cases and its activities will be limited to Karachi only as being the pilot project. But later it will be stretched to other cities as well.

The centre is being set up with the help of London-based "centre for effective dispute resolution" which is providing technical expertise to have a set of trained mediators in Pakistan for resolving disputes.

According to IFC officials, the centre would offer international standard mediation through a group of trained experts. This would be a real alternate dispute resolution forum which would facilitate the concerned parties and investors to sit down and settle their disputes without seeking the indulgence of courts.

"It is not an arbitration, but a mediation to encourage the investors to settle disputes peacefully and amicably", a source said.

The centre, he said, would work as a "neutral party" whose findings cannot be discussed or used as reference in the courts.

All the process will be conducted voluntarily, but if both sides are not convinced and do not reach any dispute-resolution mechanism, they can go back to litigation. "But both sides will be bound not to disclose the proceedings of the mediation in any court," he clarified.

This was how it was expected that the backlog of thousands of cases could be cleared. The IFC has provided $1 million for the training of judges and improving the processes of the courts.

The IFC's assistance to South Asian clients expanded this year to help expand capacity and develop new products and services. Infrastructure development where progress is critical to economic growth and quality of life is another focus of IFC's investment strategy, particularly in Pakistan, sources said.

"Our focus is key business lines where we have a competitive advantage," says a latest IFC document.

"We improve our standards for social and environmental performance of our investments and new policy to disclose more information and activities," it said.

This year, the IFC introduced, a new development outcome tracking system for investment operations to measure and track results throughout the life of a project.

http://www.dawn.com/2007/03/21/ebr12.htm

 

[Neo]

Mixed economic trends

THE government believes that an estimated bumper crop of 22 million tons of wheat, a better than expected rise in informal livestock production and the expansion of the services sector would push up the narrow-based economic growth above the targeted 7.1 per cent this year. While missing out on some of the key macro-economic targets and suffering from chronic structural imbalances, the economy seems to be growing faster than the expectations of the policymakers and official forecasts. However, the economy’s performance cannot be assessed based on the GDP criteria alone, when some vital but negative economic trends are becoming more pronounced while social indicators are not strong enough to make the growth socially sustainable. The official estimate that agricultural growth would touch five per cent against this year’s target of 4.5 per cent has to be seen against the background of the weak performance of three major crops — cotton, rice and maize — which overshadowed the impact of a rise in sugar production. The size of crops fluctuates from year to year and differs widely from initial to final estimates. An accurate assessment of livestock production is not so simple because much of it is in the informal sector.

In its first quarter report 2007, the State Bank recognised the “challenges” facing industry and agriculture, adding that “the achievement of the annual growth target will require the service sector to turn above the target growth rate.” The report was based on the lacklustre performance of kharif crops and a slower increase in the Industrial Production Index at 7.6 per cent against 7.9 per cent in the same period last year. The State Bank also questioned the official data on a supposedly big jump in textile (sub-group) output when its export growth had slumped. Textiles, the largest industrial segment that contributes the bulk of export earnings, is in distress and looking for an official bailout. Its bank credit offtake is much less than originally estimated. The overall exports are currently growing at 3.89 per cent against the targeted 18 per cent. This indicates the sluggish rise in export-oriented production. In the first quarter, the growth in automobiles, fuelled by domestic demand, slumped to 11.1 per cent against 33.1 per cent during the comparable period last year. Corporate profits are on the decline. The growth in wholesale and retail trade is now estimated at 7.2 per cent against the original target of 8.8 per cent. Sectoral imbalances are also mounting. In the first quarter of 2007, the consumer goods industries grew at 13.1 per cent as compared to 9.5 per cent in the same period last year; and the capital goods output registered a much lower growth of 9.6 per cent, down from 30.1 per cent — a single digit growth for the first time since 2004.

Though buoyant, the external sector is far from robust. With the worsening trade and current account deficits, the risks to the economy are mounting. Inflation is affecting export competitiveness. The trade deficit touched a record $8.9 billion during July-February 2007 and the current account deficit is expected to reach $8.8 billion — up from the $6.3 billion target. The model of economic growth being pursued is widening the gap between the rich and the poor, with food inflation of 10.33 per cent eating into the purchasing power of the vulnerable. It is time to focus on social indicators, poverty alleviation, food security and on correcting economic imbalances. Without equity, GDP growth alone, though important, is not enough.

http://www.dawn.com/2007/03/21/ed.htm#1

 

[Neo]

Wednesday, March 21, 2007

CDWP okays 45 uplift projects worth Rs 82.2b

By Sajid Chaudhry

ISLAMABAD: The Central Development Working Party (CDWP) on Tuesday approved 45 development projects worth Rs 82.2 billion including the Rs 10.675 billion Sindh water sector improvement project and Rs 197 million for establishment of a 132 KV grid station and a electric transmission line for the New Islamabad International Airport.

The meeting also approved Rs 15.843 billion for Clean Drinking Water for all Project and Rs 955.1 million for Clean Drinking Water Initiative Project (second revised PC-1 for 409 plants in tehsils and towns).

Asif Sheikh, spokesman for the Planning and Development Division in a media briefing told reporters that the CDWP met under the chairmanship of the Dr. Akram Sheikh, Deputy Chairman Planning Commission and discussed 55 projects and approved 45 projects included in the agenda. Ten projects were deferred due to the non-availability of complete documents and concerned officials in the meeting.

He said 21 projects worth Rs 24.4 billion for infrastructure development, 13 projects worth Rs 46.1 billion for social sector and 11 projects worth Rs.11.7 billion for information and broadcasting, science and technology and industries have been approved. On area-wise projects and their allocations, he informed that four projects worth Rs 1.7 billion for Punjab, six projects worth Rs 11.8 billion for Sindh, six projects of Rs 8.3 billion for NWFP, seven projects worth Rs 4.5 billion to Balochistan, one project worth Rs 300 million for AJ&K and some 21 projects worth Rs 55.6 billion located all over the country were approved.

The important projects in the transport and communication include construction of fish landing jetty and allied harbor facilities at Surbandar East Bay Gwadar worth Rs 672.674 million, construction of fish landing jetty and allied harbor facilities at West Bay Gwadar Pishukan worth Rs 628.570 million.

In the water sector, the CDWP approved World Bank funded Rs 10.675 billion Sindh water sector improvement project. The meeting also approved Rs 1.4 billion for creation of Gems and Jewellery Development Company, Rs 280 million for Ceramics Development Centre and Training Center and Rs two billion for Marble Granite Development Company. Under Pakistan Industrial development Company (PIDC). He said that the meeting has allocated Rs 194 billion for establishment of Aiwan-e-Quaid at F/9 part area on 40,000 square feet area. After completion, it would be managed by Nazrea-e-Pakistan Council.

The CDWP revived the existing lady health workers (LHW) programme with an addition of Rs five billion, because of an increase in the salaries of lady workers from 1800 to 2300 per month. The existing programme will end in 2008 with the number of workers at around 96,000 in the country.

The meeting asked the authorities concerned to prepare a new LHW programme to improve further the reproductive health facilities in the country. The meeting has allocated Rs 452 million for the construction of “Petroleum House” at Islamabad so that all the offices of petroleum ministry could be shifted to new office.

Five projects for information and broadcasting were approved in the meeting with an allocation of Rs 1.905 billion, which include LED (Light Emitting Diod) Mobile screen system, 1000 KW MW transmitting section for Lahore, 1000 KWMW transmitting section for Umerkot, replacement plan of MW transmitters phase-1 and electronic news gathering.

Member Infrastructure, Planning and Development Division informed the media that a high-power delegation from World Bank has visited Pakistan and discussed long-term water needs of the country including construction of dams.

The issues which were discussed with the WB delegation were improvement in water usage efficiency, improvement in ground water levels, increase in water storage capacity, institutions strengthening and an over all assessment of increase in population as well as decrease in availability of water. This delegation also visited Basha Diamer Dam site.

On completion of their visit, the WB delegation discussed with Pakistani officials the initial findings of their visit and now they would prepare a detailed report on Pakistan to help develop water sector. He clarified that WB delegation had nothing to do with funding of these dams, nor they denied such funding.

http://www.dailytimes.com.pk/default.asp?page=2007\03\21\story_21-3-2007_pg5_1

 

[Neo]

Kuwait Fund Provides $37.5 Million Loan For Pakistan Power Project

ISLAMABAD -(Dow Jones)- The Pakistani government signed a $37.5 million loan agreement Wednesday with Kuwait Fund for Arab Economic Development for building a hydropower project in the north of the country.

The 106-megawatt Golen Gol Hydroelectric Power Project will help meet growing demand for electricity in the North-West Frontier Province.

Construction of the PKR7.2 billion ($117 million) project, which comprises three hydroelectric generation units, will start this year and is expected to be completed by the end of 2011.

The loan is for a 25-year period with a 6-year grace period. Interest is repayable semiannually at a rate of 2.5% per annum.

The project will also be financed by other foreign loans and government funding.

Kuwaiti Fund for Arab Economic Development, which extends loans and aid to Arab and other developing countries, has provided Pakistan with KWD84 million ($ 286 million) in 13 loans for financing of various sectors.

http://www.nasdaq.com/aspxcontent/N...CQDJON200703210532DOWJONESDJONLINE000423.htm&

 

[Janbaz]

Pak exports only 2pc of world textile sector'

HAQ NAWAZ
ISLAMABAD - Coming down hard on the government’s blue-eyed textile sector, the Consultant and Economist of Planning Commission, Dr Aqdas Ali Kazmi, was not ready to accept the notion that the cotton was the main pillar of the national economy but actually it was driving the economy down.
Dr Kazmi expressed these views here on Tuesday while speaking on the textile sector and key policy issues in connection with a dialogue on “The Elimination of Textile Quotas and Pakistan-EU trade.” Social Policy and Development Centre (SPDC) has organized the dialogue to discuss in detail the European Union funded study.
In support of his point, Dr Aqdas argued that it was highlighted of having 65 per cent share of textile goods in the overall country’s exports but when this share was compared in global scenario, Pakistan’s textile share is only 2 per cent in the $500 billion world textile exports. “This shows a poor picture and the textile sector should look into this area,” he added.
He was of the view that textile sector is actually undermining the national economy of Pakistan. “Pakistan’s Gross Domestic Production (GDP) growth is cradled by the cotton sector,” he kept on bashing this sector considered as the sole pillar of the economy.
However, he suggested the private sector to invest more in the research and development areas, improve the state of technology by replacing the oldest one and concentrate on skills development to enable this sector more competitive internationally.
Speaking on the occasion, Thorsten Bargfrede, First Secretary in European Union (EU), delegation of the European Commission to Pakistan, assured that EU would continue providing assistance to Pakistan for strengthening the trade sector to meet the challenges in the post-quota regime.
“Talking politically, EU has been given preferential market access with major tariff concessions to Pakistani goods since 2001.
However, commenting cautiously on Pakistan’s repeated requests to extend trade facilities to its goods under the Generalized System of Preference (GSP) plus, he stated.
that Pakistan did not qualify for this scheme, meant for the Least Development Countries (LDCs).
Earlier in her opening remarks, Managing Director, SPDC, Dr Khalida Ghaus, remarked the researchers for completing such a timely study on a subject needed more exploration.
She urged for a full-fledged policy dialogue on the issue of impact of elimination of quantitative restrictions on textile sector.
“Desires are there at the top government level to take extra measures for the textile sector but these measures are not translated into actions,” Dr Khalida pointed out.
Presenting the main features of the study, one of the researchers and senior economists in SPDC, Iffat Ara, said that the study was aimed at initiating a policy dialogue on this important subject of post-quota regime and implications on Pakistan’s textile sector.

The Nation.
http://www.nation.com.pk/daily/mar-2007/21/bnews5.php