Pakistan Economy - News & Updates - Archive

[Neo]

FPCCI, TDAP discuss Pak-China trade statistics ​

Thursday, November 29, 2007

KARACHI: In view of Pak-China FTA, signed in July 2007, a preliminary report in the form of a quantitative analysis was presented by the WTO Cell, TDAP, to the Pakistan China Business Council of FPCCI.

The meeting was held at the Federation House, to identify the existing and indicative export potential of Pakistani products to the huge Chinese market. Mujeeb Khan, Head WTO Cell, Trade Development Authority (TDAP), initiated the meeting by giving a brief outline about the inception of the Cell and its operations.

He said a WTO Cell has been established in TDAP to enable better communication between the public and private sector, and to assist in getting better market access for them through research and information in the light of the WTO.

Iqbal Tabish, Unit Head Information and Research, WTO Cell, TDAP, presented in detail the study on Pak-China Trade, ‘Exploring Pakistan’s Export Potential to China’, which highlighted the statistical analysis based on the recent trade data. The study, which has been conducted by the Information & Research Unit of the WTO Cell, flows from the statistical analysis using ITC tools. The objective in discussing the initial conclusions of the report with the Pak-China Business Council is; to identify irritants, non-tariff barriers, and hidden barriers, best known to businessmen trading with China. “We require such input and suggestions from all to make the study worthwhile and productive,” Tabish said.

FPCCI, TDAP discuss Pak-China trade statistics

 

[Neo]

PSEB seeks venture capital for IT firms ​

Thursday, November 29, 2007

ISLAMABAD: Pakistan Software Export Board (PSEB) is launching various initiatives to facilitate access to venture capital, strengthening the equity base of IT companies and promoting world class entrepreneurial culture in the IT industry.

The projects are aimed at raising the fast track development and robust growth of the Pakistan’s IT industry. One such Programme, the PSEB’s Entrepreneurship Project has been initiated to provide consultancy, on due diligence, to selected IT companies with the objective of qualifying them for Initial Public Offering (IPO).

Currently, out of over 1082 IT companies in Pakistan, only two companies are listed on the Karachi Stock Exchange. ‘To get more companies listed, as envisioned under the project, PSEB would subsidise its consultancy by 75 per cent while selected companies would bear the remaining 25 per cent of the consultancy fee’, a spokesman of PSEB said in a statement.

In order to facilitate access to venture capital, PSEB would facilitate entrepreneurs in getting venture capital funding through vetting business plans and establishing linkages with Angel, VC, Private Equity, Public and Multilateral funding organisations.

PSEB has also launched an Apprenticeship Programme for creating a pool of skilled resources in Pakistan’s IT industry matching the advanced and specialised international technological requirements.

Under this initiative, IT companies would recruit IT graduates on apprenticeships and later hire them for a period of at least one year. This would allow fresh graduates to follow a career path provided by the participant companies, thus strengthening the pool human capital in the country.

The spokesman also said that a multinational IT company, Bearing Point, has already expressed its willingness to recruit about 100 IT apprentices out of which 46 have already been placed.

Another major project, the IT industry Internship Programme, said the official spokesman of PSEB, intends to bridge the gap between the IT industry and academic institutions, and would help mould fresh graduates into world-class professionals. Some 3100 internees from 205 universities/institutes were placed in the local IT industry and 235 IT departments of public and private sector organisations.

PSEB seeks venture capital for IT firms

 

[Neo]

OMV to invest $80 million ​

Thursday, November 29, 2007

ISLAMABAD: Federal Minister for Petroleum and Natural Resources Ahsanullah Khan has said that the government was providing best incentives and level playing field to the investors in oil and gas exploration, said a PR.

He said this while talking to the Ausrian OMV Petroleum Company General Manager George Wacktal who called on him here on Wednesday. Wacktal informed the minister that OMV has made two more discoveries of gas at Latif and Gambit blocks in Sindh making further investment of $80 million on gas field development.

The minister said that the new petroleum envisages world standard incentives and facilities for the prospective investors which would attract investment in oil and gas exploration. He said that the government would ensure continuity of reforms and policies introduced in the oil and gas sector and would facilitate the investors in this regard.

The minister lauded the OMV’s contribution for making a sizeable investment in Pakistan’s oil and gas exploration activities which has been producing 16 per cent gas of the total production. Earlier, The OMV GM felicitated the minister on assuming the portfolio of the ministry and hoped that Pak-OMV relations would further flourish in his tenure.

OMV to invest $80 million

 

[Neo]

France urges Pakistan to increase bilateral trade​

KARACHI: Francis Widmer, Trade Commissioner of France on Wednesday said Pakistan and France enjoy good economic and trade relations and there exists a great scope of increase in bilateral trade and industrial cooperation between these two countries, however this relationship does not reflected in numbers.

He said this during a meeting with Mr. Shamim Ahmed, President. Karachi Chamber of Commerce and Industry (KCCI). He said the annual exchange of goods, which was $677.2 million in 2005-06, out of which exports were $336.7 million and imports were $340.5 million from Pakistan. French Trade Commissioner, underscored the need to diversify Pakistani exports to France since most of its foreign trade consisted of conventional items like textiles and leather goods. He said that there is a great scope for joint ventures with France and informed that a French delegation of investors and traders will soon visit Pakistan to explore such potential.

Pakistan is facing acute shortage in public transport sector and as such French investors could assist Pakistan to overcome this problem. He suggests that Pakistan might also establish warehouse and distribution centers in France for onward export to Euorpean Union (EU) and adjoining countries.

President KCCI said, France is an important member of EU which offers a huge market for Pakistani goods, and Pakistan is one of the major suppliers of textiles to EU but it is a matter of concern that its export especially textiles do not enjoy better access mainly due to the implications of anti-dumping duties on some of textile products and non –granting of GSP plus status, as given to Bangladesh etc.

Daily Times - Leading News Resource of Pakistan

 

[Neo]

Economy facing numerous challenges​

KARACHI, Nov 28: There has been a constant decline in the country’s exports for the fourth consecutive month of the current fiscal, which is alarming not only for the balance of trade alone but also indicates that some serious problem is ailing the economy as a whole.

No matter what economic wizards may say in Islamabad in their defence, and even if they suggest some sweet pill to correct the situation easily and induce economy back to the healthy position, the fact remains that in October the trade deficit bulged close to $2 billion.

Beside, the widening of balance of trade, the economy, at present, is confronted with multiple issues on the manufacturing and agriculture sectors.

If the situation is not corrected immediately, it is feared that soon the service sector, which is thriving, may also fall in line and have a snowball affect on economy as a whole.

The biggest indicator of the weakened economy could well be taken from the fact that rupee had depreciated against US dollar which, otherwise, itself is losing ground against major currencies of the world.

However, economic planners in Islamabad are not ready to accept this fact, and they continue to count gains, and say that they have achieved economic growth. This may have relevance with the recent past, but they are yet to narrate the correct current economic situation.

Total exports in October stood at $1.409 billion as against $.558 billion recorded in July 2007, thereby showing a staggering decrease of 9.5 per cent in the first four months of the current fiscal.

The textile industry, which is the largest manufacturing sector of the country and also earns up to 65 per cent in exports, is rapidly heading towards a total collapse owing to high cost of production which has rendered it uncompetitive in the world market.

There was a constant fall in textile exports during the first four month of the current fiscal. In October, these declined to $837 million as against $931 million, a decrease of 10.1 per cent against the corresponding period of last year.

Against this, imports touched $3.385 billion during October.

So far, remittances received from overseas Pakistanis and sale proceeds realised from the sale of national assets helped meet trade deficit, but the question is how long this will go on because there would be a time when trade gap would be wider, if current falling trend in exports was not arrested.

The weakening economy’s position could well be judged from the fact that the State Bank had to defend the weakened rupee last week by using $80 million out of its valuable reserves. If this trend continues, the SBP would have a tough time to defend the rupee.

On the agriculture sector, almost all the cash crops have failed to meet the target. The government’s projection of cotton production of 14.3 million cotton bales this year has been revised downward to 12.8 million bales, but private estimates put it further lower at 11 million bales.

The cotton crop was severely damaged by mealy bug and curl leave virus (CLV) and there was no one to guide growers or even make available relevant pesticide which could have controlled the damage.

Similarly, there had been wheat and rice crises, because both the major crops were badly handled by the government, and it resulted in an acute shortage and price hike in the domestic market.

The sugarcane is not having a different story and like every year, there is price war between growers and millers over the cane.

Economy facing numerous challenges -DAWN - Business; November 29, 2007

 

[Neo]

$4bn Tap gas pipeline project in jeopardy​

ISLAMABAD, Nov 28: The $4 billion Turkmenistan-Afghanistan-Pakistan (Tap) gas pipeline project is unlikely to materialise even in the next decade owing to Russian gas giant Gazprom’s fresh agreement with Turkmenistan for increased Europe-bound gas supplies at enhanced rates, it is learnt.

Gazprom would be paying about 50 per cent higher price to Turkmenistan from next year.

Informed government sources told Dawn that Pakistan was weighing the new developments in the background of a just postponed ministerial meeting of the three countries and a revised agreement between Gazprom and Ashgabat.

The revised agreement apparently means that the Central Asian state would have little surplus gas available for export to the South Asian region.

Not only that, the price could become a stumbling block because Pakistan and India may find it “unaffordable for their economies” when compared with the much prosperous European region.

The sources said Pakistan was surprised to know at the eleventh hour that Ashgabat has been holding an international energy conference on the dates that were fixed for a ministerial steering committee meeting in Islamabad on Nov 27-28.

Pakistan has planned to complete the project by 2012 under a energy security plan, but the deadline is becoming beyond imagination, an official said.

The sources said under the revised understanding with Gazprom, Turkmenistan would increase gas deliveries to it to about 50 billion cubic metre (BCM).

Gazprom that delivers about one quarter of Europe’s total gas needs would now pay $130 per 1,000 cubic metres to Ashgabat early next year and then $150 per 1,000 cubic metre by the end of the next year instead of current rates of $100 per 1,000 cubic metre.

Turkmenistan and Gazprom have a 25-year gas supply agreement valid until 2028 but Ashgabat, the sources said, uses export projects like Tap to improve its price with Gazprom.

The world’s 10th largest gas producer, Turkmenistan’s total gas output currently is slightly higher than 60 BCM a year. Last year, its total exports stood at around 45 BCM.

Since the death of former President Saparmurat Niyazov last year, the Turkmen economy is opening up for foreign investment.

His successor Gurbanguly Berdymukhammedov plans to quadruple gas output to about 250 BCM by 2030 and Ashgabat would need more than $25 billion to develop its offshore Caspian reserves.

Therefore, enough reserves are apparently not available in the immediate future for a South Asian gas pipeline, the sources said.

Already, Turkmenistan is expecting a major competition among big players like the US, Europe and China to keep Gazprom under pressure on pricing issue.

Likewise, the US and the European Union are using their influence for a pipeline that could link Turkmenistan’s yet to be developed gas fields with Europe through Turkey in what is called a southern corridor to bypass Russia.

The 1,680km Tap pipeline of 56-inch diametre needs at least 30 BCM of gas per year from Turkmenistan to Pakistan via Afghanistan.

The project cost has now been estimated at $5.3 billion. India had also been invited to join the project last year that started attending steering committee meetings as an observer.

According to the World Bank, however, “further progress will depend on the robustness of the gas reserves data, certification of the reserves, extent of possible private interest, ability and willingness of Turkmenistan to fulfil its commitments to Gazprom and still supply Pakistan”.

The ability and the willingness of Turkmenistan to feed this pipeline while fully honouring its earlier commitments to Gazprom for the European and former Soviet Union markets and the extent of possible private sector interest will also remain a challenge while the sharp increase in gas prices delivered to the European markets could make the option of exporting to South Asia less attractive to Turkmenistan and thus the export price could also become a major issue.

Challenges in the Tap project also include mitigation of the security risk in Afghanistan, improvement in India-Pakistan relations, and programmes to minimise or phase out fuel subsidies in both countries and finally the ability of the pipeline options to withstand competition from liquefied natural gas (LNG) in the long run, according to the bank.

$4bn Tap gas pipeline project in jeopardy -DAWN - Business; November 29, 2007

 

[Neo]

$100m loss in seafood exports feared​

KARACHI, Nov 28: Pakistan is feared to lose up to $100 million in its seafood exports during the current fiscal year following a ban by the EU coupled with reduced prices being offered by other countries.

Pakistan fetched $45-50 million from the seafood export to the European markets in previous years.

However, after the ban imposed by the EU in April this year exporters had been facing problems in diverting EU destined shipments to other countries because of lower prices.

According to exporters the cumulative loss both in exports to the EU and other countries during July-Nov 2007 was $50 million and it would escalate to nearly $100 million by end of the current fiscal if exports to EU countries remain suspended.

The country had fetched $188 million from seafood exports in 2006-07, including exports to European countries.

A number of meetings between the fish exporters, Minfal officials, launch owners and the Sindh government officials have been held since April 12 ban but no serious efforts were made both at the federal and provincial levels to take immediate measures for restoring exports to the EU countries.

According to President Pakistan Seafood Industries Association (PSIA) Sardar Mohammad Hanif Khan the Minfal high official came up with an idea in Tuesday meeting in Karachi to allow only two to three processing units to export shrimps and other products the EU countries.

He said he had rejected the proposal before seeking clearance from more than 11 units.

He said he had again asked the Additional Secretary Minfal Mohammad Salim Khan to first concentrate on preliminary issues like modifying boats as per the EU standards and removing deficiencies in the auction halls as pointed out by the EU.

After checking early stages, the Minfal should give 10 days notice to the processing units (exporters) for final inspection, he said.

He said Pakistan was suffering on EU exports because of the non-technical staff at the Marine Fisheries Department (MFD), who do not have the technical know-how about the fish trade and exports.

The fish industry will continue to face problems unless the setup of the MFD is changed, he added.

Mr Hanif said that there had been very slow progress on upgrading of boats and meeting the EU standards on auction halls.

He said that the Sindh government informed the Minfal that it had provided Rs290 million for purchase of various equipment for fishing boats modification.

The provincial government will also bear 50 per cent expenses on upgrading of fishing trawlers.

$100m loss in seafood exports feared -DAWN - Business; November 29, 2007

 

[ejaz007]

India agrees to cut customs duties for Pakistan

By Mubarak Zeb Khan

ISLAMABAD, Nov 28: India has agreed to scale down customs duties below the applied level for two neighbouring countries -- Pakistan and Sri Lanka -- under the South Asian Free Trade Agreement (Safta).

Well-placed sources told Dawn on Wednesday that the decision came in response to Pakistan’s protest that despite reduction in customs duties in three phases under Safta by India, the duties are still higher than the Indian normal customs duties for Pakistani products under the treaty.

India has unilaterally brought down its customs tariff to around 10 per cent during the last two years. At the time of making commitment for reduction in customs duties under the Safta agreement, the Indian duties were around maximum 15 per cent.

The sources said that the Indian delegation agreed to consider Pakistan’s proposal at the 13th meeting of the Committee on Economic Cooperation (CEC) of the South Asian Association for Regional Cooperation (Saarc), held after a lapse of three years in Dhaka last week.

The Indian government has also agreed to come up with a roadmap in December for eliminating or mitigating the non-tariff barriers, which restrict entry of goods into the Indian market.

A ministerial task force had already been constituted by the Indian government to identify these barriers and suggest measures for their redressal. The task force report is expected to be submitted to the commerce ministry in December, the sources added.

This move of India would certainly help in facilitating imports from the South Asian countries. However, if these NTBs were either removed or relaxed it would certainly help in increasing export of minerals, marble, and textile products from Pakistan.

Pakistan had already submitted a long list of the NTBs to the Indian government last year for consideration. The removal of these barriers has been linked with the liberalisation of trade with India.

According to the sources commerce secretaries from eight countries have also decided to take a common position on various issues under the Doha Round negotiations for fostering increased regional trade against the backdrop of the changing global scenario.

It was agreed that the Geneva-based ambassadors of the Saarc member states will meet to find out a common stance on the Doha Round negotiations.

During the meeting, the secretaries also decided to undertake a new project to ensure cooperation for development of the small and medium enterprises (SMEs) in the region.

It also endorsed the recommendations made by the standing group on Standards to establish a South Asian Regional Standard Organisation (Sarso), which will be located in Dhaka at the premises of Bangladesh Standard Testing Institute (BSTI).

The meeting underscored the need for exploring the potential of renewable energy and biotechnology through regional cooperation to meet the mounting demand for energy in the Saarc region. India, which has expertise in renewable energy, will undertake necessary actions in this regard.

Regarding the issuance of Safta certificate of origin, the meeting decided that all the member states would inform the Saarc secretariat about the certificates issued by each country every six months. It also decided to scale down the sensitive list to ensure benefit to the least developed countries (LDCs) in the Saarc region.

During the meeting India informed that it would unilaterally provide duty-free access to the LDCs on items, which are not in the sensitive list by December 2007.

India agrees to cut customs duties for Pakistan -DAWN - Business; November 29, 2007

 

[Introvert]

French trade team due

By By our correspondent
11/29/2007
KARACHI: French Trade Commissioner Francis Widmer stated that a delegation of French investors will visit Pakistan soon to explore possibilities for joint ventures.

During a meeting with the members and President of Karachi Chamber of Commerce and Industry (KCCI) he said that a great scope existed for joint ventures between the businessmen of France and Pakistan in different areas and this delegation will explore this potential.

He underscored the need to diversify Pakistani exports to France since most of its foreign trade consisted of conventional items like textiles and leather goods. Widmer particularly mentioned that Pakistan was facing acute shortage in public transport sector and as such French investors could assist Pakistan to overcome this problem.

He also suggested that Pakistan might also establish warehouses and distribution centres in France for onward export to EU and adjoining countries. He further pointed out that Pakistan and France enjoy good economic and trade relations and there exists a great scope of increase in bilateral trade and industrial cooperation.

He added that this was not reflected in the bilateral trade volume which was estimated at $677.2 million in 2005-06. Of the total, exports and imports to and from Pakistan were $336.7 million and $340.5 million respectively.
French trade team due

 

[ejaz007]

Ufone to invest $150m in network expansion

KARACHI: Ufone has announced to invest US$ 150 million in network expansion, which will add up more than 1000 additional cities towns and highways in its footprint.

It is estimated that by the end of June 2008 the company will be covering more than 4500 cities, towns, villages and all major highways in the country, a press release said here Thursday.

The contract has been awarded to Huawei Technologies, which is one of the most rapidly growing telecom vendors globally and awarding another contract to Huawei shows the company’s confidence in professionalism and state of the art technology. Huawei is the vendor of choice in latest 3G Telecommunications Networks, 31 of the world’s top 50 operators worldwide are using their technical infrastructure.

Walid Irshaid, President and CEO of PTCL while speaking at contract awarding ceremony said that an expansion contract of this magnitude indicates Ufone’s aggressive strategy towards market growth and expansion, in the wake of tremendous growth and potential of Pakistan’s cellular market.

The previous Network Roll-out phase of $550 million was the single largest expansion plan in the history of Pakistan and this region. That record-breaking execution by Huawei is near completion now and this new contract shows Etisalat’s commitment to the Pakistani market and will also boost investors’ confidence towards Pakistan.

The project was approved by the Board of Directors to invest in infrastructure and to provide best quality network and facilities its customers. In addition to the major investment commitment, Etisalat brings its extensive experience of Telecom Industry to Pakistan to ensure that THE company has the best network in the country.

Yi Xiang CEO Huawei Pakistan stated that Huawei is fully committed to Pakistan telecom industry as well as implementing this new network expansion contract in the fastest and most seamless fashion. staff report

Daily Times - Leading News Resource of Pakistan

 

[ejaz007]

ABN-AMRO to launch new products
Staff Report

ISLAMABAD: ABN-AMRO Bank is set to launch new products for small and medium entrepreneurs to strengthen Pakistan’s industrial base.

Country Head, Business Banking ABN-AMRO, Ch. Naeem Yaseen announced this in a meeting with President Islamabad Chamber of Commerce and Industry (ICCI), Nasir Khan here on Thursday.

The bank would provide credit facility with low interest rates.

ABN-AMRO, Mr Yaseen said was interested in assisting sick units for the industrial revival of the country and as well as for the prosperity of people.

He also informed that after ABN-AMRO’s merger with Prime Commercial Bank Ltd in Pakistan from 1st September and it was now ranked in the top 10 global banks and second largest foreign bank in Pakistan.

Earlier, the ICCI President Nasir Khan said that Pakistan had become an attractive country in banking investment due to high rates in the region.

He stressed that the bank should facilitate the business community for rapid industrialisation of the country.

He also stressed them to introduce special packages for sick units which number over 3,500 in the country. Due to a large number of sick units unemployment was gradually increasing.
Daily Times - Leading News Resource of Pakistan

 

[bhangra12345]

when are the Pakistan quarter results due?

 

[Neo]

when are the Pakistan quarter results due?

Mate,
We've been trying to implement quarterly reporting system since last FY but infrastraucture for data processing isn't still quite ready.
I expect Q1 data by mid Dec, Q2 by Feb according to my source in Karachi.

 

[bhangra12345]

Mate,
We've been trying to implement quarterly reporting system since last FY but infrastraucture for data processing isn't still quite ready.
I expect Q1 data by mid Dec, Q2 by Feb according to my source in Karachi.

ok thanks.

 

[Neo]

Pakistan losing Iranian rice market to India ​

Friday, November 30, 2007

KARACHI: Pakistani exporters bemoan that they are gradually loosing all international markets for the only exportable cash crop - rice, due to lack of coordination, weak foreign policy and poor performance of the ministry of commerce as well as apathy of their representative body - Rice Exporters’ Association of Pakistan.

A drastic drop of exports to Europe, Russia, Middle East and Saudi Arabia was recorded for several reasons but now a traditional buyer of Pakistani rice Iran is caught by arch rival of Pakistan - India successfully.

On the name of crackdown against the illegal trade, the Iranian government has imposed heavy tariffs recently that made legal shipments of Pakistani rice through land routes expensive as compared to the Indian imports through sea.

This provided a big vacuum for the Indian grain traders to fill and now they are gaining milestones on this front. Just three year before, Indian name was not prominent over the Iranian rice import map. During 2006-07, the Indians estimated an export of rice just at the tune of 60,000 tonnes but they successfully exported around 225,000 tonnes.

Indians are not dispatching the consignments to Iran directly but they are using their offices in Dubai to grab the new Iranian market. For the year 2007-08, Indians have already made contracts for the shipping around 150,000 tonnes and they estimated the total exports above the figure of 300,000 tonnes, a big landmark for Indians.

Indian exporters are selling Pusa - 1121 variety, a non-basmati long grain aromatic variety to Iran. Though Pusa - 1121 is technically non-basmati variety but it has aroma, good taste and 30 per cent more elongation as compared to the basmati rice that gave it a good reception in Iran, sources said quoting Indian exporters.

On the other hand, Pakistani exporters working with Iran claimed that sanctions imposed by the Iranians are a tactic of the Iranian government to promote the illegal trade in the area. There are war clouds roaming over Iran and they are trying to pile up grain stocks as much as possible within their limited resources, Haji Fojan, the biggest rice exporter for Iran based in Quetta told The News.

He exported rice worth of five million dollars two years ago but has no hope to get big orders from Iran this year. “The Iranian government is trying to curb the official trade with Pakistan,” he said and alleging that it was deliberately promoting informal trade. In the informal trade, the Iranian traders either pay in barter or in the Iranian or Pakistani currency thus they are saving their foreign exchange in terms of dollars or Euros, he said.

That is why, the Iranian government forced the Pakistani government to increase the in and out points at Pak-Iran border from one to eight.

“It is not right that rice is not going to Iran. You can see several trucks loaded with rice sacks moving towards Iranian boarder everyday but a not a single consignment crosses the border legally,” he claimed. By increasing the border openings from one to eight, illegal trade is very much easy that is in the benefit of Iran but not for Pakistan, Haji Fojan said.

Illegal trade to Iran and Afghanistan is also a major cause of price hike, another rice exporter Shamsul Islam Khan said. Due to the illegal trade, no one can quantify the availability of stock for local consumption as well as for the stocks, he said.

The government is well aware of the entire story of eliminating the Pakistani rice from the international market and filling the gap by the Indian archrivals but surprisingly no move was initiated to cope with the situation, Zahid Khawaja, a leading rice exporter for Europe commented while narrating the episode.

Pakistan losing Iranian rice market to India