Pakistan Economy - News & Updates - Archive

[Neo]

Tuesday May 23, 2006

ISLAMABAD : Wapda Chairman Tariq Hamid on Thursday briefed the National Assembly standing committee on water and power about the restoration of power supply to the quake-hit areas.

The committee met at the Parliament House under the chairmanship of MNA Ghulam Murtaza Maitla.


The Wapda chairman said restoration of electricity to the affected areas was a difficult task, but with extreme efforts of Wapda personnel power was restored within three days after the October 8 catastrophe.


Responding to a query about the village electrification programme throughout the country, the chairman assured the committee that all the villages would have the facility of electricity by the end of 2007.


He also informed the committee about the policy of converting illegal connections into legal ones in Khuzdar district, Balochistan.

 

[Neo]

Tuesday, May 23, 2006


ISLAMABAD: The Annual Plan Coordination Committtee (APCC) has estimated that GDP growth is expected to touch seven percent by the end of the current financial year, as compared to growth of 8.4 percent in the last fiscal, an official said on Monday.

The estimates of APCC, which met here, are based on initial projections of different sectors. The APCC is also expected to fix a floating growth target from 6 to 8 percent for the next five years including 2006-07, a senior government official told Daily Times.

The performance of different sectors during the current financial year is under review of the APCC. The meeting would continue till late Monday night, the official said. The APCC estimates are nearly the projected target of 7.2, which is the actual growth target for the current fiscal. Last year, the performance of agriculture sector remained outstanding and it had registered growth of 7.5 percent in 2004-05.

He said this fiscal, the agriculture growth could hardly be near four percent owing to decrease in cotton and wheat production. The large scale manufacturing (LSM), which registered a growth of over 12 percent in the last fiscal, has been estimated to grow at less than 10 percent this fiscal.

 

[Neo]

ISLAMABAD (May 24 2006): Pakistan is keen to finalise the 'Bilateral Investment Treaty' (BIT) with the United States at an early date, Prime Minister Shaukat Aziz told the visiting Under-Secretary of State for Economic, Business & Agriculture, Ms Josette Shiner, who called on him here on Tuesday.

He said that finalisation of the BIT would enhance the volume of trade between the two countries and, as a result, more employment opportunities and business activities would be generated.

The Prime Minister appreciated the plan to set up 'Reconstruction Opportunity Zones' (ROZs) by US in Pakistan, and said that ROZs would contribute to the overall economic uplift of the commercially depressed zones and less developed areas, as the infrastructure of these areas would be strengthened to set up these zones, and the population of the areas would get more jobs and better facilities of life.

The Prime Minister also appreciated the proposal that the goods manufactured in the ROZs would be exported to US markets on preferential terms.

Shaukat said that despite pressures created as a result of high oil prices and the losses caused by earthquake, the country had achieved the growth target of 6 to 8 percent, inflation was settling down and the overall inflation during the fiscal year 2005-06 remained less than 8 percent. He said that foreign direct investment (FDI) was expected at about $3 billion, highest in the history of the country.

About the energy policy, he said that to sustain the accelerated growth within the range of 6 to 8 percent and to remain competitive in the rapidly globalizing world, Pakistan was focusing on energy and water security. He said that Pakistan was focusing on both enhancing the indigenous capabilities in oil and gas sector and on importing gas from neighbouring countries.

He said that Pakistan, located at the confluence of South Asia, Central Asia, and West Asia, provided the shortest access to the sea for all landlocked countries of Central Asia and Western Asia. Pakistan, he said, is playing an important role in facilitating the regional trade.

UN reforms and restructuring proposals also came under discussion. The Prime Minister made many suggestions to transform the UN into a more vibrant and effective organisation, geared to meet the new challenges.

Shiner appreciated the recommendations made by the Prime Minister, saying that his recommendations were practical and valuable.

She said that US is keen to see more development and prosperity in Pakistan, and ROZs would help in creating more economic opportunities. She appreciated the economic recovery achieved by Pakistan and noted that, according to a World Bank ranking, Pakistan is among the top 12 reformers of the world. Josette Shiner also appreciated the investment-friendly policies of Pakistan.

She said that during her stay in Pakistan she would review the working of UN organisations in Pakistan to determine the changes required to make UN a more vibrant organisation.

The meeting was attended, among others, by Adviser to the Prime Minister on Finance Dr Salman Shah, Minister of State for Economic Affairs Ms Hina Rabbani Khar, Ambassador of US in Pakistan Ryan C Crocker and some senior officials.

MEETING WITH SALMAN SHAH: The visiting US team led by Under Secretary for Economic, Business and Agricultural Affairs, Josette Sheeran Shiner had a meeting with Advisor to the PM on Finance and Economic Affairs, Dr Salman Shah here to launch the strategic economic dialogue between the two countries.

US Under Secretary was accompanied by Ryan Crocker, US Ambassador to Pakistan, Chris Moore, Dy. Assistant Secretary and senior officials of US Embassy and USAID.

Pakistan side included Secretary General Finance, Secretary Finance, Secretary EAD and functionaries of other ministries.

The US Under Secretary appreciated the efforts being made by the Pakistan government for the revival of its economy and stressed the need for greater co-operation between Pakistan and USA to enhance trade and business activities.

US Under Secretary of State stressed the need for preparing a comprehensive working paper encompassing the requirements for improving bilateral trade and business for thorough discussions and deliberations in the next meeting to be held in July in Washington.

The meeting was also attended by senior officials of the Ministry of Finance, BoI, Health, Planning and Development, Water and Power, Commerce, Education, Communication, Foreign Affairs, NEC, Industries and Production, NHA, Railway and SBP.

 

[Neo]

KARACHI (May 24 2006): All Aero Asia and Shaheen Air International (SAI) aircraft remained grounded for the second day on Tuesday as no agreement could be reached between the airlines and the Civil Aviation Authority (CAA) on payment of CAA dues.

Officials of CAA remained engaged in meetings, separately, with the representatives of the two defaulting airlines, without any result.

CAA is reported to have stood firmly on its decision that either the private carriers should clear their dues, or be prepared for rolling back their operations.

CAA presented its proposals regarding the mode of payments and Aero Asia and SAI came up with theirs, but till the close of office hours none of the airlines turned up to say that they were ready to accept CAA's formula for clearance of the dues.

In the morning, a CAA spokesman told Business Recorder: "Enough is enough. They can not take us for a ride any longer. After all, the airlines will not be paying anything from their own kitty. It is public money which they have collected through the sale of tickets and have no right to use that money somewhere else and deprive CAA of its revenues."

Private carriers had been promoted and pampered for too long. Now they should learn to stand on their feet and walk without the help of crutches, he said.

Till late in the evening, no official statement was available from CAA whether the issue had been resolved or not.

 

[Neo]

ISLAMABAD (May 24 2006): The federal Cabinet will ratify the agreement between Pakistan and Brunei Darussalam for establishment of joint investment company. The authorised capital of the JV Company would be $25 million in the equivalent of Pak rupees and the parties capital contribution will be as follows.

Official sources told Business Recorder that $12.5 million capital contribution would be made by the BIA, the value of the shares being payable in dollars, and $12.5 million, capital contribution by Pakistan, the value of the shares being payable in rupees.

The main purpose of the company was to consolidate joint efforts to promote economic co-operation between the two countries for investing in the industrial, manufacturing and non-manufacturing sectors, financial services and marketing of their products in Pakistan and abroad.

Pakistan has already facilitated establishment of four joint investment companies with brotherly Muslim countries, namely, Pak-Libya Holding Company (PLHC), Pak-Kuwait Investment Company (PKIC), Saudi Pak Industrial and Agricultural Investment Company (Sapico), and Pak-Oman Investment Company (Poic).

These joint ventures have been established on equal-sharing basis for project financing in various fields in Pakistan, the sources said, adding they have been functioning successfully and earning substantial profits.

It may be mentioned here that a memorandum of understanding (MoU) was signed during the visit of Prime Minister Shaukat Aziz on May 7, last year, but the formal approval was given at JEC on March 17, 2006.

The duration of the agreement would be 20 years renewable for a further period as mutually agreed upon. Within 90 days of the signing, the parties shall establish Pak-Brunei Joint Investment Company in accordance with the laws of Pakistan.

The head office or registered office of the company would be situated anywhere in Pakistan and its board of directors may establish branches, offices or agencies in Pakistan or abroad.

In addition, the agreement on establishment of Pak-Iran Joint Investment Company was signed on February 23 last year after ratification by the cabinet, steps are being taken for establishment of the company in consultation with Iranian counterparts.

 

[Neo]

ISLAMABAD (May 24 2006): United Kingdom is one of the biggest investors with over 200 registered companies operating in various sectors, said UK ambassador to Pakistan, Mark Lyall Grant here on Tuesday.

Speaking at the launching ceremony of the UK land investment group in Islamabad, Grant said that UK investors in Pakistan have the opportunity to invest in prime, underdeveloped land in the UK with a view to achieving high returns in a stable economic market with the added security of official freehold ownership.

For the first time Pakistani investors are being provided with the opportunity to diversify their investment portfolio through an international company based locally and one that understands the needs of this fast moving market, he disclosed.

The United Kingdom Land Investment Group is proud to announce its first joint venture consortium in Pakistan with National Construction (Private) Limited, Gandhara Consultants (Private) Limited and the Orient Group.

The Consortium has already launched an aggressive bid for one of Pakistan's latest mixed development ventures.

The United Kingdom Land Investment Group Pakistan operation will be expanding into other major cities including Lahore, Karachi, Sialkot and Faisalabad.

With a comprehensive national marketing campaign to be launched this week this promises to be an existing period in the world of investment in Pakistan and United Kingdom Land Investment Group has established its firm foundations and is here to stay.

 

[Neo]

ISLAMABAD (May 24 2006): Bilateral trade between Pakistan and China is expected to reach 8 billion dollars by 2008. This was stated by Director East-Asia Institute of Strategic Studies Islamabad (ISSI) Fazal-ur-Rehman who was speaking on Pak-China Economic Co-operation here on Tuesday.

There is need for the involvement of private sector for rapid economic growth of both the countries. This was general consensus of the participants of the daylong seminar on 55 Years of Pak-China Relations held by ISSI.

The two sides acknowledged the fact that in order to sustain a comprehensive co-operative relationship, substantive economic co-operation, matching the level of political and strategic co-operation was absolutely essential.

The economic dimension in Pak-China relations has come to the forefront and began to show signs of improvement, in terms of trade and investments.

The trade between the two countries has seen considerable rise from 2001 till today. In 2001 the trade volume was 1.4 billion dollar, 2004 it was 3 billion dollar, 2005 it reached 4.25 million dollar and presently it is estimated to touch 5 billion dollar.

The current status of Chinese investment is more than 4.0 billion dollar and 114 Chinese projects are underway.

According to the Chinese Custom Authority, Pakistan export to China showed an upward trend, registering an increase of about 39.2 percent in 2005. It enhanced from 594 dollar to 832 dollar in the same periods of 2004 and 2005.

It was expected that Pakistani economy would continue its growth at the same rate and bilateral trade would reach 8 billion dollar by 2008.

At present Gawadar Port, upgradation of Karakoram Highway, Thar Coal Mining, upgradation of Pakistan Railways and Power Generation Projects - both nuclear and non-nuclear are some of the notable projects expanding economic co-operation.

The participants in the seminar were of the opinion that though the two-way trade has increased, the volume of trade is heavily in favour of China. Pakistan's exports to China lack diversity. Diversification of exports from Pakistan in the non-traditional items will help reduce the trade imbalance.

The main imbalance of trade is due to import of machinery, engineering equipment besides complete transfer of plants and equipment from China. The Pakistan has very few complimentaries in all sectors of trade. The trade imbalance deficit ratio of Pakistan and China is 1:5.

The figures depicted may be little different if there was no under invoicing and other illegalities, which are part of Pak-China, trade as was discussed in the seminar.

Professor Zhan Yunling chairing the session commented in his concluding remarks that Pakistan would have to enhance its capacity for the Chinese products for economic growth rate sustainability.

He said that China is desirous to promote economic relations in the South Asian countries as it has great regard for regional level co-operation and wants to see the role of Saarc more effective, he added.

 

[Neo]

ISLAMABAD (May 24 2006): Export Promotion Bureau (EPB) Director M Saleem Ahmad Ranjha said on Tuesday that due to policies of the government, the export would be doubled in next three years.

Talking to PTV, he said during last three years, a lot of work was done in diversifying markets and for new productions also.

He said export to Afghanistan had increased to one billion dollars, adding that Pakistan was touching closer markets like Bangladesh, Gulf, India and Iran.

Export of fruits also increased this year and Pakistan exported 0.2 million tonne fruit, he added.

He said Pakistan had explored new market for oranges and 304,000 tonne orange was exported to Russia, adding that the export of mango would also be increased.

He said the EPB had introduced a scheme, according to which every Pakistani company, which had three retail sales outlets in the country or its export was almost one million dollar and desired to open outlet abroad, the 50 percent annual rent of the first year, 25 percent of second year and 10 percent of third year would be recovered by Pakistan government.

Companies were giving good response in this regard, he added

 

[Neo]

ISLAMABAD (May 24 2006): The only way to progress for developing countries is to develop a knowledge economy, as highly skilled and trained human resource has now become the single most important factor in the process of socio-economic development, Dr Atta-ur-Rahman, Federal Minister and Chairman Higher Education Commission said on Tuesday.

He was speaking at an international symposium on science and technology in Muslim countries, which was organised by the world's leading scientific journal Nature at Rockefeller Foundation's Conference and Study Centre in Belliagio, Italy, said a message received here.

Dr Atta-ur-Rahman's presentation was titled, "Science and Technology in OIC Member Countries- Challenges and Opportunities".

"For developing countries, international collaborations can bring new thinking to help solve old problems. Muslim countries find themselves near the bottom of global tables in terms of the number of research articles published annually.

This is illustrated by the fact that the total number of international publications from the entire Islamic world taken together each year is less than those from a small European country such as Switzerland, said Dr Atta-ur-Rahman.

This was largely because of the lack of vision in the leadership of the Islamic world who has miserably failed to invest in science. Thus the oil-rich Arab countries presently spend up to 7 percent of their GNPs on defence but only 0.2 percent on research and development.

The gap between the Muslim world and the West therefore continues to widen with each passing day. He stressed the need for Muslim countries to lay more emphasis on research with relevance to national needs as well as creation of genuine world class Centres of Excellence.

Professor Atta gave a presentation on the work of Committee of Ministers of Science and Technology in OIC member countries (Comstech) in promoting scientific co-operation in Muslim States, which was greatly appreciated. He also shared his experiences of rebuilding higher education, science and technological infrastructure of Pakistan.

The aim of the symposium was to exchange best practices with a view to encourage more high quality research in predominantly Muslim countries. The conference brought together leaders from science, government and civil society in the Muslim countries as well as the advanced countries and provided a stimulating opportunity for the gathered individuals to debate as to how to strengthen their science and technology bases and promote greater international collaboration.

 

[Neo]

KARACHI (May 24 2006): The permission to import used cars was a temporary measure to meet the demand-supply gap, which is now closing, as the industry has increased capacity.

Standing Committee on Production Chairman MNA Malik Niaz Ahmad Jakhar has said this while presiding over a meeting at the Indus Motor Company (IMC) here to discuss the issues pertaining to the local automobile industry.

He reiterated that instead of imports, focus should be on local car production by providing conducive environment for investment in the sector that would also promote the business activity as well as the vendors.

The committee recommended that the local automobile industry to be given protection to further boost the industry and its vendors. In this connection, a long-term policy and restriction on import of used cars was necessary, the committee suggested. Malik Niaz Ahmed Jakhar said Pakistan's automobile industry had developed substantially in recent years and would continue growth at the same pace.

He appreciated the IMC's performance and said the development in this sector resulted in enhanced employment, investment and transfer of technology.

Appreciating the plant and its efficient workers, he said in the last four years, IMC had enhanced its production from 57 cars per day in 2002 to about 200 cars per day, and delivery period had reduced considerably.

 

[Neo]

ISLAMABAD (May 24 2006): A seminar on 'Railways Vision' is being organised here on Friday to focus on economic well-being of Railways to meet the international standards. The Prime Minister Shaukat Aziz is likely to be the chief guest at the inauguration. Minister for Railways Sheikh Rashid Ahmed talking to APP said steps were being taken to reinvigorate the Railways by putting it on improved track.

He said a number of proposals would be given due consideration at the seminar, including replacement of existing railway tracks, besides engaging private entrepreneurs for the running of new locomotives and coaches thus offering more facilities and comforts to the passengers.

The minister said the Railways was actively working for the up-gradation of the existing signalling system as an effort to make it more fool-proof and error free through computerisation.

 

[Neo]

ISLAMABAD (May 24 2006): The Cabinet is likely to approve restructuring of the country's federal statistical system by merging Federal Bureau of Statistics (FBS), Population Census Organisation (PCO), Agricultural Census Organisation (ACO) and the technical wing of Statistics Division into an autonomous body, called 'Pakistan Bureau of Statistics' (PBS).

It has been proposed that FBS and ACO should be merged immediately, while PCO should be made part of the new entity after Census in 2008.

The Cabinet, which would meet on Wednesday, would also take stock of the law and order situation, besides discussing other issues.

Official sources told Business Recorder that the purpose behind the re-organisation of the country's statistical system is to make it more responsive to national requirements, with increased autonomy and credibility, through better co-ordination and integration of different data collecting agencies.

They said that the restructuring plan has been prepared by consultants from Norway and World Bank, after analysing the existing statistical organisations. With the recommended merger of FBS, PCO, ACO and the technical wing of Statistics Division into PBS, with functional members, the new body would be headed by Chief Statistician.

The organisation is to be restructured on the pattern of CBR, for which a new law is also to be enacted to give shape to the new organisation.

The proposed structure of new body would as follows:

i) Three organisations FBS, PCO, ACO and technical wing of Statistics Division will be merged on the model of CBR, and named as Pakistan Bureau of Statistics (PBS).

FBS and ACO will be merged immediately, while PCO will be merged after the National Census in 2008.

ii) The government would undertake steps to improve the performance and promote professionalism in the PBS.

iii) Unified law merging the existing laws and covering the new requirements would be subsequently drafted and submitted for approval of the Cabinet.

iv) Seniority of individual officials in the new set-up would be decided in accordance with the general seniority rules of the government.

v) New composition and Terms of Reference (ToR) of the 'governing council', 'management committee' and the 'statistics users council' will be issued after approval by the Cabinet.

vi) The 'Chief Statistician' and the 5 'Members', approved by the Prime Minister, would be in MP-1 and MP-2, respectively, to be hired on contract basis for a term of 3 years, by open competition.

vii) Since restructuring will involve considerable administrative work, the present Statistics Division will continue for the time being. Once the PBS takes final shape, the need for continuation, or otherwise, of the Statistics Division will be reviewed.

Sources said that Prime Minister Shaukat Aziz has already cleared the proposed sketch of the new body.

 

[Neo]

ISLAMABAD (May 24 2006): The trilateral Joint Working Group of Iran-Pakistan-India gas pipeline project at the two-day talks concluded here on Tuesday decided to continue discussions on gas pricing, and the three sides agreed to hold the next meeting in July in India.

Pakistan delegation was led by Petroleum Secretary Ahmad Waqar, Iranian delegation by Deputy Oil Minister M H Nejad Hosseinian, and Indian delegation by Secretary Petroleum M S Srinivasan.

Briefing newsmen after the meeting, along with Iranian and Indian delegation heads, Ahmad Waqar said that the meeting had agreed that gas would be delivered to Pakistan at Iran-Pakistan border, the pipeline would be connected to Bhong, near Rahim Yar Khan, and then to India, on Pakistan-India border.

On gas pricing, he said it was agreed that the pricing mechanism required more deliberations and expressed hope that agreement would be reached on the issue in the next trilateral meeting to be held in India.

In addition, he said, it was also agreed that a project co-ordinator would be appointed to oversee implementation of the project.

Replying to a question about US pressure, Waqar said that President Musharraf and Prime Minister Shaukat Aziz had mentioned on a number of occasions that they would pursue this project keeping in view national interests.

"Pakistan's economy is growing, and to sustain six to eight percent growth rate, the country needs energy, and Iran is one of the major sources of energy", he added.

He said that the Turkmenistan-Pakistan-India gas pipeline project was also being pursued, as energy is needed from both sources.

In reply to a question about US pressure the Indian delegation head said that "there is no pressure from anyone. This project is necessary and important to fulfil our energy needs".

About the UN sanctions, Indian Petroleum Secretary said, "We have crossed the bridge to meet our energy needs".

Pakistan Secretary said, "It is quite hypothetical." And the Iranian head said that Iran was not under such pressure.

Waqar said that essentially the project is trilateral, but if India quits, then it would be bilateral. "We are pursuing it parallel in bilateral or trilateral ways," he added.

 

[Neo]

Wednesday May 24, 2006

ISLAMABAD: Federal Minister for Commerce Mr. Humayun Akhtar Khan said that while Pakistan is working towards attaining full dialogue partnership with ASEAN, it continues to engage bilaterally with key ASEAN economies.
Mr. Humayun Akhtar Khan was talking to local journalists in Singapore after meeting with Singapore President.

The two discussed matters of mutual interest with the focus on trade and commercial relations between Pakistan and Singapore.

Humayun Akhtar explained that while Pakistan is working towards attaining full dialogue partnership with ASEAN, it continues to engage bilaterally with key ASEAN economies. He said Pakistan is negotiating Free Trade Agreements with China, Singapore and Malaysia, Early Harvest Programme which China is already in place. Till this time that Free Trade is not fully practiced, preferential Trade Agreements will play a great role for Pakistan, the Commerce Minister added.

The Minister said that Government of Pakistan is working hard to offer a preferential playing field and it is for the exporters to reach out. Similarly, the investors have to come out and access the opportunities made available to them in Pakistan.

The Minister for Commerce is visiting the state city of Singapore to attend the Conference of Regional Envoys of Pakistan being held to brain storm and evolve a strategy for promotion, trade diplomacy and investment promotion. The focus of this Conference is on ASEAN and on China.

 

[Neo]

Wednesday May 24, 2006

KARACHI: Indus Motor Company (IMC) has assured the standing committee that the production of company has been increased and further production capacity enhancement plans are being made. Delivery times of several cars have already come down to 30-45 days.
The meeting of Standing Committee on Production held on Tuesday in Indus Motor Company Limited under the Chairmanship of Malik Niaz Ahmad MNA to discuss the issue pertaining to Local Automobile Industry in Pakistan.

MNAs Rifftat Javed, Saeed Ahmad, Nasim Gul Afridi, Sher Muhammad Baloch, Fehmida Mirza Azhar Ahmad and Muhammad Aslam Bodla were present in the meeting.

The Management of Indus Motor Company Limited briefed the Committee about the process of the manufacturing of cars and highlighted issue of Local Automobile Industries in Pakistan. The committee assured the management to consider the issue regarding imports of used cars sympathetically to sustain the local Automobile Industry.

The committee recommended that the local Automobile Industry might be encouraged to boost up the production and to meet the local demands.