Pakistan Economy - News & Updates - Archive

[Neo]

Punjab to cut next ADP to Rs130bn​

LAHORE, June 6: The Punjab government plans to “rationalise” its annual development plan (ADP) for the next fiscal year by cutting it down to around Rs130 billion from the original estimate of Rs150 billion for the outgoing year, provincial finance minister Tanvir Ashraf Kaira told Dawn.

“I won’t say that we are decreasing the size of the provincial ADP for the next year from Rs150 billion. I say we are increasing it from what – almost Rs122 billion – the province spent this year on development,” he said, adding the original estimate of the provincial development plan for the outgoing year was ‘unrealistic’.

“The previous government inflated the revenue estimates as well as development spending for the outgoing year for gaining political mileage,” he said. “We shall be more realistic while making allocations and spend every rupee we budget for development in the province. We will avoid revision of the size of the development programme because it affects the process of development.”

Mr Kaira said the provincial government would finance its development programme by cutting non-development spending and improving its own tax revenue.

The minister said the coalition government of the Pakistan Muslim League-Nawaz and Pakistan People’s Party had also decided to review the two mega projects – the Lahore Mass Transit System and the Lahore-Sialkot Motorway – initiated by the previous provincial government.

“We don’t want money-making projects. If these projects are in the larger interest of the people and found helpful in overcoming traffic problems, we shall continue with them,” he argued.

He said the provincial government was not facing any problem in preparing its budget for the next fiscal year in spite of lower federal transfers on account of shortfall in tax revenue collection by the Federal Board of Revenue due to political turmoil and slowing economy during the current financial year.

Punjab has received seven to Rs8 billion fewer than Rs226 billion it had estimated to get from the federal government. “We will adjust our expenditure according to the drop in the federal transfers,” he said.

However, Mr Kaira said, the provincial government was considering a number of proposals to increase provincial own tax revenue through expanding the scope of sales tax on services, rationalising the existing provincial taxes and plugging leakages. The provincial government has already facing a 30 per cent shortfall in its targeted tax revenue collection for the present fiscal year.

The minister said the province would have to look toward multilateral donors for budgetary support if it had improved its tax resource. Also it could provide better services to the citizens. He said the tax revenue target for the next year would also be kept realistic and achievable. But he refused to say if it would be greater or lesser than the original tax revenue target for the outgoing year. “It would be realistic and definitely higher than what we have achieved this year.” He said the province needed to develop tax culture so that people did not avoid paying taxes. To a question regarding agriculture income tax, he said it could easily be doubled from its current level of Rs800 million just by facilitating the taxpayers.

Mr Kaira said the provincial government would enhance funding for the core social sector – education, health, water supply, etc – and try to involve public in the management of the programmes and spending on them. He said the new government was determined to providing better facilities to the people and preventing leakage of funds.

Punjab to cut next ADP to Rs130bn -DAWN - Business; June 07, 2008

 

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Savings schemes mobilise Rs 73.969 billion ​

KARACHI: National Savings Schemes mobilised Rs 73.969 billion during the first ten months of the current fiscal year, which is higher by 9.39 percent than Rs 67.651 billion mobilised during the full 2006-07 year.

The government received Rs 2.768 billion through Defence Savings Certificate, Rs 311.9 million through Regular Income Certificates, Rs 13.244 billion through Special Savings Certificates (Reg), Rs 9.508 billion through prize bonds, and Rs 48.135 billion through other instruments.

The federal government had revised upwards the rates of return on national saving schemes on June 23, 2007. The rates on Defence Savings Certificates were enhanced from 10 percent to 10.15 percent, on Special Savings Certificates/ Account from 9.17 percent to 9.25 percent, on Regular Income Certificates from 9.24 percent to 9.54 percent, on Pensioners’ Benefit Account & Bahbood Savings Certificates from 11.52 percent to 11.64 percent and on Savings Account from 6 percent to 6.50 percent.

Daily Times - Leading News Resource of Pakistan

 

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Pakistani economy adrift with nobody in full charge: Burki​

* Economist says policy makers have no serious priorities, common man sees no sign of relief
* Says period of high growth in Pakistan is over
* Says government should not be held responsible for current wheat shortage
Warns government against subsidising energy​

WASHINGTON: No one is in full charge of Pakistan’s economy, while the political elite is preoccupied with the judges’ issue and power-sharing arrangements, according to Pakistani economist and financial planner Shahid Javed Burki.
Burki, a former World Bank vice president and finance minister in the Moeen Qureshi caretaker government, told a meeting at the Woodrow Wilson Centre, at which he is a senior scholar, that there is a “disconnect” between the poor, whose prime concern is their next meal, and the elite. The establishment and the citizen are not on the same page, which is making the common man increasingly angry as he sees no sign of any serious attention being paid to his precarious situation. Burki said if the present situation continues, there would be social and political turmoil. He said he found during several months of stay in Pakistan that the policymakers have no serious priorities.
Burki said looking back over the last 60 years, Pakistan has not done badly economywise, having maintained an annual growth average of 4 percent. The country’s economy has grown 18 times since independence. There has also been a significant decline in poverty, which was 65 percent in 1947 but which has fallen to 33 percent today. Only 20 percent of Pakistan’s income is derived from agriculture, while 53 percent comes from the service sector.

Period of high growth is over:

The worrying aspect of Pakistan’s economy is that it is dependent on external capital, not domestic resources. Neither has Pakistan invested in the development of its vast human resources. Investing in education should be the top priority from now on, Burki stressed. He also warned that the period of high growth for Pakistan is over. Poverty is going to increase and income disparities are set to worsen. Pakistan is also burdened with a huge fiscal deficit, which stands at 7.5 percent to 9 percent of GDP, with trade and balance of payments representing a good part of it. Pakistan, he explained, can only tolerate a deficit of 4.5 percent to 5 percent. He advised the government to cut down public spending but without slowing growth. He pointed out that the Musharraf government had failed to enhance even by one kilowatt Pakistan’s power-generating capacity, which was why the country had been hit today by such severe shortages. He said the rich are protected against power shortages as they have their own generators but the vast majority is in dire straits and it is angry and restless.

Wheat shortage:

Burki said that the government should not be held responsible for the current wheat shortage. He pointed out that the terms of trade worldwide are in favour of agriculture and Pakistan’s policymakers must take advantage of that because Pakistan has a lot of potential, given the right set of public policies. He regretted that Pakistani policymakers know very little about the global economy and as a result, the country is not well integrated into the global economic system. Burki said it is absolutely necessary to have a high rate of savings and investment, while the market should be allowed to determine the allocation of resources, but the private sector should not be “hand-held”, as in the past.

Energy subsidies:

He also warned against providing energy subsidies, nor should the government become the employer of last resort. There should be no open-ended protection to the textile industry and no price controls to cut inflation. Public servants must not be underpaid. Punjab, he predicted, could become the “engine of growth” for the rest of the country, but it must reduce the burden it places on the federal government.

Shaukat Aziz:

He described former prime minister Shaukat Aziz’s economic policies as “misguided” and a result of his failure to understand the strategy of economic planning. He said what Aziz had given Pakistan what could only be described as “casino economics”.

Daily Times - Leading News Resource of Pakistan

 

[Neo]

Russia lifts ban on Pakistani rice and fruits import ​

ISLAMABAD (June 07 2008): Russia has decided to lift the ban on rice import from Pakistan, sources told Business Recorder here on Friday. They said that a Russian delegation met here with the representatives of the Ministry of Commerce and Food Ministry and agreed to lift the import ban imposed on Pakistan's rice.

Russia used to import about 0.5 million tons rice per year from Pakistan. In 2007 from November 21 to December 26, a Russian delegation visited Pakistan to review the sanitary and phyto-sanitary conditions regarding the packing and processing of the citrus fruit and mangoes to lift the ban on import of these fruits imposed by it two years ago and finally the ban has been lifted.

Similarly, the officials of Russian Federal Veterinary and Phytosanitary Surveillance Services (VPSS) recently visited Pakistan on April 23 to discuss plant protection and Phytosanitary issues with Rice Exporters Association of Pakistan (Reap).

"During that visit by the Russian delegation, Reap representatives told the members of the delegation that Pakistan's rice is now free of 'Khapra' beetle and asked them to conduct a survey of the processing factories to ensure that the country has observed the sanitary and phyto-sanitary conditions and the import of any commodity from Pakistan does not involve any risk at all", sources explained.

In the meeting held here on Friday, June 6, the ban imposed on the import of the other fruits and vegetables has also been removed by Russia. "Now the country will start exporting fruits, vegetables and rice again to Russia that will indeed result in earning heavy foreign exchange", sources added.

Business Recorder [Pakistan's First Financial Daily]

 

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KSE recovers 1,004 points as govt extends CGT exemption ​

Sunday, June 08, 2008

KARACHI: After losing nearly 15 per cent in the last two consecutive weeks, the Karachi stocks market recovered half of these losses after getting another two-year extension in the exemption of Capital Gain Tax (CGT) on securities transactions.

KSE 100-share Index posted a handsome recovery of 1,004 points or 8.3 per cent on week on week basis and concluded at 13,135 points.

The free float market capitalisation based the 30-Index regained 1,352 points or 9.6 per cent and finished at 15,450 points.

The average turnover of the week declined to 175.8 million shares from 202.8 million share of last week. However, the overall market capitalisation surged by Rs300 billion to stand at Rs4.046 trillion.

Liquid investors accumulated fundamentally strong stocks at the historical low prices on Monday and pushed market further up on follow up buying on Tuesday as well.

Prior to the start of this week, market had lost 22.6 per cent or 3,546 points to 12,130 points - the nine month lowest level - from 15,676 points all time high closing level of April 18, 2008.

On wow basis, the market had lost nearly 15 per cent or 2,102 points in the last two consecutive weeks, as the third last week in series had closed on positive note.

Market took a nosedive after expiry of CGT on June 30, 2008. According to the sources, the inflectional brokers, financial institutions and big individual investors were pushing market down in artificial manners to get further relief in CGT from the government.

As a matter of record, the capital markets are exempted from CGT since 1974. Following the news of CGT exemption till June 30, 2010, the KSE 100-shares Index gained 610 points in a single session on Wednesday.

The rest of two-sessions of this week invited consolidation above 13,000 points level. Investors that had suffered losses in speculatively managed stocks market - opted to book profits at the available margins.

Investors again came under pressure on Friday when FBR Chairman, Abdullah Yousuf’s stated that government was yet to finalize the CGT issue and final decision would be in coming budget. Later on the same day (i.e. Friday), FBR Chairman himself contradicted his statement on CGT thus attracting some fresh funds in the market.

Insurance leads: “Insurance sector attracted the major portion of funds and gained 16.5 per cent on weekly basis. This sector was the chief beneficiary of CGT, as a major share of insurance earnings is derived from investment income. Oil Marketing Companies (OMC’s) gained 10.7 per cent on weekly basis, on the back of robust earning expectation in fourth quarter of fiscal year 2008. Moreover, banking sector recovered 8.6 per cent,” according to JS Research.

The cement sector gains were linked to new development projects to be started in the next fiscal year.

The fertilizer and telecom sectors also witnessed notable buying and ended the week on positive note.

Overseas investors: The Foreign Portfolio Investors (FPIs) also booked profits this week. The figures available at NCCPL website regarding FPIs funds explained that they sold their holding in rising market and repurchased shares in declining market. They uploaded stocks in the fist two sessions of the week and offloaded their holding in the last three sessions. On net, they withdrew another Rs813 million this week.

During the week, CFS investment stood at Rs32.3 billion, up by 3.2 per cent. On the contrary, CFS rate dropped to 15.8 per cent versus 17.9 per cent last week.

Weekly Movement in Blue Chips

Symbols Open on Close on Difference

Monday (Rs.) Friday (Rs.) (Rs.)

Adamjee Ins. 254 305 51
DGKC 72.6 79.8 7.2
EFU Gen. Ins. 329.50 412.04 82.54
ENGRO 279.01 299.01 20
FFBL 33.9 35.5 1.6
HBL 199.89 213.02 13.13
LUCK 108.45 113.35 4.9
MCB 274.41 305.5 31.09
NBP 157.9 175 17.1
OGDCL 123.7 131 7.3
POL 368 394 26
PPL 249 267.5 18.5
PSO 440 483 43
PTCL 39.81 43.4 3.59
UBL 101.75 111.11 9.36

KSE recovers 1,004 points as govt extends CGT exemption

 

[Neo]

Sugar production reaches 4.73m tonnes ​

Sunday, June 08, 2008

ISLAMABAD: Pakistan has produced about 4.73 million tonnes of sugar to fulfill its domestic consumption for the year 2008-09.

An official in the Ministry of Food, Agriculture and Livestock (MINFAL) told APP here on Saturday that about 4.2 million tonnes of sugar was consumed per annum as against the total production of 4.73 million tonnes of sugar.

Surplus stock of about 0.52 million tonnes of the said commodity is available for domestic consumption, as its demand showed an upward trend during the hot season because of habitual use of cold drinks and other cold and sweet beverages products, he said.

Beside this, the official said that the government has always kept an average of two month sugar stock as a food security measure to tackle any unwanted situation in the country.

Government has set the target to cultivate sugarcane crop over 1.39 million hectares of land during 2008-09 to further increase sugar production for domestic consumption, as well as to export, he added.

In Punjab 0.7 million hectares of land was set to produce sugarcane, while in Sindh 0.230 million and NWFP 1.09 million hectares land was set to be put under sugarcane cultivation respectively, he said.

He said that targeted area under sugarcane was decreased as the total area under sugarcane cultivation in 2007-08 was 1.241 million hectares.

He said sugar mills were fully functional and crushing cane as according to official fixed rates of crop, adding that the provincial governments were observing the situation and trying to facilitate all the stakeholders.

Sugar production reaches 4.73m tonnes

 

[Neo]

Rs56bn relief for poor suggested​

KARACHI, June 7: To protect the vulnerable groups from pains of adjustments aimed to achieve stability and threat of starvation Rs56 billion should be allocated to provide relief to the poor. The current monthly food support amount of Rs200 per month should be revised to Rs1,000 for four million households.

The Social Policy Development Centre recommends pro-poor allocation of about one fifth the size of the proposed PSDP and five-fold increase in food support programme in its report ‘Fiscal policy choices in budget 2008-09’ launched by Dr Hafiz Pasha here early this week.

“Based on the estimation of monthly expenditures on food items by the lowest income quintile in Household Income Estimation Survey 2005-06, the support amount is recommended at Rs1,000 per month per household,” says the report.

The report assessed the efficiency of different administrative set ups targeting to provide relief to the poor and found Pakistan Bait-ul-Maal (PB M) to be most effective when evaluated on a set of criteria developed for the purpose.

“PBM has developed a management information system to record basic information on programme beneficiaries -- which makes targeting more effective and monitoring of progress easier. Its overall administration costs are four per cent of total resources,” says the report.

The report does not favour extension of general food subsidy offered through Utility Stores Corporation of Pakistan because it scored “low on six criteria, including targeting efficiency, low coverage, and high share of programme expenditure scores high in three criteria, degree of ease of access, absence of negative incentive effects and degree of freedom from private transfers.”

The report analysed two livelihood programmes, national employment guarantee scheme for poor and graduate employment scheme but advocated to implement them only after “successful piloting”.

The report concludes on the note: “Given the characteristics of the people need to be cushioned from the adjustment burden, a combination of cash transfers and livelihood schemes have to be implemented concurrently.

Of course, the magnitude of financial allocation earmarked for the purpose in the budget 2008-09 will be the ultimate testimony of the government’s commitment and seriousness to the cause of the poor. On the basis of the estimated fiscal costs we recommend that a total allocation of Rs56 billion be made in the budget for providing relief to the poor in 2008-09”.

Rs56bn relief for poor suggested -DAWN - Business; June 08, 2008

 

[Neo]

Government sets revised PSDP of Rs 523 billion​

* Federal Development Programme allotted Rs 373 billion
* Budget deficit all time high at Rs 957 billion​

ISLAMABAD: The government has decreased the size of the Public Sector Development Programme (PSDP) 2008-09 allowance by Rs 18 billion to Rs 523 billion during the meeting of National Economic Council (NEC), a senior official told Daily Times on Saturday.

The revised Public Sector Development Programme fund of Rs 523 billion against an earlier proposed allocation of Rs 541 billion is 8% higher than last year’s PSDP allowance of Rs 485 billion. The official said the decrease in the developmental programmes was due to the weak financial position of the country.

The Annual Plan Co-ordination Committee (APCC) in its meeting held on May 23-24 proposed Rs 541 billion PSDP 2008-09 for the NEC. Prime Minister Syed Yousuf Raza Gilani who chaired the National Economic Council meeting held on June 2 had also recommended Rs 541 billion to be allotted to PSDP for the year 2008-09. However, a reduction in PSDP fund by Rs 18 billion was taken later by economic managers, the official maintained.

FDP: The revised PSDP fund of Rs 523 billion allocates Rs 373 billion to the Federal Development Programme (FDP) and Rs 150 billion to Annual Development Programme (ADP) of all four provinces.

The federal component of the PSDP is sub-divided to allot federal ministries Rs 233 billion, Special Areas (AJK, FATA, Northern Areas) Rs 26 billion, Special Programmes (KPP plus others) of Rs 63 billion and corporations (WAPDA, NHA) Rs 51 billion. The operational shortfall of federal PSDP is set at Rs 50 billion, previously set at Rs 25 billion.

The government has also recommended an allocation of Rs 27 billion for Earthquake Reconstruction and Rehabilitation Authority (ERRA) to carry out its operation in earthquake-affected areas in NWFP and Azad Jammu Kashmir in the next fiscal year 2008-09, but has not included this in the size of PSDP fund.

The broad sectoral distribution of federal PSDP allows Rs 166 billion or 45% for the infrastructure development, the social sector has been given highest priority with an allocation of Rs 188 billion, or 51% of the fund, while other departments (Agriculture, Industry, Minerals) have been allocated Rs 17 billion.

Budget deficit: The total budget deficit is projected to rise to an all time high of Rs 957 billion during the current fiscal year as compared to the budget deficit’s actual projection of Rs 400 billion.

Extra expenditures of Rs 522 billion not budgeted by the previous government is the main reason for the unprecedented increase in budget deficit for the outgoing fiscal year 2007-08. The present government is taking various steps to bring down the budget deficit from Rs 957 billion to Rs 600 billion by reducing its expenditure.

Daily Times - Leading News Resource of Pakistan

 

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Pakistan seeks $2 billion Saudi oil bail-out: Financial Times ​

KARACHI (June 08 2008): A leading international financial daily on Saturday said that Pakistan is to ask Saudi Arabia if it can defer payment for $2billion worth of oil imports as it grapples with a deteriorating economic situation undermined by global oil prices.

Quoting a government official, Financial Times said that prime minister Yusuf Raza Gilani is expected to push Pakistan's request in meetings with Saudi leaders including King Abdullah.

According to the newspaper, Western economists have said that Pakistan may have to raise domestic oil prices significantly if it wants to qualify for a crucial World Bank loan on $500million, currently under discussion. The newspaper also claimed that the World Bank is urging Pakistan to withdraw subsidies to oil consumers. "Independent economists say that while the World Bank's loan would be relatively modest, it would allow Pakistan to seek commercial loans from other sources," the newspaper said.

Business Recorder [Pakistan's First Financial Daily]

 

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14.11 million cotton bales target for fiscal year 2009 unlikely to be met ​

ISLAMABAD (June 08 2008): Non-availability of water for cotton especially in Punjab, risk of the furious attacks of mealy bug and cotton leaf curl virus (CLCV) and the shortage of pesticides in the domestic market has discouraged the farmers and the country may miss the production target of 14.11 million bales of cotton set for the next fiscal year by 10-15 percent, well-placed sources told Business recorder here on Saturday.

The government has set the target of 14.11 million bales on 3.20 million hectares for the coming fiscal year. In Punjab, 11 million bales, in Sindh 3 million bales and in NWFP and Balochistan the production of 0.1 million bales is expected.

The cotton production is decreasing every year as in 2006-07; it was 13 million bales whereas in 2007-08, it has been recorded 11.6 million bales. Sources said the damage caused by CLCV contributed in 2007-08 is about 60-67 percent while mealy bug 30-35 percent to the total loss.

While according to an estimate, the water shortage may increase further to 22 percent during 2008 as compared to the last year. It has been figured out that the cultivable land of around 22 million acres remains uncultivable due to water crisis.

"If the situation remains the same regarding non-availability of water and the absence of any resistible variety of cotton against mealy bug and CLCV, the production may be reduced by 10-15 percent", the sources said.

They said the private sector is involved in smuggling of substandard Bt cotton seeds from India and most of the farmers in Southern Punjab are making use of about 35-50 percent seeds and ultimately the production decreased. Due to increase in prices of sunflower oil in international market, the cotton growers are thinking to switchover from cotton cultivation to sunflower cultivation.

For the next fiscal year, the total consumption of cotton across the country is estimated to be 15.1 million bales. So, it is really indicative of the fact that the country will have to import around 1 million bales for 2008-09.

Business Recorder [Pakistan's First Financial Daily]

 

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Government working on broad-based industrial policy ​

KARACHI (June 08 2008): Federal industries and production ministry has been chalking out a broad-based industrial policy to address problems faced in the growth of industrial development, which contains short-, medium-, and long-term measures to explore import substitution to boost export and bridge the gap of trade deficit.

About problems in the small and medium enterprises (SMEs), there is a lack of infrastructure in the way of SMEs development. For this, the ministry has held meetings with the international donor, ie the Asian Development Bank (ADB) for the establishment of internationally recognised accredited microbiology testing lab, accredited chemical testing lab and accredited footwear-testing labs.

The ministry provided recommendations to the Federal Board of Revenue (FBR) on customs duty relating to the industrial sectors ie other than food, textile and leather. The rationalisation of tariff structure for the competitive production of goods by the local industry is undertaken through budget exercise in the Engineering Development Board (EDB).

The exercise involves 17 to 18 committees on various sectors under the private sector stakeholders. The proposals emerging from these sectors are then analysed in the meeting of convene. The minister identified problems faced by industries in Pakistan as follows:

(i) Relatively narrow industrial base, (ii) low technology base, (iii) predominately low tech goods produced (around 90 percent), (iv) low value addition (textile and leather contribute 12 percent towards GDP), (v) inadequate infrastructure, (vi) multiplicity of procedures, taxes and regulations, (vii) absence of linkages between industry and academia/research institutes, and (viii) security and governance issues.

The ministry identified existing potential areas for investment includes engineering goods industry and services, machine tool, energy equipment, telecommunication, basic industries of forging, castings and foundry work, automobiles, marble, ceramic and stones development, plastic and chemicals, paper and paper board, glass and basic metals offer high potential for industrial development.

The strategies/recommendations of the ministry to address these problems includes (i) reforms in fiscal regime through tariff relaxation/rationalisation, (ii) growth of large scale and hi-tech anchor/main industries, (iii) high incentives for project requiring higher capital investment, long gestation periods, and higher level of technology, (iv) expansion of macro, small and medium enterprises, encourage projects that result in transfer of technology,(v) implement intellectual property rights laws, (vi) develop and implement strategies for rural industrialisation. (vii) reduction in cost of doing business, (viii) establishment of industrial parts/clusters, (ix) quality human resources, (x) development linkages between industry, academia and research institutions, (xi) mandatory certification and accreditation, and (xii) introduction of productivity enhancing reforms.

Business Recorder [Pakistan's First Financial Daily]

 

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Wapda focusing on hydel power: Raghib ​

LAHORE (June 08 2008): Member Water and Power Development Authority (Wapda) Syed Raghib Abbas Shah has said that Wapda is focusing on hydel power which is environmentally clean and our country has the potential to generate power of more than 50,000 MW and we have utilised only 6,484 MW up till now.

He said this while addressing a seminar on World Environment Day with the theme of "Kick the habit, towards a low carbon economy." organised by Pakistan Engineering Congress here on Saturday. He also said Wapda is building Allahi Khawar, Khan Khawar, Duber Khawar, Jinnah and Satpara Hydel Power Projects, which would produce 434 MW of carbon free hydel power.

He further said that studies are going on for producing 20,000 MW of hydel power project and next year starting the 4,500 MW Diamir Bhasa hydel power project and after this a series of run off hydro power projects would be built.

He also said carbon dioxide contributes about 55 percent to global warming produced from human activities and we have to produce energy from alternative sources such as solar energy. Pakistan has blessed with abundant sunshine so we have to develop solar energy and some villages in Balochistan and Swat have been electrified as power projects.

He said that the engineers have to design the machinery and devise mechanism which produces minimum carbon. Preservation of environment, sustainable growth poverty eradication is our responsibility.

Earlier, President Engineering Congress Engineer Hussain Ahmed in his well come address said that Pakistan needs to develop its own national goals and plans to reduce green house gas emissions. It was encouraging that the government had already taken initial steps in this regard and we hoped that new government will show more commitment to this cause. The seminar was also addressed by Manager Technical Enercon and ECF Asif Masood and Chief Engineer (WRPO) Wapda Dr Allah Buksh Sufi.

Business Recorder [Pakistan's First Financial Daily]

 

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Saudi Arabia to help improve oil reserves: Zardari ​

JEDDAH (June 09 2008): PPP Co-Chairman Asif Ali Zardari Sunday said the country's security, economy and democracy were the top priorities of PPP government and it was working on an incentives package for under-privileged section of the society. The PPP Co-Chairman, in an informal chat with the newsmen here, blamed mismanagement and bad policies of the last decade as main reasons leading to the current economic crisis.

Zardari, who is accompanying Prime Minister Syed Yousuf Raza Gilani in his visit to Saudi Arabia, said Saudi Arabian leaders have always been generous to Pakistan and they always think for protecting the interests of Pakistan.

He said the visit of Prime Minister Gilani to Saudi Arabia will help give new dimensions to our ties with the Kingdom in long way, adding, Saudi Arabia would help Pakistan for improving its strategic oil reserves to make them permanent.

Zardari said the consumer financing brought a negative impact on the society. It also resulted in increased street crimes.

He questioned that when country is facing challenges on its border then how the law and order situation could be improved within minimum time.

Zardari said, "In Pakistan's environment, we have to see many things, but it does not mean that we have any fear from anyone or in any matter. We are only concerned about 160 million people, who are leading a hard life."

The PPP Co-Chairman said the government would provide relief ranging from Rs 1000 to Rs 1500 to the poorest of poor in the forthcoming budget to improve their buying power and assured that it would be doubled within one year.

Turning to the political situation of the country Zardari said the PPP does not acknowledge Pervez Musharraf as a constitutional President, adding, but as by default or circumstance he (Musharraf) occupies a certain position, the government was working with him.

"Since we have to run the affairs of the state, we have a working relationship with the President", he added. He said, "We have put aside our personal likes and dislikes, as we neither give advantage nor disadvantage to anyone" Zardari said the PPP has never supported any dictator, "neither in the past nor it will do so in future."

He said PPP had never sought support of the dictators to come into power and has always worked for real democracy. He said his party does not believe in having relations with personalities but working for the improvement of collective political system and strengthen institutions.

Regarding budget deficit the Co-Chairman PPP said the government will take stringent measures to overcome this deficit and would never indulge in the blame game. Regarding the strategy of the government on improving trade balance, he said all options would be utilised in this regard. He said the government would make all out efforts to capture 1.2 billion dollars Indian market for this purpose. He said Pakistani leadership including himself will visit India in the near future to achieve this goal.

Zardari said Pakistan is an Agrarian society but unfortunately all the governments except PPP governments had neglected this sector and negative impact of this negligence are now coming out.

He expressed the confidence that the PPP-led coalition government would again give top priority to the development of the agriculture sector to overcome the food crisis.

On the judges issue, he said there are some differences between the coalition partners on the modalities of restoration of judges to resolve the issue, adding, but the PPP believes in the independence of judiciary and empowerment of Parliament. Asif Ali Zardari has extended his stay in Saudi Arabia for further talks with the Saudi leadership.

Business Recorder [Pakistan's First Financial Daily]

 

[Neo]

1000-megawatt power from Wapda can end Karachi load shedding ​

Monday, June 09, 2008

KARACHI: Karachi Electric Supply Company (KESC) has not been warned by the ministry of water and power for improvement of power supply in the city, an official said.

The power load shedding in the metropolis could be ended with 1000-megawatt power supply from Wapda, KESC official said.

According to sources, Federal Minister for Water & Power Raja Pervez Ashraf had issued a written warning to KESC yesterday to improve its performance.

The utility was provided several concessions and more time for payment of arrears but the power supply in Karachi could not be improved.

Managing Director KESC Amjad Hussain talking to Geo News said the company has not received any notice from the ministry adding that the federal government was aware about the power generation problems of KESC.

“Six units of Bin Qasim Power Plant have completed their period, while SITE and Korangi thermal power stations are not generating substantial power,” he said.

The load shedding can be completely brought to an end in the city with 1000-megawatt power supply from Wapda, he added.

According to Wapda Spokesman Basharat Cheema, Wapda was supplying 600-megawatts power to KESC instead of the decided 500-megawatts.

1000-megawatt power from Wapda can end Karachi load shedding

 

[Neo]

Raise in workers' minimum wage and pension: five labour laws to be amended in budget ​

ISLAMABAD (June 09 2008): The government would issue Labour Laws (Amendment Bill 2008) in Budget 2008-09 to increase the minimum wage of the workers from Rs 4,600 to Rs 6,000 per month; minimum pension raise from Rs 1,500 to Rs 2,000; reduction in contribution payable by employers from 6 to 5 percent of the wages and withdrawal of exemption to the banks and banking companies vis-à-vis employers old-age benefits contributions.

Sources told Business Recorder on Sunday that the Finance Bill, 2008-09 would amend five labour laws in the upcoming budget. It included Provincial Employees' Social Security Ordinance, 1965; West Pakistan Industrial and Commercial (Standing Orders) Ordinance, 1968; Minimum Wages for Unskilled Workers Ordinance, 1969; Workers' Welfare Fund Ordinance, 1971, and Employees' Old-age Benefits Act, 1976.

Sources said the amendment to the minimum wages for Unskilled Workers Ordinance is required to increase the minimum wages of the workers to Rs 6,000 per month. Moreover, enhancement in minimum wage of the workers also requires amendments to the Provincial Employees' Social Security Ordinance (PESS Ordinance). Under the PESS Ordinance, workers employed on wages exceeding Rs 5,000 per mensem are exempted. With the increase in the minimum wages of the worker to Rs 6,000 per mensem, all workers will go out of the social security scheme and practically the whole scheme will become redundant.

The draft amendment Bill titled "Labour Laws (Amendment) Bill, 2008", containing amendments in laws was placed before the Cabinet on May 21, 2008. The cabinet constituted a committee comprising ministers for labour, defence, law and justice, PM's Adviser on Interior and Special Assistant to the Prime Minister to examine the amendments proposed in the Provincial Employees' Social Security Ordinance, 1965 along with other social security laws and formulate recommendations for incorporation in the Finance Bill.

The Committee deliberated in detail and took following decisions:

(1) Amendment in the Minimum Wages for Unskilled Workers Ordinance, 1969: The Cabinet has already approved the amendment to be introduced in the Minimum Wages for Unskilled Workers Ordinance, 1969 on May 21, 2008 to enhance the minimum wages of the workers from Rs 4,600 per month to Rs 6,000 per month as announced by the Prime Minister.

(2) W.P. Industrial and Commercial Employment (Standing Orders) Ordinance, 1968: The Committee approved the amendment required to be introduced in the West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance, 1968 to pay an amount equal to the wages of the workers during the period of suspension.

(3) Workers Welfare Fund Ordinance, 1971: The Committee agreeing with the proposal to include workers of commercial and services sector in the ambit of scheme, approved the amendment required to be introduced in the Workers Welfare Fund Ordinance, 1971.

(4) Employees' Old-Age Benefits Act, 1976: The Committee approved the following amendments:

(i) Enhancement of minimum pension from Rs 1,500 per month to Rs 2,000 per month, (ii) Computation of rate of pension, monthly wages will be calculated on the basis of wages on which contributions were paid during last twelve months, (iii) Reduction in insurable employment given in sub-section (2) of section 22 will not be allowed to the insured persons of the establishments registered on or after July 1, 2008, (iv) Reduction in rate of contributions payable by the employer from 6 percent to 5 percent of the wages, (v) Extension of application of the Employees' Old-age Benefits Act to all such establishments, which have five or more employees, and (vi) Withdrawal of exemption to the banks and banking companies.

(5) Provincial Employees Social Security Ordinance, 1965: The Committee approved enhancement of the wage limit from Rs 5,000 to Rs 10,000 per month for applicability of the Ordinance to the secured workers and computation of the contributions.

The Committee also approved reduction in the rate of contributions from 7 percent to 6 percent of the wages under the Employee' Social Security Ordinance, 1965.

Business Recorder [Pakistan's First Financial Daily]