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Pakistan's forex reserves fall below $11 bln

KARACHI, July 17 - Pakistan's foreign reserves fell $292 million to $10.83 billion in the week that ended on July 12, due to heavy outgoings for import payments.

According to official data, the State Bank of Pakistan said its reserves fell $371 million to $7.953 billion, while those held by commercial banks rose $79 million to $2.877 billion from $2.798 billion.

Pakistan's foreign exchange reserves hit an all-time high of $16.486 billion on Oct. 31, 2007, but have fallen since then because of rising oil payments and foreign investor's pulling money out because of political uncertainty dogging the country 3 � months after a civilian coalition formed a new government.

The central bank last week took steps to help stablise the rupee. The main measure was a temporary suspension of forward booking of foreign currency for all imports.

An assurance was also given that the central bank would provide foreign exchange to authorised dealers for all imports of furnace oil used for power plants. See [IDn:SIN48565]

Analysts said the country's total reserves were barely enough to cover the import bill for the next 3 months.

The central bank in May increased its key discount rate to 12.0 percent from 10.5 percent, to counter accelerating inflation and widening fiscal and current account deficits. Analysts expect the central bank to raise rates again in the coming weeks.

The rupee has depreciated 16.9 percent against the dollar since the beginning of the year and dealers said the outlook remains bleak.

Pakistan's forex reserves fall below $11 bln - Yahoo! Malaysia News
 
U.S. aid bill seeks to boost Pakistan civilian ties

WASHINGTON (Reuters) - Two senior U.S. senators on Tuesday unveiled a $7.5 billion, 5-year aid bill for Pakistan aimed at boosting civilian ties in an alliance heavily skewed toward a military fight against Islamic militants.

The legislation introduced by Democratic Sen. Joseph Biden of Delaware and Republican Sen. Richard Lugar of Indiana directs aid to development projects such as schools, roads and clinics and aims to make Pakistan's military more accountable for the billions in U.S. support it has been receiving since the September 11 attacks.

The bipartisan legislative move comes amid increasing attacks in Afghanistan blamed on militants based in Pakistan's border tribal belt, which is believed to be the sanctuary of al Qaeda head Osama bin Laden and key Taliban leaders.

Biden, chairman of the Senate Foreign Relations Committee, said the bill was designed to correct an "unsteady balancing act in one of the ... most dangerous spots in the world" that breeds recriminations in Washington and Islamabad.

"In the minds of many Americans, we've not gotten much for the billions of dollars we spent," he told reporters.

"And from the Pakistani perspective, America is seen as an unreliable ally who will abandon Pakistan the moment it's convenient to do so," Biden said, adding that Pakistanis resent what they perceive as a U.S. bias toward military rulers.

"GREAT INITIATIVE"

Lugar, the senior Republican on the committee, said the bill will help the United States seize on opportunities arising from the election in February of a civilian government that ended nine years of military rule in Pakistan.

"While our bill envisions sustained cooperation with Pakistan for the long haul, it is not a blank check," Lugar told reporters.

"It calls for tangible progress in a number of areas, including an independent judiciary, greater accountability by the central government, respect for human rights, and civilian control of the levers of power, including the military and intelligence agencies," he said.

Unveiled days before new Pakistani Prime Minister Yousaf Raza Gillani is due to visit Washington, the bill was hailed by Pakistan's U.S. envoy as a "great initiative" that would correct past errors and ease long-standing fears in Islamabad.

"A long-term commitment to Pakistan's security and territorial integrity will reinforce the commitment of the Pakistani people to fighting terrorism," Ambassador Husain Haqqani told Reuters.

The bill would triple nonmilitary aid to Pakistan to $1.5 billion annually in the 2009-13 fiscal years, while making military aid conditional on certification that Pakistani security forces were working to prevent al Qaeda and its allies from operating in Pakistan or launching attacks into Afghanistan from Pakistan's territory.

It would also expand U.S.-Pakistan dialogue beyond military leaders to civilians and shift an agenda dominated by security issues to textile and farm trade, visas and other matters of concern to average Pakistanis, the senators said.

State Department spokesman Gonzo Gallegos said the Bush administration would work with Congress to "establish a new framework for economic and security assistance that can support Pakistan's democracy, counter its terrorism threats and strengthen its development."

U.S. aid bill seeks to boost Pakistan civilian ties - Yahoo! News
 
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Trade policy sets $22.1 billion exports target

ISLAMABAD (updated on: July 19, 2008, 00:37 PST): The trade policy for the fiscal 2008-09 has set export target at US$ 22.10 billion enhancing 15% growth over last year’s exports and emphasised the need of taking effective measures to arrest growing gap in trade deficit affecting the economy.

Federal Minister for Commerce Chaudhry Ahmed Mukhtar announcing the new trade policy for 2008-09 here this evening attributed a number of unavoidable factors which raised the deficit gap to $20.7 billion.

He said “We have inherited a very difficult economic situation where the public is facing more hardships than it has in recent history. This was due to external and internal factors of the past year”.

Moreover, Commerce Minister said, the doubling of international oil prices from around $ 68 per barrel to $ 145 per barrel during the year and increase in international prices of food items, Pakistan needed to import during the year, especially wheat and edible oil enhancing the import bill.

“The total imports during the year 2007-08 amounted to $ 39.97 billion raising the trade deficit of $ 20.7 billion”, he added.

Mukhtar said government has evolved an Export Strategy for 2008-09 to overcome the shortcomings of the prevailing economic situation and trade imbalance by concentrating on taking corrective measures to enhance exports and check the import bill.

He said emphasis would also be laid on intensification of market intelligence gathering by Ministry of Commerce and TDAP regarding market opportunities, consumer preferences, quality and other standards, best practices by other countries and disseminate this information to our stakeholders.

He said “constant political instability sparked by judicial crisis in March 2007, law and order situation also assumed dangerous proportions in the form of Lal Masjid affair, the increase in frequency and lethality of terrorist bomb blasts and of course the state of militancy and insurgency in FATA and the NWFP and martyrdom of Mohtarma Benazir Bhutto on 27th December 2007 cast a long and dark shadow on the economic and political health of the country”.

Business Recorder [Pakistan's First Financial Daily]
 
Trade with India to benefit Pakistan: Mukhtar


ISLAMABAD (updated on: July 18, 2008, 23:05 PST): Federal Minister for Trade and Commerce Ahmed Mukhtar stressed the need for coming out of Indian phobia to reap maximum gains of bilateral trade between the two neighbouring countries.

“India is becoming important economic partner and trade with this country would be in the interests of Pakistan”, he said while addressing post trade policy 2008-09 press conference here at Prime Minister Secretariat.

The Federal Minister was of the view that trade with neighbouring countries including India would be very much cost effective as compared to trade with other countries.

The Commerce Minister said that there were certain trade barriers, hampering Pakistan to give India as the Most Favoured Nation (MFN) status while India has given the MMFN to Pakistan.

Mukhtar said that Pakistan has not changed its polices however added that everything is done through composite dialogue between India and Pakistan.

The Minister stressed the need for developing agriculture of the country, arguing that “Future is of the agriculture”.

Declaring China as most potential market for Pakistan’s exports, the Federal Minister called upon Pakistani exporters to explore the vast Chinese market for boosting country’s export.

He added that after the signing of the Free Tarde Agreement (FTA) with China the Pakistani exports have increased four times.

He said that the only way of stopping smuggling was to bring the commodities prices at the level of neighbouring countries, indicating that government would be increasing prices of diesel to check the smuggling of the item.

To a question, he said that Pakistani rice exports have increased to a considerable level as the exports of the commodity were recorded at US $ 1.9 billion during the last financial year.

He said that it was not easy to prepare trade policy in these hard times adding that financial situation was not favourable, however “we must not loose our heart and continue to make effort to overcome this challenge”.

Terming the export target of US $ 22.12 billion as realistic, he said that he was optimistic to achieve the target with ease.

To a question, he said that the Commerce Ministry never sets target for imports as prices in the international market remain unpredictable including that of oil.

Replying to another question regarding the provision of Research and Development Fund to textile sector, he said that he will be holding a meeting with the Prime Minister tomorrow to discuss the issue.

He assured the exporters of textile sector that efforts would be made to meet the demands of the sector for its promotion and benefit of the country.

Regarding the market access, he said that Pakistan has signed Free Trade Agreements (FTAs) and Preferential Trade Agreements (PTAs) with China, Malaysia, Iran Sri Lanka and Mauritius, while similar agreement would be signed with European Union the beginning of next year.

He added that initiation of Reconstruction Opportunity Zones (ROZ)s with USA would also facilitate the Pakistani exports to US markets.

The Commerce Minister said that last year Pakistan exported defence equipments worth US $ 63 million and expressed the hope that this year the country exports of the equipments would further increase after holding of the “Exhibition IDEA”.

Business Recorder [Pakistan's First Financial Daily]
 
Trade Policy: $22.1 bn export target set for 2008-09
Friday, July 18, 2008

ISLAMABAD: Government has set the export target for the fiscal year 2008-09 at 22.1 billion dollars, showing an increase of 15 percent.

Federal Minister for Commerce, Ahmed Mukhtar stated this while presenting trade policy for the fiscal year 2008-09 which he said aims at encouraging industrialists, investors and traders in the country.

The Federal Export Promotion Bureau will be reconstituted under the supervision of the Prime Minister with an aim of enhancing exports while necessary changes will be introduced in Trade Development Authority, he said.

Programmes will also be initiated to train the human resource for enhancing the productive capacity of industries.

In order the reduce the cost of doing business imports of plants, machinery and raw materials have been made duty free under Duty and Tax Remission for Exports scheme.

The Commerce Minister said export target was achieved last year despite uncertain political situation and fragile law and order. Slow down in US economy and decline in foreign capital markets also affected the exports of Pakistan.

Industrial zones will be established in different cities for industrial development and creation of employment opportunities.

He said Hilal Certification Board will be set up for promotion of ‘hilal’ products’s exports.

Trade Policy: $22.1 bn export target set for 2008-09
 
Forex reserves dip to $10.83bn

Friday, July 18, 2008

ISLAMABAD: Pakistan’s foreign currency reserves fell further to $10.83 billion against $11.12 billion the previous week, the central bank said on Thursday.

Reserves fell below $11 billion mark on July 12 and reached $10.83 billion compared to $11.12 billion the previous week. If the situation does not improve on the external front, there will be a possibility of approaching the IMF again during the current fiscal year.

Foreign exchange reserves held by the central bank stood at $7.95 billion compared to $8.32 billion in the previous week. The foreign exchange deposits held by banks were $2.88 billion compared to $2.80 billion the previous week.

Foreign currency deposits held by banks are included in the calculation of the country’s total reserves, which have fallen from a record $16.39 billion in early November 2007. It shows that the foreign reserves were depleting rapidly and had dropped by over $6 billion in the last eight months.

“The reserves are depleting rapidly, ultimately putting pressure on Pak rupee,” an official in the finance ministry told The News. The country’s reserves are decreasing owing to growing imports especially the surge in oil prices in the recent past, causing vulnerabilities on the external front of the national economy.

Official sources said that the rapid depletion of reserves was quite disturbing for the economic managers as on one side the external debt surged and touched $46 billion while on other side the precious reserves declined from $16 billion to just over $10 billion in recent weeks.

Pakistan’s foreign debt also swelled by $10.5 billion in the last six years and now stands at $45.9 billion at a time when the reserves are depleting more rapidly.

The foreign currency reserves stood at $14.08 billion on Feb 15, 2008. The reserves position was much better a few months back as they stood around $16.4 billion during Oct 2007. It showed that the reserves declined by around $6 billion in the last few months.

Forex reserves dip to $10.83bn
 
Pakistan, WB in talks on funding package

Friday, July 18, 2008

WASHINGTON: The World Bank is in talks with Pakistan on a broad economic package that could include government-agreed reforms and financing by the bank to stabilise the economy, a bank official said on Wednesday.

Rob Floyd, the World Bank’s program manager for Pakistan, denied media reports that the development lender had approved a $500 million emergency loan for Pakistan, which like other developing countries faces budget constraints due to soaring fuel and food prices.

“The World Bank has been in discussions with Pakistan on a stabilisation package that may include reforms from their side and financing from ours, but we have not come to closure on that,” Floyd told Reuters.

He said discussions had been under way for several months.

Media reports said the $500 million was agreed in talks between the World Bank and Pakistan’s finance minister Naveed Qamar in Islamabad on July 14, and would be considered by the bank’s board in August. The loan would help restore confidence in Pakistan following months of political turmoil.

Pakistan’s new civilian government is under pressure to deal with slowing economic growth, inflation that is running at over 20 per cent, exchange rate instability, and dwindling currency reserves.

Faced with a dire situation, the new government, which took over after eight years of military rule under President Pervez Musharraf in March, is banking on budget support from foreign and multilateral lenders to help it cope.

Decision-making in Pakistan was paralysed during the last months of Musharraf’s government, and during a caretaker administration that held the reins until the new civilian government was formed after an election in February.

Pakistani Prime Minister Yousuf Raza Gilani said on July 1 the government wouldn’t flinch from unpopular measures to put the economy on sounder footing, including raising gas prices and phasing out subsidies entirely.

Pakistan, WB in talks on funding package
 
Oil import bill surges by 55pc to $11.38 billion

ISLAMABAD, July 17: Pakistan’s oil import bill surged to $11.38 billion in 2007-08, up by more than 55 per cent over the $7.33 billion a year before, mainly due to higher international prices and increased consumption.

Official figures released by the Federal Bureau of Statistics for the year suggest that Pakistan had to pay $4 billion (Rs270 billion) more in financial year 2007-08 than in the previous year. The oil import bill was 55.14 per cent higher than in 2006-07 in value terms.

The import of petroleum products in 2007-08 cost $6.158 billion against $3.73 billion in 2006-07, showing an increase of 65 per cent, while crude imports surged to $5.22 billion, an increase of 45 per cent over the figure of $3.6 billion in 2006-07. The consumption of petroleum products was up about 19 per cent in 2007-08 and stood at 10 million tons compared with 8.6 million tons in 2006-07. Likewise, crude imports stood at 8.6 million tons compared with 8.2 million tons in 2006-07, showing a 5.2 per cent increase in consumption.

The government had estimated the oil imports to stay at $8.8 billion in the 2007-08 budget. But it had to pay about $2.6 billion (Rs170 billion) more than the budget estimates because the estimates had been based on an expected international crude price of $70 per barrel.

Petroleum emerged as the largest contributor to the country’s total import bill of $39.97 billion in fiscal year 2007-08.

This was followed by machinery group with imports at $7.4 billion, which was 10.32 per cent higher than the $6.7 billion machinery imports in 2006-07. This included $2.2 billion imports of telecom sector, including mobiles phones, and $1.18 billion of power generating machinery.

Agriculture sector imports stood at $5.83 billion in 2007-08, showing an increase of 32 per cent from the $4.4 billion in the previous year.

Fertiliser imports in the agriculture sub-sector were up by 98 per cent and stood at $890 million compared with $450 million a year ago while import of plastic materials stood at $1.3 billion, showing an increase of about 14 per cent.

The food sector stood fourth in 2007-08 as food imports increased by 53.5 per cent to $4.64 billion compared to $2.74 billion in 2006-07.

Palm oil imports stood at $1.6 billion in 2007-08, which was 76 per cent higher than $900 million in 2006-07.

Transport sector’s imports in 2007-08 amounted to $2.25 billion, showing a decline of 6.04 per cent, compared with $2.4 billion in 2006-07.

The import of metals stood at $2.54 billion, compared with $2.34 billion of the previous year, showing an increase of 8.4 per cent. Textile imports stood at $2.35 billion in 2007-08 against $1.57 billion a year before, showing an increase of about 50 per cent.

Oil import bill surges by 55pc to $11.38 billion -DAWN - Top Stories; July 18, 2008
 
Investors’ protest takes heavy toll of stock market

Friday, July 18, 2008

KARACHI: Apparently, not a single sign of recovery was seen at the Karachi stock market on Thursday, at the fifteenth consecutive bears-run session. Distraught small investors protest, however, compelled players of the market to buy shares on the day dips.

KSE 100-share index lost another 279 points or 2.66 per cent to end at 10,213. Turnover in the ready market remained sluggish at 89.534 million shares amid wiping out another Rs79 billion from overall market capitalisation that fell to Rs3.192 trillion.

Saad bin Ahmed, Head of Research at Capital One Equity, said the market closed just above the first support level of 10,200 points after touching 10,045 points intra-day low hit in the closing hours.

One cannot confidently say whether the market would retain this level or not in the coming sessions. The movement at the local bourse depended on the decisions to be taken by the market regulators and their successful implementations, if small investors agree on the set terms and conditions, another analyst said.

Ahmed, however, believes that if KSE officials fail to provide a safe exit to small investors then the situation may remain gloomy in coming days.

The second support level in market, he calculated, might be found at 9,700 points level if the day (Thursday) closing level did not continue reverting back to a positive territory. As a matter of record, 100-index has lost approximately 35 per cent or 5,463 points to date from all-time high closing of 15,676 points of April 18. Therefore, the parallel running 30-index posted a fresh decline of 388 points or 3.28 per cent to 11,456 points. Some fourth stocks closed at their lower circuit breaker of five per cent or Re1 in 100-index while ten of them closed on the positive note.

Pakistan State Oil and Pakistan Telecommunication Company were prominent among the positive closing stocks. However, Oil and Gas Development Company, Pak Petroleum, Pak Oilfields, MCB Bank, National Bank, Habib Bank, Standard Chartered Bank and JS Co remained the day big contributors of points in negative in the chief 100-index. Each of them shed in range of 10 to 30 points.

Hasnain Asghar Ali at Aziz Fidahusein said that panicked by further decline in the rupee value, the market continued to melt, although institutional buying was witnessed in E&P sector, the support was certainly not expected to change the sentiment, as the participants have lost confidence in the authorities.

The emergent meeting of the brokers was called after a dramatic (planned) protest and the proposal most debated and likely to be accepted will be freezing the lower lock at zero per cent.

Post meeting efforts were made to pull the value stocks mainly in E&P. It is a common feeling that whatever proposals are being made or ignored are generally biased or not in the vested interest of some the bias has therefore pulled element of conviction out of the proposals, due to which things fail to materialize, Ali added.

The negative sign continued to dominate on board, as 201 stocks fell in red against mere 42 stocks closed on positive note. The value of 23 stocks remained unchanged with total 266 active counters on board. Highest volumes were witnessed in NIB Bank at 11.377 million closing at Rs8.65 with a loss of five paisa, followed by Hub Power at 10.028 million closing at Rs14 with a loss 60 paisa, Oil and Gas Development Company at 4.377 million closing at Rs105.50 with a loss of Rs1.38, TRG Pakistan at 3.854 million closing at Rs4.68 with a loss of four paisa and Zeal Pak at 3.780 million closing at Rs1.52 with a loss of 19 paisa.

Investors’ protest takes heavy toll of stock market
 
Hydropower generation

NEPRA develops mechanism to attract investment​

Friday, July 18, 2008

ISLAMABAD: The National Electric Power Regulatory Authority (NEPRA) has developed a mechanism to attract private sector investment in the field of hydropower generation.

The private sector in the past has been reluctant to invest in hydropower projects in view of uncertainty of costs associated with geological surprises, environmental issues including resettlement problems and long gestation period.

In order to resolve these difficulties and promote hydropower projects, NEPRA has now assured the investors to provide them cost adjustments at engineering, procurement & construction stage.

According to NEPRA here on Thursday, it has also approved to determine the tariffs for hydropower projects on the basis of feasibility report approved by the Private Power Infrastructure Board (PPIB) and its panel of experts.

The new mechanism has been developed after comprehensive consultations with potential investors as well as relevant government agencies.

After the development of mechanism for tariff determination, an application for determination of tariff for 840MW power project (Suki Kinari Hydropower Project at Paras Village of the Kunhar River, District Mansehra, (NWFP) has already been submitted to NEPRA).

It is hoped that the new tariff mechanism will encourage other potential investors who also want to come for hydropower generation.

Hydropower generation
 
Official claims big rise in arms exports

ISLAMABAD, July 17: Pakistan’s defence exports have tripled to around $300 million because of the quality of its ammunition, anti-tank guided missiles, rocket launchers and shoulder-fired surface-to-air missiles.

“Our defence exports have been rising substantially because the arms and ammunition we manufacture meet international standards,” Maj-Gen Mohammad Farooq, Director General of the Defence Export Promotion Organisation (Depo), told Dawn.

“We even won a contract in the face of tough competition from developed countries to manufacture parts of Boeing aircraft,” he said.

Although he wasn’t precise about earnings from arms exports, he said: “It has tripled and it is very good for Pakistan.”

He said arms trade was a complex business and it had to be on a government-to-government basis. Pakistan was answerable to the international community in terms of ensuring that the arms did not fall into wrong hands.

He said exports to South Asian, Middle Eastern and African countries had increased significantly.

He said there was a time when the country’s defence industry exported only small arms and ammunition, but now their range had diversified and developed countries were also purchasing Pakistan’s military hardware.

He said optical instruments like night vision devices, laser range-finders and designators, laser threat censors, artillery armour mortars and ammunition, mine detectors, anti-tank rifles, missile boats, different types of tear gases, fuses of unarmed vehicles, security equipment and sporting and hunting guns were also being manufactured in Pakistan.

“The fuses are being purchased by countries like Italy, France and Spain,” he said.

He said army tents, uniform and other equipment were also being exported.

In reply to a question, Maj-Gen Farooq said Pakistan was manufacturing Al Khalid tank. “Due to logistic reasons, we cannot export this tank but its parts are being exported.”

He said the country was phasing out old T-59 tanks by upgrading them to Al Zarar or replacing them with Al Khalid tanks.

The Depo chief said Pakistan had entered into partnership and out-sourcing programmes with several countries.

There was collaboration with China for building an air-defence system and manufacturing of Karakoram-8 and JF-17 Thunder, a multi-role modern fighter aircraft, he said.

The Depo chief said there was a joint venture with South Korea’s Poongsan company for manufacturing improved artillery ammunition. There was cooperation with France’s Nexter company to increase the range, accuracy and effectiveness of different weapons.

“France is also helping us make JF-17 Thunder aircraft and Al Khalid tank more useful by equipping them with advanced avionics,” he said.

He said Pakistan had built Agosta submarines and Puma and Ecureil helicopters with the help of France “with transfer of technology”.

He said collaboration with the United States had increased in manufacturing armoured personnel carriers with transfer of technology.

In reply to a question, he said, Pakistan’s military exports were higher than India’s. “Indians started working on Arjun tank but, they are yet to induct it in their army, while Pakistan has built and handed over Al Khalid tank to the army, although it started the programme later,” he said.

The News International - No. 1 English Newspaper from Pakistan - Saturday, December 30, 1899
 
Cement exports set to touch $1bn

KARACHI: Pakistan cement exports after earning a historical level of $435 million foreign exchange during financial year 2007-08, is all set to touch one billion dollar mark by 2010, industry sources told Daily Times Thursday.

During fiscal year 2007-08, country exports stood at 7.712 million tones ($435 million) and Pakistan has already established its position as an exporter of cement and clinker in the region, sources added. Sources said the industry projections suggested that the cement industry exports would reach to $735 million by the end of 2008-09 and it would touch $1.043 billion by the end of 2009-10.

Pakistan’s cement industry started exporting cement in the year 2001 and it has increased its compatibility gradually, as significant improvement has been taking place with every passing day.

Cement industry’s installed capacity had more than doubled during the last five years, which helped the industry to touch all time high dispatch mark during the last fiscal year, they said.

The cement industry in Pakistan has expanded capacity from 17.8 million metric tonnes in 2003 to 39 million metric tonnes in 2008 and is expected to rise further to 50 million metric tonnes in 2010. They said the cement manufacturers were enhancing their role among competitors and at present, regional countries were facing huge shortage of cement, which had played a key role in achieving landmark cement exports during the last fiscal year.

“During the last fiscal year, strong external demands from the Gulf countries have continued pushing local companies to invest more in the cement sector, besides utilising their maximum capacity to meet international demand,” they said.

Pakistan has been exporting cement to Middle East, India, Afghanistan, Central Asian States, South Africa, Switzerland, Sudan, Egypt and Iraq. Some more destinations are likely to add up in the next two years, thus helping the cement industry to touch the level of one billion dollars accordingly. The industry circles have pointed out that the industry has achieved this startling exports level single-handedly and no tangible policy support from the government has so far been extended to the cement exporters. According to them, the cement industry could boost the exports further in case government comes up with appropriate infrastructural measures.

Daily Times - Leading News Resource of Pakistan
 
Cement manufacturing, marketing cost spiked by 64.5 percent

KARACHI: The cost of manufacturing and then marketing the cement has risen by Rs 147 per bag, or 64.50 percent, since June 2007, the representatives of cement industry have told the high ups of Ministry of Industries in a recent meeting in a bid to justify their price increases.

In a recent presentation to the Ministry of Industries they said the cost has reached Rs 375.60 per bag in 2008 comparing with Rs 228.21 per bag in 2007. Industry sources told Daily Times that the industry representatives briefed the Ministry high-ups about the impact of unprecedented increase in cost of production, taxes, freight and other charges over the last one year. The cost to make and sell cement consists of two components: cost of production and taxes/freight/commission charges.

While cost of production has risen by Rs 106.64 per bag, the cost under the heads of taxes/freight/commission charges has risen by Rs 40.77 per bag from June 2007 to June 2008, say the industry sources. The cost of production includes cost incurred on raw and packing material, fuel and power, stores & spares, salaries and wages, depreciation, financial charges, administration, selling charges and other operating expenses. The cost of raw and packing material has increased to Rs 27.79 per bag in June 2008 from Rs 18.27 per bag in June 2007. The cost of fuel and power has increased to Rs 152.28 per bag in June 2008 from Rs 65.70 per bag in June 2007.

Daily Times - Leading News Resource of Pakistan
 
Plan to attract investment in hydropower generation

ISLAMABAD, July 17: The National Electric Power Regulatory Authority has developed a mechanism to attract private sector investment in the field of hydropower generation.

The private sector in the past was reluctant to invest in the hydropower projects in view of uncertainty of costs associated with geological surprises, environmental issues, including resettlement problems and long gestation period.

The regulatory authority has now assured investors to provide them cost adjustments at engineering, procurement and construction stage.

The regulatory authority has also approved to determine tariffs for hydropower projects on the basis of feasibility report approved by the Private Power Infrastructure Board (PPIB) and its panel of experts.

After the development of mechanism for tariff determination, an application for determination of tariff for 840 MW power project (Suki Kinari Hydropower Project at Paras Village of Kunhar River, District Mansehra, (NWFP) has already been submitted to the authority.—APP

Plan to attract investment in hydropower generation -DAWN - Business; July 18, 2008
 
Non-textile exports up 40pc at $8.659bn

ISLAMABAD, July 17: Textile and clothing exports dipped by 2.5 per cent to $10.561 billion in 2007-08 from $10.787 billion over the same period last year, the Statistics Division’s data revealed on Thursday.

Despite the overall dismal performance of textile and clothing sector, the export target of $19.2 billion was achieved during the year under review on the back of unexpected growth in exports of non-textile products.

The non-textile products export edged up by 39.9 per cent to $8.659 billion from $6.189 billion of last year. The export proceeds of the year under review rose by $2.24 billion over the last year, which was actually the growth in non-textile products exports.

Of the non-textile products, export of rice went up 61.53 per cent, petroleum products 40.06 per cent, sports good up by 4.23 per cent, leather manufactures 24.05 per cent, footwear 8.21 per cent, engineering goods 42.54 per cent cement 181.69 per cent.This shows the natural diversification of exports base as now the share of textile and clothing in total exports declined to 55 per cent in the year under review from 64 per cent last year despite dolling out billions of rupees subsidies to the sector.

While the share of non-textile products soared to 45 per cent in 2007-08 from 36 per cent last year without having any financial support or package from the government.

Analysts said it shows that subsidies are not the real issue but there is a need to address the issue of structural weaknesses in the textile sector. This means that the production capacity of textile sector has also reached a saturation point, they said.

With the exception of raw cotton and other textile material, all other major components of textile manufactures registered negative growth in the year under review. This declined occurred despite the fact that rupee also depreciated more than 20 per cent during the year while the currencies of the competitors countries like India, China appreciated tremendously.

In addition, the deteriorating law and order situation also resulted in reported diversion of export orders to other countries.

Product-wise details showed that export of readymade garments declined by 3.16 per cent to $1.498 billion in the year 2007-08 from $1.547 billion last year, cotton yarn by 9.37 per cent to $1.294 billion from $1.428 billion, bedwear by 5.43 per cent to $1.887 billion from $1.995 billion and cotton cloth 4.64 per cent to $1.932 billion from $2.026 billion, respectively.

However, the export of knitwear was up marginally by 1.82 per cent to $1.831 billion from $1.789 billion, raw cotton 38.85 per cent to $69.737 million from $50.226 million, towels 0.77 per cent to $615.415 million from $610.712 million, art, silk and synthetic textile 16.74 per cent to $489.982 million from $419.724 million, made up articles 4.24 per cent to $536.114 million from $514.313 million and other textiles 12.25 per cent to $274.001 million from $244.100 million, respectively.

And export of cotton carded declined by 21.76 per cent to $12.320 million from $15.746 million and yarn other than cotton yarn 27.06 per cent to $49.162 million from $67.397 million during the year 2007-08 over the last year.

Non-textile exports up 40pc at $8.659bn -DAWN - Business; July 18, 2008
 
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