Pakistan Economy - News & Updates - Archive

[Neo]

ADB report terms TAP gas pipeline a viable project ​

Friday, November 28, 2008

ISLAMABAD: After full backing of USA, the Asian Development Bank (ADB) has found Turkmenistan-Afghanistan-Pakistan (TAP) gas pipeline, as economically and financially viable project in its Technical Report (TA) but the Turkmenistan government has not yet completed evaluation and certification of the recoverable gas reserves at the Dauletabad field.

According to TA report of the ADB on TAP project, available with The News, the Government of Turkmenistan is financing an evaluation and certification of the recoverable gas reserves at the Dauletabad fields and a technical audit of its gas production and processing facilities.

The USA is sternly opposing any move to go ahead with Iran Pakistan India (IPI) gas pipeline and Washington is pursuing Islamabad and New Delhi to adopt TAP as alternate to TAP project.

The Turkmenistan-Afghanistan-Pakistan Natural Gas Pipeline Project consists of a gas pipeline of about 1,700 kilometers that can transport up to 20 billion cubic meters of natural gas annually from the Dauletabad fields in southeast Turkmenistan to consumers in Afghanistan, Pakistan, and possibly India.

The final report found helpful in establishing the basic parameters of the pipeline. It concluded that the Project was economically and financially viable based on certain gas pricing assumptions and a number of scenarios and sensitivities.

In particular, the Final Report (i) selected a preliminary pipeline route, (ii) presented the pipeline design parameters that were considered reliable and safe, (iii) produced an environmental and social assessment of the southern route selected by the three participating countries for further study, and (iv) prepared analyses of financial and economic viability of the Project.

ADB fulfilled its role as an active development partner helping mobilise necessary technical and financial resources for the Project.

In May 2002, the heads of state of Afghanistan, Pakistan, and Turkmenistan met in Islamabad and announced the formation of a coalition for implementing the Project.

At its first meeting in Ashgabat in July 2002, the Steering Committee requested the Asian Development Bank (ADB) to play the role of a development partner and to provide regional technical assistance for feasibility studies of the Project.

The Project has significant potential for enhancing stability and improving living standards in South and Central Asia. It will be a pioneering effort in linking the energy-deficit economies of South Asia to the hydrocarbon-rich Central Asian countries. —MH

 

[Neo]

Pakistan lacks features for high growth: report ​

Friday, November 28, 2008

LAHORE: Thirteen economies that registered sustained average growth of seven per cent for 25 years after 1950, maintained macro-economic stability, mustard high rates of saving and investment, had creditable, capable and committed government that let markets allocate resources.

The World Growth Report points out these common features among the high growth economies. Pakistan unfortunately lacks these attributes needed for high growth and automatically leads to inroads in the global markets.

The economies that attained high, sustained growth in the post-war period include Botswana, Brazil, China, Hong Kong, China, Indonesia, Japan, the Republic of Korea, Malaysia, Malta, Oman, Singapore, Taiwan, China, and Thailand. Two other countries, India and Vietnam, may be on their way to joining this group the report adds.

A growing GDP is evidence of a society getting its collective act together. As its economy grows, a society becomes more organised, more densely interwoven. A growing economy is one in which energies are better directed, resources better deployed, techniques mastered and then advanced. It is not just about making money. A selected few in Pakistan are making huge money but the society is neither organised nor densely interwoven.

These economies opened up to global economy and imported knowledge, ideas technology and know how from rest of the world. They then exploited global demands which provided a cheap elastic market for their goods. They imported what the rest of the world knew and exported what it wanted.

Pakistan’s economy for decades has been based on the concept of protecting the domestic industries from competition. There was no emphasis on import of technology rather obsolete technology was allowed in the country for substituting imports through protection. This technology produced products that could only be used in Pakistan but could not be exported as the world had gone much ahead. We are producing cars from the small plants long abandoned in developed countries as they were too small and could not compete with the larger plants having economies of scale 100 times higher. After more than two decades of protection we can not export cars due to this inefficiency.

The four Asian tigers, on the other hand, increased their manufactured exports from $4.6 billion (2000 dollars) in 1962 to $715 billion in 2004. If there was any small decline in price, it was overwhelmed by the vigorous growth in sales. Governments in successful were also fiscally responsible. Many ran budget deficits for extended periods; some nursed high ratios of debt to GDP. But this public debt did not get out of hand, not least because the economy grew faster than the stock of public liabilities. Pakistani governments are not fiscally responsible and run unmanageable budget deficits and debt to GDP ratios.

All high growth economies were “future-oriented,” forgoing consumption in the present in pursuit of a higher level of income in the future. China has saved more than a third of its national income every year for the past 25 years. India has reached the same saving level of 34 per cent while Pakistan’s saving rate is almost half.

A country’s comparative advantage will evolve over time. In any period of fast growth, capital, and especially, labour moves rapidly from sector to sector, industry to industry. This mobility of resources was a feature of all the 13 high-growth cases. Governments did not resist (although they may have tempered) the market forces that pulled people into urban areas or destroyed some jobs, while creating others. Pakistani governments have been trying to shield its most inefficient industries. Sugar industry survived on this protection but is still not efficient enough to go in to global market.

 

[Neo]

JP Morgan outsources brokerage business ​

Friday, November 28, 2008

KARACHI: JP Morgan, one of leading US Banks, has temporarily outsourced its brokering business in Pakistan owing to slowdown in local economy and maintenance of floor at local bourses since August 27, this year.

One of JP Morgan’s official at Karachi office dispelled the impression that his Company was winding up its complete business in Pakistan and replied on phone that the Company was just outsourcing its brokering business for the time being here and would continue to deliver services to its brokering clients too.

He maintained that the Company would continue to run the other two businesses at city office i.e. Treasury Services and Investment Banking. “We want to give complete attention to our ‘Treasury Services’ when floor is in place at bourses since long,” he added.

J.P. Morgan would maintain its KSE membership card, which it purchased in 1996 and would resume delivering brokering service when the economic conditions and business sentiments at bourses are improved, he added.

Earlier, Company resumed its operations in Pakistan in early 2007 after a gap of five years in complete suspension. Prior, J.P. Morgan has closed its equity trading business in Pakistan sometime in 2001 as the Company was getting consolidated.

 

[Neo]

Govt to issue LoS for 1,300MW power generation projects​

ISLAMABAD: The government is planning to issue Letter of Support (LoS) for 1300MW power generation, which the present government initiated on Fast Track basis.

Engineer Ali Nawaz of Private Power and Infrastructure Board told Daily Times here on Thursday that the government issued LoS for 1500MW thermal and rental power generation out of which 1300MW matured for which the government would issue LoS very soon. He further said that the government had planned to generate 16,262MW by 2016 to meet country’s power requirements.

The PPIB official further informed that the government has plans to issue LoS for another 1500MW power generation in 2009. It would include power generation through rental and thermal sources. However, the government was evaluating the price of the new power generation and is considering various options for keeping the price at minimum, he claimed.

Earlier, participants at the seminar on “How to overcome energy crises: Policy recommendations” expressed dissatisfaction on the energy policies of the incumbent government. The energy experts, former bureaucrats and civil society representatives urged the government to make the process of agreements with Private Power Producers (IPPs), including tariffs, more transparent.

It was also said that all the agreements made with petroleum exploration companies should be made public forthwith in order to ensure public right to information. They demanded that the information regarding ‘Production Bonus’ in the name of the President of Pakistan, since last 25 years by the oil and gas companies should also be made public.

Emphasising on following pro-peace and pro-people approach, the seminar urged that the government should finalise arrangements and pacts with countries like Iran, Afghanistan, Tajikistan and other Central Asian States regarding energy.

 

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Minister sees $10 billion investment in different sectors​

ISLAMABAD (November 28 2008): Minister for Investment, Senator Waqar Ali Khan said on Thursday that the government is expecting $10 billion investment in different sectors for which all the ministries have been asked to prioritise their areas for investment.

Addressing a press conference at his residence, he conceded that security of investors was an issue but the government was managing it and investors themselves were aware of it. For this purpose, Investment Division has proposed a task force to be headed by the Minister of State for Interior Affairs and Secretaries of Foreign Affairs and Investment Ministry to resolve security issues of investors.

He was of the view that the investors should know that an entity was there to resolve their security-related issues. "I am sure that the new multinational companies will have their security teams but we must also have a team which should help them out on security related issues," Waqar added.

He said, Investment Counsellors deputed in foreign countries have also been asked to send recommendations to the Investment Division as to how the government could interact with the multinational companies in their respective countries. Senator Waqar further said that Investment Division has held a meeting with the local investment companies like Pak-China, Pak-Kuwait, Pak-Libya, Saudi-Pak and Pak Brunei and asked them to function according to their mandate.

These companies have been told that their mandate was to promote investment and not invest in stock exchange, he continued. "We have asked these companies to create an investment fund and bring $2 billion investment from their respective countries so that liquidity crisis can be managed," Waqar continued.

According to him all the companies would inform the government about their priority areas for investment. He was also of the view that Bilateral Investment Treaty (BIT) with the US will be signed within a couple of weeks and for this purpose a summary would be submitted to cabinet after vetting by the ministry of law.

"It is our utmost effort that BIT with the US could be signed as early as possible," he stated. Senator Waqar further said that a delegation of German investors was visiting Pakistan, which has already conveyed interest in investing in energy sector projects.

He said, President's visit to United Arab Emirates (UAE) was highly successful as he held meetings with 50 investors of different sectors. "We are expecting investment of billion of dollars from UAE investors especially from UAE investment fund," he further added.

Replying to a question, he said that the government was also making efforts to strike a deal for gas import with Qatar in addition to Pak-Iran gas pipeline. He revealed that Al-Tuwairqi Group has shown interest in import of LNG gas for which a terminal would be established in Karachi.

Answering another question, he said that Ministry of Investment has been created just to give one window facility to the investors as in the past they were not treated properly. In reply to another question, he said that the government would take a policy decision to bring back flown capital very soon. This issue had also been discussed by the federal cabinet in its previous meeting.

He said that the government was also expecting $4-5 billion investment in different sectors from China which has already promised $500 million. He further said that an investment conference was also being arranged in Dubai to attract investment.

 

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Joint working group to recommend measures to boost trade: Pak-Afghan JEC session ends​

ISLAMABAD (November 28 2008): Adviser to the Prime Minister on Finance and Economic Affairs Shaukat Tarin, led Pakistani delegation to the 7th session of the Pak-Afghan Joint Economic Commission (JEC) held at Kabul from November 25 to 26.

Pakistani delegation held meetings with President Karzai, Afghan Minister for Finance and Minister for Foreign Affairs. The Adviser on Finance conveyed the goodwill of the President and the Prime Minister of Pakistan for the people and the leadership of Afghanistan.

The Adviser during his meeting highlighted importance of both countries for world peace and their joint stance in the war against terrorism. These two countries are the future corridor of energy and trade between East and West.

The 7th meeting of JEC proved to be very useful as it was held at a time when both the countries require pursuing joint strategy to fight terrorism increase trade and economic development.

It was decided to negotiate a new trade Agreement enabling provisions for the removal of all irritants faced by the business community of the two countries.

The bilateral trade between Afghanistan and Pakistan has great potential and therefore, it was decided to establish a joint working group on bilateral trade to review/evaluate the existing trade related issues and recommend measures to streamline trade between the two countries and sign a new trade agreement with Afghanistan.

It was decided to hold the JEC bi-annually meeting aiming at removing delays in implementation and existing gaps. For the development of infrastructure and for the capacity building in the social sector, Pakistan has allocated an amount of 300 million dollar.

The Adviser on Finance advised for the early completion of on-going projects for the building of roads, hospitals, educational institutions and capacity building initiatives for the health and other professions so that the common man could be benefited. -PR

 

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Establishment of mini industrial estates in rural areas on the card​

RECORDER REPORT
SIALKOT (November 28 2008): The proposal to set up mini industrial estates in rural areas is on the cards, which is aimed at promoting non-traditional products being produced in the areas and generate employment opportunities for skilled and semi-skilled persons in their doorsteps in the Punjab.

Official sources on Thursday told Business Recorder that the government was according special attention to promotion and development of cottage industries. For the purpose Rs 400 million would be spent for enhancing volume of exports and productivity of industries in Punjab, he added.

The development of industrial sector was top on government agenda and during current fiscal period Rs 1.30 billion were being spent on the development of industrial sector in the province. The government has already introduced business-friendly policies for ensuring maximum establishment of industries in private sector and to expand the radius of setting up industries to rural areas for bringing industrial revolution in of the Punjab.

In order to facilitate the SMEs the Punjab government would soon initiate a" Micro Finance" loaning scheme with an amount of Rs 1 billion during current fiscal period for the development of cottage industries and creating self-employment opportunities in the Province. The concept of introducing of this scheme was to extend loan facilities to the interested persons for setting up small scale and cottage industries in the Punjab.

 

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Government to support Textile sector:Tarin ​

ISLAMABAD, Nov 29 (APP): Adviser to Prime Minister on Finance Shaukat Tarin on Saturday promised Pakistan Readymade Garments Manufacturers and Exporters Association that government would provide all out support to textile and garments sectors that employs 2 million workers in the garments sector only.

He stated this during a meeting with a delegation of Pakistan Readymade Garments Manufacturers and Exporters Association which called on him here this morning.

The Adviser noted that apparel sector performance during the period (June- September, 2008) comes to $ 1157.29 million which needs to be enhanced to increase export-based foreign exchange earnings.

Mr.Tarin also appreciated value additions made by domestic textile and garments manufacturers that help support our consumption and exports in local and international market.

The delegation of Pakistan Readymade Garments Manufacturers and Exporters Association which was led by Bilal Mulla, Chairman Pakistan Apparel Forum also informed the Adviser about industry’s financial crisis relating to increased cost of production and other problems confronting business operations of the Association members.

The delegation further briefed the Adviser regarding recent competition from neighbouring and regional countries whereby Pakistan is loosing foreign markets.

The Association members explained to Shaukat Tarin their business related problems and impediments which need government’s urgent attention for resolution - more specifically R&D support from government to the garments sector.

Apparel sector constitutes 23% of all the exports of Pakistan , with 2.8% decline in exports during 2007-08 because of energy crisis and other political factors, the delegation informed the Adviser.

Shaukat Tarin appreciated value additions made by domestic textile and garments manufacturers that helps support our consumption and exports in local and international market.

The government, he said has put in place an integrated energy generation plan that, once implemented, shall resolve uninterrupted power supply issues to the garments sector.

Shaukat Tarin explained to the delegation that with institution of ROZs in various parts of the country, the Apparel Sector shall receive government’s support package to beef up production-led growth in garments and textile sectors.

He also assured them that relevant Government organizations shall sit together, complete its homework, and shortly shall come out with a clear policy framework supportive to Pakistan ‘s apparel sector.

The Adviser to Prime Minister on Finance advised Ministry of Textile Development, FBR and other government stakeholders to sit with representatives of Pakistan Readymade Garments Manufacturers and Exporters Association to jointly work out a support plan for the apparel industry.

 

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IMF loan facility a positive sign for national economy: ICCI ​

ISLAMABAD, Nov 29 (APP)‑ President Islamabad Chamber of Commerce and Industry (ICCI) Muhammad Ijaz Abbasi has said that approval of US $ 7.6 billion Stand‑by Arrangement by the Executive Board of the International Monetary Fund (IMF) is a major achievement for the economy of Pakistan.

The total amount approved under the Stand‑by Arrangement is 7.6 billion dollars, first tranche of $ 3.1 billion has been transferred to SBP account to meet Pakistan’s current account deficit and debt payments as well as to strengthen the reserve position of the country.
“However, government should ensure that every penny of this loan is spent in the best interest of the country to achieve optimum results from this stand‑by loan facility.

He said the threat of default in foreign payment obligations which was imminent due to the crisis in the external sector would now be averted.
The authorities should now devise such set of policies during the program period that should restore macroeconomic stability and put the country on a sustainable path of development, he said.
ICCI President said the IMF financial assistance normally comes with many tough conditions like eliminating subsidies, hiking interest rates, raising and expanding taxes, slashing development expenditures and tightening monetary policies, he observed.
Abbasi said, while all these measures normally prove detrimental for the smooth growth of business and industry as well as create further difficulties for the common man.
Therefore, government should make all possible efforts to utilize IMF 23‑month credit facility of $ 7.6 billion judiciously and prudently to support the country’s economic stabilization program so that nation could be saved from further financial burden.
He said our external debt has gone up to US$ 46.3 billion and had this huge amount been utilized in the interest of the country, our economic scenario should have been far better.

He said the government must ensure judicious use of funds to be received from IMF, as wastage of financial resources on non‑developmental expenditures would be very harmful for the country.
He said that government should ensure every single penny of IMF loan is used on the productive ventures aimed at accelerating economic activities in the country so that our economy could come out of present crisis and could march on the road to development and prosperity.

 

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Pakistani delegation to seek market access from EU ​

ISLAMABAD, Nov 28 (APP): Commerce Minister Makhdoom Amin Fahim along with Dr. Mirza Ikhtiar Baig Advisor to Prime Minster on Textile Industry will lead a delegation to EU for seeking market access for textile goods.

The delegation during the visit will lobby in the European Union to get market access for textile products before the meeting of our Foreign Minister with the European Union Trade Commissioner lady Ashton in Brussels, Belgium on December 8, says a statement issued here on Friday.

Sixteen leading exporters in different textile categories are also accompanying the delegation, who will visit Paris, London, Berlin, Rome, Spain and Brussels.

European Union is already in negotiation with India for signing a Free Trade Agreement (FTA) as Bangladesh is enjoying GSP+ duty free status with EU.

At the recent Friends of Pakistan meeting, strong indications were given by EU members to help Pakistan by enhancing Pakistan’s exports to EU.

In this connection, Dr. Baig has already met Daniel Jouanneau Ambassador of France to Pakistan, Vincenzo Prati Ambassador of Italy to Pakistan and Robert W. Gibson British Deputy High Commissioner who assured him their full support in this regard.
Secretary Commerce has been advised to coordinate with Pakistan missions for tentative schedule of meetings particularly with EU Trade Commissioner lady Ashton in Brussels for presenting the visiting delegation’s point of view.

 

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Cement export via Gwadar: manufacturers turn down government proposal​

RIZWAN BHATTI
KARACHI (November 29 2008): The cement manufacturers have turned down the government's proposal to export cement through Gwadar, industry sources said. They termed it a costly and unsustainable activity due to high cost of transportation. A meeting of cement manufacturers and government officials was held in Islamabad in the second week of November, in which representatives of cement industry completely rejected the government proposal, they added.

On last Thursday also a meeting of cement manufacturers was held in Lahore for election of new office bearers, wherein they again unanimously refused the proposal and demanded more facilities at Port Qasim and Karachi. Major General Rehmat Khan, newly elected Chairman of All Pakistan Cement Manufacturers Association (APCMA) also confirmed that cement manufacturers had rejected the proposal due to unsupportable infrastructure at Gwadar port and rise in cost.

He said that the export through Gwadar port would increase cost of cement export making it unviable, as at present there is no facility of cement export available at Gwadar. "We are already exporting cement at lowest margin due to high competition in the world market and shrinking construction industry in the Middle East and United Arab Emirates (UAE)," he said.

He said that cement export through Gwadar would put additional burden of some 6-8 dollars per ton cement, which is unsuitable for the industry. However, he added that if the government agreed to pay some subsidy on cement export and provided facilities at Gwadar, "then we will consider the proposal". The APCMA Chairman said that industry would support the government to make Gwadar port operational, but at preset when the country is facing adverse balance of payments situation and needs foreign exchange, this decision would hurt cement export.

He said that that the immediate requirement of wheat has been met in the country. Therefore its import of remainder quantity could be shifted through Gawadar. However, cement export through Gwadar port without subsidy and infrastructure is not viable for the cement manufacturers, APCMA chairman said.

He urged the Government to facilitate cement export by providing dedicated berths at Port Qasim and Karachi port, which would be supportive for the cement industry and benefit the country.

He also expressed concern over high interest rates being charged by banks and over high and unreasonable level of marking fee being levied by Pakistan Standards and Quality Control Authority (PSQCA) and said that it would seriously retard the growth of the industry.

 

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29.41 percent rise in SPI inflation​

ZAHEER ABBASI
ISLAMABAD (November 29 2008): The SPI inflation surged by 29.41 percent on week ending November 27 over the same period of last year because of sharp increase in the prices of some vegetables, meat and other commodities. Weekly figures on SPI inflation, released by the Federal Bureau of Statistic (FBS) on Friday, showed that after Rs 16 increase, the price of tomatoes per kilogram has gone up from Rs 35.71 to Rs 52.63 during the week.

Similarly, the price of dozen eggs has increased from Rs 65.83 to Rs 73.98 during the week. This is the second consecutive week that inflation has started resurging after a brief period of decline at the beginning of the month on the back of falling prices of commodities in the international market.

This trend in inflation shows that the tight monetary policy of State Bank of Pakistan (SBP) was not working to tame it. The SPI inflation re-surged from 27.91 percent to 29.41 percent during last two weeks, indicating that despite decline in some commodities prices in the global market, the prices of essential commodities have been on the rise. Though palm oil cost has declined substantially, the price of ghee and cooking oil has not been reduced.

The combined SPI after a surge of 0.32 percent during the week has gone from 29.02 percent last week to 29.41 percent this week. With this increase in the SPI, the dearness for the low income group bracketed in Rs 3000 was recorded 29.39 percent, followed by 29.85 percent for Rs 3001-5000 monthly income families. The dearness was counted 30.31 percent for the families earning monthly Rs 5001-12000 and 28.92 percent for above Rs 12000 income group.

The data on SPI released by FBS showed increase in the prices of 13 essential commodities, decline in 15 while the prices of 28 items remained stable but dearer with most of them in double digit as compared to last year.

The price of per kilogram tomatoes was increased during the week to Rs 52.63 from Rs 35.7, egg hen (farm) doz to Rs 73.98 from Rs 65.83, onions kg to Rs 26.87 from Rs 25.02, mash pulse washed kg to Rs 75.45 from Rs 74.82, potatoes kg to Rs 27.70 from Rs 27.53, electric bulb 60 watts each to Rs 13.97 from Rs 13.91,

firewood 40 kg to Rs 266.18 from Rs 265.06, bread plain medium size each to Rs 24.06 from Rs 23.97, mutton kg to Rs 257.13 from Rs 256.51, beef kg to Rs 142.24 from Rs 142.20.

The price of chicken (farm) kg declined during the week to Rs 92.12 from Rs 98.22, garlic kg to Rs 43.16 from Rs 44.15, bananas doz to Rs 31.25 from Rs 31.86, LPG (11 kg cylinder) each to Rs 819.97 from Rs 835.41, vegetable ghee loose kg to Rs 98.10 from Rs 99.93, red chillies kg to Rs 140.61 from Rs 143.03, sugar kg to Rs 35.10 from Rs 35.58, wheat flour average quality kg to Rs 26.72 from Rs 27.04, mustard oil kg to Rs 143.43 from Rs 144.76, wheat average quality kg to Rs 24.88 from Rs 25.06, gur to Rs 39.10 from Rs 39.34, rice basmati broken kg to Rs 48.46 from Rs 48.64, masoor pulse washed kg to Rs 128.81 from Rs 129.28, kerosene litre to Rs 68.28 from Rs 68.40, rice Irri-6 kg to Rs 38.54 from Rs 38.58.

 

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NAB approves corruption references, investigations​

ISLAMABAD (November 29 2008): A meeting of Executive Board of National Accountability Bureau (NAB) held here on Friday presided by Nawid Ahsan, Chairman NAB approved a number of references. According to a NAB press release, reference against Muhammad Aslam Chairman Kissan Co-operative Commercial Corporation Limited (KCCCL), Sargodha and seven others.

The investigation revealed that Chairman KCCCL in connivance with other accused dishonestly and frequently cheated public at large and misappropriated Rs 115.123 million. Moreover 4,144 depositors submitted their claims worth Rs 115.56 million. (b) Reference against ex-assistant collector Muhammad Abdul Latif who has acquired assets and properties disproportionate to his known sources of income to the tune of Rs 12.858 million which he was not able to justify.

(c) Reference was approved against Muhammad Saddique Khattak and others. According to investigation carried out by NAB, the accused in connivance with each other embezzled 57, 998 cubic ft timber of Hazara Tribal Forest Division and also embezzled government duties and owner royalties. The total loss to the government and owners is Rs 20.406 million.

(d) Reference against Abdul Rahim, Deputy Manager Regional Complaint Centre Multan Electric Power Company. The accused had acquired assets beyond his known sources of income.

 

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Fortifying ties: Pakistan, US agree to sign BIT by year-end​

By Sajid Chaudhry

ISLAMABAD: Pakistan and United States have agreed to sign Bilateral Investment Treaty (BIT) before the end of the current calendar year 2008 and hectic efforts have already started to settle all remaining issues to achieve the time line.

Federal Minister for Investment Senator Waqar Ahmed Khan informed Daily Times during an exclusive interview here on Friday that issues relating to arbitration, transparency clause still need to be resoled. In this regard, Pakistan has sought final comments from the US so that things could be finalised by mutual consent. In a recent meeting with US Ambassador and US Commercial Attaché the Ministry of Investment has sought final opinion of US authorities in BIT draft.

The present government wants BIT to be equally beneficial for both the signatory countries as this would be crucial for further negotiation to conclude bilateral Free Trade Agreement (FTA) with US, the minister added. The Pakistan Peoples Party led coalition government has decided to obtain legal as well as expert’s opinion on the draft of the BIT. In this regard, draft has been handed over to the Ministry of Law and Justice and private legal consultants so that its clauses could be analysed keeping in view the international best practices, said the minister.

Pakistan is of the view that signatory countries to BIT do not use any political influence or any media campaign if any matter is referred for arbitration as well as transparency is upheld by both sides for mutual benefit, the minister explained.

Once the comments are received from the US side this matter would be again discussed in detail and it would be placed before the federal cabinet for formal approval, said Khan. Replying to a question on allowing Indian investors to invest in Pakistan, the minister was of the view that investment from all counties should be allowed as this would help economic integration of the regional countries for the benefit of the people.

We are going to propose to the government that there should be legislation on continuation of policies so that protection of investment is ensured and long-term objectives of the investment vision is achieved.

The present government has fixed three priorities including restoration confidence of local as well as foreign investors, good governance with time management and improvement in law and order situation especially fool proof protection to the investors.

To achieve the prime objective of protection to the foreign investors the government would shortly set up a task force on investors’ protection that would be having participation from all the federating units. A special force would be providing security to the investors with the help of all law enforcement agencies in all parts of the country, he maintained.

The minister was confidant that Pakistan, being an emerging economy, would be able to attract sizeable investment in the coming years with quick service delivery to the foreign as well as local investors. In this regard, the one window facility, with micro-management, in the Ministry of Investment with focal persons in each federal ministry or department and each in all four provinces would facilitate investors, he said.

The investment ministry would finalise in three to four weeks time investment vision for the next five years and that would be taking into account all steps that are needed to attract investment from all parts of the world.

Foreign investment in Pakistan would be doubled in next fiscal year by facilitating investors having interest in making investment in Pakistan. Attracting huge investment in oil and gas, power generation and infrastructure development are the priorities of the proposed investment plan of the PPP led coalition government. Investment conferences are being planned to attract foreign direct investment from China, Middle East and European countries.

Foreign investors have agreed to set up open-ended equity fund for infrastructure development and similar equity fund would also be set up for the local investors and all investors would be allowed to participate.

 

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TDAP establishes new divisions to boost exports​

By Tanveer Ahmed

KARACHI: Trade Development Authority of Pakistan (TDAP) has made major structural changes in its setup by establishing new divisions to improve the working and efficiency of the organisation and export promotion, the basic objective it was created for.

A total of ten divisions – headed by Director Generals - have been established to streamline the functions of the authority. The objective cited for regrouping of the functions was the overlapping in critical areas, which was hampering the efforts to increase exports. The new setup will be effective from December 01, 2008. Under the new setup, the new divisions created include Agro Food Division, Textile & Clothing, Mines & Minerals Division, Engineering & Other Manufacturing Division Services Division, Europe Division, America & African Division, Human Resources, Finance & Administration, Asia Division, Facilitation Division. A separate investment and women entrepreneur wing has also been established in the authority. TDAP, established in 2006, replaced the defunct Export Promotion Bureau (EPB), is still in the process of transformation.

“Now the direction has been set and the real work of authority to develop the trade and boost export starts now,” an official pointed out. Since the change of guard at the authority some few months back, changes have been made in the organisational setup of TDAP. These divisions will be responsible for developing plans and projects and would carryout the activities to help developing the export potential of Pakistani products and services. Furthermore, the export potential of products will also be improved, according to official papers of the authority.