Pakistan Economy - News & Updates - Archive

[bhangra12345]

Much of this growth was not real growth but the effects of inflation/currency fluctuation.

The economist PM of Pakistan failed to mention this while claiming to double the economy in 5-6 years flat.

Actually, it is a result of "number management" + inflation.

Sometime around 2002, Pakistan changed its way of measuring GDP, so these two numbers are not comparable.

I questioned the sagacity behind the repeated comments by the senior leaders claiming that the economy had doubled in size in the six year period since 2001 implying that it had grown by 12 per cent a year. It was again repeated at the Lahore seminar by the senior officials that the GDP had increased from $70 billion to $140 billion in half a dozen years.This rate of increase would be plausible only if it was in nominal terms and factored in also the large (20 per cent or so) increase produced by the rebasing of the national income accounts to 2000-01.

In other words, a 12 per cent rate of increase was partly the result of inflation and partly the consequence of the accounting change in the estimation of national income accounts. No serious economic analyst uses nominal increases in GDP or GNP as a measure of the growth of the economy. If the rate of inflation jumped, say, to 100 per cent a year would the economic managers celebrate the fact that the size of the economy had more than doubled in one year?

DAWN - Opinion; May 08, 2007

 

[Neo]

Interim regulatory changes cause temporary recovery on KSE ​

Sunday, June 29, 2008

KARACHI: Karachi stocks market made the best and also the worst records during the week ending June 27.

The benchmark KSE-100 share Index recorded highest intra-day increase of 960 points (or 8.6 per cent) in a single session on Tuesday, and generated six-year low turnover of 29.7 million shares on Friday.

These two extremes were due to overnight changes in regulations that the SECP made in capital markets for an interim period of 30 days, affective from Tuesday, June 24.

On week-on week basis the KSE 100-share Index gained 698 points or six per cent and closed at 12,353 points.

The parallel running junior 30-Index also posted a recovery of 1,095 points or 8.2 per cent on weekly basis and concluded at 14,459 points.

On an average, market generated a turnover of 149.5 million shares this week with Rs203 billion funds to overall market capitalisation rose to Rs3.795 trillion.

The Securities and Exchange Commission of Pakistan (SECP) temporarily amended on Monday that no one share can dip beyond one per cent in a day against five per cent was earlier and similarly any share can go as high as to 10 per cent maximum in a day against five per cent. It also banned short-selling completely in market.

The Commission also relaxed investors by giving them a 15 days exemption of submitting zero per cent receivables to the Exchange against the credit that they borrow for buying shares. The apex regulator also announced accepting guarantees of banks having ‘A’ (Single A) rating as collateral against the margins that borrowers are supposed to submit for the leverages for more than 15 days.

Prior to these amendments the KSE had lost more than 4,500 points (or almost 29 per cent) from the all time high of 15,676 points closing on April 18, 2008, to 11,162 points by the Monday, June 23. Only on Monday, chief 100-Index lost 493 points or 4.23 per cent.

The amendments invited huge, but artificial buying that helped market scoring 960 points or 8.6 per cent only on Tuesday. The KSE-100 Index also rose by another 308 points or 2.54 per cent on Wednesday, and finally up by 22 points or 0.18 per cent on Thursday.

The regulators controlled market turned to its ugly face on weekend when more than dozen stocks hit lower circuit of one per cent on across the board amid generating six year low turnover at 29.7 million shares. The condition of limiting single day fall maximum to one per cent only, however, restricted Friday losses on 100-Index to 0.79 per cent or 99 points.

Analysts observed that the Tuesday buying was an ignorant response of a section of investors, who realized later that they had committed a blunder. They (investors) tried to withdraw the funds they had injected during rest of week sessions, and that is why market fell negative on weekend, they added.

A section of analysts was of the opinion that the temporary changes in regulation would frustrate short-term investors, as new regulations allow investors entering into the market, but there is no exit.

As far as the long term scenario is viewed then it does not depict positive picture. If, which is looked more likely, the central banks raises key policy rates by another 50 to 100 basis points in its Monetary Policy (MP) to be announced shortly then the question of liquidity crunch would become more complex.

“The raise of 150bps (1.5 per cent) discount rate by SBP in its interim MP statement announced on May 23, has already draught excessive money from the market. Another increase of discount rates would affect market very badly,” said analysts.

Low interest rates and free flow of money run capital markets in upward direction, but corrective measure that the high officials were taking to fix the local economy might keep the stocks market depressed.

Fundamentals have turned weaker and sentiments too, but an influx of positive news e.g. announcement of June corporate results in line with market expectations could save the market from the worst.

Therefore, speculative buying in fundamentally weak financial stocks and volatile energy stocks placed market in positive territory this week. But the short to medium term scenario is yet uncertain.

Stocks fundamentals are yet to be changed to positive and issues on economic and political fronts are needed immediate attention of government officials.

The resolution of oil and food inflations on economic front; war like situation in federally administrated tribal areas on law & order front; and lawyers’ movement amid President Musharraf impeachment issue resolution on political front could only improve stocks fundamentals on long term basis.

Weekly Movement in Blue Chips
Symbols Open on Close on Difference

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

Adamjee Insu. 271.25 237.45 -33.8
Attock Refin. 262 252.4 -9.6
GGKC 59.58 67.81 8.23
EFU Gen.Insu. 427 364.5 -62.5
ENGRO 261.78 280.81 19.03
FFBL 34.01 35.97 1.96
HBL 190 210.37 20.37
LUCK 93 98.91 5.91
MCB 269 329.67 60.67
NBP 141.48 148.98 7.5
OGDCL 122.5 125.61 3.11
Pak Reinsu. 104.2 87.68 -16.52
POL 361.5 368.52 7.02
PPL 251.5 248.47 -3.03
PSO 402.1 421.45 19.35
PTCL 38 39.03 1.03

 

[Neo]

US govt asked to meet Kabul’s wheat needs: Smuggling continues​

KARACHI, June 28: The US government has endorsed Pakistan government’s assessment of wheat smuggling to Afghanistan and has estimated it at around 1.8 million tons during the last season. It continues this season also.

“We have asked US administration to meet Afghanistan’s wheat demand this season,’’ a senior officer of the federal food ministry in Islamabad informed Dawn by telephone on Saturday.

“For years together, we were providing a few hundred thousand tons of wheat to Afghanistan every year,’’ the officer said. Last season, however, the wheat flow to Afghanistan jumped to unusual high level. The only explanation is that a large number of Afghan refugees, who went back from Peshawar and Quetta to their homes, got addicted to Pakistan’s hard white wheat and hence the unending demand for it in Kabul and Kandhar.

As wheat smuggling to Afghanistan shows no respite so far, the Punjab government’s prescription is to stop wheat supply, since the beginning of harvesting, to two border provinces, the NWFP and Balochistan. This has caused a protest and unending outcry in the two provinces against Punjab.

“Imagine if we stop gas supply to Punjab,’’ a senior bureaucrat in Quetta quipped when his attention was drawn towards reports of scarcity of wheat flour in many parts of Balochistan. Flour mills industry leaders in Quetta are also bitter on Punjab government’s decision to stop wheat supply and provide wheat flour only on permit.

A consensus view of the NWFP and Balochistan millers is that Punjab wants to protect and promote its flour milling industry at the cost of two provinces, which is causing unemployment and hardships to the

consumers.

“It is the responsibility of security forces under federal government to guard and seal international borders,” a businessman remarked and he explained that provincial governments were not responsible to check and monitor movements on international borders.

“Why flour mills and consumers in NWFP and Balochistan are suffering if the security forces are not able to seal the borders,” Naeem Butt, the president of All Pakistan Flour Mills Association in Peshawar said.

The flour mill industry leaders of NWFP and Balochistan call this inter- provincial restriction on wheat movement from Punjab as “illegal and unconstitutional.” “Punjab government is providing 8,500 tons of wheat and wheat flour to Peshawar every month,’’ a food ministry official informed.

The official conceded that the Punjab government’s decision to restrict inter- district and inter-provincial wheat movement has caused lot of heart burning and bitterness in NWFP and Balochistan and that it was illegal and unconstitutional.

“In virtually every meeting of Economic Coordination Committee (ECC) of the cabinet or of the Minfal we tried to convince the Punjab government of serious political and economic implications of its decision to restrict wheat movement,’’ he said adding there have been some relaxations in these restrictions.

Naeem Butt, however, contests this assertion of the food ministry official and said wheat flour is being supplied against permits that it is very difficult to get into Punjab. Flour importers in NWFP have to go all the way to Lahore to get permits and finally to district authorities in some border districts. “There are hassles and some money involved to get a permit for a few tons of wheat flour,’’ he alleged.

The NWFP milling industry leaders have already filed a constitutional petition in the Supreme Court against the Punjab government’s decision to restrict wheat movement. Naeem Butt said that the petition will come up for hearing on July 4 next. The millers had filed a similar petition against the Punjab government’s restrictions in 2003, which was decided in favour of industry leaders.

Prices of wheat, wheat flour and bread are high in NWFP and Balochistan mainly because of the Punjab government’s restrictions. Prices of wheat and wheat flour in Karachi, too, are showing no signs of respite. Karachi now gets wheat from only three districts of the province on permits.

“More than 60 per cent of 78 mills in Karachi are closed because of wheat scarcity,’’ a leader of flour mills industry said.

Wheat prices touched Rs2,300 and 2,350 for a 100 kg bag in Karachi as very little quantity is trickling in from three districts, from other districts and from Punjab at a very high price. Wheat flour is now being sold at Rs27 to Rs32 a kg in Karachi.

“Our job is to make wheat available in the market which we have done,’’ Mir Nadir Magsi, the Sindh food minister said on telephone. Prices of wheat and wheat flour, he said, are the responsibility of city government.

With the holy month of Ramazan hardly 12 weeks away, prices of all essential items -- wheat flour, sugar, pulses, milk, curded, vegetables, edible oil has started showing a rising trend. Market analysts say that prices fixation and monitoring may be the responsibility of the city government but an effective mechanism to ensure steady supply and stable prices can only be ensured if a joint strategy is worked at all the three tiers—federal, provincial and district.

The government is giving final touches to a grand Ramazan package,’’ the food ministry official said from Islamabad.

US govt asked to meet Kabul’s wheat needs: Smuggling continues -DAWN - Business; June 29, 2008

 

[Neo]

Textile sector likely to get Rs 30bn despite gloomy exports​

* Govt mimicking approach of previous regime
* Move described as ‘political rather than economic’​

ISLAMABAD: Despite dismal exports performance in the outgoing Fiscal Year 2007-08, the textile sector is likely to grab a Rs 30 billion Research and Development (R&D) support for the next Fiscal Year 2008-09, a high placed government official informed Daily Times Saturday.

The Economic Co-ordination Committee (ECC) of the Cabinet which is scheduled to meet on July 1, 2008 at Karachi, in the chairmanship of the Prime Minister Syed Yousuf Raza Gilani, is likely to allocate the amount for R&D support for the textile sector, the official added.

The textile sector, which has already enjoyed a huge sum of Rs 19 billion subsidies as R&D support during the outgoing Fiscal Year 2007-08, has failed to produce results and over all sector sector’s exports have witnessed a decline of 2.5 percent. The textile exports during July-May period of outgoing Fiscal Year 2007-08 have managed to reach at $9.591 billion as against the $9.837 billion in the same period of previous Fiscal Year 2006-07.

After availing subsidy equal to $320 million in the last two years, the textile sector has failed to increase the textile export to the same level. Textile exports have witnessed a decline of $246 million in July-May period of outgoing Fiscal Year 2007-08 as compared to the same period in the previous fiscal year. The authorities concerned feel that R&D support should not be allowed, as this is making local textile industry more un-competitive and it is relying on subsidies rather than competition.

This textile subsidy is to be provided out of the budget estimates for the 2008-09 and it would be an additional burden on national exchequer. The present government, which has been criticising the previous government for allowing out of the budget R&D support to the textile sector, is going to repeat the same practice in the next fiscal year.

The previous government had not allocated a single rupee under the head of R&D in the budget for the Fiscal Year 2007-08; however, it approved and provided out of the budget R&D support to the tune of Rs 19 billion. However, the next ECC meeting is likely to approve a huge sum of Rs 30 billion as R&D for the textile sector without taking in to account the performance of the sector.

The authorities are of the view that R&D support was actually meant for product development and research for improvement in designs and export competition. According to the reports the R&D support is being misused to a large extent and authorities concerned have already decided to conduct audit of the textile units availing such subsidy.

At this point of time when the country is under pressure due to projected heavy budget deficit of Rs 737 billion in the outgoing Fiscal Year 2007-08, allocation of a huge amount as textile subsidy is being viewed as political decision rather than an economic one.

Budget deficit of the country has been estimated at Rs 661 billion and after ensuring saving of Rs 79 billion cash balance surplus of provinces, the consolidated budget deficit of the country is set to come down to Rs 582.3 billion in the upcoming Fiscal Year 2008-09.

Government has plans to borrow Rs 557.6 billion from internal and external resources to finance the budget deficit in the upcoming Fiscal Year 2008-09. According to the government’s strategy to finance the budget through opting different borrowing options in the next Fiscal Year , the government would borrow Rs 165.2 billion from external sources, non-bank borrowing of the federal government will be Rs 242.9 billion and Rs 149.5 billion are to be borrowed from banking sector. Apart from the internal and external borrowing options, privatisation proceeds to the tune of Rs 25 billion would also help bridge the income expenditure gap and meet the overall consolidated budget deficit of Rs 582.3 billion.

Daily Times - Leading News Resource of Pakistan

 

[Neo]

Rice, kinnow and potato export to Iran expected to increase​

KARACHI: Pakistan exports of rice, kinnow and potatoes are likely to increase as Iran has abolished import duty on these items, traders told Daily Times Saturday.

There was an import duty of up to 150 percent on rice, potato and kinnow in Iran, which has now been removed.

The president of Zahidan Chamber of Commerce and Industry and Mines (ZCCI&M), Abdul Hakim Reigi, told the business community recently that Iran has made the import of rice, kinnow and potato zero-rated. The local exporters now have decided to increase their export to Iran and were willing to export local rice and other items to Iran and other countries via Iran.

Ijaz Ahmed Choudhary, a rice exporter, told Daily Times that the decision of cutting the import duty by Iran would definitely boost Pakistani rice export. Pakistani exporters would be able to export rice in large volumes because of good quality of local rice.

He said last year Pakistan could not export large quantity of rice to Iran because the last rice crop was not as good as it was expected to be. Besides, the huge import duty on rice by Iran was a big hurdle for Pakistani exporters although Iran remained a big market for the export of Pakistani items.

Abdul Wahid, chairman Fruit and Vegetable Association, said although no notification has been issued by the government of Iran, “but we think that this cut of import duty will definitely increase Pakistan’s export of fruit to Iran.”

He said local market supplies would not be hurt by increased export of fruit to Iran because Pakistan has a surplus of fruit and vegetables. Traders were of the view that the government of Pakistan should allow some concession on export of rice, potato and kinnow from Pakistan to Iran so that the exporters could generate more foreign exchange for the country.

Daily Times - Leading News Resource of Pakistan

 

[Neo]

KPT unveils rail, port connectivity plans​

KARACHI: Karachi Port Trust (KPT) unveiled plans regarding rail connectivity with the port and cargo yards Saturday.

Chairperson KPT, Nasreen Haque said as a first step the railway track dismantled connecting TPX and Groyne Yard would be restored.

Meeting with the General Manager Operations Pakistan Railways, Asad Saeed she said railway line would also be extended to the coal stacking area near Groyne Yard for direct loading from there.

This would ensure prompt movement of import and export cargo from and to the port presently hampered, as it has to pass through the heavily congested metropolis facing acute traffic problems, she added.

Chairperson emphasized the importance of advance planning by railways in line with the KPT plans for development of their infrastructure and rolling stock enabling proper logistics to cater for the present and future traffic.

Daily Times - Leading News Resource of Pakistan

 

[Neo]

Emaar Pakistan ushering in new lifestyle concept​

islamabad: Emaar Pakistan, the country subsidiary of Emaar Properties is recreating the same successful ‘Dubai model’ in Pakistan with its master planned communities, highlands and Canyon Views in Islamabad and Crescent Bay in Karachi.

According to a press release Saturday these projects are part of a $2.4 billion investment in the country by Emaar.

Managing director Emaar Pakistan, Steve McCartt said the world over preferences of community living was changing.

Today, driven by high purchasing power and the need for luxury living, youngsters seek convenient lifestyle options. This can be provided only through integrated lifestyle environments, which is a core competency of Emaar, he added.

Emaar’s expansion to Pakistan is in line with its Vision 2010 to become one of the most valuable companies in the world through geographic expansion and business segmentation.

It is in this context that the master-planned communities introduced by Emaar Pakistan assume significance.

Emaar’s ‘designer’ communities offer all these advantages to residents. This approach of Emaar to create a new lifestyle has been one of the catalysts of the property boom in Dubai, the company’s home market.

Emaar’s focus on quality and in creating a new lifestyle choice has earned the trust and interest of customers.

The new standards of living rolled out by Emaar are now a benchmark in residential developments in Pakistan.

Emaar Pakistan’s path-breaking initiative of ushering in a distinctive lifestyle to the country is now a benchmark for modern community living.

From a modern family’s perspective, an urban lifestyle environment must feature educational institutions for the children, healthcare facilities for all, leisure and retail choices, entertainment options, fitness facilities and a sense of community living with a vibrant community centre.

Daily Times - Leading News Resource of Pakistan

 

[Neo]

Iran-Pakistan-Cooperation ​

Caretaker of Economic and Finance Ministry Hossein Samsami on Sunday held talks with Pakistani Minister of Finance, Revenue, Economic Affairs and Statistics Syed Naveed Qamar on broadening Tehran-Islamabad economic cooperation.

In a meeting with his Pakistani counterpart who is currently on a visit to Tehran to attend the 17th session of Iran-Pakistan Joint Economic Commission, Samsami expressed hope that mutual trade and economic cooperation would further expand.

He said that Iranian economy is experiencing a boom thanks to the privatization drive adding that Iran is willing to share experience with Pakistan to usher in the same process in Pakistan too.

"Iran is interested in bilateral cooperation with Pakistan in water, power and railway fields."
Referring to Tehran-Islamabad considerable potentials and common interests, Pakistani finance minister, for his part, said that his country is quite ready for boosting cooperation with Iran.

Syed Qamar expressed hope that the country would widen banking relations with Iran.

Iran, Pakistan keen on boosting economic cooperation - Irna

 

[Neo]

Long-term financing for power plant import ​

EDITORIAL (June 29 2008): Coming at the heels of National Electric Power Regulatory Authority's proposal to the Karachi Chamber of Commerce and Industry (KCCI) to set-up its power generating units so as to meet the power shortage in the city, understandable should become the decision of the State Bank of Pakistan to allow import of power plants and machinery under 'Long Term Financing Facility (LTFF)', pointing out that the initiative was prompted by requests from the exporters and industrialists to meet their power requirements amid a continuing power shortage across the country.

It was only a day earlier when speaking at the third meeting of the KCCI's Public Sector Utilities, Power and Gas Sub-Committee, Member (Privatisation) of Nepra Maqbool Ahmed Khwaja had observed that the country was facing a serious power shortage, leading to long hours of load shedding which hampered industrial production in no small a way. Quoting a precedent, in this context, he made ready reference to Wapda's load shedding in Islamabad for around six to eight hours.

To address this predicament, as he pointed out, the government allowed the long ailing utility giant to establish 50MW power units without the Nepra's permission. It will, however, be noted that Khwaja also sought the KCCI's help to reduce power theft. But justifying the rise in power tariff, he said that tremendous increase in the world oil prices had compelled the Nepra to revise power tariff upward.

In so far as the rather belated gesture of SBP is concerned, with reference to LTFF Scheme of 2007, it advised that from July 1, 2008 financing for import of generators and captive power plants, meant for use in the eligible sectors and sub-sectors as per list given in Schedule 1 of LTFF Scheme, will also be admissible under the Scheme.

Needless to point out, this long due initiative can go a long way to help industrialists and exporters have their own power plants and machinery under soft loan scheme, at a time when the country stands threatened by the worst ever shortage of power.

However, this is not to say that all segments of power consumers, including traders, industrialists and households, had remained silent spectators of the poorly managed outages, and did nothing, on their own to brave its calamitous consequences.

So to believe will be simply naïve to say the least. For every category of power consumers across the country who could afford it did contribute to the needed effort, if not uselessly to help the Wapda and the KESC overcome their troubles, but from their own sense of enlightened self-interest.

This should leave little to doubt from the increasingly massive sale of generators of various descriptions, besides resort to UPS on an ever widening scale year after year. The same can be said about the people's urge for conservation of energy too, much earlier than the rulers' bid to acquaint them with the advantages of saver bulbs.

Add to this the offer of wind and solar power generation systems in Pakistan by Emerging Energy Systems (EES), a firm that claims to be operating in the Middle East and North America, and Korea's Hyundai Corporation's earlier move to introduce its Packaged Power Station (PPS) as a prompt solution to the prevailing power crisis, and one would have a fair idea of the immense support the country can mobilize to end its power woes from different enabling thrusts.

Business Recorder [Pakistan's First Financial Daily]

 

[opinion786]

=bhangra12345;169987]The statistics of 2006 for Pakistan has been told by the govt as fudged.
I wouldnt put my bet on this number also. Aziz govt overspent Rs558bn, fudged figures: Dar

You believe Darr? Himself a manipulator?

Dar's criticism termed 'financial engineering'
Business Recorder [Pakistan's First Financial Daily]

For growing from 75 to 160 in 7 years, i.e. a growth of 113% in 7 years, which is more than 15% growth per year. Go figure

Yes, actual growth is around this much. Real GDP is around 7%. Rest is inflation adjusted. Just becuz we adjust inflation later doesn't mean the economy hasn't boomed. Go figure.

from the source dated jan 2006, he was in power from that time to dec 2008, i.e. 2 years, how many univs came up or was this an "election promise" as we say.

Get complete information before you judge. He started HEC in 2001-02.

a) Air University (established 2002)

b) Institute of Space technology, ISB (established 2002)

c) Sardar Bahadur Khan Women University, Quetta (established 2004)

d) University of Science & Technology, Bannu (established 2005)

e) University of Hazara (founded 2002)

f) Malakand university, Chakdara (established 2002)

g) Karakurum International university, Gilgit (established 2002)

h) University of Gujrat (established 2004)

i) Virtual University of Pak, Lahore (established 2002)

j) Sarhad University of IT, Peshawar (established 2001)

k) National Law University, ISB (2007)

l) Media University, ISB (2007)

m) University of Education, Lahore (2002)

n) Lasbella University of Marine Sciences, Baluchistan (2005)

o) Baluchistan University of IT & Management, Quetta (2002), etc.

The private sector institutions include private schools and madrassas. So what is the break up?

Both are meant for education purposes. If you had known, that Madressahs are NOW registered institutions and governed by Education board and they follow a specific syllabus with includes Science subjects.

Leave aside private schools and you'll see MAJORITY % are PUBLIC schools!

Punjab - schools 66,770 (58 percent) were public schools
Sindh - schools 46,738 (about 79 percent) were public schools
NWFP - schools 29,430 (72 percent) were public schools
Balochistan - schools 9,742 (about 85 percent) were public schools

from a post just two posts above
"Quoting the figures released by SBP (State Bank of Pakistan) last year, a quantum annual increase of 61.18 per cent has been registered with IT exports of US $116 million against the previous year’s US$72 million." whom should I believe? Note in the source it was given as IT sector. Or some "difference" in meaning of IT?

Yes, if you would have just tried to know in detail...

State Bank of Pakistan adopted BPM 5 Reporting system to report the IT exports revenue, which restricted the export figures to US$116 million only in 2006-07.

In India, the Reserve Bank of India follows the BPM 6 (also called MSITS) Reporting System, which raises its exports to billions of US dollars. BPM 6 includes sales to multinationals, earning of overseas offices & salaries of non-immigrant overseas workers to export revenue.

Using the MSITS Reporting System, Pakistan IT Industry exports are estimated at US$ 1.4billion while the industry size is estimated at US$ 2.8 billion. It is significant to note that Pakistan IT exports growth in each of the last few years has been more than 50%.

State Bank Reporting Earnings - $116 million

Estimated Total IT Industry Export Revenue - $ 1.4 billion

Estimated Total IT Industry Size - $ 2.8 billion

Pakistan Software Export Board - Industry Overview (Official State govt site)

etc. etc, so may I ask you, what has Musharaff done for Pakistan?
Next time please cross check your sources.

Now this I call ignorance or bias against Musharraf. Pakistan is 100% more better than since 1999.

There may be two three ways of recording and presenting in a report.
1- Annual comparison.
2- Monthly comparison corresponding to last year.
3- Comparison from 2000

So if State Bank says something, it is never wrong - we just need to check in more details to show what it means to say and compare. Next time pls confirm before you judge.

 

[opinion786]

Bhangra12345;170047]Actually, it is a result of "number management" + inflation. Sometime around 2002, Pakistan changed its way of measuring GDP, so these two numbers are not comparable.[/CODE]

See this again is lack of information. If its number management, why hasn't the new PPP government challeneged it? See the latest "Economic Survey" of Pakistan report issued by PPP and they have acknowledges all the past figures.

One e.g: Per Capita Income 2008 - $1000
Daily Times - Leading News Resource of Pakistan

Pakistan rebased in Nawaz sharif era 1998; so the figures of 1999 and 2008 are comparable.

 

[opinion786]

The Pak Economy: Bigger than We Think​

By: Dr. Nayyer Ali

25 June 2004: The Finance Ministry of Pakistan came out with the Annual Economic Survey last week, and it offered both a huge surprise, and an explanation for an economic mystery that had developed over the last seven years. The mystery was how did India’s economy, measured on a per person (commonly called per capita) basis, become so much larger than Pakistan’s?

After the first 45 years of growth, Pakistan had enjoyed a faster rate of growth resulting in a higher per capita GDP (gross domestic product) than India. Since 1991, India has grown faster than Pakistan, but it started from far behind. However, about 1998, India’s statistics surged past Pakistan, and widened their lead through the next several years. By 2003, India had a GDP per capita of 500 dollars, while Pakistan, depending on the source, was about 450. Measured using an alternative technique that takes into account the lower costs of services and labor in poor countries (i.e. a haircut in Pakistan does not cost 15 dollars) to more accurately reflect purchasing power, India was listed as being way ahead at 2800 dollars versus only 1900 for Pakistan.


This was an obvious statistical paradox as any visitor even today to Karachi and Mumbai can tell. How can Indians have a statistical standard of living that is 50% higher than Pakistanis, but on the ground there is no Pakistani equal to the miserable poverty of large segments of the Indian population? World Bank data on poverty shows that even today the proportion of the Indian population living on less than two dollars per day in purchasing power is much higher than in Pakistan. Consumption statistics on such mundane items like electricity and food show Pakistan as equal or better than India. And statistics on underweight and malnourished children favor Pakistan.

Calculating the size of the economy (the GDP) is in fact a very complex and difficult task. And then to calculate the growth from one year to the next is even more difficult. Throw into that such factors as inflation and technological changes and the picture can get very murky. Imagine a chess game that you photograph, and then someone tells you what each player does for the next 50 moves. If the information is totally accurate, 50 moves later will you be able to replicate the actual situation on the chessboard. But if the information is not accurate, if there are new pieces being introduced, and if you don’t understand some of the moves, you will quickly end up with a chessboard that does not resemble what has really happened. The best thing to do is to go back to the actual game, and take a new picture.


The economy is like that chess board but even more complicated. For example, let’s say that in a certain year 10 million tons of wheat are grown and sold at 200 dollars per ton. The next year 11 million tons of wheat are grown, but sold at 180 dollars per ton. Did the economy grow, or not? In dollar terms there was a 1% decline, but actual wheat production jumped ten percent. If a new car comes with air bags but costs the same in dollars as last year’s car that did not, is that growth? Measuring the economy is in fact quite complex.


The first step in measuring an economy is establishing a profile of the GDP. This is done by creating a base year. But as the economy changes and adds new products and services that never existed before, the base year must be updated to accommodate that. In many countries, the rebasing is done every five years, and no less than every 10 years. For a variety of reasons, this has not happened in Pakistan. Pakistan has only rebased twice, in 1969 to the 1960 base year, and in 1988 to the 1980 base year. Up till this year, the economic statistics were using the 1980 profile of the economy, a hopelessly out of date profile. In 1997, the Nawaz Sharif government began the technocratic process of rebasing. This process, which involved IMF representatives, was completed this year, and the economy was rebased to 1999 data.


The effect of rebasing was dramatic. In India’s case, they rebased in 1998 to 1994 as the new base year, and that is why comparative statistics show a huge leap forward for India in 1998. For Pakistan, the rebasing showed that the economy is actually a full 20% larger than previous statistics had shown. In fact, Pakistan’s economy is 95 billion dollars in size, with a per capita income of 650 dollars, which is about 15% above India’s. The purchasing power figures have not been generated yet, but should show Pakistan somewhat ahead.


In addition to the economy being larger, this statistical change means that other figures, like the amount of debt to the size of the economy, are better. The debt to GDP ratio is now 75%. And government spending (both education and military) and taxes are a smaller fraction of the economy than previously thought.


This rebasing doesn’t give a poor person a better job or send an illiterate girl to school. It does not bring credit to any single government, who should be judged more on the rate of growth than the size of the economy. But it does suggest that Pakistan, far from being a failed state, is much more successful at development than many realized or have given credit for.
Welcome to Pakistan Link

This article was written in 2004 - therefore Pakistan has progressed much ahead!

 

[Vinod2070]

But the per capita income as per the IMF, WB and CIA sources (available at List of countries by GDP & - Wikipedia, the free encyclopedia) still don't say that Pakistan is ahead. IN fact they claim that India is slightly ahead.

And it is only because the IMF (or was it WB) recently changed the PPP calculation for India and China reducing their GDP in PPP terms by ~ 40%. I am not sure if such a recalculation was done for Pakistan or it was not thought to be required?

Even the nominal GDP per capita for Pakistan is bit lower than India as per all three sources.

Pakistan is also lower on the HDI index, so it suggests that while both countries are wretchedly poor but India is not worse off than Pakistan overall in human development.

Not that India compares itself to Pakistan in economic matters!

 

[opinion786]

bhangra12345;169987]This high spread indicates that there is not much competition in the market and it is a sort of virtual monopoly.

This you observed for Banking sector. That there is not much competition in market?

Banks State & Private

1. State Bank of Pakistan
2. First Women Bank Limited
3. National Bank of Pakistan
4. Allied Bank of Pakistan, Karachi
5. Arif Habib Bank Limited, Karachi –
6. Askari Bank, Rawalpindi
7. Atlas Bank, Karachi
8. Bank AL Habib, Karachi
9. Bank Alfalah, Karachi
10. BankIslami Pakistan Limited, Karachi
11. Crescent Commercial Bank, Karachi
12. Faysal Bank, Karachi
13. Habib Bank, Karachi
14. Habib Metropolitan Bank, Karachi
15. JS Bank
16. KASB Bank, Karachi
17. Muslim Commercial Bank (MCB), Islamabad
18. Mybank Limited, Karachi
19. NIB Bank, Karachi
20. PICIC Commercial Bank, Karachi
21. Saudi Pak Non-Commercial Bank, Karachi
22. Soneri Bank, Karachi
23. United Bank, Karachi
24. Bank Of Punjab, Lahore

Foreign banks

1. Abn Amro Bank, limited Pakistan
2. Albaraka Islamic Bank BSC(EC), Lahore
3. American Express Bank Limited, Karachi
4. Mitsubishi Limited, Karachi
5. Citibank, Karachi
6. Deutsche Bank AG, Karachi
7. Habib Bank AG Zurich, Karachi
8. Hongkong and Shanghai Banking Corporation, Karachi
9. Oman International Bank SOAG, Karachi
10. Standard Chartered Bank Limited, Karachi
11. Barclay Bank, Karachi


Development financial institutions

1. Pakistan Industrial Credit and Investment Corp Limited, Karachi
2. Pak Kuwait Investment Company Limited, Karachi
3. Pak Libya Holding Company Limited, Karachi
4. Pak-Oman Investment Company Limited, Karachi
5. Saudi Pak Industrial and Agricultural Investment Company (Pvt) Limited, Islamabad
6. House Building Finance Corporation, Karachi
7. Investment Corporation of Pakistan, Karachi
8. National Development Finance Corporation, Karachi

Specialized banks

1. Industrial Development Bank
2. Punjab Provincial Cooperative Bank
3. SME Bank
4. Zarai Taraqiati Bank

Investment banks

1. Al-Towfeek Investment Bank Limited
2. Asset Investment Bank Limited
3. Atlas Investment Bank Limited
4. Crescent Investment Bank Limited
5. Escorts Investment Bank Limited
6. First International Investment Bank Limited
7. Fidelity Investment Bank Limited
8. Franklin Investment Bank Limited
9. Islamic Investment Bank Limited
10. Jahangir Siddiqui Investment Bank Limited
11. Orix Investment Bank (Pakistan) Limited
12. Prudential Investment Bank Limited
13. Trust Investment Bank Limited

Micro finance banks

1. The First Micro Finance Bank Limited
2. Khushali Bank
3. Karakuram Bank
4. Network Micro Finance Bank
5. Pak Oman Micro Finance Bank
6. Rozgar Micro Finance Bank, Karachi
7. Tameer Microfinance Bank Limited

Islamic banks

1. Dawood Islamic Bank Limited
2. Dubai Islamic Bank
3. Meezan Bank
4. AlBaraka Islamic Bank
5. BankIslami Pakistan Limited
6. Emirates Global Islamic Bank

 

[opinion786]

But the per capita income as per the IMF, WB and CIA sources (available at List of countries by GDP & - Wikipedia, the free encyclopedia) still don't say that Pakistan is ahead. IN fact they claim that India is slightly ahead.

And it is only because the IMF (or was it WB) recently changed the PPP calculation for India and China reducing their GDP in PPP terms by ~ 40%. I am not sure if such a recalculation was done for Pakistan or it was not thought to be required?

Even the nominal GDP per capita for Pakistan is bit lower than India as per all three sources.

Pakistan is also lower on the HDI index, so it suggests that while both countries are wretchedly poor but India is not worse off than Pakistan overall in human development.

Not that India compares itself to Pakistan in economic matters!

Yes the article mentions this recording by these world institutions.

India re-based in 1998 and hence the giant leap forward in recording.

Anyway, I do acknowledge Indian economy progress. But, it doesn not mean that we dis-credit our Pakistani leadership for what it has done, envisoned and achieved! We have progressed far much under Musharraf!