Pakistan Economy - News & Updates

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FATA militancy cost Pakistan $ 2,146m​

PESHAWAR: Militancy in the Tribal Areas has cost Pakistan around $2,146 million while the fighting has so far killed over 3,000 civilians, a government report said on Wednesday.

The report – “Cost of Conflict in FATA” – prepared by the Planning and Development Wing of the FATA Secretariat said the social cost of the militancy was far greater than the cost of infrastructure, economic and the subsequent environmental loss.

However, it said the cost of the military operation “is beyond the scope of this report and would be worked out separately by the concerned agencies”.

The report put the social cost of the conflict at $1,109 million, the cost to security and internal displacement at $572 million, the environmental cost at $188 million, the economic cost at $119 million and infrastructure losses at $103 million.

“Pakistan is suffering a series of overlapping crises due to the conflict in FATA... and is need of immediate humanitarian assistance,” the report said.

 

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Stocks witness: net foreign buying after 15 months​

KARACHI: The last month of the previous financial year saw encouraging development in the shape of foreign funds inflow in the local capital market with net buying in the month of June.

The net buying of portfolio investment was recorded after 15 consecutive months of net selling in the stock market when it passed through its worst crisis in the history when foreign investors rushed out because of negative developments on various fronts during this period.

Although, the entire period under review was disturbing for the stock market players, however the imposition of floor in the stock market and post-floor period was more painful – both for local and offshore investors.

The outgoing month of June 2009 saw net buying by foreign fund managers in Pakistan stocks, according to National Clearing data. This is mainly in line with funds flowing to all emerging markets since last few months.

Although, analysts pointed out the net buying was mere $5.6 million in the month of June, which clearly signals that funds are slowly moving towards Pakistan that is now trading at 50 percent discount to regional markets on price earnings ratio. However, the unfortunate part is that the amount of funds that is being invested in Pakistan is far lower than the regional inflows.

A record net inflow has been seen in emerging markets in the second quarter of 2009 led by China, India and Brazil. But contrary to historical trend, the money coming to Pakistan is far less this time. This is mainly due to foreign investors’ bad experience as Pakistan market regulators put a price floor last year for more than 100 days and as a consequence MSCI downgraded Pakistan to Frontier Index.

For instance, fund managers net buying in Indian equity market was $800 million in June and it was more than $5 billion in the last quarter. Compared to this a nominal net buying of $5.6 million was seen in Pakistan in June and for the quarter ending June 2009 there was net selling of $29 million.

Some market participants think otherwise and noted that inflow in the month of June was largely attributed to routing of local money through foreign destinations by the local companies to minimise their impairment losses incurred during the floor period.

“They wanted to push the market as much as they can by the end of June so that the shares value could go up and in return they would have to book the minimum loss that they are bound under the regulations of apex regulator on quarterly basis,” an analyst commented.

 

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Pakistan should improve revenue collection from services sector​

ISLAMABAD (July 02 2009): India has improved its revenue collection remarkably from service tax which has become an example for countries like Pakistan to introduce such kind of tax on services. The FBR quarterly review issued on Wednesday thoroughly analysed service tax structure in India with viable recommendations to implement the same in Pakistan.

In line with the Indian service tax, Pakistan should endeavour to improve the contribution of indirect taxes from services sector. It means during 2007-08, there was a potential to realise Rs 100 billion but only Rs 66 billion was actually collected. It implies that roughly, there is a further potential of Rs 34 billion in Pakistan, which could be generated additionally.

In India, around 63 percent of service tax collection emanated from 10 services and remaining 40 percent has been spreading on remaining services. Like Pakistan, telephone services contributed the top collection. Surprisingly, while comparing Indian service tax top 10 revenue generating services, only two categories telephone, banking and insurance services have been taxed in Pakistan.

Interestingly, the contribution of telecommunication has been 70 percent of the total collection of services in indirect taxes in Pakistan against only 17 percent in India. Prima facie, this is a case of limited tax base of services as well as enforcement issue. Interestingly, tax compliance by the taxpayers from 2001-02 has been up to the mark in services as tax returns have been regularly filed. Actual issue is the low contribution of service sector in tax revenues.

The tax base of services is extremely narrow. There is an immediate need to augment the scope of services in tax net of FED in VAT mode. The most prolific services in Indian service tax which are out of tax net in Pakistan are suggested to be brought in the fold of FED VAT mode such as business auxiliary service, goods transport agency, insurance auxiliary service, maintenance or repair services, stock broker, consulting engineers and commercial or repair service. With the passage of time, gradual extension of base would be a great source of revenue generation among the service untaxed.

For greater simplicity and distortion free system of service taxation, uniformity of tax rate is essential. The services taxed under indirect taxation are subject to varying rates. In Indian service tax, uniform rate for all the services is applied. A uniform rate of 15 percent would be more reasonable for all services under FED or sales tax.

In order to improve collection and enforcement, separate set up of services tax administration can be helpful. Since services generate inadequate revenues except telecommunication, attention is paid to manufacturing sector on priority basis as bulk of revenues is generated by manufacturing sector. All the services in the net of FED and sales tax may be combined together into a new tax "Service Tax" like India. It would a serious step toward focusing on revenue generation through better enforcement and extension of base of services.

The GST in Pakistan is an appropriate tax for services but there may a uniform rate of goods and services. On the other hand, although base of FED on services is extremely limited but still there is a variation in the FED rates. The uniformity of tax rates between sales tax on goods and services, and FED on services will help in reducing distortions and bring equity. Pakistan can also improve its tax revenues from services by expanding the scope of taxes to the untaxed services.

There is also an option to combine all the services into a service tax in indirect taxes but again there might be a number of constitutional and administrative issues. One thing will be certain that it will be focused appropriately if combined.

Provincial governments have some comparative advantage in administering the sales tax on services. The identification of liable taxpayers and the maintenance of the tax roll are comparative advantages of the province because of its greater familiarity with the local economy. Since the sales tax on services is a provincial revenue source, there should be more incentive to assess and collect the tax than is the case under the present centrally administered system.

Finally, there might be some significant advantage to a co-ordinated collection of the sales tax on services, the professions tax and the urban property tax. A centrally administered system also has some advantages.

Staff is familiar with sales tax because the provincial government would find it difficult to enforce the tax where powerful local interests are involved. In the long run, given the objectives of a fiscal federalism, the best options are either (a to move the administration of provincial taxes to the federal government, on a "readiness" basis, or (b) to have provincial rate setting under a shared sales tax on services, the report added.

 

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$5.984 million foreign portfolio inflow recorded in June​

KARACHI (July 02 2009): After witnessing a continuous outflow of foreign portfolio investment from the country's equity market during last 15 months, a fresh inflow of $5.984 million of this mode of investment was seen in the month of June 2009. "The offshore investors' confidence seems to have been revived and they are coming back to invest in the local share market", an analyst said.

According to National Clearing Company of Pakistan Limited (NCCPL) data, a net outflow of $22.271 million was recorded in the month of May 2009 while the cumulative outflow of this mode of investment was seen at $637.681 million in the period from January 1, 2008 to June 30, 2009.

"The fresh inflow of portfolio investment in the local equity market is mainly in line with funds flowing to all emerging markets for last few months", Muhammad Sohail, a leading analyst and CEO of Topline Securities said. Although net buying was only $5.984 million in June, it clearly signalled that funds were slowly moving towards Pakistan, now trading at 50 percent discount to regional markets on price earnings ratio, he added.

However, the unfortunate part was that the amount of funds invested in Pakistan was far lower than regional inflows. A record net inflow was seen in emerging markets in the second quarter of 2009, led by China, India and Brazil. But contrary to historical trend, the money coming to Pakistan was far less this time.

"This is mainly due to foreign investors' bad experience as Pakistan market regulators put a price floor last year for more than 100 days and as a consequence MSCI downgraded Pakistan to Frontier Index", he said. For instance, fund managers' net buying in Indian equity market was $800 million in June and it was more than $5 billion in the last quarter. Compared to this, a nominal net buying of $5.984 million was seen in Pakistan in June and for the quarter ending June 2009 there was net selling of $29 million.

 

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Up to 3.6 million euro aid for IDPs: Germany links Pak-EU FTA with legislative reforms​

KARACHI (July 02 2009): Germany, increasing its humanitarian aid for internally displaced persons (IDPs) in Pakistan by one million euro to 3.6 million euro, has said Islamabad would have to change its laws as per WTO rules for signing a free trade agreement (FTA) with European Union.

"Germany stands ready to support Pakistan," said Dr Michael Koch, German Ambassador to Pakistan while addressing a press conference at a local hotel on Wednesday. Also present on the occasion was Dr Christian Brecht, Consul General of Germany in Karachi.

Terming the trade, instead of aid, as more attractive choice for his government for the new democratic government in Islamabad, he said the developing country was facing the challenge of extremism on its north-western border.

Referring to the United Nations estimates, he said due to hostilities between Pakistani troops and Taliban groups over two million people had so far fled their homes in Swat Valley and Fata and only 10 percent of the refugees could be sheltered in official refugee camps.

"The others are living in makeshift camps or with host families," he added. The granted funds, which Koch said would be distributed to German aid organisations, would particularly be used to help those IDPs, who could not be sheltered in refugee camps. In addition to distributing basic necessities and hygiene items, providing medical care for the refugees would be a priority, he added.

Calling the Swat Valley and Federally Administered Tribal Areas (Fata) as hard hit areas, the German envoy told the media that the Federal Foreign Office in recent weeks had already made 2.6 million euro available for humanitarian aid efforts being led by the International Committee of the Red Cross, the UN refugee agency (UNHCR) and German aid organisations.

"The Federal Foreign Office's 2009 humanitarian aid to Pakistan thus totals 3.6 million euro till date," he added. About the possibility of a Pak-EU FTA, the German envoy said the strict rules of GSP-plus (generalised system of preference) and World Trade Organisation (WTO) were the main criteria, to which the laws in Pakistan were not compatible.

"The so-called Free Trade Agreement is to be negotiated between the two... as long as you don't change the rules to make them compatible to that of WTO... this would unfortunately need more time," he added. Koch also clarified that the GSP-plus was making it difficult for his side to consider special concessions for the benefit of Pakistan or any other country of the world.

Asked if Germany was supportive to US drone attacks inside Pakistan, Koch said the deployment of around 4,000 German soldiers in Afghanistan under Nato/Isaf were responsible for the security in Afghanistan only. "We believe on this side of the border it is the Pakistani security forces that are and should be responsible for the security," he said.

The German ambassador also visited Karachi Port to get himself acquainted with an expanding port and is scheduled to visit the Trade Development Authority of Pakistan (TDAP) to explore the tremendous investment potential of the country.

"We encourage the German companies to exploit the great deal of potential in this country," said Koch, whose country is the 9th largest trading partner of Pakistan. Dr Christian Brecht Consul General of Germany said one of the objectives of the envoy's countrywide visit was to make the EU more recognisable to the authorities in Pakistan.

 

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Pakistan and China agree to increase land trade​

BEIJING (July 02 2009): Pakistan's Ambassador to China Masood Khan and Commissioner of Kashgar Prefecture Akbar Ghafoor have reiterated that land trade could be further increased through facilitation and removal of bottlenecks, a senior diplomat at Pakistan Embassy said here on Wednesday.

Both sides reaffirmed to enhance land trade during a meeting held on the sidelines of the 5th international trade fair at Kashgar, which started on June 28, said the Commercial Counsellor, Dr Naeem Khan. The meeting concluded that enhancement of trade can be achieved through frequent holding of high-level consultations between Xingjian and Northern Areas Administration of Pakistan.

Ambassador, Masood Khan, also met the representatives of Pakistan-China Business and Investment Promotion Council, who apprised him of the progress and activities of the Council in promoting trade between the two countries.

The Ambassador also addressed a reception hosted in honour of all members of Pakistani delegation by leading Pakistani exporters. The five-day Kashgar, Central and South Asia Commodity Fair attracted more than 12,000 businessmen, including about 800 from seven central and south Asian countries such as Tajikistan, Pakistan and Afghanistan, according to organisers. Over 70 exhibitors from Pakistan belonging to different trade areas were taking part in the fair.

Besides, these exhibitors, three delegations were representing Pakistan. They included Northern areas delegation led by its Chief Secretary Babar Yaqoob, NWFP delegation led by Minister Syed Ahmed Hussain Shah and third one led by Pakistan's Ambassador to China Masood Khan including senior diplomats.

The trade delegations from Northern Areas Chamber of Commerce and Rawalpindi Chamber of Commerce and Industry were also attending the exhibition. Food, textiles and clothing, gem and jewellery, machinery and electronic products are among the major goods for trading. The fair is conducive to 'building a good active economic relationship between Kashgar and other parts of China, and central and south Asian countries,' said Huang Sanping, a Kashgar official. Last year, transactions at the fair reached 24.3 billion Yuan ($3.55 billion).

 

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Dairy sector shows huge potential for growth​

HYDRERABAD (July 02 2009): Dairy is one of the expanding industrial sectors in Pakistan with currently about 23 units engaged in the production of various dairy products. However, presently almost all the dairy units are working below their capacities. Besides milk, milk powder and butter are also used in different dairy products. Not only as a product, it is also useful to cure various diseases.

There is great potential in Pakistani to produce milk and leather, which is in demand world-wide. Milk, as per requirement, is received from contractors and self-collection centres and also from former form through chiller plant vehicle.

According to the Economic Survey 2008-2009 the total production of milk was about 34.064 million tones in Pakistan. Punjab with a share of about 80 percent leads other provinces in milk production. Out of the total production of 135 million litres of milk per day, about 50 percent is consumed at source in the countryside, while the remaining 60 percent is traded in the urban centers.

Most of the traded milk is marketed un-processed and currently only 4 percent of the traded milk is processed by the dairy industry in Pakistan. The growth of processed milk should increase up to 10 percent as soon as possible. Not only through private channels, multi national companies shouls also be introduced in this.

Even the government should utilise part of the budget to built the government dairy plants. Thorough this unemployment will decrease especially 1200 veterinarian are jobless they will be engaged and with this income will generate for the betterment of the nation.

The shortage of the milk is mostly faced in the summer season; reason is its spoilage 30 percent milk spoil before reaching the consumers and due to shortage fluctuation in rates appears.

In the plant processed liquid milk in the form of pasteurised milk, sterilised milk or ultra heat treated (UHT) milk is the main dairy product in Pakistan, while other products include dry powdered milk, cream, butter, butter oil, yoghurt, cheese and ice cream, etc. If, food quality controlling (FQC) authorities consider to improve more quality of the dairy products there is no doubt we can generate exporting income through UHT treated milk and milk products.

 

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Tenth Five-Year Plan​

EDITORIAL (July 01 2009): Dr Mohammad Ehsan-ul-Haq Tasneem, Member, Planning Commission for Food and Agriculture, has said that the key imbalances in all sectors of the economy need to be rectified through an appropriate emphasis on agriculture, agro-business, industrial competitiveness, and on new initiatives for technology, energy and infrastructure in the 10th Five-Year-Plan (2010-15).

The agriculture and storage infrastructure would be improved at a total cost of Rs 38 billion. Further, the private sector would be the primary engine of economic growth and agricultural development. This would be achieved through vertical integration of high-value agriculture and livestock products.

Dr Ehsan also talked about the acute water shortage in the country, and disclosed that an integrated approach would be adopted, which would be guided by principles of equity, efficiency, participatory decision-making, sustainability, and accountability.

Public-Private Partnership needs to be vigorously pursued with respect to agriculture marketing and storage-and-supply chain infrastructure to enhance the effectiveness of public sector programmes. We hope the implementation of all these ambitious agriculture and agro-business projects would be achieved, with dedication, in a time-bound and cost-effective framework.

Dr Ehsan has rightly said that the emerging food crisis, in the wake of global food insecurity, has highlighted the need to revitalise Pakistan's agriculture sector to ensure sustainable food security in the country. The plan unveiled by the Member, Planning Commission, is comprehensive in its sweep and intent, and needs to be implemented in letter and in spirit.

Being an agrarian economy, Pakistan needs to put maximum emphasis on agriculture and agro-business, with its huge value-added potential. While over 60 percent of agriculture value-added is accounted for by such food crops as wheat, rice, maize, millet and sorghum, the share of major crops has remained substantially unchanged, due, mainly, to the paucity of inputs and research.

The share of food crops, particularly of wheat and rice, has increased over the last decade, though the share of cotton and sugarcane has fallen, which is reflective more of the movement of relative prices, than of production levels. Secondly, agriculture's share in the country's GDP has fallen by more than half, ie from about 53 percent in 1950, to approximately to 21 percent at present, due largely to the shifting policy thrust of successive governments.

However, despite its constraints, the agriculture sector has remained the single largest sector of the economy, and a credible guarantor of poverty alleviation. Infrastructure constraints in almost all sectors of the economy have warped the country's economic growth potential.

And the country's water and power sector has failed to deliver the required services, mainly because of infrastructure constraints. A serious lack of required storage capacity, whether for water or agriculture produce, has been mainly responsible for our failure in attaining sustainability, not only in agriculture, but also in the water and power sectors.

According to one estimate, some 30-maf of water, worth about $60 billion, flows down into the sea each year, unutilised which has not only harmed the country's agriculture sector; but it has also become a major cause of our failure in harnessing the country's huge hydropower potential. We have received huge funding from international lending institutions over the decades, though its targeted and timely utilisation has left much to be desired.

As Dr Ehsan has said, the challenge confronting the country today is to make agricultural growth pro-poor and equitable, for which a well-developed and efficient non-farm sector (agro-based, rural enterprises) is essential. Agriculture is the best hope for the revival of Pakistan's economy.

Successive governments in the country have, unfortunately, put greater stress on the formulation of policies and projects, than on their timely and cost-effective implementation. This has been true as much in agriculture, as in other sectors of the economy. There is an urgent need to activate the implementation arm of the government to achieve goal-oriented results. It is to be hoped that the implementation of the 10th Five-Year Plan, with its ambitious goals in agriculture and agro-business, will help revitalise the economy.

 

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Upgrading Quetta-Taftan track: Railways to seek $500 million ADB loan​

ISLAMABAD (July 01 2009): Pakistan Railways will seek $500 million from Asian Development Bank (ADB) to upgrade the Quetta-Taftan broad gauge track to international standard for launching the Economic Co-operation Organisation (ECO) container train for Islamabad-Tehran-Istanbul route.

Sources in the Railways Ministry told Business Recorder here on Tuesday that the feasibility study has been completed, according to which, total length of the track, from Quetta to Taftan, is 700 km, for which $500 million is required to make it capable for a train to ply at the speed of 145 km per hour.

The feasibility study will be submitted to the Planning Commission, they added. Iran and Turkey have a 'standard' gauge, but Pakistan has broad gauge, like India. The three member countries have taken a formal decision to launch container train from Islamabad on August 14, on trial basis, under the Transit Trade Treaty of 1959.

"However, in the first phase, these three countries will trade under the existing Transit Trade Treaty 1959 by December 2009, which would be revised from the next calendar year for 'ECO container train', and a subcommittee will be formed to propose amendments in the accord", sources added.

They said that a meeting would be held in July in Iran for financing arrangements in which Pakistan, Turkey, Asian Development Bank (ADB), Islamic Development Bank (IDB) and Bank of the Economic Co-operation Organisation will participate. Sources said that the launch of the Special Container Train service would give new dimension to trade between Pakistan, Iran and Turkey.

"The inter-state goods traffic has sufficient potential to make the venture a success, while extending rail service between the three countries would not only connect Islamabad, Tehran and Istanbul but would also strengthen inter-state trade development process," they added.

Sources expressed hope that the ECO, Islamic Development Bank and the governments of Iran and Turkey would assist in the development of Quetta-Taftan railway track, which would make the trip affordable, and reduce the transit time between the three countries.

 

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Foreign company plans to invest $3 billion in Reko Diq copper-gold mine​

KARACHI (July 01 2009): A foreign joint-venture company plans to invest up to $3 billion in Pakistan in a copper and gold mine, the venture's chief executive said on Tuesday. Tethyan Copper Co Ltd, a joint venture between Canada's Barrick Gold and Chile's Antofagasta Plc, one of the world's largest copper miners, has been granted an exploration license for the Reko Diq site in Balochistan.

The site's ore reserves, a mixture of minerals, are estimated at 4 billion tonnes, of which 0.5 percent is expected to be copper with 0.29 gram of gold per tonne of ore, Tethyan Chief Executive Cassie Boggs told Reuters in an interview.

"We think the investment is probably going to be between $2.5 and $3 billion," Boggs said by telephone. Tethyan is working on a feasibility study which is expected to be finished by early next year. The aim of the project is to exploit both copper and gold deposits, Boggs said.

Tethyan has a 75 percent interest while the government of Balochistan holds the remaining 25 percent. The project is expected to create up to 9,000 jobs in the construction phase, which will last for about three years, and then employ up to 3,000 people once the mine is operational. "Initially, we will need to probably bring in people from the outside with certain mining expertise," said Boggs. "But certainly, the plan is to train and develop the local workforce."

 

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'US bill to provide easy market access to Pakistani products'​

MULTAN (July 01 2009): United States is introducing a bill to provide easy access for Pakistani products into US markets, in September 2009, to facilitate local exporters and manufacturers, said Bryne-D Hunt, a principal officer of the American Consulate, while exchanging views with a former Punjab Minister and ex-President of MCCI Khawaja Muhammad Jalal-uddin Roomi, here Tuesday.

This function was also attended by officers of the District administration, including Commissioner Multan Syed Muhammad Ali Gardezi, DCO Khurram Ali Agha. Bryne said that the US administration had asked Pakistan to develop a roadmap based on workable proposals for enhancing bilateral economic relations.

He said that the United States would help Pakistan make these initiatives operational for enhancing trade and economic relations, for the benefit of the people of both countries. In this regard, Pakistan had been advised to ensure frequent visits of business leaders, so that the concerns of local investors were addressed and foreign direct investment from US was enhanced, he added.

He further informed that US authorities had renewed their commitment regarding the establishment of ROZs, and they were of the view that they were perusing the related legislation with US Congressmen and US Senators and the process would be completed in due time.

He further said that the United States was already financially assisting Pakistan for the rehabilitation of IDPs and the development of Southern Punjab, but the new willingness of USA and the G-8 ,which included United States, Japan, Britain, Russia, Germany, France, Italy, Spain, would supplement Pakistan's efforts for the development of Southern Punjab in the long run, providing basic facilities like roads, education, health and employment.

Khawaja Muhammad Jalaluddin Roomi said that there was no capital flight from Pakistan, foreign direct investment, remittances, revenues, foreign exchange reserves, stock market capitalisation were increasing and the country was enjoying the full confidence of the IFI's and foreign investors.

Current political events, in Pakistan, had not impacted Pakistan's economy as major economic indicators had witnessed positive growth, the economic fundamentals were strong, and the country's economy was progressing well to achieve sustained growth in the years to come.

Pakistan had also requested the US authorities to review its decision on the Travel Advisory on Pakistan and it was informed that this had been a major obstacle in enhancing trade and investment relations between the two countries. Roomi emphasised on the enhancement of Pak-US economic relations and the significant development of US contributions in the development of Pakistan.

If India was given access to Afghanistan through Wagah, their goods would enter Pakistani markets through smuggling by this TTA. Besides this, India would get easy access to the Central Asian States, through Afghanistan, whereas Pakistan was presently denied this facility through the TTA with Afghanistan, he added.

 

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Zardari seeks world help to rebuild economic infrastructure​

ISLAMABAD (July 01 2009): President Asif Ali Zardari on Tuesday said that the international community needs to recognise the economic problems of Pakistan created by the war against militancy and should step forward to addressing them in an effective manner in order to pursue the fight against militancy to its logical conclusion. He was talking to, Senior Director for International Economics of the US National Security Council, David Lipton, who called on him at the Presidency.

David Lipton was accompanied by US ambassador Anne W Patterson and Robert Dohner, Dy Asstt Secy for Asia of the Treasury Department, Shaukat Tarin, Advisor to PM for Finance, Secretary General to the President Salman Faruqui, Foreign Secretary Salman Bashir, Secretary Finance Salman Siddique, Secretary Commerce Suleman Ghani were also present in the meeting.

President Zardari said Pakistan had to rebuild its economic infrastructure damaged during the war, revive the closed industrial units, rehabilitate the over two million internally displaced persons, strengthen its civilian law enforcing agencies and undertake a massive programme for increasing literacy to help combat militancy.

The President said that the revival of closed industrial units also needed new power plants and hydel power projects. He said rental power plants would come up on line by the end of this year. In addition Pakistan was trying to build about a dozen small hydel power plants to overcome power shortage. The country also needed access to international markets for its product so as to generate jobs in the country, the President said.

 

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Ongoing projects: NHA to spend Rs 8,113 million during 2009-10​

ISLAMABAD (July 01 2009): National Highway Authority (NHA) has estimated spending of Rs 8,113 million during 2009-10 on the ongoing projects in the four provinces and Azad Jammu and Kashmir. It was revealed in a meeting, which was presided over by Federal Minister for Communications Dr Arbab Alamgir Khan.

NHA Chairman Chaudhry Altaf Ahmad and General Manager (Operations) Muhammad Sabir gave a detailed briefing to the Federal Minister, and told him that Rs 921 million would be spent on Punjab north projects; Rs 1,169 million on Punjab south projects; Rs 3,118 million on Sindh; and Rs 1,571 million on Balochistan.

Similarly, Rs 749 million will be spent on NWFP and Rs 585 million will be spent on Azad Jammu and Kashmir. Dr Arbab Alamgir Khan directed the NHA officials to complete the ongoing construction and maintenance projects as soon as possible. He instructed for the early completion of development projects in Balochistan in particular.

Addressing the meeting, the minister said that communications was the backbone of the country's economy, and wanted further up-gradation of linking it to our neighbouring countries to facilitate our trade, industry and tourism. The meeting was told that a total of 12,000-kilometre network of roads fell under the jurisdiction of National Highway Authority.

The officials said that the highway from Gwadar to Jewani was near completion and it would formally be inaugurated next month. They also said that our highways were of international standards and the Frontier Works Organisation (FWD) machines had been installed to check the standard of these highways, which would determine the standard of highways within minutes.

At the moment the Highway M-2 from Lahore to Islamabad is of the highest standard. State Minister for Communications Chaudhry Imtiaz Safdar Warraich, Communications Secretary Sharif Ahmad Khan, NHA Member, Operations, Pir Muhammad Akbar Rashdi, and Finance Member Zafar Iqbal Gondal and General Managers of all the regions participated in the meeting.

 

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Pakistan's forex reserves rise to $11.84 bln​

Reuters - Friday, July 3

KARACHI, July 2 - Pakistan's foreign exchange reserves rose by $70 million to $11.84 billion in the week that ended on June 27, compared with $11.77 billion the previous week, a central bank spokesman said on Thursday.

The State Bank of Pakistan's reserves edged up to $8.55 billion from $8.45 billion a week earlier. Reserves held by commercial banks fell to $3.29 billion from the previous week's $3.32 billion, the spokesman said.

Foreign reserves hit a record high of $16.5 billion in October 2007 but fell steadily to $6.6 billion by November last year, largely because of a soaring import bill.

Pakistan agreed in November to an International Monetary Fund emergency loan package of $7.6 billion to avert a balance of payments crisis and shore up reserves.

The central bank said on Wednesday it had received $500 million from the Asian Development Bank for a loan announced last week, receipt of which would be booked for the 2008/09 financial year that ended on Tuesday. [ID:nSIN478705]

The loan amount will be reflected in data on foreign exchange reserves to be released on July 9.

 

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Pakistan Gets $500 Million Loan From Asian Development Bank Central Bank​

KARACHI -(Dow Jones)- Pakistan Thursday received a $500 million loan from the Asian Development Bank to help with macroeconomic stability and fund a targeted safety net for the poor, a central bank spokesman said.

"The central bank has received $500 million from the Asian Development Bank, boosting foreign exchange reserves," said Syed Wasimuddin, spokesman for the State Bank of Pakistan.

A loan of $150 million from the ADB's Special Fund will target the Benazir Income Support Program, a cash transfer program focusing on poor women.

The remaining $350 million will help Pakistan move to more market-based pricing of wheat and electricity, remove subsidy distortions and improve a targeted social safety net, he added.

The amount will be added in the foreign exchange reserves data by next week.