Pakistan Economy - News & Updates

[SinoIndusFriendship]

Pakistan, Denmark to explore trade prospects ​

KARACHI: Ambassador of Denmark Anders Hougaard has expressed that presently Pakistan and Denmark were facing bilateral trade deficit.

This he said during his visit to the Karachi Chamber of Commerce and Industry (KCCI) on Friday.

Acting President KCCI, Muhammad Ali welcomed him and expressed his gratitude towards better relationship among the governments and people of both Pakistan and Denmark.

Ambassador of Denmark informed that his visit to the KCCI was to invite the private sector of Karachi to initiate B2B (Business to Business) meeting with their Danish counterparts in order to explore new bilateral trade prospects. He stated that Danish Embassy in Islamabad would be pleased to facilitate for arranging the B2B meetings of Pakistani and Danish businessmen. He said that great potential of bilateral trade does exist, which was not properly utilised in the past. He asked the acting president KCCI to encourage the interested KCCI member companies for bilateral trade.

Ali was of the view that the private sector of both countries must come forward and identify the potential items for bilateral trade to enjoy friendly economic relationship. He drew the attention of the Danish ambassador towards exports potential in textile products, leather goods, agro-based products, handicrafts, surgical and sports items.

He also asked the Danish ambassador for deliberation on the prospects of joint ventures in dairy farming, agriculture machinery, light engineering and alternate energy solutions. staff report

Denmark has serious problems against Muslims and non-whites. Mmmmm????

 

[Omar1984]

Investment Promotion and Protection Act: MoI formulating law for investors’ protection ​

By Sajid Chaudhry

ISLAMABAD: Ministry of Investment is planning to give the country a unique legislation-Investment Promotion and Protection Act-to protect local as well as international investors against political victimisation and ensuring continuity of economic policies in the country, Waqar Ahmed Khan told Daily Times during an exclusive interview here on Friday

The act of parliament would require the future government to honor in letter and spirit the investment agreements as well as Memorandum of Understandings signed by the government of Pakistan.

Legislation, first of its kind in the world, aims at protecting the investors from adverse changes in economic policy in subsequent governments as well as protection against political victimisation, Federal Minister for Investment, Waqar Ahmed Khan said. He said that draft of this unique legislation would be ready by next four months and after having consultation with federal ministries and provincial governments as well as after seeking advice from Supreme Court of Pakistan it would be presented before the Federal Cabinet for initial approval.

Although the constitution of the country provides protection to the investors under investment agreements signed with the present day government against unfavorable treatment in the future governments. However, this kind of protection is mainly available to the foreign investors only and local investors don't have any such protection. Some time, change in the government, put the investors in to difficulties in new set up and they face undesired situation resulting in outflow of investment from the country, he added. The investors have no choice to create political linkages in present political set up as well as future set to protect their investment as well as their rights.

He was of the view that for finalisation of draft of the Investment Promotion and Protection Act, changes or amendments in many existing laws would need to be made. While citing example of Investment Act 1976, he said that this law is totally outdated and doesn't meet the present day needs. Similarly, Economic Reforms Act, Land Laws, Securities and Exchange Commission of Pakistan's law, Tax Laws and other number of laws would be required to be amended so that aim of protection and promotion of investment in Pakistan is achieved.

He said that after enactment of new law by the Parliament, the investors would be protected in a way that they would not need to create political linkages in future political set for protection of their investment in Pakistan.

The new law would provide appeals in higher courts instead of lower courts for the speedy settlement of investment disputes between the parties in this regard, first stage of appeal is proposed to be high courts against the existing practices, he added. In this regard, The Ministry would also approach Supreme Court of Pakistan for seeking proper advice and guidance.

He said that to make this legislation more competitive to meet the international requirements, a legal experts group is to be formed including experts of international repute in the areas of investment, taxation, dispute settlement, international law as well as other domains. This expert group would be asked to recommend measures for making the proposed legislation according to the best international practices for promotion and protection of investment in the country.

He informed that new legislation aims at minimising chances of disputes with international investors by clearly defining the rights and obligations of the local as well as international investors.

He said that Pakistan is pursuing the most liberal investment policy in the South Asian region, new incentives and further liberalization measures including reduction in foreign equity from $0.5 million to $0.3 million, technology and special incentives including tax relaxation is being given on the projects of social, service, infrastructure, agriculture and international chain of food franchises. We are also offering zero import duties on capital goods, plant, machinery and equipment (not manufactured locally) without discrimination to both local and foreign investors.

The Federal Minister also said that investors who invest in the newly opened sectors can import plant, machinery & equipment on concessional rates and they can also avail first year allowance of 50 percent of the cost of plant, machinery & equipment. Zero import duties on raw materials used in the production of exports is also being offered.

Waqar Ahmed Khan further said that a large number of tariff and non-tariff barriers are being removed, and the negative and prohibited list of imports has also been reduced, export incentives are being broadened and Ministry of Investment is putting its best efforts to modify the visa policy of Pakistan to make it more attractive to the foreign investors. Besides, Special Industrial Zones (SIZs) are being established with hefty fiscal incentives to attract foreign investment in export-oriented industries. An important achievement of Ministry of Investment in this period is that the various foreign potential companies are showing their keen interest to explore the untapped resources especially in power generation, oil and gas, agri-farming, affordable housing, infrastructure and engineering sectors, he added.

The Minister said that investment, particularly foreign direct investment (FDI), is now perceived in many developing countries as a key source of much-needed capital, advanced technology, and managerial skills. Realising its central importance to economic development, the present government has taken wide-ranging steps to liberalise its inward investment regime and have succeeded in attracting substantial amount of foreign investment. Moreover, the present government is taking dynamic steps to further strengthen the fiscal graph of Pakistan 's economy. “We believe in open door policy and Government of Pakistan is earnestly trying to restore the confidence of foreign investors,” he said.

 

[Omar1984]

French companies seek investment opportunities ​

Staff Report

LAHORE: Reiterating her country's continued support for Pakistan in its efforts to overcome economic difficulties, French Minister for Foreign Trade Anne Marie Idrac said that French companies were looking at projects in the transport, energy, water treatment and food sectors.

The French foreign trade minister, who was heading a 21-member strong delegation comprising parliamentarians, executives of multi-national companies and government officials, was speaking at the Lahore Chamber of Commerce and Industry on Friday.

President LCCI Mian Muzaffar Ali, Senior Vice President Tahir Javaid Malik, Vice President Irfan Iqbal Sheikh, French Ambassador Daniel Jouanneau, Consul General in Karachi Pierre Seillen, Head of French Economic Services in Pakistan Dominique Simon and LCCI former president Mian Misbahur Rehman also spoke on the occasion.

The French minister said the private sector delegation accompanying her was a manifestation of her country's keenness to assist Pakistan officially and the President Nicholas Sarkozy would sign agreements with Pakistan government during his visit to Pakistan by the end of this year.

She said France wanted to open a new chapter of partnership with Pakistan because of the return of democracy and its resolve to fight out terrorism. She said that the President Sarkozy would sign agreements on defence, security, economy and energy.

She said the French companies would develop better partnership in the fields of energy efficiency in renewable and hydro energy projects. Several companies are already operating in Pakistan, she added.

The French minister also promised to extend cooperation in the field of agro-processing industry. By the end of this year, French agro-based industry would hold single country exhibition in Lahore, she added. Ms Idrac said a proposed partnership between Pakistan and France on civilian nuclear energy would be limited to nuclear safety and security.

"What we propose is something very important, which is the possibility for technical people to discuss very precisely what can be done in terms of safety and security for the existing civil nuclear plants," she said.

This question is to be settled within the framework of the international commitments to which France is a party, and any cooperation is subject to international agreements.

French Ambassador Daniel Jouanneau, while addressing the meeting said that all genuine businessmen would be accorded red-carpet treatment at the embassy but they had to wait for minimum three weeks to complete the visa process.

Speaking on the occasion, the LCCI president sought the help of French government in four fields including energy, environment, agriculture and transport. He said Pakistan's number one problem is energy and the country needs efficient, stable and cost-effective energy.

He said that Pakistanis are very grateful to the French government that they are once again considering providing us with the means to set up nuclear energy facilities. "No doubt this will contribute immensely to achieving an early equilibrium in our industrial and economic growth by alleviating our acute power shortages."

He said that Pakistan was deeply impressed by the advancements made by France in the field of alternative energy solutions and wants to get benefit from French expertise in this field. He said that the provision of nuclear energy and cooperation in the field of alternative energy will be a giant leap in fulfilment of the goal of progress and prosperity.

LCCI president urged the French minister to help Pakistan in producing fruits and vegetables in temperature-controlled enclaves and greenhouses etc.

"Despite the fact, that Pakistan has abundant fruit production, it lacks the facilities and the techniques for processing and preserving these fruits, which can easily be transferred to Pakistan by means of joint ventures.

He said that France has most efficient, highly developed and technically advanced transportation system in Europe and in order to develop an efficient transport system linking our cities and regions we need French support and cooperation. He also invited French hospitality and tourism industry to make investment in the north of Pakistan that has very scenic and breathtaking mountainous regions. In his concluding remarks, the LCCI president said he wants to convey to the world at large that Pakistan is a peace-loving nation and all apprehensions about the stability and safety of its nuclear assets are totally misplaced. "We assure you that the control and command structure of these assets is very secure and fully justifies our need of a nuclear deterrent to maintain the geo-political balance in our region."

 

[Omar1984]

Emaar Pakistan to launch sale of Mirador Villas ​

ISLAMABAD: Emaar Pakistan, the country subsidiary of global property developer Emaar Properties PJSC, will be offering sale of a limited number of fully-constructed Mirador Villas at the Canyon Views development in Islamabad on July 25, 2009. Sales of villas will be held at the Islamabad and Karachi Sales Center on a first come, first served basis. Emaar Pakistan is offering ready to move in villas at Canyon Views for those who missed booking in 2006. The launch of the limited selection of Mirador Villas will give prospective customers a golden opportunity to be part of a world-class community. staff report

 

[Omar1984]

Govt offers 53 blocks to exploration companies ​

LONDON: Pakistan has offered 53 blocks to exploration companies for competitive bidding on the occasion of the two-day Pakistan oil and gas exploration promotion conference which began here on Thursday.

In his keynote speech Prime Minister’s Adviser on Petroleum and Natural Resources Dr Asim Hussain highlighted the huge untapped exploration potential in Pakistan and said that total endowment of hydrocarbons in the country was estimated at 27 billion barrels of oil and 280 trillion cubic feet of gas of which only 3.4 per cent of oil and 19 per cent of gas had been explored so far.

Dr Hussain said that with a success ratio of 1:3 and highly attractive terms of engagement under the Petroleum Policy 2009 and availability of large number of acreages made Pakistan a land of opportunities for any hydrocarbon explorer.

Pakistan’s High Commissioner to the UK Wajid Shamsul Hasan highlighted the significance of strategic location of Pakistan and said that the country being a gateway to the energy-rich Central Asia, the financially liquid Gulf states and the East Asian tiger economies remained an ideal destination for investment. He said the oil and gas sector in Pakistan had seen phenomenal growth. Over the past half century the petroleum industry has played a significant role in economic development, by making large indigenous gas discoveries.

He further informed that Pakistan met about 15 per cent of its oil needs from local sources. Oil and gas are major components of Pakistan’s energy mix.

He said that the government sought to promote foreign investment in upstream petroleum sector with a view to exploiting indigenous hydrocarbon resources in an optimum manner for the benefit of the nation.

Special Secretary Petroleum and Natural Resources G.A. Sabir made a presentation on salient features of Petroleum Policy 2009 and briefed on lucrative fiscal terms for onshore and offshore exploration.

Mr Zahid Hussain, Chairman of the Oil and Gas Development Corporation, briefed on the geological aspects of oil- and gas-rich areas of Pakistan.

A large member of investors from the UK and multinationals already working successfully in Pakistan are participating in the conference.

 

[Omar1984]

Pak-Italy sign $100 million agreement ​

ISLAMABAD: Pakistan and Italy signed a $100 million agreement of financing ten projects within the framework of the Pakistan Italian Debt for Development Swap Agreement following the approval of the Management Committee, APP reported.

Under the debt swap, US$ 100 million would be utilized to finance development projects in Pakistan, mainly for social sectors like health, education and sanitation.

The agreement was signed by Secretary of Economic Affairs Division, Farrakh Qayyum and Italian Ambassador in Pakistan, Vincenzo Prati.

'The Italian government has offered to convert part of their loans into debt swap which could be converted into rupees and utilized in various social sector development projects,' Farrakh Qayyum remarked, APP reported.

He said that Italy has been proactive in assisting Pakistan in social sector developments, adding that it was already executing such projects in the country.

'In this extremely crucial moment for Pakistan, the Development Swap Agreement is an essential initiative undertaken by the Italian Government, which erases debt through the execution of development projects,' he added.

He said that a committee co-chaired by Secretary EAD and the Italian Ambassador was evaluating about 62 projects which he said would be allocated throughout Pakistan.

Speaking on the occasion, Italian Ambassador said that Italy would provide all possible support for the development of social sector projects in the country, adding that its projects were already under progress in northern areas.

He said that Italy would also launch a project of preserving the archaeological heritage in Swat valley on a sustainable basis, adding that the institute would also be made to serve this purpose, APP reported.

It may be recalled that the financial envelope of the approved projects, which is worth Rs.3.6 Billion and ready for implementation, represents almost half of the agreement.

The plan covers varied and essential fields of the social sector like health, education and sanitation, sustainable economy through micro-credit, community development, sustainable agriculture and environmental protection.

The parties have agreed upon an allocation of US$ 10 million for the internally displaced persons, which is to be negotiated with the concerned authorities of NWFP, with an aim to establish appropriate activities for a prompt rehabilitation of the areas affected by the war against extremism.

The projects, that are promoted and executed by NGOs, Italian NGOs and the public sector in accordance with agreed shares, will be allocated throughout Pakistan.

These include two mega integrated projects, one for the Northern Area that focuses on Central Karakorum National Park and its surrounding villages, and the other on the Frontier Regions of FATA.

Other projects focus on the commercialization and promotion of olive and olive products in Balochistan, NWFP and Punjab; construction of an International Center for Reconstructive Surgery; vocational training and shelter homes in order to assist the women victims of acid attacks in Punjab in their physical and social struggles; initiatives in Balochistan, Punjab and Sindh addressing kidney, eye-care services and micro-credit schemes.

The General Strategic Plan provides the basis to complete the commitment before the end of 2009 for the entire amount of the Agreement.

By launching Calls for Proposals, a balanced implementation share in geographic, thematic and organizational terms can be ensured.

The Italian Government is thoroughly engaged in finalizing two significant contributions to the regions bordering Afghanistan by offering micro-finance facilities of 40 million Euros and vocational training worth 20 million Euros.

 

[Omar1984]

Gilani proposes changes in draft trade policy ​

ISLAMABAD: Prime Minister Yousuf Raza Gilani said on Friday that export target has been missed owing to global recession and inability of his government to implement the measures envisaged in the trade policy for promotion of exports.

‘The export target of 2008-09 has not been achieved and there is a shortfall of $5 billion due to global recession as well as our inability to implement the measures that were envisaged under trade policy last year,’ the prime minister said while chairing a high-level meeting to discuss next year’s trade policy.

He underscored the need for implementing policies in letter and in spirit so that the desired results could be achieved.

The premier suggested a few changes in the draft policy which would be presented before the special cabinet meeting for approval on Monday before its announcement on the same day by the commerce minister.

A detailed presentation was given to the premier on salient features of the Trade Policy Framework 2009-12 and Trade Policy for 2009-10 by the Commerce Minister, Amin Fahim. It was attended by senior officers of the ministry.

An official statement said that the premier said that problems, like lack of competitiveness and market innovation, high cost of finance; unreliable power supply, tariff and non-tariff barriers and the law and order situation have severely impeded government efforts to achieve a meaningful breakthrough on the export front.

A source privy to the meeting told this scribe that the commerce ministry proposed an export target of $18.67 billion for the year 2009-10, a five per cent growth over this year export proceeds of $17.781 billion for the year 2008-09. Pakistan’s export proceeds were $19.1 billion in 2007-08.

With a 10 per cent growth, the ministry proposed an export target of $19.559 billion for 2010-11.

According to the source, the focus of the policy is on four areas: the government will announce a hedge fund to give loans to sick or slowing industries on low mark-up rates.

A proposal has been floated to give insurance cover to foreign importers, who did not feel comfortable to visit Pakistan for placing orders owing to prevailing law and order situation.

The commerce ministry has also proposed Inland Freight subsidy to reduce the cost of transportation of goods meant for export from upfront country. A special focus will be for promotion of engineering goods from the country under the proposed policy, the source added.

According to the statement, trade is the primary vehicle to achieve the vision of socio-economic uplift of the masses; therefore, expansion in trade not only serves as a vital factor in balance of payments but also helps generate jobs, increases productivity and brings wealth to the nation.

 

[Omar1984]

Pak-China Joint Economic Group to boost economic and commercial ties: Senator Waqar Ahmed Khan ​

ISLAMABAD, Jul 24 (APP): Federal minister for Investment, Senator Waqar Ahmed Khan said that Pakistan was encouraging potential Chinese companies for investment in country’s various areas, particularly in the direly needed energy sector. He was discussing investment scenario with a Chinese delegation led by the ,Chinese Ambassador to Pakistan Lue Zhaohui who called on the minister in his chamber, at Cabinet Division, today.

Federal minister said that China is our strategic partner and time tested friend and Pakistan attached the highest importance to China’s progress and prosperity.

He expressed satisfaction over the strength of bilateral relations which were underpinned by mutual interest and mutual trust.

The federal minister hailed China’s continued assistance in various fields and said that Pakistan would welcome more chinese companies to invest.

He also highlighted various areas for future Chinese investment which included; infrastructure, agriculture, health, construction of small and medium size dams and banking sectors.

“We have a special focus on the development of energy sectors, and offering chinese potential companies to invest, particularly in power projects like thar coal and conducting hydrological and geological studies”, he remarked.

Senator Waqar said that “we have technology in our neighborhood and Pakistan would welcome more Chinese participation in development projects and for this purpose we will ensure security and protection of Chinese investors in Pakistan”.

Federal minister for Investment apprised the Ambassador regarding high‑level task force meeting which was held to review the follow‑up actions taken on the President’s directives to expedite various cooperative agreements ,in areas including building of dams , thar coal project, transfer of hybrid technology cooperation between PARC and Chinese Academy of Agricultural Sciences (CAAS), export of northern areas fruits to china, MOUs on development of fisheries and sugarcane and the joint Pak‑China economic commission.

He also discussed other projects being executed by Chinese companies in rest of the country and Balochistan.

Senator Waqar Ahmed Khan said that both sides are making efforts for the convening of the joint economic group meeting to boost economic and commercial ties.

The federal minister reiterated Pakistan’s support for China’s sovereignty, stability, and progress and expressed his hearties felicitation to the Chinese’s government and its people on the eve of 60th anniversary of China’s independence.

The Ambassador of China hailed the government’s new liberal investment policies and strenuous efforts to resolve the issues of the investors.

He informed the minister regarding Chinese companies desire to invest in different areas of energy sector; including hydropower.

Ambassador assured the minister that China will take part in all the major projects to share their expertise with Pakistan.

 

[Hyde]

NADRA gets Nigerian contract for national identity system​

Updated at: 1220 PST, Saturday, July 25, 2009
NADRA gets Nigerian contract for national identity system KARACHI: National Database and Registration Authority (NADRA) has won a $1 million contract to develop National Identity Management System for Nigerian government. The project for National Identity Management Commission, Office of the President Government of Nigeria was competed by renowned foreign IT firms, which was won by NADRA.

A contract in this regard was signed in a prestigious ceremony held in Abuja, Nigeria between Deputy Chairman NADRA Tariq Malik and Director General and CEO of National Identity Management Commission, Office of the President of Nigeria Chris E Onyemenam.

 

[Omar1984]

Trade Policy targets $25bn textile exports by 2011-12 ​

Staff Report

KARACHI: The textile policy, formulated for three years envisions the export of the textile products to reach $25 billion in next three years, Rana Farooq Saeed Khan, Minister for Textile Industry has said.

Speaking at dinner meeting hosted in his honour by Tariq Saud Vice Chairman All Pakistan Textile Mills Association (APTMA) on Friday night he said that the government is determined to address the problems of textile industry.

Minister said that the Textile Policy has been finalised and would be issued soon. He further informed that the policy has been formulated for next three years in such a manner so that the export of textile sector may achieve a target of $25 billion in next three years.

The policy will address the issues of up-gradation of machinery, provide infrastructure facilities and skill development of human resource of this industry so that they can compete in international market with their competitors.

Minister for Textile Industry further informed the meeting that the Spinning and Weaving Sector would get its due share from the Export Investment Support Fund, worth Rs 40 billion allocated in the Federal Budget 2009-10.

Minister advocated immediate support to textile industry in the Parliament and also in the Cabinet Meetings because he is confident that only textile industry is capable enough to bail out Pakistan from the current economic crisis so that the government should help this industry.

Tariq Saud, Vice Chairman APTMA highlighted problems and issues being faced by the textile industry. He stressed that government should take immediate measures to tame the slowdown in the textile sector. He said that high cost of doing business is because of highest ever increase in the rate of interest, which has multiplied the problems of the industry.

He said that power shut downs may result in massive unemployment resulting in law and order situation. Negative growth of about 9 percent in largescale manufacturing is mainly due to high cost of doing business. Slump in the industrial growth has greatly affected export of textile items, he added.

He said that unprecedented increase in markup rates is one of the major cause of defaults in servicing the loans availed by the industry, hence, the volume of non-performing loans has reached to an alarming situation.

He urged the government to provide relief to the industry without any further delay and regain confidence of businessmen and industrialists otherwise the outcome of the current situation will result in high rate of loan default and closure of industry.

Dr. Waqar Masood Khan, Secretary, Ministry of Textile Industry while addressing the meeting said that preparation of Textile Policy was the main objective of this ministry.

He said that although we are 4th largest producer and 3rd largest consumer of Cotton but unfortunately now we are at number 12 in the international trade of textile products.

He assured that government will address the problems of Textile Industry without any further delay and he is confident that the first ever textile policy of Pakistan will address the problems and provide immediate relief to industry and make it competitive in international arena.

 

[Omar1984]

WLL users’ base widens by over 15 percent in 2008-09 ​

By Muhammad Yasir

KARACHI: The number of Wireless Local Loop (WLL) users' is on the rise, increasing by 15.69 percent in 2008-09 with the growing usage in various commercial sectors and small business across the country.

As per Pakistan Telecommunication Authority (PTA) latest statistics, the base of WLL have witnessed an addition of 0.410 million subscribers in the closing fiscal year amid the healthy competition on rates and services among operators. The WLL teledensity has reached to 1.6 units in 2009 from 1.4 in 2008. The outgoing fiscal year also witnessed contraction of wireless subscribers in November and December whereas it recorded robust growth users in April 2009 with 4.2 percent on year-o-year basis.

Telecom analysts said the WLL sector has added commercial sectors and small business like Public Call Office (PCO). The free on-net calls are benefited to the sales and services sector making their communication easier at cheaper daily line rent policy, they added.

The addition of connections has been posted through the multipe service packages of Wimax operators offering with wireless telephony services along with connection. Besides, some of the operators have also attracted good number of users by introducing mobile handsets on their connections of wireless technology. They added the WLL sector is also witnessed immense competition not only among the WLL players but also with cellular phone sector particularly in the rural cites of the country.

Pakistan Telecommunication Company Limited (PTCL) has added the highest number of users in its wireless users' base by 0.117 million, followed by Telecard and WorldCall who enhanced their subscribers by 0.108 million and 0.061 million in the closing fiscal year 2008-09, PTA data said. Their overall bases have reached 1.305 million, 0.620 million and 0.549 million, respectively.

Wateen, Burraq and Mytel-also served connections to 72,176, 45,224 and 19,349 customers with the healthy growth in recent fiscal year 2008-09. Wibe-tribe, the other player of the market also added 2,712 users on its network.

Analysts further said the WLL also started offering free calling minutes and text services along with value added services that also caused popularity of the services.

The services are frequently used for international call on its affordable call packages. The traffic of international calls has been increasing continuously in the current fiscal year.

PTA claims that WLL services are available across Pakistan in 14 telecom regions. It reported 100 percent coverage enhancement of WLL in various cities, towns and villages of the country. By the end of 2008, there are more than 12,000 cities, towns and village have been covered with network by operators which were only 11,000 by the start of 2008. Currently, there are more than 3,262 cell sites installed by WLL services in the country, PTA reported.

 

[Omar1984]

Federal govt to approve comprehensive law for SEZs soon ​

By Sajid Chaudhry

ISLAMABAD: Federal cabinet is expected to approve Special Economic Zones (SEZs) law and policy soon to provide the economy a sound industrial base through establishment of Special Economic Zones in all parts of the country including Federally Administered Tribal Areas.

Federal Minister for Investment, Waqar Ahmed Khan, confirmed Daily Times on Saturday that SEZ Act also containing SEZ Policy would be implemented in coordination with all four provincial governments, Azad Jammu and Kashmir government and FATA Secretariat.

Those making investment in SEZs would be given income tax exemption for 10 years and zone developers would also enjoy the same facility. There would be no restriction on industrial units setup in SEZs to sell their production within the country or export it.

Industrial units located in SEZs would be enjoying true zero rating for their imports and the imports of raw materials and all capital goods would be exempted from general sales tax, federal excise duty, withholding tax and customs duty.

A high-powered SEZ Board would be constituted with, Prime Minister as its chairman and all four chief ministers and Prime Minister AJ&K, federal ministers from all economic ministries, and all important national and international chambers would also be given representation in the said board.

Provinces and other federating units would approach the federal government for declaration of any area as Special Economic Zone, the minimum size of which is being fixed at 50 acres. Upon approval from the board, the area would be formally declared as SEZ and zone developers of international repute would be invited to develop their own investment these SEZs with all facilities at international standards for investors. Private sector would develop these SEZs and would also manage such so that interference of governmental organisations is totally eliminated within the zones.

SEZs Development Committees would be formed in each province headed by Chief Ministers with members from public and private sector so that SEZ concept is implemented in letter and spirit.

Under the SEZ policy federal government and provincial governments would provide all infrastructure and services including utilities like water, gas, electricity, telephone, internet and approach roads at gates of the proposed SEZs.

Federal government would also allow the investors to set up their own power generation units and in case excess power is available it could be sold to the distribution companies of WAPDA. To provide the investors ease of doing business in the premises of SEZs no official from provincial or federal department to be allowed to visit industrial units, accept prior approval from the competent authority in each province.

Developers and managers of the SEZs would be responsible for provision of all civic facilities to the investors. However, for facilitating them, Special Police Stations for each SEZ would be set up with educated police staff so that they could help the management of SEZ in case any need arises. Normal police and other law enforcement agencies would have no business inside the proposed SEZs.

Re-construction Opportunity Zones would also be covered under this important legislation for ensuring early achievement of duty free market access benefits from US markets. Introduction of SEZ concept in FATA would help early development of ROZs with the help of private sector and early development of SEZs in this part of the country would help generate much-needed employment opportunities for local youth who have no economic opportunity in their area and are falling victim of indulgence in terrorist activities.

To save the SEZs from land mafia's activities, the new law and policy on SEZs would determine 10 percent area of SEZ for housing and other civic facilities and 90 percent area of SEZ would exclusively be available for setting up of industrial units. Besides, SEZs are being established with hefty fiscal incentives to attract foreign investment in export-oriented industries.

 

[Omar1984]

‘Sindh taxation dept to modernise tax collection procedure’ ​

KARACHI: Provincial minister for Excise and Taxation, Mukesh Kumar Chawla said that KCCI must forward productive suggestions and proposals for the improvement of provincial taxation system.

While talking to KCCI members Saturday, he said that government of Sindh, in order to facilitate tax payers and enhance tax collection, has modernised its tax collection procedure by introducing computerised collection.

In this regard excise & taxation department has modified procedure for the collection of Infrastructure Cess through computer-generated challans issued by Pakistan Revenue Automation (Pvt.) Ltd. with cooperation of Customs Department, the minister said.

He said that following the better policy of the ministry, the department during the last fiscal year achieved revenue of Rs 14.7 billion.

He said that department was going through the process of computerisation and a comprehensive provincial taxation portal will be established within next two years, which would completely replace the manual system.

Approval for computerisation of the department was granted after deliberation of 8 years, however, at present the process is rapidly progressing and it would be linked with the customs and other relevant systems, he added.

He said that the computerisation of the department was designed in a smart way and tax payers could access their accounts online to assess their tax liabilities. He said that a plan is also underway to broaden the collection of tax through banks under which more banks would be authorised for the collection of provincial and local taxes.

He urged the registered taxpayers to pay their taxes promptly without any delay to reduce the chances of penalties. He asked the business community to strongly discourage illegal gratification demanded by any tax official.

Answering to a suggestion regarding dissemination of funds collected through motor vehicle taxes be given to the City Government to construct new roads and repair the existing, he informed that the same was already in practice and its proper utilisation accordingly depends on the City District Government.

Replying a query, he said that the ministry is trying to minimise the tax on Stage Dramas and cinemas industry so that the industry could be saved from a complete collapse.

Acting President KCCI, Muhammad Ali, urged for the simplification of provincial and local taxes system. In the present scenario there were multiplicity of taxes and levies imposed on trade and industry, therefore, a large number of businessmen were unable to pay their tax-liability on time and consequently they should be granted a leverage period of one year to pay their provincial and local taxes liabilities.

Moreover, he also demanded for the waiver of 100 percent penalties imposed in many cases of property taxes. He was of the view that property tax imposed on KCCI building should be exempted, as it was protected under the National Heritage. He proposed that taxes like vehicle tax, driving licence etc. should be taken as lifetime tax for the ease of tax payers.

Rasheeduddin Rashid, Chairman, Provincial, Local Taxes & Allied Matters requested the Minister to waive off the 100 percent penalties imposed alongside the property taxes which was delayed for payments due to uncertainty in the business activities. staff report

 

[Omar1984]

WEEKLY REVIEW: Re-launching of 18 scrips takes KSE 19.39 pts up ​

KARACHI: Bull reigned the Karachi stock market during the week on support from buying activities as Securities and Exchange Commission of Pakistan (SECP) approved the re-launching of deliverable futures contract in 18 scrips.

The Karachi Stock Exchange (KSE) 100-share index gained 19.39 points or 0.2 percent to close at 7,783.40 points as compared to 7,764.01 points of the previous week.

Other major factors that supported the market included approval of dividends for Letter of Comfort (LoC) unit holders of National Investment Trust (NIT), rise in international oil prices and renewed interest of foreign investors. The turnover was recorded at 193.04 million shares as compared with 183.81 million shares of the previous week, reflecting an increase of 5.02 percent.

“The SECP’s approval of 18 future securities and monetary policy statement prospects elated investors’ mood at the start of the week,” said analyst at JS Research Mustafa Bilwani. “SBP’s announcement of a delay in the monetary policy till August 15 dragged the market into the red on the last trading session of the week.

Foreigners continued to be the net buyers for the sixth week in a row. They bought shares worth $19.6 million and sold shares worth $14.7 million, resulting in net buying of $4.9 million. Hence, during the last 6-weeks, foreigners were net buyers of $36.9 million worth of shares.

Regional markets were in the positive zone on account of better than expected US economic data, where Dow Jones crossed the 9,000 points barrier for the first time since the start of the year. SSEA, PSI, Sensex, KOSPI and JKSE were up by 5.7 percent, 4.8 percent, 4.3 percent, 4.3 percent and 3.8 percent respectively. Currently, the local market is trading at 48 percent discount to region on one-year forward earnings multiple. Interestingly, with 4.3 percent rise in Indian market this week, the KSE 100-share index is now trading at 54 percent discount to Bombay Stock Exchange on earnings multiple.

FFBL and EPCL were among the major companies who announced their results this week. FFBL posted an earning per share of 53 paisas down 31 percent on yearly basis. UBL, Engro and FFC are the major companies, which will be announcing their financials in the coming week. Any positive earning surprises can be expected to lead to short-term rallies in these scrips.

“Investors remained optimistic for significant rate cut in the monetary policy,” said analyst at Shahzad Chamdia Sec Ahsan Mehanti. “Positions were taken in blue chips in oil, fertilizer and cement scrips on expectations of record payouts in the result announcement session, which also helped the market to stabilise.” staff report

 

[Omar1984]

Pakistani companies providing cheapest call rates world-over: Dr Yaseen ​

By Mian Abrar

ISLAMABAD, Jul 26 (APP): Chairman Pakistan Telecommunication Authority (PTA) Dr. Mohammed Yaseen Sunday claimed that Pakistani cellular phone companies were providing cheapest call rates across the globe.“In a recent conference in India, the Indians claimed that they were providing cheapest calls world over. However, I confronted and made calculations to prove that Pakistan was the country providing the most inexpensive phone facility to its consumers,” said Chairman PTA Dr. Mohammed Yaseen in an exclusive interview with APP.

When his comments were sought over the spill over of Pakistani cellular phone signals to the neighbouring countries, Chairman said PTA had conducted comprehensive surveys to ensure that there were no spillovers from either side.

“The cell phone towers are installed in the bordering areas under a prescribes Standard Operating Procedures (SOP). We are ensuring that the SOP is strictly followed. Moreover, we have held negotiations with the neighbouring countries including Afghanistan and India to address the issue,” he added.

Answering a question about the government’s ordinance on objectionable SMS, the chairman PTA said the government had issued the ordinance to establish a mechanism to check on those elements involved in the obnoxious SMS.

When asked about those involved in fraudulent activities and fleecing the poor consumers through SMS for cash draws, the PTA chairman said the Federal Investigation Authority (FIA) would move against such elements under Spam Regulations.

He said the PTA had installed a Redressal of Consumer Grievances Mechanism which would ensure proper resolution to the problems being faced by the telecom sector consumers.

Dr. Yaseen informed that the consumers would have a complaint with the respective telecom operator and if the issue is not resolved, the consumer should file the complaint with the PTA Consumer Protection Directorate (CPD).

“The consumers can make a free-of-cost call to PTA at 080055055 if their complaint is not resolved within given timeframe by the concerned telecom operator,” he said and added the PTA would take up the matter with the concerned authorities and would get it resolved amicably.

“We are providing level-playing field to all the operators and if any operator violates the laws, we would move for an action,” he assured.

He claimed that PTA was efficiently redressing the complaints of the consumers and the redressal rate stood at 96 per cent during the month of April.

When asked about the PTA-FBR row over the dues reportedly liable to the PTA, Dr. Yaseen said there was no controversy and PTA was paying its installments on a regular basis.

“We have paid Rs 4 billion to the Federal Bureau of Revenue (FBR),” he added.

Asked about the poor performance of the Pakistan Telecommunication Company Limited (PTCL), Dr. Yaseen said he had held a meeting with the PTCL management and they had assured of resolving all issues of the consumers by July-end.

He said the PTA would launch a survey to check the quality of services being offered by PTCL in the first or second week of August.

“Yes, a quality survey would be conducted in the first or second week of August, and if PTCL is found to be violating the laws inscribed in License, an action would be taken,” he remarked.

He said the PTA was also urging PTCL to allow other connections on PTCL’s Fiber to Home service.

When his comments were sought about the claims made by Telecom companies’ advertisements, Yaseen said the commercial practices and advertisements by the telecom operators should not be misleading, inadequate or unclear in terms and tariffs and there was clear and complete specification of tariff information, detailed billing information as per license conditions and publication of Code of Commercial Practice and Service Contract for the awareness of consumers.