Pakistan Economy - News & Updates

[Omar1984]

Rs125b projects to boost development​

The upcoming five-year plan for Information & Communication Technologies (ICT) would include projects worth Rs125 billion with an aim to utilise the extraordinary capacity of this sector to boost the country’s overall development, sources told ‘The News’.

Sources said a total of Rs25.07 billion would be allocated for software exports, Rs27.4 billion for the quality of IT education, Rs30.49 billion for e-governance, Rs1.05 billion for e-commerce and IT security, Rs1.3 billion for the promotion of Urdu language in IT, Rs3 billion for hardware initiative, and Rs37.5 billion for telecommunication and network infrastructure.

In the field of software exports, projects worth Rs25.07 billion would be initiated comprising IT market and industry size (Rs40 million), promotion of IT industry through media (Rs100 million), promotion of entrepreneurial start-ups (Rs80 million), development of effective Intellectual Property Rights (IPR) regime (Rs10 million) and awareness about opportunities for Pakistani companies (Rs20 million), establishment of business incubators (Rs200 million) and proactive match-making (Rs100 million).

The projects would also include the showcasing of brands (Rs500 million), interest free financing (Rs250 million), certification of companies (Rs800 million), mergers and acquisition (Rs400 million), establishment of internet city (Rs10 billion), building software technology parks (Rs10 billion), certification of ITeS/BPO (Rs400 million), study on investment guarantee (Rs20 million) and training of youth (Rs50 million), certification of individuals (Rs100 million), software technologies centre (Rs500 million), development of smart technologies programme (Rs500 million), and establishment of centre for cognitive science (Rs1 billion).

For the quality of IT education, project worth Rs27.4 billion would include vocational/technical skills programme (Rs15 billion), scholarships for IT education (Rs1.5 billion), IT infrastructure in educational institutions (Rs10 billion), centres of excellence for IT training (Rs440 million), establishment of IT placement centres (Rs100 million), capacity building of National Computing Education Accreditation Council (Rs60 million) and strengthening of boards of Technical Education (Rs300 million).

To promote e-governance, projects costing Rs30.49 billion would comprise development of e-services applications (Rs500 million), greater automation drive (Rs500 million), capacity building of departments (Rs400 million), infrastructure for public access to e-services (Rs400 million), building ICT infrastructure (Rs2 billion), incentives for promotion of IT (Rs10 million), training of government employees (Rs250 million), establishment of online access points (Rs300 million), expansion of e-services to rural areas (Rs100 million), public awareness programmes (Rs30 million), LRMIS for provinces (Rs1 billion) agency specific applications (Rs1 billion) e-government related ongoing projects (Rs3 billion), ministry of interior projects (Rs20 billion) and automation of CDNS (Rs1 billion).

The projects in e-commerce and IT security would cost Rs1.05 billion including awareness about information security (Rs30 million), cyber laws improvement programme (Rs50 million), establishment of certification authority regulatory (Rs500 million), Pakistan Internet Exchange (Rs100 million), e-payment solution (Rs200 million), Computer Emergency Response Team (Rs100 million) and development of e-commerce related services (Rs70 million).

For the promotion of Urdu language in IT projects costing Rs1.3 billion would be launched comprising availability of support for Urdu in international software products (Rs200 million), programmes for conversion of electronic knowledge sources (Rs200 million), development of SW & Content in Urdu language (Rs200 million), localisation of government websites (Rs400 million) strengthening centre of excellence in Urdu Informatics (Rs100 million), development of Urdu applications (Rs100 million) and training programme for localisation (Rs100 million).

In the field of ICT hardware, projects worth Rs3 billion would be initiated consisting of provision for free land to manufacturing concerns (Rs2.5 billion) and Investment Insurance/Guarantees Programme (Rs500 million).

Projects worth Rs37.5 billion in telecommunication and network infrastructure would include Alternate International Connectivity (TAE) (Rs4 billion), deployment of solutions for detecting and eliminating grey traffic (Rs500 million), secure communication programme (Rs1 billion), satellite communication programme (Rs32 billion).

Sources said the vision and strategy for the plan would revolve around ‘inclusiveness of ICT’ in transforming the socio-economic panorama and leap-forwarding into ‘knowledge era’ by providing ‘universal access to education, learning and knowledge sources’, shifting from ‘follower’ strategy to ‘value addition/leader’ strategy, transformation from government-centred policy to private sector-centred policy, and creating demand for local ICT products and services.

They said the salient features of the plan include increasing human resources with a qualitative edge, reaching out to the international market, addressing socio-economic problems by using IT, creating industrial synergy by involving local IT industry, enhancing domestic market, and provision of fiscal incentives and legislation.

Sources further stated that the plan would help face the growing challenges in the way of promoting education and human resource development, increasing information technology exports, enhancement of e-commerce and IT security, development of computer hardware company and supporting e-government.

 

[Hyde]

we have a huge potential in our software industry. Its a very good step to invest 25 billion rupees for IT market

We are growing like 50% every year and soon we can also perform a leading role in IT industry like India and Europe

 

[Omar1984]

CDWP approves 74 projects worth Rs 510.2 bln​

ISLAMABAD, Mar 18 (APP): The Central Development Working Party (CDWP) Thursday approved 74 projects costing Rs 510.2 billion, with a foreign aid component of Rs. 125.1 billion. The CDWP meeting, chaired by Deputy Chairman of the Planning Commission Sardar Assef Ahmad Ali, approved 36 projects costing Rs.326.0 billion of infrastructure sector, 26 projects costing Rs.158.0 billion of social sector and 12 projects costing Rs. 26.3 billion related to agriculture and industry sector.

With implementation of six power sector projects costing Rs 87 billion, shortage of power in the country would be controlled by efficient distribution and enhancement system of electricity by DESCOs.

The CDWP also considered five projects of water sector including Chashma Right Bank Canal costing Rs. 61 billion located in NWFP with capacity to irrigate additional about 300,000 acres of land.

A Committee under the chairmanship of Deputy Chairman, Planning Commission will finalize technical and financial details. Six flood dispersal structures on Nari River (Phase-I-II) in Balochistan were also cleared.

In addition, other small water sector projects relating to flood management and control were also considered.

Sixteen projects of transport and communication sector with a total cost of Rs 56.6 billion including mainly projects of Gwadar Deep Sea Water Port, Extension of M-4, Rehabilitation of Rasheed Wagon-Nasirabad Roads, Karachi Transport Improvement Projects, Kolpur Bypass and Bridge Across River Swan linking Attock and Chakwal were approved.

Main projects of social sector include mega vertical projects of health sector to provide improved health facilities to the masses. In this connection three projects with a cost of Rs. 93.7 billion approved namely Expanded Program on Immunization (EPI), GAVI Grant), National Programme for Family Planning and Primary Health Care.

The Lady Health Workers’ Programme costing Rs 53.0 billion was approved (Phase-II), and Prime Minister’s Program for Prevention and Control of Hepatitis was also approved.

Under President Development Package for NWFP, CDWP approved projects costing Rs 2.0 billion for medical equipment, ambulances for DHQ Hospitals in NWFP while blood transfusion services will be started all over the country.

Under President’s package for NWFP, 1,000 primary schools will be established in various districts of NWFP under a project with cost of Rs. 3.7 billion. The project will help promote basic education in the conflict affected areas of NWFP especially female education.

Main projects approved in agriculture sector included Pak-China Cooperation for Agricultural Research and Development (Phase-II) and Pak-China National Project for Improved Rice Processing which will assist in enhancing three to four times wheat and sugarcane production.

Storage projects such as Grain Storage Project, construction of steel silos of 650000 metric ton and Pak-China National Project for CA and advanced ventilated cold storage will enhance storage capacity by 6,50,000 MT while this will also save food wastage.

Similarly, REKO DIQ Gold and Copper project costing 8.7 billion was also approved. It will produce 38,000 tons of copper, 15,000 ounces of gold per year. Upon completion, income from the project will be about Rs 15.0 billion per year.

The CDWP also conceptually cleared projects of establishment of facilities for coal cleaning, coal gasification and coal combustion project to improve Financial Reporting and Auditing (PIFRA-II) (Phase-II).

The CDWP also approved establishment of 268-bed DHQ hospital Multan and establishment of Child Health Care institutes at Karachi and Sukkur.

Of the 74 projects, 63 projects costing Rs 365 billion will be financed by the federal government through federal PSDP while 11 projects costing Rs 145 billion will be financed by the provinces through respective provincial ADP.

 

[ajpirzada]

Shaikh likely to push Pakistani fiscal discipline



Friday, March 19, 2010
ISLAMABAD: Abdul Hafeez Shaikh, the man charged with steering Pakistan’s economy, has wide financial and management experience and is likely to focus on tight fiscal discipline as inflation remains a threat.

Shaikh, a former privatisation minister, will be put to the test as Pakistan’s weak government attempts to energise a struggling economy battered by a Taliban militant insurgency and starved of foreign investment.

He must also try to strike a balance between policy demands by the International Monetary Fund, which provides critical financial support for Pakistan, and the government’s desire not to alienate voters who could be hurt by those policies.

Shaikh will not be a full-fledged minister as he is not a member of parliament, but he is expected to have the same level of authority.

Shaikh’s background as a general partner in the growth capital company New Silk Route Partners, which focuses on private equity opportunities across Asia and the Middle East, suggests he will pay close attention to market needs.

“He understands the local economy and also has the skills to negotiate with the IMF and other bilateral and multilateral donors,” said Asad Iqbal, managing director at Ismail Iqbal Securities Ltd.

Having served as World Bank country head in Saudi Arabia, Shaikh will be in tune with what Pakistan needs to do to secure sustained international financial support — raising taxes, taming inflation and generating more revenue to meet expenditure. But President Asif Ali Zardari will likely fight some tough measures for fear they could trigger social unrest and make him more unpopular.

Shaikh, 55, served as privatisation and investment minister during the turbulent nine-year rule of former president Pervez Musharraf, a stint that may prepare him for uncertainty under Zardari.

During that period, he concluded transactions worth $5 billion.

Shahid Shah adds from Karachi: Economic analysts have welcomed Shaikhís appointment of as finance advisor, but expressed doubts on his success in a corrupt system.

Abid Hasan, a former advisor to the World Bank told The News, said that Shaikh enjoys credibility in both international and local circles.

He is qualified and a man of integrity, he said. “But the problem is our system, which is corrupt. Whether it will accept him or not remains a question.” Hasan said in a country where a large number of parliamentarian and even judges do not pay taxes, a person like Hafeez Shaikh stands little chance of success.

A good person is better than an incompetent person. But at the end of the day, I wish him good luck.”

Economist Kaiser Bengali said Shaikh could make a difference if he adopts sound economic policies. “It is not the matter of individual, but the policy.”

Shaikh likely to push Pakistani fiscal discipline

 

[ameer219]

Spot rate reduced by Rs 50, business improves on cotton market
Business Recorder [Pakistan's First Financial Daily]


KARACHI (March 19 2010): Slight improvement was seen on the cotton market on Thursday as some needy buyers made purchases to meet the near term needs, dealers said. The Karachi Cotton Association (KCA) official spot rate was lowered by Rs 50 to Rs 5450, dealers said.

In the ready business above 5000 bales of cotton changed hands between Rs 5200-5400. Phutti prices in both the Punjab and Sindh were at Rs 2100-2200, they added. Market sources said that some mills were active to make new purchases to meet the immediate needs as ginners were looking in flexible mood.

The ginners were keen to sell the unsold stock to save themselves from the losses, they said adding that it is likely that the prices may show further softness in the near future. Commenting on the strike they said that nearly 300 spinning mills are closed in protest against the ceiling on the exports of cotton yarn.

The Pakistan Cotton Ginners Association (PCGA) issued its fortnightly phutti arrival report till March 15 at 12.683 million bales and unsold stock is nearly above 0.3 million bales, which is not enough to meet the local demand, brokers said.

On Wednesday the NY cotton futures settled lower on sales by small investors as the market treaded water in range-bound dealings, with more of the same trading pattern expected this week, brokers said. The key May cotton contract fell 0.67 cent to end at 81.17 cents per lb, dealing from 80.86 to 81.90 cents.

The range stayed within Tuesday's 80.11 to 81.95 cents band. July cotton shed 0.40 cent to finish at 81.99 cents. New-crop December lost 0.52 cent to end at 74.55 cents. Volume traded in the May contract was at a modest 5,543 lots at 2:45 pm EDT (1845 GMT).

The following deals were reported: 3000 bales of cotton (exporter to mill) sold at Rs 5300, 600 bales from Multan at Rs 5300, 1000 bales from Haroonabad at Rs 5200 -5300 and 400 bales from Kabula at Rs 5400.

 

[Omar1984]

Appointment of new finance advisor to give impetus to economy​

ISLAMABAD, Mar 19 (APP): Prime Minister Syed Yusuf Raza Gilani Friday said appointment of an experienced economist as Advisor will give fresh impetus to the management of Pakistan’s economy.Welcoming the new Finance Advisor Abdul Hafeez Shaikh, who called on him here at the PM House, the Prime Minister said his appointment at this juncture will send a strong signal to the investors, business and trade circles about the government’s commitment to economic reforms, financial management and growth that is beneficial for all.

The Prime Minister expressed confidence that the induction of an economist in the cabinet will help calibrate policies for boosting the economic growth.

The Prime Minister said the economy should focus on creation of economic opportunities and employment to help improve quality of life of common man.
He said the government through stringent measures had been able to check the downward trend of economy and bring about stability. He said now there was a need to prioritize the specific areas contributing towards sustainable economic growth.

The Prime Minister asked the Economic Advisor to monitor the fundings of the special initiatives of the government for the poor like Benazir Income Support Program (BISP) and Wasela-e-Haq Programme.

The management of circular debt of energy sector was also a matter of immediate concern to help ease the power shortage situation in the country, he added.

Thanking the Prime Minister for reposing his confidence, Dr. Abdul Hafeez Sheikh assured to implement the government’s economic agenda in accordance with the priorities determined by the government.

 

[Omar1984]

 

[ajpirzada]

Abdul Hafiz vows to improve living standards of people
Updated at: 0401 PST, Saturday, March 20, 2010
ISLAMABAD: Newly appointed Finance Advisor Dr. Abdul Hafeez said Friday such financial planning would be evolved which will help boost economy and improve the living standards of people, Geo news reported.

This he said talking to Geo news after calling on PM Yusuf Raza Gilani here in Islamabad.

Detailing on the meeting, he said we discussed financial policies of government and ways to bring improvement into them.

PM hoped with the appointment if Abdul Hafeez as financial advisor growth in investment sector will be seen and the trade activities will get a boost.

The Premier said, the issue of circular date will soon be resolved in order to get rid of power crisis.

There is room for growth in Pakistan economy, advisor said on the occasion.

Abdul Hafiz vows to improve living standards of people - GEO.tv

 

[AZADPAKISTAN2009]

This guy has big nose he will do fine

 

[PakSher]

I kind a agree with the long nooooooooosssssssseeee comment.

 

[Luftwaffe]

Banks in shock as EOBI cheques fail
Tuesday, March 23, 2010
The News

KARACHI: Cheques of a local financial institution, amounting to Rs.31 billion, have bounced — the biggest such default in the history of Pakistanís financial sector, bankers said on Monday.

Several leading treasurers of financial institutions claimed that the Employees Old-age Benefit Institution (EOBI), which falls under the ministry of labour, placed an order to buy treasury bills worth 31 billion rupees with more than dozen banks and development financial institutions.

The deals were duly made, but at the time of clearance, none of the cheques were honoured because the authorised signatures did not match banksí records, they said.

No official comment was available from EOBI when contacted.

But one of its officials, who spoke on the condition of anonymity, said that he has also learnt from the market sources that cheques had bounced. He, however, said EOBI’s does not lack funds and has a bank balance of Rs41 billion.

 

[ejaz007]

Circular debt hits E&P companies
Drilling drops 22pc in first 8 months of FY10
Thursday, March 25, 2010
By our correspondent

KARACHI: The rising circular debt has even hit the oil and gas exploration sector, where drilling activities dropped by 22 per cent during the first eight months of the current fiscal owing to the liquidity crunch, an official of the ministry of petroleum said on Wednesday.

Only 67 wells have been drilled so far, including carry-over wells, compared will 86 wells during the same period last year, said the official, requesting anonymity. He said if carry-over wells of the last year are excluded from this total, the number of new wells remains only 40 this fiscal — 11 wells lower than last year.

Oil and Gas Development Company (OGDCL), which covers 30 per cent of the country’s exploration area, drilled 27 wells as an operator, including carry-over wells, compared with 41 wells last year. Pakistan Petroleum (PPL) drilled only one development well as the company largely operates through joint ventures.

Currently, circular debt has risen to a whopping Rs250 billion to-date, said the official, who attended the Senate Standing Committee meeting on Finance. “Last year, the government issued term finance certificates worth Rs175 billion to resolve the circular debt issue and improve the financial health of the state-run companies,” he added by saying the issue remained unresolved.

During the last year, the combined receivables of the major listed companies OGDC, POL and PPL rose by around Rs24billion, he said.

Had this amount not withheld by the refineries and gas-marketing companies, these companies would have drilled 35-40 more wells, the official said. This is assuming — average daily appraisal/development cost of $30-35,000 and an average of 150 days to complete a well, officials say.

Farhan Mehmood, head of research at Topline Securities, said developing existing reserves remains as important as finding new hydrocarbon reserves. “Out of 50 development/appraisal wells targeted for FY10, companies drilled only 27 wells during the first eight months of this fiscal.

Last year, 37 wells were drilled during the same period,” he said. “On the exploration side, performance was at par relative to last year.” Industry sources said that poor law and order situation in parts of Pakistan, especially Balochistan and northern parts of the country, were also hampering new drillings.

Farhan, however, said persistent liquidity crunch, led by circular debt, has become a new factor to hit the drilling activity. During this period, eight oil & gas discoveries have been made compared with the five of last year.

Circular debt hits E&P companies

 

[ejaz007]

Petroleum ministry to offer new exploration blocks in June
Thursday, March 25, 2010
By our correspondent

KARACHI: The Ministry of Petroleum will offer new blocks in June to expedite exploration of oil and gas reserves as the country fights severe energy crisis, Secretary Petroleum, Kamran Lashari, said on Thursday.

The blocks will be offered to local and international exploration production companies, just months after 40 leases were auctioned under the new petroleum policy, he said here on sidelines of Shell Eco-Marathon’s launching ceremony.

“We will offer nine or 10 blocks in June including one offshore lease,” he said, adding the petroleum ministry was also working on a separate policy for exploiting tight gas reserves. He said it was wrong to say that work on Mashal liquefied natural gas import project has stalled as talks were underway for construction work to start soon. “But we have to realize that there are no quick solutions to the present energy crisis.”

Shell Pakistan, Chairman and Managing Director, Zaiviji Ismail, said his company was committed to meeting energy deficit by focusing on the upstream sector. However, he said distribution margins on sale of petroleum products are not satisfactory. “Pakistan is offering the lowest margins to oil marketing companies in the region.

Petroleum ministry to offer new exploration blocks in June

 

[ajpirzada]

Pasha panel envisages 5% GDP growth rate



Sunday, March 28, 2010
By Mehtab Haider

ISLAMABAD: The panel of economists led by Dr Hafeez A Pasha has envisaged an average GDP growth rate of five per cent over the next five years (2010-2015) ranging from 3 per cent to 6.8 per cent from 2009-10 to 2014-15 respectively in its report, which will be submitted to the government on April 10.

The panel also recommended that the government should end loadshedding by improving power generation over the next five years that will give an impetus to economic growth on sustained basis.

However, the panel of economists avoided plunging into controversy on exact poverty figures as there was no number given in the finalised report contrary to the draft report in which the panel had estimated that 38 per cent of population was living below the poverty line. The decision to give 38 per cent population living below the poverty line faced severe criticism because there was no data available on poverty survey, having no basis to come up with poverty figures.

The Planning Commission and the UNDP’s joint venture -- the Center for Poverty Reduction and Social Policy Development (CPRSPD) -- estimated poverty level at 17.2 per cent on the basis of the latest survey done by the Federal Bureau of Statistics for 2007-08, but the government refused to own this figure despite validation done by the World Bank.

The panel of economists also envisaged increase in tax to GDP ratio in the range of three to four per cent in the next five years contrary to the government’s ambitious plan to jack up this ratio by five per cent, up to 15 per cent from existing ratio of over nine per cent.

Pasha panel envisages 5% GDP growth rate

 

[ameer219]

From today onwards, any posts on economy section on my side will be on this thread.


Germany has invested $39.2 million during this fiscal


KARACHI (March 28 2010): Germany has made an investment of dollar 39.2 million during the current fiscal year so far, Nasreen Ali Director General Board of Investment said here on Saturday. There is an ample opportunity to increase bilateral trade between Pakistan and Germany, she added.

She was talking to a four-member delegation of Pakistan-German Business Forum led by Saifuddin Zoomkawala. Dr Ismail, Mian Abrar Ahmed and some Board of Investment officials were also present on the occasion. Nasreen pointed out that only 2.97 percent of the global German investment is in Pakistan.

So the Pak-German Business Forum should carry out marketing among the German investors in an effective manner because Pakistan offers most lucrative investment opportunities in the region. For example, the cost of doing business is less as compared to China, India, Bangladesh, Sri Lanka, Egypt and Iran. She also said that a legislation on Special Economic Zone would be finalised soon.

The work on Japan Economic Zone is fast progressing. Similarly, special economic zones for other countries could also be set up. The delegation stated that it was working towards creating close relationship with the German investors and traders and with the co-operation of the BoI it would induce the German investors to invest in Pakistan more effectively.-PR

Copyright Business Recorder, 2010
Business Recorder [Pakistan's First Financial Daily]