Pakistan Economy - News & Updates

[Hyde]

Pak foreign reserves rise above $12 bn
​

KARACHI (Nida Siddiqui): The country’s liquid foreign exchange reserves crossed $12 billion mark – a level that has been regained after a 14-month gap - on consistent and heavy inflows, ARY News reported Thursday.

Chief spokesman of the State Bank of Pakistan (SBP), Syed Wasimuddin, told ARY News that the foreign exchange reserves have increased by $431.4 million to $12,269.8 billion during the week ended July 4.

With this upsurge, he said, the reserves of central bank have reached $8,963.8 billion, while the commercial banks hold $3,306 billion.

Economists say that loan grants from World Bank, International Monetary Fund, Asian Development Bank and Islamic Development bank besides some other multilateral agencies have been pushing Pakistan’s foreign exchange reserves consistently.

However, they believe, the complete inflow of $7.6 billion of IMF and other agencies would further increase the debt, which will finally expedite massive outflow of foreign exchange on account of debt servicing.

Source: Pak foreign reserves rise above $12 bn,7/10/2009 1:36:20 AM

 

[Neo]

Key details of Iran-Pak gas line not yet finalised ​

Friday, July 10, 2009

KARACHI: Pakistan has agreed to import gas from Iran through the multibillion-dollar pipeline without finalising important details which could jeopardise energy supplies to the country, people involved in the government’s energy planning told The News.

Deemed necessary for meeting burgeoning energy requirements of the country, an agreement on the price of gas was sealed with Iranian authorities in May this year after remaining on the backburner for years.

Iran has only named its vast Pars gas field from where it will supply Pakistan but there is no mention of the specific block, the network of wells which make up the petroleum reserves.

In his brief remarks to The News, Secretary Petroleum Mahmood Saleem confirmed that particulars like block to be designated for Pakistan and procedure for insurance of gas supplies were yet to be decided.

Experts point out this means an independent verification of reserves to ascertain whether they will be able to meet the country’s demand for the desired 25 years has still not been done.

Contrary to the impression that work will start in a year’s time, another important aspect that has not been thoroughly worked out by government officials is the mammoth financing requirement.

Any consortium of banks willing to finance the 2,100-km pipeline will seek government guarantee, which may not be satisfying since Pakistan’s credit rating is below acceptable level.

Help of international financial institutions, running under the influence of anti-Iran United States, will be hard to muster, they warn.

In their effort to announce a major achievement in shape of Iran-Pakistan pipeline, petroleum authorities have sidestepped another important gas import project, which is expected to be awarded by the end of the year.

Almost all technical work on the Mashal LNG (liquefied natural gas) project has been completed and only confirmation of gas supplies is awaited from the company which is investing, people close to the two projects say.

LNG, which is first liquefied, transported on special vessels and gasified again at the port before being supplied, is the quickest way for importing gas.

Pakistan is fast running short of gas, the most used fuel in the country which helps run its industries and geysers and stoves in homes. It is also increasingly being used in cars now.

Already gas shortage has marred the economy. In winters, industries are forced to close their manufacturing plants to ensure gas availability to domestic consumers for water heating.

Now it is happening even in summers. Just days back, gas supply stopped to industries in the NWFP. The supply-demand balance was disturbed only because a gas field was closed for annual maintenance.

Pakistan consumes almost 4,000 million cubic feet of gas every day. All of the demand is met from domestic gas fields, like Sui in Balochistan, which are depleting rapidly as petroleum exploration companies struggle to find fresh reserves.

Munawar Baseer, former managing director of Sui Southern Gas Company (SSGC), says the gap between the supply and demand of gas in winters exceeds 800mmcfd. “Work on Mashal LNG was envisaged to start in 2007 for these difficult times. Bureaucratic bottlenecks did not let that happen.”

Even the gas shortfall figures, which are based on estimates done 4-5 years back, do not paint the real picture. Amid the worst power crisis, thermal power plants are increasingly being run on expensive fuel oil because of limited availability of gas.

Being managed by the SSGC, the Mashal project is not receiving the government’s attention it deserves, officials involved in the project say. There is hardly any mention of the project in official statements.

They also fear that the company 4gas, which will develop an LNG terminal, auxiliary facilities and import gas, might back off if it did not see firm commitment of the government for a long-term relationship.

Despite a message left for GA Sabri, Additional Secretary Petroleum, he did not respond. SSGC MD Umair Khan was reluctant to speak to media.

 

[Neo]

France to finalise partnership accord ​

Friday, July 10, 2009

LAHORE: French Economic and Commercial Counsellor Dominique Simon has said that the French President, Nicolas Sarkozy is planning to visit Pakistan by the end of the year to finalise an agreement on global partnership.

He was speaking at the Lahore Chamber of Commerce and Industry (LCCI) on Thursday. LCCI President Mian Muzaffar Ali and Senior Vice President Tahir Javaid Malik also spoke on the occasion. Simon said that the agreement between Pakistan and France would help Pakistani businesses go global and technologically advanced.

Dominique Simon said that the French Minister of Foreign Trade Anne-Marie Idrac along with a team of MPs and businessmen is also visiting Pakistan, Lahore to have a direct interaction with the business community. He said that France was ready to cooperate with Pakistan in civil nuclear technology to overcome the ongoing energy crisis and for that purpose French companies were ready to make investment.

Simon said that France had recently signed an agreement with the Agriculture University Faisalabad that would help Pakistan’s agriculture sector. Speaking on the occasion Muzaffar Ali stressed the need for catalogue exhibitions, exchange of delegations, holding single country exhibitions and country weeks on reciprocal basis to increase the volume of two-way trade.

He said Pakistan’s agriculture produce is among the best in the world but it has failed to exploit the traditional strength in agriculture, horticulture, livestock and food processing because of the lack of technology.

In this regard, French equipment and technology can help exploit Pakistan’s full potential.

He said mutual cooperation between the two countries is visible in the areas of trade, industry and investment.

The French multinationals have been able to find a favourable environment for long-term investment in Pakistan. Famous brands like Total, Alcatel and LU have also found growth and acceptance on the basis of strength of their products. Apart from these, there are several French firms engaged in the field of electrical equipment, oil and gas, rural telephony, civil engineering and defence.

 

[Neo]

China MCC may invest $2.2bn in PSM ​

Friday, July 10, 2009

ISLAMABAD: China Metallurgical Group Corporation (MCC) has shown interest in investing $2.2 billion for the expansion and revamping of Pakistan Steel Mills (PSM).

A twelve member delegation of MCC headed by Huan, met here on Thursday with the Federal Minister for Industries and Production Mian Manzoor Ahmad Wattoo, and discussed various proposals in detail.

According to MCC, they will set up a new plant within 2 years as the first phase of the expansion project. The construction of the new plant will cost around $1.2 billion and upon completion, it will be capable of producing 2 million tons of steel per annum.

In the second phase the MCC will revamp and modernise the existing PSM plant. The second phase according to MCC will take another 2 years to complete and would cost around $1 billion.

They said that the revamping will raise PSM’s production capacity to 3 million tons per year, which today stands at 1.1 million tons per year.

The minister took keen interest in MCC’s proposals and appreciated Huan and her team for taking interest in the PSM project. He assured Huan that he and his team would deeply study their proposals and would take a final decision on the project very soon.

The MCC which already conducted a technical investigation of the PSM in 1992 and produced a 500 page report on the expansion of PSM in 2005 is China’s leading multidisciplinary multinational company.

The MCC is known for its experience in scientific research, industrial engineering practice and international trading capabilities.

According to the MCC website, the group is a major driving force behind the growth of China’s steel industry, and a reputable contractor of a number of key projects both at home and abroad.

 

[Neo]

CPI closes financial year 2008-09 at 20.77 percent​

KARACHI: The Consumer Price Index (CPI) based Inflation-set to rise due to latest presidential move by restoring the petroleum development levy-settled in double digits during the financial year 2008-09.

CPI, the most widely used indicator to measure the fluctuation in the prices, closed at 20.77 percent for the last fiscal, Federal Bureau of Statistics (FBR) reported on Thursday.

In month of June 2008-09, it rose 13.13 percent over the corresponding period of previous year whereas it was almost one percent higher against the preceding month of May of the year under review.

Although high base impact supported annual CPI significantly, increasing MoM inflation remained the concern as it has continued upward trend since Feb-09.

However, monthly inflation for May 2008-09 declined by 20bps MoM, indicating better crop yield to pay dividends in terms of lower food inflation going forward.

Major relief was witnessed in the core inflation Non Food and Non Energy), which grew 15.9 percent YoY down from 16.6 percent recorded in the month of May.

"Easing of core inflationary pressures is a healthy sign as it will give some room to the central bank for a discount rate cut in the Monetary Policy Statement (MPS) expected at the end of current month", analyst Abbas Zulfiqar Ali at Ismail Iqbal Securities noted.

Easing of inflationary pressures is also reflecting in lower yields of 10 year PIB which is showing a declining trend.

Food inflation, having 40.34 percent weightage in the CPI basket declined significantly compared with the previous trends and recorded 10.50 percent growth over the month June in the last financial year.

Fuel & lighting index saw 23.78 percent growth during the month under review and house rent was up 18.60 percent.

Transport and communication rose 5.01 percent in the said month and education expenses grew 19.18 percent. Medical expenses went up 6.26 percent.

Analysts believed that Supreme Court's decision to revise domestic oil prices downward could have helped arrest inflation, had the government not stepped in to impose PDL.

Though the move would help the government meet IMF targets, However, MoM inflation is expected to increase by 1.8pps in Jul-09 due to this step, though YoY inflation is not expected to be impacted due to a high base effect.

Moreover, risk of int'l oil prices is expected to remain significant as the oil price increase and implication of carbon tax was reflected in SPI for first week of Jun-09 which increased by 107bps MoM to 1.23 percent.

However, the upward shift in oil prices is now showing a reversal sign (crude oil declined by 11 percent MoM in Jul-09TD).

Sensitive Price Index (SPI) and Wholesale Price Index (WPI) closed financial year 2008-09 at 23.41 and 18.91 percent, respectively.

 

[Neo]

US House okays $1.5bn assistance for Pakistan in FY 2010 ​

WASHINGTON (July 10, 2009): The US House of Representative approved on Thursday a $ 48.8 billion State and Foreign Operations bill that authorizes $ 1.519 billion in assistance for Pakistan in the fiscal year 2010, beginning October 1.

On the same day, Senate Appropriations Committee also passed its own version of the State and Foreign Operations Appropriations measure that provides $ 1.57 billion in aid for Pakistan in 2010 financial year.

The differences in versions of the two chambers are to be worked out before Congress sends a final bill to President Barack Obama for his signature.

According to the House bill, Afghanistan will get $ 2.695 billion in assistance the year 2010.

Besides, the House State and Foreign Operations Appropriations also includes a disaster assistance of $830 million, which will be used to help avert famines and provide life saving assistance during natural disasters and for internally displaced people in Afghanistan, Pakistan, Iraq and elsewhere around the world.

Pakistan and international forces in Afghanistan are fighting Taliban militants in the border region. In the wake of 2001 terrorist attacks, the United States and Nato have deployed thousands of troops in Afghanistan, which has seen a stiff Taliban insurgency in the last two years.

Pakistan has been a frontline state in the fight against al Qaeda and the Taliban and is currently engaged in a strong offensive against militants in on its side of the border. In the last two years, Pakistan has been the biggest victim of terrorism according to the State Department annual report.

 

[Neo]

Nepal wants to establish economic, trade ties with Pakistan ​

FAISALABAD (July 10 2009): Nepal wants to establish reasonable business and economic ties with Pakistan, expressed Ambassador of Nepal, Bala Bahadur Kunwar, on the eve of a meeting held within the Faisalabad Chamber of Commerce and Industry. Both nations should take steps for mutual confidence-building, he added.

While bringing the business community of Faisalabad into confidence, he said, that there was no risk involved in investing in Nepal. It was also a pleasant fact that Nepal and Pakistan were close to each other politically, culturally and linguistically.

While referring to the good political relations between Nepal and Pakistan, the Deputy Chief of the Mission, K.N. Adhi Kari, said that there was a dire need to develop trade and economic relations between the two countries.

Talking about the SAARC countries, he told the audience that, in the last year, the trade volume between Nepal and Pakistan remained at 1.94%, which was too low as compared with other countries of the SAARC.

While addressing the audience Mian Hamid Javed, President, FCCI, said that despite an extensive 1982 trade agreement, the volume of bilateral trade remained comparatively small at USD 4.8 million. Pakistan's total exports to Nepal were worth USD 1.631 million, while Nepal's exports to Pakistan were USD 3.166 million. Both countries had recently, stepped up efforts to promote bilateral trade, especially in textiles, oilseeds, extraction of oil and tourism.

He further added that Pak-Nepal bilateral relations were based on the principles of sovereign equality and non-interference in each other's internal affairs. These relations would always flourish in times to come. At the end of meeting, the FCCI Shields were presented to Bala Bahadur Kunwar, the Ambassador of Nepal and K.N. Adhi Kari, the Deputy Chief of the Mission.

 

[Neo]

Sarkozy to visit Pakistan for finalising global partnership accord ​

LAHORE (July 10 2009): The French President Nicolas Sarkozy will visit Pakistan by the end of this year to finalise an agreement of global partnership under which access of Pakistani businesses to the global market would be further strengthened besides advancement in the technology. The French Economic and Commercial Counsellor Dominique Simon revealed this while speaking at the Lahore Chamber of Commerce and Industry on Thursday.

He said that France had a history of relations with Pakistan and desires to further strengthen it. He said that French Minister of Foreign Trade Anne-Marie IDRAC along with a team of member parliaments and businessmen also visiting Lahore to have a direct interaction with the business community.

France was ready to cooperate with Pakistan in civil nuclear technology to overcome the ongoing energy crisis and for that purpose French companies were ready to make investment, he said. Dominique Simon further said that ALCATEL and TOTAL were planning to increase their investments in coming days.

It makes the point that France desires early economic revival of Pakistan, he said, adding that France had recently signed an agreement with Agriculture University Faisalabad that would help Pakistan's agriculture sector in a big way, Dominique Simon said.

Speaking on the occasion, the LCCI President Mian Muzaffar Ali stressed the need for catalogue exhibitions, exchanges of delegations, holding single country exhibitions, and country weeks on reciprocal basis to increase the volume of two-way trade.

There was a vast scope of joint ventures in the field of food processing, mining, oil and gas, he said adding that joint venture opportunities also exist in the field of high technology that includes telecommunication, chemicals, automobiles and shipbuilding.

He said the French companies could also participate in infrastructure development projects like railways, seaport development, telecommunications and electronics. He said Pakistan's agriculture produce was among the best in the world but it had failed to exploit the traditional strength in agriculture, horticulture, livestock and food processing due to lack of technology.

Although Pakistan was the 5th largest producer of milk in the world, the current industry was inadequate to meet the growing demand for milk and other dairy related products. In this regard, French equipment and technology can help exploit Pakistan's full potential in agriculture, horticulture, dairy, livestock and food processing sectors he added.

France and Pakistan had been steady trading partners. Analysis for the year 2007-08 shows that the trade between the two countries stood around 826 Million US Dollar. Pakistan's imports from France remained 464 million US Dollar, while Pakistan's exports to France figured around 362 million US Dollar during the year 2007. These figures clearly indicate that both the countries were not benefiting considerably in each other's respective markets, he said.

He said that traditionally, Pakistan and France had shared cordial diplomatic and economic ties. Both the countries had shared common perception on major issues related to international and regional peace and security. The French multinationals had been able to find the favourable environment for long-term investment in Pakistan.

Brand names like Total, Alcatel and LU have found acceptance in the Pakistani market on the basis of the strength of their products. Apart from these, there were several French firms engaged in the field of electrical equipment, oil and gas, rural telephony, civil engineering and defence, he added.

 

[Neo]

Remittances hit $7.8bn record high in 2008-09 ​

Saturday, July 11, 2009

KARACHI: Pakistanis living abroad sent home a record $7.811 billion during financial year 2008-09, beating the previous high of $6.451bn transferred a year before, the State Bank of Pakistan (SBP) said on Friday.

This 21 per cent year-on-year increase in remittances translates into monthly average of $650.95 million during July-June 2008-09. The monthly average was $537.6m in 2007-08.

The month of June 2009 saw a substantial increase of 34 per cent in remittances as Pakistanis remitted $735.17m compared with $547.41m sent home in June 2008, the SBP said.

Most of the increase in remittances has come from the UAE, Saudi Arabia and GCC countries, which include Bahrain, Kuwait, Qatar and Oman, where a large number of Pakistani unskilled workers are employed.

Though highest remittances of $1.735bn came from the US, they were down from the previous year’s $1.762bn. Inflow from the UAE, Saudi Arabia and GCC countries jumped to $1.688m, $1.559m and $1.202m respectively from previous $1,090.30m, $1,251.32m and $983.39m.

The fact that remittances jump due to the inflows from the Middle Eastern region has worried analysts who cite growing number of people losing jobs there. They fear that this increase might be a reflection of jobless Pakistanis transferring their properties before heading back.

Remittances received from the UK and the EU also increased to $605.69m and $247.66m from last year’s $458.87m and $176.64mn, respectively. Pakistanis in Norway, Switzerland, Australia, Canada, Japan and other countries sent $771.03m in fiscal 2009 against $726.29m in fiscal 2008.

 

[Neo]

PIA waiting for govt nod for 27 new planes: MD ​

Saturday, July 11, 2009

MULTAN: Pakistan International Airlines (PIA) Managing Director Captain Muhammad Ijaz Haroon said on Friday that the national flag carrier was waiting for the government’s approval to induct 27 new planes into its fleet in five years.

Talking to media persons here, he said the government was extending full support to the PIA and there was no political influence in recruitments and postings.

To a question, he said as per PIA law, new pilots had to perform their duty on contract basis for three years and the decision to regularise their services is taken on the basis of their performance.

To another question, he said he was also a pilot but no one including pilots should be given preferential treatment. He said that if pilots committed a mistake, they would have to face accountability.

Haroon said efforts were being made to get planes on lease but added that there existed some problems in its way. He said the market share of PIA had increased by two per cent in comparison to last year, but the PIA was still facing Rs30 billion deficit per year including Rs26 billion caused by increase in foreign exchange rates.

Our correspondent adds from Karachi: The International Society of Air Safety Investigators (ISASI) and the Royal Aeronautical Society (Pakistan Division) co-hosted a seminar on aviation safety on Friday at a hotel in Multan.

Sponsored by the PIA, it coincided with the third anniversary of PIA Fokker crash on July 10, 2006, as a mark of commemoration, said a PIA handout issued here.

PIA Managing Director Capt Aijaz Haroon said the Multan Fokker crash was a tragic and unfortunate incident, which would be remembered by the entire airline. He said that PIA’s foremost priority is the safety of its passengers and special attention is being paid to safety standards at the airline.

The PIA has successfully renewed its IATA Operational Safety Audit (IOSA) registration. He said the PIA would organise a safety seminar each year in Multan. A memorial would also be placed at the Multan airport that would be shortly built with the cooperation of the CAA.

Papers were presented by the officials of PIA, CAA, Pakistan Army, Pakistan Air force, Airblue, Pakistan State Oil, Shaheen Air International, Singapore Accident Investigation Board and International Society of Air Safety Investigators (ISASI).

 

[Neo]

KSE gains 72 points on investment-friendly news ​

Saturday, July 11, 2009

KARACHI: Investment friendly news invited fresh funds on Karachi bourse on Friday.

The benchmark KSE 100-sjhare Index breached through the 7,500 points resistance level on gain of 72.65 points or 0.98 per cent and closed at 7,502.66 points. The 30-Index surged by 75.50 points or 0.95 per cent and concluded at 8.032.06 points.

Analysts said the news about introduction of two modified leverage products - one for futures contract and other for ready boards - helped trigger across the board buying on the bourse. The strong expectations of interest rate cut in days ahead; clearance of the issue on oil pricing and restoration of country foreign exchange reserves to 14-month high of over $12 billion altogether invited buyers to accumulate shares across the board.

The turnover shrank by 13.4 per cent to 124.8 million shares as compared to 144.1 million shares yesterday. Future market, as usual, remained stagnant with zero shares turnover in this session too.

Front line stocks attracted fresh funds but not aggressive buying like yesterday. Investors were more interested in tier two stocks.

Rise in share prices, on the other hand, inflated the overall market capitalisation by Rs14 billion to stand at Rs2,209 billion. This is included an inflow of Rs38.2 million (or $471 thousand) from overseas investors, according to NCCPL.

OGDC alone included 22.50 points in the benchmark 100-Index, while Pak Petroleum added another 7.84 points. The other notable gainers contributed points in the said index below four points each.

Expansion plan announced by Azgard Nine by getting their sponsor holding of fertilizer sector enlisted, highlighted the stock both on gains and turnover, while another stock Pace Pakistan managed to stay the volume leader for second consecutive session. Both the stocks contributed 25 per cent to the total turnover. Day end activity by the regular players taking full advantage of cost lowering on the positive whispers regarding an early introduction of leverage allowed market to move upside, said Hasnain A. Ali at Aziz Fidahusein.

After discounting negative repercussions of carbon tax suspension on economy and different sectors, positive sentiment at KSE finally restored and index successfully stayed above psychological level of 7,500 points.

This bullish rally can be attributed to the news of reinitiating of deliverable future, which was so intensely desired by participant along with ready market leverage source ‘margin financing’, said Kashif Mustafa at Crosby Securities.

Reduction in Karachi Inter Bank Offered Rates (KIBOR) and inflation along with appreciation in foreign reserve and expected cut of around 200 basis points in policy rate, are also reasons of making short to medium term scenario promising for the market participants, he added.

Out of total 292 actives, 164 stocks advanced, 107 stocks declined, the value of remaining 21 stocks closed unchanged.

Highest volumes were witnessed in Pace (Pak) at 16.7 million closing at Rs6.60 with a gain of nine paisa, followed by DG Khan Cement at 10.9 million closing at Rs30.82 with a gain of 82 paisa, JS Company at 9.8 million closing at Rs26.11 with a gain of 73 paisa, Azgard Nine at 9.5 million closing at Rs26.64 with a gain of Rs1.26, and Engro Polymer at 6.9 million closing at Rs21.64 with a gain of Rs1.03.

 

[Neo]

Pak-Lanka trade rises by 80pc ​

Saturday, July 11, 2009

KARACHI: Trade volume between Sri Lanka and Pakistan has increased by 80 per cent since 2002 after both the countries sealed the Free Trade Agreement (FTA), said VS Sidath Kumar, Consul General of Sri Lanka.

Sri Lankan exports to Pakistan have risen to $78 million from $39 million and exports of Pakistan to Sri Lanka have jumped to $192 million from $107 million, he said.

He was speaking to the businessmen in a meeting at the Karachi Chamber of Commerce and Industry (KCCI) on Friday. At present, the trade between the countries covered about 4,600 products and there is a dire need to increase the number of products, he stressed.

He said Sri Lanka may act as a gateway for Pakistani exporters who face problems in exports to India and suggested to them to take the benefit of FTA and export to India via Sri Lanka. The business people said both the sides enjoy cordial relations in all sectors and this could also help boost their cooperation in trade and tourism.

KCCI President Anjum Nisar stressed the need of identifying potential sectors and products so the two countries could deploy the FTA.

He appreciated efforts of the consul general in inviting Sri lankan businessmen to “My Karachi 2009 Exhibition” and his overall services in building relations between the countries.

“Even in the presence of the FTA the bilateral trade between Sri lanka and Pakistan has not risen, and this is high time to gear up the efforts in order to bolster up it,” Nisar said. The countries can boost their trade by supporting each other as Pakistan is the gateway to Central Asian states while Sri lanka enjoyed duty-free access to European and Indian markets.

 

[Neo]

Orders worth millions expected at Canadian expo ​

Saturday, July 11, 2009

KARACHI: The launch of a bilateral trade event in Toronto, the Canada-Pakistan Trade Expo, is believed to begin a new era of trade and cooperation between the two countries.

The exhibition, which is the first of its kind, started on July 8 and would end on July 12. Trade Development Authority of Pakistan Chief Executive Mohibullah Shah and Federation of Pakistan Chambers of Commerce and Industry President Sultan Ahmad Chawla jointly inaugurated the exhibition at the Congress Centre of Toronto the other day, according to a statement issued by the FPCCI on Friday.

“This is the first-ever bilateral trade event in the continent, which is devoted to Pakistani exporters and manufacturers to help them make inroads into the Canadian market and explore its potential to the maximum extent,” the statement said.

Addressing the inaugural ceremony, Gerry Philip, Chair of Cabinet in the Canadian Ministry, stressed the need of organising such events and exchange of trade delegations between the two countries.

“Pakistani community is playing an important role in promotion of economic and friendly relations between the two countries,” he added.

“About 124,730 Pakistanis are living in Canada, who would like to see their home products in Canada,” an exporter commented.

The exhibition, which is being held with the support of the Pakistan Consulate General, has more than 70 stalls of different Pakistan-made products. The attractive displays are inviting Canadian buyers and visitors, who are expected to place millions of dollars worth of import orders.

 

[Neo]

Share of commodity producing sectors in GDP declining​

ISLAMABAD: The Federal Bureau of Statistics has released the contribution of different sectors in the Gross Domestic Product (GDP) of the country which show that the share of commodity producing sectors-agriculture, industrial electricity, gas-in the GDP has declined from 47 percent in 2007-08 to 46.2 percent in last fiscal year 2008-09.

The share of industrial sector in the GDP has declined from 25.7 percent in 2007-08 to 24.3 percent and due to the better performance of the agriculture sector; the share of agriculture in GDP has increased from 21.3 percent to 21.8 percent, according to the latest position of different sectors in GDP developed by Federal Bureau of Statistics.

Growth in commodity producing sectors is vital as growth in this sector creates new job opportunities in the country. Decline in the share of commodity producing sectors in GDP results in joblessness and unemployment in the country. The decline in this sector has made hundreds of thousands of laborers jobless. The prime focus of the government is to enable the commodity producing sector increase its growth rate in 2009-10 and create new job opportunities in the country, explained an official at Planning Commission.

The export-oriented industrial sector was witnessed harsh times both due to domestic structural constraints like power and gas shortage. The international scenario does not bodes well for this vital sector as the financial crisis has jolted the economies of EU and US, which are the major demand drivers of Pakistan's export-oriented industries.

Industrial Sector: This sector's contribution in GDP was 23.3 percent in 1999-2000, which increased to 26.3 percent in 2004-05. However, due to the persistent power shortages and other factors its share declined to 25.7 percent in 2007-08 and further decreased to 24.3 percent in 2008-09.

Within the industrial sector the share of mining and quarrying in GDP that was 2.6 percent in 2007-08 declined to 2.5 percent in 2008-09. Similarly, share of manufacturing declined by 1 percentage point from 19.2 percent to 18.2 percent of the GDP due to the power, gas shortages and other factors in 2008-09.

Large Scale Manufacturing (LSM) contributions in GDP were recorded at 13.4 percent in 2007-08, which declined to 12.1 percent of the GDP in 2008-09. Small-scale manufacturing and household share has increased from 4.4 percent of the GDP to 4.7 percent of the GDP in 2008-09. Slaughtering was contributing 1.3 percent in GDP in 2007-08 has now increased its share to 1.4 percent of the GDP in 2008-09. Construction sector's share, which is known as major facilitator of 26 allied industries, in GDP has decreased from 2.4 percent of the GDP to 2.1 percent of the GDP in 2008-09. The share of electricity, gas and water supply in the GDP have declined from 1.6 percent of the GDP in 2007-08 to 1.5 percent of the GDP in last fiscal year 2008-09.

Agriculture Sector: The contributions of agriculture sector in GDP were 25.9 percent in fiscal year 1999-2000 that declined to 21.3 percent in the previous fiscal year 2007-08, however, due to the better performance of sector as a whole, its share has risen again to 21.8 percent.

Within the agriculture sector crops share have increased from 9.5 percent to 9.9 percent due to the batter performance of wheat crop. Share of major crops have increased from 6.9 percent to 7.3 percent and share of minor crops have remained stagnant at 2.6 percent in last fiscal as compared with previous fiscal year. Overall share of livestock have witnessed an increase and moved from 11.1 percent of the GDP to 11.3 percent of the GDP in 2008-09. Shares of fisheries and forestry in GDP have been estimated at same level at 0.4 percent and 0.2 percent of the GDP by the end of 2008-09.

Services Sectors: The share of services sector, which was 50.7 percent of the GDP in 1999-2000, has increased to 53 percent in 2007-08 and further increased to 53.8 percent in 2008-09 owing to dull performance of industrial sector. The contributions of transports and communication in GDP were 10.2 percent in 2007-08 have increased to 10.3 percent, share of wholesales and retail trade has also increased from 17.23 percent to 17.5 percent, share of finance and insurance declined from 6.4 percent to 6.2 percent, ownership of dwelling's share in GDP remained at 2.7 percent, public administration and defence increased its share in GDP from 5.9 percent to 6.1 percent of the GDP and social, community and public services share in GDP has also increased from 10.6 percent to 11.1 percent by the end of 2008-09.

 

[Neo]

First-ever industrial policy in a couple of months: Wattoo ​

ISLAMABAD: The government is working on a first-ever comprehensive industrial policy for the promotion of industrial sector.

Federal Minister for Industries and Production Mian Manzoor Ahmed Wattoo on Friday said this while addressing the business community at the Islamabad Chamber of Commerce and Industry (ICCI).

The minister said the policy would be formulated in consultation with all stakeholders accommodating their views and suggestions.

He said the policy to be announced in a couple of months was initiated after a long time, to help promote industrial sector of the country. The minister also announced to set up a Marble City in Islamabad in collaboration with PASDEC promote local marble industry. He said the government was according priority to the SMEs sector as it was an engine of growth and a key source for job creation. Wattoo said the Small and Medium Enterprise Development Authority would be made more efficient to accelerate the pace of development of the SMEs.