Pakistan's Economy - News and Updates

[Omar1984]

KSE up by 1.7pc as foreign buying gains momentum


LAHORE - Political uncertainty in the country kept the investors’ sentiments weak, as they took a cautious stance throughout the outgoing week, however, foreign buying gained momentum as foreigners stood as the net buyers of shares worth $9.6 million.

The KSE 100 Index was up by 1.7 per cent on weekly basis and closed at at 10,432 level while turnover stood at 90 million shares, down by 2 per cent.
Cement sector remained in the limelight as UN approved $1.88 billion rehabilitation and reconstruction for Pakistan.

Experts said that weak economic data such as higher than consensus inflation of 15.7% and 28.5% plunge in net foreign investment inflow in 1QFY11 too kept investors sidelined. Even positives such as upward revision in gas wellhead prices and robust remittances data for July-Sept failed to trigger investor interest.

Sana Hanif, a stock market expert, said foreigners stood as net buyers of shares worth US$9.6mn, where as banks were the net sellers of US$6.9mn.
Ahsan Mehanti, Director, Arif Habib Investments Limited observed that positive activity witnessed on institutional and foreign interest in Pakistan banks, fertilizer and banking scrips ahead of major earning announcements next week.
Expectation rise over pledges in international donors meeting in Brussels for fighting terrorism and rebuilding after Pakistan floods and higher international oil prices near to $83 played a catalyst role in positive activity at KSE despite concerns for rising political-judiciary conflict in NRO case hearings and rising circular debt in Pakistan energy sector.

The finance minister, Hafeez Sheikh met with the IMF and WB officials and although no major development came to the forefront, the IMF has hinted that it may relax the fiscal deficit target by 0.7% and may disburse US$1.8bn by Dec upon successful completion of the reforms. In the outgoing week, the economic data released was a mixed bag: CPI for Sep2010 was higher than industry consensus at 15.7%, foreign exchange reserves were flat at US$16.97bn, whereas remittances were up 13.5% at US$2.65bn.

During the week, OGRA raised the wellhead gas prices for 21 fields. The revision was broadly in line with expectations and the E&P stocks witnessed a rally throughout the week. Additionally, the textile ministry requested the EU to include additional 15 home textiles and garment items to its tariff waiver list for exports. However, this too failed to generate activity in NML, though NCL gained 3.7%.Lastly, a 30% cut in PSDP proved to be a sentiment dampener for the cement sector. With the onset of the result season, the market could witness some pre-result rally, going forward.


Hasnain Asghar Ali from Aziz Fidahusein & Co said that increasing debt burden should be avoided, however efficient debt management may prove profitable. Presence of financial groups from the local as well as through offshore accounts along with activity by foreign fund managers will ensure availability of trading opportunities. While official statement carrying the timeline for introduction of MTS along with salient features may allow concrete stance.

Experts said that US dollar is witnessing a broad based decline against the international currencies these days, as it is currently trading at 1.4 US$/Euros, 81.10 JPY/US$ and 1.6 US$/GBP compared to Thursday’s closing of 1.4 US$/Euros, 81.77 JPY/US$ and 1.58 US$/GBP, respectively.

The decline in value of the US dollar has a significant impact on the corporate sector of Pakistan.

The textile sector stands to gain foremost as 27 per cent of their exports is directed towards the European markets. However, on the flip side local auto assemblers’ stand to lose as 50-60 per cent of the sector’s parts are imported from Japan.

Experts currently have a ‘Market-Weight’ outlook on both the textile and the auto sector.

Amongst them, NML remain top pick with a target price of Rs63, followed by an accumulate stance on INDU and ‘Hold’ on NCL and PSMC.

They said that both PTA and PX prices are currently trading at 2 year high levels. The later is due to surging oil prices standing at $1265-1275 per ton and on the other hand PTA is currently hovering at $1045 per ton.

While increase in PTA prices is due to higher cotton prices which prompted consumers to buy more PSF (Polyester Staple Fiber) which is manufactured from PTA.

Thus, with higher demand, PTA prices are expected to remain on higher side which bodes well for international and local PTA manufacturers.
–Salman Abduhoo


KSE up by 1.7pc as foreign buying gains momentum | Pakistan | News | Newspaper | Daily | English | Online

 

[bc040400065]

Floods inflict loss of Rs281b to agri sector
Muhammad Arshad


Islamabad —The National Assembly Standing Committee on Food and Agriculture on Friday was told that the agriculture sector was the worst affected in recent floods as cultivated crops on 2.3 million hectares had been wiped away tantamount to total damage Rs. 281 billions. As per the rapid flood damages assessment indicates agriculture sector was the most affected in flood hit areas and International /National Organizations had also confirmed the statistics.

The NA body met here at the Parliament House with Javed Iqbal Warraich, in the chair to discuss estimates of crops, cattle and poultry farming losses by flood in the country along with steps taken by the Government of Pakistan, Zarai Taraqiati Bank and Insurance companies to compensate affected farmers.

Muhammad Baligh-ur-Rehman, Jam Mir Muhammad Yousaf, Dr. Abdul Kadir Khanzada, Syed Haider Ali Shah and Rana Tanveer Hussain were present in the meeting that noted that there would be an extensive loss in productivity of all kinds of Kharif crops, including rice, sugarcane, cotton, maize and pulses.

The cotton was the most affected crop, as it had to bear a loss of Rs 79.270 billion. Rs. 26.045 billion loss occurred to sugarcane crop. The loss to Peddy is Rs 61.073 million. The other crops suffered Rs.115.245 million. A large number of cows, buffaloes, goats, sheep, horses, camels and donkeys have been lost and fish farms and poultry farms destroyed containing Rs. 21.836 million out of total population of 153 million of animals across the country in 48 districts, said the Committee.

The Committee appreciated Government of Pakistan to provide free seed and fertilizer to the farmers of the affected areas having holding up to 25 acres as under at the rate of 50 Kg. Seed per acre at Rs 1500, DAP fertilizer (one bag/acre) at Rs2800 and Urea fertilizer (2 bag/ acre) at Rs 1800. The Committee expressed sorrow that Crop Loan Insurance Scheme (SLIC) has been launched for five major crops viz. wheat, cotton, rice, sugarcane and maize but practically so far no relief is granted to the farmers. The Committee informed that Agricultural Loans for the flood affected areas are around Rs. 90 billion, out of which, Rs.44 billion has been estimated as the loan losses while only Rs. 4.5 billion are insured under CLIS.

The Committee appreciated that recently Government of Pakistan has launched a concessional financing and guarantee scheme for canola cultivation in the flood affected areas. The farmers are provided with the loans for cultivation at concessional mark up of 8% which is much lower than the market rate. This scheme is effective from 05th October, 2010, till 31st October, 2010.
Floods inflict loss of Rs281b to agri sector

 

[bc040400065]

SBP's annual report shows 4.1% growth rate

State Bank of Pakistan’s (SBP) Annual report for fiscal year 2010, which was released on Monday, shows Pakistan’s macro- economy grew at a rate of 4.1 per cent compared to the 1.2 per cent growth in the preceding year. Projections for the current fiscal year ending June 30, 2011 include a GDP growth between two and three per cent, while annual average inflation has been predicted between 13.5 to 14.5 per cent. Fiscal and current account deficits are likely to be between five to six per cent and three to four per cent of the GDP, respectively. Workers’ remittances are expected to stay between $9.5 billion and $10.5 billion for fiscal year 2011. Exports and imports value is expected to be $21 billion and $35 billion respectively. Key reforms that failed to gather traction according to the report are:

Persistent disagreements among tax payers and the provincial governments on expansion of the tax net
Failure to carry out proposed restructuring of public sector enterprises
The Energy Sector Debt crisis
The report pointed out that the principal structural problem, however, was the weak fiscal performance; the fiscal deficit bounced back to 6.3 percent of GDP in FY10, i.e., 1.1 percentage points higher than in the previous year. FY10 fiscal performance was characterized by continuing expansion in fiscal and quasi-fiscal operations, that crowded out and otherwise undermined private sector activities, supported the persistence of double-digit inflation, and increased the total public debt and liabilities substantially, from 68.7 percent of GDP in FY09 to 69.5 percent in FY10,” the Report said. Referring to recent unprecedented floods in the country, the Report pointed out that various FY11 macroeconomic targets have suffered a serious setback early into the year as large areas of the country were devastated by widespread rains and unprecedented floods. Large parts of the country’s agricultural heartland were particularly hit hard by these floods, with significant damages to standing kharif crops (cotton, rice and sugarcane) and livestock. The economy also suffered extensive damage to infrastructure (bridges, road networks, gas/power plants, and some industrial units such as rice mills, ginning factories etcetera), productivity losses from supply-disruptions and the large-scale displacement of people, etcetera, it added It said that even a cursory assessment of the broad contours of the losses indicates that their repercussions will continue to stress the economy for many years. It is therefore obvious that the economic priorities and targets for FY11, in particular, will see substantial revision, and all key macroeconomic indicators will likely record deterioration, the report observed. The SBP report said that the impact of the floods has strengthened the inflationary expectations for FY11 – the August 2010 CPI, included a 15.6 per cent year-on-year rise in its food component. However, SBP assessments suggest that the direct impact of the flood-related supply shock is likely to be limited. For example, the impact of flood/rain damages and shortages of minor crops are not expected to persist beyond two to three months as supply line improves and as fresh crops enter the market. Similarly, for some other products, any rise in domestic prices would be capped by low international prices. It is important to note that prices of dairy products were already continuing on a secular rise, even prior to the floods, due to sustained strong domestic and external demand. Livestock losses in the flood would exacerbate this rising trend, but only to a small extent, the report added. The report also acknowledged that the worsening in most of the Pakistan’s macroeconomic variables has further complicated the monetary debate in FY11. “On the one hand, there is the argument that the central bank should respond to the rising inflationary pressures and excessive increase in the fiscal deficit, and on the other, the demand-shock stemming from the flood damages argues for a countervailing monetary easing to help revive the faltering economy,” it added. “In short, the negative shocks stemming from the floods have further exposed the existing structural weaknesses in the economy. Addressing these will require improvements in macroeconomic discipline as well as continued reforms to improve the resilience of the economy,” the report added.

SBP’s annual report shows 4.1% growth rate – The Express Tribune

 

[RabzonKhan]

State Bank predicts 2-3pc growth rate

By Shahid Iqbal
26 Oct, 2010

KARACHI: The State Bank has predicted 2-3 per cent GDP growth in the current financial year despite severe flood losses. The target set in the budget was 4.5 per cent.

The bank’s annual report for 2009-10 issued on Monday said there was a noticeable improvement in macroeconomic indicators during FY10 with the economy growing at 4.1 per cent, compared to 1.2 per cent in the preceding year.

It projected an average annual inflation in FY11 at 13.5-14.5 per cent and fiscal and current account deficits at 5-6 per cent and 3-4 per cent of the GDP.

The report said the impact of floods had strengthened inflationary expectations and the August CPI showed a 15.6 per cent year-on-year rise in its food component.

However, the direct impact of the flood-related supply shock is likely to be limited and shortage of minor crops may not persist beyond three months as supply line improves and fresh crops reach the market.

The SBP said the fundamental structural weaknesses in the economy remained unaddressed and some key reforms failed to gather traction.

Persistent disagreements led to the deferment of a proposed expansion of the tax net through the introduction of a broad-based GST, the proposed restructuring of public sector enterprises to improve efficiency and lower the fiscal burden did not take place and after some initial work, there was little or no progress in either resolving the energy sector debt chain or substantially improving electricity supply.

The report said various macroeconomic targets had suffered a setback early into the year because of the floods. Large parts of the country’s agricultural heartland were particularly hit hard, with significant damage to standing kharif crops (e.g., cotton, rice and sugarcane) and livestock.

The economy also suffered extensive damage to infrastructure (bridges, road networks, gas/ power plants and some industrial units such as rice mills, ginning factories, etc.), productivity losses from supply-disruptions and large-scale displacement of people, it said.

The SBP said that even a cursory assessment of the broad contours of the losses indicated that their “repercussions will continue to stress the economy for many years”.

“It is therefore obvious that the economic priorities and targets for FY11, in particular, will see substantial revision and all key macroeconomic indicators will likely record deterioration.

“The negative shocks stemming from the floods have further exposed the existing structural weaknesses in the economy.”The State Bank criticised slippages on the expenditure side

There were significant rigidities in government spending, including debt servicing, defence and the salary bill, but there appeared little evidence of efforts to contain the growth in even the discretionary components, it said.

A 10.7 per cent growth in subsidies and losses of public sector enterprises was particularly disappointing, it said.

“In FY10, these expenditures, as a percentage of GDP, were almost equal to the combined total for health and education,” it said, adding that this was by no means an acceptable situation.

The report said the total public debt and liabilities had substantially increased from 68.7 per cent of GDP in FY09 to 69.5 per cent.

It projected that workers’ remittances were likely to stay between $9.5 billion and $10.5 billion, while exports and imports were likely to be $20 billion to $21 billion and $34 billion to $35 billion, respectively.

 

[bc040400065]

Ogra drops petrol-bomb on the nation

ISLAMABAD: The prices of petroleum products were raised on Sunday by up to Rs7 per litre in the biggest single-time increase in years, a decision that can intensify public anger against the government already being blamed for failing to curb inflation.

A notification issued by the Oil and Gas Regulatory Authority (Ogra) says the increase was to match a similar trend in the international market during the month of October.

The highest raise was in the prices of high octane blending component (HOBC), which went up by Rs7 per litre from Rs79.56 to Rs86.67. The price of premium gasoline (petrol) was increased from Rs66.99 to Rs72.96, recording an increase of Rs5.97 per litre.

Similarly, light diesel oil will now be sold at Rs66.61, up from the previous rate of Rs62.34 per litre. The price of kerosene has been set at Rs70.95 after an increase of more than Rs5.

The new prices will be applicable from midnight November 1. The Oil and Gas Regulatory Authority is an independent body and reviews prices of petroleum at the end of every month.

The raise comes after several months during which the prices had seen a continuous downward trend.

Ogra spokesperson Syed Jawad Nasim told the media that the authority had no option but to readjust prices upwards because a cash-starved government could not pick up losses by giving subsidies.

He pointed out that the authority had launched an inquiry into reports that owners of fuel stations across the country had already suspended supplies to consumers in anticipation of the raise. “We are probing into it and will penalise those found guilty,” he said.

The international oil prices have been showing upward trends as Brent (London) was traded at $82.25 a barrel and the basket of Opec (Organisation of Petroleum Exporting Countries) rose from $78.71 to $79.26 per barrel last week.

Average Arab light crude oil price stood at $74.39 per barrel during September, which forced the government to announce a nominal cut in prices of petroleum products in line with reduction in the global prices, effective from October 1, 2010.

Published in The Express Tribune, November 1st, 2010.

Ogra drops petrol-bomb on the nation – The Express Tribune

 

[bc040400065]

Record rise in sugar price

Peshawar—The crisis of sugar continued in provincial capital as its price was surged to a record Rs.90 per kilogram in the City’s market and traders are looting people on both hands. The recent hike of sugar prices also affected the businesses of sweets, bakery and other related business and demand of ‘Gur’ has been increased in local markets.

A top sugar dealer on Ashraf Road, Shakir Ullah Khan told APP that rapid surge in sugar prices were due to recent flood in Khyber Pakhtunkhwa. The traders had stored sugar in private godwons to create artificial shortage. On Sunday, the price of sugar is Rs.55 per KG at utility stores while the same are being solve at Rs.90 at open market, added to the miseries of middle class and poor.

“The shopkeepers are demanding money of their own choice and people are being refused to get the commodity after not paying the amount demanded by the dealers,” Khurshid Khan told APP. He said that he can’t afford to buy a KG sugar despite the demand of my family for upcoming marriage of my brother. The shopkeeper said if urgent measures were not being taken, the sugar crisis would go worsen in the coming few months.

The shopkeeper said the recent flood has badly damaged the cultivated land in KPK and one year would be required to address this issue. Khan said there was no other solution but the government would have to import one million tons of sugar to meet the expected shortfall of the current season. An official of Food Department told APP that sugar industry was a highly regulated sector in KPK and the government is thoroughly observing the situation. He said strict action would be taken against hoarders and price hikers.—APP
Record rise in sugar price

 

[bc040400065]

Electricity tariff to rise two per cent

LAHORE: The government has decided to raise the electricity tariff by two per cent per annum on the directives of IMF.

This decision was taken based on repeated IMF directives calling on the government to introduce reforms in the power sector. The government has decided to gradually call off the subsidy on electricity thus shift the burden to the general public.

The enhancement of electricity tariffs by two per cent each year is an attempt to comply with IMF conditions regarding the release of the $11.3 billion loan to Pakistan.

The last IMF review was completed in May and the review for the release of the sixth tranche has been delayed since August over several issues, such as an increase in power tariffs and implementation of reformed general sales tax (RGST).

A notification from the Ministry of Water and Power in this regard is likely to be issued on November 1.


Electricity tariff to rise two per cent – The Express Tribune

 

[niaz]

I am deeply interested in the economic development of my country but I find that many of the claims are exaggerated and over ambitious targets set in the budget. Benefits of the new projects are also blown out of all proportions and political points scored ignoring economic realities.

Privatization of steel mill is a case in point. About 4years ago we could have sold the mill and received almost half a billion dollar into the bargain, but opposition thought that we were selling a multi billion dollar asset at throw away prices. Supreme Court ruled to reverse the agreed deal. We see that for the last three years the same asset is now a white elephant and a drain on the national economy. Exaggerated claims were made regarding the benefits of the Gawader port. Port is nearly complete but we don’t see any great benefit so far.


I found the following article which explains that as a nation we don’t use our grey cells very often but think with the seat of our pants instead.

This was published in today's Daily News.




Angry young nation

Mosharraf Zaidi
On October 30, The Indus Entrepreneurs or TIE held a national conference on entrepreneurship whose theme was “Unleashing Change”. Without a generation of innovators and entrepreneurs, job creation in Pakistan will stay dormant, while our population and its appetite for consumption goes through the roof. TIECON 2010, as the conference was branded was a great success. It brought together many experienced entrepreneurs to share their experiences with aspiring tycoons. The issue of entrepreneurship and the value it adds to the economy, to society and to politics needs greater attention than it gets, and organiser Moonis Rehman did very well in bringing it to light through TIECON 2010.
The one aspect of the conference that disappointed however was an aspect, that in recent months, I have found to be common to virtually every conference, workshop, seminar or discussion I attended. It may be the single most disturbing aspect of public life in Pakistan. Our national public discourse has become so irrational, personalised, emotive and imbalanced, that a substantive and honest discussion about important issues has become nearly impossible.
At TIECON 2010 as at other recent events I have attended, through no fault of the organisers, I have seen people stand up and make speeches, where they’ve been invited to ask questions. Not speeches about the depth and breadth of the topic at hand. No, no, no – political speeches that belong in Jamshed Dasti’s kutchehri and not in a serious policy discussion. I have watched young people, students no older than 18 years of age shout into microphones, wailing about inflation, and corruption, and terrorism. Were these young Pakistanis at a political rally or were they participating in a drunken discussion about teenage angst and their collective frustrations? No. They were attending a serious conference in a room full of senior business leaders, government officials and social workers. I have watched retired senior Pakistani citizens veer off course from painstakingly crafted seminar agendas so that they can postulate tired old Marxist, or Islamist, or post-modernist theories about what is wrong with Pakistan.
Everybody wants to make a speech, and be angry. Everybody wants to make rebuttals based on how they felt when they woke up. People are getting bolder and bolder. I’ve watched otherwise serious people begin questions and comments with a very honest and disturbing acknowledgment of their anger, “You know, I am very angry...”. Old people, young people. Women and men. Leaders and followers. Everyone is part of this new culture of shouting and screaming and making the quality of the national public discourse nearly unbearable. If you are getting tired of the migraine from this unending national shouting match, you are probably not alone.
What is the answer? Rather, first of all, what exactly is the issue? Far too many times we misdiagnose the problem. Two of the most commonly made assertions about the problem statement, ideology and manners, don’t accurately reflect the real problem.
Partisanship often tends to drive a lot of the criticism in national discourse. The terms liberal extremists and media Taliban are used by folks occupying different ends of the ideological spectrum. If two people at either end of a debate are shouting at each other, the problem of shouting isn’t that one person is a so-called Taliban, and the other, a so-called liberal. Clearly, the quality of the national discourse has little to do with what ideology you follow or represent – even if one group has, by dint of larger numbers, a greater capacity to shout and intimidate. A generic lack of civility or manners also seems to be a poor explanatory instrument for the poor quality of the national discourse. We don’t have to be civil just for appearance’s sake. Civility is a personal choice people make based on how they are raised as children, and what their view of courtesy and its social value is. Indeed, aggressive speech may not always be a bad thing.
One’s ideology or degree of civility does not constitute the real problem in the national public discourse. The real problem is that the discourse is divorced from facts, from data and from reason. It is a largely irrational public discourse.
The anger with which people are expressing themselves, at conferences, in living rooms, and on the television talk shows that help sell millions of bars of soap, mobile telephone connections and fizzy drinks is a product of frustration. This frustration is a product of ignorance. We simply do not have a culture of numeracy. We don’t use enough data to engage in a constructive national public discourse about any of the major issues confronting Pakistan and its future.
This is terrifying in a country of 180 million people that requires urgent and drastic changes in virtually every sphere of public life. We need data to conduct better delivery of social services, like education. For example, did you know that more than 40 million Pakistani kids between the ages of 5 and 18 are not in any kind of school? If you did, would teacher-training, or curriculum reform deserve the same attention in a discussion about education as school enrollment and dropout rates?
We need basic facts to decide whether we should roundly condemn entire countries, or whether countries are vast and large and offer a multitude of things. For example, did you know that among the most credible sources of information about drone attacks are in fact American non-profit organisations, some that are funded by the US government? These American think-tanks and advocacy groups have done the lions’ share of work in quantifying how many drone attacks take place, what kind of damage they do, and what kinds of problems are involved in the deaths of innocent civilians. Two of the most important American organisations working on drone attacks are the New America Foundation, and Campaign for Innocent Victims in Conflict (CIVIC). CIVIC has recently published an excellent report on the deaths of innocent civilians in Pakistan, titled “Civilian Harm and Conflict in Northwest Pakistan” by Chris Rogers. It is a vital piece of research in the debate around drones that has scarcely received the attention it deserves. Yet every evening someone or the other is railing about these drones on television.
Fiscal policy, interest rates, foreign affairs, cricket management, post-disaster relief and recovery. No matter what area of public life, none can be addressed without data, and information – of which we use so little in our national discourse.
It is easy to throw unsubstantiated allegations into the atmosphere in Pakistan because numeracy and evidence have no place in the debate. The frustration of not knowing is what produces a culture of all-knowing ignoramuses – frothing at the mouth on television talk shows, spewing venomous allegations about international conspiracies on Twitter and Facebook, making Bhutto-esque speeches during question hours at serious conferences. This high-volume nonsense is an expression of our collective helplessness. This helplessness can only be addressed through the empowerment that knowledge offers. How can we start? By turning off the TV and opening a book.
The writer advises governments, donors and NGOs on public policy. Mosharraf Zaidi

Angry young nation

 

[Asian.Century]

LSE eyes new investors

LAHORE: Managing Director of the Lahore Stock Exchange (LSE) Aftab Ahmad Chaudhry has said that he will target new investors, including institutions, workers, students and others to encourage them to invest more in the capital market.

Speaking at the first press conference after taking charge of the bourse at the LSE on Wednesday, he said the working of the stock market would be improved and the management would be answerable to members as well as investors in the future.

He said he would also tackle the issue of companies which were actually running in profit but showed losses in order to avoid dividend payments to shareholders.

Besides, the bourse management would contact such companies which have sufficient provident funds and worker welfare funds but were investing in savings schemes and banks.

“We will convince them that the stock market is offering good opportunities and returns of up to 15-18 per cent, and that there is minimum risk to their savings.”

He dispelled the impression that some brokers have great influence to drive the market upwards or downwards. He said some new products would also be introduced in the market, like real estate investment trusts.

Published in The Express Tribune, November 4th, 2010.

 

[RabzonKhan]

Pakistani exports surge by 26pc on weak rupee

November 24, 2010
By Salman Siddiqui

KARACHI: Pakistan has achieved an all-time high export growth of 26 percent in exports during October over the same month last year, data released by the Trade Development Authority of Pakistan (TDAP) said on Tuesday.

The growth in goods’ value was in dollar terms, amounting to $1.989 billion in October against $1.577 billion recorded during the corresponding month last year.

TDAP Chief Executive Tariq Iqbal Puri said that the demand of goods has yet not recovered to the pre-recession levels.
On the contrary, the value of dollar has surged in parity with the rupee over the period, which was reflected in the export figures. “The provided situation will augur well to achieve $20 billion exports mark for the fiscal 2010/11.”

Puri said that European Union and USA were the two major sufferers of the recession and simultaneously the two major markets of Pakistan and both the world powers were yet to recover from the slump. “More than 50 percent exports of Pakistan go to EU and US.”The main drivers of this export growth for the last month was knitwear, which earned nearly $207.65 million in exports with over 39 percent growth.

Sector wise, the exports of textile topped the list of exports with 31.55 percent growth to $1.189 billion, followed by food and manufacturing. Both the last two sectors showed a growth of above 19 percent to $273.85 million and $323.5 million, respectively.
The petroleum group and cola exports declined by over 26 percent to $66 million from $89.5 million in October 2009.

Consolidated export figures for July/October period, which was $7.17 billion, was 19.2 percent higher than the similar period of last financial year. Knitwear and cotton cloth were the driving agents in reaching this level of exports. Their exports value stood at $754 million and $734 million, respectively, in the period under review. Bedwear, readymade garments and cotton year were the items which have crossed the $500 million mark during the first four month of the fiscal year 2010-11, TDAP said.

 

[unicorn]

IT exports: Pakistan can beat neighbours


Lahore—Pakistan has the potential to outpace a number of its neighbours in IT exports by providing facilities to its entrepreneurs attached with this sector. This was stated by the LCCI Senior Vice President Sheikh Mohammad Arshad while speaking at the inauguration of the LCCI Web Development class here on Wednesday. The LCCI Vice President Sohail Azhar, Executive Committee member Ibrahim Qureshi and former EC member Sardar Usman Ghani also spoke on the occasion.

Sheikh Muhammad Arshad said that Pakistan could bridge the development gap in the shortest time by excelling in Information Technology. He said that years long governance issues could also be resolved in matter of minutes through proper utilization of Information Technology.

He said that the Lahore Chamber of Commerce & Industry was giving special attention towards the IT sector to achieve the goal of progress and prosperity. He said that India was making huge money software export to the developed world but unfortunately Pakistan was still far behind despite having marvalous talent.

Sheikh Muhammad Arshad said that the development of entrepreneurs was one of the prime tasks of the Lahore Chamber of Commerce and industry so that they could be able to present themselves and their products in the international market in a winsome manner. He said that the LCCI IT courses would strengthen Pakistani entrepreneurs in the international market and they would be able to sell their products with new confidence.

He said that apart from conducting IT-related courses, the LCCI was also conducting language courses at its premises and the vary objective was to enable the business community to express itself in the other countries.

 

[unicorn]

Engro Coal Power Project faces infrastructure deficiency

Karachi—Engro tends to complete its Thar Coal based Power Generation Plant well in time but Government agencies have yet not provided the required infrastructure, hence delaying the target date. Asad Umar, President & CEO of Engro Corporation Limited disclosed this while delivering a lecture on “Economic Outlook of Pakistan” hosted by Marketing Association of Pakistan at a local hotel on Wednesday evening.

Replying to a question he elaborated that there were four vital factors required for this four billion dollar worth first of its kind power project in Pakistan. This included construction of Roads, Supply of Potable Water, Arrangement for Drainage Water, and Laying of Transmission Line for the power produced. These were the responsibilities of Sindh Government but even after six months she was unable to respond in this matter, he said.

Earlier, in his speech Asad Umar highlighting economic conditions in the country stated that in year 2005 to 2007 the annual borrowings by Central Government were not more than Rs180 billion while private sector had borrowed 768 billion rupees when the interest rate was 8.5 percent. But in year 2008 to 2009 while bank interest rate was escalated up to 12.5 percent the Government borrowings enhanced up to 931 billion rupees and private sector was restricted to Rs132 billion only. This is not a healthy sign government should strictly review its balance sheet by not only increasing its income but also controlling its expenditures, which were curtailing the GDP growth rate. We need a 7 percent GDP growth but in prevailing circumstances it could not be expected beyond 3 to 4pc, Umar added.

Citing contradictions in government policies he said that all light and heavy industrial units are facing scarcity of gas supplies, but despite promises government was unable to fulfill their need. For example Dharki Urea plant is the biggest urea manufacturing unit in the world but instead of running it at full capacity government was importing millions of tons urea from abroad at the rate of $380 per ton. This was not in the interest of national economy.

Asad said the petroleum and natural resources minister Syed Naveed Qamar and finance minister Hafeez Shaikh were quite intelligent in performing their duties but still the things were not working properly and no results were achieved which was amazing.

 

[Introvert]

Pakistan rice exports may hit 4 MT in 2010/11-trade

ISLAMABAD: Pakistan’s top rice export body said on Tuesday it aims to export 4 million tonnes in fiscal year 2010/11, about 1 million tonnes more than previous estimates made after destructive floods in August.

Irfan Ahmed Sheikh, chairman of the Rice Exporters Association of Pakistan (REAP), said total rice production would be nearly 6 million tonnes.

A senior food ministry official on Tuesday, however, low-balled REAP’s estimate and said output would be about 5 million tonnes.

“We dispute the government’s figure,” Sheikh told Reuters. “Our assessments are that the production will be nearly 6 million tonnes. We are now aiming to export about 4 million tonnes of rice this year on good global demand.”

REAP’s export target tops previous trader estimates by almost a million tonnes.

The government in September estimated losses of up to two million tonnes from the August floods. Before the floods, the food ministry expected 6.1 million tonnes for the 2010/11 crop.

The country’s eight-month-long rice season runs from April to November and final estimates of the crop size will not be available until late December.

The reason for the increased estimate, Sheikh said, is that the monsoon floods, which devastated more than 2.4 million hectares of farmland, did not affect the rice crop in the Punjab province, which produces 60 percent of the total national output.

Production losses in the second-largest rice growing province of Sindh were estimated at about 500,000 tonnes, but that would largely be offset by the better yield in Punjab, Sheikh said.

The president of the Agri-Forum Pakistan agreed with the REAP’s production estimates.

“Despite losses in Sindh, our production estimate is between 5.7 million tonnes and 6.1 million tonnes, as per-acre yield in Punjab has increased by up to 10 percent,” said Ibrahim Mughal.

Pakistan had a bumper crop of 6.7 million tonnes of milled rice in 2009/10 and exported about 4.5 million tonnes.

Pakistan retained up to 800,000 tonnes from the 2009/10 crop, traders said.

The country’s domestic consumption of milled rice is about 2.3 million tonnes.

Rice exports in July-October 2010 rose by 17.26 per cent to 1.1 million tonnes, compared with 940,838 tonnes in the same period last year, according to the Federal Bureau of Statistics.

In the July-Oct period in 2010/11, exports of basmati rice stood at 304,141 tonnes, almost the same as last year. Other varieties totaled 799,052 tonnes for the same period, compared with 636,773 tonnes.

Rice is Pakistan’s third largest crop after wheat and cotton and contributes about 1.6 percent to the country’s gross domestic product.

Pakistan rice exports may hit 4 MT in 2010/11-trade | Latest news, Breaking news, Pakistan News, World news, business, sport and multimedia | DAWN.COM

 

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‘UAE single largest investor in Pakistan, Pak exports to UAE at $2bn’

KARACHI: United Arab Emirates Consul General in Karachi Suhail Bin Matar Al-Ketbi said UAE is single largest investor in Pakistan, one of major economic, trading partner and currently volume of Pakistan’s annual exports to UAE is over $2 billion.

Speaking on 39th National Day of UAE, he announced launch of commercial department at UAE Consulate in Karachi to assist all UAE investors who have invested in Pakistan and also bring any future opportunities helpful to build strong ties between two countries. Commercial department will provide services for UAE businesses to ensure they have accurate information to develop successful business and export marketing strategies, he added. He said Pakistan culturally, geographically, strategically enjoys very strong ties with UAE, which flourished since decades and developed into wide-ranging co-operation in various fields.

Emerging economic ties between two brotherly states is not only paving way for further strengthening economy but also lead to economic cooperation among Islamic world. Al-Ketbi said large number of Pakistani expatriates, numbering nearly 800,000 is gainfully employed in UAE, while major investments made by UAE companies in Pakistan.

Some of the prominent organisations are Pak Arab Refinery, PTCL Etisalat, UBL, Bank Alfalah, Warid, Wateen Telecom, Giga Group, Al-Ghazi Tractors, Emirates Air, Etihad Air, Pak Gulf Construction, CNBC, IFFCO, Dubai Ports World, Abraaj Capital, Emaar, Dubai Islamic Bank. ppi

Daily Times - Leading News Resource of Pakistan

 

[Introvert]

Malaysia Top Importer From Pakistan In Asean Region

KUALA LUMPUR, Dec 3 (Bernama) -- Malaysia is the top importer from Pakistan for the second consecutive financial year (July 2009 to June 2010) out of 11 countries in South East Asia.

Imports stood at US$194.72 million in the financial year 2009 to 2010, whereas the Philippines, with an import of US$156 million, and Vietnam with US$126 million, were the second and third largest importers, respectively, said the Pakistan High Commission here in a statement on Friday.

Pakistan High Commissioner to Malaysia Masood Khalid said his country's exports to Malaysia recorded an unprecedented increase of 56.56 per cent with imports of US$194.72 million in 2009-2010 compared with exports of US$124.37 million in 2008-2009.

Referring to the latest data released by the Trade Development Authority of Pakistan, Khalid said there were many untapped areas like gems and jewellery; marble and stones; light engineering; cutlery; spices; leather; fruits; and vegetable; handicrafts; raw wool; sports goods; pharmaceutical products; readymade garments; meat; and meat-based products.

These products could be tapped to broaden export base to Malaysia which currently revolves around traditional items like rice, fish, yarn, woven fabric of synthetic stable fibre, electrical appliances, line telephony, potatoes, onions and corn, he said.

He urged Malaysian and Pakistani traders and businessmen to fully exploit the concessions available to them in duties, taxes and tariffs under the Free Trade Agreement (FTA) signed by the two countries in 2007.

He said they could also make use of the Joint Business Council for business networking and match-making to bring about a multi-fold increase in the existing volume of bilateral trade.

According to the data, out of the total of 66 commodities exported to Malaysia, 36 registered increasing trend, with rice leading the list with five times increase with an export of US$52.13 million (2009-2010) compared with US$9.64 million (2008-2009).

Vegetables recorded two-fold increase with an export of USS10.75 million compared with US$4.96 million.

Cotton yarn registered an increase of 46 per cent and readymade garments 83 per cent) were among the biggest contributors.

Other commodities which saw increasing trends are paper and paper board, plastics, specialised machinery, leather footwear and auto parts.

BERNAMA - Malaysia Top Importer From Pakistan In Asean Region