Pakistan Economy - News & Updates - Archive

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ISLAMABAD (April 28 2006): Total budgetary expenditures on poverty reduction programme during the first half of the current fiscal year rose by 33.18 percent to Rs 166.1 billion as compared to Rs 124.68 billion in the same period of the last year, Finance Ministry reported on Thursday.

The Poverty Reduction Strategy Paper (PRSP): Progress Report For the second Quarter of FY 2005-06 released by the ministry said that out of the total budgetary expenditures on 17 pro-poor sectors, education sector received largest proportion of 35 percent (Rs 58.068 billion). This was about 16 percent more than the expenditures increased during the same period of the last year.

Education sector was followed by law and order with Rs 25.428 billion or 15.3 percent of the total expenditures, showing 19.3 percent increase over the first quarter of the current fiscal year.

The expenditures on irrigation was the third highest, ie, Rs 23.81 billion (14.34 percent of the total PRSP expenditures), showing 90 percent increase than the first quarter.

During the second quarter of 2005-06, the government spent Rs 14.915 billion or 8.98 percent of the total expenditure on health; Rs 13.946 billion (8.4 percent of the total) on roads, highways and bridges; and Rs 8.487 billion (5.1 percent of the total outlay) on natural calamities such as October 8 earthquake, which was 35 times more than Rs 242 million spent during the last fiscal year.

The expenditures on rural development rose by 10.3 percent to reach Rs 7.398 billion in the second quarter as against Rs 6.079 billion during the same period of the last fiscal year.

Water supply and sanitation expenditures increased by 69.7 percent to reach Rs 3.665 billion, population planning by 83.2 percent to Rs 2.871 billion; social security and welfare by 4.8 percent to Rs 2.085 billion; administration of justice by 8.8 percent to Rs 1.508 billion and expenditures on food subsidies rose by 6.1 percent to reach Rs 1.125 billion during the second quarter of 2005-06.

The budgetary expenditures on rural electrification during the second quarter of the current fiscal year stood at Rs 969 million against the budgetary expenditures of Rs 371 million in the same period of the last fiscal year, indicating an increase of 161.2 percent.

Expenditures on four programmes, ie, Tawana Pakistan declined by 100 percent, Food Support Programme decline by 69 percent, low-cost housing down by 24.9 percent and land reclamation declined by 9.8 percent as compared to the expenditures during the same period of the last fiscal year.

The expenditures on land reclamation during the second quarter of the current fiscal year stood at Rs 971 million against the budgetary expenditures of Rs 1.076 billion in the same period of the last fiscal year, depicting a decline of 9.8 percent.

The PRSP budgetary expenditures on the Food Support Programme during the second quarter of the current fiscal year stood at Rs 637 million against the budgetary expenditures of Rs 2.053 billion in the same period of the last fiscal year, showing a decline of 69 percent.

Like the first quarter, the government had not spent even a single rupee on Tawana Pakistan Programme in the second quarter of the current fiscal year, however, during the same period of the last fiscal year it stood at Rs 59 million.

The expenditure on low-cost housing stood at Rs 172 million against Rs 229 million during the last fiscal year.

Expenditures on the pro-poor food subsidies stood at Rs 1.125 billion, which is 6.1 percent more as compared to the same quarter of the last fiscal year.

According to the break-up, Punjab's expenditure stood at 36 percent, followed by the federal government, 25 percent; Sindh, 18 percent; NWFP, 14 percent; and Balochistan, 7 percent of the total PRSP expenditure of 166.1 billion.

Largest increase (83 percent) in the PRSP budgetary expenditures during H1-FY06 over the same period in FY05 was witnessed in NWFP, which reached Rs 23 billion, primarily due to the October 8, 2005 earthquake.

More than 100 percent increase in PRSP budgetary expenditures by the federal government during H1-FY06 as compared to H1-FY05 was witnessed in population planning, natural calamities, irrigation and rural electrification.

During the same period, an enormous increase in expenditures were made by Punjab province in water supply and sanitation of which 88 percent expenditure was on development, indicating that the Punjab government is giving priority to this sector. Except for land reclamation, food support programme and low-cost housing, all other sectors in Punjab witnessed increase in H1-FY06 over H1-FY05.

Sindh witnessed increase in PRSP budgetary expenditures in most of the sectors, except rural development, food subsidies and food support programme. In Sindh there was an increase of 41 percent to Rs 30 billion in PRSP expenditures made during H1-FY06, as compared to the same period in FY05.

During the same period Balochistan registered an increase of 23 percent to Rs 11 billion in PRSP budgetary expenditures. Largest increase in expenditures was due to natural calamities in Balochistan, whereas increase was also witnessed in roads, highways and bridges, education, health, population planning, social security & welfare, irrigation, rural development, administration of justice and law & order.

 

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PESHAWAR (April 28 2006): Central Board of Revenue (CBR) Chairman Abdullah Yusaf said that inflation rate in the country had been cut down by 3 percent during the current financial year.

He said that during the last financial year the rate was 11 percent, which had been brought down to 8 percent and efforts for further cut in it were continued.

Addressing a meeting of industrialists and traders here at the Sarhad Chamber of Commerce & Industry (SCCI), he said the government was taking measures to keep check on the prevailing inflation rate and control price hike in the country.

Regarding the unprecedented upward trend in the prices of food items, he said they linked to the supply and demand in the market.

SCCI President Ghazanfar Bilour presided over the meeting while prominent among those present on the occasion were Senator Ilyas Ahmad Bilour, Ghulam Sarwar Khan Mohmand, Zia-ul-Haq Sarhadi and senior officials of Pakistan Customs, Income Tax and Sales Tax.

The CBR chairman said that the trend of prices of food items had been changed all around the world due to unprecedented increase in the price of petroleum and a big sugar producing country had converted its industry to the use of ethanol.

He said the shortage had been occurred all around the world and governments are not in position to subsidise it. He said that three years back the price of one barrel petrol in the world market was just 25 dollars, but now it had climbed to 75 dollars.

"Such a big increase in the petrol price is out of control and has affected the entire world," he added. He said that the government even granted tax exemptions to sugar mill industry to facilitate the millers and provide cheap commodity to the people.

The CBR chief said the country has sufficient wheat stock this year and there was no pressure on its prices.

He expressed concern over the trade deficit and said it was due to lack of balance in payment and the imports were being made out of value. He termed increase in the price petrol a discouraging point. He said that import of machinery and raw material had registered increase, similarly, services sector had also registered unprecedented increase and the number of mobile phone consumers had climbed to 24 million in the country.

He said that per line cost of the company was $200 million and investment made in the sector is about $8 billion.

The agriculture sector, he said had also registered improvement and today Pakistani growers were getting price of their products according to international standard.

He said the sugarcane was being sold at the price of more than Rs 100/-per tonne, inflicting heavy loss to the sugar mill industry paid by the consumers. He said that micro-economic indicators of the country had shown improvement in increasing the credibility of the country, adding that issuance of 500 million dollars and 300 million dollars were ample proof of the people's confidence in the economic policy.

Abdullah Yusaf stressed substantial expansion of the tax net to fill the prevailing gap between tax and GDP ratio in the country. He said that Pakistan had a base of 1.3 million tax payers among which 0.6 million were government employees.

He said the trend was changed and now the total revenue had rose from Rs 300 billion to Rs 700 billion in just few years and further increase was in pipeline. But, he said, "despite these good figures we are still the lowest tax growth country."

He said, "last year we had set a 20 percent increase in the revenue growth, which will be raised by the same ratio this year too. For this purpose, he urged on the business community to educate their colleagues that government had reposed trust in them through initiating Universal Self-Assessment Scheme.

He said that further improvement would be made in the system and staff would be imparted better training to subside the culture of harassment of the taxpayers.

Yusaf Abdullah informed that retailers and whole sellers have 16 percent share in GDP and 2 percent in tax while transport sector has 16 percent share ratio in GDP and 4 percent in tax, saying that out of the millions of tax payers the number of retailers is 40,000.

He rules out exemption from sales tax on minimum sale, adding that the decision would not bring any positive result and was being considered impracticable. "There should not be one-way traffic and business community is also required to cooperate with the government in this connection," he added.

He said now the system had been totally revamped, and the businessmen should also acknowledge their responsibility and mobile them for filing of tax returns and serve the country. The change, he opined would ultimately come as they are making utmost efforts for it.

Regarding export, the CBR chief said it had been increased by 28 percent in rupees and 42 percent in dollar during the last 9 months of the current financial year, which is a record.

The matter of concern was that 42 percent increase in dollar export had been registered during the 9 months with 100 percent increase in the payment of Rs 2.2 billion as refund while during the same period last year the payment was Rs 1.2 billion.

Such unprecedented increase in the refund has created an impression that there is something wrong in the system resulting in billions of rupees loss to the national exchequer. "The exporters in some cases have filed fake claims in collaboration with the officials of CBR, inflicting heavy loss to the country," he said.

He assured that the government was interested in the promotion of genuine export not merely on papers.

About difficulties in the verification of export goods through the customs authorities of Afghanistan, he asked the business community to give a workable and authenticated solution into the matter.

He said, the CBR wanted to introduce fair and transparent system and would not allow any one to file fake claims.

 

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FAISALABAD (April 28 2006): The Asian Development Bank (ADB) will provide a loan of $42.0 million from its special funds resources for "Federally Administered Tribal Areas Rural Development Project".

Which is designed to improve the productive potential of selected micro-watersheds and their associated natural resource base and to strengthen the planning, implementation, and management capacity of the target communities and implementing departments in the project area.

According to official sources, the total project cost is estimated at $60.4 million equivalent. The Pakistan government will provide $15.4 million equivalent, or 25 percent of the project cost. Project beneficiaries will contribute $3.0 million equivalent or 5 percent of the project cost through labour and other in-kind inputs.

The Asian Development Bank (ADB) will provide a loan of $42.0 million from its special funds resources. The loan will have a 32-year term, including a grace period of 8 years and an interest rate of 1.0 percent during the grace period and 1.5 percent per annum thereafter.

The Federally Administered Tribal Areas Rural Development Project will be accomplished by improving community infrastructure for production and communication, establishing effective and broad-based community organisations focused on development, increasing production from renewable natural resources, and strengthening agency-based planning, implementation, and capacity for improved service delivery to communities.

The project will generate significant quantifiable and non-quantifiable benefits. Effective implementation of the project will have a direct impact on household incomes.

Farm and livestock packages will increase the productivity of about 52,500 hectares on rain-fed (barani) lands and benefit around 37,500 households. It will also strengthen food security and improve the nutritional status of farm families.

The integrated approach involves the complementary management of natural resources, agriculture, and range management. Effective forestry and range management will ensure water harvesting and recharge of groundwater resources, check soil erosion, and provide forage and foliage to livestock.

The construction and rehabilitation of irrigation and small-scale water storage structures will ensure the availability of irrigation and drinking water supplies. Improved farming and livestock rearing practices and additional income from rehabilitation of the natural environment are livelihood strategies that will be made available for the benefit of individual households. The target population will obtain access to opportunities for improving their livelihoods, broaden their networks of knowledge and contacts with service providers, and learn more productive farming practices with all the community sharing access to new and improved supporting infrastructure.

Project initiatives focus on improving the quality of life for the region's inhabitants. Activities include establishing sustainable productive technologies with arrested environmental and resource degradation through integrated resource management, including agriculture and livestock production, and farm and community forestry. New construction and upgrading of existing infrastructure for production, water consumption, and transportation represent significant aspects of the project. Project management will operate closely with government line departments and the project will be implemented through community participation to improve community involvement in designing and implementing project interventions. Capacity-building initiatives, as well as training in community organisation, strengthened project management skills, and improved institutional capabilities for line departments to better address the needs of the poorer segments of the society are important project activities.

Poor and inefficient management of available natural resources contribute to the pervasive poverty in the Federally Administered Tribal Areas (Fata). The poor farm and livestock productivity and consequent poverty restrains transition from below-subsistence livelihoods. Capacity and the ability to explore other opportunities are restricted by poor access to productive and physical infrastructure. The degradation of the physical environment, if not checked, will worsen the situation.

 

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ISLAMABAD (April 28 2006): Pakistan and China have decided to launch cargo service through land route by next month. Well placed sources in the Communication Ministry told Business Recorder on Wednesday that all necessary arrangements had been made to start import/export goods transportation between the two countries.

"We have agreed to open up land routes for transportation of goods from May 1, and it is most probably going to start in the first or second week of the next month," the sources said. Pakistan and China had already pledged to start a bus service from June 1.

Officials privy to the development said that initially two operators, the National Logistics Cell (NLC) and Northern Areas Transportation Company (Natco), would start cargo service from Pakistani side.

Pakistan Tourism Development Corporation (PTDC) would be in business when the bus service would be launched in June.

"We will welcome private sector's participation. We are ready to issue permit to any private operator who meets our laid down criteria," an official said, adding that permits would be issued by the Communication Ministry in consultation with the Northern Areas administration.

According to details, all the permissible goods between Pakistan and China would be imported or exported through the land route under this initiative.

The Central Board of Revenue (CBR) would deal with all such affairs, the sources said.

The authorities hoped that the initiative would not only help in strengthening Sino-Pak bilateral trade, but would also provide Pakistani products access to the Chinese market.

Currently, Pakistan export cotton, leather products, minerals and seafood to China, while China's main shipments to Pakistan include machinery, equipment, chemicals, electronics and footwear. China is very keen to use Pakistan as a transit route for Central Asian markets.

 

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Friday, April 28, 2006

KARACHI: SITE Association of Industry (SAI) has expressed grave concern over the performance of Karachi Electric Supply Corporation (KESC).

Acting chairman SAI, Saboor Ahmed on Thursday said more than 60 percent of power shutdowns and loadshedding occur because of breakdowns and tripping at grids.

He said the KESC has resorted to the worst loadshedding schedule on industries since April 25. It circulated a notice to the association informing that due to fault on a main 220 KV linking circuit of KESC between Bin Qasim Power Station and Korangi Creek Road Grid Station, KESC had to resort to load shedding in industrial areas fed from SITE, Haroonabad, Hub Chowki, Mauripur and North Karachi grid stations in addition to residential load shedding.

He said KESC issued notices regarding the theft attempt on blue conductor without indicating when the repair work would be completed. This compelled the industries to brave loadshedding for an indefinite period.

Mr Ahmed said export-oriented industries in particular, which are operating round the clock are finding it difficult to fulfill the export order commitments.

He claimed the loadshedding damages latest expensive machinery employing electronic (computer) systems and secondly the cost of production goes up steeply for obvious reasons.

He said the industrialists are not satisfied with the performance of KESC while public utility authorities and engineers are not keeping the industrialists informed of the factual position and the developments taking place for restoration of normal supply to industries. He said SITE industries are faced with LT and HT Cables Network that stands totally crippled thereby leading to intermittent supply of electricity.

He said out of 59 feeders in SITE area 85 percent feeders are victim of overloading and tripping as a result of which frequent breakdowns are occurring with 4-5 hours interval. He said that one of the objectives behind privatization of the power company was to improve its efficiency and working condition. Unfor-tunately, recent events have shown that there is marked deterioration in the quality of service and supply.

He urged the governor of Sindh, Dr Ishrat-ul-Ebad, the minister for water and power Liaquat Ali Jatoi and the chief minister Sindh, Dr Arbab Ghulam Rahim to take serious note of the situation.

 

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US wants to spearhead power grid in Asia WASHINGTON (April 28 2006): The United States wants to spearhead a mammoth project transmitting electricity from Central Asia across Afghanistan to Pakistan and India, a senior State Department official said on Wednesday.

Under the plan, a regional power grid stretching from Almaty to New Delhi will be fed by oil and gas from Kazakhstan and Turkmenistan and hydropower from Tajikistan and Kyrgyzstan.

"This vision is within our grasp," Assistant Secretary of State for South and Central Asian Affairs Richard Boucher told a Congressional hearing.

"Within the next few years, we expect to see private investment lead to the establishment of a 500 kilovolt power line transmitting much-needed electricity from Central Asia across Afghanistan to Pakistan and India," he said.

The United States, he said, would like to have a strategic dialogue with the countries of the region to advance regional economic development and integration, of which the high-voltage power project was a critical component.

Central Asia has an abundance of existing and potential oil, gas, and electricity sources that the growing economies of South Asia need.

"Together with other donors, we are exploring ways to export electricity from Central Asia to Afghanistan, Pakistan, and India," Boucher said.

Boucher said that in partnership with multilateral development banks and other donors, the United States wanted to help "build new links" among the countries of the broader region and connect them more closely to the rest of the world.

"One of our leading objectives is to fund a greatly expanded Afghan power grid, with connections to energy sources in Central Asia.

"It's a winning solution for both the sides, providing much-needed energy to Afghanistan and serving as a major source of future revenue for countries like Tajikistan and Kyrgyzstan," he said.

New energy routes, Boucher said, would ensure that the next generation of South and Central Asian entrepreneurs had access to the resources they needed to prosper.

"We want to give South Asians access to the vast and rapidly-growing energy resources in Central Asia, whether they are oil and gas in Kazakhstan and Turkmenistan, thermal power in Uzbekistan, or hydropower in Tajikistan and Kyrgyzstan," he said. Boucher said that the 'opening' of Afghanistan had transformed it from an 'obstacle' separating Central from South Asia into a 'bridge' connecting the two. "And this in turn opens exciting new possibilities."

The US and Russian companies are now the major players in the contest to develop and export energy resources in Central Asia, but Chinese and Indian entities have become increasingly competitive in recent months.

Moscow has long considered Central Asian states to be Russia's sphere of influence and has viewed with alarm Washington's rising profile in the region, especially since the 2001 overthrow of Afghanistan's Taleban leadership.

Boucher said the United States supported establishing "multiple, commercially viable" pipelines and other new energy transportation routes.

The United States "believes that diversification of energy transport routes to and from Central Asia increases stability and energy security, not just regionally but throughout the world," he said.

In June, the US Trade and Development Agency will host a forum on the Central Asian electricity sector, which Washington hopes will spur investment and promote further regional co-operation, Boucher said.

"We are also funding feasibility studies in energy, transportation, and telecommunications, and co-ordinating with the International Financial Institutions and other donors," he said.

 

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Vehicles import yields Rs 8.29 billion: CBR
SOHAIL SARFRAZ ISLAMABAD (April 28 2006): The import of vehicles has yielded Rs 8.29 billion as customs duty during July-March (2005-06) against Rs 3.13 billion in the same period of the last fiscal year, showing an increase of 165 percent.

According to the data collected by the Central Board of Revenue (CBR), the import of vehicles during this period cost Rs 16.91 billion against Rs 7.50 billion in the same period of the last fiscal year, showing an increase of Rs 9.41 billion.

The board collected Rs 4.41 billion as customs duty on the import of plant/machinery in July-March (2005-06) against Rs 3.34 billion collected in the same period of the last fiscal year, reflecting an increase of 32 percent.

The value of plant/machinery stood at Rs 78.41 billion in the first nine months of the current fiscal year against Rs 44.86 billion in the same period of the last fiscal year, reflecting an increase of Rs 33.55 billion.

Sources said on Thursday that the value of plant and machinery is substantially higher than the overall cost of vehicles imported during this period.

The data have been compiled to ascertain the impact of fiscal measures/tariff rationalisations introduced in the Budget 2005-06 on the import of various items.

The CBR collected Rs 1.9 billion on the import of textile fabrics/yarn in July-March 2005-06 against Rs 1.6 billion, reflecting 15 percent increase; pure terephathalic acid (PTA), Rs 747 million against Rs 640 million (17 percent); agriculture machinery, Rs 1.8 billion against Rs 1.6 billion (15 percent); worn clothing, Rs 191 million against Rs 84 million and Rs 33 million were collected as customs duty on the import of chip during July-March 2005-06 against Rs 29 million collected in the same period of the last fiscal year.

The collection of customs duty on raw materials import stood at Rs 5.4 billion during July-March (2005-06) against Rs 7.3 billion in the same period of the last fiscal year, showing a decrease of 26 percent; chemicals, Rs 1.3 billion against Rs 2.5 billion (47 percent decrease); plastic raw material, Rs 2.2 billion against Rs 2.5 billion (12 percent decrease); dyes, Rs 1.4 billion against Rs 1.7 billion (18 percent decrease); edible items, Rs 391 million against Rs 575 million (32 percent decrease); wood, Rs 266 million against Rs 341 million (22 percent decrease); photographic goods, Rs 21 million against Rs 65 million (68 percent decrease) and collection of customs duty on the import of raw materials (confectionery) stood at Rs 29 million during July-March (2005-06) against Rs 7.3 billion in the same period of the last fiscal year, showing a decrease of 25 percent.

The data reveal that the collection of customs duty on paper and paperboard import stood at Rs 2.5 billion in July-March (2005-06) against Rs 2 billion in the same period of the last fiscal year, showing a growth of 23 percent; articles of iron and steel, Rs 1.6 billion against Rs 1 billion (47 percent); pharmaceutical products, Rs 969 million against Rs 831 million (17 percent); man-made staple fibre, Rs 675 million against Rs 607 million (11 percent); ceramic products, Rs 698 million against Rs 286 million (41 percent); aluminium and its by-products, Rs 657 million against Rs 594 million (11 percent); plastics and articles thereof, Rs 4 billion against Rs 4.2 billion (-4 percent); organic chemicals, Rs 2.9 billion against Rs 3.8 billion (-26 percent); chemical products, Rs 1.3 billion against Rs 1.6 billion (-13 percent); rubber and articles thereof, Rs 1.16 billion against Rs 1.22 billion (-5 percent); man-made filaments, Rs 1.14 billion against Rs 1.20 billion (-5 percent); tanning/dying extracts, Rs 1.14 billion against Rs 1.15 (-one percent) and collection of customs duty on the import of coffee/tea stood at Rs 1.20 billion against Rs 1.27 billion collected in the same period of the last fiscal year, reflecting, a decrease of one percent, the data added.

 

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ISLAMABAD (April 28 2006):

Pakistan and China on Thursday signed an umbrella memorandum of understanding (MoU), which said Islamabad will facilitate Beijing as energy corridor to help in streamlining its petroleum products import.

The MoU will provide a framework to both the sides to lay down a pipeline from Gwadar to Chinese border to supply crude oil from Saudi Arabia. Islamabad and Beijing had been working on a project to construct a coastal highway to establish a road link from Gwadar Port to the Chinese border to facilitate exports through land route.

Planning Commission Deputy Chairman Dr Akram Shaikh and visiting Chinese Minister for Federation of Industry and Commerce, Hu Deping, signed the MoU on behalf of their respective governments.

President General, Pervez Musharraf witnessed the signing ceremony held at the Presidency. Under the MoU, Islamabad will offer special incentives to the Chinese investors to allure them for more investment in key areas such as oil and gas, power and other export-oriented projects.

It said that Pakistan would set up special industrial zones in different parts of the country along with highways, coastal areas where Chinese investors will be provided all the basic facilities for setting up their industrial units or joint ventures with the Pakistani investors for mega projects.

After the signing ceremony, Dr Akram Shaikh while talking to Business Recorder said that the MoU was a significant development that would help Pakistan in facilitating China as energy corridor.

He said Pakistan and China were entering into a new regime to help each other grow in today's challenging world.

He added that the Chinese investors would identify areas in Pakistan for setting up new industrial units.

He said an understanding has been reached that China would help Pakistan in exploring its potential in different areas and increase exports by producing surplus stuff.

The visiting Chinese energy delegation also met President Musharraf and expressed their willingness to invest in Pakistan's oil and gas sector.

The representatives of local oil and gas sector companies were also invited for the meeting.

The president informed the delegation that the Government of Pakistan would provide them all-out support and facilities to carry out their business and industrial activities in a cordial atmosphere.

He said the government and the people of Pakistan have great respect for their Chinese brethren and they want Pak-China co-operation to grow further.

 

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Friday April 28, 2006

ISLAMABAD: Prime Minister Shaukat Aziz has said that government’s telecom deregulation policy, introduced over the last few years and privatization and opening up of the telecommunication sector has stimulated phenomenal growth in the sector.
Talking to Dr. Walid Moncimne, Senior Vice President, Nokia at the Prime Minister’s House today, the Prime Minister said that telecommunication sector is the fastest growing sector with 17% teledensity, which is fast growing, the country has 27 million cellular phone subscribes and the number is fast growth.

He said the polices of liberization and deregulation in the telecom sector has attracted hug investment and created over 10,000 jobs and we are expecting more investments in the sector.

The Prime Minister said that in today’s world information and knowledge are the driving focus of world economics. The government is investing in human capital in priority areas to build a knowledge economy in Pakistan.

He said that government targeting to achieve 25% teledensity with rural teledensity of 9% by the year 2009-10 increasing bandwidth usage through fixed and mobile from existing 800 Mega Bites (MB) to 6000 MB during the same period. Easy access to telephone service at affordable rates is a major step in promoting information society and laying the foundation for a more inclusive economy where telecom sector plays a catalytic role.

The Prime Minister said that the availability of highly skilled manpower and the investment friendly policies of the government make Pakistan an ideal place to be a reforms hub for production and trade.

Walid Moneimne said that his company is impressed with the dynamic policies of the government and tremendous development and growth taking place in Pakistan. He said Nokia want to invest in human resource development in Pakistan to employ then in their company.

Walid Moneimne said Nokia will set up in Pakistan centre for expertise for Middle East and Africa. They will also set up telecom expertise facility in Pakistan.

The meeting was attended among others by Minister of State for IT & Telecom Mr. Ishaq Khan Khakwani and senior officials.

 

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Friday April 28, 2006

ISLAMABAD: Federal Minister For Petroleum and Natural Resources Amanullah Khan Jadoon asked the delegation of Sichuan Petroleum to bring more rigs for expanding the oil and gas activities in country.
He stated this while talking to 8 member delegation from Sichuan Petroleum, China headed by its Vice President Zhang Benquen who called on Federal Minister for Petroleum and Natural Resources Amanullah Khan Jadoon here Thursday and exchanged views on investment opportunities in the petroleum sector.

He said government was encouraging and facilitating the investors in oil and gas sector and providing them attractive package of incentives in a level playing field.

He said that there existed a lot of scope and opportunities for the investors in the oil and gas sector and invited the Chinese company to participate in the upcoming projects for the mutual advantage.

During the meeting, Zhang Benquen briefed the Minister about the profile of his company being the largest Construction and Engineering Company of China involved in the oil and gas activities across the world.

He informed that his company has 120 rigs and was already cooperating with OGDCL in the drilling activities by providing them four rigs.

He said that one more rig has also arrived in Pakistan, which would help boost the exploration activities.

Zhang Benquen greatly appreciated the GDP growth in Pakistan in last few years and expressed the desire of Sichuan Petroleum to invest in the upcoming mega projects in the oil and gas sector for the benefit of the two countries.

Senior Joint Secretary (Development) Jahangir Khan, General Manager, OGDCL Aftab Ahmed and Chief Executive Officer of Petroleum Exploration Limited Zaheeruddin were also present during the meeting.

 

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SADIQABAD (April 29 2006): Prime Minister Shaukat Aziz on Friday performed the ground-breaking of the $475 million Fatima Fertiliser plant, and expressed hope that more investment would come from the private sector to meet the growing demand of fertilisers in the country.

He said that there was increasing demand of fertilisers in the country in the wake of impressive growth in the agriculture sector.

He said the government was taking steps to ensure water and food security.

The Prime Minister said that development of agriculture sector "remains the focus" of government efforts as it is the backbone and main driving force behind the economic progress.

The agriculture sector contributes 25 percent of the country's Gross Domestic Product (GDP) and employs 42 percent of total labour force.

Emphasising the importance of promoting agriculture sector for poverty alleviation, he said about 65 percent of total population that lives in the rural areas look towards the agriculture sector for sustenance.

The Prime Minister said that development of agriculture sector would lead to overall progress of the country. He expressed hope that establishment of the new fertiliser plant in the private sector would attract more investment in this sector.

He said the government was trying to provide agricultural inputs to farmers at competitive rates that would help them to get better return for their produce.

Shaukat said that there was shortage of fertilisers in the country owing to increasing demand, and expressed hope that with the help of the private sector this demand-supply gap would be bridged.

He said the government has privatised all state-owned fertiliser facilities that had helped to attract more investment in the industry from the private sector.

He noted that Sadiqabad is a cotton growing area and setting up of a fertiliser plant here would help improve its crop and increase production of cotton.

Describing the $475 million investment in the project, he said it was part of foreign direct investment, which is likely to exceed 3 billion dollars mark this year owing to the government's economic policies.

He said the broad-based structural reforms, good governance and the policies of liberalisation, privatisation and de-regulation had enabled the country to post 8.4 percent GDP growth last year.

The Prime Minister expressed confidence 6 to 8 percent growth would be maintained by ensuring continuity and consistency in government policies. He said that Pakistan was negotiating import of gas from various countries in the wake of expanding economy and increasing demand of energy in the industrial sector.

He appreciated that the plant would be built in a way as to make it environment-friendly.

Minister of Food and Agriculture Sikandar Hayat Bosan gave an overview of the policies in the agriculture sector, which he said, "remains the main source" of livelihood for over 65 percent of the total population.

He said the government was also encouraging modern ideas and techniques and supporting training for farmers to increase agriculture yield. Minister of State for Environment Amin Aslam Khan and President of Fatima Fertiliser, Arif Habib, also spoke on the occasion.

 

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ISLAMABAD (April 29 2006): Pakistan has decided to procure 45 more locomotives, of different horse powers, from China, as Dongfang Electric Corporation, the Chinese company, has expressed willingness to redesign the already delivered 30 faulty locomotives.

"We are procuring 45 more locomotives, of 2000 and 3000 HP, with strengthened under-frame and extended warranty of five years," Secretary, Railways, Shakil Durrani, told Business Recorder.

Earlier the government had decided to take up the issue with the Chinese company for modification of the locomotives under the guarantee and, in case the firm refused to reconsider the design, to consult an international lawyer to take the case to International Chamber of Commerce (ICC).

However, a committee constituted, under the chairmanship of Planning Commission Deputy Chairman Dr Akram Shaikh, and comprising Secretaries of Finance and Railways, recommended for redesigning of the 3000 HP locomotives to bring the weight down from 140 tons to 132 tons to sustain the permissible speed and the infrastructure.

In accordance with the decision of the committee, the supplier/manufacturer was approached to redesign the locomotives, reducing their weight from 140 to 132 tons.

However, the technical delegation of the Chinese firm, during its visit to Pakistan in the third week of February this year, confirmed to re-examine the design to reduce the axle load, but added that the weight could be reduced from 140 to 137.16 tons, which is permissible on Pakistan Railways.

An official said that the Chinese service engineers, after examination of the 'faulty' engines, observed that the faults could be removed under warrantee clause of the agreement.

The official said that the Railways Ministry had recently submitted two options to the government to resolve the issue, which were as follows:

1) The remaining 20 locomotives, of 3000 HP not yet delivered to Pakistan Railways, be procured according to the existing contract with strengthened under-frame and extended guarantee of five years. The weight of new locomotives should be reduced from 140 to 132 tons, preferably, or at least to Pakistan Railways permissible load.

2) No additional 3000 HP locomotives be procured and, instead, the number of 2000 HP locomotives be increased from 25, as per agreement, to 46 in the revised agreement.

The official said that the government has allowed the Ministry to procure 45 more engines (of 2000 and 3000 HP)--with modifications.

 

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RAWALPINDI (April 29 2006): Rawalpindi Chamber of Commerce and Industry (RCCI) President Jalil Ahmad Malik has said that Pakistan and Thailand were enjoying cordial relations but the trade volume of dollars 332.47 million was insufficient.

"Trade volume of dollars 332.47 million is mere a peanut and business communities of two sides must speed up efforts to increase it manifold to benefit their people", Malik said while addressing the meeting of RCCI members with Thai Business Center Dhaka Minister Counsellor (Commercial) Kanyarat Vongskul here on Friday.

He stressed the need of co-operation between two sides saying that both countries were emerging as future economic powers and business communities of two sides should explore avenues of co-operation in trade and economic activities.

The Thai Business Center Dhaka Counsellor (Commercial) Kanyarat Vongskul said economic and trade relations had attained central place in world politics.

 

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HANNOVER (April 29 2006): The Hannover Fair 2006 came to a resounding close on Friday, April 28, 2006, with Pakistani exhibitors expressing complete satisfaction over their participation. Numerous companies bagged business orders, and availed opportunities from European markets. Total 60 Pakistani exhibitors took part in the fair held here from April 24-28, 2006.

Being better prepared to do business in the international market this year, Pakistan's exhibitors displayed maturity and professional acumen, which resulted in the companies securing business orders and opportunities from Germany and other European countries.

Imtiaz A Rastgar, Vice-Chairman and CEO, Engineering Development Board (EDB), commenting on the success of Pakistan's exhibitors, said, "The engineering sector in Pakistan has proven that, given the opportunity, Pakistani companies can compete in the international markets and become part of the global supply chain.

We met Presidents of various world famous companies in the European Union, including the President of the Federation of German Industries, and have signed MOUs for technical agreements, joint ventures and technical collaborations."

Rumi Moiz, Managing Director, Research & Development Engineering Company, manufacturer of precision engineering parts in Pakistan, said the company was overwhelmed with the response it received this year. "It has been a dream come true. The company that we have been benchmarking since last tear to emulate came to us to do business with our company! We are also moving on to Holland to continue negotiations with three others companies and sign an MOU with one of them."

Farhan Junejo, Pakistan's Commercial Counsellor in Germany, said that the Pakistan delegation made a positive impact at the Hannover Messe 2006. "With this rate of success, there should be no looking back. We have to sustain our presence here and continue to take part progressively so that Pakistan's industry gets its deserved recognition in the engineering sector. I was happy to be part of the team that did an excellent job with the arrangements at the Pakistan pavilion."

Pakistan's leading manufacturers of CNG dispensing machines, Tesla Industries' Aamir Hussain said, "We, too, have received very good response from international companies.

It is quite visible that international organisations and European companies are beginning to recognise the potential for outsourcing engineering manufactured components, parts and equipment to Pakistani companies."

Nabeel Hashmi, Chairman of Business Development Group (BDG), in his closing remarks to the exhibitors at the final debriefing, said, "I would like to congratulate each and every exhibitor, as well as delegates, for projecting an excellent image of Pakistan here in Germany. We made a positive impact in the international business community and were able to secure substantial business orders and enquiries.

"Hannover is not a one-time attempt; we have to be here for years to make a difference; we have made a start and, Insha 'Allah, we will be one of the leading industrialised nations of the world in the near future. I would also like to thank all members of the organising committee for their hard work and sincere efforts."

The main Pakistan Pavilion made an overwhelming impact in the 'Subcontracting Hall'. Pakistani exhibitors were also present in the Power Generation and Factory Automation halls. Visitors poured in large numbers and conducted business in a professional environment.

They appreciated the hospitality of the Pakistani team at the pavilion.

Pakistan participated at the Hannover Messe 2006 with a delegation of 220 people from the engineering sector, including some members of academia and media. Led by Jahangir Khan Tareen, Minister for Industries, Production & Special Initiatives, Imtiaz Rastgar, Vice Chairman and CEO, Engineering Development Board (EDB), and Nabeel Hashmi, Chairman of the Business Development Group (BDG-EDB), the Pakistan delegation had several bilateral and joint venture partnership meetings with counterparts in Germany and from various international companies.-PR

 

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By Mubarak Zeb Khan

ISLAMABAD, April 28: Pakistan’s exports of non-textile products rose by 17.6 per cent to $4.871 billion during nine months (July-March) of the current fiscal year as against $4.142 billion in the same period last year.

Official figures showed that the growth was mainly due to over 22 per cent increase in export of primary commodities during the period under review.

The statistics showed that the export of rice rose by 33.68 per cent to $835.199 million as against $624.952 million in the corresponding period last year. Of these, the export of basmati rise rose by 24.20 per cent.

Among the primary commodities, exports of fish and fish foods increased by 30.20 per cent, fruits 20.64 per cent, vegetables 20.02 per cent and spices by 68.57 per cent. However, exports of raw cotton declined by 44.29 per cent, tobacco 37.05 per cent and oil seeds, nuts and kernals by 56.30 per cent.

Exports of surgical goods and medicinal instruments also declined by 14.06 per cent, jewellery 40.94 per cent, furniture 10.04 per cent and molasses by 48.65 per cent during the July-March period.

The export of engineering goods has increased by 10.29 per cent to $135.368 million as against $122.759 million in the same period last year. Of these, exports of electric fans declined by 2.24 per cent and transport equipment by 29.99 per cent. However, exports of other electrical machinery increased by 11.23 per cent, auto parts 55.79 per cent and machinery for specialized industries by 36.96 per cent.

The export of sports goods increased by 5.68 per cent to $228.364 million during the period under review as against $216.090 million in the same period last year. Of these, the export of footballs rose by 23.74 per cent. However, the export of gloves declined by 52.20 per cent.

The export of footwear products increased by 7.44 per cent to $95.064 million during the July-March period of the current fiscal year as against $88.480 million in the same period last year. Of these, the export of leather footwear increased by 14.44 per cent. However, exports of canvas footwear declined by 43.72 per cent and other footwear by 13.18 per cent.

The export of leather products increased by 44.04 per cent to $540.548 million during the period under review as against $375.271m in the same period of last year. Of these, exports of leather garments rose by 58.48 per cent and other leather products by 160.33 per cent. However, the export of leather gloves declined by 5.06 per cent.

The statistics showed that exports of carpets, rugs and mats increased by 0.83 per cent, gems 21.02 per cent, cutlery 8.44pc, onyx-manufactured 41.09pc and chemical and pharmaceutical products by 6.05 per cent.