Pakistan Economy - News & Updates - Archive

[Introvert]

July-May textile exports reach $9.816 billion
ZAHEER ABBASI
ISLAMABAD (June 23 2007): Export of textile products reached 9.816 billion dollars mark in the first 11 months (July-May) of the current fiscal, up 6.04 percent from 9.257 billion dollars over the same period last year while the country's food import bill touched 2.537 billion dollars during the period.

Official figures released by the Federal Bureau of Statistics (FBS) on Friday showed that export of almost all the products, excluding raw cotton, cotton cloth and bedwear recorded growth during the period under review over the last year. On monthly basis the export of textile products witnessed growth of 4.84 percent to 950.821 million dollars during the month of May as against 906.944 million dollars during the same month last year.

Detailed analysis of the commodities showed that export of readymade garments witnessed a growth of 5.35 percent to 1.254 billion dollars during the July-May period against 1.190 billion dollars over the same period last year. A growth of 6.16 percent in export of readymade garments was recorded in the month of May over the same month last year.

Statistics showed that the export of knitwear also recorded a growth of 12.94 percent during July-May to 1.773 billion dollars as against 1.570 billion dollars last year. A growth of 4.12 percent in export knitwear was recorded in the month of May over the same month last year.

Export of raw cotton, cotton cloth and bed wear recorded a negative growth by 21.73 percent, 410 percent and 3.10 percent, respectively, during July-May over the period last year.

Export of cotton yarn was up by 4.21 percent, cotton carded or combed 3.92 percent, yarn other than cotton yarn 82.59 percent, towels 2.43 percent, tents, canvas and tarpaulin 99.06 percent, art, silk and synthetic textile 122.12 percent, made-up articles 13.45 percent and other textile materials 17.42 percent during the period under review over last year. Meanwhile, food import bill jumped 2.537 billion dollars during the 11 month of current fiscal, up by 1.75 percent from 2.494 billion dollars over the same period last year.

Among food items, import of milk cream and milk food for infant witnessed an increase of 31.01 percent, dry fruit and nuts 19.15 percent, spices 3.20 percent, soyabean oil 75.56 percent, palm oil 26.13 percent, pulses 54.83 percent, and all other items 7.33 percent during the period under review.
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[Introvert]

Portfolio investment hits record $906.774 million
RECORDER REPORT
KARACHI (June 23 2007): Portfolio investment in the country's equity market has for the first time crossed the $900 million mark to reach $906.774 million on June 22, 2007. Analysts say that continuous inflow of portfolio investment in local equity market shows increasing interest of foreign investors to invest here and it is also their trust in this fast growing economy.

According to the figures released by the State Bank of Pakistan, total portfolio investment as represented by Special Convertible Rupee Accounts (SCRAs) reached $906,774,748 on June 22 due to massive inflow from Hong Kong and UK.

Massive inflow of portfolio investment was witnessed during the current month as $151.280 million in this account came from June 01 to June 22, 2007, while $39.737 million increase in SCRAs balances was witnessed in last three days, and $7.083,644 came only on June 21, 2007.

The recent increase from Hong Kong and UK on June 21 was $3,521,099 and $9,089,045 respectively. However, their was a net outflow of $5,305,288 by investors of USA on the same date.

From June 1 to June 21, the investment from USA was at the top at $97,422,695, followed by UK $66,036,721, Japan $6,823,239, Hong Kong $4,553,643, France $2,553,782 and Qatar $34,951. On the other hand, the outflow of $13,909,797 was registered by Switzerland investors, $1,065,136 by UAE, $5,613,792 by Singapore, $135,318 by B V Island, $59,258 by Luxembourg and $14,701 by Germany.

In overall position, from July 1, 2006 till date, US investors were at top as their investment reached $680,822,387, followed by UK $202,282,733. The investment from Netherlands reached $44,124,443, Hong Kong $31,340,071, Kuwait $14,176,417, Singapore $7,245,229, Germany $7,111,896, Japan $7,074,298, France $376,040, Bahrain $127,018, Qatar $14,926 and Oman $2,823.

The outflow of SCRA balances from July 1, 2006 till date (June 21, 2007) was $72,373,368 by Switzerland, $6,916,235 by Australia, $1,852,249 by B V Island, $3,224,050 by UAE, $1,073,665 by Luxembourg, $781,330 by Bahamas, $497,210 by Malaysia, $468,835 by Guernsey, $423,696 by Saudi Arabia, $261,493 Liberia,$51,401 by Denmark.

Muhammad Sohail, a leading analyst and Director Equity Broking, JS Global Capital, said that there was a massive flow of liquidity in the world and the investors from all over the globe were now investing in the emerging markets in the world. Pakistan is one of emerging markets in the region with its GDP growth of 7 percent, which is attracting more foreign investment in equity market. He said that India and Vietnam are the other two emerging markets in this region.
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[Neo]

One-dollar shop programme: export order from US increased ​

LAHORE (June 22 2007): The response of 'One Dollar Shop Programme' is very positive and the export order from USA has been increased up to Rs 500 million so far. Provincial Minister for Industries, Muhammad Ajmal Cheema said this while talking to a delegation at his office here on Thursday, according to a hand out.

The minister said that a number of industrialists have shown interest in 'One Dollar Shop Programme', therefore, the sphere of the programme will be broadened soon. He said that more seminars are being organised for awareness of this programme, in which investors will be provided necessary information about the utility of this programme and manufacturing of various export items.

He informed that exhibition regarding 'One Dollar Shop Programme' will be arranged at Lahore Chamber of Commerce and Industry where new items will be displayed for the interest of foreign investors.

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[Neo]

Pak-US trade ties expanding: Hunt ​

LAHORE (June 22 2007): Principal Officer of the US Consulate Lahore, Bryan D Hunt on Thursday said that trade between Pakistan and USA was on the rising trend and had surged by 40 percent.

While addressing the business community at the zonal office of the Federation of Pakistan Chamber of Commence and Industry (FPCCI), he said that exports to USA from special industrial zone being set up in Pakistan would further help increase exports to the USA.

The USA is not only investing in the special zone but also spending billions of dollars in health, education, and earthquake relief. Export of fruit is also being actively considered and hopefully, the mango exports to the USA would commence from the year 2008.

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[Neo]

German firm wins diesel power plants contract ​

FRANKFURT (June 23 2007): MAN, the German engineering conglomerate, said on Thursday that its subsidiary, MAN Diesel, had signed a deal with Pakistani Atlas Group to build diesel power plants in Pakistan.

The co-operation agreement "covers the development, design, construction and maintenance of four turnkey diesel power plants from 120 to 225 megawatt in size, to be completed by 2012," said MAN Diesel chief Georg Pachta-Reyhofen.

The four power plants were all to be built in the north of Pakistan, near the city of Lahore, with the first plant to come into operation in Sheikhupura in March 2009. MAN Diesel would supply the engines for the plant and the contract also included operation and maintenance of the plant for 10 years. "The order volume for this first stage is about 200 million euros" (268 million dollars), MAN said.

Under the terms of the partnership, MAN Diesel would be responsible for the construction and operation, while the Atlas Group would "configure economic and financial aspects," it said.

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[Neo]

14,455 schemes completed under KPP ​

ISLAMABAD (June 23 2007): Minister for local bodies and rural development former Justice Abdul Razzaq Taheem said 14,455 schemes have been completed across the country from 2002 to 2007 under Khushal Pakistan Programme (KPP) in addition to normal development schemes carried out by various departments.

Talking to PTV, he said a sum of Rs 12,104 million has been released for a total of 23,836 schemes recommended by MNAs under KPP-1. The main focus of schemes under KPP was aimed at providing basic amenities to the countrymen and bringing at par the far-flung areas with country's developed areas. The grants accorded to various senators and MNAs for development schemes for the year 2006-2007 amounted to Rs 10 million per head.

No discrimination was observed between the ruling party and opposition members in the allocation process. The schemes presented by members are carefully scrutinised and are evaluated by relevant departments and organisations, he informed.

The minister denied any delay in the disbursement of funds and said that no case of embezzlement regarding these funds had ever been reported nor any case of corruption been filed against any district nazim. Strict vigilance of the schemes have been ensured aiming to avoid squandering of public money. Monitoring teams have recently been constituted. It has also been ensured that projects are completed on time.

Extra-ordinary development schemes have been completed in the country during the last four years. Various departments were busy in executing the infrastructure development projects including district, provincial, federal governments and MPs funds, he said. District government system was working very effectively. Bureaucracy has been placed under the district government.

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[Neo]

Pakistan's economic growth one of best in world: Musharraf ​

LAHORE (June 23 2007): Economic growth in the country is rated as one of the best in the world, while the government is spending huge funds on improving infrastructure including railways, roads, airports and seaports. This was stated by President General Pervez Musharraf while addressing the officers of Lahore Garrison at the Corps Headquarters Auditorium here on Friday.

President Musharraf said a strategy has been evolved to improve quality of life of the common man with a focus on health, education, poverty alleviation and employment. He further said the armed forces of Pakistan are symbol of national integration and progress and prosperity of the country depends on integrity, unity and harmony of this vital institution.

He said he was a firm believer in peace through strength. "Irrespective of our country's peace initiatives to encourage stability in the region, we are fully conscious of our security needs and are making all out efforts to maintain impregnable defence of the country", he said, adding, "we do not foster any offensive designs against any country but induction of latest arms and equipment in the armed forces was our right." President Musharraf said Pakistan has a tremendous potential to rise as a progressive and moderate Islamic country among the comity of nations.

He warned that obscurantists and extremist elements are the major impediment in the way of achieving economic progress and development. He urged moderate forces to join hands with him and reiterated his pledge to fight these anti-state forces with an iron hand to lead the country towards a brighter future.

He further said that Islam believes in tolerance and brotherhood, but unfortunately, obscurantists were undermining the basic ingredients of this great religion by interpreting it to serve their nefarious designs. Criticising rumourmongers, Musharraf said they were responsible for despondency among the public to fulfil their self-serving agenda. He advised such elements to act with responsibility, as the country was passing through the most crucial phase of its history. 'Pakistan has come to stay and God willing we shall persevere and succeed to rise in the comity of nations', he said.

Talking about the efforts to curb security threats within the country, the President said efforts were being made to ensure consolidation and reorganisation of the paramilitary forces. He said that more emphasis was being laid to equip them with better weapons and extensive training to control militancy in the tribal areas of NWFP.

President Musharraf said a strategy has been evolved to improve quality of life of the common man with a focus on health, education, poverty alleviation and employment. He also mentioned the Lahore Corps for doing a great national service by establishing a polytechnic institute for imparting technical education to unskilled labour of the country.

The session that lasted for two hours was attended by over 500 officers from Army, Navy and Air Force stationed at Lahore. The President took questions from the officers after his address. Apart from a large number of officers of Lahore Garrison, prominent among those who attended included Corps Commander Lieutenant General Shafaat Ullah Shah, General Officers Commanding, Major General Shaukat Sultan Khan, Major General Raheel Sharif, Director General Pakistan Rangers Punjab Major General Hussain Mehdi and Director General NAB Lahore Major General Qasim Qureshi.

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National Assembly approves amended Finance Bill 2007-08: Rs 1.874 trillion budget passed ​

ISLAMABAD (June 23 2007): The National Assembly has approved amended Finance Bill (2007-2008) for conversion of Central Board of Revenue (CBR) into Federal Board of Revenue (FBR), levy of one percent special excise duty on import and local manufacturing, tax relief to retailers, further incentives under group relief and extended powers to the CBR to change withholding tax rates without consulting parliament or federal government.

Minister of State for Finance and Revenue Omar Ayub Khan on Friday approved the amendments in the Finance Bill submitted by the Central Board of Revenue (CBR). One of the major powers obtained by the CBR through amended Finance Bill is the rationalisation of withholding tax rates on its own. There is no need to obtain prior approval of the federal government or parliament for this purpose.

The CBR has also amended the Seventh Schedule (banking schedule) for the computation of profits and gains of a banking company. The government has also announced another big relief to the traders operating under section 113-B of the Income Tax Ordinance 2001. Under section 113-B (taxation of income of certain retailers), traders have been allowed to pay reduced rates of turnover tax retrospectively ie from ''tax year 2007'' instead of tax year 2008. Thus, 50 percent reduction in combined sales tax/income tax would be available to traders, whose turnover exceeds Rs five million.

The government has also empowered the commissioner of income tax (CIT) to call income tax statements from the taxpayers for the last five years in cases of ''final discharge of tax liability''. Previously, commissioners could only call income tax returns for the last five years.

Through another amendment cleared by National Assembly, the importer-cum-manufacturers, declaring losses, have to pay 0.5 percent income tax at the import stage. Earlier, the importers-cum-manufactures were given 100 percent exemption certificates.

In cases of losses, exemption certificates would be given at the reduced tax rates and they have to pay 0.5 percent tax at the import stage for obtaining these certificates. The importer-cum-manufacturers are bound to submit the minimum tax at the rate of 0.5 percent of the turnover, which would now be collected at the import stage.

According to another amendment, the option of group taxation shall be available to those group companies which comply with such corporate governance requirements as may be specified by the Securities and Exchange Commission of Pakistan (SECP) form time to time and are designated as companies entitled to avail group taxation.

As per revised section 59B the government has offered more incentives under the concept of group relief. The National Assembly has approved that any company, being a subsidiary or a holding company, may surrender its assessed loss (excluding capital loss) for the tax year (other than brought forward losses and capital losses), in favour of its holding company or its subsidiary or between another subsidiary of the holding company.

Provided that where one of the company in the group is a public company listed on a registered stock exchange in Pakistan, the holding company shall directly hold 55 percent or more of the share capital of the subsidiary company. Where none of the companies in the group is a listed company, the holding company shall hold directly 75 percent or more of the share capital of the subsidiary company.

A company within the group engaged in the business of trading shall not be entitled to avail group relief. All the companies in the group shall comply with such corporate governance requirements as may be specified by the Securities and Exchange Commission of Pakistan from time to time, and are designated as companies entitled to avail group relief, the amended Finance Bill said.

The commissioner may, by notice in writing, require any person who, in his opinion, is required to file a prescribed statement for a tax year but who has failed to do so, to furnish a prescribed statement for that year within 30 days from the date of serving of such notice or such longer period as may be specified in such notice or as he may allow.

Through another amendment, a person may be appointed as an accountant member of the appellate tribunal if the person is an officer of the income tax group equivalent in rank to that of a regional commissioner and the commissioner of income tax or commissioner of income tax (Appeals) having at least five years experience as commissioner shall also be eligible for appointment.

The amended Finance Bill has further specified that the income tax exemption (section 49) would not be available in the case of a corporation, company, a regulatory authority, a development authority or other body or institution established by or under a federal law or a provincial law or an existing law or a corporation, company or other body or institution set up, owned and controlled, either directly or indirectly, by the federal government or a provincial government, regardless of the ultimate destination of such income, as laid down in Article 165A of the Constitution of the Islamic Republic of Pakistan.

In the case of a person whose income is not subject to final taxation, the commissioner is satisfied that such person is not likely to pay any tax (other than tax under section 113), the commissioner shall, upon application in writing made by such person, issue certificate allowing payment of tax collectable under this section at a reduced rate of 0.5 percent.

Through another amendment in the Seventh Schedule (banking schedule) of the Income Tax Ordinance 2001, loss on sale of shares of listed companies, disposed of within one year of the date of acquisition, shall be adjustable against business income of the tax year. Where such loss is not fully set off against business income during the tax year, it shall be carried forward to the following tax year and set off against capital gain only. No loss shall be carried forward for more than six years immediately succeeding the tax year for which the loss was first computed.

On the sales tax side, the National Assembly has approved various amendments in the Sales Tax Act, 1990. The federal government may specify any person or class of persons as withholding agents for deduction and deposit of tax at the specified rate.

Where there is reason to believe that a person has claimed input tax credit or refund, which was not admissible to him, the proceedings against him shall be completed within 60 days. For inquiry or audit or investigation regarding admissibility of the refund claim, the period of 60 days may be extended up to 120 days by an officer not below the rank of an additional collector of sales tax and the board may, for reasons to be recorded in written, extend the period which shall in no case exceed nine months.

BUDGET PASSED: The National Assembly also passed Rs 1.874 trillion budget for next fiscal year, turning down opposition''s request to raise salaries of government employees by 20 percent. The government made nearly eight amendments in the Finance Bill 2007 whereas at least 20 amendments moved by the opposition were turned down.

The government also incorporated 51 out of 90 recommendations in the money bill forwarded by the Upper House of parliament. Opposition members of NA body on finance strongly protested on the passage of the Finance Bill, and, as usual, walked out of the house against what they said was an unconstitutional piece of legislation.

Prime Minister Shaukat Aziz attended most of the daylong proceedings and remained busy in ''brief'' meetings with treasury members. Earlier, taking part in the debate, opposition benches said the bill was drafted merely to appease two classes-bankers and stockbrokers.

The government was accused of bypassing both National Assembly and Senate in the entire budget-making process. Opposition members said money laundering bill had been made part of the Finance Bill unconstitutionally knowing the fact that it was still under consideration by the NA body on finance and revenue.

They termed government''s decision to establish Federal Board of Revenue, changing in the preambles of Securities Exchange Commission of Pakistan (SECP) Act, Customs Act and Banking Companies Ordinance "sheer violation" of the constitution.

They opposition members of NA standing committee on finance and revenue said some controversial changes were made in the money bill through backdoor channels.

They strongly opposed the ''unlimited'' discretionary powers being delegated to Board members of the Federal Board of Revenue. Strong protest was also lodged against the ''unlimited'' extensions in the tenure of National Bank of Pakistan and Khushhali Bank of Pakistan presidents.

PPP-P''s Naveed Qamar and Naheed Khan pointed out that Advisor to Prime Minister on Finance Salman Shah was being made Chairman of Securities and Exchange Commission of Pakistan.

The opposition pressed the government through its amendments that salaries of government employees should be raised by up to 20 percent besides increase in the minimum wage to Rs 6,000. However, the government voted out the opposition''s proposed amendment. The house will now meet on Saturday at 1000 hours to take up supplementary grants for different ministries and departments during the year 2006-07.

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MTDF envisages creation of 50.12 million jobs by 2009-10 ​

ISLAMABAD (June 22 2007): The Medium Term Development Framework (MTDF) 2010 has envisaged the need for the creation of 50.12 million jobs by 2009-10 to meet the set MTDF targets, sources said.

As women constitute 48.8 percent of the population and the rate of female labour has increased from 1.2 percent to 13.3 percent previous years and their unemployment rate has fallen from 12.8 percent to 9.3 percent in the previous fiscal year, which shows substantial decrease of 3.5 points, the government failed to provide education, training and skill development opportunities to women, source said.

The allocation for employment during the previous fiscal year was Rs 1, 136.8 million in PSDP that is higher than the budgetary allocation of the current fiscal, they said. In view of envisaged GDP growth and enhanced PSDP allocations, the target is easily achievable with 4 percent decline in the rate of unemployment. Moreover, reforms and expansions of vocational and technical training will further enhance productivity of the employed labour force, the sources said.

Giving the details of the allocations the sources said that Rs 198.4 million has been allocated in the PSDP 2007-08 for 14 projects including new initiatives and some of the ongoing employment generating projects that would also continue in fiscal 2007-08. Said.

Moreover, Rs 12.3 million for training of Trainers, Rs 9.1 million for Skill Development Labour Market Requirement and Analysis System, Rs 14 million for Policy Planning Cell and Rs 25.3 million for Computerising of the Data of Outgoing Emigrants and Returning Migrants have been allocated in the fiscal 2007-08, they said.

'Labour Market Information and Analysis' project intend to develop an institutional mechanism that will monitor and report labour markets developments at district, provincial and national levels, they said. They also said that one of the initiatives to expand employment specifically among the youth was launched by 'President Rozgar Scheme' in collaboration with National Bank of Pakistan.

This scheme deals with various areas of concerns such as transport, utility stores under Utility Supply Corporation (USC), mobile utility stores, mobile general store, NBP Karobar PCO and NBP tele-centre. During the fiscal Rs 1.3 billion are to be disbursed to around 21,500 beneficiaries, they said.

The government's strategy is to generate employment by imparting technical and vocational training through capacity building of existing and potential skilled and unskilled workers in the field of horticulture and gardening.

Keeping this in view the National Training Bureau has planned to launch three months gardener certificate course under the project titled 'Green Man,' sources said.

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Government may fetch $2 billion from privatisation proceeds in fiscal year 2008: National Assembly informed ​

ISLAMABAD (June 22 2007): The government expects to fetch 2 billion dollar from privatisation proceeds in next fiscal, Privatisation Minister Zahid Hamid told the National Assembly on Thursday amid opposition's serious reservations about transparency in country's privatisation policy.

The opposition staged a token walkout to protest against the lack of transparency in the privatisation proceeds. Defending opposition's seething criticism, Zahid said the government has so far succeeded earning more than 6 billion dollar through 64 transactions out of which 18 were profit-making entities.

He said around 1 billion dollar foreign investment has come in 11 months this year through privatisation proceeds, as it was the most successful year in terms of privatisation. The minister went on saying that the past governments could earn Rs 158 billion only from privatisation of 102 entities between 1991 and 1999.

Meanwhile, the opposition parties moved some 122 cut motions against Privatisation Commission's demands for grants for next fiscal year and expressed serious concerns regarding the government's privatisation policy.

The opposition protested against the proposed privatisation of Pakistan State Oil (PSO), Pakistan International Airlines (PIA), Pakistan Railways and other vital entities.

The opposition lawmakers said that post-KESC privatisation situation should be an eye-opener for the rulers. Similarly, they said the Supreme Court judgement against the privatisation of Pakistan Steel Mills has exposed the transparency in the government's policy.

They took the government to task over privatising the Pakistan Telecommunication Company Limited (PTCL) and Habib Bank Limited (HBL) at throwaway prices.

Questioning the government's credibility, the opposition members said neither the amount coming through privatisation proceeds was being used to retire foreign debts nor a single penny was being spent to control poverty.

PPP-P legislator Manzoor Wassan demanded of the government to form a seven-member committee headed by a senior Supreme Court judge to ensure transparency in the privatisation policy.

The opposition called for re-nationalisation of Karachi Electric Supply Corporation (KESC) and Pakistan Telecommunication Company Limited (PTCL) and pressed the government not to sell profit-making entities.

However, the government voted out 122 cut motions moved by the opposition against Privatisation Commission's demands for grants for next fiscal.

As many as 668 cut motions were moved by the opposition against demands for grants of interior, religious affairs and water and power ministries but all of them were turned down.

The government pushed through the National Assembly demands and grants amounting to more than Rs 90 billion for four ministries-interior, privatisation, religious affairs and water and power.

The demands and grants for water and power ministry were also opposed on the grounds that the government has neither resolved the problem of water shortage nor the lingering power crisis.

May 12 Karachi carnage once again echoed in the House, as the opposition parties voiced for cut in the interior ministry's budget against countrywide worsening law and order situation.

Muhammad Hussain Mehnati of Muttahida Majlis-i-Amal urged the government to withdraw rangers deployed in Karachi, as it miserably failed to protect innocent citizens on May 12.

The opposition also grilled the Religious Affairs Minister Ijazul Haq and demanded his removal over embezzlements in Haj operations.

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[Neo]

Pakistan placed 100th on political and regulatory environment ​

ISLAMABAD (June 22 2007): The Global Information Technology Report (GITR) 2006-07 of the World Economic Forum (WEF) shows how Pakistan's economy is performing and becoming stronger with each passing day, or the case is otherwise.

Networked Readiness Index (NRI) shows where Pakistan stands among 122 countries on key economic issues. The detailed performance of the government is given on year to year basis and it gives fairly a true picture of various sectors of economy.

THESE ARE: ENVIRONMENT COMPONENT:

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Market environment 67
Venture capital availability, 2006 61
Financial market sophistication, 2006 53
Technological readiness, 2006 77
State of cluster development, 2006 55
US utility patents, 2005 78
High-tech exports 63
Burden of government regulation, 2006 54
Extent and effect of taxation, 2006 33
Time required to start a business, 2006 38
No of procedures required to start a business, 2006 79
Intensity of local competition, 2006 73
Freedom of the press, 2006 84
Political and regulatory environment 100
Effectiveness of law-making bodies, 2006 59
Laws relating to ICT, 2006 65
Judicial independence, 2006 79
Intellectual property protection, 2006 79
Efficiency of legal framework, 2006 89
Property rights, 2006 93
Quality of competition in the ISP sector, 2006 36
No of procedures to enforce a contract, 2006 113
Time to enforce a contract, 2006 106
Infrastructure environment 102
Telephone lines, 2005 100
Secure Internet servers, 2005 101
Internet hosts, 2004 94
Electricity production, 2003 91
Availability of scientists and engineers, 2006 78
Quality of scientific research institutions, 2006 62
Tertiary enrolment, 2004 104
Readiness component 83
Individual readiness 94
Quality of match and science education, 2006 85
Quality of the educational system, 2006 73
Quality of public schools, 2006 78
Internet access in schools, 2006 51
Buyer sophistication, 2006 67
Residential telephone connection charge, 2005 58
Residential monthly telephone subscription, 2005 89
High-speed monthly broadband subscription, 2006 96
Lowest cost of broadband, 2006 100
Cost of mobile telephone call, 2005 64
Business readiness 64
Extent of staff training, 2006 90
Local availability of research and training, 2006 83
Quality of management schools, 2006 71
Company spending on R&D, 2006 51
University-industry research collaboration, 2006 61
Business telephone connection charge, 2005 51
Business monthly telephone subscription, 2005 73
Local supplier quality, 2006 66
Computer, comm, and other services imports, 2004 43
Government readiness 80
Government prioritisation of ICT, 2006 62
Govt procurement of advanced tech products, 2006 47
Importance of ICT to gov't. vision of the future, 2006 53
E-participation index, 2005 62
E-government readiness index, 2005 103
Usage component 79
Individual usage 102
Mobile telephone subscribers, 2005 105
Broadband Internet subscribers, 2005 86
Internet users, 2005 83
Internet bandwidth, 2004 79
Business usage 73
Prevalence of foreign technology licensing, 2006 81
Firm-level technology absorption, 2006 85
Capacity for innovation, 2006 38
Availability of new telephone lines, 2006 89
Availability of mobile telephones, 2006 102
Extent of business internet use, 2006 50
Government usage 63
Government success in ICT promotion, 2006 46
Availability of online services, 2006 59
ICT use and government efficiency, 2006 63
ICT pervasiveness, 2006 84
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'Skilled workforce needed for rapid industrialisation' ​

KARACHI (June 22 2007): Any thinking and people pro-active government needs to make optimum use of its workforce and that needs creation of vocational centres in a society like ours. The demand-supply gap of skilled workforce still persists in our country, said some leading economists.

This year, the government has achieved budgetary targets in some fundamental areas but in some important sectors it has missed the targets. This was partly because of lack of proper attention and lack of skilled workforce.

If the government takes the matter seriously, the country may not even need to hire highly paid foreign experts, which eventually becomes an extra burden on the national exchequer. The country is faced with both shortages of manpower and skills, creating gap in the key modern technologies. This reduces optimum operation of plants and machinery, they noted.

Many experts and professors in different institutions were of the view that if the government increases the number of vocational centres the poor children will be able to get better jobs. Many parents suggest that during the summer vacation the provincial government should arrange vocational training programmes, which can help the children utilising time in a healthy way.

It was noted that one of the major constraints in achieving rapid industrialisation in the country is lack of skilled workers. A serious constraint has been low productivity level in the country, economists said. Without the development of a big skilled workforce-base it is not possible to compete or to meet global challenges.

An efficient and quality supply-chain is important for local industry which is missing, partly due to insufficient scale of fund and partly due to inferior raw material and also due to lack of skilled workforce. These are the minimum requirement to come anyway near to global competition, increase exports, they said.

The facilities provided by the government are inadequate. In the Annual Development Plan it was admitted that urban industrial centres could not accommodate the expected rise in the industrial and manufacturing activities.

Meanwhile, the widening trade deficit and increasing inflationary pressure may create more difficulties for the government in the next fiscal year. These are also the main challenges that the government must tackle boldly, they said.

The government is importing costly machinery to accelerate the progress of works, although some progress has been made and many products are manufactured locally, but in some sectors, lack of proper certification on quality and safety are hindering wider acceptance of such products both locally and globally.

Strategic planning of manufacturing industry with local skilled work force at least up to middle management level is necessary to meet the objectives of rapid industrialisation in the country, they said.

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Thar coal project hits snags; consultants identify major risks ​

ISLAMABAD: The Thar coal project has hit snags even prior to start of work on it, as the consultant hired by the Asian Development Bank (ADB) have identified major risks and constraints in the extraction of coal, a senior official told The News.

“The consultant said that there is a strong indication that there exists a bed of water even at a depth of 300-400 meters and then too there is no certainty about the presence of coal deposits.”

Dr Michel C Clarke, hired by the ADB as a consultant recently, identified major risks and constraints in mining for Thar coal and indicated that the information available in the previous studies has not resulted in a “bankable” feasibility study on the basis of which the private sector could be engaged for full scale commercial development.

In view of the gaps in the technical data, the consultant has recommended hydrological, technical and environmental studies to be followed by digging of a test-pit to identify mining techniques appropriate for the prevailing conditions in Thar, and to collect bulk samples for testing on a commercial scale for power generation and for coal-to-liquids conversion.

The official, quoting the findings of the ADB consultant, said that a bankable feasibility report could be produced within two years at an estimated cost of $20-30 million inclusive of the cost of the test-pit, subject to technical and economic feasibility as determined through test-pit effort.

Answering a question, the official said that a 2000-4000 Mw mine-mouth power generation capacity in the first phase of commercial development could be followed by a 50,000 bbl per day coal to liquids project in the later phases. The government has already set up a $500 million Thar Coal Mining Company (TCMC) to be run by the private sector to develop the countryís largest deposits of coal at Thar.

The plan, approved by the president and the prime minister, envisaged unbundling of Thar Coal project into mining and power generation; to bring down the size of investment in each block from $1.5 billion to $500 million.

“We lost seven years in trying to attract large companies to finance up to $1.5 billion in mining and production of electricity from Thar coal reserve but failed to get a breakthrough because such a big investment was not forthcoming,” the official said.

http://www.thenews.com.pk/daily_detail.asp?id=61533

 

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Pakistan's ethanol production likely to decline ​

KARACHI: Pakistan’s fuel-grade ethanol production is expected to decline because of lower global prices, according to a latest US Department of Agriculture AttachÈ report.

Pakistan’s sugar industry operates 21 distillery units, with an annual production capacity of 400,000 tons of ethanol. Most distilleries produce hydrous ethanol. Last year, Pakistan produced and exported 36,500 tons of fuel-grade ethanol, mostly to the United States. During the current year, fuel-grade ethanol production is expected to decline due to lower global prices.

Pakistan exported 165,406 tons of ethanol during 2006 and is projected to export 234,000 tons during the current year.

Pakistan is the world’s seventh-largest sugarcane producer. The crop is grown mainly to produce refined sugar. The sugar industry is the second largest industry in Pakistan after textiles, contributes 2 percent to GDP and 13 percent to the manufacturing sector.

There are 76 sugar mills in the country, with a crushing capacity of 300,000 tons of cane per day. Cane molasses is the main by-product. In order to maximize returns, the sugar industry processes molasses to produce anhydrous and hydrous ethanol. There are 21 distillery units in Pakistan with a capacity to process 2 million tons of molasses to produce 400,000 tons of ethanol.

Petrol consumption in Pakistan during FY 2005-06 totalled 1.6 million tons. Last year, the government approved a pilot project to initiate the sale of petroleum mixed with 10 percent locally-produced ethanol on an experimental basis at three petrol stations in Karachi, Lahore, and Islamabad through the state-run Pakistan State Oil (PSO).

Oil-marketing companies and refineries looked at the initiative with skepticism because it did not result in any saving or cost reduction and required additional investment in sugar plants and post-refining mixing. This is the first time that the concept of ethanol blending with motor gasoline has been considered in Pakistan. The ratio of blended fuel is 10 percent ethanol and 90 percent gasoline.

It will take another year to determine fuel specifications, establish quality control standards, and introduce relevant legislation because de-neutering of alcohol specifications also needs to be determined.

The existing distilleries produce ethanol with 95 percent octane, which needs to be enhanced to 99.7 percent for blending with gasoline. Of the 21 distilleries, only six have the capacity to produce ethanol fit for 10 percent blending and the rest of the units would require an investment of around Rs1.5 million per distillery to upgrade them.

During 2006, these sugar mills manufactured 36,500 tones of fuel-grade ethanol, which was mostly exported to the United States and a limited quantity was used in the local market.

The oil industry needs to establish requisite infrastructure for successful marketing of ethanol and gasoline-ethanol blends. Most of the infrastructure requirements are due to the fact that ethanol is not a part of the existing petroleum system. Neither the oil nor the automobile industry in Pakistan has sufficient knowledge and experience to use ethanol blends in gasoline. They will need a learning phase before the country can venture into nationwide mandatory blend.

The federal government has directed the provinces to allow the sale of blended fuel. Oil-marketing companies are being encouraged to market ethanol as blended fuel because it is cost effective and environmentally friendly.

The ministry of food, agriculture and livestock (MINFAL) has also been directed to explore other sources of raw material for ethanol production such as maize, wheat, rice, potato and sorghum.

Now the 21 distilleries operating in the country has total production capacity of more than 400,000 tons. Most of the distilleries are producing hydrous ethanol, which is 96 percent pure with 4 percent water. In order to convert hydrous ethanol into fuel ethanol, or power ethanol dehydration of up to 99.95 percent purity is required by using suitable technologies. The distilleries are introducing molecular sieve technology.

The production ratio of molasses to ethanol is 5:1, meaning that for producing the existing capacity of ethanol (410,400 tons), the industry would require 2.052 million tons of molasses. However, after the expected addition of four units, ethanol production will rise to 632,400 tons, requiring 3.162 million tons molasses. The projected production of 234,000 tons during the current year (January to December 2007) would require around 1.25-1.3 million tons of molasses. The industry is expected to produce around 234,000 tons in 2007 as compared with 165,405 tons produced in 2006, valued at $100.6 million at an average rate of $570-590 per ton.

Currently, distilleries are operating at 60 percent capacity. Despite the fact that the sugar industry’s profitability has improved after entering into ethanol production, the viability of producing more ethanol depends on world oil prices as it is being used as an alternative fuel to supplement regular POL products. The export of molasses is declining and more than 90 percent production is now being used to produce ethanol. There has been consistent increase in ethanol exports for the past eight years, showing that distilleries are converting larger volumes of molasses into value-added ethanol.

During the past three months, Pakistan has entered into export contracts for around 108,000 tons of ethanol, whereas last year the entire export volume was at 165,406 tons. Exporters are receiving export contract prices in the range of $540-550 per ton of ethanol. Against this, molasses is being quoted at around $61 per ton in the world market. It is expected that higher volumes of ethanol will be produced considering the rising world oil prices.

Being an inflammable commodity, ethanol needs extra care in transportation and storage stages. There are specially built liners with a loading capacity of 3,500-4,000 tons for carrying ethanol. Similarly, extra care has to be taken for storage and tanks have to be segregated by walls as a safety measure in case of fire. Moreover, storage areas need to be fully equipped with fire-fighting equipment to counter fire hazard.

http://www.thenews.com.pk/daily_detail.asp?id=61535

 

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Textile exports grow 6.4pc only ​

KARACHI: The growth of textile exports of the country remained below the expectation of the government as during July-May 2006-07 overall textile exports of the country increased only by 6.04 percent against set target of 15 per cent.

Textile exports during the said period remained $9,816 million against $9257 million recorded in same period of last fiscal year.

The figures issued by Federal Bureau of Statistics (FBS) on Friday revealed that exports of the raw cotton recorded a decline of 21.73 percent to $49 million against $63 million in the same period of fiscal 2005-06. Whereas exports of cotton yarn increased by 4.21 percent to $1,304 millions from $1,251million of last fiscal year, however exports of cotton cloth declined by 4.10 to $1845 million from $1924 millions.

Cotton carded or combed rose by 3.92 percent to $9.7 million against 9.4 millions of last fiscal year.

The substantial increase of 82.59 percent to $61million recorded in export of yarn other than cotton yarn which stood at $33 in preceding period of last fiscal year.

Moreover knitwear exports surged by 12.94 percent to 1,773 million from $1570 millions.

However bed wear exports dropped by 3.10 to $ 1784 million which was recorded $1841million during the same period of last fiscal year.

Export of towel augmented by 2.43 percent to $544 million from $531 million while, exports of Tents canvas & Tarpulin rose by 99.06 percent to $66 million from $33 million during this period.

Exports of readymade garment recorded 5.53 percent increase during first eleven months of outgoing fiscal year. Country’s readymade garments exports were recorded $ 1,254 million, which was $1,190 in the same period of fiscal 2005-06. A commendable122 increase was recorded in the exports of art silk & synthetic textile, which surged to $401 million against $180 million of last fiscal. The exports of made up article excluding towels and bed wear surged by 13 percent to $433 million from $381 million while other textile materials exports rose by 17.42 percent to $287 million from $244 million.

However in the month of May 2007 the textile exports of textile products increased by 4.84 percent only.

During month of May total textile export were recorded to $950 million, which was recorded $906 million in the same month of fiscal 2005-06.

http://www.thenews.com.pk/daily_detail.asp?id=61537