Pakistan Economy - News & Updates - Archive

[Neo]

‘Pakistan has potential to take off’ ​

Sunday, September 09, 2007

LAHORE: Pakistan with a good human resource base has all the potential to become a developed nation, said visiting Singaporean scholar, Dr. Kishore Mahbubani here Saturday.

“By adopting the world’s best practices, Pakistan can takeoff,” he said while delivering a lecture on The New Asian Hemisphere: The Irresistible Shift of Global Power to the East at a local hotel.

Chairman Punjab Planning and Development Board, Suleman Ghani, Former Finance Minister Sartaj Aziz, Rector FC College University, Lahore, Peter Armacost and senior civil officials were present on the occasion.

Dr. Kishore Mahbubani, the Dean of Lee Kuwan Yew School of Public Policy, National University of Singapore said, like overseas Chinese, the Pakistanis Diasporas living in various countries, could contribute to rapid economic development of their homeland.

“It is unnatural for an Asian society not to do well,” he remarked.

He said that the Asian countries by embracing seven pillars of the western wisdom including concept of free market economy, science and technology, meritocracy, pragmatism, culture of peace, rule of law and education, were rapidly catching up with the Western world in terms of economic development.

‘Pakistan has potential to take off’

 

[Neo]

More power generation to meet energy demands​

ISLAMABAD, Sept 8: Prime Minister Shaukat Aziz said on Saturday that additional power generation capacity was being commissioned to meet growing electricity demand in rural and urban areas.

He stated this while talking to Chairman Wapda Shakil Durrani and CEO of Pakistan Electric Power Company (Pepco) Munawar B. Ahmad, who called on him at the PM’s House.

An official announcement issued here said that in order to improve the transmission, distribution and generation of electricity Wapda and Pepco have been separated and hoped that this restructuring will improve the efficiency, create a focused approach and help consumers to get reliable and continuous supply of electricity.

The prime minister said that Wapda was mainly responsible for hydel power generation and water reservoirs while Pepco will look after the transmission, distribution and generation of electricity through other sources.

He emphasised the need to build large dams in the country and said several projects are under consideration in this regard.

Preliminary work on Bhasha Dam, he said, is already underway and Neelum-Jhelum project is also at the advance stage of planning. He said all dams will be built by developing consensus and will help in achieving the increased demand for electricity besides building water reservoirs to meet the need for irrigation.

More power generation to meet energy demands -DAWN - Business; September 09, 2007

 

[Neo]

Malaysian firm to invest in coal power ​

ISLAMABAD, Sept 8: Malaysian Roxwelol Investment Group has shown interest to invest in coal generation and oil shale projects.

Managing Director of the group Dato Dr. Abdullah Hasbi Bin Haji Hassan stated this in a meeting with Minister for Petroleum and Natural Resources Amanullah Khan Jadoon here on Saturday.

During the meeting, the minister told the Malaysian group official that the government was taking concrete steps to exploit the untapped hydrocarbon and coal deposits at a faster pace in order to meet the growing energy needs of the country.

He said that the government has made an ambitious plan to utilise the coal deposit of 175 billion tons in Thar area of Sindh province and generate 20,000MW coal electricity by the year 2016.

He also highlighted the salient features of upcoming oil and gas projects and coal development activities.

The MD of the group expressed the desire to invest in coal generation and oil shale projects.

Malaysian firm to invest in coal power -DAWN - Business; September 09, 2007

 

[Neo]

Technological Favouritism: Foreign software firms elbowing local ones​

KARACHI: Foreign software companies are taking a strong hold of the banking and insurance sectors leaving Pakistani software houses out of competition in specific sectors, industry sources told Daily Times on Saturday.

Giving an example a source said that, even the State Bank of Pakistan has ignored local software companies and has acquired software from a Korean company. Even though the local companies are well capable of making most kinds of financial software.

Sources said that all the existing banks and insurance companies are prefering high priced foreign software companies to develop software for them and not considering the local software companies. Although the banks and insurance companies, who have purchased software that has been developed in other countries, are facing a number of problems in implementing them.

To keep local software companies out of the race, banks and insurance companies put in such requirements in their Requests For Proposals, that local companies just cannot qualify (for instance 100 successful sites where the software is already running) and eliminate them in the fist phase, sources added.

For the survival of the local software companies, government officials have been asked to look into this matter. However, the officials informed them that they are unable to control this situation, as according to WTO rules they cannot put in any protectionist measures.

Pakistan Software Houses Association (P@SHA) says that two things should be kept in mind when companies in Pakistan purchase software: (a) if locally produced software exists that is not only being used by companies in Pakistan but is also being implemented out side the country, then the local software should be preferred; (b) if local software does not meet the requirements, then large national companies, banks, government departments, etc. should ensure that the foreign company uses a local software company for the implementation of the software with 30 percent of the project cost being paid to the local company and transfer of knowledge taking place so that support and maintenance can be carried out by the local company.

There are many companies in Pakistan that have developed cutting edge products for different sectors. Recently PixSense, a local software firm, has developed a cutting edge solution for the telecom sector. This is being used by Telenor, China Mobile, etc. and two US venture capital firms have also invested in this company because they have faith in the product and their business model.

Daily Times - Leading News Resource of Pakistan

 

[Neo]

$20 million confectionary export orders lost in a year​

ISLAMABAD: Pakistan has lost biscuits and confectionary export orders worth $20 million in last one year.

Maqsud Ismail, Chairman Pakistan Biscuit (PBCMEA) and Confectionary Manufacturers and Exporters Association said on Saturday.

He said all of these orders have moved to China and Turkey due to reduced the export rebate given to confectionary industry by Federal Board of Revenue (FBR).

According to Chairman PBCMEA, export rebate has reduced from seven per cent to 0.5 per cent.

“Besides, he said the prices of ingredients used in confectionary items like sugar, glucose, flavors and peper have increased”.

“Moreover, our confectionary products are facing extreme competition in international market,” he added. app

Daily Times - Leading News Resource of Pakistan

 

[Moin91]

5,000 attend admission tests for MBBS and BDS

Monday, September 10, 2007

Karachi

The Dow University of Health Sciences (DUHS) conducted tests at the Karachi Expo Centre on Sunday for Bachelor of Medicine and Bachelor of Surgery (MBBS) and Bachelors of Dental Surgery (BDS) admissions in the city’s colleges.

The colleges for which admission is being sought are Dow Medical College (DMC), Sindh Medical College (SMC), Dow International Medical College and Dr Ishratul Ebad Khan Institute of Oral Health Sciences.

According to a university press release, about 5,000 candidates participated in the tests for the 650 seats available for MBBS and BDS degrees.

A help desk was available at the site for the guidance of candidates, where their admit cards were also checked through computers. Students entered using electronic gates for security reasons.

Vice Chancellor Dow University Prof Masood Hameed Khan, Principal DMC Prof. Salahuddin Afsar and Principal SMC Prof. Tariq Sharafatullah also monitored the admission tests.

The answers key for the test will be displayed at the Dow University website - DUHS Portal - from Sunday while the official result will be announced within a few days.

 

[AgNoStiC MuSliM]

Asian Bank to fund mass transit second line​

By Intikhab Hanif

LAHORE, Sept 9: The Asian Development Bank has reportedly agreed to also fund the estimated $2 billion second line of the Lahore Rapid Mass Transit System Network covering 26.6km from Thoker Niaz Beg to Mehmood Booti via Multan Road.

“The bank has conveyed to also fund the second line of the rail service which we are planning on the pattern of a similar facility in New Delhi. It (ADB) has already committed to fund the main line form Shahdara to Ferozepur Road’s Hamza Town costing an estimated $2.5 billion,” official sources informed Dawn here on Sunday.

They said the loan would be advanced on easy terms in view of the viability and importance of the project.

They also said spadework for the first main line was near completion and the process of acquisition of land for it would be started in a week or two. As a result, the work on the construction of the depot (main station) would be started by the end of this month or early next month, they added.

They said the geo-technical investigations had also been started on this main line and tests were being conducted at four places near Shahdara and other parts of the city to be covered by the route.

The first line will cover 27km area from Shahdara to Hamza Chowk via Ravi Road, Bhatti Chowk, Lower Mall, The Mall, Queen’s Road, Mozang Chungi and Ferozepur Road. It will have 15.4km elevated and 11.6km underground railway line. There will be 10 elevated and 12 underground stations.

The second line will cover 26.6km area from Thoker Niaz Beg to Mehmood Booti near Pakistan Mint via Multan Road, Chauburji, Lake Road, Lakshmi Chowk, Railway Station, GT Road and Shalamar Gardens. It will have 21.5km elevated and 5.1 underground railway line. There will be 20 elevated and six underground stations.

Asian Bank to fund mass transit second line -DAWN - National; September 10, 2007

 

[Introvert]

Chinese firm to set up 300,000 tons steel mill
ISLAMABAD, Sept 10: Baosteel, a Chinese company, has shown interest in setting up 300, 000 tons cold rolled steel plant in Pakistan.

The plant will be established in joint venture with Sapphire Group, this was stated by Director Strategy and Planning of Baosteel Dr. Lin Li in a meeting with chief executive officer of Engineering Development Board Abdul Hafeez Chaudhry on Monday.

The CEO briefed the six member Chinese delegation about increased demand in steel sector on account of economic growth in the country. He added that the gap between supply and demand was increasing and the government was desperate to fill it by encouraging foreign investment in this sector.

He especially mentioned the new projects such as Al-Tuwairqi and Aaysia steel mills. He said that the privatisation of Pakistan Steel Mill steel was expected next year and invited Baosteel to take part in its bidding.

It may be recalled that Baosteel had earlier made a bid for privatisation of PSM but later withdrew their bid due to shortage of time. Mr Chaudhry invited the Chinese company to invest in setting up a mini steel mill at Kalabagh. — Our reporter

Chinese firm to set up 300,000 tons steel mill -DAWN - Business; September 11, 2007

 

[Introvert]

Pakistan to export 10m-ton cement to India in 2008
KARACHI: Seventeen companies of Pakistan will export 10 million tons of cement to India in 2008.

According to Indian state trading company MMTC, it is expected that the production by the cement companies in Pakistan will grow by 50 percent to synchronize with the 50 per cent increase in coal imports into the country.

The local consumption of cement in Pakistan ranges from 22 to 24 million tons annually. However, the total production of cement in Pakistan is expected to surge to 35 million tons thanks to the bulging volume of exports.

According to MMTC, the cement prices in India rose by 45 percent since December 2005.

According to Indian Cement Manufacturers Association, the demand of cement has gone up by ten per cent in India during 2007.
Pakistan to export 10m-ton cement to India in 2008

 

[Introvert]

Countrywide petrol consumption rises steadily
KARACHI: The consumption of petrol in the country is rising continuously since last two months, as the sale of petrol in the month of July shot up by 11 percent, while in August, it further went up by 9 percent.

Oil industry sources attributed country’s rising petrol sale to the enforcement of Iranian petrol rationing system in June, as petrol consumption in June stood at 110,000 metric tons, which rising by 11 percent went up to 122,000 metric tons, while it further rose in August by 9 percent reaching 132,000 metric tons.

Sources told that the diesel consumption in the country last year in August amounted to 528,000 tons, which in the current year August increasing by 18 percent ascended to 623,000 tons.

Analysts told that the power shortage in the country and the large-scale use of diesel for enhancing industrial production triggered persistent surge in diesel sale in the country.

Countrywide petrol consumption rises steadily

 

[Neo]

FBR asked to declare Gwadar as EFZ ​

ISLAMABAD (September 10 2007): The Planning Commission has approached the Federal Board of Revenue (FBR) for declaring Gwadar City as Economic Free Zone (EFZ) to attract foreign tourists and investors in Balochistan.

Sources told Business Recorder on Sunday that Balochistan Governor has fully supported the proposal of Gwadar Development Authority (GDA) for declaring Gwadar city as EFZ to attract investment in transport, hotel business, tourism, entertainment, power generation, water and other projects.

The Planning Commission has requested the tax authorities to consider the proposal on top priority basis. According to GDA, there is an impression, from the beginning, that the whole of Gwadar City would be declared as free zone. A large number of investors who had expressed willingness to participate in activities like transport, tourism, water and power projects, water desalination, general manufacturing, assembling plants and packing etc were waiting for the announcement of the government's package.

Recently, the government exempted only 3 port companies from income tax. In the absence of a sustainable city, which may attract tourists as well as investors, traders, cheap labour, technicians etc, desired results may not be achieved.

The GDA, therefore, requested that the Balochistan government should approach Federal Board of Revenue (FBR) for incentives to all sectors where people may invest in Gwadar, rather than exempting only three companies from income tax.

The exemption from taxes should be given on machinery imported for industrialisation, construction and raw material imported for processing export goods, it said. However, anything moved outside Gwadar may be subject to all normal taxes, sources added.

Business Recorder [Pakistan's First Financial Daily]

 

[Neo]

Chinese firms to be engaged in mega development projects ​

ISLAMABAD (September 10 2007): Pakistan is likely to engage more Chinese firms in undertaking a number of mega development projects in infrastructure sector in a bid to lessen country's dependency on other international lending organisations.

Sources told Business Recorder that as Pakistan was keen to invest more in the development of infrastructure to ensure maintaining the present GDP growth, since it was not in a position to finance all these schemes from the national exchequer, it would go for foreign financial assistance to launch projects in water, power, and roads infrastructure.

In this context, Pakistan is searching for some lenders other than international financial institutions (IFIs), they added. The sources said that in this regard a number of senior most government officials have recently floated the idea of engaging more Chinese companies for executing mega projects.

However, various stakeholders including Planning Commission, ministries of finance, water and power, and other in the public sector not yet to reach on consensus on the issue, they added.

A number of senior most officials are strongly supporting the Chinese public and private sector involvement in Pakistan's infrastructure development, the sources said.

The sources, however, gave no detail whether the Chinese firms would be engaged in water reservoirs of which construction has already been announced by the government.

According to initial estimates, the construction of Kalabagh, Diamer-Basha and Akhori dams will cost more than Rs 1.0 trillion. The government estimates also suggest that more than $7.2 billion only for these three mega projects. The total cost of the Diamer Basha project has been estimated at around Rs 390.7 billion, Kalabagh Dam at Rs 370.5 billion and Akhori Dam at Rs 267 billion.

The estimated foreign exchange component (FEC) is $2.96 billion for Diamer Basha, $2.8 billion for Kalabagh Dam and $1.4 billion for Akhori Dam.

However, these costs are subject to change if the government failed to start work on these projects soon, the sources said. The sources added that Pakistan was happy with the Chinese assistance in the construction of deep-sea Gwadar Port. Similarly, the government was even happy with the work done by a Chinese company in Gomal Zam Dam being built in South Waziristan Agency. The Chinese company was forced to withdraw from the contract after the kidnapping of two Chinese engineers and subsequently killing of one of them.

Some Chinese companies are even engaged with cement industry that is also quite helpful. The only bad experience with such Chinese involvement was in the development of Thar coal reserves. However, that was an exceptionally difficult case, the sources said.

According to the sources, there is difficulty for the government to take up the issue of funding for big dams, as there is no national consensus on these issues.

The strong reservations of Sindh and the NWFP on the construction of Kalabagh dam are also the main obstacle in taking this issue to the IFIs. Sources said it would be difficult for government to get funding from China for the construction of Kalabagh if there is no consensus. However, other projects in infrastructure sector could be taken with the Chinese authorities.

Business Recorder [Pakistan's First Financial Daily]

 

[Neo]

Punjab plans to set-up 50 cluster centres ​

LAHORE (September 10 2007): Provincial Minister for Industries, Muhammad Ajmal Cheema has said that Punjab government will set up 50 Cluster Development Centres for technology up-gradation within 5 years in a phased programme of which 3 centres would be completed during current year.

Presiding over a high level departmental meeting here at Punjab Small Industries Corporation head office, the Minister said that with the setting up of Cluster Development Centres modern technology would be used in industrial sector besides availability of skilled workforce. He said that locations had been selected to establish Cluster Development Centres in various cities while construction of 3 centres is in progress.

He further said that Product Development Centre for composite based material for sports goods in Sialkot, Wooden furniture common facility services centre in Chiniot and Business Support Centre of electrical fitting (Bake light and plastic) industries in Sargodha are being set up while centre for development of auto parts, design tools, dies and provision of testing facilities have been completed in Lahore. On the occasion, the Minister directed the concerned authorities to complete the projects within specified period and also install modern machinery in these centres.

Business Recorder [Pakistan's First Financial Daily]

 

[Neo]

Shipbuilding: 10 orders missed due to capacity constraints ​

ISLAMABAD (September 11 2007): According to a presentation about Karachi Shipyard and Engineering Works (KS&EW), given to President General Pervez Musharraf and Prime Minister Shaukat Aziz, Pakistan missed at least 10 orders of billions of dollars for shipbuilding due to capacity restraints.

The KS&EW management presentation claimed that Singapore, Indonesia, Canada, UAE, Korea and Pakistan National Shipping Corporation (PNSC) had contacted Pakistan for building big tankers, DWT general cargo, DWT barge and Aframax, but could not be booked due to limited shipbuilding capacity.

KS&EW said shipbuilding is an attractive industry for developing nations as it employs a large number of workers and involves wide range of ancillary industry. It added that shipbuilding industry can help Pakistan reduce poverty, besides expediting the process of economic development.

It referred to countries which took advantage of shipbuilding industry and were earning considerable foreign exchange from it. These were Japan, Korea, China and Vietnam.

The KS&EW said it has already 10 years' orders to enhance its profit reasonably. It would also build submarines (S/M R&S) and corvettes and FACs, survey vessels for Pakistan Navy besides negotiating with Karachi Port Trust (KPT) for building of tugs, tender ferry OPVs (MSA). It is also negotiating contract for building 9600 t /7000 t commercial tankers.

The presentation was indicative of below capacity docking. It mentioned that KS&EW has 88 months' scheduled docking and 17 months' unscheduled docking against requirement of 105 months. It showed a big shortfall in capacity and requirement.

It also demanded big ship lift system at some alternative place as it was not possible at the present location. A comparison showed that Pakistan was at disadvantage in the region since its docks capacity is very small in comparison to competitors. Pakistan has only 26000 (?) docks size against Singapore 500,000, Dubai 600.000, Bahrain 500,000, and Oman 600,000.

The presentation also underlined the need of better ship repair facilities to meet local demand and get business from foreign clients. KS&EW claimed that Pakistan needs shipyards with bigger docks to take advantage of the opportunities, and Gwadar could be the best option for it.

It maintained that the global capacity for shipbuilding has exhausted and it was the right time for Pakistan to enter this industry with additional capacity to earn sizeable foreign exchange from it.

Both President and Prime Minister agreed with the basic concept of the presentation and approved a number of its recommendations to make Pakistan's shipbuilding industry vibrant and profit-making, in real terms.

Business Recorder [Pakistan's First Financial Daily]

 

[Neo]

Locally manufactured cars sale up by 5.75 percent ​

KARACHI (September 11 2007): The locally manufactured cars sale increased by 5.75 percent to 28,225 units in July-August as compared to 26,690 units sold in the corresponding period of 2006.

According to the statistics, released by Pakistan Automobile Manufacturers Association (PAMA), the production of cars in the country increased by 2.4 percent to 27,700 units in two months of 2008 financial year from 27,100 units in the same period last year.

The company-wise sales volume indicates that the sales of Honda Atlas cars increased by 2.39 percent to 3,165 units in this period against 3,091 units sold during the same period last year.

The sale of Pak Suzuki Motors surged by 2.14 percent to 14,911 units against 14,598 units, Indus Motor by 12.40 percent to 9,456 units against 8,413 units, while the sale volume of Dewan Motor increased by 17.86 percent to 693 units against 588 units.

The 1300cc and above car segment is still leading overall car sales, with the market share of 38.8 percent during July-August, Abdul Azeem at Invest Capital & Securities Limited said.

In addition, 1000cc to 1299cc and 1300cc and above segment held 29.8 percent and 30.4 percent market share respectively, he added. According to the company-wise market share, Honda Atlas cars' market share stood at 11.21 percent in July-August period against 11.58 percent during the same period last year, Pak Suzuki Motors's share was 52.83 percent against 54.69 percent, Indus Motor: 33.50 percent against 31.52 percent, while the market share of Dewan Motor increased to 2.46 percent in this period against 2.20 percent previously.

Business Recorder [Pakistan's First Financial Daily]