Pakistan Economy - News & Updates - Archive

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Need for a long-term industrial strategy​

After losing a great deal of time, the government is to undertake formulating a long-term industrial policy.

In spite of the eight five-year plans and two major perspective plans, the government has been pursuing a sectoral approach to industrial development instead of a robust composite one.

The outcome is obvious. The contentious textile policy is failing and the sugar policy suffers from its frequent setbacks. However, the cement manufacturing policy is currently a success.

A long-term industrial policy is needed for three major reasons: to provide employment, to increase the exports and to accelerate its economic growth.

While a large number of workers are employed in industries, their wages are low, but from an investor’s point of view the productivity of labour is also low because of lack of education and inadequate technical training.

The industrial policy has to be on a long-term basis as investment is usually made with borrowed capital from banks. And if the industries do not work properly, the lending banks will suffer. Unless the industries are managed well and the loans are serviced diligently the banks would not be ready to lend for industrial investment.

Local businessmen were quick to fill the vacuum in the textile and sugar sectors as the raw materials were readily available in the shape of cotton and sugarcane. The cement industry was also developed in a big way. India now wants three million tons of cement from Pakistan.

While the textile industry developed, no effort was made to manufacture textile machinery which is imported at a heavy cost year after year. The machinery parts are also imported. The textile industry prefers to buy from foreign suppliers because of the large kickback it gets on the imported textile machinery. So, attempts made to manufacture the textile machinery locally have not been a success. India is not only manufacturing the textile machinery but is also willing to offer it to Pakistan at attractive prices, but the import of Indian machinery in a big way is being discouraged for political reasons.

Investment did not go into the coal mining industry although plenty of coal was available. Even now, we are depending on foreign investors to develop the Thar coal fields. Our industrialists want easy profits made from quick business and not to labour too hard.

A major shipbuilding venture Karachi Ship and Engineering Works was set up. But apart from some boats made for China, the shipyard did not make much headway. We ended up in ship breaking industry and in 1980s and 1990s became the biggest ship breaking country in the world.

We wanted to embark on shipbuilding without the basic raw material – steel – Pakistan Steel Mills was producing one fourth of the steel we needed. When it was established, the capacity of the steel mill was to go from one million tons to three million tons. So, any attempt to build ships without the basic steel had to fail.

And now, Pakistan Steel is to be privatised and two ship building yards are proposed to be set up to promote the shipbuilding industry. How much of a success we can achieve without the basic raw material – steel - when prices of the metal are rising all round, remains to be seen.

India could make headway in the steel sector as its steel manufacturing industry is even older than its independence.

There is Japan for example that is a unique country without raw materials that has become an industrial power, its workers are educated, technically trained and disciplined. So Japan has made tremendous progress in the technological sector. But Pakistan cannot make use of its own research. The research work done in the Pakistan Council of Industrial and Scientific Research and the National University of Science and Technology are not utilised by the industrialists.

If we do not make use of our own research and instead cry for the research work done abroad, what kind of industrial progress can we make? The linkage between the research institutes and the industries needs to be strengthened.

The Engineering Development Board (EDB) was very active at the time Mr Razzak Dawood was its chairman. It had taken various measures to promote the industry and recently it had a meeting in Karachi to develop the chemical sector. It is also giving attention to eliminating the freight problems as the transportation system is inefficient.

However, no headway has been made in the engineering sector in spite of the Heavy Mechanical Complex, the Machine Tool Factory, the Heavy Electrical Complex and other such institutions. These units were scheduled to be privatised but the effort has been suspended pending further study of the issue.

We are trying to export of our engineering products at a time when we are buying more and more of Chinese engineering goods. Our water equipment for domestic use is as good as the Chinese one, but there is a preference for the Chinese products as they are cheap.

We should take pride in our products and patronise them instead of preferring foreign products in the belief that anything foreign is better. But efforts should also be made to improve the quality and prices of local products.

Need for a long-term industrial strategy -DAWN - Business; December 10, 2007

 

[Neo]

Demand for Balochistan coal​

Balochistan plans to set up a coal-fired power plant of 50 megawatts to overcome power shortage in the province. Last week, the provincial government signed a memorandum of understanding (MoU) with a Canadian firm for undertaking the project by utilising locally extracted coal.

Under the deal, Balochistan Power Generation Limited (BPG) and Canadian Everlight Energy Corporation (EEC) would prepare project feasibility and submit it to provincial Thermal Power Board for approval. The Board would settle matters relating to tariff and supply of electricity between Quetta Electric Supply Company (QESCO) and these companies. The companies would be bound to spend five per cent of their total revenue on development of social sector in the areas where they supply power.

Pakistan Steel Mills Corporation (PSMC) also plans to purchase 60,000 tons of coal during the current financial year from the province. The PSMC chairman recently visited Balochistan and found the coal of good quality that fulfils the Pakistan Steel criteria.

The coal can be used for power generation and in different industries.

The coal reserves in the province are estimated at 196 million tons. Presently about 1.5 million tons are being mined from the various fields. The 60km-long Chamalang mines produce good quality coal that ranges from high volatile C bituminous to high Volatile A bituminous with a total reserves of six million tons.

Presently, over 80 per cent of the local production of coal is being used by bricks makers, while the rest is being consumed by cement factories to blend it with the imported coal to reduce the cost of production. About one per cent coal is utilised by coal-based power plants.

There is no facility of washing plant, and that’s why cement industry is forced to import coal. There is vast scope for investment in coal-washing plants. Raw coal contains different impurities like sulphur, calcite, clay, rock and shale. This impure coal cannot be utilised in the industry hence impurities must be washed out. For saving energy and cost, there is a need to set up coal washing plants in the province.

A few years back, Small and Medium Enterprise Authority (Smeda) Balochistan proposed that coal-washing plants should be set up to meet specific standard of the cement industry. Coal is the cheapest source of thermal energy used in industrial sector. It has the potential to replace other expensive fuels such as furnace oil.

According to an estimate, the use of coal instead of furnace oil can result in a saving of about Rs495 million per year for a plant producing 3,000 tons of cement per day. According to an estimate cement industry requires around 3.5 million tons of coal to run its plants.

The government has decided to increase the share of coal in the country’s energy mix from 7.6 per cent to 18 per cent by the year 2018. In view of the rapidly mounting energy deficit, there is a need to modernise the province’s coal-mining sector.

Pakistan’s coal mining sector has urged the Federal Board of Revenue (FBR) to extend tax incentives which include duty-free import of mining machinery, equipment and transportation trucks, withdrawal of GST for another five years, bank loans at three per cent interest and the depreciation allowance exceeding 50 per cent of the total investment.

The supply of coal from Chamalang mines, earlier stopped, has started. The Chamalang-Mekhtar track has also been made operational for heavy traffic, enabling coal trucks to go to the markets. The mines were made operational following the tripartite agreement between the Marri and Luni tribes and mine contractors last year.

The project also envisages education facility for 300 students by the army. The package includes free education, books, uniforms, stationery and monthly stipend of Rs500. In the initial stage, the army would bear the cost. Later it would be managed through the Chamalang Development Fund.

Demand for Balochistan coal -DAWN - Business; December 10, 2007

 

[Neo]

Foreign buying pushes market upward​

THE Karachi Stock Exchange 100-share index last week maintained its upward drive towards its next chart point of 15,000 level followed by strong foreign and local buying on selected counters.

The volume, which had dropped to a single session total of 200m shares, soared to well over 300m, a normal figure in a bull market.

The sustained bull-run, in which the market capital swelled to a record Rs133 billion or over 4.4 trillion and the 100-share index by 475 points, reflects investors’ mood led by a section of foreign funds which covered positions in the leading oil and bank shares.

Stocks, therefore, finished with widespread gains as investors continued to build long positions on the banking, oil and cement sectors after reports of higher corporate earnings and expected handsome payouts.

“It appears to be a judicious blend of both local institutional and foreign buying expecting positive developments on the political front despite a loud whispering about the elections boycott”, leading analyst Ahsan Mehanti said.

He said foreign investors rarely re-enter the market but on assurance from some quarters which matter.

The locals follow them for good reasons as no one wants to miss a bait of capital gain.

During last week, the KSE index had gone up by about four per cent paving the way for a price flare-up on most of the low-priced blue chips counters.

Analyst Ashraf Zakaria said the market was relying on better corporate earnings and revival of foreign buying, although the year-end buying was still to emerge in a big way.

After the mid-week, the market advance was led by banking shares after reports that their managements were booking capital gains before Jan 1, when capital gain tax may be effective, a leading analyst Hasnain Asghar Ali said adding “there was, however, no dearth of ghost buyers at the prevailing rates”.

The KSE 100-share index maintained its upward drive for the third session in a row as investors did not want to miss the rising market and capital gains.



It finished with an extended gain of 475.38 points or 4.5 per cent at 14,473.9 as compared to 13,998.52 a week earlier. Its junior partner, the 30-shares index, on the other hand, rose by 629.33 at 17,385.05.

Over the last three sessions, the market rose by 4.5 per cent, adding Rs133 billion to the capital to 4.462 trillion, a hefty increase in a week viewed by any standard, analysts said.

Massive rise of Rs19 in MCB followed by GDR-linked buying and other leading base shares, notably National Bank, OGDC, PTCL and Bank of Punjab were the chief contributors to the current rise in index.

Muslim Commercial Bank alone has the largest weightage 11 per cent in it and adds significantly to its rise in a single session, more than a half, than the combined.

“A section of the foreign investors is in the market and making selective covering purchases on the banking, oil and some other counters at the current lower levels”, analysts said but failed to pinpoint any specific reason behind the revival of foreign demand.

But some others said that despite a local political mess, they may have found some clue to future share market outlook and were back in the arena.

“The current lower levels, the talk of higher corporate earnings and good payouts are the chief motivating factors behind the current run-up”, some others said.

Forward counter: A virtual price flare-up in the share of MCB on GDR-linked support highlighted the trading on this counter, which rose by about Rs23 followed by Pakistan Oilfields, OGDC, National Bank, D.G. Khan and Lucky Cement and some others.—Muhammad Aslam

Foreign buying pushes market upward -DAWN - Business; December 10, 2007

 

[Neo]

Pearl Continental to launch Hotel One ​

LAHORE (December 11 2007): Hashoo Group Chief Executive Officer Murtaza Hashwani has announced that the Pearl Continental will launch the Hotel One, a budget accommodation, planning to establish 20 new hotels in six locations, beginning operations in the coming three months in Lahore, Sialkot and Faisalabad.

While addressing a press conference to unveil the concept of Hotel One, he said there is a huge potential for budget accommodation in Pakistan that aims to attract both local and foreign tourists at affordable rates. He also said a master franchise agreement was reached between the Pearl Continental and the Hotel One, ensuring strict standards of quality and service whereby quality bathroom and linen standards in line with Pearl Continental practices will be maintained.

"Hotel One would be a three-star hotel that would offer all the conveniences to ensure a pleasant and comfortable stay such as round-the-clock restaurants, overseas direct dialing, mini-bars, 85 satellite channels and car rental services would be available to the guests. Also for value addition, there would be complimentary tea and coffee makers in all rooms and all guests will enjoy access to high speed Wi-Fi Internet connectivity absolutely free of charge. The charges for a room per night would range between Rs 4000 and Rs 4500," he added.

He said in the next two years, the Hotel One planned to establish 20 flew hotels. Up to 250 rooms would be developed at an average of 40-50 rooms per property in the next three months. The expected investment for this ambitious project by the Hashoo Group would be between approximately Rs 2 and Rs 2.5 billion. In respect to employment opportunities, nearly 3000 employees would be hired in the next two years with 500 of those individuals becoming resource personnel and staff members in the next three months.

"With Hotel One, Hashoo Group, the leader in five-star hotel market adds another jewel to their crown. The Hotel One philosophy resolves around bridging the gap between the luxurious and the affordable. This stems from the continued commitment of the Hashoo Group in developing and promoting the hospitality and tourism sector in Pakistan. This vision is further consolidated through the induction of me Hashoo Group's launch of a hospitality institute that helps to nurture employees and the unemployed youth of Pakistan, in respect to their skills and earning potential," he added.

Business Recorder [Pakistan's First Financial Daily]

 

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China assures Pakistan to cut trade imbalance: FPCCI ​

BEIJING (December 11 2007): China has assured to make every effort to remove trade imbalance currently in its favour, said former President of Federation of Pakistan Chamber of Commerce and Industry (FPCCI) and Patron In-Chin of Pak-China Business Forum, Tariq Sayeed on Monday.

The assurance was given to him at a meeting by Vice-Chairman of Chambers of International Commerce Shanghai, Chen Jian Hua. Later, talking to APP from Shanghai Tariq Sayeed informed that Chen has assured that China "would help support Pakistan in getting market access of its products in order to improve trade imbalance." Tariq Sayeed pointed out that there was huge potential of number of items particularly rice, leather, surgical instruments, fish and fish products that China can import from Pakistan thus improving trade.

He said that Chen informed him that his government was fully alive to the trade imbalance and would make every effort to reduce it. Tariq Sayeed on the occasion highly appreciated China's tremendous support in economic development of Pakistan by setting up various mega projects including establishment of Gwadar Port, Heavy Machine Tool Complex, power stations, etc. He, on the occasion, presented various suggestions to improve the trade deficit including Chinese investment in Pakistan, establishment of joint ventures, and promoting Pakistani products in various exhibitions that are taking place in China.

Business Recorder [Pakistan's First Financial Daily]

 

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'Private sector role vital for socio-economic growth' ​

KARACHI (December 11 2007): Fakhruddin G Ebrahim, a former judge of the Supreme Court, has said that socio-economic growth could not be achieved without private sector's participation. Hence, it is the need of the hour to evolve sustainable policy in this regard.

He said this while addressing the inaugural session of 'Employers National Convention 2007', organised by Employers' Federation of Pakistan (EFP) at a hotel here on Monday.

Other key speakers included Jose Manuel Salazar, Executive Director, International Labour Organisation (ILO), Ashraf Tabani, President of EFP, Donglin Li, Drector, ILO, Islamabad, and Khursheed Ahmed, Secretary General, Pakistan Workers Federation.

Fakhruddin said that economy of Pakistan was growing at a rapid pace with the efforts and co-operation of the private sector, but the sector needs sustainable policy, with proper execution by the government.

He said that the government should actively collaborate with the private sector, including employers and workers, for achieving sustainable economic development and fruitful industrial growth.

He lauded the role of ILO in making kind relation between employers and workers for a positive social dialogue, and added that ILO always strove to promote sustainable employment with decent working condition.

Salazar said that enterprises should be managed with modern principles by responsible management, and urged the government, and societies, to create a conducive environment for business.

"There is a need of joint efforts between government and private sector to make business-friendly environment for local and foreign investors for creating better livelihood opportunities for the countrymen," he said.

"It will also help to rehabilitate those who are living below the poverty line in the society," he added.

He said that ILO always called for new forms of co-operation among government, business, labour and society with the aim to provide better working conditions to both labour and employers.

Tabani said that EFP was playing a positive role in the growth of the country's economy and enabling enterprises to be productive and profitable in creating decent job opportunities. A large number of participants from every walk of life attended the convention.

Business Recorder [Pakistan's First Financial Daily]

 

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ADB considering to provide $225 million to Punjab government ​

FAISALABAD (December 11 2007): Asian Development Bank (ADB) is considering a proposal to provide $225 million for "Effective Implementation of Punjab Government Efficiency Improvement Programme" to improve allocation of public resources by introducing greater performance-orientation in planning and budgeting.

According to sources of Planning and Development Department of Punjab, under this proposed project, a financially sustainable and adequate pension system will be develop in the province, while an efficient and effective civil services programme will be launched.

This programme will develop a dynamic private sector in the province, while all the benefits will contribute to broad based economic growth, employment creation, poverty reduction, and social development, which will significantly raise the living standards in Punjab.

The PGEIP will also support the GoPb in realising its long term vision as articulated in the Punjab Vision 2020 which commits to significantly improving the standards of living for the people of Punjab, especially the poor and the vulnerable. The impact of the proposed PGEIP is to improve the overall functioning of the government machinery at the provincial, district and municipal levels, and thereby improve the quality of public services. Its impact will be in the form of (i) greater performance-orientation in planning and budgeting; (ii) higher efficiency of the civil service apparatus, with sound incentives and merit-based appointment and career-progression; (iii) a fully funded and well-managed pension system that increases the confidence of civil servants and the public, and generates fiscal space for high priority social sector investments; and (iv) a redefined role for the State, and greater private sector participation.

According to official sources, the Punjab government has laid down an ambitious Vision 2020 which aims to double per capita income over the next decade. They has also implemented service delivery reforms through ADB-supported Punjab Devolved Social Services Program (PDSSP) and judicial reforms through the federal level Access to Justice Program. GoPb requested ADB to undertake the second generation reforms to continue the PRMP.

Business Recorder [Pakistan's First Financial Daily]

 

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Removal of tariff barriers: Indo-Pak bilateral trade may reach $9 billion ​

LAHORE (December 11 2007): Lahore Chamber of Commerce and Industry President Shahid Hassan Sheikh has said the removal of tariff and non-tariff barriers between India and Pakistan is a must to boost the bilateral trade.

"There is a need to further improve the transportation and communications infrastructure, procedures and valuation and standardisation and quality control measures," he said when he returned from a five-day tour to Chandigrah and New Delhi in connection with the ITEX-07 arranged by the PHD Chamber of Commerce and Industry.

PHDCCI President Sanjay Bhattia and his Pakistani counterpart, Sheikh, opened the exhibition. The Lahore Chamber of Commerce and Industry arranged the delegation to the ITEX-2007 on an invitation by its Indian counterpart.

"The removal of such barriers can jack up Indo-Pakistani trade to $9 billion in a relatively short timeframe," Sheikh said. He added that certification and standardisation of goods should be fixed on some items to make ease the process.

He had several high-profile meetings including Governor of Indian Punjab SF Rodrigues, Chief Minister of Haryana Bhupinder Singh Hooda and President PHD Chamber of Commerce and Industry Sanjay Bhattia to discuss several issues.

Former LCCI vice President Sheikh Mohammad Arshad was also present in the meetings. Both sides decided to activate Joint Study Group to chalk-out export strategy to increase bilateral trade between India and Pakistan. They believe the trade and industry should be given a chance to drive policy making in both countries.

According to estimate, the present unofficial trade between the two countries is around $2 billion. He said removing trade barriers and opening of new trade channels might pose serious challenges to our industries, but they will be a positive step for the two countries.

The Pakistani delegation members lauding both governments for allowing lorry movement to each other's terminal called for giving permission to cargo traffic at their destination points.

He said such steps would not only help Pakistan but also India. The Pakistani team called for setting up certification and standardisation of goods to be traded between the two countries, particularly for "ayurvedic" products having a steady demand in Pakistan. On Indian side's request, Pakistan Embassy officials handed over a list of 25 items for an early certification.

Commodities like textiles, surgical products, sports and leather items and cutlery that face non-tariff barriers at Indian ports and entry points that restrict exports. Imports from India currently are worth $1.25 billion while Pakistan's exports have grown slowly from $280 million in 2004-05 to $370 million in 2006-07.

Business Recorder [Pakistan's First Financial Daily]

 

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Real per capita income: India behind Sri Lanka and Pakistan ​

ISLAMABAD (December 11 2007): Brunei, Singapore, Hong Kong, China rank among the top five economies in developing Asia and the Pacific in terms of real per capita income, says a new study undertaken on purchasing power parities in the region.

According to the 2005 International Comparison Programme (ICP) in Asia and the Pacific: Purchasing Power Parity and Real Expenditure released on Monday, there is a huge disparity in real per capita Gross Domestic Product (GDP) in the region.

India, one of the fastest growing economies in the region, has a per capita income lower than the regional average, behind its neighbours Sri Lanka and Pakistan. The PRC, the region's growth engine, has above-average real per capita income.

The study, which provides a snapshot of economic measures like income, consumption expenditure and capital formation, is part of a global initiative that allows cross-country comparison purchasing powers of currencies and living standards. The ICP, which was co-ordinated globally by the World Bank, will allow comparison of major economic indicators for 146 countries globally.

The Asian Development Bank (ADB) was the regional co-ordinator for the ICP Asia-Pacific, which accounts for half the world's population. Statistical organisations of the region actively participated in this initiative.

Purchasing Power Parity (PPP) is an idea popularised by The Economist's Big Mac Index, which prices hamburgers in global cities for a quick and crude comparison of inter-country price levels. The ICP is an attempt at a cross-country comparison of key economic indicators based on PPP and provides the most comprehensive cover of a broader range of commodities.

For the first time, the People's Republic of China (PRC) and India, which together make up 64 percent of the total real GDP of the 23 economies participating in ICP Asia-Pacific which simultaneously joined this regional initiative to estimate the purchasing power parities of currencies. However, data collection and price estimation, especially when nation wide price data are not available, of various components of an economy's consumption basket pose challenges for measurement of PPP.

"The data and the results should be interpreted carefully. It is the beginning of a global and regional effort, which, in turn, will improve the robustness of future PPP estimates," says Afzal Ali, Chief Economist of ADB.

The richest economy, Brunei, has a per capita GDP more than 13 times the regional average and more than 40 times larger than the lowest ranked economy, Nepal, says the study. According to ICP, however, both the PRC and India still lag the regional average when ranked in terms of Actual Final Consumption Expenditure (AFCE).

Business Recorder [Pakistan's First Financial Daily]

 

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Pakistan has potential to become sixth largest economy: Salman ​

LAHORE (December 11 2007): Caretaker Finance Minister Dr Salman Shah has said that Pakistan is the sixth largest country in terms of population though it has the potential to become the sixth largest economy.

"Out of Pakistan's 160 million population, one million people are below 25 years who have to participate in the growth and development of the country and run the affairs for up to next 50 years," he told the inaugural session of BMA Trade's Lahore branch here on Monday.

Pakistan's economy was the fastest growing economy in Asia and its macro economic foundation was very strong, he said adding one day it would emerge as the sixth largest economy of the world. He said that the current growth of the stock market showed a strong economic potential of the economy. "Despite political upheavals Pakistan's stock market is growing well and now the index has recovered from the after effects of politics," he added.

Terming the forthcoming elections as good omen for the economic outlook of the county he said that participation of all big parties in the general elections showed their maturity in politics.

Dr Salman said that Pakistan's public debt deficit, which was 100 percent of the GDP in 1999 dropped to 55 percent while it would soon lower to 25 percent. Likewise, Pakistan ratings were very good and are improving because of its strong economic fundamentals, he added.

He further claimed that the GDP, which stood at $63 billion in 1999 had now increased to $160 billion. He added that apart from foreign and local investment, portfolio investments was also pouring all sectors from construction to services.

Appreciating BMA Trade's initiative to open its branch in Lahore, Dr Salman Shah said it had enhanced its operations in the last few years and he was hopeful that it would open more branches. In a speech earlier, BMA Capital Managing Director Moazam Malik said they were present in all major cities and hopefully would open branches in small cities as well.

He said BMA Trade was launched over two years ago, which had rapidly grown into a network of 10 branches in the seven cities across Pakistan. He said, "in Lahore, we will offer complete menu of our services which are being offered in Karachi including futures trading and online trading. We want to be one-stop shop in financial market of the country."

Business Recorder [Pakistan's First Financial Daily]

 

[Neo]

MOL awards $130 million contract to under-liquidation company ​

ISLAMABAD (December 11 2007): MOL Pakistan, a Hungarian oil and gas exploration and production company operating 'TAL' block in NWFP, has disqualified Hanover, an American company, for the over $130 million field development project, on technical grounds, without even opening its envelope and awarded the contract to an under-liquidation company, Presson Descon International Limited (PDIL), on single-source basis.

Sources said that Presson Desscon and Hanover were in the run for MOL Pakistan's over $130 million project at the last stage. The operator disqualified Hanover on technical ground, saying that it did not meet the requirement, but accepted, in a letter, that did not open Hanover's envelope for evaluation of its technical qualification.

MOL's letter, written in response to a Petroleum Ministry query, said: "Based on the first stage of bidding, it was found that Hanover was considered not to have satisfied the criteria in the invitation of bid. However, its technical bid was not opened".

One should wonder how MOL Pakistan determined that Hanover fell short of the technical requirement of the tender, without opening its envelope for evaluation. It establishes that MOL Pakistan wanted to pick up Presson Desscon, by excluding Hanover from the bidding process, for such a big contract. MOL Pakistan owns only 8 percent share in TAL block, and the rest 92 percent stake goes to OGDC and PPL, the public sector companies whose job is to make sure that any contract, wherein public money is involved, is given to any company through a transparent 'procedure of bidding'

It had also disqualified Presson, at an earlier stage, from participating in bidding process on litigation ground. But, taking a lenient view it not only qualified PDIL technically and commercially, knowing well that it was under liquidation, but also approached MoP for seeking its nod to award it the contract on single-source basis. This indicates poor process being followed by MOL for award of a big contract.

PDIL letter, dated October 19, confirmed that a petition filed by Currentage International Marketing (Pvt) Limited was pending for a final decision before the Lahore High Court but it was expecting some out of court settlement with the petitioner. MOL Pakistan has already awarded a $12 million pipeline contact for Gurgari plant through a selected tender, well short of standard procedure for bidding.

MOL's style of working and awarding contract of millions of dollars to 'selected' parties needs to be looked into. It's the prime responsibility of the Ministry of Petroleum to see what goes on in the name of development of Mangali field since its major stakeholders, PPL and OGDC, are from public sector, and the money being spent on their behalf is coming from public exchequer.

Business Recorder [Pakistan's First Financial Daily]

 

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Dairy, cattle-farming and livestock: Sindh sends offer for Qatari firm on over $100 million projects ​

KARACHI (December 11 2007): The Sindh government has officially sent an offer to a Qatari firm through the Board of Investment (BoI) to start work on mega project of dairy, cattle farming and livestock as planned by the firm with an initial investment of over $100 million.

Sources in the Sindh Land Utilisation Department told Business Recorder here on Monday that the offer has been forwarded to the firm concerned 10 days back via BoI to acquire land of around 5,000 acres in Interior Sindh for the mega project.

"But since the offer made, no response from the Qatari firm has been received to the provincial government on acquisition of the land," they said.

The Qatari firm had asked the provincial government to provide 10,000 acres of land to initiate the cattle-farming project at par with the developed countries like Australia and New Zealand.

However, the Sindh government has decided to provide 5,000 acres of land in Thatta district and Livestock experiment station Nabisar Road, Taluka Kunri, Umerkot, on a lease for a period of 99 years, sources said, adding that rest of the land as per demand of the firm would be provided later in different parts of the province.

Responding to a query of price of the land and the procedure on which it would be provided, sources said the statement of conditions of land provision for mega project of dairy, cattle-farming and livestock would be disclosed after getting consent from the firm.

"We are waiting for response in writing from the officials of the Qatari firm over the proposed project aiming at increasing livestock and cattle-farming in the country," they added.

Business Recorder [Pakistan's First Financial Daily]

 

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Pakistan, China to promote ties in oil and gas sector ​

ISLAMABAD (December 09 2007): Ambassador of China, Lou Zhao Hui called on Minister for Petroleum and Natural Resources, Ahsan Ullah Khan here on Saturday and discussed with him matters pertaining to promoting bilateral co-operation in the petroleum sector.

The ambassador felicitated the minister for assuming the portfolio of the Ministry of Petroleum and Natural Resources in the caretaker cabinet and hoped that Sino-Pak historic friendly relations would further grow and flourish during his tenure.

Business Recorder [Pakistan's First Financial Daily]

 

[ejaz007]

PC to set up 20 budget hotels
By Our Reporter

LAHORE, Dec 10: Pearl-Continental Hotels will establish 20 budget hotels in the country during the next two years with six beginning operations in Lahore, Sialkot, Faisalabad, Gujranwala, Karachi and Multan during the next three months.
Announcing this at a press conference here on Monday, Hashoo Group Chief Executive Officer Murtaza Hashwani said the budget hotels, known as Hotel One, would have an average 40 to 50 rooms each with three to four star facilities.
Approximately, 250 rooms would be developed during the next three months. Hashoo Group would invest Rs2 to 2.5 billion in the project and hire nearly 3,000 employees during the next two years with 500 becoming resource personnel and staff members during the next three months.
He said a master franchise agreement had been reached between the PC hotels and Hotel One for ensuring strict quality and service.
He said that the Hotel One would bridge the gap between the luxurious and the affordable. The hotels meant mainly for the sales force members visiting different cities would have round-the-clock coffee shops instead of banquet halls. The daily room rent would be Rs4,000 to Rs4,500.
Hashoo Group would also make arrangement for providing hospitality training to 10,000 persons in Lahore during the next five years.

PC to set up 20 budget hotels -DAWN - Business; December 11, 2007

 

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Foreign investors eye Pakistani air routes ​

Tuesday, December 11, 2007

KARACHI: The Civil Aviation Authority (CAA) of Pakistan is in negotiations with two Middle Eastern parties interested in starting domestic air service in the country, Director General CAA Farooq Rehmatullah told The News on Monday.

The prospective air service might also extend to other countries of the region, he said, but preferred not to disclose the names of the potential investors at this point of time. The new aviation policy allows private carriers to go international after completing the mandatory one year operational period on domestic routes.

This disclosure comes on eve of the formal inauguration of the first privately run airport of the country and coincides with a period which is seeing a growing interest in the international air traffic from Pakistan with some major airlines increasing their number of frequencies and adding more cities to their networks.

However, this interest in the international passengers has not been complemented by any surge in competition on domestic routes primarily because of the poor financial health of the Pakistan International Airlines (PIA) and inability of other domestic carriers to expand their wings in a big way.

Even the encouragement offered by the new aviation policy for start of an air service on domestic routes with minimum investment has not materialized. The policy says intercity routes could be allotted to airlines which own small aircraft.

“It is not lack of interest. Such things take a lot of time,” Remattullah said. “You need engineering support and pilots and the cabin crew needs to be trained.” CAA has already accorded permission to a private carrier to operate commuter service between Karachi, Hyderabad and Lahore.

The airline, Aircraft Sales and Services (ASSL), will use a 48-seater twin engine aircraft on the route that links two domestic transit hubs with a relatively less developed city. ASSL was to start the operations back in September on thrice weekly basis but the inauguration has been delayed till next year. DG CAA also said that a number of private investors have showed interest in building and running private air strips in line with the Sialkot International Airport.

Foreign investors eye Pakistani air routes