Pakistan Economy - News & Updates - Archive

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Nine percent decline in cement exports in one month​

ISLAMABAD (May 06 2009): Pakistan's cement industry, which pocketed windfall profits in previous years, is claiming that its exports declined by 9 percent in April as compared to March 2009. The All Pakistan Cement Manufacturers Association (APCMA) is already in hot pursuit of fiscal incentives in the 2009-10 federal budget with the argument that it would collapse if the government did not extend a rescue package to it.

The Association says that reduction in Public Sector Development Program (PSDP), the high cost of energy, high interest rate and Rs 96 per bag tax are some of the reasons for the decline in cement industry. According to the Association's data for the first ten months (July-April) of current fiscal year, local dispatches declined by 15 percent, whereas 6.47 percent growth had been witnessed in the previous year.

Last year, local dispatches were estimated at 22.396 million tons, against the 15.909 million tons of first ten months of current fiscal year. Overall exports of clinker and cement increased by 51.3 percent, to 8,996,839 tons against 5,946,706 tons of last year. Last year, growth was 150 percent. Interestingly, the data released by the cement manufacturers does not contain the impact of high cement prices.

Analysts in the Ministry of Industries and Production have termed cement manufacturers' claim of financial losses as an effort to harvest more financial gains by understating some of the facts, which are challengeable. The cement industry is of the view that the cost of one bag of cement, inclusive of all duties and taxes, comes to Rs 358, whereas it is being sold at Rs 340, which means that manufacturers are already facing a loss of Rs 18 per bag.

"Without concerted efforts, the cement industry will collapse," the industry said in a presentation to the government, a copy of which was made available to this newspaper. The cement industry, which operated on 81 percent capacity, is now utilising 71.57 percent of its capacity due to world-wide economic melt down.

The figures show that cement exports to Afghanistan declined from 362,869 tons in March to 244,698 tons in April 2009, followed by India, from 103,424 tons to 97,965 tons. However, export of cement from sea route increased from 300,963 tons to 341,355 tons. Thus, total export of cement and clinker in April was 1,003,943 tons against 790,547 tons. In the presentation, APCMA has tried to convince the concerned officials that the industry is about to die, because of taxes imposed on it.

"High inland costs of transportation and port handling make sea exports non-viable for the plants based in the north, which account for most of 10.59 million tons surplus capacity," the Association said. The Competition Commission of Pakistan (CPP) has evidence of cartelisation against the cement manufacturers. The Association, in turn, has taken a stay order against the CCP, which is in the process of having the stay order vacated.

 

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Health, microfinance sectors: IDB to provide $100 million​

ISLAMABAD (May 06 2009): The Islamic Development Bank (IDB) has agreed to provide $100 million to achieve the targets of Poverty Reduction Strategy Paper (SRSP-II) set for health and microfinance sectors. Sources said that recently agreed assistance is in addition to the earlier proposed three-year rolling financing plan worth $577 million for the year 2010-12.

Sources said that IDB officials held a meeting with Economic Affairs Division (EAD) and Finance Ministry officials here on Tuesday. The two sides will finalise the modalities of the assistance soon. The agreed assistance will be disbursed to Pakistan for projects in health and microfinance sectors.

The microfinance industry grew at a rapid pace of 40 percent a year during the period of the PRSP-I. By March 2008, the sector had more than 1.7 million savers, and about 1.6 million borrowers, of which nearly half were females. The provision of these loans to businesses and individuals for economic purposes helped create additional employment in different parts of the country.

Microfinance service providers are present in 105 districts, including some in the most far-flung areas such as FATA. Six specialised microfinance banks currently provide services, with a major share of their advances going to the livestock sector, followed by micro-enterprises and agricultural inputs. Several NGOs also provide microfinance services to marginalised communities. The sector is growing rapidly and plans to reach 3 million borrowers by 2010 and 10 million by 2015.

The private sector is very active in the provision of microfinance. The Pakistan Microfinance Network (PMN) is dedicated to improve the outreach and sustainability of microfinance in the country. It also aims to establish performance measures, enhance the capacity of retail microfinance institutions through specialised training, and promoting the financial transparency of such institutions. The PMN is well positioned with 95 percent of the total microfinance coverage and with the 20 leading microfinance institutions and banks as its members.

An important player in this regard is the Pakistan Poverty Alleviation Fund (PPAF), which has aligned itself with the evolving microfinance landscape in the country. The cumulative outreach of PPAF has extended to around 85 districts of the country. About 800,000 persons have been disbursed credit, with a considerable percentage of PPAF loans going exclusively to women (375,000). Up to September 2008, the PPAF had disbursed total Rs 27.5 billion to over 1.7 million borrowers. The PPAF also helps to deal with special problems. Thus, in the wake of the October 8, 2005 earthquake, an amount of Rs 300 million was diverted from PPAF's existing programme to the relief efforts.

According to the World Health Organisation (WHO) guidelines, a child should receive a BCG20 vaccination to protect against tuberculosis, three doses of DPT21 to protect against diphtheria and tetanus, three doses of polio vaccine, and a measles vaccination. The increase (in full immunisation) was particularly impressive in rural areas, from 46 percent in FY 2001/02 to 73 percent in FY 2006/07. Under the 'record' method, full immunisation rate was low at 50 percent in FY 2006/07 compared to 76 percent under the 'recall' method. However, there had been an improvement in record-based immunisation rate, from only 27 percent in FY 2001/02 to 50 percent in FY 2006/07.

 

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'Efforts underway to attract foreign investment'​

ISLAMABAD (May 06 2009): Federal Minister for States and Frontier Region (Safron) Najmuddin Khan has said that present government is trying to bring more foreign investment in the country and planning to offer legislative cover to protect investor. While talking to the Deputy High Commissioner of South Africa Qasim Pir in his office here on Tuesday, the minister said that government is committed to enhancing co-operation and harmony between local and foreign investors.

The minister said that Pakistan Peoples Party (PPP) believes in mass power and maximum efforts would be made to provide all basic facilities to the masses on their door-step on priority basis according to the vision of Benazir Bhuttoo. He said that South Africa is Pakistan's friend and a big donor. The Deputy High Commissioner of South Africa thanked the Government of Pakistan to facilitate and protection to their investors in the country.

He showed his gesture and said that co-operation will continue in all sectors especially in education field. Earlier, the minister also met country representative of UNHCR Guenet Guebere in his office. They agreed to enhance co-operation between UNHCR and Ministry of Safron to help of Afghan Refugees and RAHA project.

 

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Construction of Diamer Basha Dam given top priority​

ISLAMABAD (May 06 2009): The Government has chosen construction of Dimer Basha Dam as top priority project and would begin its construction work during the next financial year. Talking to APP the sources of the Ministry of Water and Power said that the budget allocation for the construction of Diamer Basha Dam Project would be made during the next financial year and work on offering open International Competitive Bidding has been finalised.

Its construction would help meet electricity requirements besides increasing water storage capacity, sources said. Arrangement of finances from the foreign donor agencies for the construction of the project is under process. Notice for Expression of Interest (EOI) for short listing of Consultants for Construction Supervision and Contract Administration of the Project, from Firm/Joint Ventures has been invited and the last date to receive applications is June 15.

A number of applications from international and local contractors have already been received for pre-qualification of contractors for Lot-I, 2 and 3 and evaluation for pre-qualification is under process. The dam will have a live storage capacity of 6.4 MAF and power generation capacity of 4,500 MW. The estimated cost of the Project is $11.34 billion and it is anticipated that the work will be completed by the year 2019-20.

The Project will be the highest Roller Compacted Concrete Dam in the world having height of 272 meters. Diamer Basha Dam Project is planed to build on river Indus, about 300 km upstream of Tarbela Dam Project and about 40 km downstream of Chilas Town, which is the headquarter of Diamer District of Northern Areas.

 

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ADB may extend $1bn to end power sector’s circular debt ​

Wednesday, May 06, 2009

ISLAMABAD: The Asian Development Bank has indicated that it might extend the credit line of $500 million to $1 billion to Pakistan to wriggle out Pakistan Electric Power Company (PEPCO) from the circular debt in the energy sector, a senior official at Ministry of Water and Power told The News.

“We have approached World Bank and ADB for loan to erase by June 30, 2009 the remaining part of the circular debt which stands at over Rs100 billion, as the incumbent regime had generated Rs92 billion through Terms Finance Certificates,” said the official.

“Once the whole circular debt gets cleared the smooth functioning of the power sector will be ensured,” he said.

To a question he said Pakistan is seeking the loan from ADB at LIBOR+150 to 200 basis points and in case Pakistan gets this loan, then some of the capital will be injected by the government to erase the whole circular debt.

When asked as to why World Bank has not come forward to bail the country from circular debt which became the monster and inflicted the huge damage to smooth functioning in the energy sector, the official said that World Bank has shown its inability to provide loan to the regime saying it has no space to provide credit to the country for this particular issue. “So now the regime is banking on the Asian Development Bank for the loan,” said the official.

The Finance Ministry had opposed seeking the credit from WB and ADB, as it wanted to generate the required capital by hedging the assets of the entities involved in the circular debt with the banks under the concept of REIT (Real Estate Investment Trust).

In this regard the official said that the RIET process is a lengthy and technical process and it will take at least one and half to two years, which the government cannot afford.

The government wants to erase the whole circular debt by June 30, which is why the Ministry for Water and Power is under talks with ADB.

President Asif Ali Zardari in January ordered hi economic team to wipe out in next six months the issue of circular debt in power sector and we are working in line with the President’s direction, the official said.

When asked PEPCO would be able to repay the loan with interest, the official said that electricity tariff is being increased and required pace in recoveries of dues is being introduced to make the financial health of all eight power distribution companies which ultimately make the PEPCO sound enough to easily retire the whole debt it is getting to end the circular debt.

 

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‘Pakistan lacks elements to attract investment’ ​

Wednesday, May 06, 2009

KARACHI: Portraying Pakistan as a joint venture and foreign direct investment destination depends on three major factors: a stable economy, law and order and skilled workforce, Sindh IT Minister Mohammad Raza Haroon said on Tuesday.

“Pakistan was currently lacking in all three elements,” he said while speaking to media at the 4th Information and Communications Technology Exhibition and Conference CONNECT 2009 at the Karachi Expo Centre.

The government and the people of Pakistan have to struggle to improve the economy, law and order and education and skill levels to put the country on an investment destination map, he said.

He invited foreign business delegates and local entrepreneurs to invest in the planned 200 acres IT Park on the Northern Bypass. Land has been allocated for the park, he said, adding that the project would generate immense economic activities and open new vistas of employment for the educated Pakistani youth.

Haroon articulated that holding exhibitions of international standards was a necessity for Pakistan as this was one definite way to defeat elements that were trying to tarnish the image of the nation.

Chairman of Pakistan Telecommunications Authority, Dr Mohammad Yasin said that the government’s deregulation policies over the past decade have brought about increased competition, which has helped achieve basic telephony coverage of 90 per cent.

Pakistan Software Houses Association (PASHA) President Jehan Ara praised the local IT industry for growing at a 50 per cent rate for the past 4-5 years. She said that even in the face of global economic crisis, Pakistan’s IT industry is still growing, albeit slower than the previously recorded pace.

Earlier, the IT minister stated that MQM would expose all those behind the conspiracy of 12th May 2007 and bring them in front of the public as they had a right to know who had passed orders to create mayhem in the city which had claimed many innocent lives.

Haroon said that MQM would bring out the culprits by sharing video footages and voice recordings. He said that the country was not in a very good condition and had constant internal and external threats. He said that the economic crisis had also made it very vulnerable.

 

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Hina reviews economic, trade ties with Germany​

ISLAMABAD (May 06 2009): Minister of State for Finance, Revenue, Economic Affairs and Statistics, Hina Rabbani Khar on Tuesday had an in depth exchange of views with Karin Kortman, Parliamentary State Secretary, Federal Ministry for Economic Co-operation and Development, Germany and other members of her delegation attending the ADB meeting.

Hina, who is leading Pakistan's five-member delegation to attend the 42nd ADB Annual Meeting, also discussed matters pertaining to economic collaboration between the two countries, said a message received from Bali (Indonesia) Tuesday.

They discussed matters pertaining to economic collaboration between the two countries. Talking to Kortman, the Minister appreciated Germany's role in the debt swap arrangements for the social sector development in Pakistan citing this as an example for other bilateral partners.

She emphasised on further co-operation in the energy sector, technical and vocational programmes for human resource development in the country. Further, she expressed particular interest for Germany's expertise in renewable energy. Hina also stressed on attaining relatively higher dividends, if a more focused partnership in these areas could be realised.

The German Minster appreciated Pakistan's role in the regional context, both on the political and economic fronts, especially in case of Afghanistan. The two sides agreed to develop a more focused partnership with an emphasis on capacity building.

On an area of concern, the Minister of State apprised her German counterpart of the vision and strategy that the Government of Pakistan is contemplating to reform the tax management structure at the strategic and operational levels. She reaffirmed Government's commitment to considerably improve the tax to GDP ratios and introduce significant initiatives in the new fiscal year in this context.

The Minister further apprised her German counterpart that the decentralisation process was continuing with some minor changes. The head of the German delegation viewed the solid foundation on which Pak-German economic relations were based, as an excellent framework to expand and strengthen this relationship.

Kortman, who is also the Governor for Germany in the Asian Development Bank's (ADB) Board of Governors, invited Pakistan to join the Energy Sector partnership, which has already been signed with 78 member countries to avail the energy sector assistance from Germany. Meanwhile, Hina also met Michael Foster, Head of UK Delegation to ADB Annual Meeting on Tuesday. They discussed areas of mutual interest including developments in the current political and economic situation in Pakistan.

She reaffirmed Pakistan's resolve to combat terror and highlighted the measured and firm steps the Government was taking to address the security situation in Pakistan. She shared with the UK delegation the improved economic indicators of Pakistan after the Fund support of the home grown economic, financial and administrative reforms under the nine point economic reform agenda of the Government. They also shared views on the future modalities for realisation of the commitments and pledges made at the meeting of the Friends of Democratic Pakistan and donors' conference held at Tokyo recently.

 

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Molasses exports soar by 134pc in cfy​

KARACHI: Pakistan export of molasses during the current fiscal year was seen soared by 134 percent.

According to official data, molasses exports during July-March surging by 134 percent reached $76.7 million as against $32.6 in the same period previous year.

Sindh Abadgar Board Secretary General, Nawaz Shah told Geo News that last year’s high sugarcane production spurred a vigorous surge in molasses exports. He further said that the current sugarcane crop as compared previous year stood 40 percent less, which gives rise to the possibility of molasses export falling next year.

Molasses exports soar by 134pc in cfy - GEO.tv

 

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17.7 percent more revenue received in July-April: FBR​

ISLAMABAD: The Federal Board of Revenue (FBR) has collected Rs898.641 billion in 10 months (July-April) of current fiscal year 2008-09, which works out to 17.7 percent more than the same period previous year, however, the Board faces a gigantic task of collecting another Rs350 billion in the remaining two months to meet the target of Rs1250 billion.

In April alone, the FBR collected Rs83.532 billion. According to provisional figures, collection of direct taxes in the first ten months of the current fiscal year amounted to Rs332 billion, while in the same period previous it stood at Rs284 billion.

Revenue received on account of sales tax during the period under review amounted to Rs358 billion, of which, Rs194 billion received from sales tax locally and Rs164 billion at import stage.

Federal excise duty received in July-April current fiscal year amounted to Rs90 billion and customs duty Rs117 billion.

17.7 percent more revenue received in July-April: FBR - GEO.tv

 

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India to get Afghan transit trade route​

WASHINGTON: Pakistan and Afghanistan signed on Wednesday a memorandum of understanding to begin talks on a transit trade agreement which will ultimately allow India to use the Wagah-Khyber route for trade with Kabul.

The memorandum of understanding commits the two ‘countries to achieving a trade transit agreement by the end of the year, which we believe will have great economic benefits for both peoples,’ said US Secretary of State Hillary Clinton who hosted the Afghan and Pakistani presidents for the first round of the second trilateral talks.

‘This is an historic event. This agreement has been under discussion for 43 years without resolution,’ she said.

‘Afghanistan and Pakistan have reached an important milestone in their efforts to generate foreign investment and stronger economic growth and trade opportunities.’

Secretary Clinton also used the opportunity to regret the loss of innocent lives in US bombings, saying that ‘she wanted to convey to the people of both Afghanistan and Pakistan that ‘we will work very hard with your governments and with your leaders to avoid the loss of innocent civilian life. And we deeply, deeply regret that loss’.

Later, the Afghan and Pakistani foreign ministers signed the memorandum before Presidents Asif Ali Zardari and Hamid Karzai went to the White House for a trilateral summit with President Barack Obama.

‘Pakistan and Afghanistan are conjoined twins. Our suffering is shared. Our joys are always shared,’ said President Karzai while talking to the media after Secretary Clinton.

‘The life that we live is affected by the opportunities that we have and the lack of opportunities that occurs because of the circumstances in which we live today.’

‘Today we sit here as three democratic states, enjoined in the history of democracy, looking forward to working together,’ said President Zardari while responding to his remarks.

Although India is not mentioned in the memorandum of understanding, it will be the main beneficiary of a transit trade agreement between Pakistan and Afghanistan as Kabul’s major trade partner.

Both India and Afghanistan have long insisted that Pakistan open its land route for transit trade between the two countries which do not have a common border.

But Secretary Clinton said that the opening of a transit trade route will also open new opportunities for both Afghanistan and Pakistan.

‘When … I look at the map of the world and see how strategically located both countries are, this is an agreement that will bring prosperity to both countries along the trade routes and beyond,’ she said.

‘Nothing opens up an area to economic development better than a good road with good transit rules and an ability to transport goods and people effectively.’

The agreement, she said, would also help bring more foreign direct investment into Afghanistan and Pakistan, because that’s always the first question: ‘How do we get our goods to market? How do we get them to another economy in another country?’

Secretary Clinton brought a high-powered delegation to the talks which included Director CIA Leon Panetta, Director FBI Robert Mueller, Pentagon’s Under-secretary for Policy Planning Michele Flournoy, and chief of the US Central Command General David Petraeus.

The Pakistani delegation, headed by President Zardari, also included Bilawal Bhutto Zardari, three ministers, several advisers and the DG ISI.

Bilawal Zardari, two ministers, advisers and the DG ISI left after the first round so did the CIA and FBI chiefs and Afghan intelligence and military officials.

SECOND ROUND
Only the two presidents, their foreign ministers and envoys in Washington attended the second round with Secretary Clinton who was assisted by the US special envoy Richard Holbrooke.

Secretary Clinton said that Wednesday’s discussions focussed on concrete initiatives to expand economic opportunities and trade, to bolster the agricultural sector as an essential source of revenue and jobs in both Afghanistan and Pakistan.

The three countries also discussed measures to help build the industrial sector in Pakistan, to create more jobs and opportunities for people. They also discussed measures to improve joint cooperation on security.

‘We do not believe either Afghanistan or Pakistan can achieve lasting progress without the full participation of all of your citizens, including women and girls. The rights of women must be respected and protected.’

President Zardari urged the US, ‘the world’s oldest and most powerful democracy’, to nurture democracies in other countries.

‘We thank the United States for its support for democracy, for security in Pakistan, and look forward to further support,’ he said. The president said that Afghanistan, Pakistan, and United States were all victims of terror.

‘I am here to assure you that we shall share this burden with you all, for no matter how long it takes and what it takes, democracies will deliver,’ he said. ‘My democracy will deliver.’

The Pakistanis, he said, stood with ‘our brother Karzai and the people of Afghanistan against this common threat … this is a cancer. It needs to be done away with.’

The president said that Pakistan carried a huge burden of confronting al Qaeda and Taliban together, ‘but we are up to the challenge because we are a democracy, and democracy is the only cure to this challenge.’

Mr Zardari said that as the United States was making progress after seven years of engagement in Iraq and Afghanistan, Pakistan will too.

He said that democracy in Pakistan was only seven months old and during this period, the government had performed better than the dictatorships in the past years.

Mr Zardari said that Pakistan would need high level of support in the days to come and would also be far more transparent in its actions.

‘Democracy will avenge the death of my wife and thousands of other Pakistanis and citizens of the world. Pakistani democracy will deliver. The terrorists will be defeated by our joint struggle,’ he said.

Afghan President Karzai welcomed the US promise to minimize civilian deaths in the fight against the Taliban, hoping that the US could work together with Pakistan and Afghanistan to reduce and eventually completely remove the possibilities of civilian casualties.

‘Afghanistan would like to assure the United States, its most valued strategic ally, and Pakistan, its neighbor, brother and friend’ that it would do its best to defeat the terrorists.

DAWN.COM | World | India to get Afghan transit trade route

 

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Pak, IMF discuss budget targets​

Updated at: 1103 PST, Thursday, May 07, 2009

ISLAMABAD: Pakistan and International Monetary Fund (IMF) discussing budget targets for next fiscal year.

Finance ministry sources told Geo News that finance ministry and IMF officials in an ongoing meeting in Dubai discussing budget targets for next fiscal year. IMF officials expressed concern over failure in achieving revenue targets whereas Pakistani officials in their briefing said decline in imports and economic growth rate affect the revenue collection.

Sources said IMF also exchanged views on slump in budget deficit by government of Pakistan and transfer of debts to commercial banks instead of State Bank.

 

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Telecom sector attracts huge foreign investments ​

KARACHI: The telecommunications sector attracted an investment of about $9 billion in the last three years.

This was stated by the Pakistan Telecommunication Authority chairman Dr Mohammad Yaseen while speaking at the inaugural session of 4th connect conference 2009 at Karachi Expo Centre here on Wednesday.

Long distance and international operators have made huge investment in optical fiber, system up-gradation and installation of other communications equipment, he said.

He said that the companies, like Multi-net, Wateen and Link Direct, have installed almost 15,000 km long optical fiber between Karachi and Peshawar.

If the optical fiber of PTCL is included, the total length of optical fiber will reach 30,000 to 40,000 kms, he noted.

Talking about measures to check quality of service, Dr Yaseen pointed out that the PTA has installed state-of-the-art equipment for this purpose.

‘We are carrying out a survey to assess the quality of Internet service providers on a daily basis, and on the basis of our findings, we are suggesting them about corrective measures,’ he said.

Dr Yaseen pointed out that billions of rupees have been collected by USF Company for laying network lines by the operators.

Under the agreement, all telecom operators are required to deposit 1 to 1.5 per cent of their revenue minus expenses with USF Company.

This company provides a subsidy from this amount to telecom service operators for laying a broad band network to unconnected areas in the country, he added.

So far, two districts, including Faisalabad, have been provided broad band facility while Multan would also be connected soon, he said. The PTA chairman said that the number of mobile phone subscribers has increased from five million in 2004 to 91 million in 2009 and fixed line users have grown from 3.7 million in 2004 to 4.5 million in 2009.—APP

DAWN.COM | Business | Telecom sector attracts huge foreign investments

 

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Benazir Tractor Scheme approved by Cabinet​

MUSHTAQ GHUMMAN


ISLAMABAD ( 2009-05-07 04:26:41 ) :The Cabinet on Wednesday approved the Benazir Tractor Scheme to provide 20,000 tractors to farmers at discounted rates, aimed at boosting the neglected agriculture sector. Presided over by Prime Minister Yousuf Raza Gilani, the Cabinet meeting deliberated upon the scheme, cleared by the Economic Co-ordination Committee (ECC) of the Cabinet.

Under the scheme, the government would share up to 50 percent of the cost of tractor, up to a maximum of Rs 200,000 per beneficiary. The farmers will be provided subsidised tractors through a ballot system. In Punjab, farmers owning 5 acres to 50 acres land, in Sindh and Balochistan farmers with 5 acres to 100 acres, and in NWFP, AJK and PATA farmers with land holding of 2 acres to 50 acres will be eligible to benefit from this scheme. Total cost of the Scheme will be Rs 10 billion and it would be implemented through Zarai Taraqiati Bank Ltd (ZTBL).

The Prime Minister directed the Ministry of Food and Agriculture (Minfa) to earmark special quota for Balochistan farmers. The meeting also approved amendments in terms and conditions of the Deep Sea Fishing Policy, approved during Musharraf regime. These include rationalising royalty and licence fee at the position of 1995, and declaring the federal area between 12-20 nautical miles (buffer zone) as Zone-II and from 20-200 nautical miles as Zone-III.

These measures are anticipated to bridge the yield gap through increasing productivity, enhancing investment, improving foreign exchange, rationalising the structure vis-à-vis neighbouring countries, thus achieving economic growth and increasing fishing vessels' operations in Zone-III.

Keeping in view the importance of Housing and Population Census for good governance and effective planning, the Cabinet approved, in principle, to hold Sixth Population and Housing Census "in a fair and transparent manner".

However, the Cabinet decided that the modalities to ensure transparency by taking all the stakeholders on board would be worked out in the inter-provincial meeting, to be chaired by the Prime Minister, which would be attended by the Chief Ministers, NWFP Governor, Prime Minister of AJ&K, and Chief Executive of Northern Areas. The Cabinet directed the Statistics Division to ensure effective monitoring of the process.

The Prime Minister, taking the Cabinet into confidence, apprised the meeting of the recent security situation in the country, with particular reference to the status of Swat agreement, Army action in Lower Dir and Buner, and relief activities for the internally displace persons (IDPs) in NWFP. The Prime Minister informed the Cabinet that the Army in certain areas of NWFP was called by the provincial government.

The Prime Minister said that the federal government had already sanctioned Rs 500 million for the provision of food and shelter as well as facilitating relief activities for the IDPs and, in addition, Rs 8 million has been granted for the provision of food items on emergency basis for the IDPs through Utility Stores Corporation (USC) from their regional set-up at Peshawar.

He said that the NWFP government has been directed to mobilise its financial and physical resources to provide immediate assistance to IDPs till their return to their areas after the restoration of peace. The Prime Minister informed the Cabinet that the government would soon invite Imam-e-Kaaba to visit Pakistan and preach the true face of Islam, which strongly abhors suicide bombings indiscriminately killing the people.

In order to enhance relationship between National Institute of Defence Studies, Japan, and National Defence University of Pakistan, the Cabinet approved, in principle, to start negotiating an MoU between the GoP and Japan. Under the MoU, students and faculty members of both universities will undertake visits on reciprocal basis, exchange information on current issues, and may conduct joint research projects.

The meeting approved to start negotiations for an agreement on economic and technical co-operation with Egypt. The agreement is aimed at promoting co-operation among companies, public works sector and private sector of both the countries in establishing joint ventures, and encouraging mutual investments in both the countries.

This will also include granting scholarships in economic and technical fields on reciprocal basis. To further cement socio-economic and political relations with the Government of Cuba, the Cabinet gave approval for signing of an agreement between Pakistan and Cuba for establishment of 'joint economic commission'.

Under the agreement, both sides will undertake feasibility studies to identify viable investment projects, exchange of specialists, granting of scholarships in specialised studies, etc.

The Cabinet granted ex post facto approval for initiation of negotiations and approval for signing of MoU with Germany on co-operation regarding Clean Development Mechanism (CDM) project activities. CDM, introduced under the Kyoto Protocol, is a market-based mechanism that helps the developing countries in achieving the goal of sustainable development by reducing greenhouse gases and earning foreign exchange by sale of certified emission reductions generated through their projects to mitigate the climate change effects.

The MoU also covers areas of co-operation in the fields of climate change, exchange of information and transfer of environment-friendly technologies for renewable energy and energy efficiency. The Cabinet approved, in principle, to start negotiations for signing of visa abolition agreement with Ukraine for holders of diplomatic and official passports.

In order to strengthen international law enforcement co-operation at all levels in combating illicit trafficking of narcotics, psychotropic substances and their precursor chemicals, the Cabinet approved to initiate negotiations for an MoU with the governments of Australia and Libya. The Cabinet also ratified the decisions taken by the ECC on March 19, 2009.

AAJ TV : Pakistan Ki Awaz

 

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Wheat production expected to be around 25.7 million ​

Thursday, May 07, 2009
By Aftab Maken

ISLAMABAD: Wheat production is expected to be around 25.7 million tonnes crossing government estimates of 23.3 million tonnes.

The increase in wheat out put estimates is being attributed to rise in both the area under wheat cultivation and per acre yield, reveals a survey on Wednesday.

The area under wheat cultivation was up by 9.8 per cent against the last season while per acre yield increased by 19 per cent over last year.

The increase in Guaranteed Minimum Price (GMP) of Rs950 per 40 kg for wheat encouraged growers to enhance wheat production, says the joint survey of Punjab Lok Sujag and South Asia Partnership-Pakistan.

The survey interviewed 956 farmers from 168 villages of 14 districts, which contribute half of the wheat production in Punjab.

The survey also pinpointed the massive production has become an insurmountable challenge for the government’s wheat procurement departments that now find themselves over stressed with the burden of buying the produce.

The smaller as well as large farmers during the on-going harvesting season in Punjab have witnessed an average increase in production of 30.6 per cent when compared with the corresponding period of last season, the survey added.

Only two of the survey districts, Narowal and Toba Tek Singh, showed a negative trend as area under wheat reduced here. Narowal also had to face a decline in yield as weather in the area has not been favourable resulting in an overall decline in production.

Toba however compensated the reduction in the area by better yield to produce more wheat than the previous year, the survey highlighted.

In contrast many other districts have thrived on the back of high yield alone. Attock increased area under wheat by only 1.8 percent, yet a high increase of 28 percent in yield resulted in increased production.

Lodhran surpassed all other districts in rise in yield as the per acre wheat production in the district rose by a hefty 57.6 percent, it said.

The survey further said that rise in wheat production in Okara was mainly contributed by a big increase in area under wheat. Okara and adjoining areas is the hub of potato production that failed to fetch a good price in the previous seasons. This coupled with the ensured high price for wheat wooed a number of farmers to replace potato with wheat. An additional rise in yield resulted in the big increase of 52 percent in wheat production in Okara.

Small farmers have been afraid that it might become difficult for them to buy wheat for home consumption at high rates at any point in the coming year. While medium and large farmers realised that wheat cultivation has become a profitable activity for the first time ever. They abandoned other cash crops performing poorly at the market and opted to grow wheat, the survey concluded.

 

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TDAP devises strategy to boost exports by 20pc ​

Thursday, May 07, 2009
By Mansoor Ahmad

LAHORE: Pakistan’s exports are currently under pressure because the easy money that came into the country after 9/11 was spent on importing cornflakes, chocolates and other goodies instead of building capacity of economy.

Trade Development Authority of Pakistan Chief Executive Syed Mohibullah Shah stated this while briefing members of the Lahore Economic Journalists Association on how Pakistan could meet the challenges of global economy.

He said the trade imbalance could not be corrected solely by increasing exports. It had to be supported by measures that curb unnecessary imports.

In October 2008, he said, the TDAP recommended to the federal government to take some measures including increase in tariff to discourage imports of 360 items which were an unnecessary burden on foreign exchange. “Pakistan could curb these imports while staying within World Trade Organisation (WTO) rules.”

He said the TDAP had chalked up a strategy to broaden the export base both in terms of area and products and achieve a 20 per cent increase in exports. However, he cautioned the TDAP alone could not meet the target unless there was a linkage between investment, trade and industrial policies.

Currently, he said, the country lacked essential ingredients for a sustained growth. “There is a need to liberate creative powers of entrepreneurship in the society through social sector reforms. The enabling power of education and skills is necessary to increase productive capacity of society.”

Shah said the protective power of governance was another reform to unleash the true potential of economy as it provided a level-playing field for all and ensured that rights and rewards were not usurped by the powerful.

The TDAP chief executive said the countries that undertook these reforms had outpaced Pakistan. Citing an example, he said in 1951 exports from Pakistan amounted to $160 million while South Korean exports were one-third of that at $60 million. Last year (2008), Pakistan’s exports were below $20 billion while exports from South Korea reached $400 billion.

In another example, he said in 1981 exports from both Pakistan and Turkey were worth $2.5 billion each. However, in 2008 Turkish exports jumped to $120 billion against $20 billion from Pakistan.

Shah said in the past six years exports from Pakistan grew at an average rate of 13.73 per cent while imports grew 25.71 per cent. Only five items accounted for 80 per cent of exports while 54 per cent of exports went to the US and European Union, he added.

In order to broaden the export base, he said, the TDAP had identified three sectors which were agro-based products, minerals and human resource. For expansion of geographical reach, the new regions identified by TDAP were Russia, Central Asian Republics, Iran, China, South Korea and South Africa.

By focusing on these sectors and regions, he said, the TDAP hoped to increase exports by 20 per cent annually. “The strategy is based on unexploited potential of these sectors.”

Elaborating his point, Shah said “Pakistan is the fourth largest producer of milk in the world but is ranked 33rd in exports, in meat production it is ranked 15th but 53rd in exports and fourth largest producer and third largest consumer of cotton but 33rd in clothing exports.” Exports in these sectors, he added, could be multiplied with little facilitation. He pointed out that explored and unexplored mineral reservoirs in Pakistan were double than that of India but mineral exports were negligible.