Pakistan Economy - News & Updates

[Omar1984]

KSE gains 151 points on foreign buying ​

KARACHI: The uninterrupted inflow of foreign funds kept the Karachi bourse set on upward track this week. The local financial institutions were more cautious and took to profit-selling on lucrative margins.

The KSE 100-share Index rose 151.30 points or two per cent on weekly basis and settled at 7,872.23 points. The parallel running junior 30-Index surged 147.27 points or 1.8 per cent and finished week at 8,343.20 points.

“The release of the third tranche of IMF standby loan of $840 million and approval of an additional $3.1 billion loan may help the market to cross the 8,000 points level smoothly in short term,” said M. Sohail at Topline Securities.

The decision would strengthen rupee against the dollar on temporary basis, which would help limit the twin deficits making the market attractive during the result season, analysts opined.

Next to the IMF loan, the Monetary Policy Statement of central bank is likely to effect the trading on the bourse. Any change in discount rate will impact market accordingly.

One big surprise for the market during the week was the aggressive buying by offshore investors. According to the latest numbers released by NCCPL, net foreign buying stood at US$19.14 million during the week.

This is the highest weekly net inflow witnessed by the market in last 15 months - since the week ended on April 25, 2008, reported Bilal Qamar at JS Research.

Though the received foreign funds at local bourse was mere 3.3 per cent of the total invested money in the market during the week at Rs45 billion, but the continuous inflow of overseas investment maintained market sentiments bullish this week, commented another analyst.

With net Rs45 billion investment at bourse this week, the overall market capitalisation surged to Rs2,323 billion.

Accordingly, the average turnover of the week recoded at 134.5 million shares, which is 12.6 per cent higher than 119.4 million shares of last week.

A section of analysts, including Hasnain Asghar Ali at Aziz Fidahusein, doubted the source of inflow of foreign funds and expressed that they might be locals who were injecting their black money into the market through some international channels.

Sharp rally in oil prices attracted investors’ interest in Exploration & Production (E&P) and other energy stocks. As a result, market capitalization of E&P and Oil Marketing Company (OMC) sectors rising by three per cent & 4.4 per cent, respectively, said Qamar.

KASB added that Independent Power Producers (IPPs) also rallied on possible resolution of circular debt within a month. During the week, above-expectation annual results triggered rally in Lucky Cement (EPS Rs14.2 and DPS Rs4.0) however APL results (EPS Rs53.5 and DPS Rs25) surprised the market negatively. Concerns on politically directed lending by National Bank of Pakistan (NBP) triggered selling pressure in the stock that shed 4.7 per cent of its value, despite support by value hunters towards the end of the week.

“The upcoming week would witness release of some blue chip results such as MCB, PSO, Hubco and OGDC. We believe, together with the decision of the IMF board meeting, these results would set the tone for the market next week,” added Qamar.

Rise in international oil prices near to $76 in London trade, rebound in rupee fall & continuing foreign interest in the market played a catalyst role in positive activity, added Ahsan Mehanti at Shahzad Chamdia Securities.

Dreamworld, Royal Bank, PICT, Allied Rental Modaraba and Standard Chartered Bank were major gainers while PIA, WorldCall Telecom, Nakshbandi Industries, Pakistan Services and National Bank were major losers at the KSE this week, according to KASB.

Movement in Weekly Volume Leaders

Symbols Opening on Close on Difference

Monday (Rs) Friday (Rs) (Rs)

Adamjee Ins. 104.18 102.84 -1.34

AH Securities 28.22 30.47 2.25

Azgard Nine 24.82 26.04 1.22

DGK Cement 36.35 38.89 2.54

Fauji Cement 8.42 8.42 0

JS Company 24.69 24.98 0.29

Lucky Cement 73.16 77.02 3.86

National Bank 68.95 63.32 -5.63

Nishat Mills 40.12 42.35 2.23

O.G.D.C 86.94 90.18 3.24

P.T.C.L 17.16 17.61 0.45

Pak Oilfields 164.12 168.44 4.32

 

[BATMAN]

Corruption eats up Rs195bn in Pakistan

Tuesday, August 11, 2009
By Mansoor Ahmad

LAHORE: Corruption level has remained high in Pakistan despite some improvements made in 1997 and 1998, the year when transparency hit its highest levels. Earlier in 1996, Transparency International declared Pakistan the second most corrupt country in the world.
Though it is no more the most corrupt nation in the world, it remains one of the most corrupt. Corruption in Pakistan has been viewed by many global monitoring agencies with grave concern.

The World Bank, in its latest report, says that corruption is largely associated with business-government interface and reveals that the menace is more widespread in Pakistan as compared to other countries.

Referring to a survey conducted for preparing a draft report, the Bank says results show that perceptions about corruption in Pakistan are based on actual experiences with payment of bribes by investing firms. It reveals that firms making investment have to pay bribes even to get water, telephone and electricity connections.

The National Corruption Perception Survey 2009, conducted by the Pakistan chapter of Transparency International, indicates that overall corruption increased from Rs45 billion in 2002 to Rs195 billion in 2009. Police and Power maintained their ranking as the top two most corrupt sectors in the country.

According to US-based Heritage Foundation, corruption is perceived pervasive in Pakistan. Corruption among executive and legislative branch officials is viewed as widespread. The Foundation in its Economic Freedom Index 2009 labeled corruption as the most repressive factor in economic freedom.

The Corruption Perception Index of Transparency International is given weight by all global agencies like the World Bank, Heritage Foundation and the World Economic Forum. When Pakistan was declared the second most corrupt country in the world by TI in 1996, it caused uproar in the country which created some awareness of corruption and measures were taken to improve governance.

The transparency score of the country improved from one out of full score of 10 in 1996 to 2.53 in 1997. The score improved further to 2.7 in 1998, which proved the highest level in the following decade.

During the much-trumpeted period of better governance under Musharraf, the highest transparency score achieved by the country was 2.6 in 2002.

Thereafter, the score declined to 2.1 in 2004 and 2005. It, however, improved to 2.5 in 2008. Governance experts point out that even at transparency score of 2.7, Pakistan remained a highly corrupt country as non-transparency or corruption was 73 per cent. At current transparency score of 2.5, corruption stands at 75 per cent.

“This is pathetic,” said senior economist Naveed Anwar Khan. In other words, he said “it means that on every Rs100 we spend on development, almost Rs75 are lost in corruption. If corruption is curbed we will need one-fourth of our development budget for the current annual development programme.”

He said the transparency score of India and Pakistan was at almost the same level in 2002. However, India improved governance by 30 per cent to attain a score of 3.4 in 2008 while China which was at Pakistan’s level in 1997 improved its score to 3.6.
That, he added, explained the great leap the economies of these two countries had taken compared with the decline in Pakistan. He said corruption during the last 12 months had increased substantially which would be reflected in the Corruption Perception Index of TI for 2009.

 

[Spring Onion]

MCB Bank to Acquire RBS Pakistan for $87 Million


By Naween A. Mangi

Aug. 12 (Bloomberg) -- MCB Bank Ltd., Pakistan’s biggest lender by market value, agreed to acquire Royal Bank of Scotland Group Plc’s Pakistan unit for about $87 million to increase branches and its expertise in financial transactions.

MCB Bank will buy 1.7 billion shares, or a 99.4 percent stake, at 4.22 rupees apiece before making an offer for the remainder, the company said in a statement to the Karachi Stock Exchange today.

The assets will help MCB tap growth in a nation that forecasts an economic revival for the fiscal year that started July 1. Pakistan’s economy may expand more than 6 percent annually on average over the next five years, Shaukat Tarin, adviser to Prime Minister Syed Yousaf Raza Gilani, said in March.

“MCB has been wanting to get more aggressive in consumer banking; this will allow them to do that,” said Raza Jafri, an analyst at AKD Securities Ltd. in Karachi. “RBS sold at distressed multiples because it wanted to get out.”

RBS, based in Edinburgh, is selling or shutting businesses in two-thirds of the 54 countries in which it operates after posting the biggest loss in British corporate history last year. Australia & New Zealand Banking Group Ltd. agreed to buy its businesses in countries including Singapore on Aug. 4.

MCB Bank’s shares, up 62 percent this year, climbed 2.4 percent to 175.75 rupees at 10:38 a.m. on the Karachi Stock Exchange. RBS Pakistan, which has gained 35 percent during the past month, rose 5 percent, the daily limit, to 22.10 rupees.

Internal Funds

Bank of America Corp.’s Merrill Lynch and KASB Securities Ltd. advised MCB on the transaction. Morgan Stanley advised RBS.

The transaction will be through internally generated resources, MCB said, without providing details.

The purchase of RBS Pakistan, which has 75 branches in 24 cities, will expand MCB’s network of outlets to 1,139, according to the statement. RBS had assets worth 108 billion rupees ($1.3 billion) as of Dec., 31, 2008.

“As a result of this transaction, I am confident that MCB’s position has been strengthened to deliver on our growth plans,” Chairman Mian Muhammad Mansha said in the statement.

Pakistan’s JS Bank Ltd. and Egypt’s Orascom Telecom Holding SAE were also interested in buying RBS Pakistan, according to statements to the stock exchange.

AKD’s Jafri estimated MCB may close as many as 15 RBS branches, which overlap with existing MCB outlets. He also forecast job cuts at RBS Pakistan, saying MCB has an average employee-to-branch ratio of 10, while for RBS it is 20.

There have been eight acquisitions of Pakistani banks since 2002, with the biggest being Standard Chartered Plc’s purchase of Union Bank Ltd. for $487 million in September 2006.

MCB Bank said this week that second-quarter profit rose 1.6 percent to 3.63 billion rupees, or 5.24 rupees a share, from 3.56 billion rupees, or 5.16 rupees, a year earlier.

 

[Spring Onion]

Pakistan’s Trade Deficit Narrows 31.1% to $1.15 Billion in July


By Farhan Sharif

Aug. 11 (Bloomberg) -- Pakistan’s trade deficit narrowed by 31.1 percent in July as imports fell faster than exports.

The trade gap narrowed to $1.15 billion in the first month of the new fiscal year, from $1.67 billion a year ago, according to data posted on the Web site of the Federal Bureau of Statistics in Islamabad.

Overseas sales fell 20.8 percent to $1.49 billion, while imports fell 25.6 percent to $2.64 billion, according to the data.

Pakistan is seeking to boost exports to sustain growth in a country where the World Bank estimates two-thirds of the population of 160 million people survive on less than $2 a day.

Pakistan’s trade deficit narrowed 18.5 percent to $17 billion in the fiscal year ended June 30, from $20.7 billion in the previous 12 months, according to the statistics agency. Exports fell 6.7 percent to $17.8 billion and imports dropped 12.9 percent to $34.8 billion.

 

[Spring Onion]

25 billion textile export target for five years set: policy likely to be announced today
TAHIR AMIN
ISLAMABAD (August 12 2009): The government is all set to announce the first-ever textile policy on Wednesday (today) with export target of $25 billion for the next five years after its approval at the special meeting of the Cabinet to be chaired by Prime Minister, Yousuf Raza Gilani.

The textile policy would introduce a technology support fund through which mark-up subsidy on loans for the import of capital goods would be given to textile industry. Other initiatives would also be presented to the Cabinet and their approval would be sought, official sources disclosed on Tuesday.

Textile Investment Support Fund of Rs 40 billion had already been announced in the Budget 2009-10, of which 67 percent would be spent on textile and clothing industry for consolidation and value addition of the sector. Besides setting up of textile and garment cities, training institutes for human resource development would also be funded. Furthermore, the policy would also stress on utilities and setting up of labs and create human resource fund.

New policy measures are taken to diversify products and markets to enable exporters to move out of traditional markets and capture new ones. The Ministry of Textile (MINTEX) has proposed duty free import of raw materials, which are used in the manufacturing of special textile products, in the textile policy.

Sources said, "The term "Technical textile raw materials" covers items like fabrics used in the highly processed form. For example such materials are used in the manufacturing of aircraft seats." Sharing salient features of the new textile policy, the sources said.

"The major thrust of the Textile Policy will be to enhance domestic capabilities and capacities for efficient use of resources through skill development, technology up-gradation and provision of infrastructural facilities. Measures are also envisaged for diversification of fiber usage and mix."

In the new policy, it is proposed to hire foreign consultants to initiate technical textile projects and also for the training of manpower. Technical textile laboratory would also be established under the research centre. More than 80 percent of industry is working in unorganised sector and with the increase in global competition it has become the requirement of the day to operate in economies of scale and develop strategic partnerships for long term benefits.

The policy will focus on establishment of linkages among various textile sub-sectors, both upstream and downstream, by ensuring their healthy and harmonious development. Various integrated and related plans and programmes to be undertaken for the development of spinning, weaving knitting, hosiery, dyeing, finishing and the stitching industry on priority basis.

In the policy one of the prime objectives is to establish research centres/councils for every sector of the textile value chain. The councils will carry out product development, design development, cost effective operations, best operation practices and testing of the products. These research centres must be accredited with international research organisations so that there results can be accepted in international market.

To develop sense of ownership in the project and ensure smooth operations, MINTEX has developed the strategy of public-private partnership. MINTEX needs to develop comprehensive plans to create awareness in the textile industry on specific issues relating to policies, management, markets, new products, operations, compliance, and branding and supply chain management. This task may be accomplished by conducting series of workshops and seminars and creating platforms for awareness dissemination in the said areas.

Special incentives will be given to the units working on 85-15 female-male workforce ratio to solve the issue. Separate training institutes will be developed all across the country for ladies to enhance their skills in industrial stitching, sewing and garment manufacturing. Women will also be facilitated in renting out areas in garment city projects.

Technical textile would be promoted by inviting the internationally recognised companies to start manufacturing technical textile products in Pakistan. Under the new policy, there is a plan to help create model garment factories, introduction of a new scheme whereby a textile park would be declared special economic zone, setting up of a weaving city and formation of a textile research and compliance organisation.

It also includes audit of processing industry for efficient and economical use of precious chemicals, setting up of state-of-the-art textile laboratory at NTU Faisalabad, horizontal and vertical integration to balance textile value chain, specialised garment training institute for women, one-window facility for provision of required infrastructure and standardisation of machinery and equipment.

MINTEX will highlight the areas which require multiple subsidies ie effluent treatment plants, testing machines and quality monitoring machines etc. About half of industrial stitching machines are installed in cottage industry and they are short of skills to prepare quality products and increase their efficiencies.

By making apparel house, MINTEX would synergize its efforts and also provide them the opportunity to excel in international market. The yield of spinning industry will increase, which will take this sector out of the current crisis. The proposed policy would cater for the short, medium and long-term measures to increase production of cotton, improve value-added products, productivity and competitiveness of the textile sector.


Copyright Business Recorder, 2009

 

[Spring Onion]

$747 million record remittances received in July
RECORDER REPORT
KARACHI (August 12 2009): Workers remittances sent by overseas Pakistanis surged by 19.13 percent to a record $747 million during the first month of current fiscal year as compared to same period last fiscal year. Pakistani workers remitted a record amount of $747.22 million in July 2009 against $627.21 million in the same month of the last fiscal year (July 2008), showing a jump of $120.01 million.

The amount of $747.22 million includes $0.14 million received through encashment and profit earned on Foreign Exchange Bearer Certificates (FEBCs) and Foreign Currency Bearer Certificates (FCBCs). The previous highest amount remitted in a single month by Pakistani workers was recorded in March 2009, when an amount of $739.43 million was received. The inflow of remittances into Pakistan from almost all the countries of the world increased last month as compared to July 2008.

According to the break-up, remittances from UAE, Saudi Arabia, USA, GCC countries (including Bahrain, Kuwait, Qatar and Oman), UK and EU countries amounted to $159.32 million, $151.17 million, $150.13 million, $107.63 million, $71.23 million and $26.04 million, respectively as compared to the corresponding receipts from the respective countries during July 2008, ie $100.10 million, $133.26 million, $168.39 million, $105.31 million, $42.04 million and $17.07 million.

Remittances received from Norway, Switzerland, Australia, Canada, Japan and other countries during July 2009 amounted to $81.56 million as compared to $60.99 million during July 2008. The country received the highest-ever amount of over $7.811 billion as workers' remittances in the recently concluded 2008-09 fiscal year, beating the previous record of $6.451 billion received in 2007-08.


Copyright Business Recorder, 2009



Business Recorder [Pakistan's First Financial Daily]

 

[Jamshed]

ISLAMABAD: MOL Pakistan Oil and Gas Company B.V as an operator of Tal block announced on Monday discovery of oil and gas reserves of around 12 mmcfd gas and 430 bbls per day condensate.

According to a company announcement, MOL Pakistan Oil and Gas Company B.V as an Operator of Tal block along with joint venture partners Government Holdings (Private) Limited, Oil and Gas Development Company Limited, Pakistan Petroleum Limited and Pakistan Oilfields Limited announced that that hydrocarbons have been encountered in its exploratory well, Maramzai-1, which is being drilled in Tal block, located in NWFP Province of Pakistan.

In the Lockhart Formation, upper 75 meters of the drilled section produced around 12 mmcfd gas and 430 bbls per day condensate.

The discovery is made in the uppermost reservoir section of the well and drilling is continued to penetrate and test the lower potentially prospective zones.

The full extent of discovery from the well will be known once the well reaches the planned total depth during next 45 days.


Daily Times - Leading News Resource of Pakistan

 

[glomex]

Pakistan’s export share in world trade declines to 0.13%

Daily Times - Leading News Resource of Pakistan

KARACHI: The global share of Pakistan in export market is 0.13 percent, which was 0.21 percent in 1999. The exports dropped from $19.1 billion in 2007-08 to $17.8 billion in 2008-09, imports dropped from $40.4 billion in 2007-08 to $34.9 bill in 2008-09, according to the Federal Bureau of Statistics.

Agha Saiddain, Chairman Pakistan Tanners Association, said textile exports which are 54 percent of our total exports dropped from $10.6 billion to $9.60 billion, but alarming thing is that export of non-textile manufactured items has gone down from an already low figure of $5.83 billion in 2007-08 to $3.12 billion in 2008-09. Agha said on the other hand non-textile exports have gone up in all our competing countries specially in Asia, including China, India, Malaysia, etc.

It would have been better to announce a trade policy for the year 2009-10 with short-term measure with a five-year strategic policy framework. Short-term measures are required to face the challenges of global recession and abnormal security situation of Pakistan. The trade policy is silent about the road map as how to achieve these objectives and the major causes of back drop of trade policy are identified by the MOC as energy crises, low productivity and poor innovation, low value addition, lack of foreign investment, tax laws, lack of product and market diversification, he added.

He said, these terms look very impressive but what practical measures have been suggested to overcome these weaknesses are unidentified”. To overcome these weakness the government has come up with new creative idea under its name STPF (strategic trade policy framework) with fundamental principles laid down as growth with equity, creating opportunities for gainful employment, sound macro-economic frame work for poverty eradication, environmental protection, HR development, targeting private sector as engine of growth, focus on small agriculture. The government has been working on strategies of various industries such as leather industry where SWOG (strategy working group) has already finalised their strategy paper and recommendations forwarded to the authorities.

The leather goods export registered a decline of 30 percent during 2008-09, while India witnessed 27 percent increase in six months of 2009. The Ministry of Production, SMEDA and the consultants J E Austin have been discussing leather strategy with major players of leather sector for last two years, the trade policy should have moved forward from discussion to implementation.

The measures to be taken and claim that competitiveness of Pakistan will be improved from 101 to 75 are not clear in the trade policy.

He said the weak currency has direct impact on imports, which accelerate inflation in the country, and markup rate goes up. This is a vicious circle and only remedy is to boost exports through export friendly policies and monitor imports by discouraging import of luxury items having substitute in the country. At present our retail shops are filled with imported cosmetics, shoes, juices, electronics, toys, clothing, food and other non-essential items.

 

[Hyde]

Pakistan's foreign exchange reserves rise to $11.85 billion ​

KARACHI (August 14 2009): The country's foreign exchange reserves rose by $130 million in the week that ended on August 8 to $11.85 billion from $11.72 billion the previous week, the central bank said on Thursday.

The State Bank of Pakistan's reserves rose to $8.36 billion from $8.31 billion a week earlier, while reserves held by commercial banks also rose to $3.49 billion from the previous week's $3.41 billion, the central bank said in a statement.

 

[Hyde]

Internet in Pakistan to hit 22 mln by 2013​

ISLAMABAD: The Internet usage in Pakistan is likely to see three digit growth rate in next couple of years as it is being predicted that internet base would touch 22 million mark by year 2013.

Out of total base, 4.3 million users would be using broadband Internet.

According to officials on Friday, it was told that Pakistan Telecommunication Authority (PTA) was working in collaboration with educational institutes to get the new generation familiar with internet.

Internet is going to be the next growing industry in Pakistan specifically in a scenario when Universal Service Fund (USF) is putting massive efforts to take Internet to rural areas of the country.

The sources said there is still to cover a long distance, tele-density is merely 11 percent but experts are expecting good because there were only 133,000 Internet users back in 2000 and now around 18 million in Pakistan.

 

[white_pawn]

City Nazim launches over 26 development projects ​

KARACHI (August 18 2009): City Nazim Syed Mustafa Kamal on Sunday inaugurated and launched more than 26 development projects in various areas of city including 24 projects under Lines Area Development Package. On a very busy day, he inaugurated a cricket ground in Sector 11-E North Karachi and a family park in KBR Society of North Nazimabad. At night he inaugurated and laid foundation stone of more than 24 projects under Lines Area Development Package having a total cost of Rs 160 million.

The projects included Khurshid Begum Memorial Women Computer Centre-II at UC 9 of Jamshed Town, Shahzadi Afza Altaf Hussain Family Park and Asharam for Hindu Community in UC8 Jamshed Town. City Nazim also laid the foundation stone of 10 under construction development projects in UC8 Jamshed Town for which 70 percent of work was already completed.

These includes construction of road from Qasai Chowk to Tauheed Chowk, road from Tauheed Chowk to Preedy Street, road from Aik Minar Masjid to Qasai Chowk, road from 602 Military Workshop to UC Office, road from 40 Ground to Tanga Stand, CC Flooring of internal streets, laying of sewerage lines and other projects.-PR

 

[white_pawn]

Moody's ups Pakistan rating from negative to stable ​

Updated at: 1429 PST, Monday, August 17, 2009

LONDON: Moody's Investors Service said on Monday it has raised its rating outlook for Pakistan to stable from negative after the country received a bigger loan from the International Monetary Fund.

"The stable outlook was prompted by the recent augmentation of Pakistan's IMF program by $3.2 billion to more than $11 billion, and several ongoing policy and structural reforms" said Aninda Mitra, Moody's analyst for Pakistan, in a statement.

Moody's has a B3 rating on Pakistan's foreign and local currency debt.

 

[white_pawn]

Foreign investment continues at KSE ​

Updated at: 1838 PST, Saturday, August 15, 2009
KARACHI: Foreign investors continued to buy shares at the local capital market in this week as well.

The foreign investors, in the current week, made a net purchase of 18.4 million dollars worth of shares. According to KSE figures, the foreign investors took positions in shares amounting to 30 million dollars and out of which off-loaded shares worth 12 millions. Hence, they retained positions in stocks worth 18.4 millions.

Foreign investors continued to invest in the stock market for the sixth consecutive week.

 

[Ghazy]

At last some FDI is back in Pakistan . Good news for. May be death of Baitullah Mehsud is the reason.

 

[white_pawn]

Cement exports register big increase in July​

KARACHI: Cement export made a sudden jump during July, the first month of the current fiscal year (2009-10), to 1.160 million tons from 0.838 million tons recorded during June 2009.

According to exporters, there had been around one million tons of exports for the last two years, but during July, the figure crossed the mark, indicating revival of cement demand in the world market.

However, cement export in June 2009 temporarily declined as India stopped providing rail wagons.

According to an understanding, both the countries were to provide train facility on the basis of inter-change which means one rail would go from Pakistan and the other would come from India to carry cement across Wagah border.

Cement export to India by sea route declined to 5,795 tons, but picked up in July and stood at 21,558 tons.

Similarly, export of cement to India by train during June was 38,560 tons but increased to 49,104 tons in July 2009.

Despite the fact that there was some decline in cement consumption by construction industry in India affected by slow economic activity, the on-going construction of Commonwealth games complex somewhat sustained demand of cement, exporters said.

But strong demand for Pakistani cement in Africa and Middle East helped increase exports.

Figures disclosed that around 0.742 million tons of cement was exported during July to African countries, like Sudan, Tanzania and Ethiopia, whereas exports during June 2009 stood lower at 0.504 million tons.

Afghan market has almost become a traditional market for Pakistani cement which started from 2001. During July, around 0.347 million tons of cement was exported to Afghanistan and around 0.289 million tons in June 2009.

Cement exporters have, however, lodged complaints with the government over the issue of two-way trucking.

Exporters said India was not allowing Pakistani trucks to enter their border area whereas on average around 100 trucks from India move into Pakistan daily with goods, such as onion, potato, vegetables and other goods.

The issue of two-way trucking was repeatedly taken up by the private sector with Indian officials and at the private sector trade bodies level, but standard reply had been security reasons from the Indian side.

Amjad Rafi, former KCCI president and a leading cement exporter to India, said if it was security reason, how come train loaded with Pakistani cement moves into their border area.

He alleged it is simply a non-trade barrier case which the government of Pakistan should take up at the highest level with India.

Cement is a non-traditional item. Its export to India began in July 2007. However, the government or for that matter the Trade Development Authority of Pakistan (TDAP) is not responding.

The new trade policy of 2009-10 did announce inland freight subsidy on cement, but so far no action had been taken to implement it, he said.

Mr Rafi said cement exports to India would be there for another year because the Indian industry was expanding their capacity rapidly.

He further stated that Pakistan Railways was also not cooperating and was making high charges of Rs600 per ton for a small distance of 30 km from Lahore to the border area.

The railways, he said, was also not giving sufficient number of wagons and last year only 50,000 tons were carried by them, whereas the industry needs 150,000 tons.

DAWN.COM | Business | Cement exports register big increase in July