Shahbaz Sharif is right in a point of view devaluing PKR from 130 to 155-168 had no impact on Export.

[Patriot forever]

Well, I've been wailing on this forum about the PML-N government's unjust deals when an average solar or wind energy plant in India produced electricity for 4-6 cents and 12-16 cents in Pakistan. Because these projects showed apparent signs of corruption, capacity payments were sure to rise.

However, we must keep in mind that one of the main reasons the PPP lost the 2013 election was their inability to find investors and implement power projects. They came with temporary solutions with corruption-laden projects, but nothing concrete. The PML-N, on the other hand, was able to attract investors, and the idea was similar to PTI's boasting on television that we should abandon expensive oil projects and invest in coal-powered energy projects because we have coal, despite the fact that the majority of us were unwilling to acknowledge that coal is not a viable energy source and that even those projects were very expensive in the long run, especially when compared to imported coal.

The truth is that we needed electricity, therefore whatever possibilities the previous government had, they took use of them. We know that WAPDA and Pakistani electricity companies predicted that demand for electricity would rise from 16,000MW - 18,000MW to 40,000MW in five years, so the projects were designed to secure the future. However, our economy and energy consumption did not grow as expected, and while there is still demand for electricity, line losses and a lack of transmission lines prevent us from expanding our range. In Pakistan, a sizable population still relies on generators, despite the fact that they could have simply utilised the government's electricity. Our electricity usage per capita is very low compared to other nations so there is always potential it will rise very quickly

To be honest as far as i remember that projection was for 2030 not in the next 5 years. Care to share the link?

It is imposible to double demand in 5 years, thats out of science fiction. The matter of fact is demand only grew about 20% in entire plmn 5 yeras that too just peak demand.

These expensive and flawed contracts are the reason. THE THEORY THAT I HAVE A SEEN A LOT PEDDLE AROUND IS THERE WERE NO OTHER OPTION IS ENTIRELY FALSE, WHEN PLMN BURNED AROUND 4-5B JUST IN THEIR LAST YEAR MANIPULATING CURRENCY.

I do not know whst to say but i think you are confusing what pti said with plmn. PLMN PLANTS ARE BASED ON IMPORTED COAL NOT LOCAL (Except for one plant 500MW that started production in late 2019). International coal prices at the moment have crossed $110.

 

[Xestan]

I guess the problem with this argument is that Asad Umar had no option, we were short of dollar and to keep the exchange rate stable, we needed to inject more dollars in the market. You can argue that the way rupee was made to fall, was disastrous, I mean a lot of economists including out current FM has said that too, but to say devaluation was overall avoidable, is wrong.

Miftah Ismail, who I consider to be a competent economist, realised the blunder Dar had committed and the devaluation process started during his time as the Finance Minister. There can be arguments about how it was handled, but it was inevitable.

 

[Patriot forever]

Now Imports are at 5.2 billion dollar per on regular bases. Import are going up only because of food items and leave alone machinery item at the moment ,which will pick up do TERF financing.

Yes with the market based rupee our imports become range bound, if imports increase rupee will further depreciate making imports more expensive that will lead to less imports. This is how market based currency acts as 1st defence line making sure our CAD remains in a reasonable range of 1-2% GDP.

A lot of people dont understand that remittances increase has a lot to do with market valuation of rupee aswell. The more value you get the more the money people send back.

 

[Hareeb]

So Shehbaz Shareef is now an economist too, lol.
With respect to exports and imports, after depreciation of currency, exports inputs can be acquired at low cost, as well as it makes imports expensive - net value of exports in real terms increase.

Well, I think someone who is alleged to have involved in white collar crimes should not be allowed to have opinions onatters of national interests.

 

[xyxmt]

Is Shebaz Sherif willing to give his stolen USDs in order to keep rupee high?

 

[bafxet]

So Shehbaz Shareef is now an economist too, lol.
With respect to exports and imports, after depreciation of currency, exports inputs can be acquired at low cost, as well as it makes imports expensive - net value of exports in real terms increase.

Well, I think someone who is alleged to have involved in white collar crimes should not be allowed to have opinions onatters of national interests.

PTI supporters blindfoldly follow their political affiliation, even if the GoP commits a mistake. You don't need a rocket science or an eminent economist to figure out that the huge devaluation of PKR was a wrong decision. It didn't enhance the exports at all.

The most pressing issue here is the re-brand of name 'Pakistan', which is tarnished badly because of terrorism and extremism.

In the order of merit next is being competitive and innovative. Followed by market access.

 

[Hyde]

To be honest as far as i remember that projection was for 2030 not in the next 5 years. Care to share the link?

It is imposible to double demand in 5 years, thats out of science fiction. The matter of fact is demand only grew about 20% in entire plmn 5 yeras that too just peak demand.

There are so many articles from 2013/14 predicting our energy demand to rise between 40,000MW to 50,000MW by 2022-2015. For example reuters reported 49,000MW by 2025

Pakistan ramps up coal power with Chinese-backed plants

With much of the world pouring investments into renewable and clean energy, Pakistan is drawing criticism for welcoming Chinese investment in coal-fired power plants as part of a plan to boost urgently needed generating capacity.

www.reuters.com

These expensive and flawed contracts are the reason. THE THEORY THAT I HAVE A SEEN A LOT PEDDLE AROUND IS THERE WERE NO OTHER OPTION IS ENTIRELY FALSE, WHEN PLMN BURNED AROUND 4-5B JUST IN THEIR LAST YEAR MANIPULATING CURRENCY.

I do not know whst to say but i think you are confusing what pti said with plmn. PLMN PLANTS ARE BASED ON IMPORTED COAL NOT LOCAL (Except for one plant 500MW that started production in late 2019). International coal prices at the moment have crossed $110.

I'm not making any mistakes. When the coal-fired plants were being installed, it was reported that imported coal-fired plants would be less expensive than those produced domestically. At the time, the argument was that we needed "coal-fired power plants" to replace our obsolete furnace oil based plants

 

[Imran Khan]

یہ شبازا کنجر وہی ہے نا جسکے بھائی نے اپنے سمدھی منشی ساقے ولد بودی سائیکلاں والے کو وزیر خزانہ بنا دیا تھا جو اپنی ہی حکومت میں ملک سے بھاگ کر لندن جا بیٹھا تھا ؟

 

[Patriot forever]

PTI supporters blindfoldly follow their political affiliation, even if the GoP commits a mistake. You don't need a rocket science or an eminent economist to figure out that the huge devaluation of PKR was a wrong decision. It didn't enhance the exports at all.

The most pressing issue here is the re-brand of name 'Pakistan', which is tarnished badly because of terrorism and extremism.

In the order of merit next is being competitive and innovative. Followed by market access.

The devaluation is proportional to how much the rupee was overvalued. There is no rocket science in it. It was done over a period of 1 year not over night.

Exports is due to lack of capacity and was further limited by electricity tariff increase.

It has help us brought CAD under control, increased remittances, and kick started import substitution ( in the construction sector it is the most evident).

It is basic economics, if you say our point of view is based on politics, care to name one country of significance that has grossly overvalued currency?

 

[TheSnakeEatingMarkhur]

Shahbaz Sharif is right in a point of view devaluing PKR from 130 to 155-168 had no impact on Export.

In my point of view we had no advantage for export in Pakistan. Only thing market base currency has bought is inflation and things for inflated.

FDI dropped massively as well, indirect tax increased as well and Asad Umar compromised CPEC contract sharing with IMF in 2019.

In my point of view, Asad Umar and Hafeez Shiek badly negotiated IMF program in the history Pakistan it has delayed for more than year now. Now again delayed to September just because it was very badly negotiated and Government has no experience how to deal with International lenders.

To bahi kya karain ? Artificially dollar niche rakhain ? Woh b qarze k pese se ?

 

[Jungibaaz]

It may have had a less than stellar impact on exports, but previous government’s policy was the opposite, burning reserves to keep PKR overvalued. They should learn mistakes rather than boasting about a blunder.

Given a choice between the current government’s policy vs prev policy. I’d pick the current one easily...

 

[Patriot forever]

There are so many articles from 2013/14 predicting our energy demand to rise between 40,000MW to 50,000MW by 2022-2015. For example reuters reported 49,000MW by 2025

Pakistan ramps up coal power with Chinese-backed plants

With much of the world pouring investments into renewable and clean energy, Pakistan is drawing criticism for welcoming Chinese investment in coal-fired power plants as part of a plan to boost urgently needed generating capacity.

www.reuters.com

I'm not making any mistakes. When the coal-fired plants were being installed, it was reported that imported coal-fired plants would be less expensive than those produced domestically. At the time, the argument was that we needed "coal-fired power plants" to replace our obsolete furnace oil based plants

The first point is just an article. Even in 2018 that figure was laughable than in the next 3-5 years our energy consumption would double. That was never going to happen.
..


The argument that was used at that time was flawed because the cost of thar coal was calculated based on limited production at that time just to produce a few 100 MW of electricity not what the cost will be if we install thousands of MW, besides the internarional price of coal was low at that time ( we have debated this topic so much on this forum thar coal vs imported coal even taking into account the mmbtu factor). The main point in regard to thar coal was ECONOMY OF SCALE.

 

[bafxet]

The devaluation is proportional to how much the rupee was overvalued. There is no rocket science in it. It was done over a period of 1 year not over night.

Exports is due to lack of capacity and was further limited by electricity tariff increase.

It has help us brought CAD under control, increased remittances, and kick started import substitution ( in the construction sector it is the most evident).

It is basic economics, if you say our point of view is based on politics, care to name one country of significance that has grossly overvalued currency?

China kept its currency under valued, but than it achieved its objective of boosting exports. If it didn't happen in our case then obviously we can't say it was a right decision. The devaluation of Rupee was done to meet the condition of IMF.

PTI has been beating the drums that PMLn has left the economy in shambles because of a staggering trade deficit of USD 30 billion. Here we are after 35% devalution more or less the similar amount of deficit is expected. Means we back to square one but with a Rupee with lesser value of 35% against USD.

 

[BATMAN]

Shahbaz Sharif is right in a point of view devaluing PKR from 130 to 155-168 had no impact on Export.

In my point of view we had no advantage for export in Pakistan. Only thing market base currency has bought is inflation and things for inflated.

FDI dropped massively as well, indirect tax increased as well and Asad Umar compromised CPEC contract sharing with IMF in 2019.

In my point of view, Asad Umar and Hafeez Shiek badly negotiated IMF program in the history Pakistan it has delayed for more than year now. Now again delayed to September just because it was very badly negotiated and Government has no experience how to deal with International lenders.

 

[RIP Pak LAW]

I believe that Shaukat Tareen's appointment as Finance Minister, despite his historical criticism of the government for depreciating the PKR, is an admission that the decision to depreciate the Pakistani Rupee by 30-40% was a mistake.

Under Shaukut Tareen dollar has gone up from Rs 153 to Rs 157. Just saying.