Bumper wheat crop in Pakistan this year
The bumper wheat crop in Pakistan this year is seemingly becoming a nightmare for farmers as the market has crashed and growers are forced to sell the staple food crop much below the support price set by the government.
Since Punjab contributes more than 75 percent of the total wheat harvest, farmers of the province are frustrated and have announced a nationwide protest on April 25.
“We will not harvest wheat crop next year, if the exploitation of farmers continues, both from middlemen and the government,” remarked Kissan Board Pakistan Central Chairman Sardar Zafar Hussain Khan on Tuesday.
Muhammad Aurangzeb foresees $10bn reserves with IMF nod
Finance Minister Muhammad Aurangzeb stated on Tuesday that Pakistan’s gross official foreign exchange reserves would increase to $10 billion in two months, as the International Monetary Fund is set to approve the $1.1 billion final loan tranche on Monday. The minister also unveiled his strategy to avoid any future International Monetary Fund (IMF) programmes but only after obtaining a new “large and longer” 24th programme. His strategy revolves around enhancing exports, foreign direct investment (FDI), and raising debt from global markets – the three pillars that every finance minister has been attempting to implement during the past 16 years with varying degrees of success.
The finance minister also took a jab at his predecessor, stating that “no one can imagine a plan B with only 15 days of reserves” – in a veiled reference to former Finance Minister Ishaq Dar’s mention of Plan B in 2023 when the country was struggling to secure the IMF bailout package.
Aurangzeb spoke at the inaugural session of the 7th Edition of the “Leaders in Islamabad Business Summit” (LIIBS).
Gold plunges by 3pc to 18-day low
Gold prices dropped by slightly over 3 percent, or Rs7,800 per tola (11.66 grams), in a single day, falling to an 18-day low at Rs240,900 in Pakistan on Tuesday, reflecting global trends.
The commodity has seen a total drop of almost 5 percent, or Rs11,300 per tola, in the past two days compared to the all-time high of Rs252,200 reached on Saturday (April 20), according to data from the All Pakistan Sarafa Gems and Jewellers Association.
The significant correction in the global commodity market occurred after it shed 4.02 percent, or $102 per ounce (31.10 grams), in the past two days, reaching $2,309 per ounce on Tuesday.
Director of Interactive Commodities, Adnan Agar explained to source that the de-escalation of the Middle Eastern geopolitical crisis led global investors to opt for profit-selling. Although Israel retaliated against Iran, Tehran exercised restraint, resulting in reduced geopolitical tension in the region.
He noted that gold dipped to $2,290 per ounce during the day but rose back to $2,330 per ounce by evening in Pakistan.
Agar stated that the upcoming US Friday’s data on goods pricing would provide a new direction for the global commodity market going forward.
Energy sector needs new roadmaps
The chief executive officer of K-Electric (KE) has stressed that privatisation is the way forward to address the circular debt and formulation of clear long-term roadmaps can expedite the energy sector’s progress.
He stated this while speaking at a panel discussion on the way forward for Pakistan’s power sector at the 7th Leaders in Islamabad Summit on Tuesday.
The panel discussion was led by Federal Minister of Energy Awais Ahmad Khan Leghari, who said that privatisation was a key agenda of the government along with a holistic plan to ensure the stability and efficiency of the power sector in the interest of consumers.
KE CEO Moonis Abdullah Alvi acknowledged that Pakistan had low per capita energy consumption, but it provided an opportunity to draw up policies and roadmaps that could stimulate the economy and drive demand.
Alvi revealed that KE was receiving interest from various entities including international names for its 640-megawatt renewable energy projects, which was a positive sign and reflected the company’s vision to integrate renewables into the energy mix.
Former caretaker energy minister Muhammad Ali cited that minor interventions could have a huge impact, sharing an example of the use of high-efficiency appliances. Replacement of all fans, he emphasised, could result in savings of up to $1.5 billion per annum.
Ahsan: $3tr economy possible by 2047
Federal Minister for Planning and Reforms Ahsan Iqbal stated on Tuesday that Pakistan aims to achieve a $3 trillion economy by 2047. He highlighted the need for enhanced public-private collaboration and a streamlined regulatory framework. “Pakistan targets a 9 percent growth rate to realise this goal,” he said, underscoring the current favourable climate for international investments, with notable commitments from China and Saudi Arabia.
Iqbal, addressing the Leaders in Islamabad Business Summit 2024, stressed the pivotal role of government-private sector collaboration in driving economic growth. He advocated for the development of comprehensive ecosystems within business clusters to optimise value chains and promote sustainable value addition. Drawing parallels with successful models from Japan, Korea, Singapore, and Malaysia, he emphasised the need for trading houses to facilitate the global market integration of local products.
State Bank buys dollars to offset shortfall
Pakistan received $9.7 billion in foreign loans, or a little over half of the annual estimate, in the first nine months of the current fiscal year, as the government could not convince the international credit rating agencies to upgrade the country’s junk rating.
The current fiscal year may end without any major issuance of sovereign international bonds in western markets and acquiring new foreign commercial loans due to the poor credit ratings despite “successfully” completing the International Monetary Fund (IMF) programme.