ECONOMIC TIMES OF PAKISTAN
Revenue shortfall widens to pkr 228 bn in Jul-Feb fy19
The Federal Board of Revenue (FBR) has reported a record interim shortfall of Rs228 billion in revenue collection in first eight months (Jul-Feb) of current fiscal year 2018-19. The shortfall came despite FBR’s drastic measures to enhance tax collection. The revenue authority failed to meet its tax collection target for February with shortfall in the month at Rs38 billion. The amount was nearly twice the shortfall of Rs22 billion in the same month of previous fiscal year. According to FBR sources, the interim statistics revealed that net revenue collection for the first eight months of the current fiscal year stood at Rs2,337 billion. Despite being Rs76 billion higher than the collection of Rs2,259 billion in the first eight months of FY18, the revenue receipts were Rs228-billion short of the FBR’s projected collection of Rs2,565 billion for Jul-Feb FY19. In February 2019, the FBR collected Rs272 billion compared to the target of Rs314 billion.
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Singapore delegation visits Pak to look for investment avenues
Last year, Singapore’s total trade volume with the rest of the world stood around a whopping $800 billion. But bilateral trade between Pakistan and Singapore is hovering around just $2 billion. That number, however, may change as a 21-member business delegation from Singapore is currently on a visit to Pakistan to explore investment opportunities. Shamsher Zaman, who is non-resident Ambassador of Singapore to Jordan, is leading the delegation. Besides being an ambassador, Shamsher is a member of the Singapore Federation. He is also chairman of the Middle East Group and vice chairman of the South Asian group. Shamsher is also the managing director of Linkers (Far East) Pte Ltd, Singapore – a global player in the supply of industrial chemicals and polymers, which are raw material for various industries. He was awarded The Entrepreneur of the Year Award and his company has also been conferred with several other most prestigious corporate awards and accolades including the Enterprise 50 Award.
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Bank A/C facility for refugees to aid economy
In a surprise move, Pakistan has allowed registered Afghan refugees to open and maintain bank accounts in a bid to make them part of the formal economy as they have remained associated with different businesses and professions for decades.
The State Bank of Pakistan (SBP) notified on Thursday that the Afghan refugees, registered with the National Database and Registration Authority (NADRA), can open bank accounts through biometric verification. Bankers and businessmen expressed their surprise over the development. They said they had raised no such demand, but welcomed the move, saying the decision would help bring a significant amount of money to the banking system and formal economy, which had earlier remained outside of the system due to lack of banking services to them. The move would also help the government collect taxes from such businesses and help crush the illegal Hawala and Hundi system, which the unbanked people mostly use to make financial transactions. The central bank has also linked the move with mitigating the risk of money laundering and terror financing.
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Pak asks Iran to lift curbs on transit permits
Pakistan has asked Iran to lift restrictions and resume the issuance of transit permits for transportation of Pakistani goods via land route to Russia, Central Asian states and Middle Eastern countries. Iran had stopped issuing transit permits three to four years ago for Pakistani goods like fodder, wheat straw, carrot and garlic for export through the Islamic republic to Russia, Kyrgyzstan, Iraq, Bahrain, Oman and the United Arab Emirates (UAE). Minister for National Food Security and Research Sahibzada Mehboob Sultan took up the matter with Iran Ambassador Mehdi Honardoost in a meeting on Thursday. Products from Balochistan had earlier been exported through the shortest land route via Iran, but due to curbs on the issuance of transit permits to Pakistan, the goods exporters were later forced to ship cargo via sea. However, the sea route is expensive and cumbersome, discouraging some exporters.
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SBP reserves drop $6mn to stand at $8.04bn
The foreign exchange reserves held by the central bank decreased 0.08% on a weekly basis, according to data released by the State Bank of Pakistan (SBP) on Thursday. Earlier, the reserves had spiralled downwards, falling below the $7-billion mark, which raised concern over Pakistan’s ability to meet its financing requirements. However, financial assistance from the United Arab Emirates (UAE) and Saudi Arabia helped shore up the foreign exchange reserves. China and the UAE have agreed to provide more cushion for the fast depleting reserves. On February 22, the foreign currency reserves held by the SBP were recorded at $8,036.8 million, down $6 million compared with $8,043 million in the previous week. The SBP cited no reason for the decline in its report. Overall, the liquid foreign currency reserves, held by the country, including net reserves held by banks other than the SBP, stood at $14,815.8 million. Net reserves held by banks amounted to $6,779 million.
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Additional steps in budget for ease of doing business
Finance Minister Asad Umar said on Thursday that the government had taken steps for the ease of doing business and was facilitating both domestic and foreign investors by offering various incentives including rationalisation of taxes. Talking to a visiting Singaporean business delegation, Umar revealed that more such steps were envisaged in the new budget for the upcoming fiscal year 2019-20. He told the delegation that Pakistan held Singapore in high esteem and welcomed investment by its businessmen in different sectors, assuring them of all-out support and facilitation. Speaking on the occasion, delegation leader and Middle East Business Group Chairman Shamsher Zaman said Singapore businessmen were encouraged to invest in Pakistan who saw the resolve and eagerness of the government to facilitate foreign investors. He said Singapore currently had a huge trade volume in which Pakistan’s share was very insignificant. He underlined the need for making efforts to promote trade and business linkages between the two countries. The delegation expressed keen interest in investing in infrastructure, information and communications technology, health care, airport and port management and other sectors.
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Chairman Khurram stresses need for targeting non-traditional markets
Pakistan needs to explore export-boosting avenues by diverting focus towards non-traditional markets in order to achieve a sizable growth in exports. “It is vital for Pakistan to broaden its export base in a bid to achieve growth targets and rein in trade deficit,” said Pakistan Textile Exporters Association (PTEA) Chairman Khurram Mukhtar in a statement. Terming the increase in exports essential for improving the economy, he was of the view that textile exporters were making strenuous efforts to achieve the objective. “Export diversification has played an important role in the economic development of various countries,” Mukhtar pointed out. “Therefore, export growth and diversification are considered engines of economic expansion.” Quoting figures, he lamented that the share of Pakistan’s exports in the global market was merely 0.13% as it highly depended on traditional markets. “Reasons behind this were global recession, high cost of doing business and lack of diversification in export products and markets,” he said.
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Cabinet body approves energy division’s proposals
The Cabinet Committee on Energy (CCoE) approved proposals from the Power Division for all future renewable energy investments to be treated in line with the Renewable Energy Policy 2019. The policy envisages a framework consistent with the current international market norms and greater consumer benefits. In the meeting, chaired by Finance Minister Asad Umar on Wednesday, the Power Division informed that the draft for RE Policy 2019 was currently in circulation for comments by stakeholders and would be presented to the CCoE as soon as such comments were finalised. All projects which have been granted Letter of Support by Alternative Energy Development Board (AEDB), shall be permitted to proceed towards the achievement of their requisite milestones as per the RE Policy 2006. However, in cases where more than a year has elapsed since determination of tariff by the National Electric Power Regulatory Authority (Nepra), their tariff would have to be reviewed by the regualtor as per policy.
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Spain keen to support Pakistan by technology transfer
The Spanish ambassador is set to visit Faisalabad next month to evaluate brewing opportunities in the wake of the China-Pakistan Economic Corridor (CPEC) to enhance bilateral trade between Faisalabad and Spain. Faisalabad Chamber of Commerce and Industry (FCCI) President Syed Zia Alumdar Hussain met with Spanish Ambassador Manuel Duran to discuss various issues related to bilateral trade. The Spanish ambassador acknowledged the importance of Faisalabad in the economy of Pakistan and termed it a city hard to be ignored because of its excellence in textiles. “Spain is ready to support Pakistan by transferring latest technology for upgrade of its existing industrial units in addition to processing its agriculture produce,” he added. Hussain highlighted that predominantly Pakistan was an agro-industrial country and was listed among top countries known for production of milk and meat in addition to the rest of agriculture produce. Noting that Pakistan exported raw or semi-finished goods despite its production edge, he stressed that the country needed latest technology to produce finished products to cater to the needs of the developed world. Voicing hope that Spain would support Pakistan in technology transfer, the FCCI president invited Spanish ambassador to the chamber for personally evaluating its export potential in addition to interacting with local business community. Furthermore, he floated a proposal to send a trade delegation to Spain so that direct relations could be cultivated between the business communities of the two countries.
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1st private sector transmission line achieves financial close
First high voltage direct current (HVDC) transmission line project of Pakistan, which will be 878 kilometres long, extending from Matiari to Lahore, has achieved a financial close. The project entails an investment of $1.658 billion. This was announced on Wednesday at a signing ceremony held at the Power Division. The documents were signed and exchanged by the Private Power and Infrastructure Board (PPIB) Managing Director Shah Jahan Mirza and the Chinese company’s Chief Executive Officer Wang Bo. This HVDC transmission line project is being developed under the framework of the China-Pakistan Economic Corridor (CPEC) agreement, and is another landmark achievement surfaced as a result of the efforts and facilitation of PPIB, Power Division, NTDC and other stakeholders. It is not only the first HVDC transmission line project in Pakistan, but also the first private sector transmission line project facilitated by PPIB, under the government of Pakistan’s Policy Framework for Private Sector Transmission Line Projects 2015. China Electric Power Equipment and Technology Company Limited (CET), which is a subsidiary of State Grid of Corporation of China (SGCC) is the main sponsor, responsible for execution of the project through formation of a special purpose company, including Pak Matiari-Lahore Transmission Company (PMLTC).