Pakistani Economic Stress Watch

[Paul]

Ali Kamran Chishti ‏@akchishti 6m6 minutes ago
why are all these airlines ripping off passengers on air-fares @AirportPakistan? Rs.17-20K one way domestic is ripping off ppl.

[A_Gupta]

The condition of Pakistani railways:
http://www.brecorder.com/business-and-e ... 2015-08-04

[K Mehta]

X-posting here from tsp thread
CSF may not be possible beyond 2015: US

BAQIR SAJJAD SYED

ISLAMABAD: The United States has indicated to Pakistan that further extension in the Coalition Support Fund (CSF) beyond 2015 may not be possible.

The issue about the future of CSF, according to a defence source, was discussed at the 23rd Defence Consultative Group Meeting (DCG)-Interim Progress Review (IPR) held at the defence ministry on Tuesday. Principal Deputy Secretary of Defence Ms Kelly Magsamen led the US delegation comprising officials of the defence and state departments.

Under the CSF arrangement, the US reimbursed Pakistan for operations and maintenance costs incurred in direct support of its operations in Afghanistan. Since 2001, the US has reimbursed $13 billion to Pakistan, which is the largest recipient of the fund.

(Pakistan gets $336m in Coalition Support Fund, foreign reserves climb to $19bn)

The arrangement was supposed to end with the completion of the drawdown in December 2014, but the US government through legislation extended the programme for another year. The extended programme, which came with extra conditions, allowed reimbursement of up to $1bn.

At the DCG meeting Pakistan sought its further extension due to continuing challenges. Besides helping in meeting security expenses, the government has been using CSF inflows to narrow down current account deficit.

A source said the US unwillingness to continue the programme was because of its changing priorities as it appeared more focused on the challenges posed by Middle Eastern terror group Daesh.

Speaking at the forum, Defence Secretary retired Lt Gen Alam Khattak emphasised on the importance of Pakistan in the regional security and said: “Pakistan is at the frontline fighting for the stability of the region. … Pakistan’s armed forces are committed to flushing terrorists out of the area by continuing operation Zarb-i-Azb.”

Pakistan, according to the source, needs sustained assistance for continuation of operations as well as rehabilitation of the displaced people. About two million people have been displaced because of counter-militancy operations and they are now being rehabilitated at a cost of Rs100bn.

Rehabilitation of IDPs technically does not come under the activities mandated under the CSF, but Pakistani officials use this argument to strengthen their case for continuation of the programme.

Pakistan had in 2014 lobbied for conversion of the CSF into a ‘Stability Support Fund’ after changing some of its parameters. The US administration initially looked convinced about the proposal, but it couldn’t materialise due to Pakistan government’s failure to pursue the matter at the political level. Additionally, the source said, the US needed to realise that Daesh was also posing a serious threat to this region.

According to a defence ministry’s statement on the meeting, the US delegation agreed that Pakistan was a stabilising factor in the region following the drawdown of coalition forces and was contributing to efforts for peace in the region.

It said the participants of the meeting were hopeful that “outstanding issues related to defence cooperation between USA and Pakistan” would soon be resolved. But the statement did not say what the outstanding issues were.

Published in Dawn, August 12th, 2015

[K Mehta]

In the last page's heritage foundation's report, one small tidbit is interesting

For the last quarter of 2014, at least, the Pakistani government had met all the conditions set by the IMF, meeting performance criteria that included a Net International Reserves target, Net Domestic Assets target, reducing general borrowing, reducing borrowings for budgetary support from the SBP, and fulfilling the condition on debt-swap arrangements.[21] Some news reports contend that the reduced borrowings target was only met because the government borrowed from commercial banks instead of the SBP, which in turn facilitated the provision of loans to the government by those commercial banks through the injection of more money into the banking system—a strange sort of “reverse sterilization” process.[22] Thus it appears that the government of Pakistan essentially found—yet again—a round-about way of borrowing from the central bank while meeting its IMF Extended Fund Facility target.

Let me give you a brief desccription:
1. Earlier SBP printed money and baki governmund “borrowed” from them.

2. IMF made them stop this practice due to its inflationary nature by putting conditions for next backshish.

3. baki governmund starts borrowing money from private banks by borrowing as well as debt instruments like PIB etc at high rates of interest. Banks favour this way of steady risk free source of high interest.

4.governmund demand is huge and sucks out all money from banking system, reducing private sector borrowing and creating a “liquidity crisis”


From here
Govt borrowed Rs1.4tr from banks in FY15

The government borrowed Rs1.4 trillion from scheduled banks in 2014-15, while the private sector credit off-take fell by 44pc over the preceding year.

However, the government avoided to borrow from the central bank, which is inflationary in nature and also a condition for the International Monetary Fund loan. In FY15, the government retired SBP’s debt worth Rs462bn.

5. To overcome this “liquidity crisis” and to allow government to borrow more, SBP has been doing injection of liquidity by doing “open market operations”(OMO).


Injection of liquid oxygen

Open market operations help banks address their short-term liquidity shortages by letting them borrow from the SBP against their holdings in government securities.

6. So the same government securities which were bought by money borrowed earlier, are used to buy more government securities and so on.

7. This gives rise to a "Vibrant, thriving and dynamic" banking sector of bakistan, similar to the “improved” foreign exchange reserves brought about by foreign debt. This is a round about way of borrowing from SBP via banks.

More here

The banks like the idea of holding far less cash than they need to – since cash earns them nothing – and relying on the State Bank’s OMOs to cover their needs when they fall short. And the finance ministry likes this arrangement because it means that the banks have more money to lend to the government by buying Treasury bills and Pakistan Investment Bonds (PIBs).

And more

The banks have been running short of cash mainly because of massive investment in the government securities and lending to the government for budgetary support.

The SBP’s latest report showed the government borrowed Rs870bn from the scheduled banks in the first seven months (July-Jan) of this fiscal year, compared to just Rs103bn a year earlier.

The liquidity shortage has been increasing with each passing week; it rose to Rs623bn on Friday. The SBP injected the liquidity for another seven days.

Meanwhile, the State Bank announced that the government would borrow Rs1.05 trillion through market treasury bills during Feb-Apr. The government needs such a large liquidity to pay back the money it has borrowed through T-bills.

Monetary easing has substantially reduced the interest rate from 10pc to 8.5pc during the last four months which has threatened banks’ earnings from government papers.

The PIBs, however, are still very attractive for investors because of higher rates. During Feb-Apr, another Rs150bn will be raised through auction of PIBs. The coupon rates for three-year, five-year and 10-year papers are 11.25pc, 11.50pc and 12pc, respectively.

The baki governmund internal debt is huge and this kind of gimmick means it will spend even more for interest repayments. To keep up with this SBP has been injecting more and more money in the market. The number of OMO (open market operations) done by SBP have been increasing in amount and frequency as well.

[K Mehta]

Data on the Open market operations (OMO)s conducted by SBP.

Please note that the data is not complete and some links have been lost, but is a good indicator of trend.

All figures in PKR billion

October 12, 2012 608
February 8, 2013 600
in December 2013 241.1Link

August 9, 2014 59
in 2014 upto August 420.25

December 13, 2014 375 Link
December 20, 2014 585 Link
December 26, 2014 586.4 Link
January 3, 2015 513.1 Link
January 10, 2015 689 Link
January 20, 2015 526.6 link
February 14, 2015 623 Link
February 21, 2015 722 Link
March 20, 2015 842 Link
April ?, 2015 975
May 11, 2015 779 Link
June 27, 2015 668 Link
July 6, 2015 1490 Link
July 31, 2015 850 Link
August 4, 2015 70.5 Link
August 7, 2015 1091.2 Link

Please note that this is an incomplete list, compiled based on open source data available. The extent and frequency is probably higher than listed above. The amount injected has now reached to trillion PKR and will keep increasing.

[schinnas]

With all the OMO (with associated cyclical debt trap), it is a miracle Puki has money to buy billions of worth submarines from Cheen. With money supply reducing from Gulf Arab daddies and Uncle, will Cheen provide the maal for free?

[nachiket]

Why isn't injection of liquidity on this scale giving rise to huge inflation?

[A_Gupta]

Why isn't injection of liquidity on this scale giving rise to huge inflation?

Good question! I was wondering whether the Pakistani rupee would keep depreciating. Regarding inflation, I think - it is either inflation or scarcity. E.g., if electric power prices are controlled, then in the place of inflation (higher price for a given supply), scarcity (lower supply for the given price) will happen.

Some clues here?
http://www.thenews.com.pk/Todays-News-3 ... indicators

[Chandragupta]

Interesting bit of info I got from Tripadvisor of all places. The biggest cities of Pakistan - Karachi, La'Whore & Slum-a-bad have a sum total of less than 100 hotels listed on TA - 22,38 and 14 in that order. Compared to these shit Pakistani cities, just to put things into perspective, Aurangabad in MH - just a normal industrial town - has 49 hotels listed on TA with a Lemon Tree & Welcom Hotel (ITC) thrown in for good. Vadodara has 49 hotels with a Hilton group, ITC group & a Royal Orchid, all internationally renowned chains. Coming to Jaisalmer, which is a touristy town, it has 3 five star hotels and 86 others, so 89 in total.

Since these delusional Pakistanis think their cities are somehow equal to Indian cities, TA shows 319 Hotels with god knows how many 5 stars, in Jaipur; 401 Hotels in Mumbai and Bakis, hold your breath, 646 hotels in New Delhi. I'll let the peeking Paki lurkers count the number of 5 stars each of these cities have. And Bakis, while you're at it, check out Bengaluru, Kerala & Pune, Karnataka as well.

Ofcourse, we all knew that these swines had no tourism going on but what really surprised me was that all the higher ranking staff of all their decent hotels in all of shitistan (which I can count on fingers of 1 hand) are all foreigners - GMs, AGMs, Customer Care Managers, Head Chef, Sous Chef - all European or Amreekis. Native Bakistanis are no more than doormen & latrine cleaners in these hotels which cater to mostly IMF, UN, US Army/SD officials or who knows Blackwater guys there to kill or throw some alms to these beggars. They have absolutely ZERO inbound business travel.

[A_Gupta]

Somebody sees a business opportunity in the Pakistan tourism business!!!!
http://tribune.com.pk/story/915373/hote ... -industry/

[member_27845]

The PKR has been strengthening against the INR over the last 5 years - consistently
It is now around 1.55 to the INR as against 1.90 in 2011

http://www.xe.com/currencycharts/?from= ... KR&view=5Y


It just shows how much the INR has weakened against the USD ( an astounding 50% over the last 5 years ) , whereas PKR has only gone down by 25% against the USD over the same period

Foll is INR to USD over 5 years :

http://www.xe.com/currencycharts/?from= ... NR&view=5Y

[kmkraoind]

@Chandragupta. Pakis have perfected, North Korean model of showing only some highly decorative places as Pakistan. In fact, rest of that country is a "no go zone area."

While western outlets depict India (a free country, where they can roam freely at everyplace) as a poor.

[A_Gupta]

http://www.ft.com/intl/cms/s/0/67422228 ... z3jeUPMYDv
"Disdain over IMF’s rosy view of Pakistan"

Even by the easy-going standards of a club reluctant to offend its members, the International Monetary Fund was unusually kind in its latest assessment of Pakistan’s economic reforms.
.....
“In our close to 70 years’ history, we’ve never had a government that fudged statistics to the extent of this one,” says Hafeez Pasha, an economist and former finance minister.

[Falijee]

Pakistanis Pontificate Against Steady Fall Of Their Rupee Against US Dollar

Dollar crosses Rs104 in interbank market[*]

[*] Euphemism for saying that Pak Rupee has lost value

The news item/ readers comments discusses various reasons for the steady decline of the Paki currency, including increase demand of $ due to Hajj season, hoarding/ purchase by speculators, etc. Some readers recommend exchange control ( in this day and age of globalization and free trade!) while others blame the Govt of NS.
Pakistan should follow the example of other (financially troubled ) countries - do away with their rupee, and adopt the 'mighty' US Dollar as their national currency ( even if it hurts their Echendee)

[A_Gupta]

Actually, PKR has gone from 1.96 PKR = 1 INR to 1.55 PKR = 1 INR in the last 5 years.

[salaam]

Actually, PKR has gone from 1.96 PKR = 1 INR to 1.55 PKR = 1 INR in the last 5 years.

Last ten years of INR vs PKR

[A_Gupta]

Actually, PKR has gone from 1.96 PKR = 1 INR to 1.55 PKR = 1 INR in the last 5 years.

Last ten years of INR vs PKR

Thanks!

27 Aug 2005 00:00 UTC - 24 Aug 2015 15:42 UTC
INR/PKR close:1.55278 low:1.28368 high:1.96755

[K Mehta]

The reason for the abnormal strength of pkr is as below
Rupee weakens, officials divided on repercussions

Rupee declined 2.55% to Rs104.10 at close of the inter-bank exchange trade, coming down from the Rs102 a dollar where it was capped since early 2014.

“On one hand, it threatened us with money laundering charges for perceived manipulation in the open market and on the other end they are devaluing it. This policy is incomprehensible for me,” says Paracha.

The rupee was already getting hammered in the open market, but that was attributed to increased demand on account of pilgrims proceeding to Saudi Arabia.

So by keeping a tight leash on traders and by threatening them with money laundering charges, they have kept pkr stable.

[Gyan]

@Chandragupta. Pakis have perfected, North Korean model of showing only some highly decorative places as Pakistan. In fact, rest of that country is a "no go zone area."

While western outlets depict India (a free country, where they can roam freely at everyplace) as a poor.

I was talking to a very highly placed Pakistani (non-army) Govt servant who told me that there is Govt writ does not run in 80% of Pakistan

[K Mehta]

Meanwhile the liquidity injection continues
Govt raises Rs225bn from T-bills

The State Bank of Pakistan (SBP) on Wednesday sold Rs226 billion worth of treasury bills at an auction, much lower than the target of Rs300 billion fixed by the finance ministry for borrowing from the banks.

Two days before the T-bill auction, the State Bank of Pakistan injected a huge Rs1.141tr into the banking system through an open market operation. This followed an earlier injection of Rs1.091tr on August7.

[Prem]

Porkonomic-Mominomic Dukhionomical Saga
Pakistan's economy facing revenue generation crisis: report

( Paki lying again, real economy never crossed 200Billion Mark and approximately 180-190 Billion )

ISLAMABAD: Despite recent optimism surrounding Pakistan's economy, the country is facing an “existential crisis” stemming from its woeful tax collection rates and inability to finance itself, a report said Wednesday.Pakistan's economy grew at 4.24 per cent during the 2014-2015 fiscal year with per capita income rising a significant 9.25 per cent, markers that come as investor confidence in the long-underperfoming South Asian giant have also increased.But according to the report by non-profit organisation Raftar, funded by Britain's Department for International Development (DFID), Pakistan's economy continues to rely heavily on “commercial loans, concessionary donor loans and aid”.The country's tax-to-GDP ratio of 9.4 per cent is among the lowest in the world, leading to a public debt of 17 trillion rupees ($163 billion). This an almost three-fold increase since 2008 for the $232 ( exposing lie of 270Billion in 2012) billion economy, with 44 per cent of tax revenue going toward interest payments.
The report blamed the lack of a “tax culture” on non-revenue sources of funds the country has historically enjoyed in the form of foreign aid and loans. ( Fourfathers's Crime) It said 68 per cent of tax revenue was being generated through indirect taxes on fuel, food and electricity, which unfairly penalises the poor.The lack of revenue collection also negatively affects infrastructure development including power generation, with the country facing a massive shortfall of up to 4000MW in the summer that shaves about $15 billion off the country's GDP.Pakistan is currently in a $6.6 billion loan programme with the International Monetary Fund, which was granted on condition that Islamabad carried out extensive economic reforms, particularly in the energy and taxation sectors.

[Abhay_S]

Pakis trying to follow their new Masters Cheen and devalue their currency but Ego is coming in the way.

http://www.thenews.com.pk/Todays-News-9 ... nd-the-ego

[Falijee]

More people on airplanes right now than taxpayers in Pakistan

Only 0.3% of Pakistanis, or a mere 500,000 individuals, pay direct tax, according to a report by advocacy group Research and Advocacy for the Advancement of Allied Reforms (RAFTAAR).

In other words, there are more people on airplanes around the world at any given moment than there are Pakistanis who pay direct tax. (Direct taxes are taxes paid directly to a tax imposing authority, e.g. income tax.) In contrast, roughly 32 million, or 3%, Indians pay direct tax, even though they have a larger proportion of their population in poverty.

he report found that while overall state expenditure has steadily risen, Pakistan’s tax revenue collection has remained flat for most of last decade. With a tax-to-GDP ratio of 9.4%, Pakistan falls close to the bottom in the ranking of countries on the basis of revenue collection[*][/b].

[*] But then ' giving' Zakat is halal, and paying income tax is haram, so one cancels the other- conscious clear

Naturally, there is a budget deficit because we are not collecting enough taxes. This deficit is funded by expensive borrowing. Interestingly, only a third of our debt is now from foreign sources, i.e. two-thirds of national debt is money we owe to financiers within Pakistan. And they happen to be the expensive ones, with an average interest rate of 10.7%, compared to 1.9% for the overall foreign debt that we have. While foreign debt is cheaper, access to it is limited.

Naturally, there is a budget deficit because we are not collecting enough taxes. This deficit is funded by expensive borrowing. Interestingly, only a third of our debt is now from foreign sources, i.e. two-thirds of national debt is money we owe to financiers within Pakistan. And they happen to be the expensive ones, with an average interest rate of 10.7%, compared to 1.9% for the overall foreign debt that we have. While foreign debt is cheaper, access to it is limited.[*]
.[*] Abuse of the 'Banking Loan' system is rampart in Pakiland ; there have been earlier reports that PM Ganja has been one of the largest defaulter of bank loans

Despite an appallingly low number of tax filers, people feel they are taxed a lot, the survey finds. This is partly because the government is unable to collect direct taxes and resorts to indirect taxation, which is 68% of total tax revenue.

[K Mehta]

Quotes from the link abhay_s has posted
link

There is a sense amongst many prominent policymakers in Pakistan, particularly the finance minister, that Pakistan’s currency, in particular its exchange rate, is a sign of one’s ego. Official statements such as: ‘we will never let Pakistan’s rupee depreciate or devalue’, or that ‘we will protect the rupee at every cost’ show that Pakistan’s senior most policymakers are concerned more with some old-fashioned notion of image or ana (ego), and that too, a false one, rather than the fundamentals of economics.

After taking over as finance minister, Ishaq Dar ‘successfully’, if that is the right term here, showed how he could improve Pakistan’s rupee/dollar rate from around Rs104 to Rs98. Economic fundamentals be damned, and Maula Jatt’s danda reigned supreme.

When the finance minister insists that the rupee has to be brought down to Rs98 a US dollar and puts his reputation at stake, who needs a PhD in Economics.

Pakistan’s preeminent economist, Hafiz A Pasha, who examines economic issues rather than wishes and desires. Hafiz A Pasha quotes evidence from the State Bank of Pakistan showing that ‘the rupee is now overvalued to the extent of 18 percent’. This means that rather than Rs98 or even Rs104 which it is today, the dollar should be at around Rs122, if one looked at real economic factors.

At 122/$ pkr would be around 1.95/INR. The rest is all sialkot statistics.

[K Mehta]

Jhujarji
The inflated GDP and hidden population of bakistan is a gimmick to make bakistan a "middle income" country (high GDP /low population = higher per capita income) to avail IBRD loans and to have higher deficit by reducing deficit to GDP ratio. If you can find time please look into it.

[K Mehta]

IMF probing the musharraf of paki government as the source of deficit numbers.

ISLAMABAD: In a move carrying far-reaching implications for a $6.2 billion bailout package, the International Monetary Fund is investigating Pakistan’s claim of restricting the federal budget deficit to 5.3% of the total size of the national economy or Rs1.45 trillion in fiscal year 2015.

The IMF’s resident mission decided to reopen the books after several independent experts publicly questioned the authenticity of the figure, claiming the deficit was Rs1.8 trillion when including the circular debt.

In an op-ed piece appearing in a local daily, former State Bank governor Shahid Kardar stated that despite Pakistan’s failure to meet two key performance benchmarks of the programme, the IMF took a lenient view and granted waivers. He said that in less than two years, the IMF gave 12 waivers to Islamabad, the largest number of waivers under any IMF programme.

He argued that the government was practicing an “unashamed manipulation of data” to show a lower budget deficit, an act in which the IMF was complicit.

former finance minister Hafiz Pasha expressed similar views, saying, “In our close to 70 years’ history, we’ve never had a government that fudged statistics to the extent of this one.” He said the actual 2015 budget deficit including circular debt was closer to 8.5% of GDP, not the 5.3% the government claimed.

during the IMF’s earlier analysis, it had treated the $1 billion raised through the secondary market offering of the government’s shares in Habib Bank as revenue, even though the 2000 Privatisation Ordinance requires such proceeds to be treated as financing, not revenue. In addition, the IMF excluded the $1 billion Islamic Eurobond issued by the government from its external financing.

A meeting of the Executive Board of the IMF is tentatively scheduled for early next month to allow the disbursement of next loan tranche of $500 million. If 5.3% figure turns out to be incorrect, the country may face problems in getting further loans from the IMF, the World Bank and the Asian Development Bank.

[Abhay_S]

Quotes from the link abhay_s has posted
link

There is a sense amongst many prominent policymakers in Pakistan, particularly the finance minister, that Pakistan’s currency, in particular its exchange rate, is a sign of one’s ego. Official statements such as: ‘we will never let Pakistan’s rupee depreciate or devalue’, or that ‘we will protect the rupee at every cost’ show that Pakistan’s senior most policymakers are concerned more with some old-fashioned notion of image or ana (ego), and that too, a false one, rather than the fundamentals of economics.

After taking over as finance minister, Ishaq Dar ‘successfully’, if that is the right term here, showed how he could improve Pakistan’s rupee/dollar rate from around Rs104 to Rs98. Economic fundamentals be damned, and Maula Jatt’s danda reigned supreme.

When the finance minister insists that the rupee has to be brought down to Rs98 a US dollar and puts his reputation at stake, who needs a PhD in Economics.

Pakistan’s preeminent economist, Hafiz A Pasha, who examines economic issues rather than wishes and desires. Hafiz A Pasha quotes evidence from the State Bank of Pakistan showing that ‘the rupee is now overvalued to the extent of 18 percent’. This means that rather than Rs98 or even Rs104 which it is today, the dollar should be at around Rs122, if one looked at real economic factors.

At 122/$ pkr would be around 1.95/INR. The rest is all sialkot statistics.

Mehta Ji,

did not get the Sialkot reference is it the fudging they did during the 90s ?

[Abhay_S]

http://www.aaj.tv/2015/08/pakistans-eco ... -report-2/

ISLAMABAD: Despite recent optimism surrounding Pakistan’s economy, the country is facing an “existential crisis” stemming from its woeful tax collection rates and inability to finance itself, a report said Wednesday.

Pakistan’s economy grew at 4.24 percent during the 2014-2015 fiscal year with per capita income rising a significant 9.25 percent, markers that come as investor confidence in the long-underperfoming South Asian giant have also increased.

But according to the report by non-profit organisation Raftar, funded by Britain’s Department for International Development (DFID), Pakistan’s economy continues to rely heavily on “commercial loans, concessionary donor loans and aid”.

The country’s tax-to-GDP ratio of 9.4 percent is among the lowest in the world, leading to a public debt of 17 trillion rupees ($163 billion). This an almost three-fold increase since 2008 for the $232 billion economy, with 44 percent of tax revenue going toward interest payments.

The report blamed the lack of a “tax culture” on non-revenue sources of funds the country has historically enjoyed in the form of foreign aid and loans.

It said 68 percent of tax revenue was being generated through indirect taxes on fuel, food and electricity, which unfairly penalises the poor.

The lack of revenue collection also negatively affects infrastructure development including power generation, with the country facing a massive shortfall of up to 4000 MW in the summer that shaves about $15 billion off the country’s GDP.

Pakistan is currently in a $6.6 billion loan programme with the International Monetary Fund, which was granted on condition that Islamabad carried out extensive economic reforms, particularly in the energy and taxation sectors.

[shaun]

^^^^
Why do people don't even bother to read the posts in the thread. The above article was posted before in this page . If it had been a very old post and need reference , that had been a different story.Is it just to increase the post count . In numerous occasions we are reading the same post again and again which are not even 24 hrs old .

[Arjun]

The Chinese always had the highest propensity for gambling among all races, the CPEC project is surely a confirmation...

Gotta have balls of steel to invest $46 Billion in a shithole like Pakistan (esp when the latter is intent on provoking India with terror and cease-fire violations):

From China to Pakistan: A well-thought-out 3,000km lifeline

[Falijee]

The Chinese always had the highest propensity for gambling among all races, the CPEC project is surely a confirmation...

Gotta have balls of steel to invest $46 Billion in a shithole like Pakistan (esp when the latter is intent on provoking India with terror and cease-fire violations):

From China to Pakistan: A well-thought-out 3,000km lifeline

Arjunji : Leave aside the 'Chini penchant' for 'Economic High Risk ' behaviour .
All this CPEC hoopla was before the recent 'bad news' ( or economic warfare by the US ); take your pick of whichever version you want to believe - as the CPEC programme, appears a very-very long -term project indeed, based on so many assumptions .....

[kit]

Investments like those are made despite knowing those will not be repaid .. eventually the investor would "own" the other one .. but the paki logic is that this would entail a stake in its survival by the investor ..read China

[Chandragupta]

Pakistan would soon become Chinese territory for all practical purposes.

[Aditya_V]

Pakistan would soon become Chinese territory for all practical purposes.

Wrong Pakis have fooled every creditor. Arabs, Europeans and Americans have been fooled.

[Chandragupta]

Pakistan would soon become Chinese territory for all practical purposes.

Wrong Pakis have fooled every creditor. Arabs, Europeans and Americans have been fooled.

They won't get away this time with the Chinese. China already has troops in PoK, it will bring more troops to secure its construction crews in the so called CPEC. Will they go away? No. After that they constructed, IF they are ever constructed, the Chinese troops will stay put to keep them intact. The Pakis will consider Chinese armed presence as a deterrent for any Indian offensive action.

[Kashi]

They won't get away this time with the Chinese. China already has troops in PoK, it will bring more troops to secure its construction crews in the so called CPEC. Will they go away? No. After that they constructed, IF they are ever constructed, the Chinese troops will stay put to keep them intact. The Pakis will consider Chinese armed presence as a deterrent for any Indian offensive action.

How many troops can the Chinese bring in? Surely not enough to guard the entire stretch from Gwadar to Karakoram. Even they do, their logistics will be stretched thin and will also offer a juicy target for the "non-state actors". Pakis will by the force of habbit will ask for more Baksheesh to "check" these elements, while encouraging them to keep probing the Chinese forces.

The Chinese forces if they do come in, will barely venture beyond Skardu or at the most till Neelum valley, since that will the limit of their comfort zone. They reckon that this will also keep us at bay and we'll refrain from any adventures into PoK, while they are there.

They will however, lean upon the Pakis to secure 90% of CPEC and unlike Americans will play hardball if "trade and transit" suffers any delays or losses, since they are hardly dependent on this route for their critical needs.

Pakis being pakis, will display their Pakiness sooner rather than later- chor chori se jaaye par seenajori se na jaaye.

Then why all this hoopla about CPEC? Because it's never gonna get built.

[Falijee]

UAE halts sales of Naphtha from Pakistan after getting cosy with India [*][/url]

[*] Have yet to see this 'important' news in mainstream Paki English Press ; maybe considering the 'right' spin to give this

ISLAMABAD (Staff Report) – The United Arab Emirates (UAE) has stopped purchasing Petroleum Naphtha from Pakistan after a $80 billion deal with India, Trade Minister Khurram Dastagir has confirmed.

Last year, Pakistan exported 3490 metric ton petroleum crude worth 320 million while 9425 MT Excel Top Naphtha was exported for Rs920m and 9900 MT Petroleum Top Naphtha for Rs970m.

[*] Pakis import crude oil and then re-export one of the by-product of this processing ( NAPTHA); it will be some-time, before the effects are felt on the Paki economy (loss of jobs, loss of foreign exchange, unused excess capacity, spin off effects etc)

The export of Top Naphtha has reduced to absolutely zero.[*]

[*] The UAE Minister's recent outburst ( '' Pakistan will pay a heavy price ......), it appears, was no empty threat, if this is to be believed . And Modiji's 'aggressive' diplomacy on his recent visit was a disaster for the Pakis . Pakis should be ready for more such shocks

[Falijee]

US, Afghanistan Still Doubt Pakistan's Commitment in Fight Against Militants

The U.S. State Department has recently designated Abdul Aziz Haqqani as a specially designated global terrorist under Executive Order 13224, which targets terrorists and those providing support to acts of terrorism. Aziz Haqqani is a senior member of the Haqqani network and brother of the network’s leader Sirajuddin Haqqani.

Even though much of the payment for 2015 has been processed, the last payment of about $300 million may be withheld on the basis of Pakistan not doing enough against the Haqqani network, which allegedly has found safe haven inside Pakistan.[*]

[*] This is all public posturing for the benefit of the US Tax payer ; ultimately, as in other past cases, the Pakis will get their 'rent money'

The issue of the Haqqani network was at the top of the agenda [*]of U.S. National Security Advisor Susan Rice when she met with Pakistan’s civilian and military leadership in Islamabad during her visit this week.

[*] According to the Paki Press, the NSA Advisor was there to deliver a 'personal invitation' to NS from BO

Hussain Haqqani, Pakistan’s former ambassador to the United States, agrees with Cordesman's assessment about Pakistan’s motives for using non-state actors for its interests in the region.

“Pakistan has not done enough in fighting terrorists, especially those that attack inside Afghanistan and those that attack inside India,” Haqqani said.

It’s not yet known when and where the second round of peace talks will take place. But on Monday, Afghan Chief Executive Officer Abdullah Abdullah’s spokesman Javed Faisal told VOA that Pakistan will not be part of the peace process should it restart.
[*]
“We do not expect anything from Pakistan, nor do we want Pakistan to mediate between the Afghan government and the Taliban,” Faisal said.

[*] Pressure from 'uncle' will likely change his decision

[schinnas]

UAE halts sales of Naphtha from Pakistan after getting cosy with India [*][/url]

[*] Have yet to see this 'important' news in mainstream Paki English Press ; maybe considering the 'right' spin to give this

ISLAMABAD (Staff Report) – The United Arab Emirates (UAE) has stopped purchasing Petroleum Naphtha from Pakistan after a $80 billion deal with India, Trade Minister Khurram Dastagir has confirmed.

Last year, Pakistan exported 3490 metric ton petroleum crude worth 320 million while 9425 MT Excel Top Naphtha was exported for Rs920m and 9900 MT Petroleum Top Naphtha for Rs970m.

[*] Pakis import crude oil and then re-export one of the by-product of this processing ( NAPTHA); it will be some-time, before the effects are felt on the Paki economy (loss of jobs, loss of foreign exchange, unused excess capacity, spin off effects etc)

The export of Top Naphtha has reduced to absolutely zero.[*]

[*] The UAE Minister's recent outburst ( '' Pakistan will pay a heavy price ......), it appears, was no empty threat, if this is to be believed . And Modiji's 'aggressive' diplomacy on his recent visit was a disaster for the Pakis . Pakis should be ready for more such shocks

Given the sorry state of its exports, Pukistani economy and balance of payments capability is very much dependent upon IMF loans and expatriation of money by NRPs (Non Resident Pakistanis). UAE has over 1.5 Million Pakis who send back money to Pakistan. All UAE has to do is send them back and replace them with workforce from India, Philippines, Bangladesh, etc.

[Falijee]

Sorry, posted 'Afghanistan' story in the wrong thread