Pakistani Economic Stress Watch

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RamaT
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Re: Pakistani Economic Stress Watch

Postby RamaT » 18 Nov 2010 15:39

amit wrote:So you really think China is a benign power do you? It will actually share mineral resource in Afghanistan and CAR with India and give up its interference in J & K and all after we give the "Chinese what they want"? Wow, man a leap of faith I must say.

In the 21 st century the biggest clash between India and China will occur in their race to corner resources. It's already starting to happen and it will get uglier as we progress. Just look at the latest Chinese admission about the Dam on the Bhramaputra.

And you want us to believe that if we are very nice to the Chinese and allow them free pass in Afghanistan and CAR, they would turn very nice and share resource from the two regions with us? Really this is hilarious, you actually believe the Chinese will give us access to CAR via its territory!

:rotfl:


I'm not blinded by the fact that they are being aggressive.. we can be aggressive in our response and end up at a conflict or use their momentum to end up at a manageable solution. They have goals to achieve, if we stand in the way then we end up in a fistfight. Always better to look for a win-win, India needs the next 15 - 20 years for 10% compound effect.

That growth should not come at the sacrifice of strategic goals. Just trying to expand the possibilities so it's not all a zero sum game.

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Re: Pakistani Economic Stress Watch

Postby RamaT » 18 Nov 2010 15:43

shiv wrote:
RamaT wrote:Re-thinking the whole situation WRT Gwadar and Chinese railway, there is another way. One which is more constructive between India and China and turns Pakistan into an area where China loses significant interest quite quickly.
..
Other than geography(manageable) and an agreement between China/India(impossible?) what would hold this back?



Wrong thread. A land route via India (Karakoram pass) and via the North East to Kolkata/Chittagong would be sensible. But the Chinese have to be sensible.


Wen was making sensible sounding noises.. but that's probably just because he wants things smooth ahead of his visit. Like it or not we are the Junior partner here due to our slower economic growth over the last 20 years. We need to present creative solutions.

Message understood about wrong thread.. will not respond further about Chinese here, the idea just came as I was thinking of how to starve the Paki economy by denying them next client/master.

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Re: Pakistani Economic Stress Watch

Postby amit » 18 Nov 2010 15:59

RamaT wrote:That growth should not come at the sacrifice of strategic goals. Just trying to expand the possibilities so it's not all a zero sum game.



I'm sorry but it's already a zero sum game.

And that is because resources are not infinite and when you have two billion plus populations trying to grab what little is left after the looting done by the West during the 20th century, then you have a situation when one's gain is the other's loss.

That's been happening all across the world and usually, till now the loser has been India. (Just look at the oil exploration fields).

Now if China was indeed a reasonable nation we could perhaps have sat down with it and do a give and take. There is no evidence to think that China, under its present leadership, is interested in give and take. It will grab anything it can without scruples. One reason they support some of the world's worst despots in Africa and elsewhere. It respects strength and sneers on weakness (another name for reasonableness in the CPC lexicon).

In this context to think that they would suddenly become reasonable and accommodate India if we allow them space in J&K and Afghanistan - and this is not even taking into consideration what their All Weather Friend would do - then it's either foolishness of the highest order, or is an agenda driven proposition.

I don't know which one it is as far as you are concerned. However, my experience is that sooner or later it always comes out from the posts.

Admins sorry for the OT post. But since this point was raised here for continuity IMO this should remain here.

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Re: Pakistani Economic Stress Watch

Postby Brad Goodman » 18 Nov 2010 21:47

Pakistan's biggest city on edge of gang-led civil war

KARACHI, Pakistan -- At Karachi's giant Shershah automobile parts market, customers are scarce nowadays, fearing more violence of the sort that left 13 dead last month. The gunmen arrived by motorbike and rampaged through the narrow alleys of the bazaar, executing shopkeepers


"It would only take one small thing for outright civil war to erupt in Karachi," said a Western diplomat, who spoke on condition of anonymity because of the sensitivity of the issue. "The question is whether there is going to be a tipping point."


By some estimates, Karachi accounts for 25 percent to 30 percent of the entire economy of key U.S. anti-terror ally Pakistan, making it a highly lucrative target for money-hungry gangs from poor neighborhoods. Karachi matters greatly to the United States, as 40 percent of all supplies to U.S. troops in neighboring Afghanistan funnels through the port.


At its heart: money, including profits from extorting protection money from shops, factories and offices, a property grabbing operation - occupying land or buildings - and the drug trade. The competition is over who collects. Crossing a single street can take you into the territory of another gang. Only the upscale areas of Defence and Clifton, where the city's elite lives, are spared


At Shershah market, there is now, belatedly, a visible police presence, but the shop owners still don't feel safe. One trader quietly told how on Oct. 19, gunmen pulled up the steel shutters of his store and shot his two sons and brother inside. His sons, age 24 and 26, died, while his brother was critically injured and is now partly paralyzed.

The shop owner said that he, along with every other outlet in the market, was dutifully paying extortion money to Baloch gangs.

"They shot them as if they were infidels," said the shop owner, who didn't want his name used out of fear for his safety. "We are not linked to any political party. We were just doing our business. What was our fault?"

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Re: Pakistani Economic Stress Watch

Postby Prem » 19 Nov 2010 02:18

http://www.businessrecorder.com/news/to ... rcent.html
Foreign investment down by 36 percent
RECORDER REPORT
KARACHI (November 17, 2010) : Net foreign investment posted a decrease of 36 percent during first four months (July-October) of the current fiscal year, mainly due to instability on political and economic fronts. The State Bank on Tuesday said that net foreign investment, comprising foreign direct investment (FDI) and portfolio investment, had registered a decline of $316 million during the July-October of fiscal year 2010-11.
With the current decline, net foreign investment decreased to $569 million as compared to $884.9 million in same period of last fiscal year 2009, depicting a decline of 35.7 percent. Although both heads of investments showed declining trend, major decline was in portfolio investment, while decline in FDI was less than portfolio investment.
Portfolio investment posted a decline of 64.9 percent during the first four months. Portfolio investment, mainly done in stock market, stood at $101.3 million during July-October of fiscal year 2010-11 as against $288.5 million in corresponding period of last fiscal year, depicting a decrease of $187.2 million.
FDI posted a decline of 21.6 percent, or $128.7 million, to $467.7 million in first four months of current fiscal year as compared to $596.4 million in same period of last fiscal year. There was 9.5 percent decline in FDI during the first quarter. However, currently the decline surged to 21.6 percent, which is a matter of concern, economists said. They said that uncertainty on political front, poor infrastructure and worse law and order situation had been major hurdles in foreign investment.

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Re: Pakistani Economic Stress Watch

Postby Rishirishi » 19 Nov 2010 02:28

It is a miracle that TSP gets any fi at all :rotfl:

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Re: Pakistani Economic Stress Watch

Postby Prem » 19 Nov 2010 10:06

http://www.dawn.com/2010/11/17/imf-proj ... rowth.html
WASHINGTON: The International Monetary Fund has projected that during 2010-11 Pakistan will have an average inflation rate of 14 per cent and a real GDP growth of 2.75 per cent. “The balance of payments is expected to weaken in 2010-11, due in part to the impact of the floods,” said an IMF statement issued in Washington on Tuesday.“Imports will rise as food and other basic goods will need to be sourced from abroad and imports of capital equipment for reconstruction will increase,” the statement said.
The IMF noted although the major export plants had escaped physical damage, cotton and textiles exports might be lower.The IMF, however, expects that the higher trade deficit will be compensated in part by rising remittances from Pakistanis abroad. Even so, the current account deficit will likely widen by 0.8 per cent of GDP to 2.8 per cent.

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Re: Pakistani Economic Stress Watch

Postby Prem » 19 Nov 2010 10:10

Weekly inflation rises by 2.54pc :?:

ISLAMABAD (APP) - The Sensitive Price Indicator (SPI), for the week ended on November 11, for the lowest income group up to Rs.3,000, has registered increase of 2.54 percent over the previous week.
The SPI for the week under review in the above mentioned group was recorded at 304.54 points as against 297.01 points registered in the previous week, according provisional figures of Federal Bureau of Statistics (FBS).The weekly SPI has been computed with base 2000-2001=100 covering 17 urban centers and 53 essential items for all income groups and combined.SPI for the combined group registered also increased by 1.78 per cent as it went up from 282.29 points in the previous week to 287.32 points in the week under review.As compared to the corresponding week of last year, the SPI for the combined group in the week under review witnessed increase of 23.96 percent.As compared to the last week, the SPI for the income groups ranging from Rs.3001-5000, Rs.5001-12000 and above Rs.12000 increased by 2.30 percent, 2.01 percent and 1.40 percent respectively.
During the week under review average prices of 7 items registered decrease, while that of 26 items increase with the remaining 20 items’ prices unchanged

http://www.nation.com.pk/pakistan-news- ... s-by-254pc

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Re: Pakistani Economic Stress Watch

Postby neeraj » 19 Nov 2010 10:11

International textile manufacturers slam India
KARACHI - Head of International Textile Manufacturers Federation Bashir Ali Mohammed has slammed Indian exporters for reneging on their commitments on cotton orders and expressed grave concern over India Government decision to ban cotton export.
The intervention by the Government of India was undermining the sanctity of the contract as a result distorting the international cotton and textile markets that in turn is negatively affecting large parts of the global textile and cotton sector. At the same time the restrictions are also shedding unfavorable light on the Indian cotton industry as well as on the international cotton industry as a whole and damaging the good image of cotton. :rotfl:

We should make it a policy never to export cotton to Pakistan.

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Re: Pakistani Economic Stress Watch

Postby amit » 19 Nov 2010 10:57

neeraj wrote:International textile manufacturers slam India
KARACHI - Head of International Textile Manufacturers Federation Bashir Ali Mohammed has slammed Indian exporters for reneging on their commitments on cotton orders and expressed grave concern over India Government decision to ban cotton export.
The intervention by the Government of India was undermining the sanctity of the contract as a result distorting the international cotton and textile markets that in turn is negatively affecting large parts of the global textile and cotton sector. At the same time the restrictions are also shedding unfavorable light on the Indian cotton industry as well as on the international cotton industry as a whole and damaging the good image of cotton. :rotfl:

We should make it a policy never to export cotton to Pakistan.


Someone should tell Bashir Mian that the image of Cotton will always remain Lily White because that's the color it's born with. :-)

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Re: Pakistani Economic Stress Watch

Postby Lalmohan » 19 Nov 2010 16:09

is foreign investment really NRP investment by another name?

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Re: Pakistani Economic Stress Watch

Postby vic » 19 Nov 2010 19:20

At Shershah market, there is now, belatedly, a visible police presence, but the shop owners still don't feel safe. One trader quietly told how on Oct. 19, gunmen pulled up the steel shutters of his store and shot his two sons and brother inside. His sons, age 24 and 26, died, while his brother was critically injured and is now partly paralyzed.

The shop owner said that he, along with every other outlet in the market, was dutifully paying extortion money to Baloch gangs.

"They shot them as if they were infidels," (I suppose it was ok, if they were shot or cut like goats or missiled by Dronacharya) :?: :mrgreen: said the shop owner, who didn't want his name used out of fear for his safety. "We are not linked to any political party. We were just doing our business. What was our fault?"
[/quote]

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Re: Pakistani Economic Stress Watch

Postby SSridhar » 20 Nov 2010 09:30

Najam Sethi in TFT, "Reform or Else"

Economic mismanagement has plumbed the depths. Tax collection is woefully inadequate, so bank borrowings and the fiscal deficit are way off. Inflation is unbridled but growth is abysmal. The circular debt that has crippled the energy sector is unrelenting but defense expenditures are soaring. Therefore the IMF is back in business and getting tough. The writing on the wall is clear: reform or else.

Pakistan’s tax to GDP ratio is 10 per cent. This ranks among the lowest in the world. On the expenditure side, however, debt servicing and defense gobble up over half our tax resources, compelling huge bank borrowings and running up inflationary fiscal deficits. This vicious cycle makes Pakistan increasingly dependent on foreign handouts by governments or financial institutions. Since this always comes with strings, it provokes a popular loss-of-sovereignty backlash. {Pakistan has been begging for all of its 63 years now. If the foreign handouts always came with strings, how come that after all these generous dole-outs by multiple partners and financial institutions for six decades, Pakistan is so poor and in need of so many reforms yet ? How come that nobody so far insisted as part of the 'string' that Pakistan should collect more tax, for example ? Was it not a very basic reform that should have been insisted right at the beginning before anything else ? Therefore, either these strings were not meant to make Pakistan reform or the Pakistanis successfully evaded these strings all these years.} Damned if you do and damned if you don’t.

But it doesn’t have to be this way. There is a well-trodden path of economic reform and discipline which, if implemented, would enable us to live respectably within our means. For starters, we must double our tax revenues, halve our unproductive expenditures and plug the holes in the system through which scarce resources are lost. In this way, we can control inflation, stabilize our currency, create a social net for the poor and spur economic growth.

We can double our tax resources by imposing a progressive income tax on agricultural incomes (that is related to land ownership) and a uniform value added tax on goods and services except on necessities like food, etc. These two simple measures will also plug the holes of corruption and tax evasion in the system by enforcing its documentation and regulation. But we don’t do this because our avaricious ruling elites sit in parliament and refuse to part with their ill-gotten wealth.

We can reduce government expenditures by focusing on the big items, especially on the defense budget. We don’t need so many F-16s and so many atomic bombs to counter India. There is no security threat from it. Pakistan has provoked all the wars with India since partition. Therefore the argument that "it is not India’s intentions but its military capacity which matters" is a recipe for a crippling arms race which is breaking our back. {The 'intentions' reason for continuing the same policy as before has been of recent origin. About a year old. This probably came about because political leaders like Zardari made such statements as India was not an enemy etc. Probably, the Americans also told the Army Generals that all wars so far with India were of Pakistan's own making. So, the Generals devised another argument} But we don’t do this because Military Inc. is threatened, especially the army’s political lordship over civilians. The latter can start at home by reducing federal ministries and ministers, abolishing the practice of political patronage and cutting down on foreign junkets and an army of hangers-on.

We can plug corruption and inefficiency by privatizing the big black holes in the public sector. When we do this, our priority should not be to scratch the backs of Arab Sheikhs as in the case of some major privatizations in the past but the big corporations of the West that bring expertise and international credit worthiness for Pakistan with them. We can start with the bleeding corporations and move on to the corrupt tax collection bureaucracy, at the ports of entry and then inside the bowels of the Federal Board of Revenue. If the native bureaucracy won’t deliver, then we need to privatize key positions to credible foreign entities to do the job, after ensuring there is no repetition of the SGS-Cotecna kickback cases that are hanging over the head of President Asif Zardari and the PPP.

Much more can be done if the will is there. Provincial governments can computerize the land revenue system so that big and small properties can be mortgaged swiftly for productive loans and the courts can be unclogged from premeditated property litigation that thwarts the ends of justice and the demands of the economy. In particular, the “patwari system” that underpins the corrupt and unaccountable power structure in the rural areas will have to be defanged. Valuable urban properties in unproductive or wasteful use of government functionaries and departments can be sold off to replenish the provincial coffers; town planning laws can be amended to allow high rise buildings to keep land prices stable and traffic problems minimal; and property sale and transfer taxes can be brought in line with world benchmarks.

By providing more resources for development, a suitable reform agenda will enable the provision of a social net for the poor and a more equitable distribution of wealth. This will stablise the political system and minimize outbreaks of disorder, anarchy or insurgency. The doctrine of internal security should eventually replace the fear of external insecurity. Politicians should learn to become public servants, dominating the discourse over civil-military relations.

This is do-able if the military understands that its long term interests are tied to a growing and free economy rather than a failing and dependent one, to a state that is at peace with itself and its neighbours rather than one which is racked internally and distrusted externally. It is do-able if the politicians realize that reform must begin at home before they can ask other institutions and social groups to make sacrifices. Will it happen? The record is depressing. But in view of the disparate, rising threats of the future, we have run out of options.

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Re: Pakistani Economic Stress Watch

Postby SSridhar » 20 Nov 2010 10:14

Another from TFT, "IMF & Pakistan: A Tortuous Relationship" by Safiya Aftab

As Pakistan continues to struggle through one of its worst economic crises, the IMF bogeyman has once again been unleashed from the magic lamp. The furor over the increase in petroleum prices had barely died down when another storm has begun to brew over the imposition of the reformed GST, and the proposed levy of a further 10 percent income tax. {not to mention 2% increase in electricity tariff every month for the next 8 months}The government insists that its hands are tied, that it has to fulfill IMF conditionalities, and possibly negotiate a new loan from the Fund if Pakistan’s economy is to be kept afloat. {That will be in addition to the 11Billion already sanctioned by the IMF ! Anyway, Pakistan has no intention of repaying the debts, has it ?}The opposition and the media are up in arms and demand that the additional taxation be rescinded immediately, not least because of its obviously inflationary impacts.

So where does Pakistan stand in relation to the IMF and what are its options?

As of October 31 2010, about $7 billion of the $11 billion loan negotiated with the IMF in November 2008 (augmented in August 2009) has been disbursed to Pakistan. The decision on the disbursement of the remaining $4 billion or so will be taken at the conclusion of the fifth review of the SBA, which is currently ongoing, and has been characterized by tortuous negotiations, numerous trips of Pakistani authorities and IMF officials back and forth between Washington, Dubai and Islamabad, and fevered speculation in the press.

Aside from a brief statement issued at the conclusion of the latest IMF mission on November 5, there is no official statement of what the Fund thinks of Pakistan’s performance under the SBA over the last two years. It is striking though, that in spite of the Pakistan government’s protestations on the painful steps it is forced to take by the IMF, it has actually (yet again) managed to skirt around some of the more difficult policy prescriptions. Tax collection was short of target, and defense expenditure was higher than expected (not surprising given the security challenges). Consequently the fiscal deficit closed at 6.3 percent of GDP in the last fiscal year, significantly higher than the IMF’s (revised) prescribed limit of 5.1 percent (in the original agreement they had plumped for 3.3 percent). Pakistan was supposed to desist from borrowing from the central bank under the terms of the SBA, but such borrowing became the prime means of bridging the budgetary gap in FY2010 – borrowing from the State Bank exceeded the target by Rs. 42 billion. {IMO, this is how 'strings' attached to the loans and aid are thwarted by Pakistan. They simply flout them without compunction and the lenders turn a blind eye. The excuse will always be that at least some reform has been implemented. The truth will be that after some time, even those reforms will fall by the way side}

The energy sector is another black hole. Electricity tariffs have risen 55 percent in the two years from June 2008 to June 2010, and fuel price adjustments in the tariff now come about automatically thanks to an amendment in the NEPRA Act. Energy subsidies are in the process of being phased out. But the structural issues have barely been touched. The SBA required the government to prepare a plan for elimination of the circular debt by end-March 2009, within the fiscal deficit target. After a slew of statements of intention in early 2010, there is little progress in resolving the energy sector debt chain. Similarly energy supply shortfalls continue. Essentially, consumers are now paying more for the same inefficient service.

The areas where the government does seem to have met SBA requirements is in the conduct of a tight monetary policy (although this has not had a significant impact on inflation), and in the ongoing reform of tax administration (reorganizing the Federal Board of Revenue to integrate sales tax and income tax collection systems). More recently, it has moved to reduce exemptions against the two taxes. The VAT idea has been shelved for now (the documentation required simply cannot be put in place in a short while), but a reformed GST is to be imposed from January, which will cover additional sectors, and is based on the principle of withdrawing existing exemptions.

It’s clear that the Fund is going to hold the government to its stated intention of reducing the deficit to 4 percent of GDP in the current fiscal year. This is not unexpected; the Fund has been accused by its critics of being fairly hidebound about its prescriptions, particularly the need to practice fiscal prudence. The IMF in turn is answerable to donors and cannot be seen to be supporting profligate governments. For the same reason, it will ask the government to plug holes in the energy sector debt crisis, which has arisen primarily because utilities are unable to control line losses.

Pakistan’s government has failed to meet fiscal targets again and again. One reason may be that it tends to concentrate on raising revenue, and is not successful in an environment where tax administration and governance is so weak that evasion is the norm rather than the exception. The government also tends to pander to vested interests and has practically given up on the idea of taxing agricultural income, real estate transactions or other capital gains to any significant degree. The only option than is to review expenditure and make some serious cuts, particularly in non-salary recurrent expenditure. It’s not clear why the government fails to even consider this seriously. Each new government never fails to announce an austerity drive including a reduction in the Cabinet, curtailment of official visits etc, but all the furor typically dies down in less than a week, and it’s back to business as usual.

We can curse the IMF, but it’s worth it to remember that the Fund is the lender of the last resort, and governments don’t approach it for funding till they exhaust other options. In other words, you are typically in a pretty bad shape by the time you ask for IMF bailouts. The IMF’s cookie cutter policy prescriptions can and should be criticized, but no government is obliged to go to the Fund to begin with, or having gone, accept the terms of the agreements hook, line and sinker. Policy makers can offer alternative plans to meet the same objectives. In Pakistan’s case, the policy seems to be that the agreement is signed as the Fund dictates, and then exemptions are negotiated, using the strategic importance of the country in the current geo-political scenario as a bargaining tool in the background. {Absolutely. And, the 3½ Friends promptly vote for that} Successive governments have refused to initiate or carry through structural economic reforms, depending instead on the notion that eventually donors will come through as they can’t let a nuclear state fail. This is basically a bully tactic and is pitiful. It’s a pity that this ruse has worked so far.{Fantastic. She hit the nail on the head. All these 'tough' IMF negotiations are a farce and wasteful expenditure of visits etc.}

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Re: Pakistani Economic Stress Watch

Postby neeraj » 21 Nov 2010 23:20

Ship-mounted power plant is country’s most expensive
LAHORE: The 230MW ship-mounted power plant, which will be pressed into service on Sunday (today), is by far the most expensive in the country, costing Rs15.66 per unit.

According to records of Pakistan Electric Power Company (Pepco), the Karkey Karadeniz Electrik Uretim of Turkey was allowed the high tariff of 5.98 cents per unit in May of 2009. If current furnace oil price (Rs60,000 per ton) is factored in, the price will rise to a whopping 18 cents per unit.

At the current rupee-dollar exchange rate this price comes to Rs15.66 per unit against current average price of Rs9.37 per unit.
According to Pepco calculations, the plant will single-handedly increase the overall tariff by a staggering four per cent if the cost is to be passed on to consumers.

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Re: Pakistani Economic Stress Watch

Postby neeraj » 21 Nov 2010 23:26

Govt sets new record of borrowing
KARACHI: The government has geared up its efforts to borrow from both the State Bank and scheduled banks accumulating the domestic debt to record new peaks as it added over Rs800 billion in a year.
It looks that the government is in a fix as higher borrowing from the State Bank attracts stern warning from the International Monetary Fund (IMF) while borrowing from schedule banks catches the attention of State Bank.
The IMF restricts government borrowing from the Central Bank as it is inflationary while borrowing from scheduled banks is criticised by the SBP which is issuing cautions that borrowing leaves little room for private sector credit growth.
The serious shortage of revenue compelled the government to borrow from the banking system which resulted in a new record last year. The situation during the first four months of the current fiscal year looks more compelling for the government to borrow from all possible resources.
The government made drastic cut in the allocated funds for development programmes during the last fiscal year while the officially available indictors show that the situation is grimmer this year.
The latest report shows that the government has so far borrowed about Rs200 billion from the State Bank while it has collected Rs71 billion from the scheduled banks.
If government continues to borrow at this pace, another Rs1 trillion would be added into the domestic debt.
Economists believe that the government could hardly generate Rs1.7 trillion as revenue during this fiscal year primarily due to expected poor economic growth.
The domestic debt rose to Rs4.863 trillion by August 2010 while it was Rs4.050 trillion in August 2009.

In 12 months, Rs813 billion were added to domestic debt.
While the government is busy to raise its revenue and imposed flood surcharge, the heavy borrowing seems to have already set new records.

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Re: Pakistani Economic Stress Watch

Postby neeraj » 21 Nov 2010 23:41

Pakistanis have mastered the art of begging
Pakistani must seek initial EU concessions: PDMEA
Pakistan Denim Manufacturers and Exporters Association (PDMEA) have urged the government to send a team to European Union (EU) for explaining the concerns of Pakistani exporters arising out of recent EU proposal on duty concession.
He said that Pakistan should insist that EU must stick to initial proposal of 75 items without any restriction and for 3 years and not accept anything less.

EU to support food security in Pakistan
“Pakistan is a great country, a great nation with a great potential and a large population but it is also a country affected by big problems, big calamities while the greatest calamity has been the recent floods. The ones who have suffered the highest in this country are those living in the rural areas amounting 60 to 70 per cent of the population and the people living in these rural areas contribute greatly to the economy,” he said while addressing a large gathering of small-scale farmers belonging to Farmer Interest Groups at Village Karsal in district Chakwal.

Haqqani encourages US investment for Thar coal reserves
“International financing is vital for coal extraction. I hope that US will also play its role financing this project,” the envoy said.

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Re: Pakistani Economic Stress Watch

Postby Prem » 25 Nov 2010 03:57

http://www.businessrecorder.com/news/to ... risis.html
( This is gonna be 5-6 Bill $ a year fee from 3.5 Enjoyerers of PoakBody)

Country heading fast towards worst gas crisis
ISLAMABAD (November 24, 2010) :
Pakistan is heading fast towards its worst gas crisis in a situation of widening of the gap in demand and supply as its 7 major reservoirs, currently contributing 65 percent of gas production, are going to completely dry up by 2014-15."Pakistan's gas crisis is going to get worse in the next 4 to 5 years as its major gas reservoirs are going to deplete, completely, by December 2015, and there is no visible sign of make-up of the gas reduction during this period", says a latest study conducted on Pakistan's hydro carbon potential.
Different studies have been conducted by the government and international agencies to have a clear picture of how much gas reservoirs Pakistan has and how much it needs to meet its rising demand in the next five to ten years. One of the studies conducted by a foreign consultant firm on the request of the government of Pakistan says that Pakistan's gas demand is set to increase by 4 to 5 percent whereas its production, already on the decline, is not going to match its demand.The study says that Pakistan's 7 major gas fields, including Sui gas field, Uch gas field and Qadirpur gas field, are depleting at alarmingly high pace and despite the government's best efforts there could not be any major discovery to make up reduction in growth in the last couple of years.
According to the study, Pakistan's gas demand is going to reach up to 5.6 billion cubic feet (BCF) by 2014-15, but production is set to go down substantially from the current level of below 4 BCF. The study adds that Pakistan's ineffective and flawed petroleum policies are contributing to its gas crisis. The government introduced at least three petroleum policies during the last one decade with the objective to attract investment and explore untapped areas for enhancing domestic oil and gas production, but none yielded the desired results, says the study. With the passage of time, Pakistan's exploration and production sector is becoming unattractive for investors, resulting in quick reduction in oil and gas production.Pakistan's gas production has gone down from 5 BCF in 2007 to 3.9 BCF in 2010

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Re: Pakistani Economic Stress Watch

Postby Brad Goodman » 25 Nov 2010 06:29

Pakistan International Airlines under Rs.1.1 trillion debt

PIA is under a debt of Rs1.11 trillion with a holding of Rs.16 billion only in the form of assets, the News International reported Tuesday.


Nothing different than the state of paki nation itself. The indicators are pretty much same


Regarding the revival plan, Haroon told the committee that the company plans to purchase 16 new planes.
:rotfl:

His swiss account will be fat pretty soon

I think in larger interest of global peace PIA should be allowed to go under. Less poakroaches will be able to get out of teh gutter to trouble the world.

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Re: Pakistani Economic Stress Watch

Postby Brad Goodman » 25 Nov 2010 06:34

Faisalabad textile exports register 50 percent decline

Textile export from Faisalabad Region has registered a decline of fifty percent due to severe gas and electricity load-shedding, hike in inputs cost and unfavourable conditions of doing business. General Manager, Faisalabad Dry Port revealed that last year 2009, the exports of textile goods were at 80 to 86 containers per day at Dry Port. Now only 40 to 42 containers of textile export goods are reaching per day

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Re: Pakistani Economic Stress Watch

Postby Brad Goodman » 25 Nov 2010 06:38

I remember few moons ago lots of BRFites expressed concern over EU trade concessions

EU Package of Trade Concessions for Pakistan “Watered Down”

Following internal negotiations, EU governments have approved a package of trade concessions set to boost Pakistani imports to the Union in the wake of the flood disaster in June this year.

However, the package originally proposed by the Commission on 7 October (see Bridges Weekly, 13 October 2010), has been modified in order to address the sensitivities and concerns of certain European states, prompting some on the receiving end to call it essentially useless.
:((

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Re: Pakistani Economic Stress Watch

Postby Brad Goodman » 25 Nov 2010 21:16

Forex reserves ease to $16.85 billion

Pakistan's foreign exchange reserves fell to $16.85 billion in the week ending Nov 19, down from $16.91 billion the previous week, the central bank said on Thursday.

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Re: Pakistani Economic Stress Watch

Postby neeraj » 25 Nov 2010 22:49

Pakistan slashes development to meet IMF targets
KARACHI: Pakistan is cutting its development spending by almost half, squeezed by worsening economic conditions and International Monetary Fund demands, government sources say, imperilling growth prospects.
The US ally :roll: will cut its Public Sector Development Programme (PSDP) budget by 46 per cent to 150 billion rupees ($1.75 billion) for fiscal year 2010/11, according to government sources who declined to be identified because they were not authorised to speak to the media....

....The floods are estimated to have caused $9.7 billion in damages including vital infrastructure. The new cuts will further impact investment in roads, bridges and dams, which Pakistan needs to grow its economy.
“By cutting PSDP, we are not creating any assets for future generations and will have problems going forward,” said Ashfaque Hasan Khan, Director General at NUST Business School in Islamabad.

LITTLE FAT TO CUT
But there’s very little fat for Pakistan to cut thanks to a past failure at reform. :mrgreen: Its debt servicing is $5.464 billion this year :(( , and seeking to cut the defence budget in a country still obsessed with India as a threat is a non-starter.
“Pakistan is really stuck between two difficult choices, but first and foremost, the cut in PSDP is because there is pressure to meet a certain fiscal deficit target,” said Khalid Iqbal Siddiqui, Director at Invest and Finance Securities Ltd....
....Pakistan is heavily dependent on foreign aid :(( and must show its commitment to fiscal reforms such as raising electricity tariffs, implementing a reformed general sales tax (RGST) and restructuring its energy sector if it wants more assistance.

Government spending on big ticket weapon systems like F-16s would have to end, it says, and the military would need to realise that an unstable economy is more of a threat than India. :twisted:
“Will it happen?” the editorial asks. “The record is depressing. But in view of the disparate, rising threats of the future, we have run out of options.” :(( – Reuters

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Re: Pakistani Economic Stress Watch

Postby Narad » 26 Nov 2010 00:14

^^^
Pakistan slashes development to meet IMF targets


In all probablities, this would trigger a vicious circle and we could see this negative/under development to further choke its economy and increase dependence on foreign loans and aids for its survival, adding further to the future fiscal defecit.

Out of everything, these pakcroaches could only come up with this strategy of balancing the deficit by hampering development?? More visible signs of a Zombie state in making.

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Re: Pakistani Economic Stress Watch

Postby Pratyush » 26 Nov 2010 11:19

What development? Human or Infrastructure. Where human is concerned they have outsourced it to the various arab charaties with predictable results.

When I comes to infrastructure. They can get loans from International lender to get the job done.

So what exactly are they cutting down on.

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Re: Pakistani Economic Stress Watch

Postby Brad Goodman » 27 Nov 2010 05:54

Pakistan's Cotton Exports May Plunge 25% After Crops Destroyed by Floods

Cotton exports from Pakistan, world’s fourth-biggest producer, may fall 25 percent this fiscal year because of flooding, according to the Karachi Cotton Brokers’ Association.

The country’s exports declined 22 percent in the first four months of the year that began July 1, compared with the same period a year earlier, as floods destroyed crops, the association said.

Pakistan’s deadliest floods this year ruined crops worth 281.6 billion rupees ($3.27 billion), destroying rice, cotton and sugar, Farm Minister Nazar Muhammad Gondal said Sept. 28. Floodwaters ripped out plants, damaged stockpiles and wrecked 4,000 kilometers (2,485 miles) of roads, boosting food prices and potentially accelerating annual inflation to 20 percent, according to government estimates.


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Re: Pakistani Economic Stress Watch

Postby SSridhar » 27 Nov 2010 07:36

Brad Goodman wrote:Pakistan's Cotton Exports May Plunge 25% After Crops Destroyed by Floods

Cotton exports from Pakistan, world’s fourth-biggest producer, may fall 25 percent this fiscal year because of flooding, according to the Karachi Cotton Brokers’ Association.

The country’s exports declined 22 percent in the first four months of the year that began July 1, compared with the same period a year earlier, as floods destroyed crops, the association said.



How can they be exporting when they are also importing cotton from India ? Aren't they complaining that Indian exporters are not keeping their promises and GoI must not ban export of cotton etc ?

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Re: Pakistani Economic Stress Watch

Postby shiv » 27 Nov 2010 07:41

Pakis will be whining and begging about the losses caused by floods for the next 10 years.
In the meantime I would like to remind all Packee lurkers of this recording - done shortly before the floods
http://www.youtube.com/watch?v=Ev_4ZI_hSg8

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Re: Pakistani Economic Stress Watch

Postby Brad Goodman » 27 Nov 2010 08:20

http://www.bloomberg.com/news/2010-11-25/pakistan-may-raise-rate-a-third-time-after-inflation-soared.html

Pakistan’s central bank may increase its benchmark interest rate for the third time in four months to stem inflation that exceeds 15 percent.
:shock:

How can abduls keep pace with commodities prices?

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Re: Pakistani Economic Stress Watch

Postby arun » 27 Nov 2010 10:45

So will the Islamic Republic of Pakistan compensate for this drop in exports of Textiles by increasing that other mainstay of exports, namely Terrorism ?:

Massive decline in textile exports

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Re: Pakistani Economic Stress Watch

Postby abhijitm » 27 Nov 2010 11:50

Pakistan slashes development to meet IMF targets

What nonsense kind of economics statement is this? In pakistani context IMF will always encourage raising taxes and thus raising investment. The report is misleading. It should read as 'pakistan slashes development to meet PA targets'. And if pakistan Finmin really interpreting IMF policy like this then not even allah can help them.

IMF Statement on the Occasion of the 2010 Pakistan Development Forum

The 2009/10 budget deficit target was missed by a significant margin and the end-June 2010 ceiling on government borrowing from the State Bank of Pakistan (SBP) was also exceeded. As a result, the fifth program review could not be completed on time

The authorities know that a swift and robust policy response is needed to manage the pressures existing before the floods, provide relief to flood victims, and contribute to reconstruction.

Structural reforms are needed to improve budgetary performance. Two areas stand out. One is the reformed general sales tax (RGST), including an effective input-crediting mechanism, reduced exemptions, and elimination of zero-rating and special rates

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Re: Pakistani Economic Stress Watch

Postby abhijitm » 27 Nov 2010 12:09

Foreigners resort to selling
The Karachi share market on Friday opened on a positive note and the KSE-100 index hit 11,195.63 points high level, up 60.29 points. However, selling by foreigners in late hours reduced the early gains and the index closed at 11,145.02 points with a marginal gain of 9.69 points, and foreign investors remained net sellers of shares worth $0.4 million :rotfl: .


did anyone notice this peculiar way of addressing FIIs? :lol:

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Re: Pakistani Economic Stress Watch

Postby amit » 27 Nov 2010 14:59

abhijitm wrote:Foreigners resort to selling
The Karachi share market on Friday opened on a positive note and the KSE-100 index hit 11,195.63 points high level, up 60.29 points. However, selling by foreigners in late hours reduced the early gains and the index closed at 11,145.02 points with a marginal gain of 9.69 points, and foreign investors remained net sellers of shares worth $0.4 million :rotfl: .


did anyone notice this peculiar way of addressing FIIs? :lol:


:)

More important is that fact that selling of shares worth a piddly $400,000 (I love the way they bring in million) can affect the index enough to bring down gains from 60.29 to 9.69. Gives a very good indication of how TAFTA the country's biggest stock exchange is.

:rotfl: :rotfl:

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Re: Pakistani Economic Stress Watch

Postby shiv » 27 Nov 2010 20:46

Is this a ripoff or am I missing something. A multimeter in India costs about Rs 750.
http://islamabad.olx.com.pk/fluke-multi ... d-67521675
Image

Fluke 77 IV Series Digital Multimeter

Versatile meters for field service or bench repair.
<snip>
It measures: Wide 1000 V measurement range

Average responding AC measurements

0.3% accuracy

10 Amps continuous (20A for 30 seconds)

Frequency and capacitance

Resistance and continuity

we sale fluke multimeter all modle and cheap rats now we have 77iv modle in stock

oreginale usa.

we sold it 15000 rupee only

conyact us 3005881683

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Re: Pakistani Economic Stress Watch

Postby vera_k » 27 Nov 2010 21:51

This seems to be an expensive model.

http://www.amazon.com/Fluke-77-4-Automo ... B000U8WQ4U

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Re: Pakistani Economic Stress Watch

Postby neeraj » 28 Nov 2010 10:30

Sunday bazaar fleecing the public
A sampling of typical prices of foodstuff at Sunday bazaars illustrates the dilemma the poor and the middle class are facing in Pakistan: sugar sells at Rs115 a kg INR 63.8, onions at Rs70 a kg INR 38.8, tomatoes at Rs60 a kg (INR 33.3), garlic Rs250 a kg INR 138.8, ginger at Rs220 a kg (INR 122.2), potatoes at Rs60 a kg (INR 33.3), etc.

Similarly fruits such as apples sell at Rs100 a kg (INR 55.5), pomegranate at Rs120 a kg (INR 66.6) and guava at Rs50 a kg (INR 27.7).

Other items such as eggs sell at Rs70 a dozen (INR 3.2 per egg), yogurt Rs80 a kg (INR 44.44), bananas Rs50 a dozen (INR 27.7), chicken Rs160 a kg INR 88.8, and broken rice at Rs70 a kg INR 38.8.

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Re: Pakistani Economic Stress Watch

Postby SSridhar » 29 Nov 2010 12:21

Unfulfilled Aid Hopes - DT Op-Ed
Western and Muslim aid donors and international financial institutions (IFIs) have left the Pakistani government’s high aid hopes largely unfulfilled at a time when it needed hard cash — and lots of it — the most urgently. This is the net outcome of the latest round of the Pakistan Development Forum (PDF), a group of 34 western and Muslim countries and international financial institutions that has just ended in Islamabad. It was previously know as the Aid-to-Pakistan Consortium.

Instead of offering a big package of fresh economic aid, the group sent a critical signal regarding the prevalent poor governance, corruption and lack of cohesive business policies. The PDF leaders asked Islamabad to “mobilise its own resources” and stressed that “the wealthy class needs to share the burden of reconstruction and rehabilitation of the flood victims” and “not to expect from foreign taxpayers to meet all the needs”.

Prime Minister Yousaf Raza Gilani, urging larger aid commitments, assured the donors to give Pakistan “more time to carry out structural reforms, including widening the tax base, as it struggles to recover from its worst floods this summer.” Finance Minister Abdul Hafeez Sheikh said, “Pakistan needs all the financial help it can get since the floods inflicted almost $ 10 billion in losses but donors’ mistrust over the transparent use of money has slowed donations.”

Still the good news is that some of the donors did commit fresh aid. Richard Holbrooke, the US Representative for Afghanistan and Pakistan, announced the diversion to recovery and rehabilitation of $ 500 million assistance from the already committed amount of $ 1.5 billion under the Kerry-Lugar Bill for this fiscal. Saudi Arabia committed $ 500 million in concessional loans to rebuild the flood-hit areas and $ 100 million to enhance the export of Pakistani products to Saudi Arabia. The Japanese Vice Minister for Foreign Affairs, M S Makiko Kikuta, announced $ 500 million assistance, including $ 233 million soft loans for the rehabilitation of roads and bridges in Khyber Pakhtunkhwa, and to import farm inputs like fertilisers and seed for distribution among the farmers of the flood-hit areas. It will also include $ 267 million assistance for flood-related works to be carried out by international organisations.

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Re: Pakistani Economic Stress Watch

Postby Prem » 30 Nov 2010 00:28

arun wrote:So will the Islamic Republic of Pakistan compensate for this drop in exports of Textiles by increasing that other mainstay of exports, namely Terrorism ?:

Massive decline in textile exports


This was expected and great news .Many clients they loose this year wont be coming back and Indians must exploit the oppertunity. Just 2 or 3 years of decline in textile export can push them into the economic abyss . By 2014-2015 they will need extra 5-6 Bill for energy import and if this coincide with minimum hard currency earning from textile export, NRP will be the first to jump ship.There wont be any coming back this time as another 911 will bring the bombing not $.

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Re: Pakistani Economic Stress Watch

Postby Brad Goodman » 30 Nov 2010 01:21

Pakistan's president seeks barter trade with Sri Lanka

Barter trade :shock: I mean are we in 7th century arabia? Perhaps this is shariah compliant way of trading. So what are we bartering now terrorists from pakis for coconuts from lanka?

COLOMBO — Pakistani President Asif Ali Zardari called for a barter agreement with Sri Lanka on Monday to boost trade between the two countries and sought expertise from the island in battling "terrorism".


Few moons ago the mujahids on deaf & dumb forums were claiming that it was paki army that was providing the expertise to lankans.

Zardari, on a visit to the island, told legislators that they should switch to exchanging their goods and services rather than depend on dollar-denominated import-export trade that drew on foreign reserves.


But it is halal to ask for AID in US Dollars. :D

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Re: Pakistani Economic Stress Watch

Postby A_Gupta » 30 Nov 2010 01:26

Zardari seeks barter trade with Sri Lanka, specifically mentions cement.
http://www.dawn.com/2010/11/29/pakistan ... lanka.html

State of Pakistan's cement industry:
http://www.brecorder.com/news/top-stori ... :news.html


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