Pakistani Economic Stress Watch

anupmisra · Post by **anupmisra** » 30 Nov 2010 02:06

Have no fear, pakis. There may be capital flight today but soon FDI will be pouring in by the shovelfuls. Paki abdul demands half a million bucks in investments.

Kareem Khan said on Monday that his client will file a lawsuit against the director of the CIA and the US defense secretary unless he receives $500 million in compensation.

A_Gupta · Post by **A_Gupta** » 30 Nov 2010 03:01

anupmisra wrote:
Kareem Khan said on Monday that his client will file a lawsuit against the director of the CIA and the US defense secretary unless he receives $500 million in compensation.

Must be retaliation for the lawsuit filed in Brooklyn court by relatives of the 26/11 Mumbai Chabad House victims.

r_subramanian · Post by **r_subramanian** » 30 Nov 2010 13:36

Further problems for Pakistan's Textile sector
Due to gas shortages during winter, Pakistan's industries will be hit with 2 to 3 days a week of 'gas loadshedding'. Analysts are of the view that the textile industry will not be able to meet export orders.
Gas closure for industrial sector

Lalmohan · Post by **Lalmohan** » 30 Nov 2010 13:39

i wonder what pakistan has to barter that the lankans would want...?

Pratyush · Post by **Pratyush** » 30 Nov 2010 13:46

Tarrel then ocean and deepal then mountain fliend. Is common between the two.

The relationship can be front for that.

ArmenT · Post by **ArmenT** » 01 Dec 2010 13:33

http://www.bbc.co.uk/news/world-south-asia-11875204

Pakistan floods push food prices higher

The UN's agriculture body, the Food and Agriculture Organization (FAO), says food prices in Pakistan have risen 10% since floods hit the country in August and wiped out much of its produce (I think real reason for 10% rise is Zardari taking his cut). Jill McGivering visited Sukkur in Sindh province, one of the areas worst affected by the floods, to see how rapidly rising prices are affecting local shopkeepers and customers.

...

The roads into Sukkur have been badly damaged by the floods. His fruit comes by lorry from other parts of Pakistan, including Punjab, Baluchistan and Rawalpindi.

But now, since the floods, those journeys take four or five days. Some of the fruit rots before it even reaches him.

The extra petrol also makes the extended journeys very expensive. They are additional costs which he has to pass on to the shopper.

He gave me some examples. Oranges which normally cost 40 rupees (46 cents; 30p) a kilo are now 50 rupees.

Pomegranates have more than doubled in price, from 60 or 70 rupees a kilo to 150 rupees ($1.75; £1.13). Basically most people can't afford to buy fruit any more, he told me - business has plummeted. There's a peach-filled truck across the river, but alas he cannot swim!

tejas · Post by **tejas** » 02 Dec 2010 03:56

I have a suggestion for the Poakistani gov't to help the average Allah fearing Abdul tide over this crisis: make more Chinese designed nukes!! Oh wait, they are already doing that. I'll have to put my thinking cap on and come up with a new idea. In the mean time will have to continue making multiple daily visits to this thread as nothing lifts my spirits more than seeing a long bearded Abdul in front of a pile of rotting fruit.

Cosmo_R · Post by **Cosmo_R** » 02 Dec 2010 04:01

^^^A_Gupta

"Must be retaliation for the lawsuit filed in Brooklyn court by relatives of the 26/11 Mumbai Chabad House victims."

Sorry I missed that. Can you provide a link?. That lawsuit would be very interesting indeed.

Airavat · Post by **Airavat** » 04 Dec 2010 08:00

reformed general sales tax (RGST) is likely to result in a record Rs1.2 trillion budget deficit

Conservative assessments show that the budget deficit will shoot above seven per cent of gross domestic product against a target of 4.7 per cent, they added. With a 4.7 per cent budget deficit the government will borrow over Rs500 billion from the domestic market. It has already obtained Rs200 billion from the central bank for budget financing. Meanwhile, revenue collection is already behind target by Rs76 billion in the first five months of the current fiscal year.

The International Monetary Fund’s (IMF) suspended bailout programme for the country still has two tranches worth $3.4 billion left. The US has already indicated that it will stop funding if Pakistan does not implement the RGST. The government has also estimated that it will receive $1.4 billion (Rs120 billion) from the Coalition Support Fund (Created after 9/11 to reimburse countries for providing assistance to the US in the global war on terror).

The government is also contemplating asking the IMF for a three-month extension in the bailout programme that is due to finish on December 31. “Pakistan will submit an extension request of three months to draw the last two tranches worth $3.4 billion from the International Monetary Fund at an appropriate time,” said Secretary for Finance Salman Siddique.

Brad Goodman · Post by **Brad Goodman** » 04 Dec 2010 22:11

Pakistan to seek extension in $11.3bn IMF loan

ISLAMABAD: Pakistan’s economic managers would request for an extension in the International Monetary Fund’s $11.3 billion stand-by programme for further three months before December 31. However, a formal approval from the political leadership would be sought before applying for the extension.

She said that reforms in the power sector were also underway and tariff adjustments had already started, adding that board of directors of power sector companies had already been dissolved for formation of new boards, adding that PEPCO had already been dissolved. The civil government expenditures had been estimated at Rs 165 billion annually, while there have been demands of cutting the size of the federal cabinet as the government’s power sector alone is causing losses worth Rs 356 billion.

Narad · Post by **Narad** » 06 Dec 2010 21:10

Loans by government affecting private sector development in Pakistan: Munter

US ambassador to Pakistan Cameron Munter has said loans secured by the government have affected development in private sector.

He went on to say that tax to GDP ratio in Pakistan was the lowest in the world. Subsidy being provided to the public sector enterprises is double in size than the Kerry Lugar Bill. Government is allowing subsidy to the tune of 20 billion dollars.

Prem · Post by **Prem** » 08 Dec 2010 03:20

Pakistan not off the hook in concession seeking: EU gives fresh assurance
ISLAMABAD (December 07, 2010) : Pakistan is not off the hook in concession-seeking efforts as European Union has formally conveyed to Islamabad that its case to get waiver for a concessional tariff regime from its member countries will again be presented to the World Trade Organisation (WTO) in March 2011.The officials in Islamabad seem little bit consoled and relieved after getting the new assurance from EU for keeping their hopes alive for getting some preferential treatment in the near future to help Pakistani exporters get more share and subsequently supplement the government's efforts to enhance export to that market.EU had presented Pakistan's case to WTO on November 29, for one-time waiver for concessional treatment for 75 key exportable items to the EU market on the ground that in post July 2010 flood the country deserves special concessions to steer its weakening economy out of current difficult phase, but it did not go through due to India's strong opposition. This development dashed Pakistan's hope to get special concessional for its some key sectors such as textile and value added which contribute to is exports to the EU. The officials here in Islamabad had calculated benefit in monetary terms to Pakistan of one-time waiver for concessional regime for 75 items roughly $900 million. This could also help Pakistan take its case for similar concessions from other key trade partners like Japan and USA.

http://www.businessrecorder.com/news/to ... rance.html

abhijitm · Post by **abhijitm** » 10 Dec 2010 23:07

There is nothing worthwhile to discuss about pakistani economy.

Massive power load-shedding from December 26

Massive power load shedding is to commence from December 26, 2010 across the country due to annual canals' closure and shortage of gas supply to the Independent Power Producers (IPPs) well-informed sources told Business Recorder.

meanwhile their business channel's website is blank and useless like their brain
Business Plus

Lalmohan · Post by **Lalmohan** » 10 Dec 2010 23:11

ofcourse, the rape have generators, and no one else needs bijli
and if they can't have bijli, the ISI can provide them for free (but only to genital area)

abhijitm · Post by **abhijitm** » 10 Dec 2010 23:15

Pakistan to import railway locomotives from US
what happened to taller than mountain engines??

ramana · Post by **ramana** » 10 Dec 2010 23:17

They need to recycle the aid money. Cant let them buy PRC stuff with US money.

Prem · Post by **Prem** » 11 Dec 2010 07:29

http://www.businessrecorder.com/news/co ... sions.html

LAHORE (December 10, 2010) : Chairman Pakistan Readymade Garments Manufacturers & Exporters Association (PRGMEA) Ejaz Khokhar has said possible delay in trade concessions from the EU till April 2011 may result in loss of about $2 billion during first quarter of the fiscal year.Talking to Business Recorder, Khokhar said the January shipments were almost ready with the exporters for the EU under the trade concessions, offered in context of economic loss due to recent floods. The European buyers had chalked out their business plans and shared with Pakistani exporters accordingly, he added.He slammed the Ministry of Commerce for slumbering over the issue, citing its incapacity to handle the issues as prime cause behind the possible delay. He also criticised the Ministry for not sharing information with stakeholders as having invested heavily once hopes were raised in the wake of Pak-EU official talks. Khokhar also criticised the EU for selecting a list of items on its own in the first place. The present reports about the delay in implementation of trade concessions were creating problems, he said adding Pakistan's total economy was badly hit due to floods.

SSridhar · Post by **SSridhar** » 11 Dec 2010 08:12

abhijitm wrote:Pakistan to import railway locomotives from US

From the above,

Only last month, the government had to cut its development budget by half to Rs140 billion because of severe economic limitations. Official figures suggested that government revenues are insufficient even to meet its current expenditure requirements and the national development budget is mainly financed by borrowings.

Pakistan’s total debt has already touched Rs10 trillion, forcing the government to pay more than Rs800 billion on debt servicing every year.{and development budget is a mere Rs. 140 Billion, one-sixth of annual debt servicing}

SSridhar · Post by **SSridhar** » 11 Dec 2010 13:42

Moody's reduces rating of 5 TSP banks

Moody's Investors Service has downgraded by one notch the global local-currency (GLC) deposit ratings and standalone bank financial strength ratings (BFSRs) of five Pakistani banks.

At the same time, the agency affirmed the foreign-currency deposit ratings assigned to these banks at B3/Not Prime (stable outlook). The foreign-currency deposit ratings remain constrained by Pakistan's B3 (stable outlook) country ceiling for foreign-currency deposits.

Moody's noted that the downgrades were primarily driven by the banks' growing exposure to (B3 rated) Pakistan government securities and government-related lending, as a consequence of limited private sector lending opportunities within the country's deteriorating macroeconomic conditions.

Moody's estimated that as of end-June 2010, the rated Pakistani banks' total exposure to sovereign-related risk assets had reached 38% of their total assets, from 24% in 2008, representing a material exposure concentration and raising the banking system's susceptibility to event risk at the B3 sovereign level.

While the financial fundamentals of Pakistani banks have shown relative resilience during adverse conditions in previous years, their inability to curb their rising overall exposure to the government sector highlights the limitations in depth and diversification of the country's banking system.

Although Moody's considers Pakistani rated banks' capitalisation levels as currently adequate, the high, and growing, exposure concentration to the B3-rated sovereign -- in conjunction with the prevailing weak macroeconomic conditions -- could challenge solvency levels. Driven by these considerations, Moody's has narrowed the gap between the Pakistani banks' ratings and the government rating (B3/stable) {And, Pakistanis would take that as a complement}.

As a result of the heavy flooding in Pakistan earlier this year, Moody's expects low economic growth and subdued loan demand from the private sector to prevail, leading to a further rise in banks' sovereign-related exposures, primarily in the form of T-Bills. At the same time, the sovereign structural subsidy-related debt arrears, mainly in the utility and commodity sectors, are unlikely to be settled in the near term, and such arrears will continue to exert further pressure on the corporate sector and, as a result, on the Pakistani banking system's asset quality.

Despite these growing challenges, Moody's believes that certain factors continue to support Pakistani banks' ratings being positioned at a higher level than the government rating. That said, the decision to maintain the negative outlook on the banks' standalone and long-term local-currency deposit ratings reflects the Pakistani banking sector's still growing exposure concentration to the sovereign and on-going vulnerability to macroeconomic deterioration, which could negatively impact both the sovereign and the country's banking system.

abhijitm · Post by **abhijitm** » 11 Dec 2010 23:58

India opposes EU trade concessions to Pakistan

EU efforts to stabilise regions of Pakistan ravaged by floods this year should be through direct aid payments not through tariff cuts to Pakistani exporters, Sharma said.

“We’re all for assistance to Pakistan, but let these two issues not be mixed,” he said in the interview conducted on Thursday. “These are separate issues.”

good, lets keep the pressure up. Even in the neutral sense giving free trade concession for such occasion must be avoided
The Encyclopedia of public choice

A free trade agreement avoids opportunist behavior in exchange of market access. By completely liberalizing all the way to free trade, the countries in the regional agreements are left with no scope for depreciating the value of the agreements by offering better terms of market access to other.

exactly India's point of view.

abhijitm · Post by **abhijitm** » 12 Dec 2010 00:21

I missed this news
WTO body rejects EU move to grant GSP to Pakistan

Bangladesh apparel exporters, who were very much worried over the EU move, have hailed the decision of the WTO.

"India, Peru and Venezuela opposed the move, while China and Brazil pleaded for further examination of the issue before providing Pakistan with the special trade privilege," he added.

Bangladesh enjoys the GSP facility in EU countries as similar facility is applicable to other least developed countries in the world.

"Pakistan cannot be eligible for GSP facility due to its status as developing country," Parvez told the FE.

so there is a pride for pakistan as they are a "developing country" !! Now only thing paki beggers have to do is to ask to dilute their status as "least developed country". How come its so difficult??
Apparently Standard and Poor rate Bangladesh better than Pakistan.

saip · Post by **saip** » 12 Dec 2010 02:21

abhijitm wrote:Pakistan to import railway locomotives from US
what happened to taller than mountain engines??

They must have gone into deeper than ocean hole

r_subramanian · Post by **r_subramanian** » 12 Dec 2010 06:58

When one door closes, another opens
The PPP government is having considerable difficulties in having the Reformed GST ( RGST ) taxation proposal implemented. Failure to implement RGST may result in Pakistan losing some funding from IMF. But fear not! The climate-change issue has given yet another opportunity for Pakistan to beg for money. It is the Green Climate Fund. It is claimed by 2020 under this funding a sum of US $100 billion a year will be available for helping poor nations.
How about, say U$ $5 billion a year, for the nuclear-armed Islamic Power to overcome the problems associated with the melting of Himalayan glaciers?

abhijitm · Post by **abhijitm** » 13 Dec 2010 22:53

pakistan do not have automobile industry and it never will
Import of used cars upto 5 years allowed

government imports cheap material to punish local business. Astonishing...

The government has raised the import `age limit` of used cars to five years from three years sending a strong message of displeasure to domestic car assemblers for their constant ignorance to Islamabad`s demand to lower car prices.

what an economy!

Prem · Post by **Prem** » 14 Dec 2010 09:49

http://www.businessrecorder.com/news/bu ... losed.html
Over 600 industrial units remain closed

FAISALABAD (December 12, 2010) : More than six hundred industrial units including 100,000 Powerlooms remained closed on third consecutive day, here on Saturday, while 380 CNG Station were remained closed on second day. Resultantly, 400,000 workforce most of them daily wagers becomes jobless and prevailing situation creating worst ever financial crisis for small-scale textile ancillaries.Local industrialists had tried to operate their factories by violating the Gas-shedding as a mark of protest, but local authorities of Sui Northern Gas Pipelines Limited (SNGPL) have decreased the gas pressure upto 70 percent, resultantly industrial units closed again for next 24 hours. SNGPL sources disclosed that it was considering that the all CNG stations of Punjab would be closed during winter seasons, because the short fall of Gas is continuously increasing.After an emergent meeting of Textile Associations, Muhammad Saeed Sheikh, Regional Chairman, All Pakistan Textile Processing Mills Association, Chaudhry Salamat Ali, Chairman, Pakistan Hosiery Manufacturers & Exporters Association (PHMA) North Zone and Mian Ajmal Farooq, Vice Chairman, Khurriawala Industrial Estate and other trade bodies leaders expressed grave concern over the three days long Gas-shedding for export oriented and labour intensive Value Added Textile Industry and stated that the prevailing situation is yielding negative impact over the national economy and forced them to windup their business.

( Destroy textile industry to destroy terrorism by Pak)

abhishek_sharma · Post by **abhishek_sharma** » 14 Dec 2010 16:46

BP Sells Pakistan Assets For $775 Million

http://www.nytimes.com/reuters/2010/12/ ... us-bp.html

Philip · Post by **Philip** » 14 Dec 2010 17:14

Good article on the arms race between India,Pak and China.The stress upon Pak would be a killer if not for the largesse with which its two chief sponsors,the Saudis and China provide it with,while "rich Uncle Sam",floods it with even more arms and moolah above and below the counter to tricks for him.

The writer is the Pakistan Scholar at the Woodrow Wilson Centre in Washington, DC.)

http://www.dawn.com/2010/12/12/the-scra ... -arms.html

The scramble for arms
Huma Yusuf
December 12, 2010 (2 days ago)

NOT content with shaming US diplomats, the Pakistani press this week, under the cover of the WikiLeaks scandal, dragged Indians into the mire too

In an effort to balance the Indian Army`s weapons procurement and growth, the Pakistan Army will seek to pursue and legitimise those foreign policies that yield the best real returns (read arms deals). The past week`s fake cables saga heralds what shape that legitimisation process might take.

And so it is that regional military developments will exacerbate Pakistan`s domestic political turmoil. As the Pakistan Army`s need to access to more weapons, technology, and training becomes urgent, the civil-military power struggle for control over politics, policymaking, and the public sphere`s perception of these matters will intensify. The army knows that its institutional development depends on its foreign policy credentials and its political capacity to emerge as a guarantor of regional diplomacy.

SSridhar · Post by **SSridhar** » 14 Dec 2010 17:28

Pakistan remained largely insulated from global financial crisis: State Bank of Pakistan
Since when have beggars affected the affluent ?

Lalmohan · Post by **Lalmohan** » 14 Dec 2010 19:45

^^^ donations continue to arrive despite severe economic downturns in donor countries
ergo the crazy soosai bummer trick is working

Prem · Post by **Prem** » 15 Dec 2010 03:41

SPI inflation surges by 21.68 percent
Official

Sensitive Price Indicator (SPI) figures released by the FBS showed an increase of Rs 13 per kg in price of tomato this week, followed by Rs 8 in the price of 2.5 liter cooking oil tin. Price of red chillies went up by Rs 4 per kg during the week.As a result, weekly inflation soared by 21.88 per cent in low income group with Rs 3000 monthly earning, followed by 21.75 per cent for the group having monthly income between Rs 3001 to Rs 5000. The dearness for consumers bracketed between Rs 5001 to Rs 12,000 was recorded as 21.77 per cent and 21.29 per cent for the group earning Rs 12,000 and above per month. The combined inflation during the week recorded 21.68 per cent increase compared to the corresponding week.The SPI computed of prices of 53 essential items collected from 17 urban centers showed an increase in the price of 17 items, decrease in 12 and price of 24 items remained unchanged during the week but relatively higher and of some commodities in double digits as compared to previous year.
Analysis of the data showed that during the week, price of tomatoes increased to Rs 53.45 per kg from Rs 40.19, LPG ( 11 kg cylinder) each to Rs 1356.21 from Rs 1263.47. The prices of vegetable ghee (tin) 2.5 kg increased to Rs 425 during the week from Rs 417, cooking oil (tin) 2.5 liter to Rs 425 from Rs 417, red chillies kg to Rs 236.90 from Rs 232.51, firewood 40 kg to Rs 343.97 from Rs 338.97, washing soap nylon cake to Rs 14.56 from Rs 14.38, vegetable ghee loose kg to Rs 150.97 from Rs 149.54, milk fresh liter to Rs 49.73 from Rs 49.26.Similarly, the price of moong pulse washed per kg increased to Rs 139.40 during the week from Rs 138.63, tea (prepared) cup to Rs 12.89 from Rs 12.83, mutton kg to Rs 411.93 from Rs 410.36, gram pulse washed kg to Rs 72.24 from Rs 72.0, wheat average quality per kg to Rs 26.72 from Rs 26.66, curd kg to Rs 57.70 from Rs 57.57, cooked beef plate each to Rs 52.79 from Rs 52.68, and wheat flour average quality per kg to Rs 30.73 from Rs 30.72.

http://www.businessrecorder.com/news/to ... rcent.html

r_subramanian · Post by **r_subramanian** » 20 Dec 2010 14:09

Rise in budget deficit
A lament about 'political expediency or the clout of vested interest groups' making it difficult to raise revenue and to cut expenditure.

Public finances of the country continue to be in a very poor shape. According to the latest data released by the Ministry of Finance, budget deficit during the first quarter of FY11 has climbed to Rs 276.2 billion or 1.6 percent of GDP ...

Even the agreements with the IMF now no longer carry the sanctity, they once did. Considering the ongoing trend, for instance, the budget deficit for the current year could reach 6.5 percent of the GDP { the agreed target is 4.7 percent of GDP } ...

It is thus more than obvious that immediate measures need to be vigorously pursued and implemented to bring down the budget deficit to a sustainable level by reducing expenditures and mobilising much higher level of resources. Sadly, however, while the realisation for such a shift in fiscal management is there, practical steps towards the desired direction are lacking due either to political expediency or the clout of vested interest groups to evade taxes and other levies...

Balancing the budget is undoubtedly of utmost importance if the country wants to avoid the risk of default...

link

SSridhar · Post by **SSridhar** » 22 Dec 2010 12:43

Pakistan seeks 9-month extension for the IMF loan programme

Finance Minister Abdul Hafeez Shaikh on Tuesday disclosed that Pakistan has sought a nine-month extension in the $11.3 billion stand-by arrangement (SBA) loan programme from the International Monetary Fund (IMF).

To a question after a ceremony at a local hotel, the minister said that the IMF Executive Board that was scheduled to meet today (Wednesday) in Washington might consider Pakistan’s request for an extension in the SBA programme.

It is worth mentioning here that the $11.3 billion IMF SBA loan programme is scheduled to end by December 31 and so far Pakistan has received $7.7 billion from the fund and disbursements of $3.6 billion have been held back due to the non-observance of performance benchmarks from the last nine months. An inbuilt provision for extension is available in the SBA loan programme. In case the IMF authorities allow Pakistan nine months extension in the programme, it will end at an extended date instead of December 31.

Economic managers are confident of gaining the extension in the programme from the IMF authorities, official sources said.

gowda · Post by **gowda** » 23 Dec 2010 00:00

Source: http://www.dawn.com/2010/12/22/record-g ... ain-2.html

The record borrowing by the government and its heavy reliance on printing of notes created fears among the investors and analysts that the average inflation could even reach 16 per cent by the end of this fiscal.

The desperate need of cash seems to have forced the government to make unprecedented borrowing of Rs336 billion from the State Bank leaving no option for the latter to further tighten the policy interest rate.

The inflation fears already forced the central bank to raise the policy interest rate to 14 per cent last month despite serious resistance from business community.

While the business community fears further increase in the cost of borrowing, analysts see much higher inflation in near future. The government`s borrowing from the central bank is inflationary since more notes would be printed to meet the government demand.

For the budgetary support the government has already borrowed Rs416 billion compared to Rs278 billion last year. However, it retired Rs43 billion loans regarding commodity operations.

The government has also borrowed Rs82 billion through commercial banks. It was less than last year`s borrowing of Rs179 billion, which invited severe criticism from the State Bank and the independent economists, who said that no room was left for the private sector to borrow from the banking system.

“This printing of notes will further fuel inflation in the economy,” said Mohammad Sohail, chief executive of Topline Research.

“This may take the average Consumer Price Index (CPI) to 16 per cent for FY 11,” he said, adding that SBP may further tighten the interest rate.

Analysts see worst period for investors and other borrowers as the cost of borrowing could alienate them in the market already invaded by the cheaper products of neighbouring countries.

While millions have been seeking employment, jobs cuts are in pipeline since the economy could not perform with this high price of money, they said.

“If the situation prevails and the government continues to borrow through printing of notes, more miseries are there for the private sector,” said Khurram Shahzad, head of research at InvestCap.

He said banks would have to face more defaults of loans and the size of Non-performing Loans (NPLs) would be much larger.

FTA with China has cost the TSP dearly. It has destroyed local industry, increased joblessness, and ofcourse created higher than normal inflation. Lots of printed money chasing limited resources, a perfect recipe for a Zimbabwe like super inflation situation. We may soon see a million Rupee paki note with zardari's face on it.

Airavat · Post by **Airavat** » 23 Dec 2010 08:47

A delegation of Pakistani fruit and vegetable exporters is currently in Russia and is on the verge of finalising orders for potatoes

Ahmed said that potatoes are a large part of Russian cuisine and Pakistan had exported 2,000 tons of the vegetable a year ago. Russia also imports potatoes from Morocco, Saudi Arabia and Brazil. This year, Russia is facing a shortage of the crop and has decided to import additional potatoes.

Airavat · Post by **Airavat** » 23 Dec 2010 09:02

Wishful thinking

It is the question that every Pakistani hates answering when posed by a foreign investor: “Why should I not invest in India instead?” Yet this need not be an uncomfortable moment, for there is an answer that is likely to be music to the ears of an international investor: “Because our market is freer than India’s.”

Nearly two decades after it began the process of economic liberalisation, the pall of leftist policies still hangs like a cloud over many of India’s key economic sectors. The preamble to India’s constitution still describes the republic as being ‘socialist’. Pakistan, in some respects, is also an easier market to operate in – given the fact that an estimated 55 per cent of the population now lives in areas that can be classified as urban.

Of the eight largest banks in Pakistan, four are majority-owned by foreign investors. The London-based Standard Chartered Bank was able to acquire Union Bank in 2005.

Prem · Post by **Prem** » 24 Dec 2010 03:53

http://www.businessrecorder.com/news/to ... offer.html
Import of 263 non-FTA items: China withdraws offer

ISLAMABAD

(December 23, 2010) : China has reportedly withdrawn its unilateral offer to facilitate import of an additional 263 items from Pakistan out of Free Trade Agreement (FTA), sources in Commerce Ministry told Business Recorder. In the middle of current year, Commerce Secretary Zafar Mahmood had announced before the Advisory Council of Trade Policy that China would facilitate import of a number of additional items out of FTA."I have good news for the business community that China has offered to allow export of additional items from Pakistan out of FTA unilaterally," Zafar had announced before a packed auditorium of the Planning Commission. However, this has not materialised so far as China is not ready to consider any trade concessions to Pakistan out of FTA, and on unilateral basis, sources said. Most of the items included in the 'wish list' were from the textile, engineering, and chemical sectors, and fresh fruits and vegetables.The Commerce Secretary had also announced that financial impact of these additional items, if Beijing accepted the proposal, would be around 1-1.5 billion dollars per annum, on export to China. Chinese Vice Premier Zhang Dejiang, during his visit to Pakistan, had assured Prime Minister Yousuf Raza Gilani that four matters would be considered sympathetically. These were: (i) provision of a place for displaying of Pakistani goods in trade exhibitions, free of cost or at very cheap rates; (ii) dispatching buyers' missions for procurement for public sector; (iii) facilitation of additional Pakistani items for export to China; and (iv) training.
"What I know is that China wants to club the earlier offer with the FTA and on bilateral basis, which implies that it is not ready to honour the earlier open statement," sources added. The Commerce Secretary had proactively followed up with the Chinese government as member of President Zardari's entourage and at Free Trade Council meeting, but the result has been almost zero, sources said.Recently, Commerce Minister Amin Fahim and Commerce Secretary Zafar Mahmood had interacted with President Asif Zardari and Prime Minister Gilani in respect of logistical arrangements for Chinese Prime Minister Wen Jiabao's recent visit. Both the Presidency and the Prime Minister House had entrusted the Commerce Minister and Commerce Secretary with the responsibility of overseeing the arrangements of Pak-China Business Summit by the BoI and Ministry of Foreign Affairs.Insiders in the BoI said that handing over of Pak-China Business Summit arrangements to the Commerce Ministry was 'disrespectful' of the Board, which had been engaged in a number of MoUs. On a number of occasions, Pakistan lodged complaints that its exports had not been showing growth as per expectations and had requested the Chinese experts to include more Pakistani products in the FTA. Pakistan signed a number of MoUs and agreements with China during the visit of Premier Wen Jiabao. Commerce Secretary Zafar Mahmood was approached for comments but could not be reached despite hectic efforts through his office.

gowda · Post by **gowda** » 27 Dec 2010 20:04

ISLAMABAD: As thousands across the country mourn the loss of their assassinated leader, Pakistan Railways is worried about a loss of another kind. The anger and sense of grief that translated into acts of arson and vandalism on this day, three years ago left its mark on Pakistan Railways as well when 15 locomotives and 87 coaches worth millions of dollars were set on fire, and completely destroyed in Karachi and Sukkur divisions.
But even after three years, the Pakistan Railways (PR) has failed to repair or replace these locomotives and engines with the result that train services on many routes have been affected and many routes have been shut down altogether. The arson incidents and other such acts of negligence on the part of PR has all combined to push the ailing utility’s total losses to over Rs40 billion.
These coaches were imported as part of a multi-million dollar contract with China during the tenure of former president, General (retd) Pervez Musharraf. In this deal 69 locomotives and 250 coaches were imported. There were allegations of large-scale corruption in this deal because the coaches imported from China cost Rs50 million each, while the cost of producing one locally is reportedly about a fifth of the same.
According to official documents sent by the PR to the Senate Standing Committee on Railways, so far just three of the 87 destroyed coaches have been made usable again. And a source in PR told The Express Tribune that the management does not seem keen on the repair of this destroyed or damaged equipment.
The official documents also show that PR carried out an assessment of the damages and the amount that would be needed to repair the burnt coaches and locomotives. It was estimated that an amount of Rs600 million including foreign currency component of Rs409 million would be needed to make these coaches and locomotives usable again. A PC-1 was prepared to start this work, but so far only four locomotives have been made usable. The remaining 11 locomotives are just gathering more rust.
According to official documents, the Ministry of Railways, citing financial constraints decided to undertake this job in phases and has released just Rs17.5 million over the past three years for this repair work.
The delay in the release of funds has caused a delay in the import of parts to carry out these repairs, so for the time being, these coaches and locomotives are not going anywhere.
Published in The Express Tribune, December 27th, 2010.

Ameet · Post by **Ameet** » 28 Dec 2010 04:33

Pakistan asks India to keep up promise of cotton export

http://www.thehindu.com/news/national/article996001.ece

Addressing a press conference here, All-Pakistan Textile Mills Association vice chairman Shahzad Ali Khan pointed out that India exported only one lakh bales out of the contracted quantity of 10 lakh bales. What the industry needed was not just the entire contracted amount, but an additional quantity. India had so far exported about 30 lakh bales of cotton to other countries and was in a position to assist the Pakistani textile industry.

Urging India to “help a neighbour,” Mr. Khan expressed the hope that the remaining quantity of nine lakh bales would be shipped at the earliest. Pakistan faces a severe supply crunch on the raw cotton front due to floods in parts of cotton growing areas in the country. Pakistan lost about 25 lakh bales of cotton and faces an overall deficit of 40 lakh bales.

gowda · Post by **gowda** » 28 Dec 2010 05:51

Ameet wrote:Pakistan asks India to keep up promise of cotton export
Urging India to “help a neighbour,” Mr. Khan expressed the hope that the remaining quantity of nine lakh bales would be shipped at the earliest. Pakistan faces a severe supply crunch on the raw cotton front due to floods in parts of cotton growing areas in the country. Pakistan lost about 25 lakh bales of cotton and faces an overall deficit of 40 lakh bales.

Why the FLOODY BUCK is India exporting cotton to Pakistan?

Why don't we ban exports to Pakistan and completely destroy their their crappy textile industry? our textiles industry can use some reduced competition as well as benefit from lower cotton prices. its a double win. Ban cotton exports NOW!!!

shiv · Post by **shiv** » 28 Dec 2010 06:09

^^Gowdre, please add urls to your posts if they are quoting some site. If I need to archive something I need the url for later use.