developed countries have recognized the importance of Small
Medium Enterprises (SMEs) which play an important role in the
development of national economy. In Indonesia, United Kingdom,
South Korea, Thailand, China, USA, Bangladesh etc, SMEs have
historically been the main players in the domestic economic
activities especially as providers of employment
opportunities. SMEs are the starting point of
development in the economies towards industrialization as well
as significant effect on the income distribution, tax revenue
PAGE TOP STORIES
& PAGE SPECIAL REPORTS
COMMERCIAL BANKS PARKING BULK OF THEIR MONEY
IN GOVT PAPERS LEAVING A LITTLE FOR SMEs
ZULFIKAR THAVER, PRESIDENT UNION OF SMALL & MEDIUM ENTERPRISES
The government needs
to ensure uninterrupted energy supply to the SME units either
through electricity or alternate energy like solar, wind or
biomass in the rural areas so that the SMEs could contribute
their due role in developing of the economy. The cost of
electricity is also too high as compared to per capita income
in Pakistan, it is the need of the hour that the government
should reduce the taxes on consumption of electricity to give
a breathing space to the industrial, commercial and domestic
consumers. Making utilities as tax collecting agency is not
fair as the consumers are forced to pay indirect high taxes
irrespective to their income level.....
DORMANT SME SECTOR
STILL REMAINS THE RAY OF HOPE FOR ECONOMIC GROWTH INTERVIEW WITH MR KHALID
TAWAB, CHAIRMAN TAWAB GROUP
industry in Pakistan is mostly labor intensive with a low
level of automation having high defect rates and low
efficiency levels. As a result, it is facing serious problems
in increasing, or even sustaining its share in the global
market, causing unemployment in different major industrial
sectors. The situation is worsening due to current energy
shortfall. The increasing input costs and decreasing profit
margins are causing threats to manufacturing; among others,
the survival of Small and Medium Enterprises (SMEs) is
becoming difficult day by day. However, the government
statistics show that Pakistan’s SMEs sector recorded an
impressive growth of 14.7 percent during 1987-88 and 1996-97
when the estimated value of its output increased from Rs19,683
million to Rs67,541 million........
MEEZAN BANK TO SUPPORT SHARIAH-COMPLIANT BRANCHLESS
Limited entered an agreement to provide Shariah technical
services and support and Branchless Banking services to Edbiz
Consulting (Pvt) Ltd in collaboration with State Bank
of Pakistan. Mr. Irfan Siddiqui, President & CEO, Meezan Bank
Limited, Mr. Humayon Dar, CEO, Edbiz Consulting and Mr. Saeed
Ahmed, Director Agricultural Credit & Microfinance Department
of State Bank of Pakistan signed the agreement.
State Bank of
Pakistan (SBP) is implementing the Financial Inclusion Program
– Financial Innovation Challenge Fund (FICF), sponsored by the
UK Aid, with the aim to improve access to financial services
FOCUS ON VIBRANT EDUCATION IN PAKISTAN
champions and stalwarts, political heavy weights and religious
scholars never tired to dilate upon the significance of
education for decades and decades in Pakistan but the ground
reality exposes the sincerity to the purpose, policies and
programs as even after 68 years of creation of this country
the budgetary allocation for education is only 2 percent while
a huge population is forced to live below poverty line in our
Officially speaking, some 15 million children never go to
school but the actual figure is much higher.
It is unfortunate that the sanctity of education has been
damaged by excessive commercialization of education as this
has become the most lucrative business in Pakistan..........
A VITAL ROLE IN WIPING OUT POVERTY
industry has been showing a spectacular annual growth rate of
over 30 percent over the past five years with sustained growth
momentum despite substantial increased base. Islamic Banking
has been expanded across 80 districts of the country with a
network of 304 branches offering Shariah-compliant products
outlook of the industry is also very positive with bright
prospects of doubling its market share by 2020.
The market share of Islamic banking assets and deposits in
overall banking industry increased to 11.2 percent and 12.1
percent respectively by end of December 2013. The Consultative
Group Against Poverty (CGAP), a World Bank initiative,
estimates that roughly 72 percent of individuals in
Muslim-majority countries are not using formal financial
SMEDA FACILITATES SMEs TO OVERCOME
Today SMEs are widely
regarded by experts as the panacea for many economic problems
confronting different countries particularly less developed
ones. In particular, vibrant small-scale sector —
incorporating the informal firms — is expected to resolve a
variety of problems, including unemployment, low growth and
poverty. SMEs constitute nearly 90 percent of all the
enterprises in Pakistan; employing 80 percent of the
non-agricultural labor force and their share in the annual GDP
is 40 percent, approximately.
SMEs working in industrial
sectors such as agriculture, fisheries, textiles, handloom
weaving, transport, leather, marble & granite, carpets and
However, unlike large
enterprises in the formal sector, a small and medium
enterprises (SMEs) are constrained by financial and other
TANKER MARKETS ON THE RISE
Fortunes are quickly shifting in the tanker markets, both
the clean product tanker trades, as well as the crude tanker
As such, owners are easily drawn into trades that while make
sense at the time, can quickly backfire. According to the
weekly report from shipbroker Intermodal, “when it comes to
“wet” trends, during the last twenty months, we have gone from
the highly publicized “product story” to the “crude revival”.
Less than two years ago MR tankers were
being ordered in a frantic pace, with hopes
that the beginning of the wet sector revival
was to be found somewhere in the medium
INFLUX OF IMPORTED CEMENT HITS DOMESTIC
The cement manufacturers of the country have drawn the
attention of Chairman, Federal Board of Revenue (FBR) towards
the illegal import of cement from Iran that is affecting the
local industry and revenues to the government.
Senior Vice Chairman, All Pakistan Cement Manufacturers
Association (APCMA), Sayeed Tariq Saigol has written a letter
to Chairman FBR, Mr. Tariq Bajwa drawing his attention towards
the illegal import of cement from Iran which is being sold in
the local market at much lower rates.......
COMMON MAN RESPITE – NO RAISE IN POWER TARIFF
For the relief of the
common man, the government is not going to raise power tariff
this month as per demanded by the International Monetary Fund
while other adjustments would be made to ensure release of
delayed fifth tranche worth about $550 million by the Fund,
this was said by the Finance Minister Ishaq Dar while
addressing a joint press conference with Minister for
Information and Broadcasting, in Islamabad last week. Earlier,
there were reports that IMF has asked Pakistan to increase the
power tariff by six to seven percent before getting next
tranche worth of $550 million...........
MORE SIGNIFICANT STEPS CALL FOR POVERTY ERADICATION
Most of the nations of the world
explain poverty in a unidimensional way, using consumption or income level. In
developing states, consumption is more suitable than income as welfare
In Pakistan household consumption is
utilized as a welfare indicator. Poverty lines are the thresholds, which divide
the poor from non-poor. Microfinance is also recognized as an effectual
indicator to combat poverty through offering financial services to those who
don’t have access to or are neglected through the financial institutions and
POLICY PLANNERS HAVE NO COMPREHENSION OF SME POTENTIAL
Whatever the policy
makers say or do, it could be said without any doubt that they
don’t have any comprehension of the SME potential. Around the
world SMEs have the largest contribution in the GDP of any
country as the blue chip companies, large corporate,
multinational companies and conglomerates are dependent on the
raw material and intermediate products supplied by the SMEs.
This could be best understood if one looks at automobile
industry of Pakistan. There are less than half a dozen
assemblers operating in the country but these are dependent on
nearly 100,000 vendor units..
GAINING AGRICULTURAL YIELDS THROUGH ECO-FARMING STRESSED
ensures healthy farming and healthy food for today and
tomorrow, by protecting soil, water and climate, promotes
biodiversity and does not contaminate the environment with
chemical inputs or genetic engineering.
provides the ability of communities to feed them selves and
ensures a future of healthy farming and healthy food to all.
It also protects soils from erosion and degradation, increases
soil fertility, conserves water and natural habitats and
reduces emission of greenhouse gases...........
INDIA IN THE NEWS
an acronym for Indian Design Mark, could be a powerful motif for micro, small
and medium enterprises (MSME) in Bengal to impress and get a bigger slice of the
world market, said experts.
"Traditionally, West Bengal is home to many MSMEs which make a wide variety of
products. What they need is a greater focus on and more investments in design to
move up the value chain," said Pradyumna Vyas, director of the National
Institute of Design (NID), at the Design Conference-Cum-Seminar organized by CII
in Kolkata. MSMEs across the country apply for I-Mark, he added..........
IN THE NEWS
Co-ordination Committee (ECC) of the Cabinet has not considered a proposal on
the import of fertilizer through open tenders to meet the indicated shortfall of
600,000 tons of urea for the Rabi crops. The meeting chaired by Finance Minister
Ishaq Dar approved the import of 185,000 tons of urea from Saudi Basic
Industries Corporation (SABIC) and directed Ministry of Industries and
production to put up a detailed proposal before the next ECC meeting for the
remaining requirement of 415,000 tons......
Dubai: Dubai is
becoming more affordable to live and work in, according to a
report released on Tuesday by UK-based property group, Savills.
The emirate is ranked the world’s 9th most expensive city for
companies to locate employees, overtaking the likes of
Shanghai and Rio De Janeiro, according to the Savills report.
The ranking has dropped a notch since 2008 when Dubai was
placed 8th in the index.
London, meanwhile, was ranked the world’s most expensive city
for companies to locate employees, overtaking Hong Kong, which
had topped the ranking for five years. Hong Kong was followed
by New York, Paris, Tokyo, Singapore, Moscow and Sydney.....
Zarai Taraqiati Bank Limited (ZTBL) and
the Institute of Cost and Management Accountants of Pakistan (ICMA Pakistan) on
the 18th September, 2014 signed a Memorandum of Understanding (MoU)
under ICMA Pakistan’s corporate partnership scheme for business organization.
A signing ceremony in this regard was held here in ZTBL, Head Office. The MoU
was signed by Syed Talat Mehmood, President ZTBL and Mr. Zia ul Mustafa,
President ICMA Pakistan. The Bank’s executives were also present on the
PHYSICAL ONE-STOP SHOP SET TO BE ESTABLISHED
Taking a giant leap
forward in terms of building a world class facilitation
business community, Federal Board of Revenue (FBR), Securities
& Exchange Commission of Pakistan (SECP), Employees Old Age
Benefits Institution (EOBI) and Lahore Chamber of Commerce &
Industry (LCCI) this Saturday signed a Memorandum of
Understanding (MoU) to establish Physical One-Stop Shop at the
LCCI premises to facilitate business community to get
registration of SECP, FBR and EOBI...........
Board of Revenue (FBR) and Department for International
Development (DFID} of United Kingdom signed a Memorandum of
Understanding (MoU) to improve the taxation system and enhance
revenue generating process significantly. The MoU was signed
in Islamabad last week by Head of DFID for Pakistan, Richard
Montgomery and Chairman FBR, Tariq Bajwa. Federal Minister for
Finance, Senator Ishaq Dar and British High Commissioner to
Pakistan, Phillip Barton witnessed the signing ceremony.............
ROLE OF SMES AND ITS BENEFITS ASSOCIATED WITH ONGOING BUSINESS
In today’s times,
small and medium enterprises (SMEs) are seen to be a universal
solution to a majority of the problems being faced by the
less-developed countries. Unemployment, lack of economic
growth, and poverty are some of the problems, which are
expected to be solved under this small scale sector. The faith
in SME is constantly on the rise as the concept of
manufacturing occurring anywhere is on the rise. This is
because since production methods are now more flexible,
manufacturing can occur anywhere and at any level.......
As On Sep 26, 2014
TAMEER BANK TIGHTENS GRIP ON MICRO LENDING, SAVING PROSPECT
Tameer Micro Finance Bank Limited is
the first scheduled Micro Finance Bank in Pakistan and a majority owned
subsidiary of Telenor Pakistan. It offers micro finance and related financial
services to the unbanked section and less privileged of the society.
The Bank presently has over 134 client
touch points through more than 45,000 branchless banking agents, along with
greater than 40,000 easypaisa agents, countrywide. The Bank provides a wide
range of financial services including mobile accounts, remittances, loans,
deposits, health insurance, cash management services and bank on wheels. Tameer
Bank has partnered with domestic insurance firms to offer health insurance
facilitates at hundreds of panel hospitals countrywide.......
“I’ve seen the power of microfinance all over the world in
the eyes of mothers and fathers. It’s unmistakable—the joy and deep satisfaction
they feel from being able to work hard and provide for their children and their
“Small loans can transform lives, especially the lives of
women and children. The poor can become empowered instead of disenfranchised.
Homes can be built, jobs can be created, businesses can be launched, and
individuals can feel a sense of worth again.”
“This is not charity. This is business: business with a
social objective, which is to help people get out of poverty.”
"I know of no more encouraging fact than the unquestionable
ability of man to elevate his life by conscious endeavor. "
HENRY DAVID THOREAU
"The key to ending extreme poverty is to enable the poorest
of the poor to get their foot on the ladder of development. The ladder of
development hovers overhead, and the poorest of the poor are stuck beneath it.
They lack the minimum amount of capital necessary to get a foothold, and
therefore need a boost up to the first rung. "
JEFFREY D. SACHS
"Microfinance recognizes that poor people are remarkable reservoirs of energy
and knowledge. And while the lack of financial services is a sign of poverty,
today it is also understood as an untapped opportunity to create markets, bring
people in from the margins and give them the tools with which to help
BRANCHLESS BANKING: THE FASTEST GROWING SEGMENT IN PAKISTAN
Communication Technologies (ICT) have transformed the global
economy bringing about a revolutionary change in the financial
sector. This revolution finds manifestations today in shape of
innovative banking products and services such as Automated
Teller Machines (ATMs), Internet banking, tele-banking and so
on. Online banking has introduced non-traditional channels of
delivering services in the banking industry.
needs to place ICT on its priority list to keep pace with the
advancement in technology and minimize digital divide. The
government needs to take measures for creating a conducive
environment for technological innovation and its effective use
in financial sector...........
Amidst no change in
policy rate by the State Bank of Pakistan (SBP) and a spur of
negative news inflow, the market closed in the red during this
past week, falling by a nominal 1.03%WoW to close at 29,706
points. Severity of news inflow regarding continuity of GIDC
through a presidential ordinance, potential 20% increase in
gas prices excluding domestic consumers and the GoP’s plan to
sell a stake in OGDC likely at a discount to current market
price kept the KSE-100 Index under pressure.
Broader news flow included: 1) pauses in decision making
amidst populist considerations delaying planned 7% increase in
power tariffs by the GoP and putting into question future IMF