PM MEETS AFGHAN PRESIDENT ON SIDELINES OF SCO SUMMIT
Prime Minister Nawaz Sharif met Afghan President Ashraf Ghani on the sidelines of the Shanghai Cooperation Organisation (SCO) Summit in Astana, Kazakhstan on Friday. The meeting comes amid escalating tensions between the two countries. Ghani on Tuesday accused Pakistan of waging an ‘undeclared war of aggression’ against Afghanistan as he launched a so-called Kabul Process aiming to set the stage for peace talks and clinch an international pact to end ‘cross-border terrorism’. “What will it take to convince Pakistan that a stable Afghanistan helps them and helps our region?” he had remarked before a gathering of 23 nations, the European Union, the United Nations and Nato. In this backdrop, Prime Minister Nawaz Sharif on Wednesday chaired a ‘special’ meeting of the National Security Committee (NSC) of the Cabinet ‘to review the issues of national and regional security’. A day earlier, PM Nawaz exchanged pleasantries with his Indian counterpart Narendra Modi at a reception in the Kazakh capital amid escalating tensions between their two countries over a range of issues. According to Outlook India, Modi and Sharif exchanged greetings when they were in the leaders’ lounge for the reception at the Astana Opera organised to welcome the leaders who are participating in the SCO Summit.
FRANCE INVESTORS IN PAK AFTER 12-YEAR
France has so far made an investment of $1.4 billion and the visit of French investors – after a gap of 12 years – will attract more investment in the near future, said Philippe Fouet, Head of Economic Department of the French Embassy in Islamabad. Speaking to members of the Faisalabad Chamber of Commerce and Industry (FCCI), Fouet said Pakistan and France were enjoying good relations and had the potential to promote bilateral trade. “Our imports and exports are far less than the existing potential, but positive indicators are very encouraging,” he said. He pointed out that during the first three months of this year, French exports had doubled while an 11% increase in Pakistan’s exports had also been recorded. Talking about French investment, Fouet said France had made maximum investment in energy, oil distribution and liquefied natural gas (LNG) imports. He acknowledged that the China-Pakistan Economic Corridor programme had strengthened Pakistan’s economy. “All macroeconomic indicators are positive, but both countries have to take fresh steps to further strengthen bilateral ties,” the envoy added.
KARACHI-HYDERABAD: M-9 LIKELY TO BE STARTED ON AUG-14
The National Highway Authority (NHA) is all set to complete the Karachi-Hyderabad Motorway (M-9) by August this year, almost seven months ahead of its scheduled completion date. The project is likely to be inaugurated on August 14, well before the time in view of its unusual importance as around 80% of the trade activities in the country are going to be linked with this route. The cost of the project is Rs44 billion and, once completed, it is likely to bring a revolution in terms of connecting the country’s vital economic centres with the upcountry by facilitating the movement of heavy commercial vehicles originating from the Karachi Port and Port Qasim. It will also facilitate the traffic coming from Karachi Northern Bypass (KNBP) and Makran Coastal Highway (MCH). Connecting the country’s two important commercial centres – Karachi and Hyderabad – the M-9 will carry around 35 thousand vehicles every day. These vehicles include 18-20 thousand heavy commercial vehicles originating from Karachi Port and Port Qasim. The project was started in September 2015 under public-private partnership as the government was short of funds to finance this project. The Frontier Works Organisation (FWO) is its contractor and concessionaire. The first 80km-long section of the motorway has already been successfully completed. It was inaugurated in February 2017. “It is one of the mega projects on which the government has not spent a single penny,” said NHA spokesperson Kashif Zaman.
AMID GLOBAL FALL, FOREIGN AID FOR EDUCATION IN PAKISTAN INCREASES
Despite a decline in the amount of aid allocated to education worldwide for six consecutive years, aid for education in Pakistan has increased with a majority of it being spent on basic learning, revealed a new policy paper on Thursday. According to the paper – Aid to Education is Stagnating and Not Going to Countries Most in Need – published by UNESCO’s Global Education Monitoring Report, the amount of aid allocated to education worldwide has been falling for six years in a row. However, a different trend has been observed in the report for Pakistan. The country received $649 million, the highest it had received so far. According to the data in the paper, the aid had increased from $586 million in 2014 to $649 million in 2015. The paper also reports that Pakistan received the most aid out of all the countries in Southern Asia, with India just behind receiving $589 million in 2015. The biggest part of the aid to Pakistan was given for basic education. Out of the total $649 million, $371 million or 57.16 per cent was given for basic education. According to the paper, total aid to education stands at $12 billion – 4.0 per cent lower than in 2010 – while total development aid over the same period increased by 24 per cent. Aid to basic education – which includes support to pre-primary and primary education as well as adult education and literacy programmes – stands at $5.2 billion, up from $4.8 billion in 2014. This amount is still 6.0 per cent lower than in 2010. Aid to secondary education, meanwhile, amounts to $2.2 billion, representing 19 per cent of the total aid to education.
BUDGET FY2018: PINDI RING ROAD PROJECT EXCLUDED FROM PUNJAB ADB
The Punjab government seems uninterested in starting work on the much-needed Ring Road project in the garrison city since it has failed to make any allocations in the Annual Development Programme of the province in the upcoming fiscal year 2017-18. A senior official of Rawalpindi Development Authority (RDA) said on Thursday that the multi-billion project had not apparently been excluded from the ADP. The official said that Lahore had approved five development schemes for the RDA in the budget. The schemes include remodelling Ammar Chowk, reconstructing the road from Tipu Road to Airport Road, re-carpeting the Airport Road from Koral Chowk to Noor Khan Airbase near the Benazir Bhutto International Airport, building an intersection at Noor Khan Base, and re-carpeting the Farooq-e-Azam Road. He said that absence of Ring Road project from the ADP showed that the Punjab government would not be providing funds for the proposed project which aims to connect GT Road at Rawat to the Motorway at Thalian. While expressing his surprise, the official said that a feasibility study for the project was currently underway after the RDA had hired NesPak as consultants for the project. A plan may be presented to the authority by end of the ongoing fiscal year. The Punjab government had been finding it hard to bring in private investment for the long-conceived project that which would provide a 38 kilometer-long corridor allowing heavy traffic such as trucks to by-pass the congested city.
AUTOMOBILE PART MAKERS SEEK REMOVAL OF REGULATORY DUTY
Pakistan Association of Automotive Parts and Accessories Manufacturers (Paapam) Chairman Mashood Ali Khan has stated that regulatory duty is damaging the auto engineering sector, pushing more companies towards closure. He called as unjustified the 30% regulatory duty on products that were not being produced in the country. Some of them that were being manufactured in the country were not of good quality that the auto industry needed. “The auto parts’ making industry is on the verge of collapse due to the regulatory duty imposed for three fiscal years,” said Khan. The duty was slapped at a time when the government believed that international steel prices would continue to remain low. But now, he said, international prices had been on a constant rise, making it even more difficult to bear the burden of regulatory duty.
“Many industrial units are nearing closure and up to 200,000 employees are on the verge of losing their jobs. Pakistan’s exports have dropped only because we have become 30% more expensive than our competitors due to this duty,” he added. As per the new five-year auto policy, which was announced on March 21, 2016 with a comprehensive tariff structure, he said, it was unjustified to modify its approved tariff structure through the levy of regulatory duty and additional customs duty on raw materials that were not manufactured locally.
KPK TO LAUNCH PENSION REFORMS TO COPE WITH GROWING LIABILITIES
Khyber-Pakhtunkhwa (K-P) Finance Department has decided to chalk out a comprehensive strategy for smart management of the province’s rapidly increasing pension liabilities of the employees. Pension liabilities of government employees are estimated at Rs53 billion in the budget 2017-18, which is 32% more than Rs40 billion in the outgoing fiscal year. Similarly, salaries and allowances have been raised from Rs189 billion in the current year to Rs218 billion in FY18, up 15.3%. During his budget speech in the K-P assembly a day ago, Finance Minister Muzaffar Said had termed the rapidly increasing salary and pension liabilities a challenge for the provincial government. Qadir admitted that the increase in the share of pensions and salaries was affecting the development programme. He said Pakistan had entered the ranks of middle-income countries, so it should adopt the pension policies and systems practised in those countries. The finance secretary claimed that K-P was the only province in the country that had no domestic loans. However, referring to foreign loans, he said K-P had Rs195 billion in such loans and had paid Rs13 billion in mark-up and Rs11 billion in principal in the current year. For the new fiscal year, the province will pay Rs8 billion on account of mark-up and Rs7 billion in principal.
GOVERNMENT TO BORROW ANOTHER RS41 BILLION TO PAY CIRCULAR DEBT
After being unable to address structural issues in the power sector, the government on Wednesday decided to acquire yet another loan of Rs41 billion from commercial banks to partially retire the circular debt. The decision will ease the power sector’s financial woes for the time being, but will not address the challenges that have led to the accumulation of over Rs402 billion in circular debt over four years of the current government. The debt piled up again after the government cleared Rs480 billion soon after coming to power in June 2013. Electricity consumers will pay the principal as well as interest on the Rs41-billion borrowing in their monthly bills. The beneficiaries of the loan will be independent power producers (IPPs), Pakistan State Oil (PSO) and Khyber-Pakhtunkhwa government. The cash injection, which will take one week due to procedural formalities, will allow the IPPs to generate more electricity at a time when the country is facing 8 to 10 hours of load-shedding in a day. The Economic Coordination Committee (ECC) of the cabinet agreed that the Ministry of Finance would issue sovereign guarantees for arranging a syndicated term finance facility of Rs41 billion for the power sector, according to a statement issued by the finance ministry. The borrowing will bring the energy sector’s circular debt down to around Rs360 billion. Ironically, the Rs41-billion borrowing will be parked in the government-owned Power Holding Private Limited, where Rs375 billion is already parked. Although the running power sector circular debt will come down to Rs360 billion, the stock of debt will go up to Rs415 billion.