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Agri exhibition to start on Feb 10 in Larkana

The Sindh Enterprise Development Fund is going to hold the seventh edition of the Livestock Dairy Fisheries Agriculture Exhibition and Seminar 2018 (LDFA 2018) in Larkana, called Shehr-e-Benazir, on February 10 and 11.

The objective of organising the fair in Larkana is to showcase and highlight the agri-economy of Larkana and nearby districts which produce approximately two million tons of paddy, said Agriculture, Supply and Prices Department Secretary Sajid Jamal Abro.Briefing at the Sindh Board of Investment (SBI), he said that out of the total rice production in the province, 90% was being exported to Africa, the Middle East and Far East.

Abro said rice producing countries like China, India, Indonesia, Bangladesh, Vietnam and Thailand were far ahead of Pakistan in terms of farm practices, crop yields and production technology.

The exhibition will highlight clusters of rice, poultry, dairy, livestock and fish farming. It will also showcase the warehouse receipt-based financing model for agri-commodities, which is being piloted by Sindh. It will revamp agri-financing in line with the mechanism adopted in the developed world, he said.

“The event will provide an update on the Entrepreneurship Development Programme launched last year at the Sindh Agriculture University (SAU) in Tando Jam. It will introduce ‘agripreneurship’ among agriculture graduates, equipping them with an insight into the international market.”

FBR misses tax collection target by Rs74 bn

The federal government has collected over Rs2 trillion in taxes during the first seven months of the current fiscal year, but fell short of the target by Rs74 billion, as the growth in collection slowed down to 17.7%.

The shortfall will make it difficult for the government to achieve the revised budget deficit target despite decent revenue collection by the Federal Board of Revenue (FBR). The shortfall may add about 0.3% of gross domestic product (GDP) to the budget deficit. Parliament has set the budget deficit target at 4.1% of GDP.

In the first seven months of 2017-18, provisional net revenue collection was recorded at over Rs2 trillion, announced the FBR headquarters on Wednesday. The collection was higher by 17.7% or roughly Rs300 billion over the same period of the previous fiscal year.

Parliament has approved Rs4.013-trillion tax collection target that needs a 19.2% growth.

For the first seven months (July-January), the FBR had set the target of Rs2.074 trillion. However, the FBR management appears confident about its performance. When the present government took over in 2013, the net revenue collection for the entire year was less than Rs1.95 trillion, said the FBR in a statement.

Provisional collection for January 2018 was Rs272 billion excluding the collection on account of book adjustment, which may range between Rs2 and Rs3 billion, said the FBR. It had set Rs273-billion target for the month.

The FBR said the monthly collection figure was very encouraging as in January 2017 Rs228 billion had been collected and there was an increase of 19%.

However, a main reason for the substantial increase in customs duty collection was the levy of regulatory duty on hundreds of tariff lines to curb imports. Historically, the share of customs duty had been one-tenth in the total revenue collection, but it has now almost doubled.

Owing to the regulatory duty, the share of customs duty collection in total taxes jumped to 15% by the end of last fiscal year, showed the Fiscal Policy Statement 2017-18. This further went up to 16.5% in the first seven months of the current fiscal year.”To bolster macroeconomic stability, revenue mobilisation should be given priority along with rationalisation of current expenditures,” according to the Fiscal Policy Statement 2017-18.

The latest revenue collection results have dimmed hopes of achieving the annual tax collection and fiscal deficit targets. The Rs2-trillion collection in the first seven months was only 49.8% of the annual target.

PAK, EU to cooperate in energy conservation

Pakistan and the European Union have agreed on cooperation in energy conservation and energy efficiency.

In this regard, the power division will send a high-level delegation comprising government officials and private-sector experts to the EU for participation in a workshop with European experts and professionals.

The understanding was reached in a meeting between Federal Minister for Power Division Awais Ahmed Khan Leghari and EU Ambassador Jean-Francois Cautain on Wednesday.

They also agreed that the European Investment Bank would be invited to the workshop in order to explore different options relating to financing energy projects in Pakistan. The envoy said the investment bank was keenly examining the fast expanding power sector in Pakistan and it would be considering assisting the country in running tube wells on solar power in Balochistan.

He highlighted that the EU was already working closely with the Khyber-Pakhtunkhwa government on a number of renewable energy projects, most of which were hydroelectric power plants.

He assured the minister that the EU would continue to provide assistance to Pakistan in the energy sector.

Referring to the planned workshop in the EU, Leghari said after bridging the demand and supply gap, now it was highly important that Pakistani consumers should be educated about the consumption of electricity.

PAK revives hope of recovering $800 mn from Etisalat

After putting recovery of $800 million from Etisalat on the backburner eight months ago by terming it a “sensitive matter”, the PML-N government has again expressed hope of getting outstanding amount from the Dubai-based firm.

A delegation of Etisalat – a telecom giant of the United Arab Emirates – is again in Islamabad, and met Prime Minister Shahid Khaqan Abbasi on Tuesday to discuss the issue of the $800 million in outstanding dues, according to Privatisation Secretary Irfan Ali.

It was the second visit by Etisalat in the last one month. The company has defaulted on $800 million it owed Pakistan on account of privatisation proceeds of Pakistan Telecommunication Company Limited (PTCL).

In July 2005, Etisalat had bought 26% shares in PTCL with management control at a price of $2.6 billion. After coming to know the second lowest bid was actually $1.4 billion, the UAE-based firm tried to backtrack from the offer.

Then Privatisation Minister Abdul Hafeez Shaikh lured the company by offering it to make an initial payment of $1.4 billion and the remaining amount in nine installments until September 2010. Moreover, he committed to transferring the properties owned by PTCL to Etisalat.

Pakistan served a second shortfall notice to Etisalat in September 2015, informing the company that it cannot transfer the remaining 33 properties and that it would have to pay the outstanding dues by adjusting the value of these properties, according to secretary privatisation.

 

The secretary said that according to Pakistan’s assessment the value of these properties was not more than $88 million. But according to the agreement, the highest value determined by any of the two parties will be the final price of the properties.

In our assessment there would not be a major difference between the valuation determined by Pakistan and Etisalat, Minister of Privatisation Daniyal Aziz told.

For two years, Etisalat was not ready to discuss the issue but now the company is willing to consider the valuation clause, said the privatisation minister, adding that Etisalat would take about six to seven weeks to finalise its own valuation of the 33 outstanding properties.

After all these years, we are now satisfied that the matter will be resolved soon, said Aziz.

However, there seems to be a wide gulf between the valuations from both parties.

About three years ago, the then Privatisation Commission Chairman Muhammad Zubair told the Public Accounts Committee (PAC) that Etisalat did not share its valuation with Pakistan but, according to information, it was over $450 million. He said the firm had submitted its valuation to the escrow account agent of HSBC Bank, London.

The secretary said that Etisalat is now inclined to settle the issue but lately the company’s lawyers raised some more questions which the government is trying to sort out.

After showing it as part of privatisation proceeds for years, former finance minister Ishaq Dar had excluded the $800 million in arrears from the privatisation of PTCL from the budget books.

The secretary privatisation said that the UAE telecom giant is willing to consider the valuation of 33 properties of PTCL. Irfan Ali said that the primary reason for non-recovery from Etisalat was because of its exceptionally high bid for PTCL.

Cabinet censures textile ministry for ignoring growers

Members of the cabinet have admonished the Ministry of Textile Industry for safeguarding the interest of industrial lobbies while ignoring cotton farmers.

They have suggested that administrative control of the cotton commissioner and the Pakistan Central Cotton Committee (PCCC) should be handed over to the Ministry of National Food Security and Research from the textile ministry in order to protect the growers.

Farmers feel they have been left at the mercy of the textile ministry which is looking after the interests of textile millers and has managed to get duties reduced on cotton imports. In recent years, according to experts, cotton production has fallen short of the target in the absence of incentives for the farmers because of lower prices in the country.

In a cabinet meeting held in the second week of January, most of the members backed the food ministry’s stance, arguing that cotton production and related subjects should fall within the ministry’s purview.

To support their argument, they pointed out that the food ministry was already dealing with the areas of pesticides and research.

Noting the conflict of interest between the growers and industrialists, they found that the textile industry was making profits whereas the farmers were earning virtually nothing. Separately, the PCCC has failed to take measures to increase cotton production.

The Ministry of National Food Security recalled that in a meeting held on September 5, 2017, the prime minister had approved, in principle, the transfer of issues pertaining to the cotton crop and the PCCC to the food ministry.

PAK’s debt-bearing capacity has deteriorated, admits govt

In a rare admission, the government has confessed before the National Assembly that Pakistan’s external debt bearing capacity has deteriorated further last year, as except one all external debt sustainability indicators have weakened.

In its Debt Policy Statement 2017-18, which the finance ministry submitted to the lower house of parliament, the government has admitted that during the last fiscal year the country’s external debt has increased at a rapid pace than its foreign exchange earnings.

It was the highest ratio after the one recorded during the last year of the PPP government.

Not only that, Pakistan’s external debt in percentage of foreign exchange reserves also increased to the three years highest level. Similarly, the cost of external debt servicing in percentage of foreign exchange earnings significantly increased –also the highest than the last year of the PPP.

The Debt Policy Statement 2017-18 has been submitted to the National Assembly as per the requirements of the Fiscal Responsibility and Debt Limitation (FRDL) Act of 2005 aimed at allowing legislators to assess the government’s failures and successes in managing the public debt.

However, some parts of the FRDL Act of 2005 have been rendered ineffective after the government’s decision to introduce sweeping changes to the law aimed at hiding its failures by changing the goalposts.

Despite changing goalposts by amending the law, there were certain areas where the government could not show improvement. However, it was able to claim progress in certain other areas.

Headed by its Director General Ehtesham Rashid, the Debt Policy Coordination Office prepared the statement in the light of the FRDL Act.

The external debt increased to 120% of the foreign exchange earnings by the end of FY 2016-17, showing that Pakistan’s debt-bearing capacity has weakened. It is consecutive second year when the ratio has slipped. In fiscal year 2015-16 year the ratio was 110%.

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