Balochistan government has
decided to use additional perennial water to bring under plough another 5,13,000 acres of
land to augment agriculture produce in canal irrigated areas of Nasirabad division of
An official spokesman said that feasibility process would soon be
undertaken at an estimated cost of Rs 20 million.
He said on Thursday that there were five alternatives to make use of
2,500 MAF of water made available to Balochistan under 91 apportionment accord on Indus
water and flood flows.
Sindh cuts development outlay to Rs7.910bn
Sindh's development outlay of Rs7.910 billion during 1999-2000 is
smaller than the budget estimates (Rs8.710 billion) as well as revised estimates of
(Rs8.278 billion) for the outgoing year, primarily due to lower federal assistance.
It has three main components: Annual Development Programme Rs4.00
billion; Tameer-e-Sindh Programme (TSP) RsO.50 billion and foreign-aided projects Rs3.41
The ADP 1999-2000 is going to be largely funded through federal
assistance (Rs2.76 billion), provincial contribution (Rsl.213 billion) and Japanese grant
There is a sharp decline in federal assistance from original estimates
at Rs3.434 billion in 1998-99 to revised estimates of Rs2.764 billion, the level at which
the allocation has been made for next fiscal.
The provincial funding for ADP for 1999-2000 has been raised to Rsl213
million from the original estimates of Rs842.852 million and revised estimates of Rs
1081.8 million of the previous year. However, Japanese grant remains unchanged and is of
the same size as of 1998-99 i.e. Rs22.5 million.
Dar discusses revival of sick units
Finance Minister Mohammad Ishaq Dar expressed concern at the delay in
processing the cases of sick industrial units and directed the Banks/DFIs to finalize all
such cases in 45 days.
The minister, who chaired a meeting here this afternoon to discuss
measures for expeditious revival and restructuring of sick industrial units in the
It was decided in the meeting that section 296 of the companies
ordinance dealing with measures for revival of sick industrial units be enforced which has
been inoperative so far. In pursuance of section 296, the government would notify a high
powered committee comprising of heads of Banks/DFIs to prepare packages for rehabilitation
of sick industrial units. The committee would be headed by Mr. Tariq Hameed and include
Mr. Shaukat Mirza and Mr.Humayun Elahi Sheikh.
ADBP to pay tractor makers after 3 months
Tractor makers will have to wait for three months to get payment on
sale of units because of liquidity crunch being faced by the major creditor, Agriculture
Development Bank of Pakistan (ADBP).
Industry sources said the ADBP, which used to clear the payment within
a week, has informed assemblers that they would have to wait for 90 days.
Companies can get away with token dividends
An extra 10 per cent tax on the companies' excess reserves to force
them to pay dividends is unlikely to benefit stock investors.
Experts said companies could still get away with paying token dividends
to investors as this new measure did not set minimum limit for the dividend pay-outs.
"I think government cannot achieve its objective unless it fixes
minimum limit of dividend payouts," Arif Habib, former chairman, Karachi Stock
He said issue was not that companies did not pay dividends, but they
paid less dividends to the investors.
The measure has been announced in the federal budget to increase the
cash yield of the stock markets by levying an extra 10 per cent surcharge on reserves in
excess of 50 per cent of companies' paid-up capital if they fail to declare cash dividends
out of profits within seven months of their year ending.
This measure would not be applicable to modarabas and scheduled banks.
According to financial results based on 1998, there were 65 companies
out of total 769 listed companies whose reserves were more than 50 per cent of their
But majority of these companies paid out small cash dividends or
bonuses and they do not fall under this new law.
The cash-dividend yield of the Karachi Stock Exchange's 100 companies
was about 10 per cent in 1998.
Stock market experts said this was not a satisfactory return keeping in
view the risk attached to the Pakistani market. As compared to stock market, the return in
the fixed-income securities is much higher where the risk is also much less.
"We had proposed that 50 per cent of companies distributable
profits should be paid out as dividend or they should be comparable with the return on the
fixed-income instruments," said Yasin Lakhani, President, Karachi Stock Exchange.
In Pakistan, usually companies having large market capitalization pay
regular dividends to the investors whereas small companies run by family management have
very poor dividend payout history.
Tax holiday for EPZ expires
Investments in Export Processing Zones (EPZs) are becoming Unattractive
as against other free zones of the region because several exemptions allowed to them under
income tax, labour laws etc. have either lapsed or are going to expire in due course of
'Even existing industrial units would not enjoy these exemptions once
they expire and that is going to put our investments at stake because of glaring
disadvantage against other zones of the region,' director of a garment unit in Karachi
Export Processing Zone (KEPZ) said.
At the time of inception of Karachi Export Processing Zone (KEPZ) in
the year 1983-84, a 15 years tax holiday was given which today stands expired. If
extension was not given many investors in KEPZ feel it would not only discourage new
investment but would result in pulling out of the existing investment from the zone, he