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Dec 20, 1999

  1. International
  2. Finance
  3. Industry
  4. Policy
  5. Trade
  6. Gulf

Legalization of non-duty paid vehicles

The Central Board of Revenue (CBR) announced an extension in deadline for legalization of non-duty paid smuggled vehicles by January 31, 2000.

The owners of such vehicles would be made eligible to legalize the same on payment of assessed duty and taxes without imposition of any fine.

According to CBR, almost 3,500 smuggled cars/jeeps were legalized in May, June 1998 on payment of duty and taxes while, almost 4000 heavy transport vehicles were similarly legalized in the amnesty scheme some months back.

CBR exempts ST on frozen-meat, poultry

Central Board of Revenue has announced sales tax exemption on frozen and retail-paced meat and poultry.

Though an amendment made under an Ordinance promulgated on Dec 16,1999, the CBR says: The sales tax 1990 stands amended and an exemption has been granted to meat and poultry which is frozen and retail packed.

The purpose of this amendment is to protect the nascent meat and poultry processing and packaging industry in order to provide hygienic product to the consumers.

Relief package

Chief Executive General Pervez Musharraf in its relief package on Wednesday announced an ad hoc increase in the salary of the low-paid employees, 48 per cent raise in the old age pension, and withdrawal of 10 per cent withholding tax on saving schemes.

Gen Musharraf, as step to compensate the recent increase in the petroleum prices, announced an increase of Rs100 per month on ad hoc basis in the salary of the employees in grade 1 to 16 from Jan 1,2000.

SBP for cut in imports, quick-yield projects

Economy had to sail through troubled waters in fiscal (July/June) 1998-99, with the result that the average income of a Pakistani throughout the year remained below $400.

The year ended with an exceptionally large balance-of-payments deficit of $3.277 billion against only $306 million in 1997-98, according to the State Bank annual report 1998-99 released here on Tuesday.

Foreign debt rose by $1.65 billion to $30.3 billion in 1998-99 but the debt service payments declined to $2.6 billion from $4.7 billion in 1997-98 because of rescheduling of debt servicing of $3.1 billion by the Paris Club and that of $834 million by London Club creditors.

"...The burden of debt servicing continues to be the most challenging problem for Pakistan," says the report, adding that "over the past several years the continuation of certain structural weaknesses has made the external sector most vulnerable to external shocks."

The report underlines the need to make the external sector strong enough to resume servicing of external debt— without any rescheduling—from January 2001.

The report reveals that the total national debt rose by Rs441.9 billion to Rs2,927.4 billion or 96.7 per cent of GDP on June 30, 1999, up from Rs2,485.5 billion or 90.8 per cent of GDP at end of June 1998. Of this foreign debt was Rsl,565 billion or 51.7 per cent GDP and domestic debt Rsl,362.4 billion or 45 per cent of GDP. In dollar terms, foreign debt stood at $30.3 billion on June 30, 1999, up from $28.7 billion a year ago.

The report says the budget deficit declined by 2.2 per cent of GDP to 3.4 per cent as compared to 5.6 per cent in 1997-98, adding that the deficit comes to 4.3 per cent if adjustments are made against one time receipts of some items. "Although the recent fiscal deficit GDP ratio has shown a declining trend, the overall budgetary position continues to be an area of concern for the economic managers," observes the report.

$5m IBRD loan for poverty alleviation

The World Bank has released the first tranche of 5 million dollars out of the promised amount of 90 million dollars for the poverty alleviation programme in Pakistan.

This programme is being executed through Pakistan Poverty Alleviation Fund (PPAF), an organization incorporated recently. Headed by a well known industrialist Hussain Dawood, the PPAF will enter into partnership with the non-government organizations (NGOs), voluntary agencies, societies and community groups to offer financial, advisory and training assistance for the empowerment of the poor sections of the population in both the rural and urban areas of the country.

Rs 1.25bn LC for Hubco

A syndicate of local banks led by United Bank has finalized an agreement for establishing Rs 1.25 billion worth of letter of credit on behalf of Hubco in favour of Pakistan State Oil. The syndicate members are: Faysal Bank, Bank Al-Falah, Gulf Commercial Bank and Prudential Bank, says a press release. Under the agreement, Hubco has arranged the issuance of LC for purchase of fuel to PSO for the year 2000.

Corporate restructuring

Finance Minister Shaukat Aziz said, the government will establish a financial institution, to be known as the Corporate and Industrial Restructuring Corporation, to help revive sick industrial units.

Raise in prices of cement

The government has decided in principle to allow cement manufacturers to increase the cement prices from 5 to 10 percent due to recent hike in the prices of furnace oil and imposition of GST on electricity. Sources said that cement manufacturers have been asked to submit detailed report on the cost of production due to increase in the furnace oil prices and imposition of GST on electricity.

Altaf Saleem appointed PC chairman

The military government has appointed Altaf Saleem as the new Chairman of the Privatization Commission.

Minister for Finance Shaukat Aziz told reporters here on Thursday at a news conference that Altaf Saleem was a prominent industrialist from Lahore and was a suitable person to head the Privatization Commission.