Sep 11 - 17, 2000

Furnace oil price up by Rs372

Pakistan State Oil (PSO) on Tuesday raised the furnace oil price (ex-Keamari) by Rs 372 per metric ton to Rs 10,634 per metric ton from Rs 10,262 per metric ton.

The new price became effective from Tuesday's morning after the decision taken in the meeting on Monday, a senior official in the PSO told. This is the second increase in the last one week by the local oil marketing company, which dominates the fuel oil market.

He said the prices have been jacked up due to upward drive in international oil prices, which on Tuesday soared to $158 per ton. The new price has been increased after calculating and adjusting the impact of general sales tax, increase in one per cent additional tax on imports and withdrawal of central excise duty on import and sales of furnace oil, the official said.

He said this is the lowest impact which we have passed on to the consumers otherwise the full impact will add fuel to the plight of the customers.

In the last week of August, PSO had pushed up the prices to Rs 10,262 per metric ton when the international prices was being quoted at $149 per metric tons.

PSO official said that global prices of oil has been going up since last one week. The new prices of Rs 10,634 per metric ton has been adjusted upwardly keeping in view the tag of global price of $155 per metric tons some two days back.

Shell Pakistan Limited had already climbed up the prices by second time in a week on Monday to Rs 10,580 per metric from Rs 10,216 per metric ton.

Sources in the oil sector said that another foreign oil marketing company, Caltex is likely to announce new rates of furnace oil in a day or two as it had suspended its fuel oil supplies on Tuesday.

SBP $ buying from open market opposed

A four-member IMF technical mission currently in the town spent much of their time on Thursday in convincing top bankers that the sooner the State Bank stops buying dollars the better it is for inter-bank market.

The mission headed by Advisor to IMF on monetary and foreign exchange affairs Abdessatar Ouanes met heads and treasurers of state-run Habib Bank and National Bank and senior executives of partly-privatized Muslim Commercial Bank.

Sources close to these meetings said the mission members held frank discussions with the bankers on key issues of foreign exchange market including the burning question of the State Bank buying of dollars from the open market.

They said the mission members were of the view that by buying dollars from the open market and financing oil imports in inter-bank market the SBP had followed a two-tier foreign exchange system that was not allowed under the IMF rules.

Saudi-Pak financing

The Board of Directors of Saudi Pak Industrial and Agricultural Investment Company Ltd has approved a total financing of Rs505 million to 11 companies.

The financing comprises Rs185m for five companies in manufacturing sector, Rs245m for one company in energy sector and Rs75m for five companies in services, communication and financial sector.

The approval was granted in a meeting of the Board of Directors, presided over by Dr Abdullah T.Al-Thenayan, who is also Director General of Arab Company for Livestock Development, Kingdom of Saudi Arabia.

National Foods

National Foods Ltd, the stock market listed company is believed to have hit the figure of Rs one billion in sales for the year that closed on June 30, 2000.

Bonus shares

Nishat (Chunian) Ltd would issue bonus shares (interim) at 100 per cent (one-for-one) on the basis of the financial results for the nine months ended June 30, 2000. The Board of Directors approved the interim pay-out on September 1, 2000.

Modest rise in T-bill yield

The State Bank on Wednesday raised the yield on six-monthly treasury bills by eight basis points to 7.46 per cent to borrow Rs200 million from the banks for the government. It also borrowed Rs67 million through one year T-bills at 8.10 per cent.

Senior bankers said the small increase of eight basis points in the six-monthly T-bills show that the central bank wants to raise the interest rates in a gradual manner.

They said the auction of T-bills had attracted Rs4.1 billion worth of bids of which bids worth Rs267 million were accepted and the rest scrapped. Bankers said the market closed at a dry note with call rates pegged at 10.95 per cent. A discounting of Rs4-5 billion also took place.

Revenue to go up by 36%

The Economic Coordination Committee of the cabinet was informed on Monday that an additional 36% revenue growth would be achieved during the current fiscal year in the wake of a satisfactory collection position in July and August.

Presiding over the meeting, Finance Minister Shaukat Aziz said that the government's entire economic strategy was based on getting the additional 36pc revenues. The meeting was told that the government would easily obtain an additional Rs100 billion in the current fiscal.

Indus Bank

Indus Bank Limited — the beleaguered private sector commercial bank informed its shareholders on Friday that it had lost Rs131.1m before tax during the year ended December 31, last. This compared with pretax profit of Rs6.6m earned the earlier year. Loss after tax for 1999 stood at Rsl40.6m, equivalent to loss per share at Rs4.69.

IMF experts assess forex market

A four-member technical mission of the IMF has started seeking first hand information on foreign exchange and monetary policies of Pakistan with particular focus on the issues related to their implementation.

Sources close to IMF said, the mission led by Advisor to the IMF on monetary and foreign exchange affairs Abdessatar Ouanes met senior officials of the State Bank, including advisors and executive directors on Wednesday. The mission will have another session with them on Thursday before meeting some local bankers. And on Friday they are expected to meet some foreign bankers.