Dec 04 -
Pakistan Investment Bonds launched
The State Bank will conduct the first auction of
long-term Pakistan Investment Bonds on December 12. SBP said on
Wednesday the bonds carry a coupon rate of 12.5 per cent for three
years, 13 per cent for five years and 14 per cent for ten years.
SBP would announce the coupon rates for PIBs on
each auction. In other words these bonds do not carry a fixed rate of
return. Buyers of these bonds will rather be free to bid for them at
any price — higher or lower than the coupon rate — or simply at
par. Bankers say the auction for new debt bonds may be held regularly
every two months but in December there may be another auction.
PIBs will be issued in multiples of Rs100,000. The
profit earned on them will be liable to income tax. The government
will charge only 10 per cent withholding tax on the profit earned on
PIBs. And there will be no compulsory deduction of Zakat at source.
Both individuals as well as corporates — whether
in Pakistan or based abroad can purchase these bonds from seven
selected banks that will act as State Bank primary dealers.
These banks are: (i) Habib Bank (ii) National Bank
(iii) Union Bank (iv) Citibank (v) ABN Amro Bank (vi) American Express
Bank and (vii) Standard Chartered Bank. Profits on these bonds will be
paid on six-monthly basis. SBP said on Wednesday it would receive
tenders for these bonds by its primary dealers on December 12 and open
them on the same day.
The State Bank has set a target of Rs 4 billion for
the first auction of the bonds. The bonds have been launched to bring
back into financial system the institutional funds whose investment in
national saving schemes was banned in March and to set benchmark rates
for long-term bonds.
Deduction from F-16 money shocks CE
Chief Executive Gen Pervez Musharraf summoned the
finance minister and top officials of the finance ministry, foreign
affairs, agriculture and economic affairs ministries for an emergency
meeting on Friday to discuss the F-16 vs wheat fiasco, as disclosed on
The fact that Washington had deducted $60 million
from the F-16 account was not disclosed to the chief executive in
September and Gen Musharraf was reported to be furious on Thursday
when he learnt about such a major development through the press.
Top finance ministry sources told on Thursday that
Finance Minister Shaukat Aziz and Foreign Minister Abdul Sattar had
been directed to bring all the relevant record of the F-16 settlement
with the US government and brief the CE comprehensively.
Finance Secretary-General Moin Afzal, Agriculture
Secretary Dr Zafar Altaf and the secretary of the economic affairs
division, Nawaid Ahsan, have also been asked to attend the meeting.
Ordinance on POL, gas prices likely
The government will continue determining the
petroleum and gas prices without hearing the views of consumers even
after the establishment of the Petroleum Regulatory Authority (PRA).
The PRA, the draft ordinance for which is being
finalized for likely promulgation next month, will empower the
regulators to make changes in the petrol and gas tariff without even
consulting the consumers.
Petroleum Ministry spokesman Jehangir Bashar told
that the government would continue determining the prices till the
time POL products were deregulated. He said the government was in the
process of deregulation as Liquid Petroleum Gas, Furnace Oil, and
Compressed Natural Gas had already been deregulated, and diesel would
be deregulated soon.
The government, he said, was aiming to deregulate
the entire petroleum sector, but till the time the process was
completed the government would continue exercising its privilege to
determine the prices.
Romanian Ambassador to Pakistan Emil Ghitulescu
Thursday said, an important Romanian economic delegation will visit
Pakistan at the beginning of the next year, to give fresh impetus to
bilateral relations in various fields of mutual interest.
"There is great untapped potential for
increasing the volume of bilateral trade between Romania and Pakistan
and much room for strengthening the economic cooperation," he
said while delivering a talk on "Universal values of Romanian
culture and civilization: Pakistan-Romania relations," here.
The talk was organized by the Institute of
US team meets Dawood
A five-member US business delegation headed by
Douglar Coe, special envoy of Congressman Joseph Pitts called on
federal minister for commerce, industries and production Abdul Razak
Dawood on Wednesday, an official press release said.
Welcoming the delegation, the minister said
Pakistan had a liberal and clear policy on foreign investment. Being a
centre of export all around the region, it offers lot of potential and
skills for investment in agro-based industry, garments, information
technology, auto part, energy and leather sectors.
Two more inducted in Cabinet
The strength of the federal cabinet rose to 17 with
the induction of Shahida Jameel and Altaf M. Saleem, who took oath of
their offices on Tuesday.
Ms Jameel, who was the minister for law in the
Sindh cabinet, has been appointed federal minister for law and human
Mr Saleem, chairman of the privatization
commission, has been given the status of federal minister.
World Bank assures 'special funding' to CBR
World Bank has assured to offer "special
funding" for undertaking tax reforms in the Central Board of
Revenues (CBR). Official sources said on Monday that the Vice
President of World Bank Ms Mieko Nishimizu met Chief Executive Gen
Pervez Musharraf on Saturday and assured to extend special funds for
undertaking reforms in the CBR.
Although no specific additional funds were
announced by the World Bank vice president, she said that tax reforms
was an important area which needed special attention of the donor
agencies and that it will oblige the government.