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May 14 - 20, 2001

Pakistan-assembled cars demand up

Auto assemblers are trying to make their presence felt in the global export market, but some domestic problems like lower volumes coupled with India's competitive prices, are creating problems in materializing their efforts.

Pak Suzuki Motor Company (PSMCL) exported 98 units of Ravi pick-up in July-May 2000-01 to Bangladesh as compared to 72 units in the same period previous fiscal, contributing Rs20 million to the government's purse. A senior PSMCL official told that the export of pick-up is likely to touch 110 units in July-June 2000-2001.

The company made a modest beginning with export of 24 units in 1997-98 followed by 57 units in 1998-99 and 90 units in 1999-00 to Nepal and Bangladesh.

However, in car segment the company is yet to achieve any major breakthrough as India virtually rules the region by offering competitive prices.

For instance, India produces 400,000-425,000 Maruti car every year and it has surplus units to dump it in the region at cheaper prices. Pak Suzuki rolls out a total 22,000 units of various versions. "We do not have enough volumes to enter the global car market," the official said.

The company has asked the government to give some incentives like 20 per cent rebate and duty draw back facility so that its products could compete with India.

There exists good market potential in Bangladesh, Nepal and Central Asian states but a lot depends on our competitiveness, the official said.

The assembler of Toyota Corolla also sent its models to test the markets of Sri Lanka and Bangladesh, but could not get a positive feed back due to cost competitiveness with other countries, an official said.

A senior executive in Atlas Honda, makers of Civic and City, said our products enjoy demand in Bangladesh, Nepal, South Africa and Middle East, but our price is not that competitive.

OGDC seeks global expertise

The Oil and Gas Development Company (OGDC) has mobilized all available local resources and also contacted specialized international expert companies for controlling the flow of gas and water from the Uch Deep Well.

According to a press release, a foreign specialized company hired for the purpose of carrying out initial detailed survey at the well site has completed its task and submitted detailed technical proposals for controlling the well.

These proposals have been duly considered by the technical and finance sub committee of the board of directors of OGDCL, which met twice on April 19 and 30 for the purpose and decisions were taken.

IMF asked to lower deficit target

Pakistan has approached the IMF to lower the target for budget deficit to create fiscal space required to step up development spending, spur economic growth and reduce unemployment.

Sources said fiscal deficit had emerged as the core issue on which Pakistan and the IMF hold different views. The IMF had not acceded to Pakistan's request. The government would ensure that the deficit was on target for June 2001 at 5.2 per cent of the GDP, they added.

Islamabad has, however, not given up and would continue with its efforts to convince the IMF that given the low level of investment activity, it is left with no option but to step up government spending to provide business opportunity and revive the economy.

Wheat procurement target

Wheat prices have crashed due to "go slow" policy of the government and those behind the problem are still influencing the proceedings. This was alleged by Farmers Associate Pakistan chairman Shah Mehmood Qureshi at a press conference along with the representatives of the Lahore Chamber of Commerce and Industry and the Pakistan Flour Mills Association on Tuesday.

"The farmers have been caught between the devil and the deep blue sea. On one hand the cost of agriculture inputs has skyrocketed due to high diesel and electricity prices and levy of GST and on the other hand the prices of their produce are nose-diving".

China to supply locomotives

China will help the Pakistan Railways (PR) improve its train service by replenishing its aging rolling stock in a five-year phased programme. For this, China will also extend a soft loan of $150 million to the PR, payable in about 15 years. Besides, transfer of technology in locomotive manufacturing is an essential feature of the assistance programme.

A senior railway official told on Wednesday that China would supply 69 locomotives and 175 passenger coaches during the five-year plan period. In the first year, 15 locomotives would be made available, he added.

White oil pipeline project

The Chinese firm, China Petroleum, which was awarded a contract for the white oil pipeline project (WOPP) by PARCO, has agreed to withdraw its condition sovereign guarantee.

Official sources told on Tuesday that an agreement would be signed during the forthcoming visit of Chinese prime minister, on the eve of 50th anniversary of Pakistan China friendship.

The controversy with regard to sovereign guarantee for WOPP had begun when Exim bank of China sought sovereign guarantee for the project, the sources said. Pakistan's petroleum ministry had approached the Chinese government to ask its company not to demand sovereign guarantee for laying a white oil pipeline from Karachi to Mehmood Kot, near Multan.

Support price policy to stay

The government on Monday decided to continue with the existing support price policy of four major crops wheat, rice, cotton and sugarcane, to safeguard the interests of grower.

The decision was taken during a meeting with the Chief Executive, General Pervez Musharraf in chair. The meeting was held to review the support price policy for agricultural crops, Minister for Food and Agriculture, Khair Muhammad Junejo said in an interview.