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July 16 - 22, 2001

Shipping policy announced

Pakistan's Merchant Marine Policy-2001, providing a package full of incentives to attract carriers flying Pakistani flags was announced on Tuesday by Federal Communications Minister, Lt-Gen (Retd) Javed Ashraf Kazi, at a press conference on Tuesday.

Highlighting the salient features of the policy, the minister told newsmen that this policy document is viewed as a dynamic effort which shall need continuous input from all stakeholders to ensure effective implementation, and for making adjustments if so required.

The government, he said, shall constitute a Standing Committee under the Secretary, Ministry of Communications for this purpose.

The committee shall comprise members from the relevant ministries/agencies and stakeholders from the private sector and meet at least once every year from the date of promulgation of this policy.

Lt-Gen Javed Ashraf said that Pakistan's annual trade is 39 million tons, while the share of the national carrier averages 2 million tons, or a mere 5 per cent. Resultantly, the annual freight bill is over $1.5 billion which, the minister said, is a colossal drain on the limited/depleting foreign exchange resources of the country.

This policy, he said, provides a predictable environment, which through deregulation, simplified procedures, incentives and assurances will provide an environment that is investor-friendly.

By attracting foreigners, overseas Pakistanis and local investors, dependence on foreign carriers will be considerably reduced hence substantial savings of foreign exchange, he said.

Pipeline to be discussed, hopes Iran

New Delhi has agreed to pursue the proposed 2670-km overland gas pipeline from Iran through Pakistan to India, diplomatic sources told on Tuesday.

This is precisely what the visiting high-level Iranian delegation has conveyed to Pakistan with a request to take it up for discussion during the forthcoming Pakistan-India summit meeting for further progress.

"From today's meetings, I think the issue will definitely come on the agenda, though as a secondary issue after Kashmir", said an official source who attended a series of meetings on this subject on Tuesday.

"The whole world has its eyes on the summit and the overland pipeline and we want the project implemented", Iranian deputy foreign minister and Iranian President's special envoy Syed Mohammad Hosein Adeli was quoted as telling the petroleum minister Usman Aminuddin in an-hour long meeting.

NDFC insolvent, says WB report

The World Bank has termed National Development Finance Corporation (NDFC) "capturer" of the multi-million-dollar Long Term Credit Fund (LTCF) and a future risk to administer fund flows in view of its "insolvent state".

In a report submitted to the federal government and NDFC, the Bank said, "NDFC's ability to continue to administer the Fund is tied to its own future, which is in question given its insolvent state. It is unclear that the NDFC would be in a position to remit funds held on deposit on behalf of LTCF without liquidity assistance from the State Bank of Pakistan."

Presenting a depressed analysis of the NDFC's role as a fund administrator, the bank has recommended the government to replace the NDFC as the administrator, given its inability to effectively manage the Fund and to put in place an interim arrangement to monitor the current portfolio of assets.

Universal Insurance Company

On Wednesday, Universal Insurance Company Limited announced that the board had decided to increase the paid-up capital of the company by the issue of one million right shares at par, in the ratio of one-for-five (20 per cent).

In spite of the gloomy stock market conditions that saw the KSE- 100 index hit a seven-month low at 1298 points on Tuesday, many insurance companies are opting to ask shareholders for cash in right issues. All are vying to meet the new requirement under the Insurance Ordinance 2000, that stipulates that Insurance Companies must raise their minimum paid-up capital to Rs50 million by December 31, 2002 and Rs80 million by the end of December 2004.

Rs1.3bn ADBP loans remain unutilized

Out of total Rs3 billion Agriculture Development Bank of Pakistan loans extended to the NWFP farmers during the financial year 2000-01, over Rs1.3 billion remained unutilized, sources told on Tuesday.

According to ADBP sources, the bank had specified a sum of Rs3 billion to extend loans to the NWFP farmers. However, the amount could not be utilized properly due to 14 per cent interest on ADBP loans and the provincial government's concerned agencies failure to prepare maximum number of pass books to enable farmers to avail loans, said sources.

Pak Panther Spinning seeks delisting

Pak Panther Spinning Mills Limited said it intends to purchase all shares available in the market at par i.e Rs10. The company has sought de-listing from the stock market.

Giving the reasons for opting out of the market, the company said that due to the persistent recession, heavy burden of financial charges and inflationary increase in overhead costs, the company was faced with continuous losses since its listing at the stock exchanges.

WAPDA okays Genco-1 sell-off

WAPDA authorities on Monday identified Genco-1, consisting of Lakhra, Jamshoro and Kotri power plants, and the Faisalabad distribution company (Fesco), for privatization.

This was disclosed by Manzoor A. Sheikh, Member Finance WAPDA, on Monday. A letter has already been sent to the Privatization Commission.

About authorizing the Sindh government to privatize Lakhra power plant, he said that the provincial government had requested the centre for such permission on the ground that Lakhra Coal Mine, provincial property, and the power plant, have to be privatized. It may be easy if both are privatized simultaneously.