. .

testh2(2).gif (378 bytes)













































































Aug 06 - 12 , 2001

$596m SBA to end in Sept

The IMF standby agreement or 10-month standby credit programme currently in operation in Pakistan would end in September, and any extension in SBA or its conversion into a long term programme seems out of question.

Sources close to ministry of finance said that the IMF review mission due in Islamabad in mid-August would evaluate Pakistan's economic performance in fiscal 2000-01 besides holding talks on poverty reduction and growth facility.

They said there are no indications about Pakistan seeking an extension in SBA or its conversion into PRGF adding the IMF is less likely to weigh such prospects. Since Pakistan has met most of key performance criteria set for the last quarter of fiscal 2000-01 the mission should not have difficulty in recommending the release of fourth tranche out of the $596 million standby credit. Pakistan has so far received three tranches worth $457 million and the release of the fourth one is linked to its meeting the performance criteria set for April-June 2001. The previous three tranches were also released only after Pakistan had met quarterly performance criteria.

The sources said the five-member IMF mission would split into two groups: one would review the economic performance of Pakistan in line with the performance criteria attached to SBA, and the other would hold negotiations on PRGF. But they could not say how early the fourth tranche would come in.

It will depend on how quickly the mission wraps up its report and how early the IMF board of directors takes up the issue. The third tranche was released quite late in mid-July although the IMF mission had visited Pakistan as early as in May to assess if it has met the performance criteria set for January-March 2001.

The sources said since the 10-month SBA approved on November 30, 2000 is going to expire in September there is naturally no performance criteria for Pakistan in July-September quarter. But they made it clear that indicative targets already set for this quarter would remain in place. If Pakistan meets the same it would help Islamabad improve its image and pave the way for PRGF.

Remittances cross $1bn mark

Home remittances or the amount of foreign exchange sent back home by overseas Pakistanis totalled $1.021 billion in fiscal (July/June) 2000-01 crossing the one billion dollars mark after two years.

In 1998-99 home remittances had fallen to $875 million showing the loss of confidence of overseas Pakistanis in the country's banking system. Pakistan had frozen $11 billion worth of foreign currency deposits most of which belonged to overseas Pakistanis after going nuclear on May 28, 1998 to avoid default on payments.

In 1999-00 the situation improved and home remittances rose to $913 million but still below one billion dollars mark. Before going nuclear Pakistan used to get more than a billion dollars in home remittances on an average.

Banks, NBFIs to get 2.75pc return in Aug

The State Bank said on Tuesday it would pay banks and non-bank financial institutions 2.75% annual return in August on the 20% special cash reserves on their foreign currency deposits. The return fixed for July was 2.86%.

The State Bank fixes this monthly return on the basis of the one-month LIBOR (London Inter-Bank Offered Rate) at the close of the last working day of the previous month. On April 2 this year, the SBP freed up foreign currency deposits of banks placed with it, allowing them to use the same in local or international markets. But it also asked them to keep 25% of their total foreign currency deposits as cash reserves in foreign currency. The SBP promised to pay banks and NBFIs a monthly return on 20% special cash reserves, making it clear that the remaining 5% being mandatory cash reserves would earn no return.

Forex reserves rise to $3.25bn

Pakistan's liquid foreign exchange reserves rose to $3.25 billion on July 28 from $3.23 billion on July 21. The SBP said on Thursday the total reserves included $1.68 billion held by it and $1.57 billion by all other banks.

20% cut in LPG prices ordered

The government has asked producers and marketing companies of Liquefied Petroleum Gas (LPG) to reduce prices by at least 20 per cent immediately, official sources told on Wednesday.

An advice in this respect was given by Secretary, Petroleum and Natural Resources, M. Abdullah Yousaf at a meeting of the representatives of LPG producers/oil refineries and marketing companies with an objective to overcome the surplus LPG production. If the advice is followed, the LPG prices would come down from existing Rs230/240 per cylinder to Rs180/190 per cylinder, these sources said.

11 EoIs for NIT shares received

Privatization Commission on Tuesday received eleven expressions of interest from international and Pakistani parties for acquiring 58 per cent government shares in National Investment Trust Limited (NITL) the Asset Management Company of National Investment (Unit) trust.

Rupee gains 10 paisa in kerb

The rupee gained 10 paisa more to a dollar in the open currency market on Tuesday. It closed at 66.65/65.85 per US dollar for spot buying and selling up from 66.80/66.95 per dollar on Monday.


Gillette: Gillette Pakistan Limited announced financial results for the first half of the year to end-June 2001, posting pre-tax profit of Rs56.8 million.

JSIB: Jahangir Siddiqui Investment Bank (JSIB) posted 125 per cent growth in profit after tax to Rs45 million for the year ended June 30, 2001, from a year ago taxed profit at Rs20 million.

AHSL: Arif Habib Securities Limited (AHSL) the stock brokerage firm posted 42 per cent drop in profit after tax to Rs133 million for the year ended June 30, 2001, from a year ago taxed profit at Rs228 million.

Knoll Pharmaceuticals: Profit after tax at Knoll Pharmaceuticals Limited for the half year ended June 30, 2001 improved 8 per cent to Rs40m, from Rs37 million for the corresponding period of last year.