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 1. INTERNATIONAL   2. INDUSTRY
 3. FINANCE  4. POLICY
 5. TRADE  6. GULF

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FINANCE


Oct 22 - 28, 2001

Britain writing off $84m loans

The visiting British Secretary of International Development Ms Clare Short announced on Thursday that the international community has decided to extend maximum economic support to Pakistan including relief in debt repayment.

Speaking at a joint news conference with Finance Minister Shaukat Aziz she announced that $84 million loans were being written off by British government. She said immediately her department will write of $34 million loans while $51 million loans will be written off by the Commonwealth Development Corporation shortly.

Mr Shaukat Aziz during the press conference disclosed that a comprehensive economic package was being finalised by Pakistan in line with the wishes of the international community.

In reply to a question, he said that Pakistan has a $12 billion bilateral debt and $15.5 billion multilateral debt. "And our package initially focuses on getting relief on account of $12 billion bilateral debt."

He disclosed that Pakistan has been assured maximum support by international donors and bilateral creditors in this regard and termed Ms Short's visit as very significant to have lined up economic support for Pakistan both for economic recovery as well as for Afghan refugees.

The British secretary of state for international development also announced a 15 million pounds package to support the government of Pakistan in its continuing reforms and in its efforts to alleviate the humanitarian crisis which has been made worse by the influx of Afghan refugees into the country.

Ms Short also declared that her department would increase its bilateral programme to Pakistan to 45 million pounds annually for the next two years. "These financial pledges come on top of the additional 11 million pounds the UK has provided since September 11 to ensure that weaker section of the society in Pakistan do not suffer because of the influx of Afghan refugees, and further 40 million pounds committed to alleviate the humanitarian crisis in the region," she said.

Oil prices cut by 5.5-11.5pc

The Oil Companies Advisory Committee on Monday cut the prices of petroleum products by 5.51 per cent to 11.48pc for the Oct 16-31 fortnight. In another development, Pakistan State Oil slashed the prices of light sulphur and high sulphur furnace oil by 4.53pc to 15.36pc.

The price of petrol (MS 87-RON) was slashed by 6.01pc to Rs30.51 per litre from Rs32.46, while a decline of 9.69pc was announced in the price of high speed diesel, now quoted at Rs17.33 per litre against Rs19.19. High Octane Blending Component would now be available at Rs34.48 per litre as compared to Rs36.49, while the new price of kerosene oil was fixed at Rs16.27 per litre from Rs18.38.

The price of light diesel oil was reduced to Rs14.48 per litre from Rs16.23. The new price of JP-4 is Rs14.72 per litre, down from Rs16.62. OCAC chairman

US notifies $50m grant for Pakistan

The United States has formally notified the grant of another $50 million for Pakistan in addition to a grant of a similar amount authorized by President Bush late last month just before the end of the financial year.

The second $50 million was approved by Mr Bush on Tuesday after the beginning of the current financial year on October 1, but before Congress finally approved legislation granting waiver authority to the president in relation to sanctions on Pakistan.

The grant, officials stress, is not connected with this legislation, which in turn will permit the finalization of an overall economic and military aid package for Pakistan.

Forex reserves rise

The foreign exchange reserves held by the State Bank rose from $1.750 billion on September 6 to about $1.764 billion on October 13 showing a buildup of $14 million within a week.

Hubco lenders approve dividend

The Hub Power Company Limited (Hubco) announced on Wednesday that the lenders had approved the 'company's request for payment of an interim dividend'.

The much-awaited lenders' approval was greeted by the stock market with 85 paisa increase in the stock price, which closed at Rs18.05 with a huge turnover of 90.7 million shares during the day.

OGDCL post-tax profit

The after-tax profit of the Oil and Gas Development Company Limited (OGDCL) for the year 2001 stood at Rs20.644 billion against Rs10.555 billion showing an increase of around 50 per cent.

According to profit and loss account approved by the OGDCL board of directors last week, before-tax profit of the company stood at Rs25.6 billion against Rs12.9 billion, showing an increase of over 49 per cent.

SBP makes second cut in T-bills yield

The State Bank on Wednesday cut maximum yield on six-month and one-year treasury bills for the second time during this month. This reinforces an earlier SBP signal that it wants to keep banks reasonably liquid in the months to come.

The SBP slashed the cut-off yield by 11 basis points to 10.28 per cent for six months and by 5 basis points to 10.74 per cent for one year. The central bank said it sold Rs3.5 billion T-bills at the reduced cut-offs and sucked in Rs3.2 billion from the banking system.

Investment in NSS rises

Investment in national saving schemes (NSS) shot up to Rs6.8 billion in July-August 2001 from Rs3.6 billion in July-August 2000 as the government started paying a market- based floating rate of return on them.

In the meanwhile average bank deposit rates also declined, leading the savers to shift part of their savings from bank deposits into NSS.

First Al-Noor Modaraba

On Monday, First Al-Noor Modaraba announced financial figures for the year ended June 30, 2001, posting 35.6 per cent growth in pre-tax profit to Rs49.5 million, from Rs36.5 million the previous year.

Lease financing

Pakistan Industrial Credit and Investment Corporation (PICIC) will extend Rs1.5 billion under lease financing to industrial sector by the end of June 2002.