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 5. TRADE  6. GULF



Dec 03 - 09, 2001

PSMA for balance in demand, supply

The chairman Pakistan Sugar Mills Association (PSMA) Ashraf W Tabani said on Thursday that the government will have to rectify its past mistake by striking a balance between demand and supply of sugar to ensure viability of the industry.

"The unbridled imports of refined sugar last season has created a glut like situation in the domestic market resulting in crash of prices to an extent that it does not even cover up production cost of the industry," the PSMA chairman maintained.

Tabani said that new crushing season (2001-2002) has started with a huge carry-over stocks of 6,20,000 tons. As a result of this, he said, sugar prices came tumbling down from Rs24 to Rs19 per kg.

Consequently, he said sugar industry's operational viability has been totally eroded and there is no chance of price recovery during the entire current sugar season, starting from Oct 1, 2001 and will end on Sept 1, 2002.

Tea cultivation in NWFP picks up

Commercial production of tea will start from 2004 as tea cultivation in the NWFP picks up, following initial success of trial production undertaken by a multinational company.

A 159-acre of land has been earmarked in the NWFP for tea cultivation, while tea processing plant has already been set up.

Director Beverages, Lever Brothers, Naeem Khokar, told that his company produced two to three tons of tea this year.

Currently, tea production has been suspended as the planting season is restricted by weather conditions to a few short months. He said the process required extreme care and swift transfer of thousands of nursery plants to the fields and quick re-filling of the nursery for future plantation. Lever Brothers is currently producing nearly a million cuttings annually.

The total area under cultivation 159 acres is expected to rise to 360 acres by the end of this year and to 1,500 acres in the next five years, he said.

He said a mutually beneficial agreement was made with farmers, who sell their green leaves to the Lever Brothers at agreed prices. He said Mansehra, Chitral and Swat were potential tea growing area and in order to grow high quality tea. It is essential to have constant downpours and the temperature ranging between 37 degrees centigrade during the day and 12 degrees centigrade at night.

The tea processing plant in the small town of Dhodial on 2.5 acres of land was inaugurated recently. The plant, he said, was expected to process 50 kg of tea per hour or a ton of made tea a day. The aggregate research and development, including those for the next five years, will cost Lever Brothers an estimated Rs260 million. The total cost of the plant is Rs11 million, whereas Rs12 million has been spent on the building and infrastructure.

Rs40bn plan for social sector approved

A meeting, presided over by President Gen Pervez Musharraf on Monday approved Rs40 billion new spending programme for social sector.

The meeting reviewed the government's spending plan following new foreign aid commitments amounting to $1.2 billion, including $600m received cash from the United States as part of budgetary support.

After the meeting, Finance Minister Shaukat Aziz told reporters that the $600 million, equivalent to about Rs40 billion, had been disbursed to Pakistan. Giving the details, he said Rs25 billion would be used for narrowing the budgetary gap to ensure that public sector development programme and normal government spending were not effected.

Mr Aziz said Rs15 billion had been allocated for social sector projects, including human development, poverty reduction and job creation. The amount will be allocated to the provinces. He said the allocations for Khushal Pakistan Programme had been increased from Rs7 billion to Rs15 billion.

No delay in PRGF plan: Shaukat

Minister for Finance Shaukat Aziz on Monday said that there was no delay in IMF's poverty reduction and growth facility programme, and that it was on track.

Speaking at an Iftar-dinner hosted by the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Monday, Aziz said Pakistan had impressed upon the developed and donor countries that Pakistan was affected by the September 11 incident as its exports have been reduced and investment was less.

Australian firm wins contract

Australian construction and engineering group Clough Ltd has won the first phase of an onshore gas project in Pakistan worth 194 million dollars (US$97 million).

The contract is with oil and gas group, OMV, managing director of the Perth-based company, Brian Hewitt, announced on Monday.

The Sawan field, in the Thar Desert, is about 300 km northeast of Karachi.

17 projects put on hold

Pakistan has put on hold as many as 17 multi-billion-dollars infrastructure and energy projects being developed by the Chinese companies mainly because of regional political situation.

Foreign office sources confirmed that these projects would not come under discussion at least during the forthcoming visit of President Gen Pervez Musharraf to Beijing from Dec 20-24.

These sources said that a decision to this effect had been taken early this month at an inter-ministerial meeting presided over by foreign secretary Inamul Haq.

"The inter-ministerial meeting decided not to pursue these projects in the context of the President's forthcoming visit", another source quoting official documents said.

These also include some very important projects like $1.2 billion Pakistan-Iran Refinery and some crucial parts of Gwadar port project like Gwadar-Ratodero Road, Linking Gwadar Port with Railway Network.