17 - 30, 2001
Rs51.8bn budget approved for PIA
The Pakistan International Airlines' Board of Directors on
Wednesday approved Rs51.811 billion budget for the national flag carrier for the
Managing Director PIA Ahmed Saeed while presenting the budget
before the meeting projected a profit of Rs2.427bn during the next year.
According to the provisional figures presented before the Board the airline
sustained Rs2.085bn losses during the year ending December 2001.
The budget projections for the year 2002, he said, reaffirms
managements' resolve to put the airline on the path of sustainable profitability
The profit target of Rs2.427bn would be realized through
revenue enhancement with a "restricted" increase in expenditure. The
next year's target, the MD said, will be achieved through product improvement,
better service, fleet renewal, manpower rationalization and image restoration.
The profit expectation is after absorption of interest cost
of Rs2.3bn on Term Finance Certificates (TFCs) and short term loans.
The revenue generation under the budget projections is
expected to increase by Rs4.703bn from last year's Rs47.108bn to Rs51.811bn,
whereas the expenditure would go up by Rs191 million from Rs49.193bn last year
to Rs49.384bn. The projected revenue increase over the last year is 10 per cent,
while expenditure would rise by 0.4 per cent.
The seat factor has been projected to increase to 72.1 per
cent against last year's 67.3 per cent.
According to the break up of the revenue sources, the PIA
expects to earn Rs41.403bn from scheduled flights; Rs2.260bn from Hajj
operations; Rs190 million through mail handling; Rs5.258bn as freight charges;
Rs1.198bn from excess baggage and non-transport services to fetch Rs1.502bn.
ADB approves $350m agriculture loan
The Asian Development Bank (ADB) has approved US$350 million
soft loan for the development of five-year agriculture sector programme in
The first tranche of $125 million will be disbursed after
taking compliance measures.
According to an announcement made by the local ADB office
here on Thursday, the primary objective of the "Agriculture Sector
Programme Loan" will be to improve agriculture productivity and
It included special reform measures to promote efficient
markets for major commodities including wheat, cotton, rice sugar, fertilizer,
and seed. The purpose is also to strengthen support services in small farmer
extension and training, research and regulation, to improve quality.
PRGF sets tax-GDP ratio at 14.3pc for 3 years
The government has to raise an additional revenue of Rs140
billion during the next three years to increase the current tax-GDP ratio from
11 per cent to 14.3 per cent as agreed with the International Monetary Fund
under the Poverty Reduction and Growth Facility (PRGF).
The target would be achieved by plugging loopholes in the tax
administration by restructuring and imposing new taxes, a senior official told.
Under the PRGF agreement, the government is bound to get the
GDP ratio enhanced to 14.3 per cent by the end of fiscal 2003-04.
To meet the IMF conditionality, the tax officials have been
asked by the government to work out those taxable items on which new taxes could
be levied or on whom the ratio of taxes were low. Similarly, more people would
be brought into the tax net to meet the target.
Gas tariff for cement industry to go up 14.5pc
Gas tariff for cement industry would be increased by around
14.5 per cent in two phases — 4.5 per cent this month and 10 per cent by July
"This is in line with the government decision to bring
natural gas price at par with furnace oil for cement plants so that all plants
whether running on fuel oil or natural gas could be provided a level playing
field," a senior petroleum ministry official told. However, a minimum of 10
per cent differential between gas price and furnace oil price would always be
maintained, the official said. This meant that gas price would always remain 10
per cent lower than furnace oil, the official explained.
SIZs incentive package extended till Dec 2002
The Central Board of Revenue has extended an incentive
package offered to investors in the Special Industrial Zones (SIZs) till
December 31, 2002.
The package included exemption from 25 per cent customs duty
leviable on import of raw materials for manufacturing of goods, duty free
imports of machinery, which were not locally produced by such industries and
commercial operation was commenced up to December 31, 2002, an official source
The package was, however, available to investors till June
30, 1999 in SIZ, which after due date lapsed.
The decision was taken to provide maximum incentives to those
investors, who had suffered due to discontinuity in the SIZ facilities after
June 30, 1999, the source added.
Germany gives $22m to fight poverty
Germany has given Pakistan 50 million marks ($22.8 million)
in additional aid to fight poverty, improve education and health care and
support Afghan refugees, the overseas development ministry said Tuesday.
Berlin said the aid package was intended in part to recognize
Pakistan's anti-terrorism efforts and in particular its acceptance of thousands
of Afghan refugees since the US-led war began.