Mar 25 - 31, 2002
Domestic growth shows no sign of improvement: SBP
The State Bank of Pakistan says the outlook on domestic
growth has not shown perceptible signs of improvement in the first half of this
fiscal year and warns that exports may also fall further in the second half.
"Despite increased foreign assistance and favourable
external developments the outlook on domestic growth, investment, budgetary
revenues and employment still does not show perceptible signs of
improvement," says the second quarter report of the SBP released on
Wednesday. "This reinforces our belief that the favourable external sector
should not lull us in a false sense of complacency."
In the external sector the balance of payments registered a
dramatic improvement during the first half of this fiscal despite a marginal
decline in exports.
The current account showed a surplus of $1.27 billion in
July- December 2001 against a deficit of $262 million recorded in July- December
2000. The overall balance of payments showed a surplus of $751 million —
"a feat that has rarely been achieved before."
Foreign exchange reserves also shot up to a historic high of
$4.8bn at end-December from $3.2bn at end-June 2001.
"The developments in the external sector have also
improved the outlook for foreign direct and portfolio investment which has been
reflected in the upgrading of Pakistan's credit rating by Moody's," says
the report. Net foreign investment has already increased by $148m during the
first half of this fiscal year up from $74.7m a year ago. And home remittances
or the money sent back home by overseas Pakistanis shot up to $983 million in
July-December 2001 from $609m in July-December 2000.
The report says the improvement in creditworthiness following
Paris Club agreement, ongoing implementation of PRGF, and reserve accumulation
should provide sufficient signals for expected turnaround in the real sector of
Spinning mill revived
The Revival Committee for Sick Units on Wednesday decided to
revive a spinning mill — Golden Textiles — at a meeting held. The committee
met at the regional headquarters of National Bank of Pakistan with its chairman
Tariq Hamid in the chair.
With the revival of textile unit the number of total sick
units whose loans have been restructured by the banks on the recommendation of
the committee rose to 125. The committee says the revival of these units has
saved over 38,000 jobs. The committee has so far considered the revival pleas of
some 273 units since its inception about two years ago.
Out of revival pleas of six units taken up at the meeting,
the cases of another three have been referred to a sub-committee for further
deliberation and consideration. Sources were hopeful that these units would also
be revived through restructuring of their loans.
Sindh to get more water
The Chief Executive Secretariat on Monday decided to review
the controversial Greater Thal Canal Project, increase water supply to Sindh
till March 31 to facilitate sowing of Kharif crops , and approach the Supreme
Court over the interpretation of Clause 14-B of the Water Accord, 1991.
The decisions were taken at a meeting held by the Principal
Secretary to the Chief Executive, Tariq Aziz, with irrigation secretaries of
Punjab and Sindh, Tariq Majeed and Mir Mohammad Parhiyar, respectively, a highly
placed source told.
As a consequence of the decisions, the source said, the
construction of Thal Flood Canal, which had been started by Wapda even before
Ecnec could have accorded approval to it, would be stopped.
EC to give Rs1.2bn for livestock plan
The European Commission (EC) will provide Rs1.2 billion for
livestock project in Pakistan, under a pact signed between Islamabad and the
commission on Saturday.
The EC has agreed to fund the plan by approving a grant
equivalent to 22.900 million euros. The duration of the project is six years,
from the date of arrival of the technical assistance in Pakistan.
The project aims at developing potential of the livestock
sector, improving existing provision of livestock services, eradicating diseases
— like rinderpest, and foot-and-mouth disease — and initiating efficient and
quality production of vaccines.
Local car assemblers gear up production
Local assemblers have finally geared up their production to
meet the rising demand of cars from the buyers, but the market may witness
shortage for few more months because of lengthy period of delivery.
The Ministry of Industries and Production also asked the
assemblers few days back to roll out maximum number of cars in order to overcome
the rising demand. Manufacturers were asked to check with their dealers for
charging hectic premium on new models.
Bosicor oil refinery to start output
New $50 million Bosicor oil refinery, with refining capacity
of 30,000 barrels per day (bpd), will start production by October, a company
spokesman said on Saturday.
The spokesman said the new refinery, being set up near the
southern port city of Karachi under Pakistani management, had drawn on project
financing of $50 million from local and foreign banks, with 60 per cent equity
and 40 per cent debt financing.
"We expect to start up the plant by October this
year...it will have a production capacity of slightly over 30,000 barrels per
day," he told Reuters. The project is owned by private Pakistani company
Bosicor Pakistan Ltd.
To cope with the growing demand of automobiles in the
country, the Ministry of Industries and Production has asked the manufacturers
to gear up production to ensure sufficient supplies availability with minimum
These views were expressed by Commerce Minister Abdul Razak
Dawood in a meeting with the automobile manufacturers on Wednesday.