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A

POLICY

April 29 - May 05, 2002

WORLD OIL COS INTERESTED IN PSO

Privatization Minister Altaf M. Saleem on Thursday said that world oil marketing companies like TOTAL and investors from Oman and Kuwait had expressed their interest in buying Pakistan State Oil (PSO).

"PSO seems to be very attractive entity for them," he said, while addressing the executive committee members of All Pakistan Textile Mills Association (Aptma).

Altaf Saleem said that the bidding for United Bank Limited would be held on May 25 and added that all the irritants in the way of bank's privatization regarding the refund by the Central Board of Revenue and Rs18 billion credit extended by the bank in Middle Eastern region had been resolved.

"Now the right of recovering credit from the Middle Eastern region lies with the government of Pakistan," he said. He said the process of privatization had received positive response from the domestic and foreign investors during the last two months. He said that number of parties interested in the purchase of Investment Corporation of Pakistan's 26 funds was more than 12.

"A similar response has been witnessed in case of National Investment Trust (NIT)," the minister said. He said that Canadian oil exploration firms were digging 16,000 wells annually against 25 by Pakistan's Oil and Gas Development Corporation (OGDC).

Altaf Saleem said the government was trying to rationalize the natural gas prices so that every body pays the real price of the consumed fuel. "Industry has been paying 160 per cent price of the gas due to the subsidy provided to the domestic consumers," he said.

Responding to a question, the minister said that sick units revival committee's decisions were binding for all the banks after their notification by the State Bank.

BADIN-1 BID REVISED UPWARD TO $143M

The highest bidder for Badin-I oil well has revised upward its bid from $131 million to $143 million, which is now being actively considered by the Privatization Commission (PC).

Pakistan Exploration & Production Inc, UK and Occidental Oil & Gas Pakistan LLC had jointly given the highest bid of $131 million for Badin-1 on April 15, which was not approved by the Cabinet Committee on Privatization (CCoP). The bidder was asked to raise its bid.

Sources in the PC on Saturday confirmed that they have received the revised bid of $143 million, which was roughly close to their reference price and that now the PC Board will shortly meet to recommend to the CCoP to approve the transaction.

The Privatization Commission on Monday last was offered a total of $176.3 million by the highest bidders for the divestment of Government of Pakistan (GoP)'s shareholding in nine oil & gas concessions. This also included $131 million for Badin-1.

BANKERS EYE $2BN REMITTANCES

Pakistan hopes to get $1.722 billion in the shape of workers remittances during this fiscal year up from $1 billion received in fiscal 2000-01. Sources close to the ministry of finance say the government initially expected to get $1.870 billion through workers remittances but lately it has scaled down the projection to $1.722 billion in consultation with the IMF. But senior officials of half a dozen banks handling workers remittances say the remittances may reach $2 billion by end of June.

The country has already got $1.543 billion workers remittances in the first nine months of the current fiscal year i.e. between July/March 2001/02. Workers remittances form major part of home remittances that also include Hajj remittances; remittances from Kuwait-Iraq war affectees and foreign exchange earnings through encashment of Foreign Exchange Bearer Certificates (FEBCs) and Foreign Exchange Currency Certificates (FEBs). In the first nine months of this fiscal year home remittances inclusive of all this stood at $1.626 billion.

NWFP SEEKS INCENTIVES

NWFP Minister for Industries and Labour Mohsin Aziz has asked the federal government to grant incentives to the province to enable it to have at least one car assembling plant.

He said concessions to one car plant in the NWFP would make a lot of difference as this would assist downstream as well as vender industries to grow, which in turn, ease the present unemployment situation in the province.

PROMOTION OF COMPETITION

A draft law meant to promote competition in Pakistan submitted by the Monopoly Control Authority (MCA) has been lying with the Ministry of Finance for more than a year to the detriment of Pakistani public, according to a reliable source.

The proposed law will replace the Monopolies & Restrictive Trade Practices Ordinance 1970 (MRTP) under which the Authority was created in the wake of country-wide agitation against, among other issues, the stranglehold of monopolies in the country.

PMDC TO BEGIN EXPLORATION IN NAS

Pakistan Mineral Development Corporation (PMDC) will take necessary measures for exploration of minerals and gemstones in Northern Areas in the light of previous studies conducted in the region.

ICP MUTUAL FUNDS

Twelve Expressions of Interest (EoIs) have been received by the Privatization Commission (PC) from different local and foreign parties for acquiring as one lot the management rights of ICP Mutual Funds from Investment Corporation of Pakistan.

PAKISTAN, US SET UP ECONOMIC FORUM

Pakistani and US officials discussed economic and financial issues at a meeting at the Treasury Department on Friday, and signed a Memorandum of Understanding formally setting up a joint economic forum.

The MoU was signed by Finance Minister Shaukat Aziz and US Treasury Secretary Paul O'Neill, and the two led their respective delegations in talks that followed the signing ceremony.