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

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INDUSTRY

June 10 - 16, 2002

COTTON OUTPUT UP TO 10.9M BALES

The ex-farm production of cotton during the current season rose to 10.9m bales, up by two per cent from the previous year, ensuring a larger exportable surplus after meeting the home demand, according to official sources.

The marketing and economic research committee of the Pakistan Central Cotton Committee (PCCC), which met on Tuesday under the chairmanship of Shafi Niaz, adviser to the chief executive on food and agriculture, lauded the efforts to produce contamination-free cotton in Rahimyar Khan and suggested to expand the programme to other areas also during the current season.

The committee was optimistic about the next crop and hoped it will be getting higher price owing to decline in global production and a modest increase in consumption.

However, it expressed concern over the larger import (1.3m bales) of cotton by the spinners, notably of those varieties, which are available in the country.

The committee urged the government to implement decision taken earlier to maintain the average per bale weight at 170 kg instead of the current 165 kg despite Pakistan Cotton Ginners Association's (PCGA) assurance to motivate ginners to adhere to the decided per bale weight.

ECONOMY SOUND, NOTES ECC

Finance Minister Shaukat Aziz said on Wednesday that a solid foundation of Pakistan's economy had been laid and now it was in position to meet any eventuality.

"Defence needs of the country will be fully catered for and Pakistan would continue to stay the course of reforms to further consolidate economic gains made in the last two and half years," he said while chairing the ECC meeting.

The minister expressed satisfaction over availability of stocks, stability in prices of consumers' items and encouraging economic indicators, including low inflation under three per cent and achievement of revised GDP growth target of over 3.3 per cent.

The ECC noted that gross foreign exchange reserves, which stand at $5.6 billion, are likely to cross $6 billion by the end of current financial year. The minister, however, said a lot more needed to be done and "we need to stay the course so as to leverage the targets desired as a result of reforms".

TAINT-FREE COTTON: ORD SOON

The government will shortly promulgate an ordinance to implement standardization system stipulating the production of high quality contamination-free cotton in the country.

Briefing the federal minister for Food and Agriculture and Livestock, Khair Muhammad Junejo during his visit to the institute, he was told that Pakistani cotton now has an edge over the Indian variety on the issue of contamination.

"Pakistan Cotton Standard Institute (PCSI) has already lowered the contamination level to 2.5 per cent from the previous 20 per cent per bale through its standardization system," the high-ups of the PCSI said.

DEFENCE BUDGET TO GO UP

The federal budget, which is being presented on June 15, will have an increased allocation for defence spending for the first time in three years.

"Our defence budget, in actual terms, has been static for the last three years but now we need to offer certain increase in it in the budget for 2002-2003, said Finance Minister Shaukat Aziz.

India had increased its defence budget by 28 per cent, 14 per cent and 8 per cent in 2000-2001, 2001-2002 and 2002-2003, respectively.

OLIVE OIL PRODUCTION

Pakistan Oilseeds Development Board (PODB) has launched a project to produce olive oil on a mass scale in suitable areas of Punjab, NWFP and Balochistan that will go a long way towards reducing edible oil import bill as well as raising the incomes of farmers.

WATER INFLOW INCREASES

For the first time in almost a year, provinces will get irrigation water as per their requirement from the middle of June as the flows in all the major rivers have risen significantly, with the level in Kabul river touching the low flood mark.

Indus River System Authority (Irsa) issued on Tuesday directives to the Water and Power Development Authority (Wapda), asking it to release water to all the four provinces according to their indent (demand).

PETROLEUM EXPLORATION LICENCE AWARDED

The government on Monday granted a petroleum exploration licence to the joint venture of Petroleum Exploration (Pvt) Limited (95%) and Government Holding (Pvt) Limited (5%) over Block No 2769-9 (Mirpur Mathelo), covering an area of 1030.66 square kilometres in Zone-III in Sukkur and Khairpur districts.

An official statement issued said that the area had a high potential of producing gaseous hydrocarbons from shallow reservoirs like Sui Main Limestone, Sui Upper Limestone and Habib Rahi Limestone of Eocene Age. Goru Sands of oretaceous age can also be considered as a secondary reservoir.

SINDH BUDGET TO BE TAX-FREE

The upcoming Sindh budget will be "tax free as well as investment friendly" aimed at further promoting industrialization and luring more foreign investment in the province.

This was stated by Sindh Minister for Finance and Planning, Dr Abdul Hafeez Shaikh at the inauguration of Printpak 2002 Exhibition, organized by the Pakistan Association of Printing and Graphic Arts and Industry (PAPGAI) at the Expo Centre on Friday night.

"We have adopted almost same philosophy as adopted earlier in finalizing the 2002-2003 budget by making it more attractive for industrialists and businessmen," he said.

BUDGET TO BE BUSINESS FRIENDLY

Federal Finance Minister, Shaukat Aziz on Saturday said that the budget would be business friendly, despite tension on the border. The minister said this at a meeting with the president , Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Iftikhar Ali Malik.