June 24 - 30, 2002
DONORS PROMISE $2BN FOR NEXT THREE YEARS
Pakistan has been promised $2 billion annually for
the next three years jointly by the World Bank, the IMF and the Asian
Development Bank, says a senior government official.
"Our thinking is to get loans on high
concessions from the three donors and use them for retiring expensive
debts," said Mr Moeen Afzal, Secretary-General, Ministry of
Speaking at an economic forum arranged on Monday by
the Associated Press of Pakistan, he said for the current financial
year Pakistan had been offered roughly $2.5 billion by the donors
which included $1.6 billion International Development Assistance (IDA)
funding on a marginal interest rate.
Mr Afzal said that the World Bank which used to
offer $200 million annually on an average had now increased its
funding to $1 billion for Pakistan. Nevertheless, he said, all the
three donors expected Pakistan to achieve 6 to 7 per cent GDP growth
rate. "Donors believe that Pakistan has the potential to manage 6
to 7 per cent growth rate," Moeen Afzal said, adding that
Pakistan hopes to have a gradual increase in the growth rate.
He said had there been no persistent drought
conditions and Sept 11 incident, Pakistan would have achieved a better
The secretary-general stated fundamental structural
changes had been made in the tax system to collect adequate revenues
during 2002-2003. "I believe Rs460.6 billion revenue will be
collected during the next financial year," he added.
He said that the government would now be relying on
income tax and sales tax to collect considerable revenues. "They
will be the two major taxes of the future."
RS25.38BN EARMARKED FOR 16 DISTRICTS
The Sindh government has allocated Rs25.38 billion
revenue expenditures for all 16 districts of the province during the
financial year 2002-2003. According to the break-up salary and
non-salary expenses are estimated at Rs20.88 billion and Rs4.51
This revenue expenditure is earmarked for nine
general head of accounts, which include organs of state (excluding law
department and others), finance department, tax management — board
of revenue, planning, administration (works), education, health,
community and development department and agriculture and food
THREE MAJOR UNITS SELL-OFF TO FETCH $2BN
The government is expecting to earn $2 billion by
privatizing Karachi Electricity Supply Corporation (KESC), Pakistan
State Oil (PSO), Oil and Gas Development Company Limited (OGDCL) and
some other minor units by December 2002, says the privatization
minister. "And this $2 billion amount excludes the privatization
of Pakistan Telecommunication Company Limited (PTCL), whose evaluation
is still to be done," Privatization Minister Altaf M. Saleem
He said PTCL's earning would be additional, which
otherwise could have given better price, had it been sold six years
Briefing reporters on Thursday about the major
transactions, he said that OGDCL's 51 per cent and PSO's 45 per cent
shares would be offloaded within this year.
GHEE MAKERS RAISING PRICES
One of the leading ghee and cooking oil makers has
decided to increase the price of ghee and cooking oil by Rs9-10 per kg
in a couple of days, while others may follow suit following the levy
of 15 per cent general sales tax (GST) at factory level.
SBP, KSE FIGURES FALL POLES APART
In defiance of the trend of the first four months
of the current calendar year, foreign portfolio investment recorded
net outflow of Rs297 million or $5 million during the month of May.
But the numbers released by the stock exchange on Tuesday, would
neither gladden nor sadden some of the equity traders, who view them
"In the final analysis, these would fall poles
apart from the foreign stock investment figures compiled by the State
Bank of Pakistan," one analyst pointed out.
The argument has a grain of truth. The recently
released SBP report for the third quarter (Jan-March 2002) observed:
"Foreign investment in stock market registered an inflow of $55
million in Q3 (reflecting positive trends in stocks) as compared to an
outflow of $61 million during Q3 last year."
GOVT AIMS SINGLE DIGIT LENDING RATES
Finance Minister Shaukat Aziz said on Tuesday that
lowering the banks' lending rates to a single digit, narrowing down of
the spread and cutting down on the intermediation cost in the banks
are some of the objectives he is pursuing actively.
DOLLAR SHEDS 20 PAISA IN KERB
The US dollar on Monday fell by 20 paisa in the
kerb to hit a four-month low against the rupee amid falling local
demand from the general investors and steady inflow from the formal
According to Forex Association of Pakistan, the
dollar was quoted lower at Rs60 and Rs60.05 for buying and selling,
respectively, as compared to Rs60.20 and Rs60.25 at the weekend.
SSGC, SAUDI PAK LEASING TFCS
Sui Southern Gas Company Limited (SSGC) and Saudi
Pak Leasing Company Limited announced on Monday that their respective
Term Finance Certificates (TFCs) had stood oversubscribed.
SSGC said it had received subscription in the sum
of Rs350.54 million against the offer of Rs200 million to the general
The SSGC's 2nd tranche of the second TFC issue of
the aggregate amount of Rs1.05 billion offered to Institutional
investors, had earlier been fully subscribed.
GOVT TO ADVANCE RS79BN LOANS
The federal government has projected to make total
gross loans and advances, both for current and development, to the
tune of Rs79 billion during 2002-03.
This would be around 14 per cent higher than the
budget estimates of Rs69.4bn or 26 per cent more than revised
estimates of Rs62.55bn during 2001-02, budget documents suggest.