Oct 07 - 13 , 2002










The Bush Administration has assured Pakistan of increased US investment and additional budgetary support for health, education and internal security. "We have extensively discussed the question of increasing American investment in Pakistan and more


market access specially for our textile products and we have received a very good response", said minister for finance Shaukat Aziz.

Speaking at a news conference after returning from a four-day visit to the United States, he said on Thursday that he has held fruitful discussions with US Secretary of Treasury Paul O' Neil and Deputy Secretary of State Mr Larson for increasing political and economic cooperation between the two countries.

He said he has held important discussions with the World Bank, IMF and IFC officials in Washington. At the same time, he said he had met the authorities of the EXIM Bank, Overseas Private Insurance Corporation (OPIC), beside holding separate meetings with various finance ministers including that of France, Britain, Saudi Arabia and Kuwait.

Giving the details, he said that during his meetings in Washington matters pertaining to continuity of reforms, consistency in policies and continuation of the present team of President Pervez Musharraf beyond October this year were discussed.

"I told them that as far as the present team is concerned, this will be decided by the future government. However, I assured them that the government would make sure that reform process continues and is not undone by the future government", Mr Aziz said.

He said that the US secretary of treasury assured him that his country would write off $1 billion out of $3.2 billion debt owed by Pakistan. The issue he said, has been sent to Congress for final approval.


Pakistan has been assured to continue receiving annually $800m to $1 billion oil facility from Saudi Arabia. Informed sources said on Thursday that Saudi Arabia which was providing oil roughly worth $1 billion annually on deferred payment will continue to offer this facility in future.

However, this year the government was expecting more than $1 billion Saudi oil facility. Pakistan has been getting this facility since 1998 when it decided to go nuclear.

Sources said that Saudi Arabia has also assured to offer preferential treatment in case US government decided to attack on Iraq. "We will get uninterrupted Saudi oil in any emergency and too on deferred payment", a source said.


The Oil Companies Advisory Committee (OCAC) on Tuesday kept the prices "unchanged" of four main oil products for the current fortnight. The government has again taken a hit on revenue collection for the second time in the last 10 days by reducing the petroleum development levy (PDL) to mitigate the impact of international oil price spiral on consumers as it has increased by 1.93 per cent during the last fortnight.

The committee announced the decision after a gap of one day. In a statement it said that the average fob price of all products had gone up. Gas oil prices had surged to $29.27 per barrel from $28.24. However, fuel oil prices had dropped to $162.60 a ton from $164. Kerosene price also rose to $31.76 a barrel from $30.38, while naphtha price shot up to $239.39 a ton from $233.94 a barrel.


Shell Pakistan will press for an increase in government commissions on petroleum products to 4 per cent from the current 3.5 per cent because the rise is vital for investment, Shell Pakistan Chairman Farooq Rehmatullah said on Thursday.

The Ministry of Petroleum has hinted that it wants to cap the commissions, or 'margins', at 3.5 per cent but Rehmatullah told a news conference he would hold talks with the new government to press for an increase because 4 per cent commission was promised under the deregulation road-map.


A number of Saudi business houses have expressed their desire to tie up with their Pakistani business counterparts, it was announced during a seminar organized by the Institution of Engineers-Pakistan, Eastern Province Chapter.

IEP organized the seminar to showcase the emerging potential of Pakistan in the field of Information Technology at Hotel Al-Gosaiabi, Al-Khobar on the occasion of the ITCN-Saudi Arabia, currently being held at the Dhahran Expo Centre.


The cash shortfall of Water and Power Development Authority is expected to be close to Rs30 billion (0.8pc of GDP) in 2002 and will eventually be borne, to a large extent, by the budget in the form of deferred debt service payments, says the IMF.

"Wapda's financial performance has been shaky over the past years and has sharply deteriorated in 2001-2002," states the 2002 Country Report of the IMF.


Despite the fact the Sindh government has paid back all its debts of Rs11 billion to the State Bank, the magnitude of the problems remains large owing to disparities which are a source of despondency.

Dr Sheikh said that since 1989 Sindh had to borrow owing to the fiscal indiscipline and the debts were billed at Rs20 billion.

He said that Sindh owed Rs11 billion to the SBP and for the first time in 11 years the province succeeded in having zero-debt vis-a-vis the SBP.