New bank on the cards to loan small enterprises
The government has decided to establish Small and
Medium Enterprise (SME) Bank with an initial capital of one billion
rupees to offer loans to small and medium enterprises.
"This new SME bank will be inaugurated on Jan
1 to arrange considerable loans for our small and medium enterprises
in order to further strengthen pace of industrialization in the
country," said Minister for Finance Shaukat Aziz.
On Wednesday, he said that Small Business Finance
Corporation (SBFC) and Regional Development Finance Corporation (RDFC)
were being merged into one organization to be called SME Bank.
He said that SME Bank would work like Micro Finance
Bank and would be run by highly competent professionals, a number of
whom had just been recruited from the private sector.
"We are making a powerful Board of the SME
Bank so that it could function without any outside interference,"
the Finance Minister said. He said the Board would be totally
independent to take vital decisions to promote SMEs in all the four
"And after having streamlined on modern lines
the SME Bank will be privatized," Mr Aziz said, adding that the
government would ensure that the new bank should offer loans to
deserving small and medium enterprises.
The finance minister also said that from the first
week of January 2002, he would start holding separate negotiations
with the United States, Japan, Germany, France and South Korea for
getting the issue of interest rate finalized on loans, rescheduled by
the Paris Club recently.
The process of negotiations, he said, would have
started by now had there been no Christmas and New Year holidays.
These negotiations, he said, would have to be finalized by Sept 30
next year as per the decision of the creditors of the Paris Club.
SBP making changes in forex system
The State Bank of Pakistan (SBP) is making
necessary changes in the foreign exchange system for the benefit of
exporters. SBP Governor Dr Ishrat Hussain announced on Wednesday that
the process of changing the foreign exchange system would be completed
before the end of this year.
Speaking at a luncheon gathering of the
businessmen, organized by the North Karachi Association of Trade and
Industry (NKATI), the SBP Governor made it clear that there was no
ceiling fixed for the bank credits for the private sector.
FDI records 58pc rise in July-Nov
Foreign Direct investment (FDI) has recorded 58 per
cent increase to $161.60 million in July-November 2001 against $102.40
million during the corresponding period last year.
"This shows that foreign investors have
started reposing confidence in Pakistan and business-friendly policies
of the government," says an announcement of the Board of
Investment (BoI), on Monday. It expects that FDI flow during the
current financial year will be around $500 million.
SBP keeps banks liquid ahead of year-end
The State Bank on Wednesday left much of excess
liquidity in the inter-bank market to help banks finance the year-end
The SBP sucked in Rs9.3 billion from the market and
left more than this to keep banks liquid enough at the year-end: the
auction of the treasury bills through which the SBP siphoned off
excess liquidity had generated Rs20 billion bids. But the SBP accepted
only Rs9.7 billion bids at discounted rates to mop up Rs9.3 billion -
and left the rest of the liquidity in the market.
"The purpose is to help banks finance
anticipated withdrawals at the year-end," said treasurer of a
leading foreign bank.
Telephone line rent increased
The Pakistan Telecommunication Authority on Monday
authorized the PTCL to increase monthly line rent of its connections
across the country.
"PTA has allowed a cap of Rs300 per month on
line rent, which is higher by Rs18 as compared to the existing
rate," a PTA press release said. The PTA has approved the PTCL's
proposal to reduce installation charges from Rs3,690 to Rs2,000.
3 Chinese firms to invest in oil, gas
Heads of three Chinese Petroleum Companies met
President General Pervez Musharraf on Saturday and expressed their
willingness to invest in Pakistan for undertaking oil and gas
The President told them that his government was
laying greater emphasis on the development of the natural resources,
particularly, oil, gas and coal. He assured the foreign investors
particularly those from the friendly country of China that they would
get all possible incentives to undertake the task.
Petroleum Minister Usman Aminuddin who was present
during the meeting told APP that the companies would soon enter into
formal agreement with Pakistan for exploration of oil and gas. The
companies, he added, have also expressed their interest in off-shore
M.F.M.Y Industries to buyback at Rs11.50
The board of directors of M.F.M.Y Industries has
decided to buyback shares from the minority shareholders at the rate
of Rs.11.50 per share, leading to its subsequent delisting from the
Karachi Stock Exchange as sought by the management.
The buyback price has already been approved by the
Karachi Stock Exchange and the company's board meeting will be held on
Dec 28, to give green signal for the moping operation, according to
PIBs get huge response
Despite a one per cent cut in the coupon rate the
10-year Pakistan Investment Bonds attracted many investors on Saturday
when the bonds were first sold at the reduced rate.
The State Bank said it received Rs26.45 billion
bids for the bonds — against the target of Rs10 billion.
The SBP sold about Rs10.45 billion worth of bonds
at the cut-off premium of 37 paisa per Rs100.