TEXTILE EXPORTS UP 13.6PC
The total value of textile
exports increased by 13.64 per cent to $1.602 billion during the
first two months (July-August) of the current fiscal as against
$1.413 billion the same period of last year.
Official data showed that
the export of garment, cotton yarn, bedwear and cotton cloth
registered a massive growth, while knitwear, tents, synthetic
textile and made-up articles recorded a negative growth during the
period under review.
Product wise details showed
that the export of cotton yarn increased by 45.51 per cent, cotton
cloth by 40.97 per cent, readymade garments by 65.54 per cent,
bedwear by 42.36 per cent and towels by 2.50 per cent.
However, export of knitwear
declined by 26.33 per cent, tents, canvas and tarpulin by 39.58 per
cent and art, silk, synthetic textile by 34.47 per cent during the
period under review.
The export of primary
commodities during July-August 2005-06 registered an overall growth
of 21.37 per cent over the same period of last year. The export of
rice increased by 39.25 per cent, raw cotton up by 86.7 per cent and
fish & fish preparations rose by 93.22 per cent.
While the other three
important sectors of the economy - engineering, surgical goods and
leather tanned - recorded a decline of 15.33 per cent, 1.13 per cent
and 26.2pc, respectively.
Further analysis showed
that the export of electric fans declined by 7.64 per cent and
specialized machinery for particular industries fell by 30 per cent.
While auto parts registered a growth of 8.48 per cent during the
period under review.
The export of leather
manufacturers increased by 32.94pc and footwear by 52.42 per cent
during the July-August 2005-06.
The export of cutlery
registered a growth of 16.54 per cent, sports goods 9.80 per cent
and petroleum products 13 per cent during the period.
The export of jewellery
declined by 24.46 per cent, furniture 85.36 per cent and molasses by
44.06 per cent. Export of gems increased by 2.35 per cent.
ECONOMIC GROWTH TO REMAIN
More than two million
people have been displaced and property worth billions of rupees
lost due to the earthquake, but some economist and analysts believe
that economic growth will remain unhurt.
With each passing day loss
of life and property is rising and the situation demands huge
spending to support the dying people, while the cost of
rehabilitation of the displaced is not estimated. However,
economists believed that huge demand for monetary spending would
create serious shortage of funds to be resulted into widening of
budget deficit, wrapping up of several projects and reduce the
spending under annual development plan.
Some economists insisted
that the economic growth would remain unhurt as the areas destroyed
were insignificant in terms of contribution to the economic growth
and the country would achieve 7.6 per cent GDP growth for the year
"Neither any textile
mill was damaged nor any harm was caused to the cotton crop,"
said a textile mill owner Abdul Aziz. He said the industrial
infrastructure was intact while the agriculture also remained
unhurt. Textile sector would be able to achieve its production and
export targets as it received no damage by the earthquake.
Similarly, the auto, engineering, water and power sectors would
continue to move smoothly.
Economists said that
several industrial sectors would witness enhanced economic activity
as a result of reconstruction of the destroyed areas. "The
contribution of this region to the country's economic growth and GDP
is minimal," said Tanvir Abid, head of research at Live
The government has set the
budget deficit at 3.8 per cent (Rs263 billion) of the GDP for the
year 2005-06. It has been announced by the government that the aid
committed by the international community is insignificant, which
means that that the government would have to bear the maximum load
of spending for the rehabilitation of quake-hit areas.
Analysts estimated that the
government would have to spend at least Rs50 billion for the
settlement of about over two million displaced people.
BUDGET DEFICIT MAY WIDEN TO
The budget deficit is
likely to be in the range of 4.1 per cent to 4.3 per cent of the GDP
during the fiscal year 2005-06 as against 3.8 per cent announced in
the budget following the fallout of the Saturday's earthquake on the
An analytical report of ABN
Amro said that the budget deficit would be wider than their earlier
forecast of 4 per cent of the GDP.
It has to be stressed,
however, that it is still too early for a definitive assessment of
the final outcome on this score.
The report also forecast
that the CBR would be unable to maintain the impressive momentum of
tax collection it has managed so far in the first quarter of this
year, and full year tax revenues will fall short of the budgeted
target by around 1.3 per cent.
According to the report,
the earthquake will have direct fallout on the government's
budgetary position. As the enormous scale of rebuilding effort
required, it becomes clear the initial Rs5 billion allocated for
relief/reconstruction will need to be upped substantially.
GOVT SEES NO MAJOR
Pakistan's finance managers
insist that the devastation caused by Saturday's earthquake will
have no negative impact on the economy or budgetary targets.
Independent economists just do not agree, although, they say, it is
difficult to tell the exact extent of the impact of the tragedy at
this point in time.
"It is difficult to
tell the extent of the likely impact of the earthquake on the
economy as we don't yet know the exact magnitude of the damage, and
how much will rehabilitation and reconstruction effort cost,"
says economist Dr Faisal Bari. "But the colossal tragedy will
definitely affect economy and the government's budgetary
earthquake is reported to have killed more than 40,000 people so
far, and rendered more than 2.5 million homeless, razing the entire
cities to the ground in the NWFP and Azad Jammu & Kashmir.
Thousands, including women and children, are yet to be rescued from
the debris of the collapsed buildings.
INDUSTRIAL OUTPUT HIT BY
A number of labour force
and workers employed in city's mega industrial estates have left for
their homeland to either mourn the death of their family members or
manage food and shelter for the loved ones who have survived the
earthquake that claimed over 40,000 lives in northern Pakistan.
Many industrial workers
from the quake-hit areas are in the process of going back, as huge
rush at upcountry bus routes and railway stations is causing delays
in their timely departure.
A large number of workers
and labour force, who usually prefer going back home a few days
ahead of Eid with gifts and parcels for their children and parents,
will now be facing a strange ordeal after reaching home empty handed
- with only tears in their eyes.
EC TO REVIEW DECISION ON
Director General Trade Peter Carls has assured that the EC would
look into the dumping margins of eight Pakistani exporters of
bedlinen disclosed recently.
He was talking to
Pakistan's Commerce Secretary Syed Asif Shah at Geneva, according to
a statement issued by the commerce ministry.
Mr Peter assured that the
matter would be looked into before sending the recommendation with
regard to imposition of final anti-dumping duty to the EC Council of
CUT-OFF YIELD ON TBS
The State Bank on Wednesday
sucked in Rs4.527 billion through auction of three, six and 12
months treasury bills and kept the cut-off yield on the papers
Market experts were
expecting an increase in the cut-off yield on 6-month paper in the
wake of rising inflation and higher interest rates.
The weighted average annual
yield on 6-month and three-month TBs also remained unchanged at
8.1388 and 8.1 per cent, while the yield on 12-month paper showed a
slight increase to 8.7907 from 8.7896 per cent.
The SBP accepted bids of
Rs3.386 billion for three-month paper, Rs240 million for six-month
and Rs644 million for 12-month bills. The SBP remained below the
auction target of Rs5 billion.
SHANUL HAQ HAQEE PASSES
Noted poet and renowned man
of letters Shanul Haq Haqqee died from complications of lung cancer
in Canada on Tuesday. He was 88. Mr Haqqee leaves five sons and one
daughter. Like his wife, well-respected teacher Salma Haqqee who
died exactly two years ago, he was buried in Toronto, Canada, where
five of his children were by his side when he died in his sleep.
PAKISTAN LOBBYING FOR CUT
Pakistan has tabled a
proposal on industrial goods relating to tariff reduction formula
and treatment of unbound tariffs. A senior official was quoted as
saying that Commerce Minister Humayun Akhtar Khan was lobbying for
acceptance of Islamabad's proposal for reduction of tariffs on
Elaborating further, the
official said that Pakistan was proposing a simple Swiss formula
with two distinct coefficients for developed and developing
countries. These coefficients should be based on an objective
RECONSTRUCTION EFFORTS MAY
Pakistan's efforts to
recover from the worst natural disaster in its 59-year history are
expected to eventually boost slowing economy and support its
currency and stocks.
But analysts said given the
northern areas' small contribution to the country's $100 billion
economy, any losses would be more than compensated by the
reconstruction efforts and aid inflow.
"With the epicentre of
the losses in the northern areas, the impact on the wider economy
will not be large. In fact, as reconstruction picks up it will be
positive for the economy," said Sakib Sherani, ABN AMRO's head
of research in Islamabad.
infrastructure of ports, airports, dams, factories,
telecommunications, financial system, power plants and refineries
has largely been spared, and the northern areas constitute a minute
portion of the country's agricultural land and industrial estates,
Mr Sherani added.
BANKS ASKED TO DEFINE
The State Bank of Pakistan
has directed all banks to immediately develop a well-defined and
transparent policy regarding the dormant accounts. The SBP in a
circular observed that the banks were classifying the deposit
accounts as dormant or inoperative without intimating the same to
accountholders causing considerable inconvenience to them.
immediately develop a well-defined and transparent policy, if not
existing presently, duly approved by the president of the bank for
the purpose," says the circular.
GARMENT EXPORTERS SEEK
The Pakistan Readymade
Garments Manufacturers & Exporters Association (Prgmea) has
urged the Ministry of Commerce to extend the research and
development (R&D) subsidy to promote garment exports to Turkey
and other non-traditional markets.
SBP INJECTS RS19.2BN INTO
The State Bank has injected
over Rs19 billion into the banking system that witnessed heavy
discounting last week due to severe liquidity crunch.
The SBP conducted reverse
Open Market Operation (OMO) and injected Rs19.2 billion to save the
market from shortage of liquidity. Due to heavy withdrawal from
banks, primarily to avoid Zakat deduction, the banking system
witnessed a serious scarcity of liquidity.
The shortage pushed the
inter-bank money rates very high and the overnight rate touched 8.9
per cent per annum, just below the discount rate of nine per cent.
AUTOMAKER PROFIT UP BY 37PC
Dewan Farooque Motors
Limited (DFML) - the last of the listed car manufacturers -
announced financial figures for the year ended June 30, 2005 on
Monday, posting 37 per cent growth in after tax profit to Rs306
million, from Rs223 million in the previous year.
The Board declared cash
dividend at 15 per cent. Diluted earning per share (eps) for FY05
worked out at Rs3.97 as against Rs2.90 during FY04. The market price
of the DFML stock on Monday stood at Rs27.60, which produced the
price-to-earnings (p/e) ratio of 7x.
Analysts stated that higher
profit ensued from dual impact of volumetric growth in sales and
improved operating margin, the latter rising to 7.7 per cent from
6.4 per cent. The company sold 15,999 vehicles during FY05,
reflecting growth of 33 per cent from 12,031 units sold last year.