INDUSTRIAL PRODUCTION FALLS
Production in various
segments of large-scale industrial sector except for pharmaceuticals
and leather fell sharply in the first two months of the current
fiscal year giving clear signals that economic growth as well as
exports would be affected significantly this year.
Latest official data shows
that textile sector, the main foreign exchange earner, posted a
growth of just 6.3 per cent compared to 30 per cent during
July-August last year.
Production of cotton yarn
dropped to 7.1 per cent from 17.4 per cent and cotton cloth fell to
6.5 per cent from 47 per cent during the period under review. These
two items fetch $3 billion as export proceeds for the country.
Food and beverages growth
rate of production fell to 9 per cent compared to 16.8 per cent in
the corresponding period last year. Wheat milling dropped 3.8 per
cent from 21.1 per cent and cooking oil production growth was just
7.1 per cent compared to 42.1 per cent during the corresponding
period of last year.
Production of chemicals,
which is a sign of industrial activities, grew at the rate of 5.9
per cent compared to 16 per cent in the same period last year. The
country achieved the 8.4 per cent GDP growth last year and chemical
usage was on much higher side.
Metal industries went under
reverse gear as its growth fell by (minus) 62pc from an increase of
4.7 per cent during the last two months of the previous year. Pig
iron and billets, which are used for infrastructure development and
housing and construction, fell sharply during the period.
Fertilizer production also
showed poor performance as the growth remained at 15pc while it was
97.3 per cent during the two months of last year reflecting the
agriculture sector's slow growth in the coming months. The cotton
crop alone valued at over Rs140 billion (100,000 bales equal to Rs1
The booming automobile,
which played key role in boosting the large-scale manufacturing
sector last year, showed a growth of 29 per cent compared to 51 per
cent the same period last year.
Output of tyre and tubes
dropped from 17.7 per cent to 13.3 per cent and electronics from
84.5 per cent to 6 per cent during the period.
Only the pharmaceutical
sector grew by 14.9 per cent from negative 1.4 per cent and the
leather products rose to 14.5 per cent from negative 9.1 per cent
during the said period.
PAKISTAN PURCHASES 0.650M
Pakistani traders are
expected to import more wheat with deals totalling 200,000 tons
expected for January-February shipment, traders and a government
official were quoted as saying.
Traders have already
finalized import deals for 650,000 tons of milling wheat, after a
duty cut this year, and cargoes of 300,000 tons had reached Pakistan
up to Nov 15.
But Qadir Bux Baluch,
Pakistan's wheat commissioner, said traders were likely to buy more
to meet growing need in Karachi.
"Most of the previous
imports were for Karachi and Sindh which still needed extra supplies
of maybe another 200,000 tons or so," Mr Baluch said.
"Traders are continuously in the market at the moment."
Karachi-based traders said
supplies of locally produced wheat for the city of more than 15
million people were slow after bad weather trimmed last year's crop
and also damaged its quality.
Pakistan's wheat output
fell to 21.5 million tons from a target of 22.5 million after rain
in March and wind in May damaged crops in central Punjab, which
produces 80 per cent of the country's wheat.
The cost of trucking wheat
from Punjab is also reflected in higher prices in Karachi.
Muhammad Najib Balagamwalla,
chief executive of Pakistan-based Seatrade Group, said the poor
quality of government wheat was the main reason behind a surge in
imports for the city.
"The government is
offering 30 per cent damaged wheat grain but prices are as high as
high-quality Australian wheat," Mr Balagamwalla said.
"The landing costs of
imported wheat are comparatively cheap in Karachi so millers and
traders are aggressively booking cargoes from abroad," he
RS250BN FLOW FOR
RECONSTRUCTION TO BOOST ECONOMY
President General Pervez
Musharraf has said that the funds pledged at the donors' conference
would be used for bolstering the quality of life as the government
did not only want to restore the devastated infrastructure, but to
pursue a need-based strategy.
Addressing a ceremony
marking the launch of the National Volunteers Movement, the
president said that the injection of a hefty Rs250 billion into
reconstruction work would help bolster economic activity in the
He announced Rs150,000 each
for rebuilding over 400,000 houses destroyed by the quake.
"This will surely be
helpful in mitigating the sufferings of people in the 28,000sq-km
mountainous region of NWFP and Azad Jammu and Kashmir."
He said that under the
owner-based strategy for reconstruction of houses the government
would extend an additional Rs25,000 to people aimed at raising
houses in conformity with standards of quake-proof structures.
Australian Prime Minister
John Howard has assured his country's full support for the
reconstruction and rehabilitation efforts as he announced an
additional US$37 million for quake victims.
Mr Howard announced this
while visiting quake-stricken Dhanni village, some 50km along the
Neelum Valley Road. He played cricket with children living there in
a makeshift relief camp for quite some time, besides visiting a
field hospital run by a 96-member team.
Appreciating the services
being rendered by Australia's medical team, he said they were
boosting the morale of locals.
"I am pleased to
announce that Australia will provide a further 50 million
(Australian) dollars (US$37 million) for victims of the disastrous
October 8 earthquake in Pakistan, to provide relief for the winter
and for reconstruction in the longer term," he told reporters.
Australia has already donated US$10.4 million.
PAKISTAN SEEKS GREATER
ACCESS FROM EU
Pakistan has sought greater
market access from the European Union, the United States and other
major Western countries for its exports to offset negative impact of
the October 8 earthquake on its overall economy and growth momentum,
said a newspaper report.
President Gen Pervez
Musharraf and Prime Minister Shaukat Aziz have personally taken up
this issue with a number of countries as part of their recent
campaign for securing maximum economic concessions and financial
help for reconstruction and rehabilitation effort.
Most of the EU members have
shown willingness to treat Pakistan on a par with Sri Lanka, the
report said. Pakistan had requested the EU to provide those special
concessions under the new generalized system of preferences to be
effective from January 1, 2006 which they have committed to Sri
Lanka in the aftermath of tsunami.
$37.3M ADB LOAN FOR
The Asian Development Bank
(ADB) will help to bridge a pending electricity shortfall and
encourage the development of hydropower resources in Pakistan
through a new $ 37.3 million loan.
The loan will help finance
an approximately 80 megawatt power plant located downstream of the
Mangla Dam on the Jhelum River in Azad Kashmir.
This is ADB's first
proposed assistance to a private sector hydropower project in
Pakistan and the first such project to be developed in the region.
The New Bong Escape
Project, so called because of its position on the escape channel
from the existing Mangla power station, will be a
"run-of-the-river" scheme involving no new dam or
reservoir and will thus have minimal environmental and social
The electric power
generated by the project will feed into the national grid, according
to an ADB news release.
RETURN ON 6-MONTH T-BILLS
The State Bank raised the
cut-off yield on benchmark six-month treasury bills, signalling an
interest rates hike in future.
The SBP held an auction of
T-bills and picked up Rs61.945 billion, much less than the target of
Rs90 billion. A significant change was the rise in the six-month
T-bills cut-off yield which was pushed up by 15 basis points.
However, the SBP picked up
the minimum amount, just Rs768 million, for six months at the rate
of 8.3910 per cent. The highest amount of Rs53.102 billion was
collected for 12-month T-bills at a cut-off yield of 8.7907 per
cent. The central bank raised Rs3.337 billion for three-month
T-bills at a cut-off yield of 8.1 per cent.
The SBP had set a target of
Rs90 billion for the T-bills auction but remained far behind despite
huge inflows of Rs90 billion scheduled for the same day.
US TEXTILE BUYER HINTS AT
A leading US textile buyer,
Steve and Barry, which runs 98 stores, has hinted at doubling
purchases from Pakistan from $50 million to $100 million.
This was stated by Jitendra
Bhatia, manager, sourcing and vendor development, while speaking to
members of the Pakistan Readymade Garments Manufacturers and
Exporters Association (Prgmea) recently.
Mr Bhatia said his firm was
keen to buy jeans, jackets and sportswear from Pakistan for sale to
university students who were its major customers. He said the firm
had shifted its offices to India to save working cost and had
appointed agents in Pakistan.
POULTRY IMPORT FROM SEVEN
Pakistan has imposed a ban
on import of poultry products from seven more countries as a
precautionary measure against any outbreak of avian flu in the
The decision was made
public through a notification issued here by commerce ministry by
amending the Imports and Exports (Control) Act, 1950 .
According to the
notification, import of poultry and poultry products and captive
live birds have been banned from South Korea, Japan, Myanmar,
Taiwan, Hong Kong, Malaysia, South Africa and Greece.
A number of other countries
from where import were banned earlier include Vietnam, Thailand,
Indonesia, Cambodia, Laos, Malaysia, Russia, Kazakhstan, Mongolia,
Turkey, Romania and China on account of Avian Influenza H5N1 strain.
SIEMENS' PROFIT RISES
Siemens Pakistan reported a
profit of Rs779 million during the year 2005 ending September 30,
showing a rise of 89 per cent over the last 2004. Basic earning per
share rose to Rs100.24 compared to Rs53.10 a year earlier.
EIGHT PARTIES PRE-QUALIFY
FOR PS BID
Commission Board has pre-qualified eight parties for the sale of
Pakistan Steel. The board, which met under the chairmanship of
Privatization and Investment Minister Dr Abdul Hafeez Sheikh,
pre-qualified eight parties for entering into the data room for due
diligence of Pakistan Steel Mills Corporation (PSMC), while three
parties were conditionally pre-qualified subject to the formalities
of additional information by them.
The meeting was informed
that the successful bidder for KESC - the consortium of Hasan
Associates led by the Al-Jumaih Group of Saudi Arabia - had
deposited $100 million out of the total bid offer of Rs20.24 billion
and a letter of acceptance had been issued to them, while the
remaining proceeds would be received by the end of the current
month, followed by handing over the management control of the
company to the consortium.
BD OFFERS INCENTIVES TO
After achieving $6 billion
in garments and made-up exports, Bangladesh is now entering home
textiles in a big way by allowing duty-free import of plant and
machinery as well as raw material, including raw cotton and
Pakistan, which has been
enjoying an edge in home textiles the world over, will be the first
victim of this development because Bangladesh besides having its
internal advantages is also categorized as Least Developed Country (LDC)
that allows it to have duty-free access to the EU and US markets.
Against this Pakistan is
presently paying 13.1 per cent punitive duty on its exports of
bedlinen to European Union (EU) plus 12 per cent customs duty,
thereby taking a net impact of over 25 per cent.
GOLD PRICE HITS NEW PEAK
The rising trend of bullion
rate on international markets continues to exert pressure on the
domestic prices at a time when marriage season is at its full swing.
Gold rates on Tuesday surged to Rs9,635 per 10 grams from Rs9,515 a
Gold price was Rs9,085 per
10 grams on November 11, 2005. In the last 12 days, gold became
costlier by Rs550. The 10 tola gold bar now costs Rs112,620.