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Last updated: Friday 23 Dec, 2005-12.30 P.M (PST)

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KARACHI
Today 12 26 38 Sunny
Tomorrow 11 27 38 Sunny
Day after 11 28 38 Sunny
LAHORE
Today 1 20 87 Sunny
Tomorrow 2 20 87 Sunny
Day after 2 21 87 Sunny
ISLAMABAD
Today 0 18 59 Sunny
Tomorrow 0 18 59 Sunny
Day after 0 21 59 Sunny
HUM%: Humidity In %
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updated: Fri - Sun 23-25 Dec, 2005

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KARACHI         - 021 LAHORE          - 042 ISLAMABAD    - 051 FAISALABAD   - 041 MULTAN          - 061 PESHAWAR    - 0521 CANADA          - 1 KUWAIT           - 965 INDIA               - 91 IRAN                - 98 U.K                   - 44 U.A.E                - 971 U.S.A                - 1

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IN THE NEWS
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. PAKISTAN
 

 

 

 

 
  PAKISTAN

Dec 26 - Jan 01, 2006

PRODUCTION OF LOCAL BUSES FALLS BY 54PC

After recording a 28 per cent rise in bus production during 2004-05, the local bus makers find themselves in hot waters because of continuous decline in sales of buses for the last five months owing to investors' reluctance in bringing new large buses in the city.

Rising diesel prices can be attributed as one of the main reasons in making investors' reluctant in buying new buses due to low profit margins and higher per day operational cost of a bus.

Production and sales of locally- produced buses have declined by 54 per cent and 32 per cent to 328 units and 395 units, respectively, during July-November, 2005 as compared to 722 units and 587 units in the same period of 2004.

In sharp contrast, bus production in 2004-05 rose by 28 per cent to 1,762 units from 1,380 units in 2003-04 due to the availability of bank credit, introduction of intra-city bus routes and rising sales under the Urban Transport Scheme (UTS) in Punjab and Sindh.

Hinopak and Nissan, are the main market players besides, Dong Feng, Master and Isuzu. Nissan has not produced any unit during July-November 2005 as compared to 54 buses produced in the same period of 2004. Hinopak produced 278 buses in July-November, 2005 as compared to 626 units in the same period of last year.

"We are hardly getting 10 per cent orders from the investors these days," a leading assembler of buses was quoted as saying. Only those investors are buying the buses who intend to ply them on inter city routes.

There has been no booking of buses by the investors for the UTS during the last five months. Many buses of the operators have already been seized by the banks for default on payment of loan instalments.

PAKISTAN RETAINS US MARKET SHARE

Pakistan has succeeded in protecting its US market share for apparel products at the Sixth Ministerial Conference held in Hong Kong from Dec 13 to 18, by restricting market access of Least Developing Countries (LDCs) at 97 per cent of products under annexure F of the final WTO's declaration.

The annexure F tabled by Pakistan withhold the balance of three per cent of products originating from LDCs from getting quota and duty-free access to US market. This was adopted in the final draft of the WTO's HK declaration on the insistence of Pakistan. This would mean that US could use this space of three per cent for political pressure on LDCs including Bangladesh, Cambodia and Vietnam as their apparel exports to US have grown manifold soon after the quota-free regime started from January 1, 2005.

Most of the LDCs have been giving tough time to Pakistani exporters of apparel products in the US market and their exports have shown tremendous growth owing to duty and quota free market access to US market.

Pakistan's apparels compete with Bangladesh and other LDCs in 40 products in the US market and it constitutes 20 per cent of its exports. However, the annexure F will help the country to safeguard its market share in the US.

Despite the fact that China and India also have big stakes in global textile market of around $300 billion but unlike Pakistan they have diversified their exports and could sustain some cuts in their market share.

The rapidly growing textile and apparel industry in LDCs, Bangladesh and Cambodia and Vietnam in particular, have threatened Pakistan's exports to US and recently some producers of textile made-up visited Bangladesh in order to relocate their industry by entering into joint ventures.

COTTON BODY ESTIMATES OUTPUT AT 12.7M BALES

The Cotton Crop Assessment Committee (CCAC) was informed that 10.219 million bales had reached the ginning factories by December 15, 2005 which was 12.9 per cent short when compared with the arrivals on the same date last year.

The committee met to review the current crop size with Federal Minister for Food and Agriculture Sikandar Hayat Khan Bosan in the chair. The meeting was attended by Minfal ADC, FDPP DC, vice-president PCCC, Secretary Agriculture Sindh, other senior officers of the department, TCP and representatives of PCGA, KCA and growers.

It was reported that the wide gap in arrivals noticed at the early season had declined from 46 per cent to 13 per cent.

Besides, the ginning output this season was also reportedly better than last year.

ETISALAT TO MAKE PTCL PAYMENT IN FIVE YEARS

Pakistan has given United Arab Emirates firm Etisalat five years to pay for a 26 per cent stake in Pakistan Telecommunication Co. Ltd. (PTCL), Etisalat's chief executive as quoted as saying.

Pakistan's biggest privatization ran into trouble when UAE monopoly Emirates Telecommunications (Etisalat) failed to meet payment deadlines after offering $2.6 billion for a 26 per cent stake in PTCL, topping the next highest bid by $1.2 billion.

The UAE and Pakistan said they had clinched a deal to salvage the sale but gave no details.

"There were several pending issues ... part of the deal between us and the Pakistani government was to pay part of the amount over the next five years," Etisalat Chief Executive Mohamed Hassan Omran said on Al Arabiya television.

DOMESTIC GAS TARIFF RAISED BY 15.87PC

The Oil and Gas Regulatory Authority (Ogra) has determined an average increase of about 15.87 per cent in domestic gas price and 13.06 per cent for the remaining categories of consumers, including commercial, industrial, CNG, cement and power but excluding fertilizer. The tariff increase is set to go into effect from January 1, 2006, throughout the country.

Ogra has revised these prices through two separate interim orders relating to the tariff schedules of Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL).

BUDGETARY BORROWING SURPASSES TARGET

The government's borrowing for budgetary support in five months and ten days has crossed the target for the whole year 2005-06. The speedy borrowing took a jump of Rs27 billion in just a week to reach a total of Rs101.379 billion against the target of Rs98 billion set for the year 2005-06. The government had borrowed Rs89.674 billion in the corresponding period of the last year.

The budgetary borrowing, last week, stood at Rs83 billon but the fast growth in borrowing has set a new trend which might lead to a very high figure of budgetary borrowing by the end of the fiscal 2005-06.

INVESTMENT IN T-BILLS

Investing in Treasury bills has become more attractive as it provides a chance to earn double digit profit. It is risk free and encourages banks to invest more in government papers.

The State Bank of Pakistan (SBP) siphoned off the liquidity from the money market as it went far beyond its target of Rs45 billion in the Treasury bills' auction.

The SBP realized Rs68.479 billion through the auction but no change in T-bills rates were offered.

However, most of the bids were received for one year T-bills and the bank raised Rs64.016 billion alone for the same maturity. The SBP received bids worth Rs89.022 billion. The banks found one year maturity more attractive for investment as the spread between 3 months and one year is substantially higher for lucrative investment.

The cut-off yield for 3-month, 6-month and 1-year maturity remained unchanged with 8.100 per cent, 8.29 per cent and 8.79 per cent respectively. The SBP raised Rs2.734 billion and Rs1.728 billion for 3-month and 6-month T-bills, respectively.

THAILAND KEEN TO BOOST TRADE

The Consul General of Thailand, Praphat Chantaharn, has emphasized the need to identify bottlenecks to promote trade between Pakistan and Thailand.

"These irritants should be removed so that the existing potential of bilateral trade and investment could be exploited to the fullest," he remarked while addressing the members of the Karachi Chamber of Commerce and Industry (KCCI).

FTAS WITH 4 STATES LIKELY

China, Malaysia, Thailand and Turkey have agreed to separately sign Free Trade Agreements (FTAs) with Pakistan preferably during the current fiscal year.

According to a newspaper report, the signing of FTAs with China, Malaysia and Thailand was in the final stages, while talks with Turkey were scheduled to start on Thursday.

SUGARCANE CRUSHING

The sugar mills in Sindh indicated that they would resume sugarcane crushing in this week following government assurance to link sugarcane prices with sugar contents, a senior government official was quoted as saying.

The representatives of the sugar mills, sugarcane growers and other stakeholders held a meeting with Minister for Food, Agriculture and Livestock, Sikandar Hayat Bosan, in Karachi, in which the mill owners indicated that they would start crushing this week, Sugarcane Commissioner, Inayatullah Khan told from Karachi where he also attended the meeting.

INFLATION TO BE BROUGHT DOWN, IMF ASSURED

The government has assured the International Monetary Fund (IMF) to take more measures to bring down inflation from 8.4 per cent to 8 per cent by the end of the current financial year as it is still hurting the common man in the country.

According to a newspaper report, the Fund officials were assured that the average inflation rate for 2005-06 was likely to be less than 8 per cent by June 30, 2006 due to the base effect viz- a-viz oil prices.

Since IMF's assessment on Pakistan's economy is taken seriously by international lending agencies including banks, the government wanted to further reduce inflation, particularly the Consumer Price Index (CPI).

TEA SMUGGLING CAUSES RS470 MILLION LOSS

The smuggling of tea continues unabated registering 100 per cent increase in July-October 2005, as against the same period of 2004. Pakistanis had sipped 40 million kg of the smuggled tea during 2004-05 besides, consuming 130 million kg imported through legal channels.

An estimated 14.182 million kg of tea (813 containers) arrived in the country under the Afghan Transit Trade (ATT) during July-October 2005, as against 6.845 million kg (457 containers) in the same period of 2004.

The national kitty is reported to have suffered a loss of Rs470 million in July-October 2005 based on the average tea price of $1.80 per kg on account of smuggling of 14.182 million kg of tea and the total incidence of duty and taxes of over 30 per cent is taken. This information based on documentary evidences was conveyed to the Central Board of Revenue (CBR) by the Pakistan Tea Association (PTA).

CELLPHONE FIRM PLANS TO INVEST $500M

A leading cellular mobile telephone company plans to invest $500 million during the year 2006, taking its total investment in the country to well over $1.75 billion by the year end.

"We have been encouraged by the positive economic and infrastructure development trends in Pakistan and have decided to raise the level of our investment portfolio in Pakistan," Chairman Orascom Telecom, Naguib Sawiris told reporters soon after his meeting with Prime Minister Shaukat Aziz.

Mr Sawiris was flanked by President and CEO of Mobilink Pakistan Zouhair A. Khaliq during a news conference at a local hotel. About the quality of service issue, Mr Sawiris, who is on a short visit to Pakistan, said Mobilink had launched its own fibre optic cable laying project which would provide the company independence from relying on other carrier (Pakistan Telecommunication Company Limited) for its telecom services.

IRON SHEETS IMPORT FROM INDIA ALLOWED

The Ministry of Commerce has allowed the import of corrugated galvanized iron sheets from India for a period of one month commencing from December 14, 2005 to January 13 for exclusive use in rehabilitation of earthquake victims.

The import of such sheets would only be made via land route and would subject to the verification and recommendation of the Federal Relief Commission, Ministry of Commerce stated in an SRO dated December 13, 2005.

EXPORTS FROM SIALKOT DRY PORT DECLINE

Exports from Sialkot Dry Port declined by Rs685 million during the month of November compared to the same month last year. The dry port handled 2,400 export consignments destined for other countries with a value of Rs2,257 million during the month of November 2005,compared to exports worth Rs3,040 million handled during the month of October marking a monthly decline of Rs783 million.

Giving details Chairman Sialkot Dry Port Trust Mehboob A. Shaikh told newsmen that the goods exported, include sports goods (worth Rs55 million); leather goods (worth Rs679 million); surgical instruments (worth Rs593 million); cotton products (worth Rs75 million); Nylon products (worth Rs130 million); cutlery products (worth Rs77 million); furniture (worth Rs8.5 million); rice (worth Rs0.50 million); and machinery (worth Rs2 million).

 
 

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