News Updates

Friday, July news 25, 2014 updates

Office # 05, Ground Floor, Arshad Mansion, Near Chowk A.G Office, Nabha Road Lahore. Ph. 042-37350473 Cell # 0300-8848226 NEWS OF Mail to: [email protected], [email protected] THE DAY PLP NEWS ALERTS EMAIL No. 172-2014 NEWS HEADLINES Top Stories ...... 5 Pakistan urges 'humanitarian pause' in Gaza ...... 5 Mourning Day today ...... 6 15 dead as Israeli shell hits school ...... 7 Former CJP seeks Rs 20 billion in damages from Imran ...... 7 PTI says it welcomes legal notice ...... 8 Government working to give India MFN status ...... 9 Saarc urged to develop EDI to resolve teething issues ...... 10 More than 2.2 billion people 'poor or near-poor': UNDP ...... 12 Pakistan ranked at bottom in South Asia ...... 13 Wreckage of missing Algerian airliner found in Mali ...... 13 IMF lowers 2014 global growth forecast ...... 14 LNG import: Ministries reluctant to become members of body ...... 15 Gunmen kill two Finnish women in Herat ...... 16 Iraq elects Kurdish lawmaker as president ...... 17 Reko Diq project: Balochistan government accused of trying to award contract to blacklisted company 18 Setting up credit rating company: Rs 100 million minimum equity proposed by SECP ...... 19 PBS clarification ...... 21 Lahore killings: Sanaullah, Shah to be cross-examined today ...... 22 Ukraine Prime Minister resigns over coalition break-up ...... 22 Equities inch up ...... 23 Business and Economy: Pakistan ...... 24 Reserves decline by $63.4 million ...... 24 PBS clarification ...... 24 13.2 percent of GDP: national saving rate lowest in South Asia ...... 25 Government working to give India MFN status ...... 27 Saarc urged to develop EDI to resolve teething issues ...... 28 Shahbaz for strict implementation of development programme ...... 30 Economic activities: PIAF urges government to ensure participation of women ...... 31 One Stop Shop to be set up at LCCI to facilitate investment ...... 32 CDA directives: Development work in Park Enclave housing scheme soon after Eid ...... 33 Bestway Cement acquires Lafarge Pakistan plant in Chakwal ...... 34 Activities at Karachi and Qasim ports ...... 34

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PLP NEWS ALERTS EMAIL No. 172-2014 Paapam chief pinpoints factors hitting auto industry ...... 36 Yellow cab scheme from October: Punjab chief minister ...... 37 Punjab Metro Bus Authority approves budget: 68 buses to be purchased ...... 38 PIA faux pas! ...... 38 Emirates Airlines resumes operations from Peshawar ...... 40 KP governor inaugurates Khushal Garh Bridge near Kohat ...... 40 Double pension at 75 years of age: Punjab government issues notification...... 41 Cotton and Textiles: Pakistan ...... 42 Lean business on cotton market ahead of Eid holidays ...... 42 Moderate trading ...... 43 Agriculture and Allied: Pakistan ...... 45 Pakistan, France to promote bilateral trade in agriculture sector ...... 45 Daily trading report of PMEX ...... 46 Rice export decreased by 8.44 percent in June ...... 46 'Monsoon rains likely to boost major Kharif crop production' ...... 47 Poultry contributes 40 percent of total meat consumption ...... 48 Exporters still disappointed: record fisheries worth $367.472 million exported in fiscal year 2014 ...... 48 Contamination of Manchhar Lake: Zakat department, BISP to provide funds for relief to fishermen, rehabilitation of lake ...... 49 Taxation: Pakistan ...... 51 Where further tax is included: taxmen told not to entertain output tax claims ...... 51 Retailers' registration with ST department: RTOs to carry out market surveys ...... 51 Fuel and Energy: Pakistan ...... 54 Increase in GIDC to push up prices of daily use items ...... 54 More protests likely after Eid against loadshedding ...... 55 Fuel and Energy: World ...... 56 Brent oil dips below $107, market well-supplied ...... 56 Iraq oil exports dip after jihadist offensive ...... 57 Banking & Finance ...... 58 Pakistan’s liquid foreign reserves reach $14.45 billion...... 58 Markets ...... 59 232 fined during crackdown against profiteering ...... 59 BR Research: All ...... 60 PML-Ns subpar report card ...... 60 Modest(y) returns at FFC ...... 62

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PLP NEWS ALERTS EMAIL No. 172-2014 Pakistans recreational mix ...... 63 Targeting ease of doing business ...... 64 Brief Recordings...... 66 President Sarhad Chamber of Commerce and Industry explains how Pakistan lost Afghan market to Iran ...... 66 Crime Records ...... 69 Attock: 36 suspects held in crackdown ...... 69 9 Afghans held in Quetta ...... 69 Rawalpindi: Man held carrying heroin to Italy ...... 69 Muzaffargarh: Huge quantity of liquor seized ...... 69 Nankana Sahib: 5 held with dead animals’ meat ...... 70 Karachi: 9 shopkeepers arrested; 199 fined ...... 70 Pakpattan: Man booked in fake cheques ...... 70 Daska: Women gang-raped at gunpoint ...... 70 Miscellaneous News ...... 72 National schemes: Savings mobilisation declines 49% in FY14 ...... 72 Tapping hydrocarbons: Oil production hits record high at 98,000 bpd...... 73 Future projection: IMF sees 13% depreciation of Pakistani rupee ...... 74 Bestway buys 76% stake in Lafarge Cement ...... 76 Corporate results: Fauji Fertilizer produces Rs8.2 billion profit ...... 77 Govt to frame four-year energy plan for outages ...... 79 Another mobile paisa facility launched ...... 80 Tax collection: FBR looks to bridge communication gap with business community ...... 81 Automobile corruption: Stop abusing import policies, says PAAPAM ...... 82 Forex: Reserves drop a nominal 0.9% ...... 84 OPEN MARKET FOREX RATES ...... 85 INTER BANK RATES ...... 86 Bullion Rates (Gold Prices) in Pakistan Rupee (PKR) ...... 87 Gold Rates & Silver Rate from major cities of Pakistan ...... 88

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PLP NEWS ALERTS EMAIL No. 172-2014 Top Stories Pakistan urges 'humanitarian pause' in Gaza

July 25, 2014

ALI HUSSAIN

Expressing deep anguish and concern over the humanitarian catastrophe unfolding in Gaza due to relentless Israeli aggression, Pakistan on Thursday called for an unconditional ceasefire and an immediate end to the Gaza blockade. Sharing the government of Pakistan's deep anguish and concern over the aggravating situation in Gaza, Foreign Secretary Aizaz Ahmad Chaudhry told the Foreign Office weekly press briefing that Israeli military offensive has led to the killings of innocent, non-combatant, and unarmed Palestinians, including women and children, in Gaza.

"We are deeply appalled by carnage in Gaza," he said, adding Pakistan has been a firm, consistent and vocal supporter of the Palestinian cause. Ever since Pakistan's independence in 1947, he said our leadership has all along supported the right of the Palestinians to self-determine their destiny and create a Palestinian State. In the present crisis in Gaza, in the wake of Israeli aggression, he pointed out that Pakistan's concern has been voiced at the highest level by the Prime Minister himself who condemned the Israeli aggression and the genocide it is committing and expressed solidarity of the people of Pakistan with their Palestinian brothers.

He said that on Prime Minister's instructions, Pakistan has mobilised international opinion to end the ongoing atrocities in Palestine due to an Israel military offensive. "We have spoken clearly and unambiguously in the United Nations Security Council yesterday and called for an end to hostilities and to revive the peace talks," he said, adding that Pakistan has also called on the Security Council to act by adopting a resolution that would call for an immediate and an unconditional ceasefire, halt Israeli air, ground and naval offensive, and remove Israeli forces from Gaza.

On the humanitarian and human rights aspect, Aizaz said that Pakistan is actively working with Muslim and like-minded countries to secure humanitarian access to those who are badly wounded and stranded in shelters. At the UN Human Rights Council in Geneva, he said Pakistan on behalf of the OIC spearheaded a resolution, which has since been adopted by the Council. "It is important that the blockade of Gaza has ended, its border opened, and the Palestinian prisoners released," he added.

He further said that Pakistan Deputy Speaker of National Assembly Murtaza Javed Abbasi is participating in a conference convened in Iran on the ongoing situation in Gaza. He said that Pakistan's efforts at the diplomatic and international domains, including UN Security Council, UN General Assembly, UN Human Rights Council, the OIC, the NAM, and all other related forum will continue until the ongoing atrocities in Palestine end.

"Pakistan is convinced that violence and bloodshed cannot achieve any solution. For enduring peace, an independent Palestinian State based on pre-1967 borders with Al-Quds Al Sharif as its capital, is the right way to achieve a lasting peace and stability in the Middle East," he said. To a

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PLP NEWS ALERTS EMAIL No. 172-2014 question, he said that most important requirement at this stage is to make Israel end its military offensive, declare an immediate and un-conditional ceasefire and pull out of Gaza. "The blockade of Gaza must end to allow access of humanitarian assistance and that is why even in the UN Security Council and in the UN Human Rights Council, we call for humanitarian pauses," he said.

When asked whether Pakistan is ready to send relief goods to Gaza, he said unless the blockade is lifted, we can't transport relief assistance. "So our first effort at this moment is to mobilise international opinion and exert all efforts in this regard and we are exploring all options to extend political and humanitarian support in consultation with Muslim and like-minded countries and playing Pakistan's due role", he added.

About the OIC role, he stated that there is a lot of activity going on and Pakistan is actively engaged in the efforts. "As soon as we succeed in putting a halt to the Israeli military offensive, the door will be open for collective efforts in terms of humanitarian aid," he added.

Asked about Pakistan's stance after Egypt and Jordan declared Hamas as a terrorist organisation, he said that at this stage it is not the real issue and also this is not the time to worry about differences between the Palestinian ranks. As for intra Palestinian issues, he said, this is something that the Palestinian leadership is fully seized of and the Arab group is helping them.

"We will follow whatever consensus they achieve but at this time this is not the real issue," he said, adding the real issue is that in the Israeli military offensive there must end. He said Pakistan believes that the Palestinian issue must be resolved within the framework of the UN Security Council resolutions including its Resolution 242 and others.

To another query, he said that UN is a very important forum and it is at the UNHRC itself where a resolution was adopted with 29 votes in favour one against and 17 abstentions on Gaza the other day. "We should not underestimate the importance of the role that the UN must play," he said, adding that it is our rightful expectation that UN would play a lead role in this regard. He further said that the forums like the OIC and the NAM should play a role and Pakistan is very active in these efforts. "Whatever the efforts of the international community in whatever forum, Pakistan stands with the Palestinians. We would use every forum to put pressure on Israel to withdraw from Gaza," he added.

July 25, 2014

Prime Minister Nawaz Sharif has announced Friday as a day of mourning to show solidarity with people of Gaza, his office said in a statement here on Thursday. "Moreover, the Prime Minister has ordered to contribute one million dollars in UN flash appeal for Gaza Palestinians," it said.

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PLP NEWS ALERTS EMAIL No. 172-2014 15 dead as Israeli shell hits school

July 25, 2014

Fifteen Palestinians were killed Thursday when an Israeli shell slammed into a UN shelter where hundreds of civilians had taken refuge, sending the death toll in Gaza soaring to 788 despite world efforts to broker a ceasefire. The strike hit a UN school sheltering some of the 100,000 Palestinians driven from their homes in search of a safe haven after weeks of deadly fighting between Israeli troops and Hamas militants.

The shell crashed down in the middle of the courtyard where people had set up camp, leaving the ground covered in bloodstains. Gaza's emergency services said at least 15 people had been killed and more than 200 wounded, sending the Palestinian death toll from 17 days of fighting to 788.

UN chief Ban Ki-Moon said: "Many have been killed - including women and children, as well as UN staff." He said he was "appalled" by the news and "strongly condemned" the attack which he said "underscores the imperative for the killing to stop - and to stop now". Washington said it was "deeply saddened and concerned about the tragic incident", without explicitly blaming its ally Israel for the shelling.

"We again urge all parties to redouble their efforts to protect civilians," State Department spokeswoman Jen Psaki said in Cairo, where Secretary of State John Kerry is trying to negotiate a ceasefire. Kerry reached out to Hamas allies Turkey and Qatar on Thursday as he sought to further regional efforts to broker an end to the bloodshed.

The US diplomat is seeking to garner support for an Egyptian-drafted proposal and an aide said he had spoken to his counterparts in Doha and Ankara in the hope they would use their influence to encourage Hamas to accept the plan. Hamas has rejected the proposal so far, with its exiled leader Khaled Meshaal saying late Wednesday that there could be no halt to the fighting without an end to Israel's eight-year blockade on Gaza first. The Egyptian plan calls for a ceasefire first and talks afterwards on a long-term solution to Gaza's problems.

July 25, 2014

KHUDAYAR MOHLA

Former Chief Justice Iftikhar Muhammad Chaudhry on Thursday served a Rs 20 billion defamation notice to Pakistan Tehreek-i-Insaf chief Imran Khan. Lawyers of the former Chief Justice Chaudhry issued a notice to Imran Khan under Section 8 of the Defamation Ordinance 2002 for allegedly maligning the apex court as well as bringing the former Chief Justice to disrepute.

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PLP NEWS ALERTS EMAIL No. 172-2014

"I claim from you in damages a token sum of Rs 15 billion only and another Rs 5 billion only as damages for mental agony, torture, harassment, humiliation, etc, caused to me as well as my family," Iftikhar Muhammad Chaudhry said in his notice. Serving the notice to Imran Khan from his new residence 222, Street 50, F-10/4, Islamabad, the former Chief Justice said that he reserved the right to initiate other civil and criminal proceedings against Khan both inside and outside the jurisdiction of Pakistan if the PTI chief failed to tender an unconditional apology regarding allegations levelled against him. Chaudhry also expressed, "I may withdraw my claim if you willingly tender an unconditional apology or you agree to pay the damages as quantified hereinabove within a period of 14 days".

July 25, 2014

Pakistan Tehreek-e-Insaf (PTI) on Thursday welcomed a legal notice sent to Imran Khan by former chief justice Iftikhar Muhammad Chaudhary, terming it a good opportunity to expose the nexus between the ex-CJ and ruling Pakistan Muslim League-Nawaz (PML-N). Talking to journalists, PTI central information secretary Dr Shireen Mazari stated that PML-N has finally launched its 'opening batsman' in the shape of former chief justice Iftikhar Chaudhry to hit out at PTI Chairman Imran Khan.

"We welcome this opportunity to expose the nexus between the ex-CJ and the PML-N especially over the rigging of the May 2013 election and the cover-up that followed. This is what derailed democracy. PTI intends to restore and strengthen democracy by exposing this planned mass rigging on August 14 through its Azadi March," she maintained. Mazari said the PTI had yet to receive the legal notice purportedly sent to its chairman, but she made it clear that there was no way PTI and its chairman would back down. She asserted that PTI has proof not only of the ex- CJ's "complicity" in the rigging and cover-up that followed but also the "nepotism" he indulged in using his office to promote his son beginning with his recruitment in the FIA.

She claimed that PTI has also got documentary evidence of his son's alleged corruption, adding all this will be put before the nation on 14 August - the day PTI wants to hold a 'million march' on Islamabad. Mazari pointed out that the PML-N is getting unnerved by the minute as its lack of an electoral mandate is nearing a complete expose, adding "that is why it is using all its team players to target Imran Khan but none of these attacks will stop PTI from its commitment to exposing of rigging, PML-N corruption and the derailment of democracy as the Sharifs' convert Pakistan into a quasi-monarchy." She also stated that it is shameful how low the PML-N can stoop to try and target the Chairman PTI. In this connection, she said the Speaker National Assembly accepting the Senate's motion against Imran Khan was a clear conflict of interest and could also be taken as a breach of privilege of a MNA.

"The Speaker had also lost all moral authority after rigging was exposed in his NA 122 constituency when 6 polling stations in PP 147 under his NA constituency, opened for vote verification revealed a massive fraud including casting of bogus votes", she added. Mazari said that such tactics by the PML-N and "their partner the ex-CJ" only bolstered the belief, not only

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PLP NEWS ALERTS EMAIL No. 172-2014 within the PTI but also across the nation, that the PMLN was guilty of stealing the electoral mandate through rigging. She further stated that such PML-N shenanigans only bolster PTI's resolve to reclaim democracy and justice for Pakistan and its people - who came out to vote for a strong democracy not a quasi-monarchy.

July 25, 2014

Pakistan on Thursday said it would re-start work on improving trade ties with arch-rival India when the two nations' foreign ministers meet in Islamabad next month. Pakistan had pledged to grant India "Most Favoured Nation (MFN)" status by the end of 2012, meaning Indian exports would be treated the same as those from other nations, but so far has not done so.

India granted Pakistan MFN status in 1999. "When the dialogue process resumes, we hope to build on the work already done in this regard," top foreign ministry bureaucrat Aizaz Ahmad Chaudhry told AFP at a weekly press briefing. The foreign secretaries of Pakistan and India are set to meet in Islamabad on August 25 in the neighbouring countries' latest attempt at improving ties. The proposed meeting, announced by Pakistan's foreign office on Wednesday, comes after Prime Minister Nawaz Sharif held talks with his Indian counterpart Narendra Modi in New Delhi following the Hindu hard-liner's inauguration in May. Chaudhry said there were number of issues on both sides for normalising bilateral trade which included "making sure that vulnerable sectors are protected and the issue of the non-tariff barriers in India and the issue of imbalance of trade and certain other infrastructure-related issue."

MFN status will mean India can export 6,800 items to Pakistan, up from around 2,000 at present, and the countries aim to lift bilateral trade to $6 billion within three years, officials have said. Trade between the two countries is presently around $2.5 billion, with Indian exports accounting for $1.75 billion, according to the Karachi Chamber of Commerce and Industry.

A further $3 billion is thought to be channelled through Dubai, almost all of it in Pakistani imports, though the business community believes that if Pakistan grants India MFN status the imbalance could change. India and Pakistan have directed their peace efforts towards "trade diplomacy" in a bid to build enough trust to tackle thornier issues that divide them, such as Kashmir.

Bilateral relations broke down after attacks by Pakistani gunmen on India's commercial hub Mumbai in 2008, in which 166 people were killed, though relations have recovered slightly since then. India in August 2012 lifted a ban on foreign investment from Pakistan except in defence, space and atomic energy in a step designed to build goodwill amid the renewed push for a peace settlement.

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PLP NEWS ALERTS EMAIL No. 172-2014 Saarc urged to develop EDI to resolve teething issues

July 25, 2014

MUSHTAQ GHUMMAN

Pakistan has underscored the need for developing an Electronic Data Interchange (EDI) to resolve teething issues amongst the Saarc member countries. This proposal was floated by Commerce Minister Engineer Khurram Dastgir in his address at the 8th South Asian Free Agreement (SAFTA) Ministerial Council meeting being held in Thimpu (Bhutan).

During deliberations, the Commerce Minister emphasised the importance of connectivity; specifically land-ports and energy-grids within the Saarc region. Pakistan also supported India's proposals to establish a Saarc Development Bank and currency swap agreements which would further the cause of regional connectivity and integration. "Let us have the courage to open hearts and our markets to each other," reported said Commerce Minister who is making all out efforts to convince domestic stakeholders to allow the government to forge good trade relations with India if the latter accepts Pakistan's demands. Analysts believe as Foreign Secretaries of India and Pakistan are meeting in the forth week of August in Islamabad to carry forward the dialogue process, which implies that trade ties will be on top of the agenda of both the top diplomats.

"Commerce Minister who was isolated in fighting for improvement in trade ties with India will be more than happy to see Foreign Secretaries of both countries discuss trade along with other key issues," commented an official on condition of anonymity. Addressing the SAFTA Ministerial Council, Commerce Minister said in the present scenario of persistent global slow growth, it is imperative that SAFTA member states keep their markets open and keep widening the opening to ensure that the region keeps moving towards the goal of development. He reiterated Pakistan's assurance of enhanced access to Least Developed Countries (LDCs) within SAFTA, to keep its market open for trade and deepen Pakistan's integration into the regional economy and to provide all SAFTA partners a non-discriminatory market access on a reciprocal basis. He, however, urged other Saarc countries to take measures to encourage regional trade.

Dastgir further stated that Saarc region should continue to create a business-friendly environment that helps businesses to succeed. However, in motivating SAARC business communities to venture in the region, the member countries need to ensure that they are provided a conducive environment and a level-playing field. He maintained that since assuming his office last June, Prime Minister Nawaz Sharif has made enhancing trade and connectivity in the region the cornerstone of his government's policymaking. Poor infrastructure and intra-SAARC connectivity remain a paramount issue which the member countries need to overcome in order to ensure that SAFTA realises its true potential.

He said Pakistan has embarked upon strenuous efforts to address infrastructure inadequacies as a matter of high priority. "We believe that in order to improve regional trade ties, we need to build trade and economic corridors with our neighbours by linking our highways, sea and land ports and airport facilities," he continued Keeping in view the significance of land ports in regional

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PLP NEWS ALERTS EMAIL No. 172-2014 connectivity, Pakistan by the end of this year would be establishing Land Ports Authority (LPA) with the objective of effectively and efficiently managing and supervising land ports thus ensuring better facilities to exporters, importers and trade with neighbouring countries, he further added.

The infrastructure facilities at Torkhum, Chaman and Wagha land ports would be further improved keeping in view their role in promotion of regional trade and investment particularly with Afghanistan and India. "We also intend to explore the possibility of enhancing direct shipping routes to India, Bangladesh, Sri Lanka and Maldives. The possibilities of reaching out to land-locked Nepal and Bhutan are also under study," he stated.

Commerce Minister stated that as members of a developing region, SAARC countries face the common problem of capacity constraints at borders, which causes delays in customs clearance and port procedures. Such constraints undermine the competitiveness of business community. He said trade facilitation is one of the key areas where all member countries need to make collective progress. Commenting on agriculture, Commerce Minister stated that all the Saarc countries need not take such measures which create an element of trade distortion.

With the deeper integration of the region through the Saarc agreement of Trade in Services (SATIS), Pakistan believes that the region would be more competitive and lead to a more conducive environment for businesses to operate and flourish in. The implementation of SATIS will hence broaden and deepen the current linkages and engagement amongst members. Pakistan looks forward to the deeper ties and boost to trade and investment that this agreement will bring to the region, he stated. Pakistan sees this agreement as a complementary and contributory vehicle towards SAFTA, which can be a game-changer for regional economic integration, Dastgir further stated.

He maintained that SAARC countries need to pursue the objective of regional economic integration and develop regional value chains so as to strengthen member countries in the global trade game. Although, a visible progress has been made, much remains to be done.

He highlighted the following areas of concern: (i) SAARC countries must reduce non-tariff barriers to trade as, so far, discussions on NTBs/NTMs are inconclusive. It is high time that the regional bloc introduces certain timelines wherein reported NTBs/NTMs issues could be resolved amongst SAFTA countries, perhaps on the pattern of TLP negotiations; (ii) SAARC needs to streamline customs procedures and more business-friendly administrative processes. The progress of sub-group on Customs co-operation has been commendable and the region now needs to move forward on developing SAARC EDI (Electronic Data Interchange) which would likely resolve many teething issues; (iii) establishment of the South Asian Regional Standards Organisation (SARSO) and signing of the agreements on Multilateral Arrangement on Recognition of Conformity Assessment and the agreement on Implementation of Regional Standards would prove as significant steps to harmonise standards, procedures and certifications. However, it is desirable that all unnecessary regulatory burdens including administrative processes are simplified; (iv) Saarc may need to revisit SAFTA rules of origin and related administrative procedures. The Asian Development Bank report on regional economic integration makes some important recommendations in this regard and SMC being the apex policy making body of SAFTA may direct the Committee of Experts (CoEs) to engage in discussion and come up with a solid set of recommendations; and (v) the regional bloc needs to strengthen the institutional basis of Saarc on the pattern of ASEAN. The member countries may

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PLP NEWS ALERTS EMAIL No. 172-2014 look into the possibility of a strong regional trade promotion team which could propose measures to boost intra-SAARC trade in close co-ordination with Saarc Chamber of Commerce and other leading trade bodies/associations of the region. He stated that Pakistan will continue to be a staunch advocate of free trade and appropriate vehicles that can further this agenda. A free and open regional economy is an important part of Pakistan's growth, he concluded.

July 25, 2014

More than 2.2 billion people are "poor or near-poor", with financial crises, natural disasters, soaring food prices and violent conflicts threatening to exacerbate the problem, a United Nations report said Thursday. While poverty is in decline world-wide, growing inequality and "structural vulnerabilities" remain a serious threat, said the report by the United Nations Development Programme (UNDP), released in Tokyo.

Nearly 1.5 billion people in 91 developing states live in poverty while another 800 million are teetering on the edge, it found. "Eliminating extreme poverty is not just about 'getting to zero'; it is also about staying there," said the agency's 2014 Human Development Report. "Those most vulnerable to natural disasters, climate change and financial setbacks must be specifically empowered and protected. "Making vulnerability reduction central in future development agendas is the only way to ensure that progress is resilient and sustainable," it added.

UNDP chief Helen Clark said this was the first time that the annual study looked at vulnerability and resilience jointly "through a human development lens". "If life-cycle and structural vulnerability are addressed, and conscious efforts are made to lift resilience to crisis and disaster, then I have no doubt that many of the kind of setbacks we see today to human development can be averted in future," Clark said at an event for the report's release.

The study, entitled "Sustaining Human Progress: Reducing Vulnerabilities and Building Resilience", called for making basic social services available to all and putting full employment at the top of the development agenda. "Providing basic social security benefits to the world's poor would cost less than two percent of global GDP (gross domestic product)," it said. "A basic social protection package is affordable so long as low-income countries reallocate funds and raise domestic resources, coupled with support by the international donor community."

About 1.2 billion people survive on the equivalent of $1.25 or less per day, the UNDP said. "If you are poor, you are less able to handle several shocks; you may also be disabled, you may also be older. So you have more layers of things against you," Khalid Malik, the report's lead author, told reporters ahead of its release on Thursday. Key to dealing with the problem was focusing government policy on jobs and social safety nets, the study said.

"Structural vulnerabilities are often manifested through deep inequalities and widespread poverty," it said. "The poor, women, minorities (ethnic, linguistic, religious, migrant, or sexual),

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PLP NEWS ALERTS EMAIL No. 172-2014 indigenous peoples, people in rural or remote areas or living with disabilities, and countries landlocked or with limited natural resources tend to face higher barriers.

July 25, 2014

Pakistan retained its last year's position at number 146 in the category of 'low development countries' in the UN Human Development Report (HDR) 2014 'Sustaining Human Progress: Reducing Vulnerabilities and Enhancing Resilience' released at the UN University Headquarters here on Thursday. The country's human development index (HDI), a measure derived from life expectancy, education levels and incomes, did not grow when compared with 2013.

Pakistan, an atomic power and population of around 180 million, is thus ranked at bottom in the South Asian region as even small countries like Bhutan, Sri Lanka, Bangladesh and Nepal are ahead of it in human development. India is ranked at 135, among the 'medium development' countries like Egypt, South Africa, Mongolia, Philippines and Indonesia. Among other South Asian countries Bhutan and Bangladesh too figure in this category. Pakistan (ranked 146) and Nepal (145) are in the 'low development' category, while Sri Lanka (73) is in the 'high development' category.

The HDR covers 187 countries across the world and is published annually by the United Nations Development Programme (UNDP). In the current report, the top five countries ranked in terms of the HDI are Norway, Australia, Switzerland, Netherlands and the US. The bottom five present in this ranking are Niger, Democratic Republic of Congo, Central African Republic, Chad and Sierra Leone.

July 25, 2014

The wreckage of an Air Algerie plane missing since early Thursday with 116 people on board has been found in Mali near the Burkina Faso border, an army co-ordinator in Ouagadougou said. "We have found the Algerian plane. The wreck has been located ... 50 kilometres (30 miles) north of the Burkina Faso border" in the Malian region of Gossi, said General Gilbert Diendiere of the Burkina Faso army.

A witness had earlier reported seeing the plane "falling" in the region of Gossi and the general said they were taking the reports seriously as they matched radar images of the flight path. "That is where we will strengthen our search," he had added. Flight AH5017, which originated in

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PLP NEWS ALERTS EMAIL No. 172-2014 Ouagadougou and was bound for Algiers with 51 French nationals aboard, according to Foreign Minister Laurent Fabius, went missing amid reports of heavy storms, company sources and officials said.

It had been presumed to have been lost even before Fench President Francois Hollande went on TV to announce: "Everything leads us to believe that the plane has crashed." He said the plane's Spanish crew had signalled they were altering course "due to particularly difficult weather conditions". Algerian Prime Minister Abdelmalek Sellal was earlier cited as saying by Algerian radio that the plane dropped off the radar at Gao, 500 kilometres (300 miles) from the Algerian border.

"Contact was lost with the McDonnell Douglas 83 at 1:47, a little after the pilots said they were diverting from the route due to meteorological reasons," Fabius had said. The airline said it also had 24 Burkinabe, eight Lebanese, six Algerians, six Spanish, five Canadians, four Germans and two Luxembourg nationals on board.

Poor visibility - Mali, Algeria, Niger and France co-ordinated their search efforts under the umbrella of the French-led military intervention in Mali, Operation Serval. "Even though the aircraft was above Mali it was in airspace managed by the control centre in Niamey in Niger," an air traffic control official told AFP.

July 25, 2014

The IMF lowered its 2014 global economic growth forecast Thursday, warning of "negative surprises" from the United States and China and geopolitical risks in Ukraine and the Middle East. The International Monetary Fund projected global growth of 3.4 percent for this year, down from its April estimate of 3.7 percent. In 2013, the world economy grew 3.2 percent.

The downgraded 2014 growth outlook reflects "both the legacy of the weak first quarter, particularly in the United States, and a less optimistic outlook for several emerging markets," the IMF said, in an update of its semi-annual World Economic Outlook. The US economy, which accounts for nearly a quarter of the world's gross domestic product, shrunk by 2.9 percent in the first quarter, in part because of severe winter weather.

On Wednesday, the IMF lowered its 2014 US growth forecast to a "disappointing" 1.7 percent, from 2.0 percent in mid-June and 2.8 percent in April. "It's really a story of something which has just happened and that is behind us," said Olivier Blanchard, the IMF's chief economist.

The IMF is projecting growth will pick up in the US the rest of the year, but not enough to offset the first-quarter drag. China, the world's second-largest economy, will expand less than previously thought, the IMF said, lowering its forecast to 7.4 percent from 7.6 percent. "In China, domestic demand moderated more than expected," it said. In the eurozone, still struggling to recover from recession, the growth estimate was unchanged at 1.1 percent, and the IMF reiterated concern about weak inflation in the 18-nation European bloc.

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PLP NEWS ALERTS EMAIL No. 172-2014

"In major advanced economies, there is a risk of stagnation in the medium term," the IMF warned. The brief update showed the IMF increasingly concerned by escalating geopolitical tensions. "Geopolitical risks have risen relative to April: risks of an oil price spike are higher due to recent developments in the Middle East while those related to Ukraine are still present," the report said. Russia, the target of recent US and European Union economic sanctions for its alleged support of separatist fighting in Ukraine, was likely to see its economy brought to the brink of recession this year.

IMF slashed its Russian growth forecast by 1.1 percentage point, to 0.2 percent, saying "activity in Russia decelerated sharply as geopolitical tensions further weakened demand." Emerging- market economies would slow a bit more than previously estimated, to a 4.6 percent growth pace, but they were not expected to suffer significantly from the eventual US exit from extremely loose monetary policy.

"Emerging market economies - particularly those with domestic weaknesses and external vulnerabilities - may face a sudden worsening of financial conditions and a reversal in capital flows in the event of a shift in financial market sentiment," the IMF said. Such a scenario occurred in 2013 when investors abruptly withdrew capital from emerging-market economies anticipating the Federal Reserve would raise its key US interest rate, stuck near zero since late 2008. That did not happen, but the Fed is looking to hike the federal funds rate in mid-2015. "I don't think we'll see major financial chaos in the future... but there are going to be bumps,"Blanchard said. Despite the worse-than-expected global growth outlook for 2014, the IMF left its 2015 forecast unchanged at an annual rate of 4.0 percent, the fastest pace since 2011.

July 25, 2014

Ministry of Finance, Ministry of Water and Power and Law Division are hesitant to become members of the committee proposed by Ministry of Petroleum and Natural Resources to negotiate price with Qatargas for import of LNG, it was learnt.

Sources said that Ministry of Petroleum has solicited comments of Ministries and Divisions to its proposal that a nine-member committee may be constituted to negotiate the LNG price and other important issues with Qatargas before putting up a summary in this regard to the Economic Co- ordination Committee (ECC) of the Cabinet. A summary submitted to the ECC after the approval of Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi was not taken up and deferred.

Ministry of Water and Power argued that it is not a relevant ministry because LNG is an oil and gas subject and may therefore be omitted after consultation with stakeholders. Water and Power Ministry further proposed that a member from Oil and Gas Regulatory Authority (Ogra) may be an alternative option. However, Ministry of Petroleum stated that inclusion of regulator (Ogra) in

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PLP NEWS ALERTS EMAIL No. 172-2014 the committee is not supported because of government to government negotiation. It further added that LNG would be mainly allocated to power sector and therefore a member from Ministry of Water and Power was included in the committee due to its pivotal role. Finance Division has raised objection to the nine member committee proposed by the Ministry of Petroleum to negotiate LNG import price with Qatargas. "The composition of the price negotiation committee with nine members is too large to serve as a tight co-ordinated team," stated Finance Division adding that some of the nominees like Chairman, Board of Investment (BOI), Secretary Law, Secretary Water & Power, Managing Director Inter-Service Gas Supply Limited (ISGSL) and Secretary Finance are not directly related to the matter of pricing of LNG as the basic role in LNG price negotiation committee would be played by Ministry of Petroleum and Natural Resources and Pakistan State Oil (PSO), being the processing agency. The Sui Northern Gas Pipeline Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL) are also relevant to the extent that these would be the recipient of LNG from PSO and have technical skills. Therefore, it is proposed that Ministry of Petroleum may rationalise the proposed composition of the committee to an optimal size to serve as a well co-ordinated negotiation team".

Finance Division further suggested that Petroleum Ministry may define Terms of Reference (TOR) of price negotiation committee as well as clear parameters of price negotiation. Further, Petroleum Ministry may consider constituting a technical committee of sector experts to study various pricing models currently being used in the LNG market globally. Law Division has also shown unwillingness to be part of the price negotiation committee and stated that "as regards membership of the price negotiating committee, this Division reckons that at this stage, participation of the Law Secretary and his nominee is not required. The sponsoring Ministry, may, however, seek legal opinion of this Division, as and when required."

July 25, 2014

Two Finnish female aid workers were shot dead by unidentified gunmen while travelling in a taxi in western Afghanistan on Thursday, officials said, the latest killings in a recent spate of attacks on foreigners. It came as Afghanistan undertakes a massive audit of its recently concluded presidential vote to avert an impasse threatening to plunge the country into an ethnic conflict as foreign troops prepare to depart after more than a decade of war.

No group has yet claimed responsibility for the killings in Herat city, but the Christian medical charity the women worked for was targeted by the Taliban four years ago in an attack that killed eight foreigners. The militants claimed at the time the medics were "missionaries".

Sayed Fazullah Wahidy, governor of Herat province, told AFP: "This morning at around 11:30am (0700 GMT) gunmen on a motorcycle opened fire at two foreigners riding in a taxi and killed them." Interior ministry spokesman Sediq Sediqqi confirmed the attack and said the perpetrators had escaped. "One person was detained at the scene but the two gunmen escaped and the police are searching the area," he said. Finland's president Sauli Niinisto later condemned the "barbaric" shootings.

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PLP NEWS ALERTS EMAIL No. 172-2014

"The Finnish women's barbaric fate touches us all. The act is particularly shocking because the women were in Afghanistan to help the local population," he said. "The murderer or murderers must be held accountable for their actions. I call on the Afghan authorities to make every effort to identify the perpetrators are caught and brought to justice," he continued. The International Assistance Mission, a Christian medical charity said the victims were their employees. "With deep sadness we confirm that today... two Finnish expatriate female staff members of IAM have been killed in Herat," said a statement signed by the group's acting executive director Heini Makila.

Foreigners targeted - Foreigners have increasingly become victims of violence in recent months raising questions over whether it is a new Taliban tactic, a series of random incidents or rising xenophobia.

July 25, 2014

Iraq's parliament elected a senior Kurdish lawmaker president on Thursday, a significant step in a delayed process to create a government capable of uniting the country and countering insurgents threatenening to march on Baghdad. Visiting UN Secretary-General Ban Ki-moon said Iraq's very survival as a nation was at risk and told politicians to drop ethnic and sectarian differences and form an inclusive government to combat the nation's "existential threat".

Iraq's politicians have been in deadlock over forming a new government since an election in April. The next step, choosing a prime minister, may prove far more difficult. Shia Prime Minister Nuri al-Maliki has ruled since the election in a caretaker capacity, defying demands from minority Sunnis and Kurds that he step aside for a less divisive figure. Even some fellow Shias oppose his bid for a third term.

Critics say Maliki has stirred up sectarian tensions that have worsened since the Sunni insurgent group Islamic State swept through north and west Iraq last month, seizing large swathes of territory and declaring a "caliphate". "Iraq is facing an existential threat but it can be overcome through the formation of a thoroughly inclusive government - a government that can address the concerns of all communities, including security, political, social and economic matters," Ban told a news conference with Maliki in Baghdad.

The UN chief went from the capital to the holy Shia city of Najaf to meet Iraq's top cleric. Grand Ayatollah Ali al-Sistani has assumed his most active role in politics in a decade, demanding a new government be formed without delay. The 83-year-old's renewed activism could hasten the end of Maliki's political ambitions.

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PLP NEWS ALERTS EMAIL No. 172-2014 Reko Diq project: Balochistan government accused of trying to award contract to blacklisted company

July 25, 2014

ZAHEER ABBASI & ZULFIQAR AHMAD

Balochistan government led by a nationalist party has been accused of trying to award Reko Diq goldmine exploration project to a blacklisted company which is now said to be operating under a different name. Hafiz Hamudullah, a senator of Jamiat Ulem-e-Islam-Fazal from Balochistan, made this accusation and added that he had already drawn the attention of the Upper House of Parliament to the issue by moving a motion that some responsible people of the provincial government have held a secret meeting with the company representatives in London.

The JUI-F senator also claimed that the situation of militancy in Balochistan is as bad as during the tenures of previous governments. He said that nationalist political parties are intentionally not focusing on murders and other crimes taking place in the province as their party is in power now.

"There has been no improvement in the law and order situation and the only difference post 2013 general elections is that the nationalists are not vigorously highlighting issues because they are in the government now and the local media is supporting them," he alleged.

According to him, Aghaz-e-Haqooq-e-Balochsitan Package (AHBP) implementation was not more than five percent and that was also largely on the fiscal side whereas nothing has been implemented on the administrative side. The AHBP was no solution to a crisis-riddled province as the problem was much broader and there is a need to find a political solution to the problem by taking onboard all stakeholders, he added.

He said there has been no visible improvement in corruption and the incompetence of the incumbent provincial government is evident from the fact that all the development funds allocated in 2013-14 have lapsed. The Supreme Court of Pakistan had ruled against Canada's Barrick Gold Corp and Chile's Antofagasta Plc in a long-running dispute with a provincial government of Balochistan over their right to develop a $3.3 billion copper-gold deposit.

The apex court had ruled the agreement of Tethyan Copper Co joint venture to develop the Reko Diq mine in Balochistan invalid. The province of Balochistan originally signed a deal in 1993 to develop Reko Diq with Australia's BHP, now BHP Billiton Ltd. Antofagasta and Barrick spent $200 million to take over the project in 2006 but the Balochistan government had refused to convert the exploration permit into a mining license. However, the ruling National Party outrightly rejected the allegations levelled by Hamudullah. Rehmat Ali Baloch, a senior leader of National Party told Business Recorder over the phone from Quetta that with almost 99 percent writ of the government has been established in the province and normalcy largely restored.

"These people who are criticising us used to travel along with 10 security guards and now they are roaming without any guard, which reflects a significant improvement in law and order

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PLP NEWS ALERTS EMAIL No. 172-2014 situation," he maintained. He said that all previous governments' ministers - from General Pervez Musharraf era to 2013 - used to stay in Islamabad due to security threats rarely visiting Balochistan and leaving the province at the mercy of militant groups instead of finding a solution to the problem.

"All our ministers are working round the clock with full dedication. The chief minister [Dr Abdul Malik] is working for about 17-18 hours per day. He meets about 1500-2000 people on daily basis to know their problems and issues directives on the spot...this is what we're doing instead of staying in Balochistan House," he stated.

In the past deputy commissioners, assistant commissioners, school headmasters and other top government officials were hardly seen in their offices as they were victims to lawlessness. He added: "Now all the government officers are performing their duties without any fear. The schools are open and the students are going to schools...this is what we've done."

About the awarding of a goldmine exploration contact to Tethiyan, he said these were mere allegations and no underhand negotiations were under way with the company. The provincial government has formed a committee which is looking into the matter and all the agreements will be inked in a transparent manner, he added. "Our policy is very clear and that's utilisation of the natural resources in a judicious manner for the uplift of the province. We have never done anything against the decision of the apex court and no company will be allowed to flout the rules in future," he maintained.

July 25, 2014

SOHAIL SARFRAZ

For setting up a Credit Rating Company (CRA) in Pakistan, minimum equity requirement for registration has been proposed to be fixed at Rs 100 million by the Securities and Exchange Commission of Pakistan (SECP). The SECP has proposed amendments to the existing Credit Rating Companies Rules, 1995 through 642(I) 2014 issued here on Thursday to elicit public opinion.

The Securities and Exchange Commission of Pakistan (SECP) would also be empowered to cancel registration of the credit rating agencies in cases where such CRAs are violating Code of Conduct, found guilty of fraud or cause of suspension has not been removed within 120 days from the receipt of the suspension order by the agency.

Under the draft rules, the commission may, after providing a reasonable opportunity of representation to the credit rating company, cancel the registration of a credit rating company if, in the opinion of the Commission the credit rating company has been in violation of these Rules or the Code of Conduct or restriction imposed; it is found guilty of fraud or its registration has

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PLP NEWS ALERTS EMAIL No. 172-2014 been suspended and the cause of suspension has not been removed within 120 days from the receipt of the suspension order or such earlier period as provided through the order of suspension.

The registration of a credit rating company shall stand automatically cancelled if such credit rating company, voluntarily surrenders its certificate of registration to the Commission; or declared insolvent by a court; or stopped business voluntarily or by an order passed by a Court.

Upon cancellation of registration, the credit rating company shall with immediate effect cease to carry out any new rating activity and transfer all necessary record including but not limited to documents, reports connected with its rating activities which may be in its custody or control in accordance with such directions as the Commission may specify. The Commission while cancelling the registration of a credit rating company may impose such conditions as it deems appropriate.

The SECP further said that where a credit rating company contravenes or fails to comply with any provision of these Rules or fails to fulfil its obligations under the Code of Conduct or is not in compliance with conditions of registration or any directive, circular or order issued by the Commission, the Commission, after providing a reasonable opportunity of representation to the credit rating company may, restrict its activities as credit rating company; suspend its registration; and impose a penalty to the extent and in the laid down manner. Where the Commission is satisfied that a delay in suspension of registration of the credit rating company is detrimental to the interest of investors or the capital market or the public in general, the Commission may immediately suspend the registration of the credit rating company till the time an opportunity of hearing is provided to the credit rating company and a final order is passed.

Provided that where the Commission suspends the registration under this sub-rule, the opportunity of hearing and final order must be passed within ninety days from the date of such suspension order. A credit rating company whose registration is suspended shall not undertake any new rating activity or assignment during the period of suspension and remove the cause of suspension within a period of one hundred and twenty days from the receipt of the suspension order or such earlier period as provided through the order of suspension. The Commission while suspending the registration of a credit rating company may impose such conditions as it deems appropriate.

As per rules, every credit rating company shall comply with the Code of Conduct for the credit rating companies issued and amended from time to time by the Commission. The Commission may, if it is satisfied that it is necessary or expedient so to do in the public interest or in the interest of the capital market, by order in writing, give direction, or issue code or circulars, to a credit rating company.

The SECP said that no person shall provide the services of credit rating unless it is registered with the Commission as a credit rating company under these rules. Under the rules, the Commission may allow exit of the international credit rating institution after the completion of five years of such collaboration, if it deems that technical expertise have been transferred and retained by the domestic credit rating company. Explanation:- For the purpose of this clause, the internationally recognized credit rating institutions mean the foreign credit rating agencies specified by the Commission from time to time as internationally recognized credit rating institutions.

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PLP NEWS ALERTS EMAIL No. 172-2014

The draft rules have also redefined the process of credit rating. Under the new rules, the "credit rating" is a process of evaluating credit worthiness of an individual or company which expresses its ability and willingness to meet financial obligations in full and on time.

Under the procedure where registration is not granted or renewed, the Commission may, after providing a reasonable opportunity of hearing to the applicant, refuse to grant or renew the registration if in the opinion of the Commission such applicant does not fulfil the requirements prescribed in these Rules or where the Commission after taking into account the facts, is of the view that it is not in the public interest or in the interest of the capital market to grant or renew such registration.

The applicant, if aggrieved by the decision of the Commission, within a period of thirty days from the date of receipt of such refusal apply to the Commission for review of its decision in addition to right of appeal. On receipt of the application made under sub-rule (2), the Commission may review its decision and communicate its findings, in writing, to the applicant within sixty days.

July 25, 2014

Apropos a news item "Controversy over growth figures: situation underscores need for granting greater autonomy to PBS: analysts" carried by Business Recorder on 2nd July, 2014, the Pakistan Bureau of Statistics (PBS) has clarified that "annual estimates of GDP for the years 2011-12 (Final), 2012-13 (Revised) and 2013-14 (Provisional) were approved by the National Accounts Committee (NAC) Meeting held on 15th May, 2014 purely on the basis of data available upto that point of time and not in accordance with the desires of any one in the government hierarchy. This is the system which is in vogue since long. The data for the balance of the year is projected according to methods and procedures already in practice.

"In this system the data are presented to the NAC members. These are the experts of their subjects and data producers for the relevant sectors as well.The discussion is sector by sector and year by year. "They review and authenticate their input. After thorough discussion the Chairman of the committee approves the estimates. No other department has such forum and such a versatile data to measure the performance of the whole economy. The composition of the committee has no link to the change of government; it is an institutional framework.

"The international agencies and forums refer to the released figures in their future planning/ discussions. The estimates of other forums are treated as superfluous and never adopted in any serious discussions. "The estimates of PBS are based on consistent methods and sources. The other forums can adopt any data and source which suits to their perceptions while PBS does not have this luxury. We are responsible to the nation. The author has quoted GDP growth rates of 3.3 to 3.5 percent based on perceptions, models and methods which are not consistent with the approved methods and sources. The working of PBS is according to the International Standards. Recently, the IMF has thoroughly discussed the annual as well as quarterly procedures, which

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PLP NEWS ALERTS EMAIL No. 172-2014 are being observed by PBS and showed its satisfaction.

"It is clarified that PBS, being an autonomous body after the enactment of General Statistics Act 2011, is working according to the mandate of the act. The act provides the guide lines for the setup. The Governing Council under the Chairmanship of the Finance Minister takes the policy decisions and has no role in the routine matters of the PBS. Functional autonomy is being enjoyed by PBS in its working. "The act provides the guidelines for the setup. The governing council under the chairmanship of the Finance Minister takes the policy decisions and has no role in the routine matters of the PBS. The functional autonomy is being enjoyed by PBS in its working," the clarification concludes.

July 25, 2014

A tribunal holding an inquiry into the Lahore killings directed Chief Minister Punjab Shahbaz Sharif to submit an affidavit till July 25. The tribunal headed by Justice Ali Bakar Najfi also called former law minister Rana Sanaullah and principal secretary to Chief Minister Punjab Dr Toqeer Shah for their cross examination on July 25.

Earlier, former DIG Operations, Lahore Rana Abdul Jabbar, then SP Head Quarter, Lahore, Mahroof Safdar Wahla, then SP Operations Malik Awais Saddar and other police officials were cross-examined. The judge directed the remaining injured police officials to appear before the tribunal on July 25 at 11:30am. The Convenor Joint Investigation Team (JIT) also moved an application for the provision of written statements of injured persons admitted to Jinnah Hospital, Lahore. The statements of the injured witnesses have been recorded by the Commission appointed by this Tribunal.

July 25, 2014

Ukraine's Prime Minister Arseniy Yatsenyuk on Thursday resigned in a shock move in protest at the disbanding of the ruling parliamentary coalition, plunging the strife-torn nation into political uncertainty. "I announce my resignation in connection with the dissolution of the parliamentary coalition and the blocking of government initiatives," a furious Yatsenyuk told parliament.

Yatsenyuk said the "government and the prime minister must resign" after the withdrawal of

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PLP NEWS ALERTS EMAIL No. 172-2014 several parties triggered the break up of the European Choice parliamentary majority in a move that paved the way for long-awaited early legislative elections.

July 25, 2014

The Karachi share market remained firm on Thursday supported by higher trades ahead of Eid holidays. The benchmark KSE-100 index inched up by 9.32 points to close at 30,474.75 points. Ahsan Mehanti, an analyst at Arif Habib Corporation, said socks closed flat amid higher trades ahead of holidays this weekend. Sentiments remained positive on major earnings due after Eid- ul-Fitr.

Bestway Cement 76 percent acquisition of Lafarge Cement, rising textile sector exports data following EU grant on GSP Plus status and speculations in oil sector in corporate earnings season played a catalyst role in the bullish sentiment at KSE despite below expected earnings of Fauji Fertilizer on low urea sales announced today impacting the sector outlook, he maintained. During the intra-day trading, the index reached 30,638.57 points highest and 30,394.30 points lowest level. Following a bullish trend, volume at the ready counter moved up to 218.186 million shares compared to 131.080 million shares Wednesday. Market capitalisation climbed by Rs 17 billion to Rs 7.153 trillion against Rs 7.136 trillion a day earlier.

Trading took place in 326 companies, of which 116 closed in green zone, 188 in red while 22 landed in blue zone. Rabab Khan, an analyst at Aba Ali Habib Securities, said the local bourse witnessed mixed sentiments over the day. Most of the investors were cautious due to long holidays. While trading activity was witnessed in cement on the deal of Lafarge by Bestway Group.

Profit-taking was followed by low performance on the stocks. Construction and materials were followed by commercial banks and chemical increasing by 9 percent and 6 percent, respectively, she added. Among top 10 volume leaders, 4 companies recorded a positive trend, 5 recorded negative trend and one remained unchanged. Lafarge Pak emerged volume leader with 58.68 million shares, up Re 0.21 to close at Rs 16.73. Maple Leaf Cement stood second, up Rs 1.24 to close at Rs 32.14 on 32.24 million shares. Fauji Cement lost Re 0.1 to close at Rs 20.85 on 14.48 million shares.

D.G.K. Cement shed Re 0.43 to close at Rs 88.78 on 12.60 million shares. With 6.21 million shares, B.O.Punjab remained unchanged to close at Rs 9.18. K-Electric Ltd fell by Re 0.16 to close at Rs 7.31 on 5.58 million shares. Cherat Cement gained Rs 3.2 to close at Rs 88.49 on 5.24 million shares Pak Int. Bulk dropped by Re 0.58 to close at Rs 24.77 on 4.24 million shares. With a trading volume of 3.62 million shares, Lucky Cement closed at Rs 411.98, down Rs 10.18. Ghani Automobile gained Re 0.15 to close at Rs 5.05 on 3.25 million shares. Pak Tobacco and Exide (Pak) were the top gainers with Rs 54.98 and Rs 24.87 to close at Rs 1,154.99 and Rs 522.32, respectively. Rafhan Maize and Bata (Pak) were the top losers with Rs 50.00 and Rs 43.40 to close at Rs 11,250.00 and Rs 3,472.00, respectively.

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PLP NEWS ALERTS EMAIL No. 172-2014 Business and Economy: Pakistan Reserves decline by $63.4 million

July 25, 2014

The total liquid foreign reserves held by the country posted a $63.4 million decline during the last week. According to weekly forex report issued by the State Bank of Pakistan (SBP) on Thursday the country's total liquid foreign reserves stood at $14.45 billion as on July 18, 2014 compared to $14.514 billion as on July 11, 2014.

SBP's liquid forex reserves decreased by $87 million to $9.399 billion compared to $9.486 billion in the previous week. During the period under review, SBP has made payments of $69 million on account of external debt servicing and other official payments, while SBP did not receive any significant inflows during this week. Meanwhile, reserves held by the banks registered an increase of $23.6 million to $5.051 billion as on July 18, 2014 up from $5.028 billion as on 11th July, 2014.

July 25, 2014

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PLP NEWS ALERTS EMAIL No. 172-2014 3.3 to 3.5 percent based on perceptions, models and methods which are not consistent with the approved methods and sources. The working of PBS is according to the International Standards. Recently, the IMF has thoroughly discussed the annual as well as quarterly procedures, which are being observed by PBS and showed its satisfaction.

July 25, 2014

NAVEED BUTT

Pakistan's national saving rate - 13.2 percent of Gross Domestic Product (GDP) - is the lowest in South Asian countries. "Pakistan's national savings is very low which is not positive for economic growth and compares unfavourably with India's 32.9 percent and Bangladesh's 28.8 percent," Secretary Planning, Development and Reforms Hassan Nawaz Tarar said while briefing the Senate Standing Committee on Planning, Development & Reforms.

The standing committee also expressed serious concern at the federal government's 'non- cooperation' with provincial governments to acquire foreign loans for development projects after the passage of the 18th Constitutional Amendment. The committee emphasised the need to improve relations between the federal and provincial governments and recommended that the Ministry of Planning, Development & Reforms should evolve a mechanism to implement its plans. The committee met with former Interior Minister Senator Rehman Malik in the chair at Parliament House on Thursday. Senators Nisar Muhammad, Hilal-ur-Rehman, Amar Jeet and officials of the ministry participated in the meeting.

The Secretary Planning, Development and Reforms told the committee that Pakistan's development budget is 3 percent of GDP - low compared to other South Asian countries with Bangladesh's 5 percent, India's 3.6 percent and Sri Lanka's 6 percent. He said war on terror also severally affected the development and we are paying its heavy cost. He said that GDP growth trends are improving while negativity of war on terror is also decreasing. He said that government has set 5.1 percent growth for next financial years.

About national saving, the secretary said that as a nation we should change our attitude. Our investment is not income generative. Our rich people are spending money on building big houses

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PLP NEWS ALERTS EMAIL No. 172-2014 and buying heavy vehicles and such investment is not productive. He said that lack of interest in the investment is also one of the reasons for low saving. Standing Committee Chairman Senator A Rehman Malik said under 18th Constitutional Amendment, many federal authorities have been devolved to provinces and federal government did not give due share of budget to the provinces.

He said that the Vision 2025 of the Planning Commission is good but there is lack of system to implement it. He said that the government should move towards self-reliance and there is need to broaden tax base. Rehman Malik said that many big investors are shifting to Canada from Pakistan. We should avoid getting debt from the International Monetary Fund (IMF). We cannot mortgage the nation and we have to move toward self-reliance, he added.

He said the federal government should allocate sufficient amount for special support package for rehabilitation of the people of FATA and Khyber Pakhtunkhawa. In this regard, Malik said that he would write a letter to the Prime Minister. The chairman of the committee also sought details of those projects that have been completed. He also raised question about the failure of Nandipur Power Project. He sought the details of funds which are being spent on administrative level and on development and reasons for shelving Diamer-Bash Dam project.

Spokesperson of Ministry of Planning, Development and Reforms Engineering Amir Zameer said that Nandipur Power Project is generating 100 MW electricity. He said that the project was delayed due to picking up of machinery from the Karachi port for three years. He said that the project is being converted from diesel to furnace oil adding that the project could be converted to gas on its availability. Answering a question, he said the project would be converted into Furnace oil in September.

About Diamer-Bash Dam, the spokesperson said the amount has been allocated for the project. If we could not get foreign funding for this project, we will generate funds locally. The project is as important for us as was nuclear project for atom bomb. Rehman Malik said that water mixed diesel is being imported while oil from Attock Refinery is being exported to Afghanistan. He said that the Secretary Ministry of Petroleum and officials of Federal Investigating Agency (FIA) would be summoned in the next meeting to discuss the issue.

The Vision 2015 should also focus on vocational training of students. He said that for this purpose evening classes could be started in colleges and other institutions, he maintained. He said the federal government could not privatize Pakistan Railway without the consent of the provinces because they are the actual owner of the land. About the privatization of PTCL, Rehman Malik said, "UAE is on right track in case of the PTCL privatization. In evaluation process before privatization of PTCL, we had included ghost land and the land acquired on rent," he maintained.

He said that he would invite Senator Raza Rabbani, Secretary of Law Ministry, Finance Minister and representative of planning commission to discuss departments that are means of controversy between Federation and Provinces. We will also propose any amendment in the constitution in this regard if needed. Spokesperson of the Planning Commission Amir Zameer said that a committee has been constituted for this purpose and its first meeting has been held. He said that the committee comprises representatives of federation and provinces. About the security and law and order situation in the country, he said that there is need to equip the police with training of investigation and to improve its skill to counter terrorism. He said that the Planning Commission should plan to bring reforms in police department. All the stakeholders including FIA, IGs of

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PLP NEWS ALERTS EMAIL No. 172-2014 police in the provinces to be consulted to formulate plan for security reforms, he asserted.

He said that for the purpose 50 percent each should be spend by the provinces and federal government adding why the PML-N government did not allocate any fund for improvement of National Counter Terrorism Authority (NCTA). There is need to promote the institution. There is need to provide transport facility in small cities of the country and added that there is need to lay railway track alongside the coast to facilitate transportation from Gwadar port.

July 25, 2014

Pakistan on Thursday said it would re-start work on improving trade ties with arch-rival India when the two nations'' foreign ministers meet in Islamabad next month. Pakistan had pledged to grant India "Most Favoured Nation (MFN)" status by the end of 2012, meaning Indian exports would be treated the same as those from other nations, but so far has not done so.

India granted Pakistan MFN status in 1999. "When the dialogue process resumes, we hope to build on the work already done in this regard," top foreign ministry bureaucrat Aizaz Ahmad Chaudhry told AFP at a weekly press briefing. The foreign secretaries of Pakistan and India are set to meet in Islamabad on August 25 in the neighbouring countries'' latest attempt at improving ties. The proposed meeting, announced by Pakistan''s foreign office on Wednesday, comes after Prime Minister Nawaz Sharif held talks with his Indian counterpart Narendra Modi in New Delhi following the Hindu hard-liner''s inauguration in May. Chaudhry said there were number of issues on both sides for normalising bilateral trade which included "making sure that vulnerable sectors are protected and the issue of the non-tariff barriers in India and the issue of imbalance of trade and certain other infrastructure-related issue."

Bilateral relations broke down after attacks by Pakistani gunmen on India''s commercial hub Mumbai in 2008, in which 166 people were killed, though relations have recovered slightly since then. India in August 2012 lifted a ban on foreign investment from Pakistan except in defence, space and atomic energy in a step designed to build goodwill amid the renewed push for a peace settlement.

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PLP NEWS ALERTS EMAIL No. 172-2014 Copyright Agence France-Presse, 2014 Saarc urged to develop EDI to resolve teething issues

July 25, 2014

MUSHTAQ GHUMMAN

During deliberations, the Commerce Minister emphasised the importance of connectivity; specifically land-ports and energy-grids within the Saarc region. Pakistan also supported India''s proposals to establish a Saarc Development Bank and currency swap agreements which would further the cause of regional connectivity and integration. "Let us have the courage to open hearts and our markets to each other," reported said Commerce Minister who is making all out efforts to convince domestic stakeholders to allow the government to forge good trade relations with India if the latter accepts Pakistan''s demands. Analysts believe as Foreign Secretaries of India and Pakistan are meeting in the forth week of August in Islamabad to carry forward the dialogue process, which implies that trade ties will be on top of the agenda of both the top diplomats.

"Commerce Minister who was isolated in fighting for improvement in trade ties with India will be more than happy to see Foreign Secretaries of both countries discuss trade along with other key issues," commented an official on condition of anonymity. Addressing the SAFTA Ministerial Council, Commerce Minister said in the present scenario of persistent global slow growth, it is imperative that SAFTA member states keep their markets open and keep widening the opening to ensure that the region keeps moving towards the goal of development. He reiterated Pakistan''s assurance of enhanced access to Least Developed Countries (LDCs) within SAFTA, to keep its market open for trade and deepen Pakistan''s integration into the regional economy and to provide all SAFTA partners a non-discriminatory market access on a reciprocal basis. He, however, urged other Saarc countries to take measures to encourage regional trade.

Dastgir further stated that Saarc region should continue to create a business-friendly environment that helps businesses to succeed. However, in motivating SAARC business communities to venture in the region, the member countries need to ensure that they are provided a conducive environment and a level-playing field. He maintained that since assuming his office last June, Prime Minister Nawaz Sharif has made enhancing trade and connectivity in the region the cornerstone of his government''s policymaking. Poor infrastructure and intra-SAARC connectivity remain a paramount issue which the member countries need to overcome in order to ensure that SAFTA realises its true potential.

He said Pakistan has embarked upon strenuous efforts to address infrastructure inadequacies as a matter of high priority. "We believe that in order to improve regional trade ties, we need to build

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PLP NEWS ALERTS EMAIL No. 172-2014 trade and economic corridors with our neighbours by linking our highways, sea and land ports and airport facilities," he continued Keeping in view the significance of land ports in regional connectivity, Pakistan by the end of this year would be establishing Land Ports Authority (LPA) with the objective of effectively and efficiently managing and supervising land ports thus ensuring better facilities to exporters, importers and trade with neighbouring countries, he further added.

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PLP NEWS ALERTS EMAIL No. 172-2014 discussion and come up with a solid set of recommendations; and (v) the regional bloc needs to strengthen the institutional basis of Saarc on the pattern of ASEAN. The member countries may look into the possibility of a strong regional trade promotion team which could propose measures to boost intra-SAARC trade in close co-ordination with Saarc Chamber of Commerce and other leading trade bodies/associations of the region. He stated that Pakistan will continue to be a staunch advocate of free trade and appropriate vehicles that can further this agenda. A free and open regional economy is an important part of Pakistan''s growth, he concluded.

July 25, 2014

Punjab Chief Minister Shahbaz Sharif has said that that the government has evolved the biggest Annual Development Programme (ADP) in the history of the province for the current fiscal year and record funds of Rs 345 billion have been allocated for development projects. He said that huge resources of Rs 119 billion have been earmarked for the development projects of various districts of South Punjab. He said that hard work and professionalism is needed for the achievement of the targets of the ADP.

He was presiding over a high-level meeting regarding Annual development Programme for the year 2014-15, here on Thursday. Member National Assembly Hamza Shahbaz Sharif, Finance Minister Mujtba Shuja-ur-Rehman, Member Provincial Assembly Dr Ayesha Ghaus Pasha, Chief Secretary, Chairman Planning & Development, Secretary Finance, Chairman PITB and concerned officers were present.

Addressing the meeting, the Chief Minister said that three districts and officers of three departments showing outstanding performance regarding utilisation of the development budget for the last fiscal year would be encouraged and also awarded commendatory certificates while those showing poor performance would be held accountable.

He directed that a comprehensive system be evolved through information technology regarding the issuance of development funds and their utilisation. He said that the policy of third-party audit of development projects be strictly implemented as in case of failure, action would be taken against the concerned authorities.

Shahbaz Sharif said that district development committees have been formed for the implementation of the development programme. Issuing instructions for the setting up of a cabinet committee, he said that it would review implementation of ADP on permanent basis. He directed Chief Secretary to hold meetings twice a month to review implementation of ADP and said that he would also review it on monthly basis.

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PLP NEWS ALERTS EMAIL No. 172-2014 Economic activities: PIAF urges government to ensure participation of women

July 25, 2014

Pakistan Industrialists and Traders Associations Front (PIAF) Chairman Malik Tahir Javed has urged the government to ensure active participation of women in economic activities, as they constitutes more than half of our population and dream of economic stability could not come true without their significant role.

He was talking to a delegation of women Entrepreneurs, led by former LCCI Executive Committee Member Nabila Intisar, here on Thursday. He briefed the delegation about PIAF strategy for women empowerment saying that a large number of women would participate in the LCCI forthcoming elections from the platform of PIAF and said that concerned government departments should impart training to needy skilful women as despite having all the talent, a number of women were unable to make a mark in the international market.

He said women constitute more than half of our population but their natural creative abilities are unutilised; therefore, there is dire need to encourage them join mainstream economy. He said that their participation in business will change complexion of society and perception of the country.

He said though in recent years government has been focusing more on the development of women entrepreneurs in the country still due attention is needed by offering focused opportunities in export of goods to international market. He said the products prepared by women entrepreneurs should be allowed concession in taxes. He urged the government to come up with a more aggressive package for the women entrepreneurs.

PIAF Chairman while urging the women to come forward and show their abilities said the conditions have much improved in Pakistan, both in rural and urban areas. Today's women are well aware of their rights, are equally educated and are entering into non-traditional businesses like boutiques, textile designing, printing and publishing, architecture, banking, IT, business management and fashion designing. He said despite the fact that Pakistan has all resources in abundance and quality-wise its goods are 'best of the best' in the entire world but it has so far failed to get its share in the world economy only because of poor brand management in Pakistan. He said that branding is one of the tools that helps highlight the soft image of any country besides giving required boost to its exports. Malik Tahir Javed also urged Trade Development Authority of Pakistan (TDAP) to give due participation to the women entrepreneurs in the TDAP trade delegations.

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PLP NEWS ALERTS EMAIL No. 172-2014 One Stop Shop to be set up at LCCI to facilitate investment

July 25, 2014

In order to boost investment, the federal government would establish One Stop Shop (OSS) at the Lahore Chamber of Commerce and Industry (LCCI) within three months. This was decided during a meeting between the LCCI Senior Vice President Mian Tariq Misbah and Investment Climate Advisor of Implementation and Economic Reforms Unit (IERU) Umer Khalid here at the Lahore Chamber of Commerce and Industry. Deputy Secretary IERU Fozia Abid, Deputy Manager Punjab Board of Investment Shehryar Rana, Azhar Hussain and Deputy Commissioner Inland Revenue Dr Ali Adnan Zaidi also attended the meeting.

The objective of the establishment of One Stop Shop is to improve the business climate in the country and Implementation and Economic Reforms Unit (IERU) of Finance Division is co- ordinating the development of OSS. The OSS would be a point where various procedures related to new business set-up requiring interaction with different government agencies are centralised in one location.

Securities Exchange Commission of Pakistan, Federal Board of Revenue and Employees Old Age Benefit Institutions (EOBI) had already signed MoU in this respect. Speaking on the occasion, the LCCI Senior Vice President Mian Tariq Misbah said that LCCI would facilitate the government in early establishment of One Stop Shop. He said that LCCI had been calling for a long time that there should be a one window operation to facilitate the local and foreign investors.

He said that OSS would not only encourage the foreigners but would also give encouragement to the local businessmen to put their money in new ventures. He said that according to the World Bank 2014 Doing Business Report, Pakistan ranks 105th, as far as the ease of starting a business is concerned. The new companies in Pakistan face tremendous difficulties in getting registrations and approvals from various ministries and government departments.

He said that the total number of procedures required to register a firm in Pakistan are 10, which are markedly higher as compared to the South Asian countries average of seven and OECD countries average of 5. Similarly the total number of days required to register a firm in Pakistan are 21, higher than the South Asian countries average of 16 and OECD countries average of 11.

LCCI Acting President said that this scenario necessitates the establishing of a One Stop Shop which will provide facilitation in business registration procedures relating to different government agencies in one physical location. He said that One Stop Shop would help in integrating different registration steps with different levels of government into a single streamlined process. Studies have shown that in Mexico and Columbia, where the One Stop Shops were implemented, the number of registered businesses increased by more than five percent.

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PLP NEWS ALERTS EMAIL No. 172-2014 CDA directives: Development work in Park Enclave housing scheme soon after Eid

July 25, 2014

The Capital Development Authority (CDA) has directed the contractor to mobilise machinery for the commencement of development work in Park Enclave housing scheme soon after Eid-ul-Fitr. To review the progress about the commencement of development work in Park Enclave, a high- level meeting was held at CDA Headquarters.

Chairman CDA, Maroof Afzal presided over the meeting. On this occasion, Member Administration and Estate Amir Ali Ahmed, Member Engineering Shahid Sohail and officers of concerned formations of the Authority were also present. Maroof Afzal said Rs 500 million had been allocated for the development of the housing scheme during the current fiscal year and directed the concerned formations of the Authority to start development work in Park Enclave without further delay so that the allotters could be given possession.

Chairman CDA was apprised that boundary wall around the housing project had been completed, which had secured the acquired land and the contract for development work of Park Enclave had been awarded after completing all the code formalities of the tendering process.

Now in line with the directions of Chairman CDA, the contractor would mobilise the machinery to start the development work in Park Enclave soon after Eid-ul-Fitr. He was informed that the development work in Park Enclave would cost approximately Rs 1,260 million, which included construction of major roads, service roads, streets, footpaths, drainage system, water supply lines with complete water supply system, sewerage system, construction of bridges and culverts and electrification work. The development work also includes construction of main entry gate and security check posts and landscaping of the housing project and that the housing project would be completed within a period of one year time.

Maroof Afzal directed the concerned formations of the Authority to take all effective measures for completion of development work in Park Enclave before one year period and utilise the best professional skills for the housing project. He directed the concerned formations of the Authority to ensure early completion of development activities in the state of the art housing project.-PR

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PLP NEWS ALERTS EMAIL No. 172-2014 Bestway Cement acquires Lafarge Pakistan plant in Chakwal

July 25, 2014

Bestway Cement Limited (Bestway Cement), a subsidiary of Bestway Group (Bestway), on Thursday announced the successful acquisition of Lafarge Pakistan Cement Limited (Lafarge Pakistan). The Pakistan-listed subsidiary has acquired Lafarge Pakistan's 2.4 million tonnes per annum (TPA) cement plant located in Chakwal, Pakistan for an enterprise value of US $329 million.

As a result of the acquisition, Bestway Cement now represents 18 percent of the entire industry's capacity in Pakistan, with its capacity set to increase to eight million TPA. The transaction means Bestway Cement has now become the country's largest cement manufacturer. Zameer Choudrey, Bestway Group Chief Executive and CEO of Bestway Cement said: "We are excited about the prospect of adding Lafarge Pakistan Cement to our existing portfolio. Through this investment we have reinforced our commitment to Pakistan where our cement and banking businesses continue to flourish. We see great potential for the cement business to keep growing, and will continue to review opportunities to invest in it further. For now, we will be working to integrate Lafarge into our existing cement business, adding efficiencies and synergies where possible."

The UK based global conglomerate is the UK's eighteenth largest privately owned company and seventh largest family-owned business. Bestway includes the UK's second largest wholesaler serving 125,000 independent retailers and caterers from 64 warehouses nation-wide and with over 6 million square feet of selling space.

United Bank Limited, Bestway's banking division, is Pakistan's second largest private bank with assets under management of US $10.3 billion and a branch network of over 1,400 branches serving over five million customers. This latest acquisition comes less than a week after the Group's US $1.1 billion acquisition of the UK's third largest pharmacy business - The co- operative Pharmacy. The pharmacy business has over 770 branches across the UK and over 7,000 employees. In 2013 it reported total revenues of US $1.3 billion and EBITDA of US $116 million. With these recent acquisitions, Bestway will have an annual turnover of approximately US $6 billion and a global workforce of 33,000 people.-PR

July 25, 2014

The Karachi Port handled 101,571 tonnes of cargo comprising 78,483 tonnes of import cargo and 23,088 tonnes of export cargo including 4,082 loaded and empty containers during the last 24 hours ending at 0700 hours on Thursday. The total import cargo of 78,483 tonnes comprised of

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PLP NEWS ALERTS EMAIL No. 172-2014 32,894 tonnes of containerised cargo; 24 tonnes of general cargo; 28,725 tonnes of bulk cargo: 22,540 tonnes of coal; 6,185 tonnes of soyabean meal and 16,840 tonnes of oil/liquid cargo.

The total export cargo of 23,088 tonnes comprised of 18,288 tonnes of containerised cargo and 4,800 tonnes of oil/liquid cargo. As many as 4,052 containers comprising 2,081 containers import and 1,971 containers export were handled during the last 24 hours on Thursday. The breakup of imported containers shows 1,001 of 20's and 533 40's loaded while 14 of 20's and nil of 40's empty containers, whereas that of exported containers shows 500 of 20's and 246 of 40's loaded containers while 109 of 20's and 435 of 40's empty containers were handled during the business hours.

There were three ships namely Cape Marin, Posen and Desh Mahima containers and oil tanker respectively sailed out to sea during the reported period. There were two vessels viz. Kota Kasturi and Fidias carrying containers and oil tanker respectively currently at the berths. There were two ships namely Port Menier and Ikan Prang carrying oil tanker and coal respectively sailed out to sea on Thursday, while three ships namely Santa Rosa, YM Elixir and Marselis Borg carrying containers and project cargo respectively are expected to sail on Friday.

There were five vessels viz. APL Sydney, Naira, UASC Ajman, Cosco Kobe and Marselis Borg carrying containers and project cargo respectively due to arrive on Thursday, while eight vessels viz. Wan Hai-512, PAC Aries, Hyundai Jakarta, Eleni-1, Palmerton, Liberty Promise and King Grace carrying containers, oil tanker, vehicles and general cargo respectively are due to arrive on Friday.

PORT QASIM

A cargo volume of 165,814 tonnes comprising 116,994 tonnes of import cargo and 48,820 tonnes of export cargo inclusive 3,084 loaded and empty containers (TEUs) was handled at Port Qasim during the last 24 hours on Thursday. The total import cargo of 116,994 tonnes includes 62,506 tonnes of furnace oil; 19,250 tonnes of palm oil; 2,406 tonnes of iron ore and 32,832 tonnes of containerised cargo.

The total export cargo of 48,820 tonnes includes 14,506 tonnes of cement and 34,314 tonnes of containerised cargo. As many as 3,084 containers comprising 1,278 containers import and 1,806 containers export were handled during the last 24 hours on Thursday. There were three ships namely CV Posen, CV Maersk Kingston and MT Quetta with containers and oil tanker sailed out sea on Thursday morning, while two more ships namely CV CMA CGM Corneille and MT Feng Hai-35 with containers and oil tanker are expected to sail on the same day afternoon.

A total number of ten vessels viz. CV Posen, CV CMA CGM Corneille, CV Safmarine Ngami, CV Maersk Kingston, MV Thor Breeze, MV Anna Maria, MV Arundel Castle, MT Theresa Mars, MT Feng Hai-35 and MT Quetta currently occupied berths to load/offload containers, cement, iron ore, palm oil and diesel oil respectively during the last 24 hours.

As many as five ships namely Saigon Express, Marth Cshulte, Al-Soor-II, MT Karachi and Ashada with containers, diesel oil and furnace oil are currently at the outer anchorage of Port Qasim. There were four vessels viz. CV Saigon Express, CV Marth Cshulte, CV Tabae and MT Karachi with containers and

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PLP NEWS ALERTS EMAIL No. 172-2014 furnace oil expected to take berths at Qasim International Containers Terminal and FOTCO Oil Terminal respectively on Thursday. There are no ships due to arrive on Thursday.

July 25, 2014

The country's automotive industry and auto parts manufacturers are suffering heavily from the aftershocks of inconsistent import policies, rampant import of used cars and frequent amnesty schemes of the past government.

Chairman of Pakistan Association of Automotive Parts and Accessories Manufacturers (Paapam), Usman Malik while quoting some reports in the press said that a mafia of used car importers, in connivance with the Customs as well as FIA officials, is misusing the personal baggage schemes, which are meant only to facilitate overseas Pakistanis for importing their own used vehicles. These press reports have proposed that in order to control this situation, all overseas Pakistanis who bring their personal vehicles to Pakistan, should be required to register these imported used cars in their own names in Pakistan, with the condition that they cannot sell or transfer it for few years.

As per current rules, overseas Pakistanis are required to stay abroad for at least two years and the vehicles, which they wish to import, must be in their possession during their abroad stay. Besides they have to produce foreign vehicle registration certificates along with driving license at the time of clearance.

However, according to reports, this scheme is controlled by a mafia, which is being patronised by a lobby of some Customs and FIA officers. Now, majority of the vehicles, being imported under this scheme, are not owned by overseas Pakistanis but their passports are stamped by corrupt immigration officers and used for commercially importing used vehicles from Japan.

PAAPAM chairman further quoted above reports regarding purchase copies of passports of overseas Pakistanis by used car dealers for exploiting this scheme. These photocopies of passports were then imprinted with fake departure and arrival stamps to complete required formalities for imported vehicles clearance. He mentioned that the used car dealers have so far poured billions of rupees in this business, which has no connection with overseas Pakistanis. Usman Malik urged the authorities to take bold steps not only to provide support to the local industry but also help in eradicating malpractices in this sector.

The industry representatives have time and again expressed their concerns to FBR to review the duty rates fixed in SRO 577 in line with current exchange rates, but, despite consensus, a very minimal increase was made in the last budget.

He said the car import policy was relaxed in December 2010, when used cars of up to five-year-

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PLP NEWS ALERTS EMAIL No. 172-2014 old were allowed to be imported, but this was reverted back to three-year-old cars in December 2012 to offer relief to the local auto industry. During these two years, about 92,000 used vehicles were imported, but, even after reduction in age limit to three years, a further substantial quantity of 17,968 units have been recently imported up to 10 months ended on April 30, 2014. These stocks are still available for sale in showrooms and continue to haunt the sales of locally manufactured auto parts, he added.

He further said that the import policy (in combination with the reported malpractices) continues to pose a threat for the local auto industry because, while import of used cars have been restricted to three years, all other vehicles such as vans, SUVs and 4x4 vehicles up to five-year-old are allowed to be imported under the current laws.

July 25, 2014

Punjab Chief Minister Shahbaz Sharif has said the government is implementing various programmes for the empowerment and provision of employment opportunities to the youth. He said 'yellow cab scheme' was being started from October that year under which 50,000 vehicles would be given to the unemployed youth on soft terms.

He was presiding over a high-level meeting here on Thursday which reviewed various proposals for the launching of 'yellow cab scheme' under Self-Employment Programme. Assembly Members Ayesha Ghaus Pasha, Sheikh Alauddin, Chief Secretary, Chairman Planning & Development, President Bank of Punjab, Secretaries of Finance and Information departments, Managing Director Suzuki Company and concerned officials were present.

Addressing the meeting, the CM said a transparent and computerised system would be adopted for the distribution of vehicles under 'yellow cab scheme' and the government would also give subsidy on those vehicles. Shahbaz Sharif said that Punjab government had initiated several programmes for the empowerment of youth and soft-term loans were being given to them under Self-Employment Programme for setting up their own business and thousands of youth have benefited from that revolutionary programme.

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PLP NEWS ALERTS EMAIL No. 172-2014 Punjab Metro Bus Authority approves budget: 68 buses to be purchased

July 25, 2014

Punjab Chief Minister Shahbaz Sharif presided over a meeting of Punjab Metro Bus Authority here on Thursday, which approved its budget for the year 2014-15. The meeting also gave approval to the purchase of 68 buses for Rawalpindi-Islamabad metro bus project besides necessary measures with regard to orange line metro train project.

Chairman Lahore Transport Company Kh Ahmed Hassaan, Assembly Members Waheed Alam Khan, Malik Ibrar Ahmed, Kh Imran Nazir, Ramzan Siddique Bhatti, Hanif Abbasi, Hafiz Mian Nauman, Iftikhar Ahmed, Chairman Planning & Development and concerned officers were present. Addressing the meeting, the CM said Punjab government was implementing a revolutionary programme for the provision of safe, comfortable and economical travelling facilities to the masses.

He said that effective measures had been taken for the improvement of transport system, adding that about 175,000 people were benefiting daily from the splendid project of Lahore metro bus which had also given a new identity to the provincial metropolis. He said orange line metro train project was also being launched which would not only provide modern travelling facilities to the citizens but the transport culture would also be revolutionised. He said that feasibility study of purple line metro train and blue line metro train would also be conducted.

Shahbaz Sharif said Rawalpindi-Islamabad metro bus project would be completed during the current year which would result in provision of speedy transport facilities to the people of the twin cities. He said foundation stone of metro bus project in Multan would be laid on August 14, adding that measures taken by the government for the improvement of transport system had yielded positive results. The Managing Director Punjab Metro Bus Authority gave a detailed briefing to the meeting.

July 25, 2014

IQBAL MIRZA

Indeed, only Pakistan International Airlines could do it - send a distress signal from a parked aircraft. Distress signal is generally sent from an aircraft in the air in case of emergency seeking help to save lives of passengers. From the safety point of view also it is very vital for the security of the aircraft. Now imagine an aircraft parked in Islamabad sending this signal!!!. This technical error is a sheer negligence on the part of PIA and a breach of safety rules, according to a well- informed source.

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PLP NEWS ALERTS EMAIL No. 172-2014 He said the management of Pakistan International Airlines has been found least bothered about its engineering department that is committing serious errors while showing complete inefficiency. He further said that in the last week of previous month, Pakistan Space and Upper Atmosphere Research Commission (Suparco) had informed the Civil Aviation Authority (CAA) about receiving a distress signal initiated from an ATR aircraft of national flag carrier AP-BHO, which was later found to be on ground in Islamabad. The CAA immediately passed on the information to PIA bosses but found it extremely disturbing that PIA bosses showed no surprise and took the notice in routine.

The CAA showed annoyance on PIA for taking things so lightly and not putting its engineering department in order. The management, it appears, is least bothered about this issue and is covering up it through lame excuses. "The management justified by replying to CAA that their technical staff already knew that the plane was on ground in Islamabad. They said their situation room is alert and ready to deal with any such issues," said the source.

It is quite ironic that the airline management is not paying heed to follow systems and protocol but busy showing newly inducted A-320 to the Prime Minister despite the fact that it is not even owned by them and they don't have any engineering facility for the same. "They cannot handle their own aircraft which has been proved by this example when one aircraft was found giving distress signal while on ground. So how they can manage the three A-320 planes they are inducting in the fleet when they don't even have engineering facility for them," asked the source.

The source added that AP-BHO was parked at Islamabad airport and it was found after investigation that the relevant system of the aircraft was not active. Consequently, the maintenance department at Islamabad airport carried out a system recycle to rule out any technical discrepancy. "Given the severity of the issue, PIA has asked for feedback regarding exact duration of distress signal, present status, and location tracked by Suparco to analyse the situation. However it denied finding any discrepancy by the engineering department at the time of inspection of the AP-BHO," added the source.

The source said that this is a serious issue as it could jeopardise the significance of the emergency system. "This signal is generated in emergency situations and considered very important in such situations. Its importance in Pakistan has increased in past few years as the country has seen many incidents of plane crashes," reasoned the source. But, the source added, the casual response of PIA is a proof that they are not bothered by any means at the time when the airline industry of Pakistan is going through crucial times of its history. "The management of PIA should not take such issues lightly as it will devastate the image of whole aviation industry of Pakistan," suggested the source.

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PLP NEWS ALERTS EMAIL No. 172-2014 Emirates Airlines resumes operations from Peshawar

July 25, 2014

Emirates Airlines on Thursday resumed its flight operations to and from Peshawar after a month- long hiatus, with first flight taking off for Dubai at 8:45am from Bacha Khan International Airport Peshawar. The international carrier had suspended its services in the provincial capital after bullets pierced through a Pakistan International Airlines (PIA) plane near the airport, killing one female passenger on June 25.

Along with Emirates, Qatar Airways and Etihad Airways had also suspended their operations from Peshawar's Bacha Khan International Airport. Qatar Airways had resumed its services early July while Etihad Airways is expected to restart flight operations soon. Security at the airport has been beefed up since the attack and anyone seeking entrance to the airport is thoroughly checked, while checkpoints around the airport have been increased.

July 25, 2014

Governor Khyber Pakhtunkhwa Sardar Mehtab Ahmad Khan has said that the government is paying attention to the country's economic uplift by expanding and upgrading its highway network to make Pakistan trade hub for the region in the years to come.

He expressed these views while inaugurating the new Khushal Garh Bridge near Kohat. Minister of State Abdul Hakeem Baloch, on this occasion, made the welcome address while Federal Minister for Textile Senator Abbas Khan also addressed the ceremony. Sardar Mehtab Ahmad Khan said Khushal Garh Bridge would boost relations between the provinces of Punjab and Khyber Pakhtunkhwa and would also improve trade, tourism, industry and agriculture of the region, he added.

The Governor said recently new oil and gas reserves had been discovered in Kohat and the bridge would help transport crude oil to Attock Refinery. The Governor said when the government took over, the country was confronted with many challenges but "we began the journey to progress with a renewed vigor and determination and with the Grace of Allah, we have achieved numerous successes."

Sardar Mehtab Ahmad Khan said the development vision of Prime Minister Nawaz Sharif reflected rapid progress in all sectors and "we will overcome the problem of loadshedding with the construction of new dams." He said the government was providing all basic facilities to the

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PLP NEWS ALERTS EMAIL No. 172-2014 one million IDPs of North Waziristan. Earlier, Minister of State Abdul Hakeem Baloch in his welcome address, thanked the KP Governor and other distinguished guests and added that with the construction of new highways and motorways, an economic revolution would be witnessed that would lift the living standard of the people. -PR

July 25, 2014

M RAFIQUE GORAYA

The Finance Department of Punjab government has finally issued the notification for payment of double pension to all employees attaining the age of 75 years after keeping the case pending for more than one year. Ombudsman Punjab Secretariat told Business Recorder here on Thursday that to begin with the provincial government will clear the arrears of pending payments of the pensioners attaining the age of 75 years entitled for double pension (restoration of commuted portion of pension) as the same were not being paid since years.

Ombudsman Punjab had directed Secretary Finance and Accountant General Punjab to pay arrears of double pension to the retired employees before Eid. It may be recalled that the old pensioners of Punjab government had been fighting for their legitimate right since many years and submitted an appeal to every available forum for justice.

Punjab Services Tribunal, Lahore High Court, Federal Services Tribunal and Ombudsman Punjab ordered to pay double pension. A Full Bench of Supreme Court of Pakistan, headed by the Chief Justice, also dismissed review petitions of the Punjab Government on the same issue. Ultimately efforts of the old pensioners got reward and they won all cases. The Finance Department vide its circular omitted a para, inducted in 2001, according to which even the civil servants retired on or after 01.12.2001 would be entitled to restoration of their commuted portion of pension along with all increases on expiry of commuted period of pension which was, in fact, not allowed prior to the issuance of Supreme Court of Pakistan verdict.

The heirs of all those pensioners who expired after attaining the age of 75 after 2001, will also get the arrears and dues of the deceased pensioners. Ombudsman Javed Mahmood said that Mohtasib Punjab Pension Cell, Finance Department and media played an active role for the right of restoration of pension for old pensioners. He said that untiring efforts of pensioners to seek their right is an example for the civil servants. On the occasion, all the retired pensioners have expressed their happiness and gratitude to the Ombudsman Punjab for the support provided in their noble cause.

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PLP NEWS ALERTS EMAIL No. 172-2014 Cotton and Textiles: Pakistan Lean business on cotton market ahead of Eid holidays

July 25, 2014

DR ZAFAR HASSAN

Cotton market faces prolonged closure beginning this weekend extending practically to the beginning of August 2014 due to the Eid-ul-Fitr holidays notified by the government from the 29th of July to the 1st of August 2014. Including the pre-Eid and post Eid weekends, the cotton market, indeed all business activity in Pakistan, will remain mostly closed till the beginning of August 2014.

Some mills bought moderate quantities of cotton over the past week or so to fulfill their immediate needs. In consonance with the bearish global trend in cotton such as in the United States, China and India, Pakistan fibre prices also conceded considerable decrease in seedcotton (Kapas/Phutti) as well as lint cotton prices over a week or so. Seedcotton (Kapas/Phutti) prices reportedly decreased by Rs 300 to Rs 400 per 40 Kgs., while lint prices are said to have suffered a decline of Rs 300 to Rs 400 per maund over the past one week's time. Thus seedcotton prices in both Sindh and Punjab are said to have prevailed from Rs 2800 to Rs 2900 per 40 Kgs, while the lint prices ranged from Rs 5800 to Rs 5850 per maund (37.32 Kgs) on Thursday. Cottonseed (Binola/Kakra) prices are said to have decreased from Rs 1500 to Rs 1200 per maund losing nearly Rs 300 per maund to reported imposition of sales tax on cotton cake (Khali) which the ginners are resisting to pay. The Karachi Cotton Association (KCA) has reduced the ex-gin price of grade three cotton from Rs 6150 fixed on last Saturday to Rs 5800 a maund on Thursday, a decline of Rs 350 per maund.

Monsoon rains have started in recent weeks in Pakistan in modest quantities in both Sindh and Punjab which should be beneficial to the standing cotton crop. More rains are expected to follow which in reasonable quantities would be beneficial but excessive downpour could damage the crop.

Thus there was scant buying by the spinners this week but a few exporters probed the market. Some spinners fear that excessive sprinkling of rains could drench the cotton so that the quality of lint may suffer. Therefore, spinners are now restraining themselves from post Eid buying to avoid receiving any rain drenched cotton.

Because yarn prices are generally dull in both local and international markets, mills in Pakistan are buying their cotton requirements cautiously. Thus the domestic cotton market is essentially quiet. Deliveries of earlier purchased cotton may continue for the next couple of days and then the holiday mood ahead of the incoming Eid-ul-Fitr will prevail. Due to the impending holidays, transport to haul cotton from the ginning factories to the textile mills will not be available within a couple of days or so.

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PLP NEWS ALERTS EMAIL No. 172-2014 In ready sale, 400 bales of cotton from Sanghar in Sindh sold at Rs 5800 per maund (37.32 Kgs), 200 bales from Tando Adam sold at Rs 5850 per maund, while 200 bales of cotton from Chichawatni in Punjab sold at Rs 5900 per maund. On the global economic and financial front, the stubborn investors trust their fund managers that recovery, that hard to catch economic phenomenon which is absent in most of the countries, is just around the corner. Hence the blind faith of the investors in their fund managers and hedge funds which continues to prop up the stocks markets.

Thus this week again the shares prices in several regions and countries mostly moved up despite a number of obvious difficulties facing the global economy over the past six years. Never has the world seen such a deep-rooted collapse of business, banking and industrial infrastructure since the Great Depression of 1929. Several factors have accumulated to ensure further decline in the global economic architecture which has reached all the corners of the globe. It is a foregone conclusion that untold millions of people around the globe have been ravishly devastated and unemployment has ballooned to colossal proportions. As has been referred by some economists, today we continue to suffer widely from The Great Depression of the 21st Century.

Again and again we are reminded by the likes of The International Monetary Fund (IMF) that in the United States the economy has not really recovered. This week the IMF again lowered the US economic forecast for 2014 following the sharp contraction due to a severe winter during the first quarter.

From Lehman Brothers to the bank of the Vatican, and indeed in all banking and brokerage institutions around the world, particularly in the Western World including Europe and also in the "shadow banking" in China, the revelations into their unethical and also criminal activities is phenomenal.

Argentina is again said to be mired in banking defaults, the Ukraine political flashpoint remains disturbing for the global eco-political peace. South Korea, an exemplar economy over the past several decades is reported to be preparing a stimulus package for its economy.

Once again the consumer confidence in the Eurozone has reportedly fallen much more than anticipated. This news does not bode well for the recovery of the zone which can be seen from the recent data released by the European Commission. Then there are those observers who have stated that the meltdown of the markets in 2008-2009 "was the institutionalized fraud and financial manipulation". As a result, large amount of unemployment around the world and falling living standards are deemed to put the "entire structure of international commodity trade in potential jeopardy".

July 25, 2014

Moderate trading was seen on the cotton market on Thursday in the process of trading, dealers said. The official spot rate was unchanged at Rs 5800, they said. The seed cotton prices were lower by Rs 100 to Rs 2800-2900, in the ready session, around 8000 bales of cotton were

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PLP NEWS ALERTS EMAIL No. 172-2014 finalized between Rs 5800 and Rs 5900, they said.

Cotton analyst, Naseem Usman said that mills were active in covering the pre-Eid buying as declining rates were matching with their psychological levels. In the meantime, growers and ginners were not so happy but selling, some brokers said. The NY cotton futures were higher on Wednesday.

The following deals were reported: 400 bales of cotton from Kotri at Rs 5800, 200 bales from Hyderabad, 200 bales from Golarchi, 800 bales from Tando Adam, 1000 bales from Shahdadpur, 200 bales from Pak Pattan each at the same rates, 800 bales from Burewala at Rs 5800/5900, 600 bales from Chichawatni at Rs 5800/5900, 400 bales from Khipro at Rs 5800, 1000 bales from Mirpurkhas at Rs 5800, 600 bales from Arifwala at Rs 5800/5900 and 200 bales from Sahiwal at Rs 5900.

======The KCA Official Spot Rate for Local Dealings in Pak Rupees ------FOR BASE GRADE 3 STAPLE LENGTH 1-1/32" ------MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL ======Rate Ex-Gin Upcountry Spot Rate Spot Rate DifferenceFor Price Ex-Karachi Ex. KHI. As Ex-Karachion 23.07.2014 ======37.324 Kgs 5,800 155 5,955 5,955 NIL ------Equivalent ------40 Kgs 6,216 155 6,371 6,371 NIL ======

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PLP NEWS ALERTS EMAIL No. 172-2014 Agriculture and Allied: Pakistan Pakistan, France to promote bilateral trade in agriculture sector

July 25, 2014

Pakistan and France Thursday agreed to explore possibilities for collaboration and strengthen bilateral trade in agriculture sector. The issue of bilateral trade relations came up to discussion during the meeting of Ambassador of France for Pakistan, Philippe Thiebaud with Federal Minister for National Food Security and Research (NFSR), Sikandar Hayat Khan Bosan.

Among others, Seerat Asghar Secretary NFSR and other high officials of the ministry were also present on the occasion. It was realised in the meeting that both the countries possess huge potential for expanding bilateral trade in multiple areas of agriculture particularly in dairy and livestock sectors.

The Federal Minster appreciated the technical support of France to agricultural scientists and farmers in Pakistan. On the issue of ban on import of live cattle from France, the federal minister informed that in the wake of 18th Amendment, Federal government cannot take a unilateral decision without consulting provincial governments. Earlier, Philippe Thiebaud raised the issue of ban on import of live cattle from France and requested for revisiting the decision.

It may be mentioned here that as per SRO (1)/2001 dated 28th June, 2001, Ministry of Commerce imposed ban on import of live animals, meat, tallow and feed ingredients from BSE (Bovine Spongiform Encephalopathy) or Mad Cow infected countries such as UK, Ireland, Canada, France, USA etc. Pakistan has been historically free from BSE and Pakistan has adopted zero tolerance policy in this regard and banned import of cattle from BSE infected declared countries.

Economic Co-ordination Committee (ECC) recently revised the policy and allowed import of live cattle from countries which have been declared as having `Negligible BSE risk' by World Organisation for Animal Health, (OIE) subject to condition that animals from such/those herds shall be allowed for import where no incidence of BSE has been reported for the last eleven years and this fact shall be certified by the concerned Veterinary Authority of the exporting country. On the other hand, France falls under "Controlled BSE risk" country as per classification by OIE and therefore ban on import of live cattle from France persisted.

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PLP NEWS ALERTS EMAIL No. 172-2014 Daily trading report of PMEX

July 25, 2014

On Thursday at Pakistan Mercantile Exchange (PMEX) value traded was recorded at PKR 2.542 billion as compared to PKR 1.783 billion registered on Wednesday, up 42.57 percent. Number of lots traded was 13,109 and PMEX Commodity Index closed at 3,070. Major business was contributed by crude oil amounting to PKR 1.780 billion up by 82 percent followed by gold amounting to PKR 716 million and silver at PKR 46 million.

July 25, 2014

Pakistan's rice exports during June-2014 registered a decrease of 8.44 per cent as compared to May-2014. Export figures released by Pakistan Bureau of Statistics (PBS) indicated that Pakistan has exported rice worth US $149million down by US $13.75m ie 8.44 per cent and in terms of volume, the country's export of rice went down by 5, 792 metric tons ie 2.3 percent to 248, 789 metric tons, last month.

Attributing frequent postponement of shipments of rice to shortage of electricity during June, rice exporters claimed that they had suffered a loss of around $100m as against their monthly target. Rice export suffered badly as exporters could not meet the deadlines of their foreign orders due to prolonged loadshedding and such situation diverted a number of international buyers towards other rice markets," they said. According to PBS data, export of different varieties of rice has decreased by 3pc in June-2014 to US $98m from US $101m in May-2014.

Meanwhile, rice exporters have urged the government to bring an end to the menace of prolonged load-shedding or provide separate power connections to each factory. They also demanded of the government to control Karachi's law and order situation to avoid further extension in delivery period of shipments.

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PLP NEWS ALERTS EMAIL No. 172-2014 'Monsoon rains likely to boost major Kharif crop production'

July 25, 2014

FAZAL SHER

The current monsoon rains are likely to boost major Kharif crop production including sugarcane and cotton. Agriculture experts and officials Ministry of National Food Security and Research (NFS&R), while talking to Business Recorder, stated that recent normal rains would bring a positive impact on Kharif crop including sugarcane, maize and cotton.

Sources said at present the cotton crop was at boll formation stage in Sindh and some limited areas of Punjab, where crop was sown in February and March. The cotton in major areas of Punjab is however at flowering stage, they said. However, they said heavy rains might negatively impact on production of cotton in the country as they led to various diseases in the cotton crop and a large quantity of water did no good to the cotton crop.

An official said that cotton was cultivated on 2.93 million hectares with an estimated production of 15.1 million bales. Punjab was expected to produce 10.5 million bales, Sindh was projected to produce 4.2 million bales, Balochistan and Khyber Pakhtunkhawa were targeted to produce 0.4 million bales of cotton, he said.

The National Space Agency of Pakistan and Pakistan Space and Upper Atmosphere Research Commission (Suparco) have estimated sugarcane output of 72.9 million tons from an estimated area of about 1.25 million hectares. Sources further said sugarcane crop was at early growth stage and it required large quantities of water and the recent rains would prove a blessing. The highest production of about 48.1 million tons is expected from Punjab province followed by about 16.8 million tons from the Sindh province and eight million tons from Khyber Pakhtunkhwa (KP) province.

Another expert from Agriculture Policy Institute concurred and said recent rains would be very beneficial for the Kharif crops and at that stage most of the Kharif crops required adequate water especially sugarcane for further nourishment. He said rainwater had more nutrients than tub-well water due to which rains would bring positive impact on wheat production. Rains would have a positive impact on minor crops including maize, Moong and chilies, he concluded.

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PLP NEWS ALERTS EMAIL No. 172-2014 Poultry contributes 40 percent of total meat consumption

July 25, 2014

Raza Mehmood Khursand, Chairman Pakistan Poultry Association, has said the poultry sector is one of the most organised branches of the agro-based sector of Pakistan. In a press statement issued here on Thursday, Khursand said poultry sector had been serving the nation since 1962 and providing affordable poultry products to the masses to fulfil the requirements of animal protein.

Poultry at present contributes 40 percent of the total meat consumption and generates employment and income for about fifteen hundred thousands people. It is also pertinent to mention here that PPA is providing subsidy in Sasta Ramazan bazaars. Raza Khursand, while talking about subsidy, which is being paid by PPA to sale centres situated in Ramazan bazaars, said he was invited by Secretary Livestock Dr Muhammad Aamir Muhammad Arshad Jatt, Advisor to the Chief Minister and Food Minister Bilal Yasin many times to discuss and provide subsidy in Sasta Ramazaan bazaars throughout the Punjab. On request of Chief Minister of Punjab Shahbaz Shareef, PPA made a promise with the government to establish the Sasta bazaars in collaboration with the livestock department of Punjab. Therefore, PPA is fulfilling its deed and paying hundreds of thousands of rupees to subsidise Chicken meat and eggs in Sasta Ramazan bazaars on weekly basis. He added that Poultry Association was regularly paying subsidy to the shopkeepers. He mentioned that for first seven days, cheques were paid in three days, adding that payment of subsidy was being made after three days of every week regularly.

Copyright Business Recorder, 2014 Exporters still disappointed: record fisheries worth $367.472 million exported in fiscal year 2014

July 25, 2014

ANWAR KHAN

Pakistan's fisheries export posted a $49.82 million increase hitting historic high of $367.472 million in the outgoing fiscal year 2013-14, but exporters see the growth as 'unsubstantial' to underpin the economy. During fiscal year 2012-13, the country's seafood export stood at $317.652 million. It grew by 16 percent in the outgoing fiscal year 2013-14. However, exporters attributed the growth to export of 'too much' trash fish for chicken meal industries to China.

"Fisheries export for human consumption has decreased with a passage of time," Pakistan Fisheries Exporters Association (Pakfea) Chairman Faisal Iftikhar said, adding that the growth is not substantial enough to make a difference on the world market. In terms of volume: the

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PLP NEWS ALERTS EMAIL No. 172-2014 country's fisheries export went up by 16,991 tons (12.25 percent) to 155,671 tons in the outgoing fiscal year compared to fisheries export of 138,680 tons in the corresponding fiscal year 2012-13, Pakistan Bureau of Statistics said.

Faisal said fisheries growth was largely supported by export trash fish that is caught in illegal nets. "Trash fish export has attracted huge investment in the recent years at the country's largest fisheries sector. The trash fish catch is ever rising that flourished its export," he added. He said the volume of fisheries export, despite hitting a new high, is 'meagre' as compared to the seafood export of other countries like Bangladesh and Vietnam. "Vietnam seafood export posted a growth of $350 million annually while Bangladesh showed an increase of around $150 million," he added.

In June 2014, the country's seafood export mounted by $5.375 million (20.40 percent) to $31.726 million from $26.351 million in June 2013. Seafood export volume surged by 3,242 tons (28 percent) to 14,920 tons in June 2014 from 11,678 tons in June 20-13, the PBS said. "Global increase in seafood per unit price helped the country increase its export value by just $49.82 million and the trash fish export gave rise to its size by 16,991 tons," Chairman Pakfea said, adding that the fisheries sector performance is not encouraging. Pakistan largely exports shrimp of all kinds to world markets, besides fish verities like cuttlefish, squid, Indian mackerel, red snapper, black and white pomfret, etc. Pakistan's major seafood markets are China, Middle East and Far East.

Copyright Business Recorder, 2014 Contamination of Manchhar Lake: Zakat department, BISP to provide funds for relief to fishermen, rehabilitation of lake

July 25, 2014

YASIR BABBAR

Sindh Zakat & Ushr Department and Benazir Income Support Programme (BISP) have pledged financial assistance for the rehabilitation of Manchhar Lake and the fishermen who inhabit in the coastline. They pledge came following the Supreme Court's orders to make the water reservoir free from contamination and rehabilitate those affected by the lake's pollution.

Apart from providing financial assistance to the fishermen, the provincial government started work for arranging mobile health and educational units for the villagers. The plan for rehabilitation of one of South Asia's largest freshwater lakes, includes an environmental survey to ascertain the causes behind the lake's pollution. Zakat department approved funds worth Rs 3.31 million, which will be used for the rehabilitation of 802 affected fishermen families, said a senior officer of the department.

Earlier, Sindh Chief Secretary Sajjad Saleem Hotiana had presided over a meeting regarding taking measures in compliance of the apex court's orders to provide relief to the poor fishermen

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PLP NEWS ALERTS EMAIL No. 172-2014 and rehabilitate the lake spreading over 246 square kilometers. The meeting reviewed installation of five desalination plants to ensure availability of safe and clean drinking water. Sources said that Commissioner Hyderabad Jamal Mustafa Syed told the meeting that the provincial government had contacted BISP's chairperson seeking financial assistance for the affected families.

BISP had assured provision of Rs 50 million for the purpose, he added. Before releasing the amount, however, the provincial government must submit the demographic data of the victims which will be tallied with the fisheries department and the district administration, sources said.

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PLP NEWS ALERTS EMAIL No. 172-2014 Taxation: Pakistan Where further tax is included: taxmen told not to entertain output tax claims

July 25, 2014

The Federal Board of Revenue (FBR) has directed its field formation not to entertain taxpayers' output tax claims, if further tax is included, it is learnt here on Thursday. According to sources, the decision was made after receiving complaints regarding some registered persons, who were involved in claiming further tax deducted from unregistered persons on supplies as part of their output tax.

Replying to a question, sources said that these registered persons were used to including further tax in their output tax claims with the aim to reduce their net tax payments. They said that further tax at the rate of 1 per cent was charged under section 3(1A) of the Sales Tax Act, 1990 on supplies made to unregistered persons.

They said that it was actually the amount payable by the unregistered persons with the objective of incentivising them to get registered in tax net. However, some registered persons making supplies to unregistered persons are claiming further tax as part of their output tax, to reduce their net tax payment. They said that board had now made amendments to section 7 of the Sales Tax Act 1990 to prevent this trend. Moreover, sources said that all tax offices had now been ordered not to entertain taxpayers' output tax claims, if further tax is included besides ensuring the said levy charged from unregistered persons was fully deposited in the treasury.

July 25, 2014

The Federal Board of Revenue (FBR) has empowered the Regional Tax Offices (RTOs) to carry out market surveys and issue directions to trade associations and management of shopping malls/plazas to convince retailers for compulsory registration with the sales tax department.

According to Sales Tax General Order (STGO) 66 of 2014 issued here on Thursday by the FBR, in each Regional Tax Office ("RTO"), in every Enforcement and Collection ("E&C") or Broadening of tax Base ("BTB") Zone having territorial jurisdiction, a cell shall be created for registration of retailers and dealing with allied matters relating to enforcement of the legal provisions. Sufficient number of officers/officials shall be posted in the cell, which will report directly to the Commissioner.

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PLP NEWS ALERTS EMAIL No. 172-2014

The cell will ensure registration of all the first tier retailers, falling within the jurisdiction of that Zone without any delay. For the purpose, the following actions shall be undertaken by the Cell: Firstly, scrutiny of the lists of retailers already circulated by FBR with a view to identify and segregate the retailers falling in the jurisdiction of that Zone.

Secondly, identification of additional retailers required to be registered by obtaining information through other sources, such as territorial surveys, trade directions, internet search, or any other manner. List of persons having commercial connections and total electricity bill exceeding Rs 600,000 in the preceding 12 months (average Rs 50,000 per month) shall be obtained from the electricity supply companies, while lists of all commercial establishments using credit or debit card machines shall be obtained from the State Bank of Pakistan.

Thirdly, the Cell shall approach all retailers liable to be registered but not yet registered, and persuade them for registration, either directly or through their representative associations. Assistance of the management/Association of the shopping mall/plaza may also be obtained for this purpose wherever required written notices may be issued to them requiring them to get sales tax registration immediately. Fourthly, the Cell will provide guidance and assistance to these retailers for filling in the sales tax registration forms.

Fifthly, the Cell would compulsory register those retailers who avoid or resist registration. Sixthly, the Cell will maintain proper records, including lists of retailers, maps, notices issued, replies received and registrations done. After registration, the Cell shall keep monitoring these retailers and encourage them to be tax-complaint, by regularly filing sales tax returns, proper payment of sales tax, installation and proper operation of Fiscal Electronic Cash Registers (FECRs), maintenance of records, etc;

According to the STGO, a new two-tier regime for retailers has recently been created by insertion of sub section (9) in section 3 of the Sates Tax Act, 1990, ("the Act"), and amendment of the Sales Tax Special Procedure Rules, 2007 vide SRO 608(1)/2014, dated 02.07.2014 ("The Rules"). Under this regime, the first tier comprises of retailers of the categories specified in rule 4 of the Rules as indicated, who are required to be registered, shall charge sales tax at the standard rate (or on other prescribed rates such as those provided in SRO 1125(1)/2011 dated 31.12.2011), and otherwise observe the provisions of the normal regime of sales tax. These included a retailer operating as a unit of a national or international chain of stores; a retailer operating in an air-conditioned shopping mail, plaza or centre, (excluding kiosks); a retailer who has a credit or debit card machine; a retailer whose cumulative electricity bill during the immediately preceding twelve consecutive months exceeds rupees six hundred thousand and a wholesaler-cum-retailer, engaged in bulk import and supply of consumer goods on wholesale basis to the retailers as well as on retail basis to the general body of consumers.

The remaining retailers fall within the second tier, and shall be charged sales tax at rates specified in section 3(9) of the Act through their electricity bills. As per rules, the retail chains operating under single ownership (whether individual, AOP or company) require only one registration for all the branches, outlets, showrooms, etc. However it may be ensured that all such branches, outlets and showrooms, etc are mentioned in the registration application and profile. If any branch or outlet is missing, it shall be added by filing Application for Change in Particulars in the prescribed online form.

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PLP NEWS ALERTS EMAIL No. 172-2014 In case of retail chains operating as franchise or other arrangement, where the individual branches or outlets have separate ownership each such branch or outlet requires separate registration Retailers in the first tier are also required to install and operate Fiscal Electronic Cash Registers ("FECRs") of the specifications approved by the Board. For this purpose, it is hereby specified that the FECRs to be installed are used by such retailers may be of any brand or model, provided that they have a tamper-proof transaction-recording mechanism, a secure memory, and internet link to enable data transmission to FBR's database. The already installed FECRs meeting these specifications may continue to be used.

The Cell shall inform PRAL after registration of any retailer of the first-tier. PRAL shall arrange proper configuration of all the FECRs of that retailer for enabling data-link with FBR's database. For the second tier, the RTO shall coordinate with the electricity distribution companies, including DISCOs and M/s K Electric Limited, to ensure that sales tax at the prescribed rates is charged in the electricity bills of all such retailers.

Since the data regarding consumer name and type available with the electricity distribution companies is usually not updated by the consumers despite change in ownership/ tenancy or business use of the premises, the Commissioners have been empowered to issue Exclusion Orders in cases where the consumer is either already registered and paying sales tax or is not engaged in any retail activity at all

In case a consumer, not engaged in any retail activity or already registered and paying sales tax, receives an electricity bill charging sales tax under Section 3(9) of the Sales Tax Act, 1990, he may approach the Commissioner Inland Revenue having jurisdiction for an Exclusion Order.

The Commissioner Inland Revenue, shall issue an Exclusion Order where he receives conclusive documentary evidence and physical verification report, to be retained on record that the consumer is either already registered and paying sales tax or is net engaged in any retail activity.

While issuing an Exclusion Order, the Commissioner shall also examine whether the consumer, although not a retailer, is engaged in any other taxable activity, such as import, manufacturing or supply of taxable goods. IF so, he shall ensure registration of such person in the proper category.

To prevent forgery and malpractices, and to keep a secure record of all Exclusion Orders issued, it is hereby directed that Exclusion Orders containing all essential particulars/details shall be issued only through the computerized system prepared for the purpose and electronically communicated to the concerned electricity distribution company, who shall then ensure that sales tax under section 3(9) of the Sales Tax Act, 1990 is not charged from such consumers. It may be ensured that the entire exercise is conducted in a smooth, efficient and systemic manner, and within the timelines conveyed by the Board. The performance of the officers/officials posted in the E&C/BTB Zones shall be assessed on the basis of their effectiveness in implementation of the above measures, the FBR added.

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PLP NEWS ALERTS EMAIL No. 172-2014 Fuel and Energy: Pakistan Increase in GIDC to push up prices of daily use items

July 25, 2014

N H ZUBERI

Price of daily use items would further go up in the wake recently increased Gas Infrastructure Development Cess (GIDC). The GIDC was enhanced for industrial sector from Rs 100 to Rs 150 and for captive power plants from Rs 100 to Rs 200 in the current financial year budget (2014- 15).

The increase in GIDC for different sectors came in to effect from July 1, 2014 and the same is expected to be charged in the consumers' bills of July, 2014. Such a move, according to sources, would badly hurt the export-oriented industries as their cost of production would shot up manifold. The other industrial consumers would also suffer in the wake in increased GIDC as it will increase the cost of manufacturing, power and transportation sectors.

Sources in the market said that daily use items following levying of GIDC at enhanced rate would amount to dropping a bomb-shell on the people who are already facing the brunt of sky- rocketing prices of essential commodities and high rate of inflation. Salaried class and low- income group people who are already finding it difficult to make their both ends meet would be the ultimate sufferers as they were already facing immense difficulties in managing their household budgets.

Commenting on the situation, Site Association of Industry's (SAI) Chairman Younis M. Bashir apprehended that with the levying of GIDC at enhanced rate not only the country's exports would decline considerably, but the exportable items would also become uncompetitive in the global market.

Terming increase in GIDC `a hard hitting step towards industrial sector', he said that such a move on the part of the government would increase the industries' cost of production as they were also facing immense problems in the wake of utilities' high tariff , prolonged loadshedding, worsening law and order situation, etc. Federal B' Area Association of Trade and Industry's (FBAATI) former chairman Masroor Alvi said that the cost of doing business in the last one year had gone up by about 50 percent due to abnormal increases in gas and power tariffs and other inputs costs.

He said that any raise in gas tariff would further increase the cost of manufacturing because gas is the basic raw material for a large number of industries. He said that since the cost of doing business in Pakistan was going up with each passing day, Pakistani exporters might not get achieve the desired benefits of the GSP plus status as they were not getting a level-playing.

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PLP NEWS ALERTS EMAIL No. 172-2014 More protests likely after Eid against loadshedding

July 25, 2014

Excessive loadshedding has taken the domestic consumers to the streets and more are planning to protest against the prevailing situation after Eid. Already, the residents of Batapur in Lahore had taken law into their hands and created rumpus on the roads. They also attacked the Lesco office.

Industrialists are also highly perturbed over the situation and they, especially those from Faisalabad, will be on the roads to protest against electricity loadshedding after Eid. Majority of the consumers are of the view that the Ministry of Water and Power has failed to manage the situation, as the reported gap between demand and supply is quite manageable.

The Punjab-based textile industry is being exposed to about sixteen hours a day load shedding, forcing the industry to close down manufacturing units partially. This situation has led to unemployment, which is likely to be widened largely after Eid in case if the government failed to provide electricity to the industry.

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PLP NEWS ALERTS EMAIL No. 172-2014 Fuel and Energy: World Brent oil dips below $107, market well- supplied

July 25, 2014

Oil futures prices fell on Thursday, as unseasonably weak demand and plentiful supplies of crude and refined products offset strong Chinese factory data that could boost energy demand in the world's No 2 oil consumer. China's factory activity in July posted its fastest expansion in 18 months as new orders surged, a preliminary HSBC survey showed.

Europe's demand outlook was dimmer. Due to an influx of oil products from the United States, European refiners have been cutting runs or even idling plants at what should be one of the busiest times of the year. This has pressured physical crude prices, with West African and North Sea barrels selling slowly even at bargain levels. "Brent is lower as a function of the fact that we're at peak refinery season and there isn't a lot of demand in the US for Brent quality oil," said Stephen Schork, editor of The Schork Report in Villanova, Pennsylvania. Brent for September delivery fell $1.12 to $106.91 a barrel by 1:33 pm EDT (1733 GMT), after closing 70 cents higher on Wednesday. US crude dropped 1.02 cents at $102.10 a barrel, after gaining 73 cents in the previous session.

"Brent is in contango, reflecting weak demand from European refiners," said Ole Hansen, senior commodity strategist at Saxo Bank. Contango is a situation in which the price of oil for near- term delivery is cheaper than that for delivery further into the future. US RBOB gasoline led the complex lower, down 0.94 percent to $2.833. US Labor Department unemployment data on Thursday suggested that the economic recovery remained on track, with initial weekly jobless claims falling to their lowest level since February 2006. The International Monetary Fund on Thursday chopped its 2014 forecast for global economic growth to take into account weakness early in the year in the United States and China, the world's two biggest oil consumers. Conflicts in Eastern Europe and the Middle East were also keeping a floor under prices, but crude supply from Iraq remains unaffected by fighting in the country. Analysts expect no sustained gains in oil prices unless supply is disrupted, but some say the market has become complacent about the risks. "Oil was overpriced to begin with and now the geopolitical risk is starting to come down, which I think it's healthy for the market," said Oliver Sloup, director of managed futures at iitrader.com in Chicago. In another development, South Korea and Japan have purchased the first condensate cargoes to be exported from the United States since the easing of a 40-year ban on US crude exports.

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PLP NEWS ALERTS EMAIL No. 172-2014 Iraq oil exports dip after jihadist offensive

July 25, 2014

Iraqi oil exports dipped in June, the oil ministry said on Thursday, as violence hindered output from its northern fields. Islamic State (IS) insurgents took control of large parts of Iraq's north and west in a sweeping offensive that began on June 9, preventing Baghdad from exporting oil via a pipeline to Turkey and by road to Jordan.

Exports totalled 2.42 million barrels of oil per day in June, the oil ministry said, falling far short of a budgeted projection of 3.4 million bpd. The dip adds to the woes of Iraq, which is heavily dependent on oil revenues while spending more on military equipment to battle the IS.

Oil ministry spokesman Assem Jihad said June exports generated revenue of $7.47 billion, or $600 million less than in May, despite higher oil prices. As Opec's number-two oil producer, Iraq's 11 percent of proven world reserves plays a key role on world markets and prices after violence disrupted oil exports from Syria and Libya.

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PLP NEWS ALERTS EMAIL No. 172-2014 Banking & Finance Pakistan’s liquid foreign reserves reach $14.45 billion

Thursday, 24 July 2014 18:30

Posted by Imaduddin

reserves held by the country stood at US$14,450.2 million on July 18, 2014.

Giving the break-up of the foreign reserves position, a statement of the Central Bank issued here Thursday said that Foreign reserves held by the State Bank of Pakistan stood at US$ 9,398.8 million while the net foreign reserves held by banks were US$ 5,051.4 million on July 18.

During the week ending July 18,2014, SBP's Liquid FX Reserves decreased by US$87 million to US$9,399 million compared to US$9,486 million in the previous week.

During the week ending July 18, 2014, SBP has made payments of US$ 69 million on account of external debt servicing and other official payments.

The SBP did not receive any significant inflows during this week, the statement said.

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PLP NEWS ALERTS EMAIL No. 172-2014 Markets 232 fined during crackdown against profiteering

Thursday, 24 July 2014 13:30

Posted by Parvez Jabri

KARACHI: As many as 232 profiteers were challaned and an amount of Rs 490,700 was recovered in term of penalties from them during the ongoing crackdown to check the illegal profiteering through sale of essential commodities on excessive prices in violation of the officially approved price list.

This was said by Commissioner Karachi Shoaib Ahmed Siddiqi, said a statement on Thursday.

He said that the profiteers were challaned in the areas including Saddar, Civil Line, Garden, Site, Baldia, Ferozabad, Jamshed Quarters, Gulshan-e-Iqbal, Bin Qasim and Korangi.

Shoaib Siddiqi said that total 54 milk sellers, 66 fruit vendors, 49 vegetable merchants, 19 food items grocers, 38 chicken sellers and five flour sellers were challaned for selling the commodities on excessive prices.

The Commissioner Karachi has directed the officials concerned to control prices and ensure the sale of daily commodities in accordance with the notified price list to provide maximum relief to the people.

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PLP NEWS ALERTS EMAIL No. 172-2014 BR Research: All PML-Ns subpar report card

July 25, 2014

BR Research

Its not looking pretty for the ruling party at the center. The Islamabad-based free-market think tank, Prime, has just released its 3rd tracking report of the PML-Ns economic agenda, which reflects only modest economic achievements relative to the great promises made in the partys manifesto.

The PML-N has scored 4.84 out of 10 in implementing its economic promises, which Prime equates to a 48.4 percent success rate. One can use the glass half-full or half-empty simile here; but the breakdown of this score suggests a worsening manifesto implementation status in Apr- Jun compared to that in the previous, Jan-Mar report.

For background, the institute has identified and studied 82 targets mentioned in the PML-N manifesto and clubbed them into three areas of economic revival (57 targets), energy security (22 targets) and social protection (3 targets). Each target received a value from 0 (lowest) to 10 (highest). Targets are analysed in terms of three parameters of policy and legislative development (maximum 2.5 points), institutional reforms (maximum 2.5 points) and implementation (maximum 5 points). Simple mean rather than weighted average is used to measure score under each area.

PML-N has received a score of 4.33 under economic revival. Energy security is scored at 3.93, while social protection is rated at 6.25. All three averages have declined compared to previous quarterly report. Perhaps thats why this quarter the report is titled, Succumbing to the Temporal, urging the federal government to get its act together on the needed reforms.

Prime suggests that the PML-Ns economic agenda is "somewhat on the right track...... However the failure to implement vital economic reforms is taking its toll." Ali Salman, Primes Executive Director appreciated the reduction in government borrowing, launch of major infrastructure projects, and uptick in privatisation, but he remained apprehensive about governments ability to control circular debt and usher in energy sector reforms.

Encouragingly, the think tank also introduced a provincial tracking report. Currently, Khyber- Pakhtunkhwa, Punjab and Sindh governments are under the radar. The methodology is the same, only the number and nature of targets-clubbed into nine broad areas that are relevant for provincial economic governance--differ across provinces.

As the illustration shows, PML-N government in Punjab performed better than PTI government in KP, while the PPP government in Sindh finished last. KP government has done relatively better than its peers in following through on its promises in the fields of health and education-- two of the most important domains following 18th Amendment.

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PLP NEWS ALERTS EMAIL No. 172-2014 Punjab has done relatively better than the rest in areas of transportation, housing and e- governance--that seems in conformity with the high budgetary allocations for the former two and the Chief Minsters push for the latter.

Sindh has outperformed others in agriculture and livestock. But its education score is abysmally low compared to the rest.

All three provinces have fared poorly in areas of taxation/resource mobilisation, and labour/human resources. All three provinces scored below 5, signifying elow average provincial performances.

Next provincial tracking report is due in December; maybe, this situation will improve.

Primes work provides a good look into how well political parties are keeping their economic promises over time. But these findings must be consumed with a grain of salt, for the report relies entirely on secondary data (newspaper reports and publicly available economic data).

Secondary data-dependence risks are overlooking the developments that have been unreported or under-reported in media. Lack of credible secondary research data is the reason behind Balochistans exclusion from the provincial report. Similarly, governments claims appearing in the media cannot be taken at their face value--some form of ground research can help resolve this issue.

Primes position is that the usage of publicly-available data is more objective and credible. To the extent of economic statistics (e.g. finance ministrys budgetary spending and central banks macro statistics), that argument is fine. But claims of "qualitative" progress may not measure up to scrutiny all the time.

Secondly, political parties design manifestos with Federal Government in mind. Arguably, parties would have a different "promise" approach and timeline for strictly provincial manifestos. But thats not Primes fault-- it has actually done well to glean so many provincial targets from essentially Federal manifestos. One hopes parties would give serious thought to compiling provincial manifestos as well in future elections.

In any case, Prime is keeping up the good work and its team must be appreciated for its efforts to make an informed economic discourse possible.

The message is clear in these two reports: while Federal Government must not let mid-term inertia get in the way of difficult reforms; the provinces will also be subject to greater examination, thanks to their constitutional mandates and current political dynamics.

======PML-Ns economic hits and misses so far* ======Target Score**Apr-Jun Jan- Mar ======Economic revival ------Infrastructure projects 7 5.5

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PLP NEWS ALERTS EMAIL No. 172-2014 33% reduction in current expenditures 2 2.5 Limiting govt borrowing 8 8.5 Improving regulatory environment 2 4 Bringing informal economy to tax net 2 - Reforming tax administration 1 - Completing privatisation process 7.5 6 ------Energy security ------Reforming Nepra 4.25 4.5 Reforming Discos 5.83 2.83 Creating a wholesale electricity market - - Rationalising gas tariff - - Permanent elimination of circular debt 3.63 3.25 Setting up of coal and LNG import terminal 5 3.5 ------Source: Prime 3rd tracking report (Apr-Jun). ======* = Selections from 82 targets. ** = Range from 0-10. Simply,a score above 5 is good; below 5 is bad. ======Modest(y) returns at FFC

July 25, 2014

BR Research

Growing top line was considered a guarantee for a growing bottom line, not very long ago, for the local fertiliser market leader Fauji Fertilizer Company (FFC). The top line growth has now confined to single digits, as flattish prices and static volumes have left little room. The bottom line, though, continues double-digits shift, but sadly on the wrong side for the urea giant.

With every quarter passing by, FFCs gross profit margins are getting modest. From the abnormal highs of E&P-esque 60 percent gross margins, the journey down to earth has been a real swift one. The main reason is that FFC has lost to a great extent, what once used to be its biggest weapon--its pricing power.

FFCs pricing power was tested earlier this year, and the governments intervention leading to a middle ground brought an end to a decade-long history of strong pricing power. FFC will now have to learn to live with tighter margins and be ready for more government interventions, should there be more upwards cost pressure from the raw material side.

Faujis bottom line has for a long time been strongly supported by other income contribution, mainly from its sister concern FFBL. Too bad, that FFBL has not been in the best of shapes of late, and the near future does not appear too bright either. Lilted wonder then, that FFC like its peers, is eying investment options, everywhere.

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PLP NEWS ALERTS EMAIL No. 172-2014 FFC can still hope to benefit from the ongoing industry situation. Engro, in case of delay in court proceedings, is likely to increase urea price, having been hit by uniform GIDC for all its plants. FFC, like yesteryears, can pounce on the opportunity and boost primary margins, for whatever period it lasts.

Fundamentally, the company is still strong. Don forget it had doubled its profits in three years-- so a slight dip is not all that horrendous. And the payout remains strong enough for its dividend- yielding safe-bet status to be intact.

======FAUJI FERTILIZER COMPANY ======Rs (mn) 2QCY14 chg 1HCY14 chg ======Sales 18423 2% 35997 5% Cost of sales 11588 22% 21679 20% Gross profit 6835 -20% 14317 -12% Gross margin 37.1% 39.8% Distribution cost 1534 -6% 3025 4% Other income 281 -43% 1817 -9% PAT 3603 -21% 8161 -14% EPS (Rs) 2.83 6.41 ------Source: KSE notice ======Pakistans recreational mix

July 25, 2014

BR Research

Statistics aren always the best way to reflect on a nations recreational habits. But sometimes, numbers offer some food for thought.

The social sector statistics maintained by Pakistan Bureau of Statistics show that an increasing number of Pakistanis are now stepping out of their homes for fun. For instance, visits to archeological and heritage sites and museums have been increased by 165 percent since 2008 to reach 1.97 million in the year 2013. Most of the visitors are from Punjab because of its high population and the fact that several major archeological sites are found in the province. Similarly, zoo visitors have grown 29 percent from 2008 to reach 9.8 million in 2012.

With a rising urban middle class and a significant 18-35 age-group, one sees jam-packed restaurants and cafés in all major cities. However, data on restaurant visits is not available. One also sees huge traffic at cinemas, but attendance estimates are not published. One thing that we do know is that the last decade has been very harsh on cinema houses, possibly due to growing internet penetration that has brought movies to every room, or due to growing security threats or both.

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PLP NEWS ALERTS EMAIL No. 172-2014

From 376 cinemas in 2003, only 86 were left standing in 2012, as per PBS data. Cinemas have been shut down in all provinces, with Punjab having 60 cinemas, Sindh 15, KP 10, and Balochistan just one by the end of 2012. Cinema seating capacity has accordingly gone down by 81 percent in this period to 43,300 people. No wonder the eleventh-hour bookings usually end up in disappointment.

The closure of cinemas, however, also corresponds to the decline in the films released. Local film releases had nearly halved to 22 in 2012 from 43 in 2003. Interestingly, while local Urdu films have disappeared and Punjabi film releases have reduced during this period, Pushto film production has increased. Nearly two thirds of local films released in 2012 were Pushto, a number which sort of runs contrary to the perception of Talibanisation of Pashtons.

Television is a source of recreation for many. But the production of TV dramas and plays has gone down in this period. The PBS data show that since 2001, new productions had gone down by 39 percent to 420 dramas and plays in 2012. Similarly, radio production had declined by 45 percent to 75 dramas and plays in this period. Viewer attention has seemingly been captured by dozens of news channels that have come on air during this period and retained eye balls through their live coverage and political talk shows.

As for newspapers, there were 324 news dailies in 2012, almost double the number in 2001, thanks to strong growth in all provinces except Sindh. But "pleasure reading" is arguably much more recreational in nature. Increasingly, book stores are fetching new books from abroad sooner compared to the past, which shows rising interest in reading for fun. But, again, precise data is hard to find here.

Domestic tourism is another good indicator of effectively utilising leisure time. In recent years, one notices an uptick in local trips to northern areas, mostly undertaken by young groups. A local tourism expert, however, suggests that 2013 remained a bad year for tourism in Pakistan due to macabre tales of security breakdown across the country. But, law-and-order is not the only issue.

"We have not paid serious attention to facilitate our own domestic tourists. There is a large number of Pakistanis who are interested to explore their own homeland. But the dilapidated tourism infrastructure and high cost of boarding and lodging, coupled with poor standard of services at tourist spots discourage them to do so," he laments.

Beyond these, there are other recreational avenues as well. But it can be said that law-and-order issues have affected the societys recreational appetite. One hopes the situation improves soon and there is resurgence in domestic tourism. Targeting ease of doing business

July 25, 2014

BR Research

In a recent development, the Board of Investment (BoI) has prepared a business improvement plan with the objective of ensuring a more conducive business environment. Going by the news,

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PLP NEWS ALERTS EMAIL No. 172-2014 the governments commitment to improving the business climate is related to the IMFs EFF. Subsequently, BoI was asked to lead the formulation of a plan, with a technical committee constituted to work on Ease of Doing Business (DB).

There are a few important qualifications to be made here though. First, if the DB rankings are being used as a benchmark to gauge improvements in the business environment, then the rankings limitations have to be acknowledged.

For example, issues like the quality of infrastructure services, security of property from theft and looting, transparency of government procurement, and macroeconomic conditions or underlying strength of institutions are not directly studied by Doing Business.

Needless to say, many of these aspects have time and again been highlighted by investors and commentators alike for having shooed away even established businesses from the country. Similarly, internal security and law and order are being increasingly cited as important factors hindering business development.

Secondly, while the concerted focus on a select few indicators is understandable (these include starting a business, dealing with construction permits, paying taxes, trading across borders and enforcing contracts), one cannot discount the importance of the other indicators which require just as much attention. These include, getting electricity, registering property, getting credit, protecting investors and resolving insolvency.

In fact, Pakistan has much lower ranking in two of these: getting electricity and registering property. As far as the benchmark rankings are concerned, all the indicators carry equal weight in the rankings.

Third, the pilot project is to be run in Karachi during the initial phase of the plan. However, business dynamics differ remarkably across the country, even though Karachi may have the highest business quantum. With the parameters already available in the form of DB indicators, the pilot can be extended to other districts that constitute the countrys sample. This way, a national business needs-assessment can also be pursued simultaneously.

Pakistans position in the World Banks 2014 DB rankings has come down to 110 from 106 a year before. Evidently, the governments pro-business stance itself is not enough in the face of DB challenges. While the governments intent may well be clear, only time will tell whether it has the capacity to rejuvenate business development and economic growth as it is proclaimed. Towards that end, the BoI exercise is a start!

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PLP NEWS ALERTS EMAIL No. 172-2014 Brief Recordings President Sarhad Chamber of Commerce and Industry explains how Pakistan lost Afghan market to Iran

July 25, 2014

In this interview with BR Research, Zahid Ullah Shinwari sheds light on how businesses have fared in Khyber-Pakhtunkhwa over the last many years of war on and beyond its western borders. Shinwari, a graduate from Islamia College Peshawar, also talks about Pak-Afghan trade as well as Afghan transit trade and how Pakistan lost the Afghan market to Iran. Below are selected excerpts from the interview:

BR Research: How is Khyber-Pakhtunkhwa's situation in terms of trade and business?

Zahid Ullah Shinwari: With little or no agricultural activity in Khyber-Pukhtunkhwa, Peshawar has long been a hub for trading activities, and a gate way for trade caravans from Afghanistan and Central Asia. Due to locational disadvantage and ensuing high cost, the province's industrial base has not been strong-footed. Of the 2,000 industries that have been set up in KP in the last 60 years, only 700-800 remain operating.

The dynamics of the province completely changed with the Russian invasion of Afghanistan in late 1970s, with trade being the first casualty; that marked difference in the province's economy came with huge refugee influx, drug and weapon culture, illicit money, smuggling and social disparities, all of which prevail to date.

There was some stability in the post-war era after the 9/11 incident where major international changes took place in Afghanistan; reconstruction and rebuilding process began with $100-200 billion dollars flowing into the Afghan economy, creating several jobs and business opportunities. But, unfortunately, Pakistan could not benefit much; exports touched $2.3 billion, which are peanuts.

In short, if Pakistan has been a frontline state in fighting terrorism, KP has been the frontline province. That has damaged the province's economy, and brought industrialisation to a halt. Retail sector and consumerism has been significantly affected by frequent bomb blasts and extortion cases. A major flight of capital has taken place to other parts of the country, particularly Lahore and Islamabad, and to other parts of the world like Dubai, Malaysia, Europe and the USA.

BRR: How has been the Federal Government's response to these problems?

ZS: We were given a three-year Prime Minister Relief Package in the last government. The relief was in terms of a 50 percent reduction in sales tax, exemption in income tax, a fixed mark-up of 8 percent, a write-off in agricultural loans and utility bills of the most-affected areas. With that

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PLP NEWS ALERTS EMAIL No. 172-2014 package finishing in 2012, we deserve a similar package even more today.

BRR: How do you think the US exit from Afghanistan beyond 2014 will affect KP and the region at large?

ZS: There is tremendous uncertainty right now. On one hand, public sentiment has gone down drastically fearing the reemergence of chaos that existed before the 9/11 incident and before US entered Afghanistan. Exports have seen a further decline of $1 billion, while all major projects have been shut down in the last one and half year. Investment has plunged and displacement of population has started once again.

On the other hand, some view that the vulnerable times are over. A lot needs to be done in Afghanistan whether it is housing, construction or any other sort of development, which will lead to a boom in the economy.

BRR: What are the key issues in trade with Afghanistan?

ZS: The real problem lies with our policymaking. There are many hurdles and self-created problems especially in the exports and bilateral trade with Afghanistan. Transit trade agreement has always been wrongly treated in the country. By international law, a land-locked country requires a facility to access transit, but in Pakistan this has been treated with unnecessary checks, valuations and securities that have affected the willingness of the neighbouring country to conduct bilateral trade with Pakistan.

While normal exports, which include export refunds and rebates is allowed, trade of certain items with Afghanistan is not allowed under DTRE and Manufacturing Bond. Over and above this, another hurdle for export policy is the SRO-192, which states that the proof of arrival of all consignments to Afghanistan via EPZ, DTRE, manufacturing bonds and normal exports has to be shown to the government of Pakistan by providing customs clearance documents of Afghani importer inside Afghanistan. This is illegal and discourages our exports to Afghanistan. On the infrastructure side, we have failed to develop dry port; we have also failed to develop customs station Torkham and the related road groundwork.

Afghanistan now has erected strict transit trade conditions like 110 percent cash security, cross- border documentation, endorsement of Central Asian trade agreement from the Afghan Embassy, and setting up of a local Afghani company for transit trade with Central Asia.

BRR: To what extent has Iran chipped off Pakistan's share of exports to Afghanistan?

ZS: Iran has taken quite a substantial share. Aside from cement, a major portion of synthetic paints market in Afghanistan that used to be completely with Pakistan has now been taken over by Iran. Ninety percent of polymer and plastic product export of Pakistan has been captured by Iran. Iran has surpassed us in confectionery and food items due to relatively high cost of business here.

Similarly, 70 percent of transit trade has already shifted to Iran, which was only 10 percent eight years ago. India has established a modern seaport at Chabahar and link road to Herat city, beside the traditional Bandar Abbas port, which directly resulted into shifting of our business and trade to Iran. Moreover, Indian and Central Asian exports have also made inroads into Afghanistan.

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PLP NEWS ALERTS EMAIL No. 172-2014

BRR: Since Afghanistan is gateway to Central Asia for Pakistan, have Pak-Afghan transit trade issues affected Pakistan's potential with Central Asia?

ZS: The hurdles in trade with Central Asia are similar to what we face in Afghanistan. Right now, we do not have any trade agreement with Central Asia, which is our drawback. We need a trilateral trade agreement between Pakistan, Afghanistan and Tajikistan. The potential from Central Asia is more than $25 billion within two-three years if a trilateral trade agreement in invoked between the three countries, which will be a gateway to other Central Asian countries all the way to Russia via the railroad infrastructure.

Though there are expectations that such a trilateral agreement will be signed in the near future, the US withdrawal, and the subsequent situation in Afghanistan continues to be a source of uncertainty.

BRR: What energy sector challenges does KP face; what is the potential?

ZS: The potential for hydro-power generation in the province is around 25,000-30,000MW, but we have not been able to tap even 2,000MW. We have some good hydro-power projects. But, they are plagued with issues in IRR and red-tapism in tariff determination. Additionally, we cannot benefit from the wheeling charges for selling our electricity to third party as nothing has been done in this regard even though this is allowed as per the rules and regulations. If wheeling is pursued forward, it has immense potential to attract huge international and local investment.

BRR: How true is this perception that loans are not being disbursed in KP of late?

ZS: KP has been officially declared as a full-risk zone. Even though the default rate of the province is one of the lowest in the country and the province is generating a significant amount in bank deposits, less than one percent of the total advances by the banking sector end up as loans in KP.

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PLP NEWS ALERTS EMAIL No. 172-2014 Crime Records Attock: 36 suspects held in crackdown

ATTOCK: Police started crackdown on anti-social elements and arrested 36 suspects during one week. Sixteen suspected people were booked for having illegal arms while 14 were booked for possessing narcotics.

Similarly, cases were also registered against six foreigners. Under supervision of DPO Israr Ahmed Abbasi, the crackdown is underway across the district, police sources said. 9 Afghans held in Quetta

QUETTA: At least nine Afghans were held at the border town of Balochistan, FIA sources said on Wednesday. They said that the Afghan nationals were detained at the Friendship Gate in Chaman Qila Abdullah district. They did not have travelling documents. Rawalpindi: Man held carrying heroin to Italy

RAWALPINDI: Pakistan Customs foiled a bid to smuggle heroin to Italy and arrested a drug smuggler, informed sources here on Wednesday.According to the sources, Pakistan Customs stopped a passenger, who was later identified as Ziad bin Shaukat, bearing passport (TS5517994), on suspicion. During the course of his luggage search, the Customs officials found 450 grams brown heroin that was concealed in cigarettes sleeves. The passenger was arrested on the spot when he was trying to board a Rome-bound Qatar Airways flight number QR-615.

The sources claimed that the Airports Security Force (ASF) had earlier cleared the baggage of the passenger after scanning. A case has been lodged against the accused.

Meanwhile, Anti-Narcotics Force (ANF) conducted several raids in various cities and arrested 11 drug peddlers including three lady smugglers besides recovering huge quantity of narcotics from their possession. Muzaffargarh: Huge quantity of liquor seized

MUZAFFARGARH: Ali Pur City police on Wednesday claimed to have arrested a man and recovered 4,000 bottles of liquor from his possession.

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PLP NEWS ALERTS EMAIL No. 172-2014 According to the police, on a tipoff, the city police raided a house near the Eidgah Chowk and arrested “a drug pusher identified as Raoof Sial while his two brothers Naveed and Waseem managed to escape”. The police also recovered about 4,000 bottles of liquor from his possession. Nankana Sahib: 5 held with dead animals’ meat

NANKANA SAHIB: Mangtanwala police and the Livestock Department officials on Wednesday arrested five people for carrying dead animals’ meat. On a tip-off, the police intercepted a vehicle and found 14 maunds dead animal’s meat. The police also arrested Farooq, Alam, Asghar, Asif and Imran. Karachi: 9 shopkeepers arrested; 199 fined

KARACHI: The city administration arrested on Wednesday nine retailers and fined another 199 profiteers from different parts of the metropolis for violating the official price list. Those fined included 57 milk sellers, 14 grocers, 27 chicken sellers, 57 green grocers, 39 fruit sellers and four flour millers.

A concerned official sharing details of the campaign said the commissioner who initiated the crackdown imposed a fine of more than Rs 400,000, on Tuesday, on those selling essential food items on high rates. Pakpattan: Man booked in fake cheques

PAKPATTAN: Police on Wednesday booked two fraudsters in separate incidents here. Accused Safdar gave a fake cheque of Rs 465,000 to Muhammad Akmal, which was bounced by the concerned bank. Accused Mazhar Muneer gave a bogus cheque of Rs 60,000 to a man, which was bounced by the bank Daska: Women gang-raped at gunpoint

DASKA: Two women were raped in separate incidents in Daska tehsil here. In village Bakhapur-Motra, Riffat, a married woman, was allegedly gang raped by Iftikhar Ahmed and another person at gunpoint at her home. Accused fled away. Motra police have registered a case with no arrest.

In village Musalmaniyaan-Bambaanwala, Bushra Bibi’s young daughter Anam was raped at her home by local vagabond Asif alias Asu. She was alone at her home, when the accused forced her entry and allegedly raped her.

Moreover, old enmity claimed three lives as they were gunned down in two separate incidents in Daska tehsil. In village Sandhaanwala-Daska, two cousins Babar Ali and Muhammad

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PLP NEWS ALERTS EMAIL No. 172-2014 Boota were shot dead by four armed accused over an old enmity. Bambaanwala police have registered a case against accused Mehboob Ali, Inayatullah, Naseeran Bibi and Jalal with no arrest so far.

In Daska City’s congested Machchali Bazaar, three motorcyclists shot dead a youth Shahid Gujjar over an old enmity when he was sitting at his shop. Accuse fled away.

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PLP NEWS ALERTS EMAIL No. 172-2014 Miscellaneous News National schemes: Savings mobilisation declines 49% in FY14

By Kazim Alam / Creative: Asad Saleem

Published: July 25, 2014

KARACHI:

Savings mobilised under the National Savings Schemes (NSS) in 2013-14 amounted to Rs196.4 billion, which is almost half of savings mobilisation achieved during 2012-13.

According to data released by the State Bank of Pakistan (SBP) on Thursday, savings mobilised under the NSS during the last fiscal year were 49% less than the mobilisation of Rs386 billion recorded in 2012-13.

In June alone, the amount of savings in a number of schemes under the NSS umbrella clocked up at Rs22.2 billion, which is 56.3% less than the comparable figure of Rs51 billion recorded in June 2013.

Analysts believe the substantial drop in savings mobilisation in the last fiscal year is because of the unusually high savings recorded in 2012-13. In other words, the decline in savings under the NSS in 2013-14 appears substantial because of the high-base effect.

Savings mobilisation recorded a rapid increase in 2012-13 when it surged by a massive 105% to Rs386 billion from Rs188.3 billion in 2011-12.

NSS mobilisation in 2012-13 had increased substantially when interest rates declined in the wake of the SBP’s lowering of the discount rate.

But the central bank raised the discount rate twice by 50 basis points each in the first half of 2013-14 and then kept it flat at 10% for the rest of the fiscal year. This led to higher interest rates in the economy, thus resulting in slower mobilisation of savings under the state-run NSS during 2013-14.

Savings mobilisation under the NSS remained Rs224.7 billion in 2009-10, Rs234.9 billion in 2010-11, Rs188.3 billion in 2011-12, Rs386 billion in 2012-13 and Rs196.4 billion in 2013-14. This translates into a compound annual growth rate of a negative 3.3% per annum for the last four fiscal years.

The decline in NSS mobilisation in recent years is arguably a positive development for the country. Government borrowings under the NSS are categorised as ‘unfunded debt’ and should thus be minimised. According to the Ministry of Finance, the share of unfunded debt in the government’s total domestic debt stood at Rs2.2 trillion, or 21%, at the end of March.

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PLP NEWS ALERTS EMAIL No. 172-2014 During the first nine months of the outgoing fiscal year, most of the incremental mobilisation went into Bahbood Savings Certificates (Rs41 billion) and Regular Income Certificates (Rs34 billion).

The government last revised the rates of return on the NSS on January 1. Bahbood Savings Certificates now offer a return of Rs14.04% per annum while the interest paid on Regular Income Certificates is 11.88% per annum.

The government has also linked profit rates on major NSS instruments with the yield on Pakistan Investment Bonds besides imposing withholding tax on profits and service charges/penalty interest on early redemption.

Published in The Express Tribune, July 25th, 2014. Tapping hydrocarbons: Oil production hits record high at 98,000 bpd

By Our Correspondent

Published: July 25, 2014

KARACHI:

Pakistan’s average oil production jumped 13% to 86,000 barrels per day (bpd) in fiscal year 2013-14 compared to a year earlier with petroleum exploration companies benefiting from higher price gains, a brokerage house said on Thursday.

The oil output even reached an all-time high of 98,000 bpd by the end of June 2014, up 22% compared with 80,000 bpd pumped out in June 2013, said Vahaj Ahmed, an analyst at Topline Securities.

“Average (gas) production during the year dropped 2% to 3,984 mmcfd (million cubic feet per day) versus 4,081 mmcfd. Hence, cumulative hydrocarbon production in Pakistan dropped by an average of 1% to 796,000 barrels of oil equivalent per day (boed),” he said in a report.

Gas production was marginally up 2% to 3,904 mmcfd at the end of fiscal year 2013-14 versus 3,826 mmcfd at its start.

Since net realised prices on oil sales were five times higher than that for gas, revenue growth from the increase in oil output outweighed the loss from the decline in gas production for the exploration and production companies, he said.

With 26% growth in average oil production and 3% higher gas output, cumulative production of Pakistan Oilfields (POL) rose 9% to an average of 20,000 boed versus fiscal year 2012-13.

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PLP NEWS ALERTS EMAIL No. 172-2014 It benefited mainly from additions in the Tal block, in which it enjoys a 21% working interest. Average oil production rose 63% to 17,000 bpd in the block, which contributes 20% of total oil produced in Pakistan.

Production from three new fields – Mamikhel-2, Maramzai-2 and Makori East-3 – helped POL to offset the decline in Manzalai.

On the other hand, Oil and Gas Development Company (OGDC) saw a 2% decline in its output, which was around 252,000 boed compared to 257,000 boed in previous year.

Pakistan Petroleum Limited (PPL) recorded average production of 160,000 boed in fiscal year 2013-14, down 6%, the report said.

Industry officials believe that Pakistan’s crude oil output is expected to increase to 130,000 bpd in one or two years, a sharp rise from the stagnant 66,000 bpd seen in the last few years.

While there remains uncertainty over the exact size of oil reserves in the absence of any broad geological survey, Pakistan has estimated recoverable reserves at 27 million barrels.

The petroleum industry generally believes Pakistan’s geology is gas-prone rather than having any substantial oil potential. The fact that companies have to drill deep wells to find hydrocarbon reserves adds credence to this argument.

Higher oil production does not mean it will help the balance of trade substantially since the country spends a lot on importing petroleum products like diesel and furnace oil.

Published in The Express Tribune, July 25th, 2014. Future projection: IMF sees 13% depreciation of Pakistani rupee

By Shahbaz Rana

Published: July 25, 2014

ISLAMABAD: The International Monetary Fund has taken into account the rupee-dollar parity at Rs113.7 to a dollar while making projections for the current fiscal year – a rate that implies over 13% depreciation of the Pak rupee against the greenback.

Though the Washington based lender has not explicitly stated the exchange rate in its latest report on Pakistan, the projections for the current account deficit and the nominal size of the economy suggest that it considers the rupee as overvalued.

The average exchange rate for the current fiscal year is being worked out at Rs111.4 to a dollar by the IMF.

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PLP NEWS ALERTS EMAIL No. 172-2014 The IMF also raised a red flag over the appreciation of the nominal exchange rate during the last fiscal year and stressed that a more flexible exchange rate will help State Bank of Pakistan to better reach its reserves objectives.

Currently the rupee is traded at Rs98.725 to a dollar while for the fiscal year 2014-15 the government has expected marginal depreciation of the rupee against the US dollar. The IMF’s report on third review of Pakistan’s economy suggests that the IMF values Pakistan’s rupee at Rs113.7 to a dollar.

Commenting on IMF’s projection Dr Ashfaque Hasan Khan, a renowned economist and member of government’s Economic Advisory Council (EAC) said the forecasts of balance of payments and imports and exports are based on Rs113.7 to a dollar exchange rate and if this rate is not materialized, the Fund’s all projections would go wrong.

During the last fiscal year, the IMF had claimed that Pakistan’s rupee was overvalued and worked out its value at around Rs114 to a dollar. After initial depreciation, the State Bank of Pakistan (SBP) and Ministry of Finance managed to bring down the parity to around Rs98 to a dollar. The average exchange rate during the last fiscal year remained at Rs102.8 to a dollar.

According to analysts, a strong rupee may dent the government’s export target of $26.9 billion but it will help contain inflation.

They added the rupee depreciation will increase the prices of oil and electricity, which the government may not afford at a time when it has failed to ensure power supplies despite massively increasing tariffs.

In its report released this month, the IMF staff noted that greater willingness on part of Pakistan to accommodate downward exchange rate flexibility could play an important role in accelerated reserves accumulation, while helping boost exports over time.

The report stated that although recent grants of $1.5 billion from Saudi Arabia and the successful $2 billion Eurobond issue have eased foreign exchange market pressures and have begun to alleviate balance of payments crisis concerns, the IMF staff suggested that the SBP should not place its bets on one-off inflows.

In addition, it further advised that the central bank should align monetary and exchange rate policy to further boost reserves.

The country’s total foreign currency reserves slightly dipped to $14.45 billion including $9.398 billion held by the SBP.

The report also said that while the SBP agreed with IMF that one of the major challenges faced by the economy is to build foreign exchange reserves, the central bank differed with its assessment of an overvalued rupee.

The IMF said the SBP understood that higher interest rates could help attract private inflows to finance the current account deficit, but believes that currently the current account deficit was low and the main deterrent to private inflows was not the interest rate.

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PLP NEWS ALERTS EMAIL No. 172-2014 “(Pakistani) authorities do not share IMF staff’s view that the exchange rate is somewhat overvalued, and place greater priority on the nominal exchange rate stability”, said the IMF.

Published in The Express Tribune, July 25th, 2014. Bestway buys 76% stake in Lafarge Cement

By Farhan Zaheer

Published: July 25, 2014

KARACHI:

Bestway Cement Limited on Thursday announced the acquisition of 76% stake in Lafarge Pakistan Cement Limited at an enterprise value of $329 million (Rs32.57 billion), according to a company notice sent to the Karachi Stock Exchange (KSE).

The deal, if approved by regulators, would make Bestway Cement the largest cement manufacturer in Pakistan with a capacity of 8.3 million tons. The deal settles the equity value of the company at Rs28.46 billion (Rs19.55 per share).

But the deal has sparked fears of a price war among big cement-makers who are arguing with each other over capacity expansion plans.

“The market saw a mixed reaction to the deal. Others think this may break the cement cartel, some say it will not,” said Standard Capital Securities analyst Saad Hashmi. “Whatever is the outcome, it is clear that the cartel is not going to break in one and a half years. Companies will avoid price war as it will hurt all.”

DG Khan Cement, one of the leading cement-makers, was said to have been the frontrunner for the acquisition. After the news of Bestway acquiring Lafarge emerged, the cement sector on the Karachi bourse posted losses.

This takeover by Bestway is also negative for the sector’s sentiments in the immediate term because of DG Khan’s likely expansion in the country’s south. Hence, its expansion might cause a domino effect resulting in an aggressive expansionary drive in the sector and a price war, BMA research said.

“The price war is unlikely during the gestation period of the expansionary wave. The prospect of a potential price war is likely to be price dampener where the sector is likely to remain under pressure in the near term,” the report said.

Similarly, AKD Securities analyst Bilal Alvi told The Express Tribune that the price war threat was not going to hurt the industry in the near future until new capacity expansion was undertaken by big players.

An expected 10% per annum growth in local sales and 5% per annum decline in exports will take the industry towards 100% capacity utilisation by fiscal year 2018. This should reduce the

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PLP NEWS ALERTS EMAIL No. 172-2014 rationale for companies to indulge in price war to gain market share since additional capacities can cater to increasing demand.

In case a price war emerges, it may not last long. The previous price war lasted for five to six months in fiscal year 2010 during which retail cement prices fell 23% while volumes rose 16% year-on-year.

Published in The Express Tribune, July 25th, 2014. Corporate results: Fauji Fertilizer produces Rs8.2 billion profit

By Our Correspondent

Published: July 25, 2014

KARACHI:

Fauji Fertilizer Company (FFC) has posted a net profit of Rs8.2 billion in the first half of the calendar year 2014 (1H CY14), down 14% compared to Rs9.5 billion in the same period of previous year.

Earnings per share (EPS) remained Rs6.41 in the 1HCY14 against an EPS of Rs7.46 in the same period previous year.

Despite the company clocking in its lowest offtake for 16 months in April 2014, the topline of FFC grew year-on-year by 5%.

However, increased cost of sales due to the company’s inability to pass on the incremental costs from augmentation in the Gas Infrastructure Development Cess (GIDC) squeezed the gross margins of the company to 39.8% in 1HCY14, down by 760 percentage points, an AKD research reported on Thursday.

In addition, a lower ‘other income’ on the back of an absent dividend from Fauji Fertilizer Bin Qasim Limited (FFBL), alongside higher financial charges resulted in a 14% year-on-year dip in the net earnings of the company.

Despite this, FFC declared a cash dividend of Rs3.4 per share during the second quarter of the calendar year 2014 (2QCY14), taking the 1HCY14 dividend payout ratio to nearly a 100%.

The revenue levels of the company posted a year-on-year growth of 5%. Other income, however, declined by 5% year-on-year to Rs1.81 billion due to an absence of dividend income from FFBL and slightly higher financial charges.

While the share price seems fairly valued at the moment, any change in the urea prices on the back of the removal of GIDC exemption from the old fertiliser plants are expected to rejuvenate the gross margins of the company, the report added.

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PLP NEWS ALERTS EMAIL No. 172-2014 Published in The Express Tribune, July 25th, 2014.

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PLP NEWS ALERTS EMAIL No. 172-2014 Govt to frame four-year energy plan for outages

By Zafar Bhutta

Published: July 25, 2014

ISLAMABAD:

The government is planning to frame a four-year integrated energy programme in an effort to end prolonged outages, a move that comes in the face of its failure to manage the energy sector properly and load-shedding of up to 20 hours a day, sources say.

A committee, constituted by the Economic Coordination Committee (ECC) of the cabinet in its meeting on July 17, would come up with recommendations for the integrated energy plan for generation, transmission and distribution, sources say.

The committee, to be chaired by Planning and Development Minister Ahsan Iqbal, will finalise the recommendations in two months.

Its members will be the chairman of Board of Investment and secretaries of the Finance Division, petroleum and water and power ministries. The Ministry of Water and Power will provide secretarial support to the committee.

Consumer demand for electricity has risen past 20,000 megawatts, though production stands at a meagre 13,000MW, showing a gap of 7,000MW and forcing the government to resort to widespread outages across the country.

Soon after coming to power in June 2013, the PML-N government announced a new energy policy to eliminate power outages in the next three years but it failed to bear fruit even after one year.

In the meantime, power tariffs were increased by over 31% for domestic consumers and subsidy was eliminated for consumers using more than 200 units.

However, blackouts are still there with people trying to cope with the darkness even in Sehr and Iftar timings during Ramazan.

Circular debt, called one of the major problems that beset the energy chain, has surged again to over Rs300 billion and receivables of power companies exceed Rs500 billion while Pakistan State Oil (PSO) is owed over Rs190 billion.

Corruption in power firms still goes unchecked and recovery of electricity bills has not improved much, which besides electricity theft are the main causes of losses suffered by the power companies.

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PLP NEWS ALERTS EMAIL No. 172-2014 According to officials, the failure of Pakistan Electric Power Company (Pepco) to clear its dues has prompted PSO to seek an increase in its credit limit in order to pay bills of international fuel suppliers.

PSO has defaulted on payments for five letters of credit (LCs) worth Rs26 billion to global oil suppliers because of delay in clearance of its outstanding bills and international banks are reluctant to clear the LCs. Even fuel suppliers are hesitant to provide oil without advance payments.

Officials pointed out that Pepco recovered Rs4 billion daily from power consumers but it was allocating only Rs200 to Rs250 million for payment to PSO on account of fuel supply.

Published in The Express Tribune, July 25th, 2014. Another mobile paisa facility launched

By Our Correspondent

Published: July 25, 2014

LAHORE:

Warid Telecom and Bank Alfalah Limited announced the launch of their marketing campaign for Branchless Banking Services under the brand name Mobile Paisa in Pakistan with Monet (Pvt) Limited as the technology provider.

The launch aims to bridge the gap between banking services and consumers as it provides advanced mobile financial services, convenience, reliability and security for customers.

The services include money transfer, bill payments and customer mobile wallets. Services for consumers, corporates and G2P will be launched soon. Speaking on Mobile Paisa hitting over 10,000 agents for branchless banking, Warid Telecom Chief Executive Officer Muneer Farooqui said the facility is aimed at making mobile financial services effortless. “In this era of modernisation and technical development, it is essential to digitise and enhance transacting convenience through a secure and swift system,” said Farooqui.

Warid Telecom Director Mobile Financial Services Faisal Khan Sadozai labelled it as the “beginning”. “With aggressive expansion plans, we have a sound strategy towards making Mobile Paisa brand evolve and thrive in coming times. I am looking at Mobile Paisa hitting another 30,000 agents across 1,000 towns in the near future. Pakistan is surely a good market for branchless banking. “

Bank Alfalah Group Head Retail South and New Initiatives Mehreen Ahmed, who leads the branchless banking team, believes the bank is aggressively pursuing the creation of a financial ecosystem that supports innovation through technology.

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PLP NEWS ALERTS EMAIL No. 172-2014 “Mobile Paisa is yet another reiteration of our commitment to enhancing financial access and inclusion to reduce the gap between the banked and the yet-to-be-banked in Pakistan,” said Ahmed.

Published in The Express Tribune, July 25th, 2014. Tax collection: FBR looks to bridge communication gap with business community

By APP / Creative: Jamal Khurshid

Published: July 25, 2014

ISLAMABAD:

The Federal Board of Revenue (FBR) on Thursday said that it would not take any measures that may cause havoc in the business community, urging businessmen to cooperate with the tax department in a bid to enhance the country’s collection.

“The communication gap between the FBR and taxpayers is the main hurdle in improving tax revenue,” said General Intelligence and Investigation (I&I) Inland Revenue Director Ejaz Hussain. “A Dispute Resolution and Advisory Committee, comprising representatives from the FBR and the Islamabad Chamber of Commerce & Industry (ICCI), should be formed to resolve tax issues amicably.”

Addressing the business community at the chambers, Hussain said the committee should comprise the representative of I&I Directorate and ICCI.

The director assured that the FBR would not take coercive measures, adding criminal proceedings will only be initiated in rare cases, where taxpayers would not extend any cooperation with the department.

He said instructions have already been issued to I&I Directorate officers to not collect Capital Value Tax (CVT), as only field units of the Regional Tax Office will collect it.

“Without authorised warrants, no officer of FBR can raid business premises and businessmen should not cooperate with those officers who don’t have authorised warrants,” said Hussain. “Rather, they should report such matters to the police.”

He added that better relations between tax collectors and taxpayers is the way forward to promote national interest, giving assurance that the FBR would not take any such measures that may create any unnecessary tension in the community.

Speaking on the occasion, ICCI Acting President, Khalid Mehmood Chaudhry highlighted various tax-related issues of the business community. He said businessmen are ready to pay tax, but certain measures like initiating criminal proceedings, detention and registration of FIRs

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PLP NEWS ALERTS EMAIL No. 172-2014 against some taxpayers have created lot of harassment in the business community and the FBR should avoid such extreme measures to improve trust deficit and to build confidence.

He welcomed the formation of the Dispute Resolution & Advisory Committee and hoped that after its formal notification, it will serve to the betterment of the relationship between taxpayers and collectors.

Published in The Express Tribune, July 25th, 2014. Automobile corruption: Stop abusing import policies, says PAAPAM

By Our Correspondent

Published: July 25, 2014

KARACHI:

The country’s automotive industry and manufacturers are suffering due to the aftershocks of inconsistent import policies, rampant import of used cars and frequent amnesty schemes of the past government, said the Pakistan Association of Automotive Parts and Accessories Manufacturers’ (PAAPAM) Chairman Usman Malik on Thursday.

“Used car importers, in connivance with the customs and FIA immigration officials, are misusing the personal baggage schemes, which are meant only to facilitate overseas Pakistanis for importing their own used vehicles into the country,” said Malik.

The chairman added that in order to control the menace, all overseas Pakistanis, who bring their personal vehicles to the country, should be required to register these imported cars under their own name in Pakistan; with the condition that they cannot sell or transfer it for a specified number of years.

As per current rules, overseas Pakistanis are required to stay abroad for at least two years and the vehicles, which they wish to import, must be in their possession during their stay abroad.

Besides, they have to produce foreign vehicle registration certificates along with their driving licence at the time of clearance.

However, this scheme is being misused, which is being patronised by a lobby of some customs and immigration officers.

The majority of vehicles being imported under this scheme are not owned by overseas Pakistanis but their passports are stamped wrongly by immigration officers and used for commercially importing used vehicles from Japan.

Published in The Express Tribune, July 25th, 2014.

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PLP NEWS ALERTS EMAIL No. 172-2014

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PLP NEWS ALERTS EMAIL No. 172-2014 Forex: Reserves drop a nominal 0.9%

By Our Correspondent

Published: July 25, 2014

KARACHI:

Foreign exchange reserves held by the State Bank of Pakistan (SBP) recorded a week-on- week nominal decrease of 0.9% on July 18, according to data released by the SBP on Thursday.

The central bank’s foreign exchange reserves decreased $87 million to $9,399 million compared to $9,486 million in the preceding week.

During the week ending July 18, the SBP made payments of $69 million on account of external debt servicing and other official payments. The SBP did not receive any significant inflows during this week.

Total liquid foreign reserves held by the country, including net foreign reserves held by banks other than the SBP, stood at $14,450.2 million while net foreign reserves held by banks amounted to $5,051.4 million on July 18.

Published in The Express Tribune, July 25th, 2014.

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PLP NEWS ALERTS EMAIL No. 172-2014

OPEN MARKET FOREX RATES Updated at: 25/7/2014 7:44 AM (PST) Currency Buying Selling Australian Dollar 92.75 93 Bahrain Dinar 261.95 262.2 Canadian Dollar 91.6 91.85 China Yuan 15.7 15.85 Danish Krone 17.8 17.95 Euro 132.5 132.75 Hong Kong Dollar 12.6 12.75 Indian Rupee 1.6 1.65 Japanese Yen 0.98 0.99 Kuwaiti Dinar 349.85 350.1 Malaysian Ringgit 30.85 31.1 NewZealand $ 85.75 86 Norwegians Krone 15.75 15.9 Omani Riyal 256.45 256.7 Qatari Riyal 26.9 27.15 Saudi Riyal 26.2 26.45 Singapore Dollar 79.1 79.35 Swedish Korona 14.5 14.65 Swiss Franc 110 110.25 Thai Bhat 3.05 3.10 U.A.E Dirham 26.75 27 UK Pound Sterling 167.5 167.75 US Dollar 98.6 98.85

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PLP NEWS ALERTS EMAIL No. 172-2014

INTER BANK RATES Updated at: 25/7/2014 7:44 AM (PST) Bank Buying Bank Selling Currency TT Clean TT & OD Australian Dollar 93 93.19

Canadian Dollar 91.61 91.79

Danish Krone 17.76 17.8

Euro 132.46 132.73

Hong Kong Dollar 12.69 12.72

Japanese Yen 0.9690 0.9710

Saudi Riyal 26.24 26.29

Singapore Dollar 79.5 79.66

Swedish Korona 14.38 14.41

Swiss Franc 109.02 109.25

U.A.E Dirham 26.79 26.84

UK Pound Sterling 167.6 167.95

US Dollar 98.4 98.6

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PLP NEWS ALERTS EMAIL No. 172-2014 Bullion Rates (Gold Prices) in Pakistan Rupee (PKR) As on Fri, Jul 25 2014, 03:45 GMT PKR PKR PKR Metal Symbol for 10 Gm for 1 Tola for 1 Ounce

Gold 24K XAU 41,001 47,772 127,528

Palladium XPD 27,633 32,197 85,950

Platinum XPT 46,589 54,284 144,911

Silver XAG 649 756 2,019

Gold Rates in other Major Currencies 1 Currency Symbol 10 Gm 1 Tola Ounce Australian

AUD 442 515 1,375 Dollar Canadian

CAD 447 521 1,390 Dollar

Euro EUR 309 360 961

Japanese

JPY 42,323 49,314 131,643 Yen U.A.E

AED 1,527 1,780 4,751 Dirham UK Pound

GBP 245 285 761 Sterling

US Dollar USD 416 485 1,293

* These rates are taken from International Market so there may be some fluctuation from Local Market.

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PLP NEWS ALERTS EMAIL No. 172-2014 Gold Rates & Silver Rate from major cities of Pakistan

A year by year reference of the daily Silver Price in Pakistan and history of Gold Rates in Pakistan Jul 24, 2014

Following table shows gold rates per Tola in Pakistan in Pakistani Rupess (PKR) in 24 carat per 10 Grams, 22 carat per 10 grams and sliver rates per 10 grams in pakistan.

City 24k per 10gm 24k per Tola 22k Per 10gm 21k Per 10gm Silver Karachi 41,400 48,300 37,950 36,225 651 Lahore 41,400 48,300 37,950 36,225 651 Multan 41,400 48,300 37,950 36,225 651 Faisalabad 41,400 48,300 37,950 36,225 651 Rawalpindi 41,400 48,300 37,950 36,225 651 Hyderabad 41,400 48,300 37,950 36,225 651 Gujranwala 41,400 48,300 37,950 36,225 651 Peshawar 41,400 48,300 37,950 36,225 651 Quetta 41,400 48,300 37,950 36,225 651 Islamabad 41,400 48,300 37,950 36,225 651 Sargodha 41,400 48,300 37,950 36,225 651

Source: Karachi Saraf.

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