ASIAN CLEARING UNION
DRAFT
ANNUAL REPORT
2001
Colombo, May 2002
ASIAN CLEARING UNION
ANNUAL REPORT
2001
Submitted to: The Thirty First Meeting of the Board of Directors
Held at:
Central Bank of Sri Lanka
Colombo
May 30 - 31, 2002
I
BOARD OF DIRECTORS AT THE 30TH ACU MEETING 28 – 29 May 2001 Yangon, Myanmar
II
PARTICIPANTS AT THE 30THE MEETING OF THE ACU BOARD OF DIRECTORS 28 – 29 May 2001 Yangon, Myanmar
III Board of Directors
Fakhruddin Ahmed Sonam Wangchuk Bimal Jalan Mohsen Nourbakhsh Governor Governor Governor Governor Bangladesh Bank Royal Monetary Authority of Bhutan Reserve Bank of India The Central Bank of the I. R. of Iran
Kyaw Kyaw Maung Tilak Rawal Ishrat Husain A. S. Jayawardena Governor Governor Governor Governor Central Bank of Myanmar Nepal Rastra Bank State Bank of Pakistan Central Bank of Sri Lanka
IV Alternate Directors
Mohammad Ruhul Amin Dechen Tshering T. C. Nair Mohammad Jafar Mojarrad Deputy Governor Deputy Managing Director Chief General Manager Vice Governor Bangladesh Bank Royal Monetary Authority of Bhutan Reserve Bank of India The Central Bank of the I. R. of Iran
Than Lwin K. B. Manandhar Farhat Saeed K. R. M. Siriwardhane Deputy Governor Chief Controller Executive Director Director Central Bank of Myanmar Nepal Rastra Bank State Bank of Pakistan Payments & Central Bank of Sri Lanka Settlements Dept.
V Officer-in-Charge
Mahfuzur Rashid Namgay Tshering T. C. Nair Behrooz Nowbahar General Manager General Manager Chief General Manager Director International Dept. International Dept. Bangladesh Bank Royal Monetary Authority of Bhutan Reserve Bank of India The Central Bank of the I. R. of Iran
Maung Maung Dharma K. Manadhar Muhammed S. Rehmani Padmasriya Sudasinghe Deputy Director Assistant Director Director, Accounts Dept. Senior Assistant Director Accounts Dept. Foreign Exchange Dept. State Bank of Pakistan Payments and Settlements Dept. Central Bank of Myanmar Nepal Rastra Bank Central Bank of Sri Lanka
VI
CONTENTS
Page Administrative Organization VIII Board of Directors IX Officers in Charge XI Letter of Transmittal XII World Economic Developments and Outlook 1 Economic Highlights of the ACU Member Countries 4 Country Performance : Bangladesh 9 Bhutan 18 India 22 Iran 32 Myanmar 41 Nepal 46 Pakistan 59 Sri Lanka 67 Clearing Operations 86 Interest Paid/Received 95 SWAP Facility 97 Activities to Enlarge the Role of ACU in the Region 99 Twenty Six Years of ACU Operations 101 Tables 105
VII ASIAN CLEARING UNION (Administration Organization, 2001)
CHAIRMAN OF THE BOARD : H. E. Mr. Kyaw Kyaw Maung Governor, Central Bank of Myanmar
SECRETARY GENERAL : Dr. Mohammad Firouzdor
DEPUTY SECRETARY GENERAL : Mr. Morteza Farshchi
SECRETARIAT LOCATION : Islamic Republic of Iran, Tehran P. O. Box 15875/7177 Tlx: 088-21-3120 & 6868 Tel: 0098-21-284-2076 Fax: 0098-21-284-7677 E-mail: [email protected] Swift: BMJIIRTH
AGENT BANK : The Central Bank of the Islamic Republic of Iran
VIII
ASIAN CLEARING UNION ( BOARD OF DIRECTORS, 2001)
BANGLADESH BANK : H.E. Dr. Fakhruddin Ahmed 1 Governor. (Director)
Mr. Mohammad Ruhul Amin Deputy Governor. (Alternate)
ROYAL MONETARY AUTHORITY H.E. Mr. Sonam Wangchuk OF BHUTAN : Governor. (Director)
Mr. Dechen Tshering Deputy Managing Director. (Alternate)
RESERVE BANK OF INDIA : H.E. Dr. Bimal Jalan Governor. (Director)
Dr. T. C. Nair 2 Chief General Manager. (Alternate)
CENTRAL BANK OF THE H.E. Dr. Mohsen Nourbakhsh ISLAMIC REPUBLIC OF IRAN : Governor. (Director)
Dr. Mohammad Jafar Mojarrad Vice Governor. (Alternate)
CENTRAL BANK OF MYANMAR : H.E. Mr. Kyaw Kyaw Maung Governor. (Director)
Mr. Than Lwin Deputy Governor. (Alternate)
IX
NEPAL RASTRA BANK : H.E. Dr. Tilak Rawal Governor. (Director)
Mr. K. B. Manandhar Chief Controller. (Alternate)
STATE BANK OF PAKISTAN : H.E. Dr. Ishrat Husain Governor. (Director)
Mr. Farhat Saeed Executive Director. (Alternate)
CENTRAL BANK OF SRI LANKA : H.E. Dr. A. S. Jayawardena Governor. (Director)
Mrs. K. R. M. Siriwardhane 3 Director Payments & Settlements, Department. (Alternate)
1. From 24.11.2001. 2. From 01.06.2001. 3. From 01.01.2002.
X ASIAN CLEARING UNION ( OFFICERS IN CHARGE, 2001 )
BANGLADESH BANK : Mr. Mahfuzur Rashid General Manager International Dept.
ROYAL MONETARY AUTHORITY Mr. Namgay Tshering OF BHUTAN : General Manager Foreign Exchange Division
RESERVE BANK OF INDIA : Mr. S. C. Misra 1 Deputy General Manager, DEIO.
CENTRAL BANK OF THE Mr. Behrooz Nowbahar ISLAMIC REPUBLIC OF IRAN : Director, International Dept.
CENTRAL BANK OF MYANMAR : Mr. Maung Maung Deputy Director, Accounts Dept.
NEPAL RASTRA BANK : Mr. Dharma Krishna Manandhar Assistant Director, Foreign Exchange Dept.
STATE BANK OF PAKISTAN : Mr. Muhammed Saleem Rehmani 2 Director, Accounts Dept.
CENTRAL BANK OF SRI LANKA : Mrs. P. Sudasinghe 3 Senior Assistant Director, Payments and Settlements Dept.
1. From 01.09.2001. 2. From 05.12.2001. 3. From 01.01.2002.
XI
LETTER OF TRANSMITTAL TO THE BOARD OF DIRECTORS
May 30, 2002
H. E. Dr. A. S. Jayawardena Chairman, ACU Board of Directors Central Bank of Sri Lanka Colombo
Dear Mr. Chairman,
I have the honor to present to the Board of Directors, the Annual Report of the ACU for the year 2001, duly signed by me, in accordance with chapter III, Article VIII, section 3(c) of the Agreement Establishing the Asian Clearing Union.
Yours sincerely,
Dr. Mohammad Firouzdor Secretary General, ACU
XII
World Economic Developments
and
Outlook
WORLD ECONOMIC DEVELOPMENTS AND OUTLOOK
The global economy in 2000 grew at its fastest pace in over a decade and a half, bolstered by the continuing strong performance of most advanced countries and a substantial pickup in growth in other regions of the world, particularly in the Western Hemisphere, Middle East, and countries in transition. The pace of global economic growth moderated in late 2000 and early 2001, however, led by a slowdown in the advanced economies especially the United States and moderating growth in a number of emerging market countries. "Headline" inflation (including energy and food) edged up in the advanced economies, reflecting higher energy prices and strong economic activity, but fell in the developing countries and countries in transition. Fiscal imbalances were reduced in the major regions of the world but external imbalances remained a source of concern in some countries. Financial flows to emerging market economies continued to recover in 2000, although the cost of financing increased in the final quarter of the year as international market conditions tightened. Buoyant world demand supported strong growth in the volume of trade, both in advanced economies and, especially, in developing and transition economies. Other key developments during 2000 and early 2001 included the sharp fall in the major equity markets, particularly in the United States; problems with two important emerging market borrowers, Argentina and Turkey; and a retreat of oil prices from their late 2000 high. U. S. equity markets fell during most of 2000 and early 2001, reflecting weak corporate earnings reports, a downward revision of technology valuations, tightening credit conditions, and increased expectations of a U. S. slowdown. This fall was mirrored in other mature equity markers and spilled into emerging markets. Spreads on emerging market bonds widened in the last quarter of 2000, driven by tighter external liquidity conditions worsened by concerns about the economic and financial situation in Argentina and Turkey. Global liquidity conditions improved in early 2001, partly as a response to cuts in U. S. interest rates that began in January. Conditions tightened once again in March, however, largely reflecting the growing financing problems in Argentina. Oil prices increased from the second quarter of 2000 through to November but then eased, partly because of the global slowdown. The outlook for oil prices and production, however, remained highly uncertain. Output growth strengthened in the developing countries as a group in 2000, fueled by buoyant exports as well as recoveries in domestic demand. Economic growth picked up strongly in Latin America, the Middle East, and, to a lesser extent, in Africa and in developing Asia. The buoyancy of the Latin American economies was aided by strong U. S. demand and recoveries in domestic demand from the depressed levels of 1999. In 2000, sharp terms-of-trade improvements and increases in oil production quotas of the Organization of Petroleum Exporting Countries (OPEC) boosted output growth in the Middle East to rates not seen since the early 1990s. Continued strong growth in China
1 and India supported the economic improvement in Asia as a whole. Following a period of economic growth at or above potential, activity in the advanced economies weakened late in 2000, led by a sharp slowdown in the United States, stalling recovery in Japan, and moderating growth in Europe. After annualized growth of 51/2 per cent in the second quarter of 2000, economic expansion in the United States slowed sharply during the rest of the year with GDP growing by only 1 per cent (annualized) in the fourth quarter. This slowdown was a result, in part, of the tightening of monetary policy during the year, and also of higher oil prices and the decline in equity markets, including a sharp fall in the NASDAQ. Weighed down by low consumer confidence, slowing business investment, and weakening external demand, economic growth in Japan failed to sustain the strong performance of the first quarter of 2000. Output growth in Europe increased further relative to the previous year, registering its strongest expansion since the late 1980s. Growth eased during the latter part of 2000 and in early 2001, however, apparently in response to the impact of higher oil prices on purchasing power, weaker business confidence, and spillover effects of the U. S. slowdown.
Global Environment
In commodity markets, oil prices continued to increase during most of 2000, paced by strong energy demand and supply constraints, before easing in December and in early 2001. To contain oil prices within its US Dollars 22 - 28 reference range, OPEC announced plans to cut oil production. Spot prices stayed volatile, reflecting uncertainties about the extent and duration of the global economic slowdown, and also about oil production prospects and the political situation in some parts of the Middle East. Nonfuel commodity prices remained in a slump, rising little from their depressed level of 1999 especially when measured in U. S. dollar terms. The largest changes were in prices of metals and timber. Metals prices, after firming slightly in the third quarter of 2000, fell back. Food prices increased late in 2000 but also declined subsequently. In addition to a fall in coffee prices, the beef market was hurt by health concerns, particularly in Europe, and cereals stocks remained high relative to consumption. During early 2001, weakening global demand put further downward pressure on commodity prices. World trade volumes rose sharply in 2000, particularly early in the year. Imports to the advanced economies grew at double-digit annual rates as demand growth picked up in North America and Europe. Imports to developing countries also grew strongly, especially in developing Asia, the Middle East, and the Western Hemisphere. Rapid consumption and investment growth in the largest countries of these regions fueled the increase in demand for imports.
2
Economic Highlights
ECONOMIC HIGHLIGHTS OF THE ACU MEMBER COUNTRIES
BANGLADESH : The impact of the deteriorating global economic situation together with imbalances in the domestic economy slowed down economic growth in Bangladesh during 2000-2001. Weakened export performance resulting from the slowdown in developed economies weakened growth in the industrial sector and services sector of the domestic economy. Real GDP growth stood at 5.2 per cent during 2000-2001as against 5.9 per cent in 1999-2000. Growth in the agricultural sector was 5.5 per cent, and in the industrial sector was 6.3 per cent. Growth in construction sector increased to 8.6 per cent during 2000-2001 as against 8.5 per cent in the preceding year. Growth in wholesale and retail trade, real estate, renting and business activities declined to 6.0 and 3.4 per cent as against 7.3 and 3.8 per cent in 1999-2000. The ratio of GDS to GDP remained unchanged at 17.9 per cent. Government revenue receipts as percentage of GDP marginally increased to 9.5 per cent. Exports grew by 12.4 per cent in 2000-2001, the increased was due mainly to higher earnings in ready-made garments, leather, hosiery products, frozen shrimps and fish, fertilizer and tea. Imports payments increased by 11.4 per cent to US Dollars 9,363 million as against US Dollars 8,403 million in 1999- 2000. Workers' remittances stood at US Dollars 1,882 million or 3.4 per cent lower than of the preceding year.
BHUTAN : The real GDP in 2000 is estimated to have grown by 6.1 per cent as against 5.9 per cent in the previous year. The construction sector, with an estimated growth of about 20 per cent compared to 25 per cent in the preceding year continues of exert a major influence on the GDP growth. The growth in other major sectors, including mining and quarrying, manufacturing and electricity, is estimated to weaken to 6 per cent in 2000 from 7 per cent of the previous year. However, the decline in this sector is expected to be compensated by the performance in the transport, storage and communications sector, with estimated growth of about 6 per cent, compared to a growth of 5 per cent in the previous period. In 2000-2001, the growth of money supply slowed, M1 growing by 21.3 per cent against 28.7 per cent in 1999-2000 and M2 by 5.5 per cent, as compared to 21 per cent in the preceding year. During the review period, Bhutan's overall exports and imports increased by approximately 4 and 23.7 per cent respectively. The external sector will continue to be dominated by close trade and exchange links with India. As more economic activities are envisaged in the ninth plan, the current account deficit in the balance of payments is expected to widen further during the period.
INDIA : The Indian economy recorded a growth rate of 4.0 per cent in 2000-2001 as against 6.1 per cent in 1999- 2000 and 6.6 per cent in 1998-1999. The slowdown in growth in 2000-2001 reflected the impact of two consecutive years of below-average monsoons, a downturn in industrial growth after promising signs of revival in 1999-2000, the strains imposed by droughts and floods in various parts of the country and the unprecedented severity of the Gujarat earthquake. Despite this slowdown, India's growth rate was higher than most other developing (excluding China) and advanced economies. GDP growth in "agricultural and allied activities" turned negative in 2000-2001with the growth rate being -0.2 per cent, down from 1.3 per cent in 1999-2000 but improved to 3.4 per cent in the second quarters of 2001-2002 due to well distributed monsoon. Industrial production in 2000-2001 decelerated to 5.1 per cent from 6.7 per cent in 1999-2000. Growth in services sector that had averaged over 8.5 per cent over 1994-2000 decelerated to 5.0 per cent in 2000-2001 India's export at US Dollars 44.6 billion recorded a growth of 21.0 per cent during 2000-2001, much
4 higher than 10.8 per cent during 1999-2000. Imports increased only marginally from US Dollars 49.6 billion to US Dollars 50.5 billion recording a growth of 1.7 per cent during 2000-2001. India's external debt increased from US Dollars 98.3 billions at end March 2000 to US Dollars 100.4 billion as at end March 2001.
IRAN : Preliminary estimates for major variables in (2001-2002) indicate that real GDP and capital formation grew by 4.5 and 12.1 per cent respectively. Real GDP growth in (2001-2002) was mainly spurred by the growth of manufacturing, construction and service sectors. Furthermore, gross fixed capital formation has rebounded in (2000- 2001) and the year under report, after two consecutive year of sluggish growth. The sharp decline of international oil prices in the aftermath of September 11, 2001 events and world economic recession unfavorably affected output growth in the Iranian economy. Foreign exchange revenue from oil and gas exports fell by 20.4 per cent and amounted to US Dollars 19.3 million in (2001-2002). However, non-oil exports faced a relatively favorable trend in this period due to the reforms in foreign exchange and trade regulations, provision of banking facilities in domestic and foreign currency to foreign trade sector, exemption of exporters from taxes and levies, and stability in the exchange market. As a result of improvement in the balance of payments position, increased public confidence in economic stability, and implementation of non-expansionary fiscal policies, inflation rate stood at 11.4 per cent.
MYANMAR : In implementing a second five-year short-term plan, which extends from 1996-1997 through 2000- 2001, Myanmar has been able to achieve an annual growth rate of 8.4 per cent surpassing initial target of 6.0 per cent. This achievement can be attributed to the implementation of the plan in every sector and every region, the effective use of human resources of the nation, active participation of the people and the abundance of natural resources. Agriculture sector achieved a high growth rate of 14.1 per cent as against 10.5 per cent in the previous year. Mining and energy sectors registered 27.1 and 30.8 per cent growth rate in 2000-2001. These achievements were mainly due to the significantly increased private sector participation in mining sector and increased production of newly found offshore gas fields, a majority of which is exported to Thailand. Manufacturing and processing sector achieved a record growth rate of 23.8 per cent, services sector registered a significant high growth rate of 12.2 per cent. Budget revenue increased to 20.6 per cent of GDP. The external current account deficit registered a strong improvement to reach Kyat 299.5 million against Kyat 2,919.6 million in the previous year.
NEPAL : GDP at 1994-1995 factor cost is estimated to have grown by 4.9 per cent. This was mainly attributed to the normal weather conditions for agricultural sector and high growth in electricity, gas and water and community and social services sub-sectors of non-agricultural sector. Last year, it had recorded the growth of 6.4 per cent. Sectorally, both agriculture as well as non-agriculture sector showed a respective growth of 4.2 per cent and 5.3 per cent during the review year while these sectors registered higher growth of 5.0 per cent and 7.2 per cent last year. Industrial production index of the major 33 products (base year 1986-1997=100) increased by 5.7 per cent in the review year while the production of exportable goods like garments and carpet has declined. In the external sector, the policies adopted during the FY 1999-2000 mainly concentrated on facilitation of foreign exchange, in 2000-2001, total exports increased by much higher growth rate than imports. However, there was a slight expansion in trade deficit owing mainly to large magnitude of imports. Total exports increased by 11.7 per cent and reached to Rs. 55.7 billion. Total imports increased
5 by 6.6 per cent to Rs. 115.7 billion as against a large increase of 24.0 per cent in the previous year.
PAKISTAN : Pakistan's economic performance in FY2001 can be characterized by government efforts to bring macroeconomic fundamentals back on-track. The fiscal deficit was contained within its targeted level, inflation was low, current account was in surplus, foreign exchange reserve accumulation was satisfactory and government borrowing from the banking system was within manageable limits. For the first time, Pakistan completed its Standby Arrangements (SBA) with the IMF and established credibility with the international financial institutions. Overall economic activities slackened considerably in FY2001. Growth in real gross domestic product (GDP) decelerated from 3.9 per cent in FY2000 to 2.6 per cent in FY2001 against the target of 5.0 per cent. This slowdown, originating in the agriculture sector, was imminent due to the drought like situation caused by the acute shortage of water throughout the country. Pakistan's external sector witnessed a range of positive developments during 2000-2001. Exports exceeding US Dollars 9 billion mark for the first time in the country's history, workers' remittances crossing US Dollars 1 billion mark again after a lapse of one year. Imports remained below the annual target of US Dollars 10,964 million, and decelerated by 4.1 per cent to 10,729 million compared with imports growth of 9.3 per cent in 1999-2000.
SRI LANKA : The Sri Lankan economy is estimated to have contracted by 1.3 per cent in 2001, primarily due to the significant deterioration in the global economy in 2001.* The prolonged drought and the country's uncertain political and economic environment also had a negative impact on the economic performance in 2001. The balance of payments recorded a surplus. The rate of unemployment increased marginally from 7.6 per cent to 7.8 per cent by the third quarter of 2001, particularly in the aftermath of the terrorist attack on the country's only international airport as tourism and related industries were severely affected. Sri Lanka's overall balance of payments reflected a surplus after three consecutive years of deficits. The overall balance in the balance of payments registered a surplus of US Dollars 220 million in 2001 against a deficit of US Dollars 522 million recorded in the previous year. However, the very adverse international economic environment caused a sharp decline in international trade in goods and services. Although the trade and current account deficits in the balance of payments declined, the overall balance in the balance of payments registered a lower surplus than originally estimated. Exports declined by 12.8 per cent, while imports declined by 14.9 per cent, reducing the trade deficit. As a result, the current account deficit narrowed significantly from 6.4 per cent of GDP in 2000 to 2.4 per cent in 2001. The slowing down in economic activities, particularly the reduction in international trade, reduced government revenue. As a result, the fiscal deficit widened to 10.8 per cent of GDP compared to the budgetary target of 8.5 per cent and last year's outcome of 9.9 per cent. Following the same trend, the current account deficit rose from 3.4 per cent of GDP in 2000 to 4.8 per cent of GDP in 2001. ______* A provisional annual estimate based on the information available as at end January 2002
6 ASIAN CLEARING UNION
INTRA-TRADE AND TRADE BALANCE OF ACU MEMBERS ( IN MILLION US DOLLARS )
Surplus (+) * ** or Country Exports to ACU Imports from ACU Deficit (-) ______1999 2000 1999 2000 1999 2000
BANGLADESH 122 126 1,171 1,097 -1,049 -971
BHUTAN ------
INDIA 2,106 2,262 1,414 1,655 692 607
IRAN 958 1,395 199 344 759 1,051
MYANMAR 248 301 61 72 187 229
NEPAL 163 183 475 539 -312 -356
PAKISTAN 313 306 289 609 24 -303
SRI LANKA 119 132 694 880 -575 -748
TOTAL 4,029 4,705 4,303 5,196 -274 +491
Source: Direction of Trade Statistics, Year Book 2001, International Monetary Fund.
* F. O. B ** C. I. F
7
Country Performance of the
Members
BANGLADESH
Global economic growth slowed significantly by late 2000, and the downturn was further aggravated by the tragic incident of 11 September, 2001 in the United States. The impact of the deteriorating global economic situation together with imbalances in the domestic economy slowed down economic growth in Bangladesh during 2000-2001. Weakened export performance resulting from the slowdown in developed economies weakened growth in the industrial sector and services sector of the domestic economy.
Real GDP- Growth and Composition
Real GDP growth stood at 5.2p per cent during 2000-2001 as against 5.9 per cent in 1999-2000. Growth in the agricultural sector was 5.5p per cent, and in the industrial sector was 6.3p per cent. Fisheries sector recorded a negative growth of 4.5p per cent during 2000-2001 as against a positive growth of 8.9 per cent during the preceding year. Growth in construction sector increased to 8.6p per cent during 2000-2001 as against 8.5 per cent in the preceding year. Growth in wholesale and retail trade, real estate, renting and business activities declined to 6.0p and 3.4p per cent during the year under report as against 7.3 and 3.8 per cent respectively during the previous year. Real GDP growth in 2001-2002 is expected to be about 4.8 per cent, lower than previous year because of weak performance in export and allied manufacturing sectors.
Savings and Investment
The ratio of gross domestic savings to GDP remained unchanged at 17.9p per cent during 2000-2001. The ratio of national savings to GDP stood slightly higher at 23.8p per cent in 2000-2001 as compared to 23.1 per cent in the previous year. The ratio of gross investment to GDP stood marginally higher at 23.1p per cent in 2000-2001 as compared to 23.0 per cent in 1999-2000. The share of domestic resources in the Annual Development Programme (ADP) expenditure increased to 54.2 per cent in 2000-2001 from 49.8 per cent in the preceding year.
______p= Provisional
Fiscal Developments
Government revenue earnings of TK. 188,079 million during 2000-2001 were 24.4 per cent higher than the receipts in the preceding year. Government revenue receipts as percentage of GDP marginally increased to 9.5 per cent in 2000-2001 compared to 9.0 per cent in the preceding year. Though there was surplus in the revenue budget, government had to take recourse to bank and non-bank borrowing to finance Annual Development Programme (ADP). Expenditure on ADP as percentage of GDP increased to 7.2 per cent during 2000-2001 from 6.6 per cent in previous year. To partially meet this increased expenditure, Government borrowing from the banking system and from the non- bank public was TK. 29,044 million and TK. 42,077 million respectively during 2000-2001. The overall budget deficit as
9 percentage of GDP stood at 5.8 per cent in 2000-2001 compared to 6.0 per cent in 1999-2000. Revenue receipts of the government during July, 2001-February, 2002 increased by 8.4 per cent to TK. 119,902 million compared to TK. 110,641 million during the corresponding period last year.
Monetary and Credit Situation
Broad money and domestic credit increased by 16.6 per cent and 17.7 per cent respectively during 2000-2001 as compared to the growth of 18.6 per cent and 13.6 per cent respectively during the preceding year. The fairly high expansion of domestic credit, although not creating inflationary pressure, caused depletion in net foreign assets, which declined by 15 per cent during 2000-2001. For the year 2001-2002, the money and credit programme has targeted a lower expansion of 10 per cent and 10.4 per cent for broad money and domestic credit; because of the lower GDP growth expectations in the worsened external scenario.
Price Situation
The upswing of inflation that occurred in the wake of devastating flood of 1998 subsequently abated in rapid pace due to post-flood good harvest of food crop and improvement in overall supply situation. The declining trend of inflation continued during 2000-2001 due mainly to good production of Boro and Aman. As a result, the annual rate of inflation as measured by Consumer Price Index (Base: 1985-1986 100) on twelve-month average basis declined markedly to 1.6 per cent in 2000-2001 as compared to 3.9 per cent in 1999-2000. This rate remained more of less stable during the first half of 2001-2002. Prices of 'food' items declined marginally from 0.9 per cent in June, 2001 to 0.8 per cent in December, 2001 while that of 'non-food' items increased slightly to 3.0 per cent in December, 2001 from 2.8 per cent in June, 2001.
Exports
Exports grew by 8.2 per cent and 12.4 per cent during 1999-2000 and 2000-2001 respectively. The increase during 2000-2001 was due mainly to higher earnings in ready-made garments of US Dollars 3,364 million (9.1 per cent), leather US Dollars 254 million (30.2 per cent), hosiery products US Dollars 1,496 million (17.8 per cent), frozen shrimps and fish US Dollars 363 million (5.6 per cent), fertilizer US Dollars 68 million (13.8 per cent) and tea US Dollars 22 million (22.0 per cent). However, export receipts by raw jute, jute goods, naphtha and furnace oil declined by 6.2 per cent, 13.3 per cent and 11.0 per cent respectively. Export earnings during 2001-2002 is depicting a negative growth due mainly to the downturn in economic activities in major trade partner countries, particularly in the USA, Japan and the European Countries. Export earnings during July 2001-February 2002 declined by 7.3 per cent to US Dollars 4,031 million as compared to the same period of the preceding year. Overall export performance in 2001-2002 is expected to be weak, with an estimated decline of about 5 per cent compared to the previous year.
10
Imports
Import payments increased by 11.4 per cent to US Dollars 9,363 million in 2000-2001 as compared to US Dollars 8,403 million during 1999-2000. The import payments for crude petroleum, petroleum products, chemicals, raw cotton, textile & textile articles and capital goods increased by 17.7 per cent, 41.6 per cent, 22.3 per cent, 35.4 per cent, 14.5 per cent and 12.5 per cent respectively. Opening of fresh LCs for import declined by 8.7 per cent to US Dollars 4,808 million during July, 2001- January, 2002 as compared to US Dollars 5,267 million during the corresponding period of the preceding year. The decline in imports was due mainly to lower back to back input imports by exporters. Import payments are likely to decline by about 2.5 per cent during 2001-2002. Exports and imports of Bangladesh for last three years are given as follows:
Bangladesh's Total Exports and Imports (In Million US Dollars)
______Sectors 1998-99 1999-2000 2000-2001p ______EXPORTS 5324(2.9%) 5762(8.2%) 6476(12.4%) IMPORTS 8018(6.6%) 8403(4.8%) 9363(11.4%) Trade Balance -2694 -2641 -2887 ______Source: Statistics Department, Bangladesh Bank Note: 1. Figures in the brackets indicate percentage changes over the previous year. 2. Export earnings are receipts from actual exports. p= Provisional
Workers' Remittances
Workers' remittances during 2000-2001 which stood at US Dollars 1,882 million was 3.4 per cent lower than US Dollars 1,949 million of the preceding year. However, workers' remittances during July, 2001-March, 2002 increased by 33 per cent to US Dollars 1,817 million as against US Dollars 1,364 million in the same period last year.
Foreign Exchange Reserves
Bangladesh's foreign exchange reserves which stood at US Dollars 1,602 million at the end of June, 2000 declined to US Dollars 1,307 million as on June 30, 2001. The level of reserves was equivalent to 1.7 months' import payments of the country. Foreign exchange reserves stood at US Dollars 1,377 million on 11 April 2002.
11 Balance of Payments
The overall balance of payments position of the country swung to a deficit of US Dollars 326 million during 2000-2001 from a surplus of US Dollars 325 million in the previous year. The current account registered a substantial deficit of US Dollars 816 million during 2000-2001 as against a surplus of US Dollars 2 million in the preceding year due mainly to increase in trade deficit, marked decline in current transfer and services (net) and increase in deficit under income (net). The deficit in the trade balance increased to US Dollars 2,887 million during 2000-2001 from the level of US Dollars 2,641 million during 1999-2000. Current transfers declined substantially to US Dollars 2,316 million during 2000-2001 from US Dollars 2,672 million. Services (net) declined markedly to US Dollars 19 million from US Dollars 192 million and deficit in income (net) increased to US Dollars 264 million during 2000-2001 from US Dollars 221 million in 1999-2000. Workers' remittances also declined from US Dollars 1,949 million in 1999-2000 to US Dollars 1,882 million during 2000-2001. Financial account position declined from US Dollars 760 million during 1999-2000 to US Dollars 506 million in 2000-2001. However, Capital Account position of the country improved marginally from US Dollars 283 million during 1999-2000 to US Dollars 287 million during 2000-2001.
Trade with ACU Member Countries
Total trade transactions of Bangladesh with Asian Clearing Union (ACU) member countries under the ACU increased in 2000-2001 compared to the preceding year. As in the previous year, Bangladesh remained a net debtor in all the six settlements during this year. Bangladesh's exports to ACU member countries declined while her imports from ACU member countries increased during the year under report, receipts of Bangladesh under the ACU arrangements recorded a decline of ACU Dollars* 6 million or 6.5 per cent to ACU Dollars 82 million during 2000-2001 from ACU Dollars 88 million during 1999-2000 while payments increased by ACU Dollars 242 or 26.7 per cent to ACU Dollars 1,151 million during 2000-2001 from ACU Dollars 909 million during 1999-2000. As a result, the net debtor position of Bangladesh widened by ACU Dollars 248 million to ACU Dollars 1,069 million during the year under report as compared to ACU Dollars 821 million in the preceding year. ______
* 1 ACU Dollar = 1 US Dollar
12 MAIN ITEMS OF GOODS AND SERVICES TRADED WITH ACU COUNTRIES IN 2001 (In Million Taka) EXPORTS ______Country/Commodity Value ______
Bhutan 62
Woven garments 1 Other commodities 61
India 3565
Frozen food 361 Raw jute 1140 Jute goods 141 Leather 58 Chemical products 730 Woven garments 22 Other Commodities 1113
Iran 2097
Jute goods 1864 Raw jute 84 Tea all sorts 108 Other Commodities 41
Myanmar 124
Leather 1 Chemical products 115 Other Commodities 8
Nepal 44
Chemical products 33 Other Commodities 11
Pakistan 1160
Jute goods 8 Raw jute 804 Agricultural products 24 Tea all sorts 165 Chemical products 43 Other Commodities 116
13 Sri Lanka 112
Jute goods 53 Other Commodities 59 ______Total 7,164 ______
Source: Export Promotion Bureau
IMPORTS ______Country/Commodity Value ______
Bhutan 305
Vegetable products 146 Mineral products 53 Other commodities 106
India 64775
Live animals, animal products 1197 Edible vegetables and certain roots and tubers 2292 Edible fruits and nuts peel of citrus fruits of melons 854 Organic and inorganic chemicals 2792 Plastics and rubber and articles thereof 1860 Textile and textile articles 15564 Coffee, tea mate and spices 526 Cereals 10082 Prepared foodstuffs, beverages, spirits and vinegar 3685 Base metals and article of base metals 4451 Machinery and mechanical appliances, electrical equipment and parts thereof 7718 Vehicles, aircraft, vessels and associated transport 3019 Salt, sulphur, earth and stone, plastering materials 2360 Mineral fuels, mineral oils and products of their distillation, bituminous substances, mineral waxes 2749 Tanning and dyeing extracts 1052 Paper and paper board and articles thereof 841 Other commodities 3733
Iran 568
Edible fruits and nuts peel of citrus fruits or melons 211 Textile and textile articles 85 Ships boats and floating structures 34 Other commodities 238
Myanmar 1095
Cereals 386 Wood and articles of woods and wood charcoal 574 Other commodities 135
14 Nepal 351
Edible vegetables and certain roots and tubers 267 Other commodities 84
Pakistan 4766
Prepared foodstuffs, beverages, spirits and vinegar 284 Mineral fuels, mineral oils and products of their distillation, bituminous substances, mineral waxes 194 Textile and textiles articles 2822 Machinery and mechanical appliances, electrical equipment and parts thereof 288 Ships boats and floating structures 192 Other Commodities 986
Sri Lanka 436
Animals and animal products 82 Plastics, rubber and articles thereof 70 Textile and textiles articles 93 Other commodities 191 ______Total 72,296 ______Source: Statistics Department, Bangladesh Bank
Bangladesh's Trade in Major Services With ACU Countries In 2001
Bhutan
Services (net) (A-B) -2 A.Receipts 9 B.Payments 11 1.Transportation 4 1.Transportation 0 2.Travel 4 2.Travel 5 a)Commercial 0 a)Commercial 0 b)Education 0 b)Education 0 c)Tourist 0 c)Tourist 4 d)Other 4 d)Other 1 3.Communication Services 0 3.Communication Services 0 4.Insurance Services 0 4.Insurance Services 0 5.Bank Commission and Charges 0 5.Bank Commission and Charges 0 6.Misc. Business, Professional 0 6.Misc.Business, Professional 0 & Technical Services & Technical Services 7.Government Services n.i.e 1 7.Government Services n.i.e 6
15 India
Services (net) (A-B) -44 A.Receipts 994 B.Payments 1038 1.Transportation 34 1.Transportation 21 2.Travel 80 2.Travel 622 a)Commercial 0 a)Commercial 47 b)Education 2 b)Education 60 c)Tourist 55 c)Tourist 261 d)Other 23 d)Other 254 3.Communication Services 2 3.Communication Services 0 4.Insurance Services 4 4.Insurance Services 3 5.Bank Commission and Charges 26 5.Bank Commission and Charges 92 6.Misc. Business, Professional 186 6.Misc.Business, Professional 111 & Technical Services & Technical Services 7.Government Services n.i.e 662 7.Government Services n.i.e 189
Iran
Services (net) (A-B) -16 A.Receipts 15 B.Payments 31 1.Transportation 4 1.Transportation 0 2.Travel 1 2.Travel 2 a)Commercial 0 a)Commercial 0 b)Education 0 b)Education 0 c)Tourist 0 c)Tourist 2 d)Other 1 d)Other 0 3.Communication Services 0 3.Communication Services 0 4.Insurance Services 0 4.Insurance Services 0 5.Bank Commission and Charges 9 5.Bank Commission and Charges 0 6.Misc. Business, Professional 0 6.Misc. Business, Professional 3 & Technical Services & Technical Services 7.Government Services n.i.e 1 7.Government Services n.i.e 26
Myanmar
Services (net) (A-B) -27 A.Receipts 6 B.Payments 33 1.Transportation 1 1.Transportation 0 2.Travel 2 2.Travel 3 a)Commercial 0 a)Commercial 1 b)Education 0 b)Education 0 c)Tourist 0 c)Tourist 2 d)Other 2 d)Other 0 3.Communication Services 0 3.Communication Services 0 4.Insurance Services 0 4.Insurance Services 0 5.Bank Commission and Charges 0 5.Bank Commission and Charges 0 6.Misc. Business, Professional 0 6.Misc. Business, Professional 0 & Technical Services & Technical Services 7.Government Services n.i.e 3 7.Government Services n.i.e 30
16 Nepal
Services (net) (A-B) 9 A.Receipts 71 B.Payments 62 1.Transportation 0 1.Transportation 0 2.Travel 39 2.Travel 23 a)Commercial 0 a)Commercial 2 b)Education 17 b)Education 2 c)Tourist 4 c)Tourist 12 d)Other 18 d)Other 7 3.Communication Services 0 3.Communication Services 0 4.Insurance Services 0 4.Insurance Services 0 5.Bank Commission and Charges 0 5.Bank Commission and Charges 0 6.Misc. Business, Professional 27 6.Misc. Business, Professional 2 & Technical Services & Technical Services 7.Government Services n.i.e 5 7.Government Services n.i.e 37
Pakistan
Services (net) (A-B) 29 A.Receipts 114 B.Payments 85 1.Transportation 31 1.Transportation 9 2.Travel 25 2.Travel 30 a)Commercial 21 a)Commercial 4 b)Education 1 b)Education 3 c)Tourist 1 c)Tourist 13 d)Other 2 d)Other 10 3.Communication Services 0 3.Communication Services 0 4.Insurance Services 0 4.Insurance Services 0 5.Bank Commission and Charges 1 5.Bank Commission and Charges 10 6.Misc. Business, Professional 18 6.Misc. Business, Professional 5 & Technical Services & Technical Services 7.Government Services n.i.e 39 7.Government Services n.i.e 31
Sri Lanka
Services (net) (A-B) -18 A.Receipts 121 B.Payments 139 1.Transportation 30 1.Transportation 99 2.Travel 4 2.Travel 22 a)Commercial 0 a)Commercial 3 b)Education 0 b)Education 1 c)Tourist 2 c)Tourist 12 d)Other 2 d)Other 6 3.Communication Services 0 3.Communication Services 0 4.Insurance Services 0 4.Insurance Services 0 5.Bank Commission and Charges 2 5.Bank Commission and Charges 0 6.Misc. Business, Professional 60 6.Misc. Business, Professional 4 & Technical Services & Technical Services 7.Government Services n.i.e 25 7.Government Services n.i.e 14
17 BHUTAN
In the year 2000, as per the latest information published by the Central Statistical Organization (CSO), the real GDP is estimated to have grown by 6.1 per cent, marginally faster than the 5.9 per cent of the previous year. The Construction Sector, with an estimated growth of about 20 pr cent - although lower than the 25 per cent of the previous period - continues of exert a major influence on the GDP growth. This, in turn, is mainly due to the ongoing construction of large hydropower projects, such as Tala, Kurichu and Basochu. The growth in other major sectors, which includes Mining and Quarrying, Manufacturing and Electricity, taken together, is estimated to weaken to 6 per cent in 2000 from 7 per cent of the previous year, partly reflecting the devastating effects of the flood that accrued in August 2000. However, the decline in this sector is expected to be compensated by the performance in the Transport, Storage, and Communications sector, with estimated growth of about 6 per cent, compared to a growth of 5 per cent in the previous period. During 2000-2001, the growth of money supply slowed, with Narrow Money (M1) growing by 21.3 per cent, as compared to 28.7 per cent in 1999-2000, and Broad Money (M2) by 5.5 per cent, as compared to 21 per cent in the previous period. The reduction in M2 growth was mainly due to the negative growth (of 5 per cent) in Quasi Money. The Rate of inflation, as measured by the Consumer Price Index (CPI), decreased to 3.6 per cent (year-to-year rate of change) as of June 2001, as compared to the 4.4 per cent for December 2000. During the review period, Bhutan's overall exports and imports increased by approximately 4 and 23.7 per cent respectively. The capital inflows through grants and loans during the year had more than offset the Trade and Current Account Deficits, and, thereby, contributed to a positive Overall Balance of Payments. On the fiscal side, as per the available budget estimates, the total expenditure increased by 12.5 per cent during the current period, far exceeding the increase of 7 per cent in the total revenue and grants. This resulted in a budget deficit of Nu. 1,296.6 million, which works out to 6 per cent of the GDP, almost double that of the previous period. On the medium term macroeconomic prospect of the country, as per the preliminary estimates based on the 9th plan outlay, the macroeconomic prospects in the Plan period are favorable. The expected capital investments and the completion of three power projects during the Plan period (Kurichu, Basochu and Tala) are estimated to raise economic growth from the present rate of 6.5 per cent to about 8 per cent. Further economic growth is envisaged to come through broadening and strengthening the Private Sector activities in the economy. With the fiscal deficit projected at about 2-3 per cent of GDP and the policy emphasis on Private Sector development, the domestic investment environment is expected to improve in the near future, relieving the Financial Sector from the current problem of excess liquidity. Unlike the high monetary growth experienced in the past, mainly fuelled by Net Foreign Assets, the Money Supply is projected to stabilize at about 11-13 per annum, well in line with the expected growth of nominal GDP. The External Sector will continue to be dominated by close trade and exchange links with India. As more economic activities are envisaged in the Ninth Plan, the Current Account Deficit in the Balance of Payments is expected to widen further during the period. As an import-dependent economy, the expansion of domestic activities entails use of Foreign Currency Reserves, limiting the influence of the External Sector on the monetary expansion, which was experienced in the 8FYP. Nevertheless, the projected capital inflow in the 9FYP would not only be sufficient to cover
18 the Current Account Deficit, but it is also forecasted to allow the Foreign Exchange Reserves to grow at about 10 per cent per annum.
19
MAIN ITEMS OF GOODS AND SERVICES TRADED WITH ACU COUNTRIES IN 2001 EXPORTS
To Bangladesh:
Goods Fresh oranges and apples; mixtures of fruit products; dolomites; limestone; quartzite, boulders
Services -
To India:
Goods Electrical energy; calcium carbide; portland cement; ferro- silicon; particleboard; oranges; mixtures of fruit products; potatoes; wheat flour
Services Tours and travels; banking services
To Nepal:
Goods Coal bituminous and gypsum
Services -
IMPORTS
From Bangladesh:
Goods Garments; table & kitchenware of plastics; medicines; condensed milk; biscuits, wafers & waffles; copper wire of refined copper; plastic container, batteries for vehicles
Services Travels and use of airport
From India:
20 Goods Computers & parts; passengers motor cars; diesel; trucks; spares for bulldozer and angledozer; wheat; angle of iron and steel. rice; edible oil
Services Skilled and semi-skilled labours; tours & travels; consultancy; use of airport; banking & insurance and education
From Nepal:
Goods Computers; nodules; tubes, pipes and hollow profiles of cast iron; tents of cotton & other material; washing soap: overcoats and wind jackets; garments; leather shoes; cotton blankets; biscuits; beer
Services Travels and use of airport
21 INDIA
The Indian economy recorded a growth rate of 4.0 per cent in 2000-2001 as against 6.1 per cent in 1999-2000 and 6.6 per cent in 1998-1999. The slow down in growth in 2000-2001 reflected the impact of two consecutive years of below-average monsoons, a downturn in industrial growth after promising signs of revival in 1999-2000, the strains imposed by droughts and floods in various parts of the county and the unprecedented severity of the Gujarat earthquake. Despite this slowdown, India's growth rate was higher than most other developing (excluding China) and advanced economies. The data for 2001-2002 fiscal so far indicate the continued persistence of the deceleration of the Indian economy in line with the global slow down although real GDP growth in the second quarter of 2001-2002 at 5.3 per cent showed an improvement over 4.4 per cent recorded in the preceding quarter. While agriculture has picked up, industry and services sector continue of decelerate.
Agriculture
GDP growth in 'agricultural and allied activities' turned negative in 2000-2001 with the growth rate being -0.2 per cent, down from 1.3 per cent in 1999-2000 and 7.1 per cent in 1998-1999 but improved to 2.3 per cent and further to 3.4 per cent in the first and second quarters of 2001-2002 respectively due to well distributed monsoon. Agricultural production (in terms of index of agricultural production) recorded declines for the second successive year in 2000-2001; it exhibited a negative growth of 6.5 per cent in 2000-2001 (as against -0.9 per cent in 1999-2000). However, during 2001-2002 so far, agricultural production recorded a distinct improvement, reversing the negative growth of the previous two years, with kharif foodgrains production touching a new peak (105.59 million tonnes as of end September 2001).
Industry
Industrial production in terms of IIP decelerated to 5.1 per cent during 2000-2001 from 6.7 per cent in 1999- 2000. Further, the growth fell sharply to 2.3 per cent in 2001-2002 (up to December) from 5.8 per cent in April- December 2000, with all the three sectors (manufacturing, mining and electricity) exhibiting sharp deceleration. Capital goods production index recorded an absolute decline (of 4.8 per cent) over the same period while basic, intermediate and consumer goods production indices exhibited sharp decelerations, nearly half of that recorded in the comparable period of the previous year.
Services
Growth in services sector that had averaged over 8.5 per cent over 1994-2000 decelerated to 5.0 per cent in 2000-2001. Nonetheless, growth in services subsectors have shown different patterns, with growth in finance, insurance, real estate, and business services accelerating to above 10 per cent in the second quarter of 2001-2002, while growth in
22 trade, hotels, transport, communication and in community, personal and social services remaining comparatively weak. 'Construction' sector growth that hovered around 8.4 per cent for the first two quarters of 2000-2001 declined to 0.7 per cent in the last quarter of 2000-2001, but picked up again to around 4.1 per cent in the second quarter of 2001-2002.
Savings and Investment
Quick estimates of CSO indicate a marginal pick up in gross domestic saving rate to 23.4 per cent in 2000-2001 from 23.2 per cent in 1999-2000 and 22.0 per cent in 1998-1999. This was mainly on account of improvement in household savings rate from 20.3 per cent of GDP in 1999-2000 to almost 21 per cent of GDP in 2000-2001. Private corporate sector also showed an improvement from 3.7 per cent of GDP in 1999-2000 to 4.2 per cent of GDP in 2000- 2001. Gross savings rate would have crossed the 25 per cent mark (last seen only in 1995-1996), but for the dissaving recorded by public sector to the extent of 1.7 per cent of GDP. Gross domestic investment has however exhibited mixed trend. After rising from 23.0 per cent in 1998-1999 to 24.3 per cent in 1999-2000, it declined modestly to 24.0 per cent in 2000-2001.
Price Developments
The point-to-point inflation rate as measured by Wholesale Price Index (WPI) was 4.9 per cent in 2000-2001 as compared to 6.5 per cent in 1999-2000. The significant fall in inflation in March 2001 could be attributed to the base effect correction and sluggishness in investment demand and the presence of excess capacity in various industries that dampened manufacturing inflation pressures. Excluding the price increases of the administered items, the inflation rate works out to 2.6 per cent for 2000-2001. However, notwithstanding the year end decline, the high order of inflation during the major part of 2000-2001 represented a rise in the average rate of inflation (on a weekly basis) to 7.2 per cent in 2000-2001 as against 3.3 per cent in 1999-2000. Inflation, as measured by year-on-year change in wholesale prices, decelerated further to 1.13 per cent as on February 2, 2002 as against 8.62 per cent a year ago, reflecting the waning of the effects of successive rounds of administrative price revisions in 2000-2001, improvement in agricultural production, the continuing slack in manufacturing prices, and the absence of demand pressures.
Fiscal Developments
The gross fiscal deficit of the centre in the revised estimates (RE) for 2000-2001, at Rs. 111,972 crore or 5.1 per cent of GDP, remained almost at the level of the budget estimates (Rs. 111,275 crore) and the revenue deficit in the revised estimates at Rs. 77,369 crore (3.5 per cent of GDP) was marginally lower than the budgeted level of Rs. 77,425 crore. While expenditure contracted by 0.9 per cent (0.2 percentage point in terms of GDP), revenue receipts registered and increase of 1.2 per cent (0.1 percentage point in terms GDP). The increase was mainly on account of non-tax revenue (Dividends and profits that surpassed budget target by 26.4 per cent), through tax revenue suffered a decline of 1.2 per cent. The fiscal outcome of States in RE for 2000-2001 showed some improvement over the previous year. The
23 gross fiscal deficit at 4.4 per cent of GDP for 2000-2001 (RE) was lower than 4.7 per cent in the previous year. The revenue deficit declined from 2.7 per cent of GDP in 1999-2000 to 2.3 per cent of GDP in 2000-2001 and primary deficit declined from 2.4 per cent of GDP to 1.9 per cent of GDP over the same period. Accordingly, the combined gross fiscal and revenue deficit of centre and states narrowed to 9.1 per cent and 5.9 per cent of GDP respectively in 2000- 2001 as compared with 9.4 per cent and 6.2 per cent in 1999-2000. However, there has been a deterioration in the centre's fiscal situation during the first nine months of current fiscal year mainly due to a decline in tax revenue and increase in expenditure as compared with corresponding period last year. Gross fiscal deficit of the Central Government at Rs. 89,014 crore up to December 2001 was higher by about 37.7 per cent over the corresponding period of the last year and constituted about 76.5 per cent of the budget estimate for the current year. Similarly, revenue deficit (Rs. 66,559 crore) accounted for around 84.4 per cent of the budget estimate for the year as a whole. The State Budgets for 2001-2002 lay emphasis on fiscal consolidation through revenue augmentation and expenditure containment measures. The resource gap measured in terms of revenue deficit and gross fiscal deficit as a ratio of GDP is expected to decline in 2001-2002. In terms of GDP, the revenue deficit and gross fiscal deficit are estimated to decline from 2.3 per cent and 4.4 per cent in 2000-2001 (RE) respectively to 1.9 per cent and 3.9 per cent in 2001-2002 respectively. Though no information is available on the fiscal outturn of states for the current year so far, the state finances are expected to remain under pressure given their high recourse to WMA from the Reserve Bank in the current fiscal year (up to December 21, 2001) as compared to last year.
Monetary Policy Developments
Board money (M3) increased by 16.7 per cent during 2000-2001 as compared with the growth of 14.6 per cent in 1999-2000. However, net of India Millennium Deposits (IMDs), the M3 growth rate was at 14.4 per cent, in line with the projection for the fiscal year. Reserve Money increased at a slower rate of 8.1 per cent (Rs. 20,969 crore) during 2000-2001 as compared with 8.2 per cent during 1999-2000. The increase in reserve money during 2000-2001 essentially emanated from an accretion to the Reserve Bank's net foreign currency assets (Rs. 27,463 crore, adjusted for revaluation, as against an increase of Rs. 27,382 crore during 1999-2000). The net domestic assets (NDA) of the Reserve Bank underwent a compensating decline of Rs. 4,444 crore (adjusted for revaluation) in 2000-2001 as compared with a decline of Rs. 6,528 crore in 1999-2000. Net bank credit to Government increased to 16.1 per cent during 2000-2001 as compared with 14.1 per cent during the previous year. While scheduled commercial bank's investments in Government securities declined to 22.3 per cent during 2000-2001, net Reserve Bank credit to the Government recorded an increase of 3.8 per cent as compared with a decline of 2.8 per cent the year before (of which RBI credit to centre recorded a growth of 4.8 per cent in 2000-2001 as compared with a decline of 3.8 per cent in (1999-2000). Liquidity conditions have remained comfortable during 2001-2002 so far even though the year-on-year M3 expansion at 13.9 per cent as on February 8, 2002 was below the indicative target of about 14.5 per cent set for the year as a whole; the year-on-year growth in M3 was at 16.5 per cent (14.2 per cent net of IMDs) as on February 9, 2001. During the fiscal year so far (February 8), bank credit to the commercial sector decelerated to 9.4 per cent from 12.7 per cent in the corresponding period of the previous year, reflecting the downturn in industrial production. Net bank
24 credit to the Government during this period increased by 13.5 per cent which is almost the same as that of corresponding period last year. Reserve money increased by 6.9 per cent during the current financial year up to February 9, 2002 as against 5.2 per cent during the corresponding period of the previous year, primarily driven by the accretion to the Reserve Bank's foreign currency assets (net of revaluation) which rose by Rs. 35,399 crore as against an increase of Rs. 21,888 crore during corresponding period of previous year. Net Reserve Bank credit to the Centre decelerated to 2.2 per cent as against 6.9 per cent in the corresponding period of the previous year.
External Sector
Trade
According to the provisional data released by the Directorate General of Commercial Intelligence and Statistics (DGCI & S), India's exports at US Dollars 44.6 billion recorded a growth of 21.0 per cent during 2000-2001, much higher than 10.8 per cent during 1999-2000. Imports, on the other hand, increased only marginally from US Dollars 49.6 billion to US Dollars 50.5 billion recording a growth of 1.7 per cent during 2000-2001. While the deficit on the oil account widened, the non-oil imports recorded a decline, reflecting weak domestic demand and subdued industrial activity. Accordingly, the trade deficit declined by almost half to around US Dollars 6 billion in 2000-2001. The current account deficit (CAD) in 2000-2001 was contained at US Dollars 2,579 million (0.5 per cent of GDP) as compared with US Dollars 4,698 million (1.0 per cent of GDP) in 1999-2000. This was possible mainly because of a robust growth in exports and a surge in private transfers and soft ware exports. Exports growth slackened to only 0.6 per cent during April-December, 2001 from 21.0 per cent in the corresponding period of 2000-2001 reflecting the slowdown in global economic activity. Imports recorded a marginal increase of 0.1 per cent as compared with that of 4.7 per cent during the corresponding period of the previous year, reflecting further decline in oil imports and the subdued overall domestic demand. Accordingly, trade deficit, declined to US Dollars 5.76 billion during April-December 2001 as compared to US Dollars 5.9 billion during corresponding period last year.
Foreign Exchange Reserves
India's foreign exchange reserves comprising of foreign currency assets and gold held by RBI and Special Drawing Rights (SDRs) held by the government increased by US Dollars 4,245 million during 2000-2001 to US Dollars 42,281 million by end March 2001. During the current financial year so far, there has been a handsome accumulation of US Dollars 7.9 billion. As a result foreign exchange reserves increased to US Dollars 50.2 billion by mid-February 2002. The import cover of reserves improved from 8.6 months of imports as at end March 2001 to more than 11 months of imports.
25 External Debt
India's external debt increased from US Dollars 98.3 billion as at end March 2000 to US Dollars 100.4 billion as at end March 2001 before decreasing to US Dollars 98.3 billion at the end of June 2001. Almost all components of external debt, except long term non resident deposits declined during the second quarter of 2001-2002. There has also been considerable improvement in the major debt sustainability indicators. The external debt-GDP ratio declined from 23.4 per cent as at end-March 1999 to 21.9 per cent as at end-March 2000 and further to 21.5 per cent at end-March 2001. Short-term debt remained modest in proportion to total debt and reserves. The proportion of short-term debt to total debt declined from 4.1 per cent as at end-March 2000 to 3.4 per cent as at end-March 2001 and further to 3.2 per cent at end June 2001. As a proportion to reserves, short-term debt declined significantly from 10.3 per cent at end March 2000 to 8.2 per cent at end March 2001 and further to 7.2 per cent at end June 2001.
26 Exchange Rate
The developments in exchange rate during 1999-2000 reflected the policy stance of focusing on managing volatility while allowing underlying demand and supply conditions to determine exchange rate movements. The exchange rate of the Indian rupee vis-a-vis the US Dollar traded within a range of Rs. 43.61 - Rs. 46.81 during 2000- 2001, with the range being narrower for the period November 2000-March 2001 (Rs. 46.35 - Rs. 46.89). For the financial year 2000-2001 as a whole, the exchange rate averaged Rs. 45.68 per US Dollar recording a depreciation of about 5.1 per cent over the average of RS. 43.33 per US Dollar during the previous year. The rupee, however, appreciated by 3.4 per cent and 8.0 per cent during 2000-2001 against the pound sterling and the Euro respectively. Foreign exchange markets exhibited stable conditions during April-August 2001 supported by inflows on account of FIIs, FDI, non-resident deposits and raising resources via ADR/GDRs by Indian corporates. Rupee traded within the range of Rs. 46.64 - Rs. 47.15 over the same period, exhibiting a marginal depreciation of 1.1 per cent. Even the downgrading of India's sovereign outlook in August 2001 did not have any impact. However, market sentiment was adversely affected after the September 11 attack resulting in a depreciation of Indian rupee from Rs. 47.45 per US Dollar on September 11, 2001 to Rs. 48.18 per US Dollar on September 17, 2001. However, normalcy soon returned and forex markets have exhibited relatively stable conditions during October 2001-January 2002 with a steady supply of dollar and modest corporate demand. As on February 15, 2002, the exchange rate of Rupee was Rs. 48.705 per US Dollar, showing a depreciation of around 4 per cent, compared with the rate of Rs. 46.640 at the end of March 2001.
27 MAIN ITEMS OF GOODS AND SERVICES TRADED WITH ACU COUNTRIES IN 2001 (In Million US Dollars) EXPORTS
2000-2001 (April-March P) Commodity Group (1)
1.Engineering goods 586.7 2.Chemicals & related products 495.9 3.Cotton yarn, fabrics, madeups etc. 299.3 4.Sugar & molasses 76.6 5.Rice 71.2 6.Paper/wood products 64.9 7.Manmade yarn, fabrics, madeups 61.3 8.Oil meals 50.5 9.Pulses 45.3 10.Spices 42.0 11.Coal 35.9 12.Fresh vegetables 30.1 13.Readymade garments 28.5 14.Wheat 25.9 15.Tea 25.2 16.Misc. processed items 22.5 17.Fresh fruits 15.8 18.Other ores & minerals 14.8 19.Marine products 14.5 20.Meat & preparations 13.0 21.Iron ore 12.7 22.Poultry & dairy products 10.7 23.Processed minerals 10.6 24.Tobacco 9.9 25.Natural silk yarn, fabrics, madeups 4.7 26.Cotton raw incl. waste 4.4 27.Others 110.7
Total Exports 2,183.6 ______P: Provisional. Source : DGCI & S.
28 IMPORTS
2000-2001 (April-March P)
Commodity Group (1)
1.Wood & products 148.9 2.Chemicals, organic & inorganic 96.2 3.Textile yarn, fabrics, madeup articles 64.3 4.Fruits & nuts excl. cashew nuts 60.0 5.Non-ferrous metals 52.1 6.Pulses 49.7 7.Essential oil, cosmetic preparation 31.9 8.Iron & steel 24.0 9.Spices 22.8 10.Fertilizers 22.0 11.Jute, raw 18.0 12.Metalliferrous ores & metal scrap 16.7 13.Medicinal & pharmaceutical products 9.3 14.Leather 7.4 15.Paperboard & manufactures 5.1 16.Vegetable oils fixed (edible) 5.0 17.Machinary excl. electric & electronic 4.9 18.Manufactures of metals 4.1 19.Tea 3.8 20.Sugar 2.3 21.Cotton raw, comb/uncomb & waste 2.0 22.Cereal & preparation 2.0 23.Artifical resins, plastic material etc. 2.0 24.Rubber 1.5 25.Wool, raw 1.0 26.Petroleum, crude & products n.a. 27.Others 201.5
Total Imports 858.5 ______P : Provisional. Source : DGCI & S.
29 India's Foreign Trade (In Million US Dollars)
April-March ______Year 1999-2000 2000-2001 P ______
Exports 36,822.4 44,560.3 (10.8) (21.0) IMPORTS 49,670.7 50,536.5 (17.2) (1.7) Trade Balance -12,848.3 -5,976.2
______Figures in brackets relate to percentage variation over the corresponding period of previous year. P : Provisional. Source : DGCI & S.
India's Trade With ACU Countries (In Million US Dollars)
April-March ______Country 1999-2000 2000-2001 P EXPORTS IMPORTS EXPORTS IMPORTS ______1.BANGLADESH 636.3 78.2 935.0 80.4 2.BHUTAN 7.6 18.0 1.1 21.1 3.IRAN 152.1 1,251.3 227.0 211.2 4.MYANMAR 34.1 171.6 52.7 181.7 5.NEPAL 151.2 188.6 140.8 255.1 6.PAKISTAN 92.9 68.2 186.8 64.0 7.SRI LANKA 499.3 44.2 640.1 45.0
ACU 1,573.5 1,820.1 2,183.6 858.5 ACU'S Percentage (4.3) (3.7) (4.9) (1.7) to India India's total trade 36,822.4 49,670.7 44,560.3 50,536.5 ______Figures in brackets relate to percentage share of ACU to India's total. P : Provisional. Source : DGCI & S.
30
TRADE THROUGH EPZ AND EOU (In Million US Dollars)
India's Exports Through EPZs/EOUs ______Year EPz's EOU's Total ______
1993/94 624.9 983.9 1,608.8 (2.8) (4.4) (7.2)
1994/95 845.0 1,500.1 2,345.0 (3.2) (5.7) (8.9)
1995/96 967.3 2,095.4 3,062.7 (3.0) (6.6) (9.6)
1996/97 1,222.2 2,458.8 3,681.0 (3.7) (7.3) (11.0)
1997/98 1,296.2 2,765.7 4,061.9 (3.7) (7.9) (11.6)
1998/99 1,248.5 2,866.2 4,114.7 (3.8) (8.6) (12.4)
1999/2000 1,540.1 3,276.9 4,817.1 (4.2) (8.9) (13.1)
2000/2001 1,193.9 2,775.8 3,969.7 (April-December) (3.7) (8.6) (12.3)
______
Note: Figures in brackets relate to share in India's total exports. Exports through EOUs during 1999-2000 and 2000-2001 are provisional.
Source:Annual Report 2000-2001, Ministry of Commerce.
31 IRAN
The upward trend in economic activity, which started in 1378 (1999-2000) in Iran, continued in 1379 (2000- 2001) and 1380 (2001-2002). Over the last two years, sound economic policies particularly on enhancing viability of external sector and substantial reserve buildup, strengthened output growth and investment performance and improved economic conditions considerably. Exchange market reforms and government policy on oil income sterilization created and enhanced an stable environment with balanced growth and low inflation. Preliminary estimates for major variables in (2001-2002) indicate that real GDP and capital formation grew by 4.5 and 12.1 per cent respectively. Real GDP growth in (2001-2002) was mainly spurred by the growth of manufacturing, construction and service sectors. Furthermore, gross fixed capital formation has rebounded in (2000-2001) and (2001-2002), after two consecutive year of sluggish growth. While international oil market developments had positive impact on GDP growth in (2000-2001), the gradual decline in world oil prices from the beginning of 2001 led to declining trends on balance of payments current account surplus and negative contribution of oil sector on growth attainment in (2001-2002). The sharp decline of international oil prices in the aftermath of September 11, 2001 events and world economic recession unfavorably affected output growth in the Iranian economy, specially in the second half of 1380 (2001-2002). The negative contribution of oil sector on GDP growth in (2001-2002) and the lower than expected non oil export performance contributed to lower than projected output growth compared with growth target of the 3rd Five Year Development Plan (FYDP).
Labor Market
Employment opportunities and job creation policies have been the government main concern in recent years. Extensive measures were implemented in (2001-2002) in generating new job opportunities in observance of 3rd FYDP targets. On the basis of data released by the Management and Planning Organization, almost 390 thousand new employment opportunities were generated during (2001-2002) raising the number of employed population to 16,071 thousand persons, while the unemployment rate stood at 16 per cent. Iran's labor market is affected by factors such as young population, high growth of active population, migration from rural to urban areas, and structural bottlenecks on new job creation. The government has implemented extensive measures to raise production and investment, particularly labor-intensive investments during the previous year. Allocation of US Dollars one billion foreign exchange loan from the Oil Stabilization Fund (OSF) to private and cooperative sectors and a new foreign financing facility of another US Dollars one billion for the execution of job creating projects according to Note 29 of (2001-2002) budget law are among government measures in this context. However, overcoming high unemployment rate not only requires substantial amount of investment and growth, but also implementation of extensive structural reforms and preparation of appropriate economic environment conductive to private sector participation in economic activities is needed. Measures adopted by the government since the beginning of 1379 (March 21, 2000) have provided appropriate grounds in the economy, which must be supported and reinforced by reform policies in various aspects of the economy.
32 Government Budget and Finance
Despite significant fiscal consolidation efforts during the last two years, the preliminary figures on government budget indicate that in the year (2001-2002), the tax revenue and other government revenue show under realization compared to the approved budget. Although the decline in international crude oil prices did not affect government budget negatively due to conservative assumptions on budget oil revenue, however, nonrealization of tax and other budget revenue by 14.5 and 32.4 per cent deteriorated the balance of the budget and led to budget amendment in February 2002. With (2001-2002) budget amendment the shortages of tax and other revenue vis-a-vis the approved level were compensated by higher allocation of oil revenue. In the year (2001-2002), the government revenue, with a 19.0 per cent rise compared to the similar period of the previous year, reached Rls. 128,860 billion, which was realized by 91 per cent of the approved budget. Oil and gas revenues, with 21 per cent rise compared to similar period of the previous year reached Rls. 71,957 billion, realizing 5 per cent more than the approved budget. Government expenditure with a rise of 19 per cent compared to the same period of the last year, amounted to Rls. 128,860 billion, indicating 91 per cent realization compared to the approved budget. Hence, considering general budget revenues and expenditures, the budget deficit (excluding the Oil Stabilization Fund) amounted to Rls. 616 billion in (2001-2002). When assessing Iran's fiscal performance, it is noteworthy that the ongoing improvements in government budget during the last two years was made possible on account of conservative price projection for crude oil exports. This bold fiscal consolidation effort has made it possible for the government to buy back large amounts of its domestic and external debts. The oil export receipts of (2000-2001 , 2001-2002) was partly utilized to build up the reserve position of the Central Bank and with the extra receipts in (2000-2001) and (2001-2002), large amounts of government foreign savings where sterilized in oil stabilization fund.
Balance of Payments
The prevailing recession of the world economy and the tragic events of the September 11 in the United States in (2001-2002) reduced the world demand for crude oil, which in turn decreased Iran's crude export price by 15.1 per cent in the year 2001-2002, as compared to the respective period of the previous year. Thus, by the end of 2001 Iranian crude oil average prices declined to US Dollars 21.4 per barrel, despite limited rise in the amount of export, and foreign exchange revenue from oil and gas exports fell by 20.4 per cent and amounted to US Dollars 19,339 million in (2001- 2002). However, non-oil exports faced a relatively favorable trend in this period due to the reforms in foreign exchange and trade regulations, provision of banking facilities in domestic and foreign currency to foreign trade sector, exemption of exporters from taxes and levies, and stability in the exchange market. On the whole, the non-oil exports and imports grew, respectively, by 4.7 and 20.2 per cent in (2001-2002). Thus, the trade balance, taking into account receipts from oil exports, faced a surplus US Dollars 5,578 million. During this year, the services balance run a deficit of US Dollars 1.5 billion, showing an increase of 11.3 per cent as compared to the previous year. The current account of BOP faced a surplus of US Dollars 4.5 billion in (2001-2002), showing a reduction of 64.0 per cent as compared to the respective period of the previous year. Increase in imports by 20.2 per cent and reduction in export of oil and oil products by 20.4 per cent were among important factors behind the above-mentioned
33 reduction. In (2001-2002), the net capital account faced a deficit of US Dollars 3 billion. The Central Bank international reserves and oil stabilization fund showed an increase of US Dollars 4,941 million during this period. In this period, the average value of U.S. dollar against Iranian Rial in Tehran Stock Exchange (TSE) and parallel markets were stable comparing with the respective of period of (2000-2001). The standard deviation of monthly dollar rate indicates that this deviation has been Rls. 9.1 in the parallel market in March 2002, showing a lower fluctuation as compared to the previous month. During the year ( 2001-2002), transactions on Certificate of Deposit (CD) in foreign currencies1 in the (Tehran Stock Exchange) grew by 75.3 per cent, and amounted to US Dollars 4,853 million, against US Dollars 2,769 million in the respective previous period. Improvement in the external sector of the economy provided ground for higher investment and output and helped reduce the sovereign risk of the country. The strong external position and the accumulation of foreign reserves in the Oil Stabilization Fund (OSF) in (2000-2001) and (2001-2002), while smoothing government revenue in case of oil price fluctuations, made it possible to allocate part of foreign exchange revenues to productive activities and investment in (2001-2002). With the elimination of the export rate in foreign exchange transactions, as of the beginning (1999-2000), the exchange rates applicable to foreign exchange transactions were limited to the official exchange rate, which was the oil national rate for government budget purposes, and the market-related certificate of deposits rate (CD), which was applied for other transactions. In (2000-2001), commercial banks authorized to buy and sell foreign currency at CD and negotiated rate for private sector transactions. The positive trends on external debt developments continued in (2001-2002), declining the debt to US Dollars 5,993 million at the end of the eleven month of (2001-2002) against US Dollars 7,952 million in the respective period of the previous year.
Money and Banking
In the year of (2001-2002), the monetary and credit-policies were implemented with the aim of budget financing, provision of fund for investment projects, control of liquidity, and constraining inflation and inflationary expectations. Although the new monetary and foreign exchange policies have led to import improvement and foreign exchange selling, yet increased demand for foreign exchange was not sufficient to neutralize the expansionary effects of budgetary financing. Thus, in order to control market liquidity and inflation, the Central Bank attempted to sell rials (Rls) 9,600 billion of participation papers in (2001-2002). ______
1. Includes US dollar, euro, Pound sterling, Yen, Swiss franc and UAE dirham.
In this period, reserve money increased about 11.6 per cent, compared to 17.5 per cent increase in the similar period of the previous year. Broad money growth also jumped to 28.8 per cent at the end of (2001-2002), almost about the rate prevailing in the previous year. Sterilization of a part of oil revenue in line with 3rd FYDP Act, prevented high oil revenue conversion into reserve money expansion. However, since (2000-2001) weak demand in foreign exchange
34 market and the low speed of reform in foreign trade entailed nonfulfillment of foreign exchange sale by the Central Bank in TSE market. This has led to higher than projected growth in money base and liquidity due to the Central Bank purchase of foreign exchange at TSE rate on its own account for budget fulfillment. During (2001-2002) similar to the previous year, banks expanded credit facilities to non-public sector at rates commensurate with higher demand for liquidity. This growth of bank facilities to the private sector and foreign exchange purchase by the CB from the government partially offset the impact of oil revenue sterilization in the year (2001-2002). The money multiplier accelerated to 3,409 at the end of (2001-2002). Drawndown of bank's excess reserves and decline in legal reserve ratios where the major reasons behind the increase in money multiplier. The combined effects of increased reserve money and accelerated money multiplier prompted the liquidity (M2) growth rate of 28.8 per cent in the year under consideration. Claims on non-public sector and sharp increase in net claims of the CB on public entities are the main factors contributing to monetary expansion. The credit performance of the banks in this period shows that banking facilities extended by banks and non- bank credit institutions to the non-public sector (excluding profit and revenues receivable), grew by 34.5 per cent and amounted to Rls. 203,792 billion. On this basis, the outstanding of commercial and specialized banks' claims on non- public sector grew by 35.8 and 29.9 per cent, respectively. During the same period the outstanding claims of non-bank credit institutions on the non-public sector grew by 144 per cent.
35 Price Trends
As a result of improvement in the balance of payments position, increased public confidence in economic stability, and implementation of non-expansionary fiscal policies, inflation rate stood at 11.4 per cent in (2001-2002) which was much lower than the figure projected in the plan. The downward trend of inflation, which started in the beginning of 1378 (1999-2000), continued in the (2000-2001) and (2001-2002). The declining trend of CPI during the past two years and the persistence of this trend was also seen in the wholesale price and producer price indices in (2001- 2002), so that the growth of the latter indices, with a sharp decline, stood at 5.1 and 10.9 per cent, respectively. Increase in the price index for "housing" and "food and beverages" had a significant share in rise of CPI during this period. The wholesale price index indicates that the highest share of increase was related to domestically produced and consumed goods, showing an increase in the domestic production cost, contrary to more favorable trend in the prices of "imported" and "exported" goods.
Capital Market
Following a sound economic condition and favorable atmosphere for investment, the Tehran Stock Exchange (TSE) activities enjoyed a bullish position in (2000-2001) and (2001-2002). Noticeable increase in the number and value of transactions, increase in public sector share offerings, improvement in the price and cash dividend indices, and increase in the number of companies accepted on the TSE are signs of boom in (2001-2002). In the year under review the price and cash dividend indices grew respectively by 26.2 and 13.8 per cent as compared to the previous year. It should be mentioned that the ratio of value of transactions in TSE to GDP reached to 1.2 per cent in (2001-2002).
36
MAIN ITEMS OF GOODS AND SERVICES TRADED WITH ACU COUNTRIES IN 2001
EXPORTS
To Bangladesh:
Sector Agriculture Cotton, dried and fresh fruits
Industry Tar and oil products, vaseline sulfur, cement, stones, floor covering, dentistry and hairstyling chairs, paraffin, marble stones, plastic products, hygienic products made of aluminum, stainless steel sinks, iron products, lightening, dentistry equipment, carpets, vehicles and spare parts, different woods for handicraft purposes, medical equipment, pastries
To India:
Sector Agriculture Tea-fresh and dried fruits, resins, fig, pistachio, dried vegetables, dried and fresh date
Industry Crude oil, petrochemicals (such as benzenes, butane, ethylene, propane, vaseline and paraffin), tar and its by-products, naphthalene, natural gas), aluminum alloys, derivatives of coal, chemicals, sulfur, marble and architectural stones, threads, carpets, pastries, zinc sheets, leather and taned skins, ores, synthetic fiber, pigment, iron and steel ingot, paper and paper products, carbon, copper products, rollers, plastic products, glass products, cauchou and cauchou products, sewing machines, tires, mineral water, lighting
37 To Myanmar:
Sector Industry Oil products, sword, dagger
To Pakistan:
Sector Agriculture Fresh and dried fruits, cotton, chocolates and pastries, vegetables and herb, date, resins
Industry Chemicals, tar and related products, cements, unwoven floor-coverings, spare parts for motor vehicles, pigment, leather and taned skins, clay, pump with meters, tires, cloth, plastic products, solvents, detergents, leather, glass products, pharmaceutical, marble and architectural stone, mills, buckles, mineral water, lightening, aluminum, carpets, valves, highway signs
To Sri Lanka:
Sector Agriculture Date, fruits
Industry Crude oil, tar, vaseline, chemicals, paraffin, sword, stainless steel sinks, cauchou, plastic products, bandages, lightening, carpets, zinc, wooden furniture
IMPORTS
From Bangladesh:
Sector Agriculture New wool and fleece, spices
38 Industry Mercerized threads, textiles made of natural and synthetic, moulds and casting equipment, material for carving
Services Letters of guarantee, transportation costs, assignment costs, salaries, transfers
From India:
Sector Agriculture Poultry, tea, herbs and spices
Industry Metal ores (enriched and ordinary), ether and esters, resins (except ester saps), alcohols, aluminum, pharmaceuticals, chemicals, vehicles and related spare parts, tanks and military equipment, rubber tires and tubes, bandages, wheelchairs, generators, aluminum pipes, cotton textiles, paper and paper products, buckles, natural waxes, graphite and related products, shifting and separating machines, asbestos and related products, lift trucks, moulds and casting equipment, furnaces vending machines, paraffin, meters, starches, vaseline, sulfur, packaging equipment, glass insulation, photography films, typewriters and calculators, plumbing equipment, cauchou and products made of cauchou, torches, mercerized threads, physiotherapy equipment, sewing machines, microphone and transformer, polymer products, synthetic and polishing stones, synthetic and natural fibers, natural sanding, wall paper, cutlery, insulative brick, tanning chemical, ledoxide, buttle cleaning and drying machines, mechanical rollers, pigment, hormones, iron and steel ingot, copper and copper products, centra fugal machines for filtering, fire extinguishing equipment, agricultural equipment, lenses, natural formentor, glass production
39 Services Letters of guarantee, transportation costs, communication costs, representative costs, legal fees, treatment cost, airport services, trainee expenses
From Pakistan:
Sector Agriculture Rice, cotton products, spices
Industry Labels, physiotherapy equipment, glass bubbles for insulation, wall paper and plastic adhesive sheets, thread of wool and fleece, cutlery, physiotherapy, cigarette papers, moulds equipment, resins, glues and gelatin
Services Letters of guarantee, insurance, transportation costs, refinancing charges, engineering services, communication costs, emergency purchases, installation costs, foreign exchange transfers
From Sri Lanka:
Sector Agriculture Tea, coconut, date, banana, pineapple, nutmeg, walnut, seeds, natural cauchou and saps
Industry Meters and measuring equipment, x-ray and radiology equipment
Services Transportation costs, subscriptions, transfers
40 MYANMAR
In implementing a second five-year short-term plan, which extends from 1996-1997 through 2000-2001, Myanmar has been able to achieve an annual growth rate of 8.4 per cent surpassing initial target of 6.0 per cent. This achievement can be attributed to the implementation of the plan in every sector and every region, the effective use of human resources of the nation, active participation of the people and the abundance of natural resources.
Sectoral Development in 2000-2001
Agriculture
Agriculture sector achieved a high growth rate of 14.1 per cent in 2000-2001, up from 10.5 per cent in the previous year. This growth was spurred by agricultural output supported by favorable weather conditions and, to a certain extent, the result of the land reclamation efforts, more extensive use of high yielding seed varieties, infusion of capital by private entrepreneurs and introduction of modern agricultural technology.
Mining
Mining and energy registered 27.8 per cent growth rate in 2000-2001. Mining sector achieved 27.1 per cent growth and energy sector sustained the growth rate of 30.8 per cent. These achievements were mainly due to the significantly increased private sector participation in the mining sector and increased production of newly found offshore gas fields, a majority of which is exported to Thailand.
Manufacturing and Processing
Manufacturing and processing sector achieved a record growth rate of 23.8 per cent. This growth was mainly contributed by the establishment of 18 industrial zones in nine States and Divisions and setting up of a total of 4,496 factories and plants in those industrial zones to date.
Services
Services sector, which consists of transportation, communication, financial institutions, social and administrative services, and rentals and other services registered a significant high growth rate of 12.2 per cent in 2000- 2001 compared to 8.8 per cent in the previous year.
Fiscal Sector
Budget revenue increased to 20.6 per cent of GDP in 2000-2001 from 18.6 per cent in 1999-2000, mainly due to
41 improvement in tax administration and collection. Consolidated budget expenditures also slightly increased to 25.8 per cent of GDP from that of 24.8 per cent during the same period. As a result, the overall fiscal deficit decreased to 5.2 per cent of GDP in 2000-2001 from that of 6.2 per cent in 1999-2000.
Monetary and Banking Sector Developments
Monetary growth in terms of M1 increased to 47.8 per cent in 2000-2001 from 32.3 per cent in 1999-2000. On the other hand, domestic credit growth significantly to 41.1 per cent in 2000-2001 from 24.5 per cent in 1999-2000. The interest rates remains unchanged from that of previous year. The Central Bank's discount rate is 10 per cent and the maximum lending and deposit rates are fixed at 15 per cent and 10 per cent respectively. Sales of 3 year and 5 year government treasury bonds initiated in December 1993 to partly finance the budget deficit, reached Kyat 135.72 billion at the end of March 2001. As private banks are introducing new products, one private bank has introduced trust service during 2001. Aggregate bank lending by the private banks increased by 78.3 per cent in FY 2000-2001 while the aggregate deposits also increased by 66.7 per cent during the same period. Loans to the manufacturing sector have shown an upward trend not only in terms of value but also as percentage share of aggregate bank lending. The proportion of non- performing loans to total loans averaged about 2.9 per cent for the private banks as at end-March 2001, a decline from that of 5.25 per cent in the previous year. The Central Bank is encouraging the private banks to reduce these NPLs and also strengthening its supervisory and regulatory functions.
Price Trend
CPI inflation, representing the whole country, has declined in 2000-2001 to 1.3 per cent on annual basis. Much of the declines in inflation during the past few years is due to stable food prices supported by a better harvest in the year 2000-2001. However, there is cause for concern as inflation creeps back to double digit in recent months.
Balance of Payments
The external current account deficit registered a strong improvement to reach Kyat 299.5 million in 2000-2001 from that of Kyat 2,919.6 million in 1999-2000, mainly due to substantial increase in natural gas exports. Total value of exports, including border trade, reached Kyat 11,306.0 million in 2000-2001 while the value of imports totaled Kyat 13,409.7 million during the same period. Total exports in terms of value increased significantly by 33.8 per cent in 2000- 2001. Imports growth declined by 9.2 per cent as a result of tightening of import and exchange controls. Despite improvements in the current account, Myanmar posted an overall deficit of Kyat 396.0 million, mainly due to the fall of foreign direct investment and other capital outflows. Reflecting these developments, gross international reserves dropped from Kyat 2,170.5 million at end-March 2000 to Kyat 1,765.7 million in March 2001, which is equivalent to almost 1.6 months of import cover.
42 Trade with ACU Countries
Myanmar continued to register a favorable trade balance with other ACU countries in 2000-2001. The trade surplus increased to US Dollars 249.6 million in 2000-2001 from that of US Dollars 185.6 million in 1999-2000, mainly reflecting a sharp growth in exports to India, Pakistan and Bangladesh. Exports to ACU countries increased by 26.7 per cent in 2000-2001 while imports from ACU countries grew by 8.9 per cent during the same period. Bangladesh and India are the leading ACU buyers for Myanmar's exports.
43 SELECTED ECONOMIC DATA OF MYANMAR (In Million Kyats)
2000/2001 (Provisional) Gross domestic product 93,623 (At 1985/86 constant prices) Agriculture 33,659 Livestock & fishery and forestry 9,178 Manufacturing and processing 10,238 Mining 2,379 Services 18,585 Others 19,584 Growth rate of GDP (per cent) 6.2
Price Consumer price index 1/ 156.4 (1997=100) Inflation rate (per cent) 1.3
Balance of payments Current account Goods Exports 11,306.0 Imports -13,409.7 Trade balance -2,103.7 Services(net) 31.1 Transfers(net) 1,773.1 Current account (net) -299.5 Capital account (net) 423.4 Errors and omissions -519.9 Overall balances -396.0 Monetary movements 396.0
1/ Provisional actual data
44
MYANMAR : GOODS AND SERVICES ACCOUNT (In Million Kyats)
1/ 2/ 1999/2000 2000/2001 (P.A)
Trade Balance -6,319.4 - 2,103.7 Exports 8,449.0 11,306.0 Imports -14,768.4 -13,409.7
Services Balance 1,210.1 31.1 Receipts 3,577.0 3,443.0 Payments -2,366.9 - 3,411.9
Source: Central Bank of Myanmar 1/ Provisional actual data
2/ Provisional data
MYANMAR TRADE WITH ACU COUNTRIES IN 2000/2001 (In Million US Dollars)
1/ 2/ Exports Imports (P.A) (P.A)
BANGLADESH 52.9 1.2 BHUTAN - - INDIA 259.7 82.1 IRAN 0.3 2.1 NEPAL *2/ 0.1 PAKISTAN 22.4 1.7 SRI LANKA 1.6 0.1
TOTAL 336.9 87.3
Memorandum Item:
Share of trade with ACU Countries as percentage 19.4 4.2 of total trade
Source: Central Statistical Organization 1/ Provisional data
2/ less than US Dollars 0.1 million
45 NEPAL
During the FY 2000-2001, the gross domestic product (GDP) at 1994-1995 factor cost is estimated to have grown by 4.9 per cent. This was mainly attributed to the normal weather conditions for agricultural sector and high growth in electricity, gas and water and community and social services sub-sectors of non-agricultural sector. Last year, it had recorded the growth of 6.4 per cent. The growth of real GDP at producer price was similar to the growth at factor cost. The growth of nominal GDP at producer price and at factor cost was lower (8.0 per cent and 7.3 per cent) compared to last year due mainly to the decline in agricultural products. During the review year, consumption ratio to GDP increased marginally by 0.44 percentage point to 85.8 per cent while the ratio of both investment and gross domestic saving to GDP decreased by 0.37 percentage point and 0.44 percentage point to 23 per cent and 14.2 per cent respectively. The real per capita GDP during the review year increased by 2.5 per cent to Rs. 12,633.00 whereas nominal per capita GDP increased by 5.5 per cent to Rs. 17,667.00 during the review year. Sectorally, both agriculture as well as non-agriculture sector showed a respective growth of 4.2 per cent and 5.3 per cent during the review year while these sectors registered higher growth of 5.0 per cent and 7.2 per cent last year. With regard to agricultural sector, the combined production index of foodgrains and cash crops recorded a growth of 3.9 per cent in the review year compared to a growth of 7.7 per cent last year. Similarly, livestock products comprising of milk, meat and eggs recorded a growth of 2.5 per cent to 5.5 per cent this year. In addition, the other crops and fishery sub-sector registered relatively a higher growth of 9.7 per cent and 8.8 per cent respectively. In the industrial front, overall scenario was not discouraging this year. Industrial production index of the major 33 products (base year 1986-1997=100) increased by 5.7 per cent in the review year while the production of exportable goods like garments and carpet has declined. The number of industries registered have been declined in review year while the number of industries licensed showed the rising trend. Similarly, 97 joint venture industries were approved during the review year with the total project cost amounting to Rs. 8.0 billion. The fixed capital of these joint venture industries amounted to Rs. 6.2 billion of which total foreign investment was 3.0 billion ( 48.4 per cent). The total credit disbursement by Nepal Industrial Development Corporation (NIDC) during the review year recorded a significant decline of 24.2 per cent due mainly to the lack of financial resources. The performance of tourism sector based on some important tourism indicators have shown a mixed outcome during the calendar year 2000. In the review year, tourist arrivals by air and per capita expenditure of third country tourist has declined. However, in contrast the number of hotel and hotel beds, trekking permits, generation of employment from trekking and royalty to government from trekking has increased promisingly. Average duration of stay of a tourist has remained at 12 days as of the last year level. The broad goals set for monetary policy for the fiscal year 2000-2001 were to (i) facilitate the economic growth rate at about 6.5 per cent by providing an adequate level of liquidity, (ii) maintain inflation rate about 5 per cent and (iii) attain a reasonable level of surplus in BOP. Besides these goals, monetary policy stance was also aimed at softening nominal interest rates. During the fiscal year 2000-2001, both the monetary aggregates narrow money (M1) and broad money (M2) registered a decelerating growth compared to their respective growth in the previous year 1999-2000. Of the monetary aggregates, M2 registered a growth of 15.3 per cent (Rs. 28.5 billion) during the review year compared to
46 a 21.8 per cent (Rs. 33.3 billion) growth in the preceding year. Narrow money (M1) also posted a decelerating growth of 16.1 per cent (Rs. 9.8 billion) during the review year compared to an increase of 19.4 per cent (Rs. 9.9 billion) in the preceding year. NFA, an expansionary factor of money supply, increased by a lower rate of 6.5 per cent (Rs. 5.2 billion) after adjusting the exchange valuation gain of Rs. 2.1 billion during the review year. Such NFA had gone up by 22.2 per cent (Rs. 14.4 billion) in the previous year. A weak performance of exports and decline in inflows of services net were the reasons for the deceleration in NFA during the review year. Similarly, domestic credit, the other expansionary factor of money supply grew by a relatively higher rate of 18.6 per cent (Rs. 29.3 billion) during the review year compared to a growth of 17.2 per cent (Rs. 23.2 billion) in the preceding year. Relatively higher growth of net claims on government caused accelerate domestic credit during the review year. However, time deposits followed the decelerating trend of 15.0 per cent (Rs. 18.7 million) growth during the review period compared to 23.0 per cent (Rs. 23.4 billion) in the preceding year. Net non-monetary liabilities, the contractionary factor of money supply, registered relatively a higher growth of 11.5 per cent (Rs. 6.0 billion) during the review year compared to an increase of 9.1 per cent (Rs. 4.3 billion) in the preceding year due mainly to the increase in capital and reserves of commercial banks. Reserve money, posted a growth of 16.0 per cent (Rs. 9.8 billion) during the review year compared to a slightly higher growth of 16.8 per cent in the preceding year. During the review year, the value of narrow money multiplier remained unitary as in the previous year, while the value of broad money multiplier declined to 3.03 at mid-July 2001 from 3.05 a year ago. Decelerated growth of private sector credit and NFA contributed to a relatively lower rise of M2, which in turn caused a slight fall in broad money multiplier during the review year. Likewise, the income velocity of both monetary aggregates showed a declining trend during the review period. Income velocity of broad money declined to 2.04 during the review year from 2.24 a year ago. Income velocity of narrow money also vent down from 6.78 in the preceding year to 6.21 during the review year. Declining trend of opportunity cost of money holding including the declining trend of share market activities and continued expansion of monetization of economic activities were the major factors responsible for such a decline in income velocity. Total assets/liabilities of commercial banks increased by a relatively lower rate of 18.7 per cent (Rs. 38.7 billion) during the review year and stood at Rs. 245.5 billion at mid-July 2001. Such assets/liabilities had gone up by 20.7 per cent (Rs. 35.5 billion) in the preceding year. On the liabilities side, total deposits of commercial banks increased by a relatively lower rate of 17.3 per cent (Rs. 26.7 billion) during the review year compared to 21.9 per cent (Rs. 27.8 billion) growth in the preceding year. On the assets side, total loans and advances of commercial banks expanded by a lower rate of 18.2 per cent (Rs. 24.7 billion) during the review year compared to 21.6 per cent (Rs. 24.2 billion) growth in the preceding year due mainly to the deceleration in credit flow to the private sector. The priority sector lending of the commercial banks constituted 14.4 per cent of their total outstanding loans. The monetary and financial measures taken by Nepal Rastra Bank during the review year included the implementation of second generation financial sector reforms, new directives to commercial banks and development banks, directives on interest rates, permission to establish two commercial banks, and three development banks. Activities of Other Banking Institutions (OBIs) include activities of deposit taking financial institutions other than commercial banks viz., Development Banks, Rural Development Banks, Finance Companies, Financial Cooperatives (FINCOOPs) and Financial Non-government Organizations (FNGOs). Similarly, Non-Bank Financial
47 Institutions include all other financial institutions not directly involved in accepting public deposits but occupy important place in the financial system in mobilizing financial resources collected in different forms such as premiums through insurance business, collection of employees' provident fund and voluntary savings of corporate employees. Above 17 insurance companies including Deposit Insurance and Credit Guarantee Corporation, one Employees Provident Fund and one Citizen Investment Trust belong to this type of financial institutions. Apart from this, securities market too mobilizes financial resource in capital market through selling and buying securities such as corporate shares, debentures and bonds. The aggregate sources of fund of OBIs recorded a growth of 15.8 per cent (Rs. 5.52 billion) to Rs. 40.43 billion during FY 2000-2001 compared to an increase of 4.3 per cent (Rs. 1.44 billion) in the previous fiscal year. The outstanding loans of these institutions also increased by 15.7 per cent (Rs. 4.04 billion) to Rs. 29.84 billion in the review year compared to an increase of 17.8 per cent (Rs. 3.90 billion) in the preceding year. Financial resources as well as lending activities of these institutions improved during the review year compared to the previous fiscal year. NBFIs such as Insurance Companies, Employees Provident Fund, Citizen Investment Trust have shown satisfactory performance during the review year. In the first quarter of FY 2000-2001 stock market showed much brighter expectation, but through second quarter round the year the market continuously turned downward. In the fiscal front, the government budget for the FY 2000-2001 was prepared in the backdrop of strong commitment of the government in improving the economy. FY 1999-2000 marked the situation of impressive growth of GDP, satisfactory revenue collection, rising regular and development expenditure and high fiscal imbalances. The revised estimate of the government budgetary operation in the FY 2000-2001 reflected a fiscal deficit of Rs. 18.3 billion, which was 46.9 per cent higher than that of the previous year. During the review year, total expenditure and investment increased by 27.5 per cent while total resources grew by 22.3 per cent. As a per cent of GDP, total expenditure and total resources stood at 18.4 per cent and 13.9 per cent respectively resulting into the fiscal deficit of 4.5 per cent. In the review year, tax revenue increased by 17.0 per cent reflecting an achievement of 91.3 per cent of its target and non-tax revenue by 10.0 per cent showing 104.6 per cent realization of its budget target. On the expenditure side, regular expenditure increased by 29.0 per cent due to the increasing debt serving of external loan and increasing obligation on security whereas development expenditure during the review year grew by 25.2 per cent. Regarding the public debt, the stock of the total outstanding debt amounting to Rs. 256.4 billion at mid-March 2001, registered an increasing of 4.6 per cent. The outstanding debt to GDP ratio was 62.8 per cent in the review year compared to 64.8 per cent last year. The National Urban Consumer Price Index (1995-1996=100), on an average basis, registered a rise of 2.4 per cent in the FY 2000-2001 as compared to an increase of 3.5 per cent in the last FY 1999-2000. On point to point basis (June/July 2000 and June/July 2001), the rate of inflation rose by 3.4 per cent as against the rise of 0.6 per cent in the previous year. The index of Food and Beverages group dropped by 2.3 per cent as compared to a rise of 0.4 per cent in FY 1999-2000. The index of non-food and services group, on the other hand, rose by 8.1 per cent as compared to a rise of 7.1 per cent last year. Regionwise, the annual average inflation for Hill, Terai and Kathmandu remained at 5.2 per cent, 1.1 per cent and 3.2 per cent respectively in FY 2000-2001. The overall price indices of Hill, Terai and Kathmandu had remained at 3.7 per cent, 3.1 per cent and 3.7 per cent respectively in the previous year. In the external sector, the policies adopted during the FY 1999-2000 mainly concentrated on facilitation of
48 foreign exchange, during the review year, total exports increased by much higher growth rate than imports. However, there was a slight expansion in trade deficit owing mainly to large magnitude of imports. Increase in trade deficit together with large decline in net services receipt resulted in deterioration of current account balance despite a significant increase in net transfer receipts. Similarly, due to a lower surplus in capital account, the overall balance of payments remained in a surplus but lower than in the previous year. In the export front, total exports increased by 11.7 per cent and reached to Rs. 55.7 billion during the review year compared to an increase of 39.7 per cent during the previous year. Regionwise, exports to India increased by 22.7 per cent as against a heavy growth of 69.3 per cent a year ago. On the other hand, export to other countries which had increased by 23.6 per cent during the preceding year, registered a lower growth of 3.6 per cent during the review year. Total imports increased by 6.6 per cent to Rs. 115.7 billion during the review year as against a large increase of 24.0 per cent in the previous year. Such a lower growth in imports is attributed mainly to the decrease in imports growth from other countries than India. Trade deficit expanded by 2.3 per cent and stood at Rs. 60.0 billion during the review year as against an expansion of 13.2 per cent during the preceding year. Current account balance remained deficit by Rs. 11.0 billion during the review year compared to a deficit of Rs. 9.0 billion in the previous year. On the capital account, net foreign capital of Rs. 16.2 billion was received during the review year. In this account, official capital net registered a decline of 17.8 per cent and stood at Rs. 7.0 billion. Similarly, miscellaneous capital item net reflected an inflow of Rs. 9.2 billion during the review year compared to an inflow of Rs. 14.9 billion in the previous year. Consequently, net position of external payments resulted in a surplus of Rs. 5.2 billion compared to a surplus of Rs. 14.5 billion in the preceding year. The net position of convertible foreign currency resulted into a surplus of Rs. 7.3 billion during the review year compared to a surplus of Rs. 11.2 billion in the preceding year. Total income rose by 39.8 per cent while total expenditure increased by 55.6 per cent during the review year. Corresponding growth in the previous year were 11.0 per cent and 17.5 per cent respectively. Net foreign assets of the banking system recorded an increase of 9.1 per cent and reached to Rs. 87.8 billion at the end of the review year compared to an increase of 23.7 per cent in the preceding year. The net foreign assets of Nepal Rastra Bank increased by 14.8 per cent while that of commercial banks went down by 15.5 per cent during the review year. In the preceding year net foreign assets of Nepal Rastra Bank and commercial bank had increased by 24.1 per cent and 22.2 per cent respectively.
49 MAIN ITEMS OF GOODS AND SERVICES TRADED WITH ACU COUNTRIES IN 2001 (In Nepalese Rupees)
BANGLADESH
EXPORTS 1.Lentils (pulses) 481,241,548 2.Oranges 3,020 3.Apples, fresh 37,368 4.Gringer, raw 15,600 5.Spices 23,344 6.Wheat and meslin 16,380,834 7.Maize corn 1,745,226 8.Seeds of forage plants 955,520 9.Radish seeds 3,685,602 10.Sugar confectionery not containing cocoa 61,178 11.Prepared foods obtained by swelling or roasting of cereal or cereal products 2,512,560 12.Prepared foods 5,313,309 13.Biscuits, waffles and wafers 85,711 14.Bakers' wares 23,100 15.New pneumatic rubber tyre for buses or lorries 8,176,127 16.Vaneer sheets and sheets for plywood 7,000 17.Wood marquetry and inlaid wood, casket and cases for jewellery or cutlery of wood 9,298 18.Handmade paper and paperboard, use for writing printing or graphic purposes in rolls or sheets 2,489 19.Writing and printing light-weight coated paper of which more than 10 per cent by weight of total fiber content consist of fiber obtained by mechanical process 2,465 20.Paper and paperboard of a kind used for writing printing of which more than 10 per cent by weight of total fiber content consist of fiber obtained by mechanical process 4,845 21.Kraft paper and paperboard, other than that of a kind used for writing printing or other graphic purposes 7,096 22.Newspaper, appearing at least four times a week 12,932 23.Carpet, knotted of wool or fine animal hair 21,629 24.M & B woolen overcoat, carcoat, capes, cloaks, anoraks, windcheaters, wind-jackets and similar articles knitted or crocheted 1,510 25.Woolen jersey, pullover, cardigans, sweater , waistcoat, knitted 625 26.W & G trousers, bib and brace overalls, breeches and shorts of synthetic fibers 104,776 27.W & G trousers, bib and brace overalls, breeches and shorts 2,800 28.W & G blouses, shirt and shirt-blouses of manmade fibers 6,519 29.Woolen shawls, scarves, mufflers, mantillas veils and the like 2,210 30.Cotton bed linen, printed 32,480 31.Bed linen, knitted or crocheted 23,100 32.Hats and headgears, knitted or crocheted 19,591 33.Woven cloth of iron or steel wire 142,787
50 34.Parts and accessories of projector 9,213 35.Wooden furniture of akind used in office 8,748 36.Brooms and brushes 600 37.Hair pins, curling pins, curling grips, hair curlers 10,400 38.Original sculptures and statuary in any material 9,727 ------Total: 520,702,887 ------
IMPORTS
1.Mixture of juices 116,405 2.Food preparations 515 3.Vaccines for human medicine 160,529 4.Vaccines for veterinary medicine 530,868 5.Homeopathic medicaments not put up in measured doses or in forms or packings for retail sale 1,038,395 6.Homeopathic medicaments, put up in measured doses or in forms or packings for retail sale 7,335,614 7.Fertilizer, mixture of urea and ammonium nitrate in aqueous or ammonical solution 7,715,920 8.Mixtures of odoriferous substance and mixtures 256,476 9.Plate, sheet, film foil and strip of plastic 1,559,054 10.Sacks and bags of plastic 14,930 11.Household and toilet articles of plastic 617,671 12.Plastic apparel and gloves 507,855 13.Articles of plastic 6,544,597 14.Toilet of facial tissue stock 200,960 15.Transfers (decalcomanias) 12,900 16.Trade advertising material, commercial catalogues 12,352 17.Woven fabric of cotton, unbleached, containing 85 per cent or more by weight of cotton, weighing not more than 200g/m2 1,509,008 18.Jute and other textile bast fibers raw or retted 107,900,485 19.Synthetic staple fiber of acrylic or modacrylic not carded combed or otherwise processed for spinning 54,643 20.Synthetic staple fiber, not carded, combed 2,961,644 21.Woven label, badge of textile materials 16,343,833 22.Labels, badges and similar articles 7,435 23.Rubberised textile fabric 665,212 24.M & B underpant and briefs of other textile materials, knitted 142,725 25.M & B cotton jacket and blazers, not knitted 70,261 26.W & G cotton ensembles, not knitted 17,101 27.M & B cotton shirt, not knitted 193,284 28.M & B shirt of textile material, not knitted 1,091,936 29.W & G blouses, shirt and shirt-blouses of textile material, not knitted 343,544 30.M & B cotton underpants and briefs, not knitted 229,715 31.Babies garments of wool or fine animal 44,640 32.Gents cotton Dhoti, Lungi and Gamchha, not knitted 3,372,510 33.Hat-forms, hat bodies and hoods of felt 1,013,550 34.Hats and headgears, knitted or crocheted 4,472,460 35.Headgear, whether or not lined or trimmed 1,077,837 36.Household and toilet articles of porcelain or china 278,392 37.Gold, unwrought 9,780
51 38.Zinc alloys 1,685,913 39.Tea shorting machine, tea formenting machine, tea drier machine, L. T. P. machine 37,947 40.Analogue or hybrid automatic data processing machine 22,936 41.Parts and accessories of automatic data processing machines 121,000 42.Inductors 1,196,109 43.Electric accumulators of lead acid, used for starting piston engines 6,891,117 44.Lead acid accumulators 6,989,594 45.Accumulators 14,035,161 46.Sound reproducing apparatus 200,000 47.Colour Television 30,000 48.Electrodes 607,200 49.Articles of graphite or carbon 2,579,600 50.Parts and accessories of motor vehicles 6,900 51.Slide fasteners 499,279
------Total: 203,327,792 ------
52 BHUTAN
EXPORTS 1.Uncooked pasta, not stuffed or otherwise prepared 14,535,120 2.Prepared foods obtained by swelling or roasting of cereal or cereal products 347,293 3.Juice of single citrus fruit 112,008 4.Juice of single fruit or vegetable 544,000 5.Incense sticks 10,815 6.Soaps 3,942,880 7.Insecticides 62,400 8.Handbags 636,291 9.Carpet, knotted of wool or fine animal hair 18,817 10.Woolen jersey pullover, cardigans, sweater, waistcoat, knitted 14,486 11.W & G cotton overcoat, carcoat, raincoat, capes cloaks and similar articles, not knitted 22,155 12.M & B cotton jacket and blazers, not knitted 7,949 13.W & G cotton jacket, not knitted 12,760 14.W & G blouses, shirts and shirt-blouse of silk or silk waste 16,297 15.W & G woolen blouses, shirts and shirt-blouses 7,655 16.M & B cotton nightshirt and pyjama, not knitted 2,141 17.M & B garment of textile fabric and rubberised textile fabric 6,244 18.Woolen shawls, scarves, mufflers, mantillas, veils and the like 4,000 19.Cotton sacks and bags 17,986 20.Refined copper wire 1,765,500 21.Steam turbine of an output exceeding 40MW 1,521,808 22.Check valves 850,011 23.Electric smoothing irons 24,385 24.wooden furniture of akind used in office 38,767 25.Sleeping bags 10,497 26.Original sculptures and statuary in any material 153,621 ------Total: 24,685,886 ------
IMPORTS 1.Gypsum 799,137 2.Coke and semicoke of coal 51,363,820 3.Newspapers, journals and periodicals 500 4.Trade advertising material, commercial catalogues 600 ------Total: 52,164,057 ------
53 IRAN
EXPORTS IMPORTS Nil 1.Saffron 9,188,586 2.Crispbread 41,403 3.Paraffin wax 13,821,535 4.Bituminous or oil shale and tar sands 4,886,185 5.Trade advertising material, commercial catalogues 900 6.Yarn of vegetable textile fibers 195,190 7.Non woven products of glass fiber 170,220 8.Electro-medical instruments and appliances 56,339 ------Total: 28,360,358 ------
MYANMAR
EXPORTS 1.Carpet, knotted of wool or fine animal hair 124,104 2.M & B cotton shirt, not knitted 7,435 ------Total: 131,539 ------
IMPORTS 1.Pulses (Blackgram) 1,289,494 2.Natural rubber latex, whether or not prevulcanised 950,770
------Total: 2,240,264 ------
54 PAKISTAN
EXPORTS
1.Large cardamom 7,560,225 2.Rye 590,564 3.Plants and parts of plants (including seeds and fruits) of a kind used primarily in perfumery, in pharmacy or for insecticidal or similar purposes 679,323 4.Lycopodium powder 208,832 5.Food preparations 738,212 6.Cornea 3,080,017 7.Perfumes and toilet waters 7,143 8.Cream and like preparations 569,580 9.Goat or kid skin leather, perchament-dressed or after tanning 397,874 10.Leather of animals, without hair on 4,050,150 11.Bags and similar articles 5,352 12.Doors and their frames 34,045 13.Statuettes and other ornaments, of wood 59,758 14.Wood marquetry and inlaid wood, casket and cases for jewellery or cutlery, of wood 10,707 15.Writing and printing light-weight coated paper of which more than 10 per cent by weight of total fiber content consist of fiber obtained by mechanical process 374 16.Paper and paperboard of a kind used for writing, printing of which more than 10 per cent by weight of the total fiber content consists of fibers obtained by a mechanical process 369 17.Kraft paper and paperboard, other than that of a kind used for writing, printing or other graphic purposes 1,472 18.Toilet paper 5,832 19.Woolen shawls, scarves, mufflers, mantillas, veils and the like 2,576,682 20.Headgear, whether or not lined or trimmed 63,084 21.Articles of silver jewellery, whether or not plated or clad with other precious metal 43,390 22.Wooden furniture of kind used in office 8,243 23.Electric lamps and lighting fittings 7,465 24.Collages and similar decorative plaques 23,068 25.Original sculptures and statuary in any material 223,950 ------Total: 20,945,711 ------
IMPORTS
1.Live poultry 5,000 2.Whey and modified whey 387,799 3.Pulses Moong 678,780 4.Dates 18,692,907 5.figs 280,261 6.Dried apricots 528,234 7.Spices 1,430,907 8.Lac 788,350 9.Natural gum, resin 602,492
55 10.Pectic substance, pectinates, and pectates 60,224 11.Mucilages and thickeners whether or not modified, derived from vegetable products 598,408 12.Benzene 1,033,432 13.Powder and like preparations 221,694 14.Preparation for use on the hair 226,769 15.Incense sticks 475,505 16.Enzymes 76,400 17.Photographic films inrolls, sensitised unexposed for colour photography 99,982 18.Photographic plates, film, paper exposed but not developed 22,052 19.Hydraulic brake fluids and other prepared liquids for hydraulic transmission 110,801 20.Articles of plastic 38,000 21.Goat or kid skin leather, without hair on tanned or retanned but not further prepared, whether or not split 1,126,500 22.Unbleached kraftliner in rolls or sheet 390,189 23.Printed paper and paperboard labels 15,624 24.Trade advertising material, commercial catalogues 3,000 25.Woven fabric of cotton, unbleached, containing 85 per cent or more by weight of cotton, weighing not more than 200g/m2 14,169,710 26.Woven denim fabric of cotton, containing 85 per cent or more by weight of cotton weighing more than 200g/m2 1,175,264 27.Woven fabric of cotton, dyed, weighing not more than 200g/m2 6,795,935 28.Cotton fabric, wrap knit 741,681 29.Garments, knitted and crocheted of manmade fibers 7,948 30.M & B cotton trousers , bibs and brace overalls, not knitted 11,000 31.M & B cotton shirt, not knitted 36,830 32.W & G cotton Dhoti and Lungi, not knitted 8,000 33.W & G sari and lungi of manmade fiber, not knitted 19,000 34.Shawls scarves, mufflers mantillas, veils and the like of silk or silk waste 22,320 35.Woolen shawls, scarves, mufflers, mantillas, veils and the like 70,868 36.Blankets and travelling rugs 26,500 37.Worn clothing and worn articles 68,942 38.Footwear with uppers of leather or composition leather 1,000 39.Hats and headgear, plaited or made by assembling strips any material whether or not lined or trimmed 11,282 40.Hats and headgears, knitted or crocheted 35,721 41.Ceramic articles 222,164 42.Glass beads, bangles 663,989 43.Gold unwrought 371,708 44.Imitation jewellery 41,305 45.Coin, not being legal tender 37,425 46.Machinery for filtering or purifying water 844,800 47.Machinery parts for industrial preparation 36,725 48.Weaving machine for weaving fabrics of a width not exceeding 30 cm 328,050 49.Weaving machine 545,287 50.Machine for tufting 1,053,667 51.Analogue or hybrid automatic data processing machine 21,817
56 52.Parts and accessories of automatic data processing machines 73,509 53.Electric accumulatores of lead acid, used for starting piston engines 4,185,844 54.Turntables (record-decks) 5,312,800 55.Record players cassette type 261,000 56.Sound reproducing apparatus 192,416 57.C.D.cassette 3,726,000 58.Video recording or reproducing apparatus(deck) 1,124,000 59.Computer tape of a width not exceeding 4mm 1,537,674 60.Magnetic tape of width not exceeding 4mm 1,484,000 61.Magnetic disc 4,433,000 62.Prepared unrecorded media for sound recording phenomena of computer 8,801,000 63.Prepared unrecorded media for sound recording or similar recording of other phenomena 8,060,000 64.Audio cassette tape 226,400 65.Computer floppy disk 3,437,000 66.Video cassette 280,499 67.Colour Television 11,000 68.Parts and accessories of motor bodies 121,661 69.Parts and accessories of motor vehicle 1,549,495 70.Ultrasonic scanning apparatus 307,107 71.Electro-diagnostic apparatus 35,137 72.Catheters, cannulae 481,486 73.Instrument appliances used in dental science 91,376 74.Electro-medical instruments and appliances 1,520,074 75.Dental fittings 1,280,849 76.Apparatus based on x-rays 50,289 77.Furniture of cane, osier, bamboo 31,410 78.Pillow 484,225 79.Lawn tennis balls 15,000 80.Articles and equipment for swimming pools, padding pools 89,220 ------Total: 104,465,719 ------
SRI LANKA
EXPORTS 1.Handmade paper and paperboard, use for writing printing or graphic purposes in rolls or sheets 604 2.Writing and printing light-weight coated paper of which more than 10 per cent by weight of total fiber content consist of fiber obtained by mechanical process 598
57 3.Paper and paperboard of a kind used for writing, printing of which more than 10 per cent by weight of the total fiber content consists of fibers obtained by a mechanical process 1,175 4.Kraft paper and paperboard, other than that of a kind used for writing, printing or other graphic purposes 1,770 5.Printed books 1,000 6.Newspaper, appearing at least four times a week 2,396 ------Total: 7,543 ------
IMPORTS 1.Green tea not fermented in immediate packing of a content not exceeding 3kg 1,520 2.Black tea fermented 1,317,000 3.Flour, meal and powder of edible fruit and nut 332,135 4.Crude soyabean oil 7,770,105 5.Crude palm oil 229,250,311 6.Crude coconut oil 5,109,445 7.Plastic apparel and gloves 135,614 8.Articles of plastic 2,075,538 9.Natural rubber latex, whether or not prevulcanised 901,512 10.New Pneumatic rubber tyre for motorcar 4,581,972 11.New Pneumatic rubber tyre for buses or lorries 16,033,464 12.New Pneumatic rubber tyre 92,598 13.Inner rubber tube for motorcar, buses, lorries 42,770 14.Inner rubber tube for agricultural tractors 109,712 15.Inner rubber tube 101,644 16.Printed paper and paperboard labels 91,130 17.Newspapers, journals and periodicals 7,000 18.Trade advertising material, commercial catalogues 300 19.Woven fabric of cotton, unbleached, containing 85 per cent or more by weight of cotton, weighing not more than 200g/m2 202,536 20.Woven label, badge of textile materials 383,268 21.Labels, badges and similar articles 127,211 22.M & B cotton shirt, not knitted 2,000 23.Hats and headgear, plaited or made by assembling strips any material whether or not lined or trimmed 5,688 24.Headgear, whether or not lined or trimmed 6,681 25.Tiles cubes and similar articles 457,068 26.Copper scrap 19,640,839 27.Crown corks of base metal 2,952,696 28.Household or laundrytype fully automatic washing machine, each of a dry linen capacity not exceeding 10kg. 64,757 29.Analogue or hybrid automatic data processing machine 1,304,972 30.Parts and accessories of automatic data processing machines 758,915 31.Colour Television 93,469 ------Total: 293,953,870 ------
58 PAKISTAN
Pakistan's economic performance in FY2001 can be characterized by government efforts to bring macroeconomic fundamentals back on-track. The fiscal deficit was contained within its targeted level, inflation was low, current account was in surplus, foreign exchange reserve accumulation was satisfactory and government borrowing from the banking system was within manageable limits. For the first time, Pakistan completed its Standby Arrangements (SBA) with the IMF and established credibility with the international financial institutions.
Economic Growth, Savings and Investment
Overall economic activities slackened considerably in FY2001. Growth in real gross domestic product (GDP) decelerated from 3.9 per cent in FY2000 to 2.6 per cent in FY2001 against the target of 5.0 per cent. This slowdown, originating in the agriculture sector, was imminent due to the drought like situation caused by the acute shortage of water throughout the country. Lower than targeted production of cotton, rice, sugarcane and wheat, pushed the growth of agriculture down to negative 2.5 per cent. Counterbalancing the impact of agriculture, industrial sector, with its impressive recovery of 4.2 per cent during FY2001 (against a decline of 0.1 per cent last year), provided impetus to other allied sectors of the economy. National savings as a per cent of GNP stood at 12.9 per cent in FY2001 compared to 13.9 per cent last year. Gross total investment declined from 15.8 per cent of GNP in FY2000 to 14.9 per cent this year. Deterioration was also observed in the ratio of national savings to total investment, which fell to 86.5 per cent in FY2001 compared to 88.1 per cent last year.
Price Trends
After recording a three-decade low last year, price inflation slightly moved up in FY2001 reflected by the increases in all the three indices. The average rate of inflation in terms of Consumer Price Index (CPI) rose to 4.41 per cent during FY2001 from 3.58 per cent in the previous year. Wholesale Price Index (WPI) and Sensitive Price Index (SPI) both went up by 6.21 per cent and 4.84 per cent respectively compared with much lower increase of 1.80 per cent in both indices a year earlier. During July-December 2001, price inflation remained subdued. CPI, WPI and SPI recorded a rise of 2.33 per cent and 3.03 per cent and 2.10 per cent respectively compared with their respective increases of 4.91 per cent, 6.28 per cent and 5.20 per cent during July-December 2000.
Public Finance & Fiscal Policy
For the second consecutive year, tax revenues posted double digit growth which signalled an increase in real terms. The focus remained on sales tax, and despite the replacement of certain excise duties by sales tax, the combined growth of these two revenue heads was still 17.1 per cent in FY2001. Furthermore, direct taxes also showed strong growth (12.8 per cent ) compared to the mild increase of 2.5 per cent last year. Given the difficulty to fiscal reforms, not just in terms of shifting tax incidence but also to change the mind-set of collectors and payers, these increases indicated
59 a credible change in Pakistan's fiscal stance. The reform of tax administration and the Central Board of Revenue (CBR), has become imperative if significant improvement in fiscal revenue is to be attained with a widening of the tax net. In overall terms, the austerity of the stabilization program was able to contain the consolidated fiscal to Rs. 185.6 billion, which was Rs. 18.5 billion less than last year. Although revenue collection was impressive, this narrowing of the fiscal gap also required hard steps to contain expenditures. Total expenditures edged up by Rs. 6.8 billion, but the reprioritization allowed development spending to increase by Rs. 14.4 billion during FY2001. Although this has increased its ratio to GDP from 2.8 to 2.9 per cent, this at least showed a break from the past trend dating back 10 years. In this regard, FY2001 should prove to be a turning point in terms of social/development spending.
Developments in Capital Market
The year 2000-2001 witnessed major developments in the capital market as a result of a series of reform measures taken to promote investor confidence and strengthen the integrity of the market. In order to improve the working and depth of capital market in Pakistan, strong capabilities were developed to gear up Securities and Exchange Commission of Pakistan (SECP) to play an active role in the development of capital market. SECP took a number of policy decisions to revamp the overall structure of the bourses and create an investment friendly environment to broaden the investor profile in the equity market. These included the introduction of various laws for the protection of small investors, measures to impose transparency in trade, curbing the practice of insider trading and brining operations to international standards. National Clearing and Settlement System was made operational. T+3 system where all transactions are settled on the third day has been launched. Additionally, a new code of conduct has been specified for stockbrokers.
Performance of Capital Market (2000-2001)
Pakistan's capital market showed a mixed trend during FY2001. The benchmark Karachi Stock Exchange KSE-100 index shed 10.1 per cent since the beginning of year and closed at 1,366.4 by end year. The capitalized value of ordinary shares (Rs. 339.2 billion) fell by 13.4 per cent during FY2001 as against an increase of 36.9 per cent a year earlier. The turnover of shares declined from 48.1 billion in FY2000 to 29.2 billion in FY2001. The total number of listed companies also declined from 762 in FY2000 to 759 in FY2001. This downturn could be attributed to a host of factors including the lack of concrete progress on privatization, uncertain investor confidence, the continuous depreciation of the rupee and friction between SECP and the bourses. While equity market remained bearish, the corporate bond market showed encouraging movements. The growth in this market was encouraging, as ten new Term Finance Certificate (TFC) issues were floated during FY2001 alone, compared to ten in the last five fiscal year.
Balance of Payments (2000-2001)
Pakistan's external sector witnessed a range of positive developments during 2000-2001. These included: (i)
60 Exports exceeding US Dollars 9 billion mark for the first time in the country's history (ii) Worker's remittances crossing US Dollars 1 billion mark again after a lapse of one year (iii) Resumption of financial assistance from IFIs paving the way for investment inflows (iv) US Dollars 1.75 billion debt rescheduled by the Paris Club and (v) Amicable resolution of long-standing tariff dispute with HUBCO, expected to spur investment and contribute to economic growth. External sector also remained under pressure for a host of reasons during 2000-2001. Rising oil prices kept inflating the country's import bill. Sagging prices of exportables in the international market resulted in deterioration of terms of trade. The US economy that had accounted for about 25 per cent of country's total exports in 1999-2000 slowed down during 2000-2001 and adversely impacted country's export growth. Portfolio investment plummeted drastically. However, despite these adverse developments, the balance of payments position on average improved significantly reflecting notable contraction in both current account deficit excluding official transfers (55.5 per cent) and outflows under capital account (85.5 per cent). The rupee remained under pressure against the US Dollar both in the inter-bank market and the kerb market during FY2000-2001. Inter-bank rupee/dollar parity ended up with depreciation of 18.6 per cent to Rs. 63.90 per dollar between July 2000 and June 2001. Rupee depreciation in the kerb market between the same period stood at 22.47 per cent. Export earnings did cross the level of US Dollars 9 billion (customs-based) in 2000-2001 for the first time in the country's history and registered moderate growth of 7.4 per cent, yet they fell short of the export earnings target of US Dollars 10 billion set for 2000-2001. Export earnings picked up largely due to significant, quantitative rise in exports despite sagging unit prices of many exportables, resulting from economic slowdown in the US, Euro Zone and Japan absorbing more than 50 per cent of Pakistan's total exports. The rise in total export earnings was attributable to higher exports of petroleum and petroleum products, synthetic textiles, raw cotton, leather manufactures, chemicals and pharmaceuticals, readymade garments, leather, towels and bed-wear. Imports during 2000-2001 remained below the annual target of US Dollars 10,964 million, and decelerated by 4.1 per cent to US Dollars 10,728.9 million compared with imports growth of 9.3 per cent in 1999-2000. Substantial reduction in imports of wheat, edible oils, transport equipment and some other items grouped as chemical and miscellaneous were the major factors that contained imports. Non-oil imports during the year came down 1.8 per cent to US Dollars 7,368.1 million. Total non-oil, non-food imports also stood nominally lower at US Dollars 6,378.1 million during the year.
Current Account
The current account deficit of the BOP (excluding official transfers) depicted a significant contraction of 55.5 per cent to US Dollars 509 million, owing to reduction in the trade deficit (-11.8 per cent) and a net increase in current private transfers (+26.2 per cent) despite the widening of the services account deficit (12.0 per cent). Current account balance (including official transfers) posted a surplus of US Dollars 301 million in contrast to a deficit of US Dollars 217 million, reflecting the impact of the recent adjustment in official transfers to treat the payments under Saudi oil facility as official grants. The trade deficit (Exchange records) narrowed due entirely to overriding export growth of 9.0 per cent compared with import growth of 5.9 per cent. Services account ended up with a larger deficit of US Dollars 3,130 million. Current private transfers posted a net increase of US Dollars 804 million owing to increase in SBP's foreign exchange purchases from the kerb market (from US Dollars 1,634 million to US Dollars 2,157 million), increase in
61 worker's remittances (from US Dollars 983 million to US Dollars 1,087 million) and increase in resident foreign currency deposits (from US Dollars 322 million to US Dollars 503 million). Worker's remittances registered an increase of 10.5 per cent to US Dollars 1.08 billion. Saudi Arabia continued to be the largest source of remittances to Pakistan accounting for 28 per cent of total remittances followed by US Dollars 12.4 per cent. Dubai 11.9 per cent and Kuwait 11.4 per cent.
Capital Account
The capital account of the BOP divulged expansion in FY2000-2001, as the outflows plummeted by 85.5 per cent to US Dollars 604 million. This resulted mainly from a plunge in withdrawals from non-resident foreign currency deposits (from -US Dollars 1,884 million to -US Dollars 96 million), an increase in short-term official assistance (a net inflow of US Dollars 384 million against a net outflow of US Dollars 995 million) and a reduction in net outflow under foreign economic assistance (US Dollars 445 million). Net foreign private investment excluding funds raised through public securities recorded a sharp fall of 66.5 per cent to US Dollars 182 million. Net FDI inflows declined by 31.4 per cent to US Dollars 322.4 million whereas portfolio investment exhibited a substantial net outflow of US Dollars 140.4 million. The combined impact of aforementioned developments led to an overall expansion of US Dollars 322 million against the deficit of US Dollars 3,895 million in 1999-2000, and a contraction in financing gap by 82.6 per cent to US Dollars 692 million.
Foreign Exchange Reserves
Pakistan's foreign exchange reserves rose to US Dollars 3,219 million as on end-June 2001 from US Dollars 1,968 million last year. The major development in Pakistan's foreign exchange reserves was the change in the method of presentation following the decision to return FE-25 deposits that has been placed with SBP. On the basis of previous definition, liquid reserves have increased from US Dollars 991 million at end-June 2000 to US Dollars 1,677 million as on end-June 2001. The SBP-held foreign exchange reserves augmented to reach the US Dollars 3.5 billion mark by end- December 2001 compared to US Dollars 2.13 billion by end-September 2001 and US Dollars 2.0 billion by end-June 2001.
Monetary and Credit Developments (2000-2001)
The simultaneous pursuit of macroeconomic stabilization and the liberalization of exchange rate regime created a very strong link between the Central Bank's management of the foreign exchange market and its monetary policy. The State Bank of Pakistan followed a tight monetary policy during the year 2000-2001 in order to back up exchange rate, to increase liquid foreign exchange reserves and to meet the quarterly targets set under stand-by arrangements. SBP monetary policy served as the first line of defense to calm the foreign exchange market. The measure taken by SBP in October 2000-enhancement of repo rate and increased cash reserve requirement (CRR) following the sharp depreciation of rupee proved successful not only to check the slide of rupee, but also facilitated to
62 meet the performance criteria set under the IMF and, therefore, for the first time, Pakistan completed its Stand By Arrangements (SBA) with IMF and established creditability with international finance institutions. However, this policy instance resulted in the increase in interest rates, which concerned the monetary authorities. But despite the higher interest rate, private sector credit expanded sharply during the year. The Credit Plan for FY2000-2001 was revised and brought in line with the thrust of the SBA and main changes focused on government borrowing for budgetary support and net foreign assets. However, the aggregate change in monetary growth was nominal. Actual developments in monetary and credit field were more encouraging. Overall money supply and inflation remained within their planned limits. Money supply (M2) increased by Rs. 126.0 billion (9.00%) during FY2000-2001 which was marginally higher at Rs. 120.1 billion than last year but well below the Credit Plan target of Rs. 144.3 billion. More importantly the composition of growth in M2 was encouraging; 58 per cent of the growth in M2 during FY2000-2001 was on account of net foreign assets, which corresponds to a build up in liquid reserves. Lower growth in net domestic assets was mainly due to net credit retirement of Rs. 46.2 billion by government sector of which Rs. 32.3 billion retirement was on account of budgetary support and Rs. 12.5 billion for commodity operations. The retirement of government borrowing also exceeded what had been projected in the revised Credit Plan. The lower lending to the government during the year facilitated private sector lending by the commercial banks, which increased from Rs. 15.4 billion last year to Rs. 54.2 billion during 2000-2001.
Monetary and Credit Developments (July-December 2001)
State Bank of Pakistan sufficiently eased off its monetary policy in the 1st half of FY2001-2002 after successful completion of SBA with IMF and achieving some comfortable level of foreign exchange reserves. The discount rate was lowered from 14 per cent to 13 per cent in July 2001 to 12 per cent in August, to 10 per cent in October and to 9 per cent effective January 23, 2002. As a result, State Bank of Pakistan was also able to reduce the yield on Treasury Bills of different maturities. This reduction in the discount rate was aimed at easing the money market and also inducing the financial institution to reduce their lending rates to help reviving the economy. The State Bank of Pakistan also took a number of policy measures including reduction in the rate of return under export finance scheme to boost exports which came under pressure after September 11 events. During July-December, 2001 money supply (M2) increased by Rs. 124.1 billion (8.1 per cent ) compared with Rs. 76.0 billion (5.4 per cent ) during the first half to last fiscal year. Developments in the foreign sector were completely reversed when net foreign assets increased by Rs. 71.3 billion during July-December, 2001 compared to a depletion of Rs. 4.0 billion in the corresponding period last year. Government retired less, Rs. 17.4 billion compared to Rs. 27.6 billion retired last year. Credit expansion in the private sector by commercial banks was sluggish during July-December, 2001 showing slow down in economic activity due to spill over effects of global recession, aftermath of September 11 events, start of war in Afghanistan and most recently escalated tension on the borders of the country. Net credit to private sector expanded by only Rs. 39.4 billion during July 1, 2001- December 31, 2001 compared with Rs. 80.6 billion in the same period last year. Private sector credit excluding export finance, however increased by Rs. 57.6 billion during July-December 2001 compared with Rs. 74.5 billion in the same period last year.
63
Pakistan's Foreign Trade (In Million US Dollars) ______Items 1996-97 1997-98 1998-99 1999-2000 2000-2001 ______Exports(f.o.b.) 8,096 8,434 7,528 8,190 8,926 Imports(f.o.b.) 11,241 10,301 9,613 9,602 10,195 Trade balance -3,145 -1,867 -2,085 -1,412 -1,269 ______Source: (Exchange Records-SBP)
Pakistan's Trade with ACU Member Countries (In Million US Dollars) ______Items 1996-97 1997-98 1998-99 1999-2000 2000-2001 ______Exports 233.03 321.8 404.3 286.3 294.2 Imports 589.6 408.7 296.4 340.3 698.7 Trade balance -356.6 -86.9 107.9 -54.0 -404.5 ______
64 MAIN ITEMS OF GOODS AND SERVICES TRADED WITH ACU COUNTRIES IN 2001 (In 000 US Dollars)
Bangladesh
EXPORTS IMPORTS Miscellaneous 109 Miscellaneous 797 Services: Services: 1.Other 197 1.Other 110 Transportation Transportation 2.Travel 39 2.Travel 107 3.Insurance 0 3.Insurance 0
------Total: 345 Total: 1,014 ------
India
EXPORTS IMPORTS Miscellaneous 1,512 Miscellaneous 424 Services: Services: 1.Other 3,732 1.Other 200 Transportation Transportation 2.Travel 68 2.Travel 218 3.Insurance 2 3.Insurance 0
------Total: 5,314 Total: 842 ------
Iran
EXPORTS IMPORTS Miscellaneous 304 Miscellaneous 163 Services: Services: 1.Other 375 1.Other 0 Transportation Transportation 2.Travel 4 2.Travel 8,804 3.Insurance 0 3.Insurance 0
------Total: 683 Total: 8,967 ------
65 Myanmar
EXPORTS IMPORTS Miscellaneous 1 Miscellaneous 5 Services: Services: 1.Other 0 1.Other 0 Transportation Transportation 2.Travel 0 2.Travel 15 3.Insurance 0 3.Insurance 0
------Total: 1 Total: 20 ------
Nepal
EXPORTS IMPORTS Miscellaneous 22 Miscellaneous 17 Services: Services: 1.Other 58 1.Other 0 Transportation Transportation 2.Travel 25 2.Travel 309 3.Insurance 0 3.Insurance 0
------Total: 105 Total: 326 ------
Sri Lanka
EXPORTS IMPORTS Miscellaneous 335 Miscellaneous 1,379 Services: Services: 1.Other 663 1.Other 0 Transportation Transportation 2.Travel 74 2.Travel 1,096 3.Insurance 0 3.Insurance 0
------Total: 1,072 Total: 2,475 ------
66 SRI LANKA
The Sri Lankan economy is estimated to have contracted by 1.3 per cent in 2001, primarily due to the significant deterioration in the global economy in 2001.* The prolonged drought and the country's uncertain political and economic environment also had a negative impact on the economic performance in 2001. The balance of payments recorded a surplus. The rate of unemployment increased marginally from 7.6 per cent to 7.8 per cent by the third quarter of 2001, particularly in the aftermath of the terrorist attack on the country's only international airport as tourism and related industries were severely affected. Sri Lanka's overall balance of payments reflected a surplus after three consecutive years of deficits. The overall balance in the balance of payments registered a surplus of US Dollars 220 million in 2001 against a deficit of US Dollars 522 million recorded in the previous year. However, the very adverse international economic environment caused a sharp decline in international trade in goods and services. Although the trade and current account deficits in the balance of payments declined, the overall balance in the balance of payments registered a lower surplus than originally estimated. Exports declined by 12.8 per cent, while imports declined by 14.9 per cent, reducing the trade deficit. As a result, the current account deficit narrowed significantly from 6.4 per cent of GDP in 2000 to 2.4 per cent in 2001. The slowing down in economic activities, particularly the reduction in international trade, reduced government revenue. As a result, the fiscal deficit widened to 10.8 per cent of GDP compared to the budgetary target of 8.5 per cent and last year's outcome of 9.9 per cent. Following the same trend, the current account deficit rose from 3.4 per cent of GDP in 2000 to 4.8 per cent of GDP in 2001. Price levels rose as a consequence of the drought affecting domestic food production and an increase in the price of imported commodities. Inflation, as measured by the increase in the Colombo Consumers' Price Index, rose to 14.2 per cent in 2001 from 6.2 per cent recorded in 2000. The inflationary pressure compelled the Central Bank to adopt a tighter monetary policy in the early part of the year, though the policy stance was less restrictive in the second half. Sri Lanka moved to a free floating exchange rate regime on 23 January 2001. Under the new exchange rate system, the exchange rate is determined by market demand and supply conditions. The rupee depreciated by 11.3 per cent against the US dollar during the year. ______* A provisional annual estimate based on the information available as at end January 2002
Agriculture
The agriculture sector was hard hit by a severe drought during the year. The output of all three plantation crops and paddy declined compared to the previous year. Tea production, which had been on an increasing trend during the last few years, declined by 3.5 per cent to 295 million kg. The output of rubber which had been decreasing during the last few years, owing to the poor prices, declined further. Coconut production, which reached the peak level in 2000, declined by 9.5 per cent to 2,800 million nuts during the year. The paddy output was also adversely affected due to the failures of both the North East and the South West monsoon. The extents sown and harvested during the
67 cultivation year declined resulting in an 8 per cent drop in the output of paddy.
Industry
The effect of the global recession, was reflected in the industrial sector. The output of factory industries declined by 3.8 per cent in 2001, reflecting a sharp reduction in output of export oriented industries and a slowing down of domestic market oriented industries. Industrial output, which grew by 0.5 per cent during first half of the year, declined by 10.4 per cent and 6.1 per cent, respectively during third and the fourth quarters of 2001, with wider and deeper slowdown of global economic activities. The reduction of industrial sector output is mainly attributed to the downturn of global markets, aggravated by the September 11 attacks on the USA, the terrorist attack on the Katunayake airport, and a reduction of business confidence due to pre-election political uncertainty. The September 11 attacks on the USA, which came on top of an already weakening global economy, abruptly disported economic activities and business sentiments significantly, resulting in a sharper drop in external demand for export items manufactured by Sri Lanka. The terrorist attack on the Katunayake airport in July 2001 also had a severe adverse impact on export oriented industries. The imposition of a surcharge on the insurance premium on flights and ships destined for Colombo following this incident adversely affected the competitiveness of exports, which resulted in cancellation of orders and high discounts for delays. As a result, many firms had accumulated large stocks of unsold goods. Also, the reduction in the availability of air cargo, which generally consists of high value garments and those of a promotional nature, where on-time delivery is an absolute necessity, had an adverse impact on apparel exports. In addition to these unfavorable developments, the global apparel and textile market became highly competitive with the emergence of regional trading blocks in Europe and North America and increased supply by China and other low-cost manufacturing countries including Eastern European countries. The domestic market oriented industries registered only a marginal growth in production during the year, as the slowing down in economic activity affected demand. The output of petroleum products declined due to the closure of the oil refinery of the Ceylon Petroleum Corporation (CPC) for about two months for routine maintenance work. The reduction of consumer spending due to stagnation of economic activities has had a severe adverse impact on domestic sales.
Inflation
The economy faced a rising trend in consumer prices throughout 2001, due to the combined effects of multiple factors predominantly related to the supply side. Inflation, as measured by the Colombo Consumer's Price Index (CCPI), registered an increase of 14.2 per cent during 2001, against the 6.2 per cent registered in 2000. The Colombo District Consumer Price Index (CDCPI) reflected an increase of 10.3 per cent during 2001. Meanwhile, the Wholesale Price Index (WPI) increased from 1.7 per cent in 2000 to 11.7 per cent in 2001. The weaker supply conditions, particularly of food items, due to the prolonged drought, the imposition of an
68 import surcharge of 40 per cent on most consumer items since mid February, the direct and indirect effects of administered price adjustments in late 2000 and 2001, the international price hikes of some key consumer and intermediate goods imports, the larger currency depreciation, and the lagged impact of wage increases from the previous year, kept consumer price inflation high in 2001.
Economic and Social Overheads
The total installed capacity of electricity expanded by 7 per cent to 1,901 MW during 2001. However, electricity generation, including power generation from hired power plants and self-generation, declined by 4 per cent to 6,602 GWh due to poor rainfall in catchment areas. Construction work on several power projects, including the 80 MW Kukule Ganga hydropower project and two combined cycle power projects each with 165 MW, was in progress during the year. Road and rail passenger transportation reflected moderate improvements during 2001. Total cargo handling at the Port of Colombo decreased by 2 per cent, while transshipment container handling increased by about 3 per cent. The telecommunication sector continued to expand and the total number of fixed telephone lines, including wireless local loop telephones, rose by 8 per cent raising the telephone density (telephones per 100 persons) from 4.2 to 4.4. Meanwhile, the use of mobile telephones increased rapidly by about 60 per cent.
External Trade and Balance of Payments
Total export earnings decreased by 12.8 per cent to US Dollars 4,817 million in 2001 due to lower export prices and volumes, in comparison to a 19.8 per cent increase in 2000. The decreased in export earnings was reflected in agricultural, industrial, mineral and other exports. Earnings from industrial exports decreased by 13.4 per cent in 2001 compared to an increase of 20.6 per cent in 2000 mainly due to a drop of 14.7 per cent in textile and garment exports. Textile and garment exports continued to be the leading sub-category, contributing 69 per cent to total industrial exports in 2001. The total outlay on imports, at US Dollars 5,974 million, registered a decrease of 18.4 per cent in 2001 against 22.4 per cent increase in 2000. Imports excluding aircraft registered a drop of 14.9 per cent during the year. Imports of consumption goods, intermediate goods and investment goods decreased by 11.0 per cent, 12.3 per cent and 37.8 per cent, respectively, in 2001. However, as the decline in imports was sharper than that in exports, the trade deficit in 2001 narrowed to US Dollars 1,157 million compared with a much higher deficit of US Dollars 1,798 million recorded in 2000. The services account (excluding the receipt of insurance claim for the aircraft damaged by a terrorist attack) registered a surplus of US Dollars 19.3 million reflecting a sharp drop of 49.2 per cent. This was mainly due to a drop in earnings from tourism and port related services. The deficit in the income account narrowed by 6 per cent in 2001 owing to a larger drop in interest payments than in interest income. The sharp drop in global interest rates reduced income payments by 21 per cent while interest income on external assets declined by 37 per cent during the year. Net current private transfers declined by 4 per cent to US Dollars 938 million while net current official transfers dropped by 12 per cent. As a result, the deficit in the
69 current account dropped significantly from US Dollars 1,065 million in 2000 (6.4 per cent of GDP) to US Dollars 377 million in 2001 (2.4 per cent of GDP). Financial and capital flows improved by 12 per cent reflecting higher capital flows to the government and an increase in foreign liabilities of commercial banks. The overall balance in the balance of payments registered a surplus of US Dollars 220 million in 2001 against a deficit of US Dollars 522 million in the previous year. In April 2001, Sri Lanka embarked on a economic reform program focused on fiscal consolidation and rebuilding of reserves, supported by an SDR 200 million Stand By Arrangement (SBA) of the International Monetary Fund (IMF), of which SDR 103.4 million was drawn. The government decided to use the SBA facilities of the IMF at this time, because of a decline in external reserves arising from a sharp increase in payments for oil imports and unanticipated increases in budget expenditure. As a result, gross official reserves improved during the year, from US Dollars 1,049 million at end 2000 to US Dollars 1,338 million at end 2001, and were sufficient to finance 2.7 months of imports.
External Debt
Sri Lanka's total external debt liabilities at the end of 2001 indicated a drop of 6 per cent. The drop was mainly due to a drop in private sector debt and the cross rate changes among major international currencies, in particular the depreciation of the yen by 12.6 per cent against the US dollar. Concessional debt accounted for 84 per cent of medium and long-term debt, while the remaining 16 per cent, including trade credits, fell into the non-concessional debt category. Central government debt, which accounted for 86 per cent of the total medium and long-term debt stock, decreased by 4 per cent over 2000. Concessional debt of the central government increased by 3 per cent while commercial debt increased by 19 per cent. Meanwhile, government guaranteed debt of public corporations and the private sector declined by 26 per cent, mainly due to a technical amortization of the debt by the Sri Lankan Airlines by US Dollars 148 million on account of the remaining capital value of the two aircraft destroyed in July 2001. External debt of public corporations and the private sector, not guaranteed by the government, declined by 11 per cent. Meanwhile, the liabilities to the IMF increased by US Dollars 55 million reflecting the net effect of the purchase of US Dollars 131 million under a Stand By Arrangement in April 2001 and repayments on account of borrowings under the Structural Adjustment Facility (SAF) and the Enhanced Structural Adjustment Facility (ESAF). The short-term debt stock of the country, at US Dollars 565 million at end of 2001, reflected a drop of 2 per cent. This was mainly due to a drop in trade credits by the private sector as imports declined sharply during the year. The share of short-term debt in the total debt stock remained unchanged at 6 per cent. Short-term debt as a percentage of official reserves declined from 54.9 per cent to 42.2 per cent at the end of the year. However, the total external debt to GDP ratio increased from 55.5 per cent in 2000 to 59 per cent in 2001, reflecting the reduction in gross domestic product in US dollar terms.
Fiscal Developments
70 Fiscal operations deteriorated further in 2001. Shortfalls in revenue and the overrun of current expenditure contributed to increase the total resource gap while non-realization of anticipated foreign financing and privatization receipts resulted in high borrowings from the domestic market. While government revenues declined from 16.8 per cent of GDP in 2000 to 16.5 per cent in 2001, government expenditure increased from 26.7 per cent of GDP to 27.3 per cent in 2001. Accordingly, the overall deficit increased to 10.8 per cent of GDP in comparison to the deficit of 9.9 per cent in 2000. Following the same trend, the current account deficit rose from 3.4 per cent in 2000 to 4.8 per cent of GDP in 2001. As a result, the net domestic borrowing exceeded the budgetary target by Rs. 66 billion to each Rs. 124 billion (8.8 per cent of GDP) in 2001. The limited availability of resources in the non-bank sector in the domestic market compelled the government to raise the balance resource requirement from the banking system (3.5 per cent of GDP). However, the impact of bank financing in 2001 was less expansionary when compared to 2000 as the entire bank financing was raised from commercial banks.
Monetary Developments
Monetary growth (M2b), which includes the operation of the domestic banking units and domestic operations of the foreign currency banking units, has been stable at around 13 per cent during 2001. The major contributory factor for the growth in broad money was the expansion in domestic credit. The emphasis of monetary policy was to maintain stability in financial markets. The Bank raised its Repurchase Rate and Reverse Repurchase Rate by 300 basis points to 20 per cent and 23 per cent in January 2001 to support stability in the exchange market. With the introduction of an independent float of the rupee on 23 January, stability in the foreign exchange market was restored, after an initial overshooting. This stability, along with the reductions in interest rates in major international markets, enabled the Central Bank to reduce its Repurchase rate and Reserve Repurchase rates on several occasions after February 2001. The pace of relaxation however was constrained by the rise in inflation in the first half. With the gradual reduction in inflationary pressure, a larger reduction in the Central Bank's key interest was effected during the second half the year. The Repurchase rate was reduced by 800 basis points to 12 per cent by end 2001, while the Reverse Repurchase rate was reduced by 900 basis points to 14 per cent. The Bank Rate was also reduced from 25 per cent to 23 per cent in July and further to 18 per cent in December 2001 to adjust it in line with the reductions in other market rates. As a further step in the Central Bank's move to reduce reliance on non-market oriented instruments in the conduct of monetary policy, a reduction of the Statutory Reserve Ratio (SRR) by one percentage point was also effected. This also served to reduce the implicit cost of funds of commercial banks, and to increase market liquidity.
71 MAIN ITEMS OF GOODS AND SERVICES TRADED WITH ACU COUNTRIES IN 2001 (In Million Sri Lanka Rupees)
1.BANGLADESH Total Exports 901.00
Aluminium wire, insulated wire & cable 49.05 Boards, panels, consoles, desks, cabinets, other furniture 23.61 Cartons, boxes, cases bags and other packing containers of paper paperboard 6.58 Chocolate and other food preparations containing cocoa 4.96 Coconut (copra), palm kernel or babassu oil and fractions thereof 149.47 Coral and similar materials, unworked or simply prepared 57.69 Enzymes; prepared enzymes not elsewhere specified or included 18.69 Finishing agents, dye carriers to accelerate the dyeing or fixing of dye-stuffs 7.77 Glazed ceramic flags and paving, hearth or wall tiles; glazed ceramic mosaic cubes 22.98 Insecticides, rodenticides, fungicides, herbicides, antisprouting products 27.28 Narrow woven fabric 9.13 Natural rubber, new pneumatic tyres, balata, gutta-percha, guayule 69.90 Nutmeg, mace and cardamons 3.22 Other articles of iron or steel 30.88 Other articles of plastics 70.51 Other lifting, handling, loading or unloading machinery 4.36 Paper or paperboard labels of all kinds, whether or not printed 17.37 Prefabricated buildings 31.26 Slide fasteners and parts 24.60 Synthetic filaments yarn (Other than sewing thread) 72.70 Synthetic organic colouring matter, whether or not chemically defined 22.35 Textile fabrics impregnated, coated, covered or laminated with plastics 18.57 Trailers and semi-trailers; other vehicles, not mechanically propelled 10.38 Woven fabrics of synthetic staple fibers 5.40 Others 142.29
Total Imports 183.00
Jute, woven fabrics of jute and other textile bast fibers, Men's or boys' suits 47.44 Medicaments 22.37 Pile fabrics, Tulles and other net fabrics 3.82 Sacks and bags, of a kind used for the packing of goods 4.15 Seeds of anise, badian, fennel, coriander, cumin, caraway or juniper 4.14 Textile fabrics impregnated, coated, covered or laminated
72 with plastics 12.43 Twine, cordage, ropes and cables, whether or not plaited or braided 7.15 Yarn of jute or of other textile bast fibers 36.79 Others 44.71
73 2.INDIA Total Exports 6,433.00
Aluminium waste and scrap 8.06 Articles of apparel and clothing accessories 33.92 Ash and residues containing metals 8.09 Automatic data processing machines and units thereof; magnetic or optical readers 73.74 Bread, pastry, cakes, biscuits and other bakers wares 5.73 Carbonates; peroxocarbonates; commercial ammonium carbonate 9.07 Cartons, boxes, cases bags and other packing containers of paper paperboard 121.71 Ceramic tableware, kitchenware, other household articles and toilet articles 6.63 Chocolate and other food preparations containing cocoa 19.88 Cloves (whole fruit, cloves and stems) 1,035.01 Containers for compressed or liquefied gas of iron or steel 24.11 Copper bars, rods and profiles 14.87 Copper waste and scrap 53.90 Coral and similar materials, unworked or simply prepared 25.61 Cotton waste (including yarn waste and garnetted stock) 6.73 Electric apparatus for line telephony or line telegraphy 40.41 Epoxides, epoxyalcohols, epoxyphenols and epoxyethers 7.00 Essential oils (terpeneless or not), including concretes and absolutes; resinoids 11.54 Extracts, essences and concentrates, of coffee, tea 7.53 Ferrous waste and scrap; remelting scrap ingots of iron or steel 374.14 Flour, meal and powder of the dried leguminous vegetables 11.00 Food preparations not elsewhere specified or included 6.09 Fruits, dried 91.90 Glycerol, crude; glycerol waters and glycerollyesrol water and glycerollyes 115.95 Insulated wire, cable 12.19 Iron and non-alloy steel in ingots or other primary forms 6.22 Knitting machines, stitch bonding machines and machines for making gimped yarn 6.40 Labels, badges and similar articles of textile materials 27.23 Lac; natural gums, resins, gumresins and oleoresins 54.79 Leather of bovine or equine animals, without hair on 23.25 Machinery for the industrial preparation 84.84 Medicaments 5.00 Men's or boys'shirts 13.55 Moulding boxes for metal foundry; mould bases; moulding patterns 33.78 Narrow woven fabric 18.24 Natural rubber, balata, gutta-percha, guayule, chicle and similar natural gums 63.78 Nonwovens coated, covered or laminated 17.15 Nutmeg, mace and cardamons 109.99 Oil-cake and other solid residues 47.17
74 Oils and other products of the distillation of high temperature coal tar 1,497.01 Other articles of plastics and articles 240.96 Other furniture and parts thereof 48.00 Other knitted or crocheted fabrics 42.48 Other nuts, fresh or dried, whether or not shelled or peeled 4.37 Other paper, paperboard, cellulose wadding and webs of cellulose fibers 6.17 Paints and varnishes (including enamels and lacquers) based on synthetic polymers 5.73 Paper or paperboard labels of all kinds 62.69 Parts and accessories of the motor vehicles 17.68 Paper of the genus piper; dried or crushed or ground fruits 416.03 Phosphinates, phosphonates, phosphates and polyphosphates 4.79 Pile fabrics knitted or crocheted 6.34 Plants and parts of plants (including seeds and fruit) 10.67 Plates, sheets, strip, rods and profile shapes, of vulcanised rubber 9.00 Polycarboxylic acids, their anhydrides, halides, peroxides and peroxyacids 8.74 Prefabricated buildings 26.34 Printed books, brochures, leaflets and similar printed matter 25.50 Refining copper and copper alloys, unwrought 145.22 Rosin and resin acids, and derivatives thereof; rosin spirit and rosin oils 12.19 Screws, bolts, nuts, coach-screws, screw hooks, rivets, cotters, cotter-pins 8.91 Synthetic filaments yarn (other than sewing thread) including synthetic 35.74 Tableware, kitchenware, other household articles and toilet articles 24.30 Tea, whether or not flavoured 123.24 Textile fabrics impregnated, coated, covered or laminated with plastics 21.02 Tin bars, rods, profiles and wire 5.84 Trailers and semi-trailers; other vehicles, not mechanically propelled 6.72 Trunks, suit cases, vanity cases, executive cases, brief cases, school satchels 5.09 Unwrought lead, tin, zinc 42.40 Wadding of textile materials and articles thereof; textile fibers 138.04 Yarn (other than sewing thread) of artificial staple fibers 10.17 Others 785.42
Total Import 53,750.00
Air or vacuum pumps, air or other gas compressors and fans 105.26 Angles, shapes and sections of iron or non-alloy steel 72.92 Antibiotics 132.56 Articles and equipment for general physical exercise, gymnastics, athletics 26.27 Articles for the conveyance or packing of goods,
75 of plastics; stoppers, lids, caps 31.00 Ball point pens felt tipped and other porous-tipped pens and markers; fountain pens 92.52 Bars and rods, hot-rolled in irregularly wound coils, of iron or non-alloy steel 476.21 Beauty or make-up preparations and preparations for the care of the skin 123.89 Bicycles and other cycles(including delivery tricycles) not motorised 34.60 Boards, panels, consoles, desks, cabinets and other bases 29.11 Bread, pastry, cakes, biscuits and other bakers wares 29.48 Buttons, press-fasteners, snap-fasteners and press-studs 20.45 Cane or beet sugar and chemically pure sucrose, in solid from 4,331.40 Carbon (carbon blacks and other forms of carbon elsewhere specified or included) 729.07 Carboys, bottles, flasks, jars, pots, phials, ampoules and other containers, of glass 57.91 Carpets and other textile floor coverings, woven, not tufted or flocked 69.99 Cartons, boxes, cases bags and other packing containers of paper paperboard 124.25 Centrifuges, including centrifugal dryers; filtering or purifying machinery 49.34 Ceramic sinks, wash basins, wash basin pedestals, baths, bidets 115.50 Chasis fitted with engines, for the motor vehicles 110.48 Chocolate and other food preparations containing cocoa 65.95 Compression-ignition internal combustion piston engines 70.47 Containers for compressed or liquefied gas of iron or steel 32.97 Converters, ladles,ingot moulcs and casting machines 25.50 Copper wire 45.60 Cotton carded or combed 30.59 Diamonds, whether or not worked, but not mounted or set 91.84 Dish washing machines; machinery for cleaning or drying bottles or other containers 39.90 Dried leguminous vegetables, shelled, whether or not skinned or split 218.50 Electric filament or discharge lamps, including sealed beam lamp 111.58 Electric generating sets and rotary converters 97.28 Electrical apparatus for switching or protecting electrical circuits 39.26 Electrical insulators of any material 109.17 Electro-mechanical domestic appliances with self-contained electric motor 139.77 Fish, dried, salted or in brine; smoked fish whether or not cooked 303.86 Flat-rolled products of iron or non-alloy steel 948.09 Food preparations not elsewhere specified or included 136.40 Friction material and articles thereof 45.53 Gelatin (including gelatin in rectangular (including square) sheets) 34.70 Glazed ceramic flags and paving, hearth or wall tiles; glazed ceramic mosaic cubes 333.15 Goat or kid skin leather, without hair on 28.53 Grapes, fresh or dried 24.24 Ground-nuts, not roasted or otherwise cooked 210.16
76 Human blood; animal blood prepared for therapeutic, prophylactic or diagnostic uses 104.89 Hypochlorites; commercial calcium hypochlorite; chlorites; hypobromites 50.25 Inner tubes, of rubber 79.75 Insecticides, rodenticides, fungicides, herbicides, antisprouting products 245.33 Instruments and appliances used in medical surgical, dental or veterinary sciences 103.58 Insulated wire, cable (including co-axial cable) 50.26 Lentiles 1,582.80 Machinery, plant or laboratory equipment, whether or not electrically heated 231.34 Medicaments 2,709.56 Men's or boys' suits, ensembles, jackets, blazers, trousers, bib and brace overalls 106.28 Mixtures of odoriferous substances and mixtures (including alcoholic solutions) 76.94 Motor cars and other motor vehicles, Motorcycles including mopeds 2,744.40 Moulding boxes for metal foundry; mould bases; moulding patterns 75.00 New pneumatic tyres, of rubber 155.41 Newsprint, in rolls or sheets 76.51 Oil-cake and other solid residues 1,250.22 Onions, shallots, garlic, leaks and other alliaceous vegetables, fresh or chilled 1,413.92 Organic surface-active agents (other than soap) 95.72 Orthopedic appliances, including crutches, surgical belts and trusses 35.71 Other articles of iron or steel 60.69 Other articles of plastics 61.75 Other bars and rods of other alloy steel; angles and shapes 145.52 Other inorganic acids and other inorganic oxygen compounds of non-metals 29.95 Other knitted or crocheted fabrics 201.10 Other lifting, handling, loading or unloading machinery 92.56 Other oil seeds and oleaginous fruits whether or not broken 27.32 Other plates, sheets, film, foil and strip, of plastics non-cellular and not reinforced 128.03 Other printed matter, including printed pictures and photographs 38.04 Other slag and ash luding seaweed ash (kelp) 64.78 Other tubes, pipes and hollow profiles 462.63 Other woven fabrics of synthetic staple fibers 420.46
77 Paints and varnishes (including enamels and lacquers) based on synthetic polymers 67.26 Paper and paperboard, coated on one or both sides with kaolin 498.16 Paper or paperboard labels of all kinds, whether or not printed 28.75 Parts and accessories of the motor vehicles, engines 1,033.66 Paper of the genus piper; dried or crushed or ground fruits 1,513.74 Prepared rubber accelerators; compound plasticisers for rubber or plastics 55.01 Petroleum oils and oils obtained from bituminous minerals, other than crude 977.67 Photographic plates and film in the flat, sensitised, unexposed 64.46 Plants and parts of plants (including seeds), of a kind used primarily in perfumery 52.90 Polishes and creams, for footwear, furniture, floors, coachwork, glass or metal 145.32 Polymers of propylene or of other olefins, in primary forms 508.48 Polymers of vinyl chloride or of other halogenated olefins, in primary forms 47.92 Portland cement, aluminous cement, slag cement supersulphate cement 2,492.27 Potatoes, fresh or chilled 273.34 Preparations for use on the hair 35.01 Prepared binders for foundry moulds or cores 74.70 Pre-shave, shaving or after-shave preparations, personal deodorants 97.50 Primary cells and primary batteries 108.08 Printed books, brochures, leaflets and similar printed matter 393.87 Printing ink, writing or drawing ink and other inks 55.84 Razors and razor blades (including razor blade blanks in strips) 72.69 Reception apparatus for radio-telephony, radio-telegraphy or radio-broadcasting 339.78 Rice 352.61 Sacks and bags, of a kind used for the packing of goods 49.31 Sanitary ware and parts thereof, of iron or steel 58.58 Saturated acyclic monocarboxylic acids and their anhydrides, halides, peroxides 30.17 Seeds of anise, badian, fennel, coriander, cumin, caraway or juniper 101.83 Semi-finished products of iron or non-alloy steel 844.42 Sewing machines, other than book-sewing machines 87.14 Sodium hydroxide (coastic soda); potassium hydroxide (caustic potash) 48.65 Stoves, ranges, grates, cookers 31.63 Structured and Parts of structures 99.58 Sulphates; alums; peroxosulphates (persulphates) 70.71 Synthetic rubber and factice derived from oils 412.71 Taps, cocks, valves and similar appliances for pipes, boiler shells, tanks 108.33 Tea, whether or not flavoured 154.83 Textile fabrics impregnated, coated, covered or laminated with plastics 91.93
78 Track suits, ski suits and swimwear; other garments 624.63 Tractors 51.35 Transmission shafts (including camshafts and crank shafts) and cranks 63.57 Tubes, pipes and hollow profiles, seamless, of iron (other than cast iron) or steel 104.95 Tulles and other net fabrics, not including woven, knitted or crocheted fabrics 33.73 Turbo-jets, turbo propellers and other gas turbines 674.33 Uncoated kraft paper and paperboard, in rolls or sheets 81.69 Uncoated paper and paperboard 1,263.92 Unmanufactured tobacco; tobacco refuse 28.41 Vegetable products not elsewhere specified or included 328.95 Vulcanised rubber thread and cord 62.60 Wadding, gauze, bandages and similar articles 62.29 Weighing machinery including weight opera 20.00 Wheat 25.93 Wire of iron or non alloy steel 145.10 Worked monumental or building stone (except slate) and articles thereof 35.15 Woven fabrics of synthetic staple fibers 265.14 Yarn (other than sewing thread) of synthetic staple fibers 274.78 Others 15,258.69
3.IRAN Total Exports 2,632.00
Activated carbon; activated natural mineral products 18.14 Coconuts, Brazil nuts and cashew nuts, fresh or dried 34.08 Machinery & parts 20.19 New pneumatic tyres, of rubber, inner tubes, natural rubber, balata, gutta-percha 32.95 Precious stones (other than diamonds) and semi-precious stones 1.99 Printed circuits 3.02 Tea, whether or not flavoured 2,515.49 Trunks, suit cases, vanity cases, executive cases, brief cases, school satchels 3.61 Others 2.53 Total Imports 20,839.00
Bombs, grenades, torpedoes, mines, missiles, and similar ammunitions 113.13
79 Carbon (carbon blacks and other forms of carbon), hydrocarbons 38.43 Dried leguminous vegetables, shelled, whether or not skinned or split 4.13 Grapes & other fruit, fresh or dried 7.62 Petroleum jelly; paraffin wax, micro crystalline petroleum wax, slac wax, ozokerite 41.84 Petroleum oils and obtained from bituminous minerals, crude 20,569.73 Synthetic rubber and factice derived from oils, in primary forms or in plates, sheets or strip 47.62 Zinc oxide; zinc peroxide 6.26 Others 10.24
4.MYANMAR Total Exports 53.00
New pneumatic tyres, of rubber 4.46 Nutmeg, mace and cardamons 1.58 Other paints and varnishes (including enamels, lacquers and distempers) 24.17 Soap; organic surface-active products and preparations for use as soap 2.34 Synthetic filaments yarn(other than sewing thread) 3.04 Transmission Apparatus 8.38 Wadding of textile materials and articles thereof; textile fibers 1.13 Others 7.90
Total Imports 112.00
Dried leguminous vegetables, shelled, whether or not skinned or split 73.05 Fish, dried, salted or in brine; smoked fish 2.05 Other bars and rods of iron or non-alloy steel 3.76 Other oil seeds and oleaginous fruits whether or not broken 2.01 Other woven fabrics of synthetic staple fibers 1.31 Plants and parts of plants (including seeds and fruit), of a kind used primarily in perfumery 1.77 Rice 2.50 Seeds of anise, badian, fennel, coriander, cumin, caraway or juniper 8.20 Unmanufactured tobacco; tobacco refuse 11.07 Others 6.28
80 5.NEPAL
Total Exports 30.00
Glazed ceramic flags and paving, hearth or wall tiles; glazed ceramic mosaic cubes 0.64 New pneumatic tyres, of rubber 0.93 Other articles of plastics and articles 23.15 Plants and parts of plants (including seeds and fruit) 0.43 Stoppers, caps and lids (including crown corks, screw caps, and pouring stoppers) 2.15 Tea, whether or not flavoured 0.49 Others 2.21
Total Import 0.82
Tools tool bodies, and tool handles, broom or brush bodies 0.82
6.PAKISTAN Total Exports 2,222.00
Cellulose and its chemical derivatives, not elsewhere specified or included 11.41 Coconuts, Brazil nuts and cashew nuts, fresh or dried 224.74 Copra 606.08 Cotton waste (including yarn waste and garnetted stock) 7.74 Fruits, dried 70.63 Natural graphite 19.99 Natural rubber, balata, gutta-percha, guayule, chicle and similar natural gums 455.31 Nutmeg, mace and cardamons 36.45 Oil-cake and other solid residues 4.53 Other plates, sheets, film, foil and strip, of plastics non-cellular and not reinforced 26.23 Paper or paperboard labels of all kinds 7.91 Synthetic filaments yarn (other than sewing thread) 6.53 Tableware, kitchenware, other household articles and toilet articles 3.45 Tea, whether or not flavoured 453.63 Titanium ores and concentrates 6.20 Vegetable materials of a kind used primarily in brooms or in brushes 62.65 Vegetable products not elsewhere specified or included 117.72 Yarn of other vegetable textile fibers; paper yarn, twine, cordage, ropes and cables 36.11 Others 64.69
Total Imports 6,597.00
Apples, pears and quinces, fresh 22.65 Articles and equipment for general physical exercise, gymnastics, athletic, other sports 4.03 Articles for the conveyance or packing of goods,
81 of plastics; stoppers, lids, caps 6.91 Auxiliary machinery 4.95 Bed linen, table linen, toilet linen and kitchen linen 6.64 Citrus fruit, fresh or dried 101.10 Cotton waste, Cotton not carded or combed, Cotton, sewing thread 103.16 Dried leguminous vegetables, shelled, whether or not skinned or split 24.71 Electrical capacitors, fixed variable or adjustable, electric filament or discharge lamps 10.31 Fiberboard of wood or other ligenous materials 3.28 Fish, dried, salted or in brine; smoked fish 1,221.63 Food preparations not elsewhere specified or included 40.01 Ginger, saffron, turmeric (curcuma), thyme, bay leaves, curry and other spices 36.76 Gloves, mittens and mitts 25.65 Grapes, fresh or dried 5.22 Hybrazine and hydroxylamine and their inorganic salts; other inorganic bases 9.61 Insulated wire, cable 2.38 Leather of other animals, without hair on 114.51 Lentoles 6.70 Machinery, plant or laboratory equipment 18.31 Medicaments 272.02 Motorcycles (including mopeds) and cycles fitted with an auxiliary motor 28.85 Onions, shallots, garlic, leaks and other alliaceous vegetables, fresh or chilled 442.25 Other articles of plastics and articles of other materials 7.29 Other knitted or crocheted fabrics 103.39 Other made up clothing accessories; parts of garments or of clothing accessories 4.69 Other plates, sheets, film, foil and strip, of plastics non-cellular and not reinforced 7.14 Other tubes, pipes and hallow profiles 107.85 Particles board and similar boards of wood or other ligenous materials 5.41 Parts and accessories of vehicles 11.83 Parts of footwear 16.23 Pile fabrics, including "long pile" fabrics and terry fabrics, knitted or crocheted 16.97 Plants and parts of plants (including seeds and fruit), of a kind used primarily in perfumery 8.90 Polymers of vinyl chloride or of other halogenated olefins, in primary forms 134.27 Potatoes, fresh or chilled 548.50 Railway or tramway goods vans and wagons, not self-propelled 249.18 Rice 566.66 Seeds of anise, badian, fennel, coriander, cumin, caraway or juniper 32.60 Sheep or lamb skin leather, without wool on 34.70 Sugar confectionery (including white chocolate), not containing cocoa 44.81 Synthetic filaments yarn (other than sewing thread) 21.43 Terry towelling and similar woven terry fabrics 11.84 Textile fabrics impregnated, coated covered or laminated with plastics 13.79
82 Tractors 5.69 Tubes, pipes and hollow profiles, seamless, of iron (other than cast iron) or steel 20.43 Woven fabrics of synthetic staple fibers 85.88 Yarn (other than sewing thread) of synthetic staple fibers 31.21 Others 1,994.67
83
TRADE THROUGH FTZ IN 2001 (In Million SLRS) IMPORTS
AS A PERCENTAGE OF TOTAL IMPORTS OF COUNTRY TOTAL VALUE (CIF) THE RELEVANT COUNTRY BANGLADESH 19.66 10.74 BHUTAN - - INDIA 9,278.36 17.26 IRAN 175.65 0.84 MYANMAR 7.68 6.86 NEPAL 0.82 100.00 PAKISTAN 2,209.58 33.49
EXPORTS
AS A PERCENTAGE OF TOTAL EXPORTS OF COUNTRY TOTAL VALUE (CIF) THE RELEVANT COUNTRY BANGLADESH 277.10 30.75 BHUTAN - - INDIA 1,768.50 27.49 IRAN 239.27 9.09 MYANMAR 26.67 50.32 NEPAL 26.04 86.80 PAKISTAN 63.59 2.86
84
Clearing Operations
and
Miscellaneous Activities
CLEARING OPERATIONS
In financial year 2001, the ACU further increased its operations, bolstered by the continuing strong performance of all member countries except Sri Lanka. Output growth strengthened for most participant countries. The annual growth rate reached to 5 per cent as a group in 2001 against 29 per cent in 2000. The total transactions (one way plus accrued interest) which was booked at the ACU Secretariat recorded to unprecedented amount of US Dollars 3,553.7 million while the total trade volumes comprising exports, imports and accrued interest registered US Dollars 7,107.3 million and rose 5 per cent over the previous year. Bhutan with 1,079 per cent recorded the highest annual growth rate in 2001, Myanmar, Nepal and Bangladesh stood at the next rows with 169, 60 and 17 per cent respectively. In 2001, except Sri Lanka all ACU member countries recovered their share of trade. The trade share of India, Islamic Republic of Iran and Bangladesh were 41, 23 and 18 per cent. Sri Lanka, Pakistan, Nepal, Myanmar and Bhutan registered 10, 7, 0.28, 0.13 and 0.03 per cent respectively. Similar to the previous year India with total trade of US Dollars 2,913.4 million stood at the top followed by the Islamic Republic of Iran, Bangladesh, Sri Lanka, Pakistan, Nepal, Myanmar and Bhutan with US Dollars 1,645.6, 1,266.2, 727.9, 523.2, 19.7, 9.0 and 2.2 million respectively. In the year under report the ACU Secretariat has issued a number of accounting vouchers, monthly statements, monthly news letters and lots of swift, telex and fax messages. The ACU paper works and communication during the year 2001 were as follows:
Description Number ______1) Accounting Vouchers 6,964 2) Incoming Swifts/Telexes 2,480 3) Outgoing Swifts/Telexes 1,504 4) Monthly Statements 613 5) Letters/Faxes 420 6) News Letters 12
86 Settled Cleared Through The ACU 1993-2001 Total Transactions Cleared/Settled 1993 1994 1995 1996 1997 1998 1999 2000 2001 0
500
4000 3500 3000 2500 2000 1500 1000 Million U.S. Dollars U.S. Million
ASIAN CLEARING UNION * TOTAL TRANSACTIONS ROUTED THROUGH ACU 2000-2001 (In U.S. Dollars)
______
Country 2000 2001 Change (%) ______
BANGLADESH 1,084,342,924.20 1,266,235,513.09 +181,892,588.89 17
BHUTAN 185,740.79 2,189,916.71 + 2,004,175.92 1079
INDIA 2,646,287,519.03 2,913,414,399.44 +267,126,880.41 10
IRAN 1,629,358,105.32 1,645,609,009.58 + 16,250,904.26 1
MYANMAR 3,348,211.54 9,010,174.81 + 5,661,963.27 169
NEPAL 12,347,176.40 19,717,028.08 + 7,369,851.68 60
PAKISTAN 518,388,373.81 523,233,844.28 + 4,845,470.47 1
SRI LANKA 872,812,432.35 727,921,751.33 -144,890,681.02 -17 ______Total 6,767,070,483.44 7,107,331,637.32 +340,261,153.88 5 ______
* Including interest.
88 ASIAN CLEARING UNION
TRANSACTIONS* CLEARED-SETTLED IN FOREIGN EXCHANGE 2001 ( IN US DOLLARS )
Total Total Cleared Settled in Transactions Transactions Balance in Foreign Country Debited Credited the Exchange system (%) (%) BANGLADESH 1,189,794,610.84 76,440,902.25 - 1,113,353,708.59 6 94
BHUTAN 605,396.32 1,584,520.39 979,124.07 38 62
INDIA 1,105,666,596.01 1,807,747,803.43 702,081,207.42 61 39
IRAN 219,278,511.67 1,426,330,497.91 1,207,051,986.24 15 85
MYANMAR 7,240,756.49 1,769,418.32 - 5,471,338.17 24 76
NEPAL 15,222,234.84 4,494,793.24 - 10,727,441.60 30 70
PAKISTAN 347,147,780.03 176,086,064.25 - 171,061,715.78 51 49
SRI LANKA 668,709,932.46 59,211,818.87 - 609,498,113.59 9 91
TOTAL 3,553,665,818.66 3,553,665,818.66 +1,910,112,317.73 46 54
* Including Interest
89 CREDIT POSITIONS
India and the Islamic Republic of Iran with US Dollars 1,807.8 and 1,426.3 million, similar to the previous year were the main creditors. Pakistan, Bangladesh Sri Lanka, Myanmar and Nepal with US Dollars 176.1, 76.4, 59.2, 4.5 and 1.8 million recorded declines in comparison to the preceding year, while Bhutan improved its credit position to US Dollars 1.6 million or positive growth of 2,013 per cent. In 2001, India and Iran recorded the main share of credit transactions of 51 and 40 per cent. Pakistan, Bangladesh, Sri Lanka, Nepal, Myanmar and Bhutan totally received the remind share (9 per cent). Bhutan with annual growth of 2,013 per cent stood at the top and followed by India and Iran with 13 and 1 per cent. Annual growth of Sri Lanka, Myanmar, Pakistan, Nepal and Bangladesh in credit positions decelerated to 31, 24, 7 and 6 per cent respectively.
90 Credits (2001)
Million U.S. Dollars Myanmar Nepal Pakistan Bangladesh 0% 2% 0% 5%
Iran India 40% 51%
Sri Lanka Bhutan 2% 0% DEBIT POSITIONS
Bangladesh with US Dollars 1,189.8 million was the main debtor and followed by India, Sri Lanka, Pakistan, Islamic Republic of Iran, Nepal, Myanmar and Bhutan with US Dollars 1,105.7, 668.7, 347.2, 219.3, 15.2, 7.2 and 0.6 million respectively. The highest annual growth belonged to Myanmar with 618 per cent. Bhutan, Nepal, Bangladesh, Pakistan, India and Iran also improved their debit annual growth of 447, 103, 19, 8, 6 and 1 per cent respectively. Debit share of member countries were distributed moderate among the central banks. Bangladesh with 34 per cent, improved its position against 31 per cent in 2000, however, India registered the same percentage of the preceding year (31 per cent). Share of Sri Lanka was 19 per cent as compared to 23 per cent in 2000, while Pakistan and Iran remained at the same level in the previous year (10 and 6 per cent).
92 Debits ( 2001 )
Million U.S. Dollars
Bhutan 0% Sri Lanka 19% Bangladesh 34% Myanmar 0%
Iran 6% Pakistan 10%
Nepal 0% India 31% NET CREDIT/DEBIT POSITIONS
Islamic Republic of Iran improved its surplus and recorded to unprecedented amount of US Dollars 1,207.1 million against US Dollars 1,195.1 million in 2000. In percentage term, Iran recorded 1 per cent over the preceding year. India and Bhutan also registered surplus of US Dollars 702.1 and 0.98 million respectively. India also exceeded its net credit position of US Dollars 149.6 or 27 per cent over previous year. Bhutan changed its net position from debit to credit and reached to US Dollars 0.98 million by compensating of US Dollars 1.0 million. Bangladesh for the nine successively years stood at the top net debit positions with US Dollars 1,113.4 million or 21 per cent over the preceding year. Sri Lanka, Pakistan, Nepal and Myanmar with US Dollars 609.5, 171.1, 10.7 and 5.5 million respectively located at the next places. Except Sri Lanka, deficit of Bangladesh, Pakistan and Nepal improved, however, Sri Lanka's ACU balance of payment recovered.
93 Credit ( 2001 ) Debit Net Credit/Debit Positions BANGLADESH BHUTAN INDIA IRAN MYANMAR NEPAL PAKISTAN SRILANKA 0
800 600 400 200
2000 1800 1600 1400 1200 1000 Million U.S. Dollars U.S. Million INTEREST PAID/RECEIVED
The total interest paid/received during 2001 reached to amount of US Dollars 7.5 million and decreased by 31 per cent when compared to the previous year. Despite of the annual growth rate of 5 per cent, the total interest (paid/received) has been reduced due to reduction in US Dollar rate of interest during the calendar year 2001.
INTEREST RATES
According to the rule (9), sub-rule (a) of the ACU procedure Rules, the interest rates applicable to the settlement period of the year, are the closing rates of interest of one month Euro-Dollars deposit, on the first working day of the last week of the previous calendar month, announced by the Bank for International Settlements (BIS). In 2001, the monthly interest rates slowly declined and on average stood at 3.952 per cent or 36 per cent less than the average rate of the preceding year.
January February March April May June 6.410 5.400 5.150 4.810 4.780 3.820
July August September October November December 3.510 3.570 3.420 2.420 2.190 1.940
95 The Average Interest Rates Applied % ( 1980-2001 )
18
16
14
12
10
8
6
4
2 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 SWAP FACILITY
In accordance with Article (VIIA) Agreement Establishing the Asian Clearing Union, the Currency SWAP Arrangement became available to all debtor participants during a settlement period, to avail two-month facility for settling imbalances in clearing. Every eligible participant shall be entitled to the facility from every other participant up to 20 per cent of the average gross payment made by it through the ACU mechanism to other participants during the three previous calendar years. In 2001 the total entitlement of each member country to avail SWAP facility of other members were allocated as follows:
Bangladesh 228.7 Million US Dollars Bhutan - India 138.6 " Iran 42.9 " Myanmar 0 " Nepal 2.5 " Pakistan 42.1 " Sri Lanka 133.8 " ______Total 588.6 "
In 2001, Pakistan and Bangladesh applied SWAP facility. At the end of February 2001, State Bank of Pakistan availed US Dollars 42.1 million from Bangladesh, India, Iran and Sri Lanka for US Dollars 4.6, 16.0 16.4 and 5.1 million respectively. The second applicant was Bangladesh with US Dollars 150.0 million which was paid by India, Nepal, Pakistan and Sri Lanka in early November 2001. India paid 90 per cent equivalent to US Dollars 135.0 million. The rest was paid by Nepal, Pakistan and Sri Lanka equivalent to US Dollars 1.5, 12.0 and 1.5 million respectively. The total amount of SWAP facility, which has been used by the member central banks since inception of this arrangements in ACU from September 1989 to end of December 2001 was US Dollars 630.8 million.
97
ASIAN CLEARING UNION SWAP PAYMENTS AND RECEIPTS BY THE ACU MEMBER COUNTRIES 1997-2001 ( IN US DOLLARS)
1997 1998 1999 2000 2001
Payments Receipts Payments Receipts Payments Receipts Payments Receipts Payments Receipts BANGLADESH 2,211,319.14 0 428,354.30 0 0 0 3,175,608.65 0 4,628,030.00 150,000,000.00
BHUTAN 0 0 0 0 0 0 0 0 0 0
INDIA 12,383,387.16 0 2,284,556.29 0 0 0 11,258,976.14 0 150,987,740.00 0
IRAN 21,228,663.71 0 3,426,834.43 0 0 0 10,970,284.44 0 16,408,470.00 0
MYANMAR 0 0 0 0 0 0 0 0 0 0
NEPAL 0 0 0 0 0 0 0 0 1,500,000.00 0
PAKISTAN 0 44,226,382.73 0 7,139,238.39 0 0 0 28,869,169.58 12,000,000.00 42,073,000.00
SRI LANKA 8,403,012.72 0 999,493.37 0 0 0 3,464,300.35 0 6,548,760.00 0
TOTAL 44,226,382.73 44,226,382.73 7,139,238.39 7,139,238.39 0 0 28,869,169.58 28,869,169.58 192,073,000.00 192,073,000.00
98
ACTIVITIES TO ENLARGE THE ROLE OF ACU IN THE REGION
The following efforts have been done during the year 2001. In April 2001: The 57 session of the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) was held at the United Nations Conference Center in Bangkok, Thailand from 19-25 April 2001. The session was attended by representatives from 57 countries, as well as representatives of United Nations bodies specialized agencies, intergovernmental organizations. Observers were also present from non-governmental organization in general consultative statues. The session was declared open by the chairman of the previous session, H. E. Dr. Kamal Kharazi, Minister of Foreign Affairs, the I.R. of Iran, then H. E. Mr. Thaksin Shinawatra, Prime Minister of Thailand, delivered the inaugural address and extended a warm welcome to delegates, he noted that the theme of the current session was an appropriate one for the Commission to consider. As a result of its deliberations a meaningful and constructive model, or models, for balanced development and sustained growth could be identified. That would prove useful timely to member governments in overcoming the Asian economic and financial crisis as well as the impending world economic slowdown. The representative of ACU submitted a report under item 7(a) Regional Economic Cooperation and highlighted the economic performance of the ACU during 2000 and the recent developments in ACU, comprising: a) Commencing the operation of the Royal Monetary Authority of Bhutan from September 2000 b) Creation of the Fund by contribution of member countries c) Membership and operational of the Bangladesh bank and the State Bank of Pakistan to the Swift network as the modern financial communications technology d) Improving the methods of funding of the ACU accounts by adding tome in addition to spot from first of March 2001 In May 2001: The 30th meeting of the Board of Directors of the Asian Clearing Union (ACU) was held in Yangon, Myanmar. H. E. Mr. Khin Maung Thein, the Minister of Finance and Revenue of Myanmar, officiated the Opening Ceremony. In his opening address, H. E. Mr. Khin Maung Thein, stated the fact that Myanmar has always supported the objectives of the ACU and will continue to coordinate with other members to further strengthen the ACU's role. He stressed that in the face of a slowdown in the global economy, the members need to not only sustain the momentum of growth in each individual economy and the ACU region as a whole but also to concentrate on preventing the recurrence of another financial crisis. Governors of Bangladesh Bank, Nepal Rastra Bank, the State Bank of Pakistan and the Central Bank of Sri Lanka, Managing Director of the Royal Monetary Authority of Bhutan, Deputy Governor of the Reserve Bank of India and Vice Governor of the Central Bank of the Islamic Republic of Iran alongwith senior officials from the Central Bank of Myanmar attended the meeting. The Secretary General of the ACU and a representative of ESCAP were also present. A representative each from the ASEAN Secretariat and the Monetary Authority of Maldives also attended the meeting as observers. Mr. Kyaw Kyaw Maung, Governor of the Central Bank of Myanmar, and the current Chairman of the ACU
99
for the year 2001, presided over the meeting. In his welcome address, Governor Kyaw Kyaw Maung, noted that in its existence for nearly three decades, progress has been made in the ACU's multilateral clearing arrangements for settlement of current trade transactions between member central banks. He stated that further efforts are needed to enhance trade and economic growth in the region and urged for continuous efforts to strengthen the role of the ACU. The ACU Secretary General presented the Annual Report which reviewed the member countries' economic performances as well as ACU clearing operations and it was approved by the ACU Board of Directors. The meeting deliberated on issues of common interest of the member countries, as well as the measures to further strengthen the role of the ACU and enlarge its membership. The Governors of the Central Bank of Sri Lanka and the Reserve Bank of India were elected as Chairman and Vice-Chairman of the ACU respectively for the year 2002. Colombo, Sri Lanka was chosen as the venue for the 31st ACU Board Meeting.
100
TWENTY SIX YEARS OF ACU OPERATIONS
In 2001 ACU completed the twenty sixth year of its operations. The Agreement Establishing the Asian Clearing Union was signed in December 1974 and commenced its Operations in November 1975. The Board of Directors accepted the offer of the Central Bank of the Islamic Republic of Iran to act as the Agent Bank. The main objective of the Asian Clearing Union are as follows: 1- Economizing on the use of exchange reserves by utilization of national currencies 2- Shifting banking services from non-domestic bank to domestic one 3- Providing short term credit facilities for 2 months The volume of trade (Exports plus Imports) through the ACU since 1976 to the end of 2001 has been a fast growing trend from US Dollars 51.4 million to US Dollars 7,107.3 million in 2001. During existence of the ACU activities, the economic situation in the ACU countries has been changed, this necessitated changes in the Asian Clearing Union mechanism as well.
101
ASIAN CLEARING UNION Total Transactions Channelled Through the ACU From 1975 to 2001 ( Million U.S. Dollars )
Year Yearly Transactions Cleared in the System Settled in Foreign Exchange
Amount* (%) Growth Amount (%) Amount (%) 1975 0.44 - 0.09 20 0.35 80 1976 25.72 62 4.12 16 21.60 84 1977 79.36 205 16.67 21 62.69 79 1978 137.60 62 39.90 29 97.70 71 1979 161.31 14 83.88 52 77.43 48 1980 182.94 13 98.79 54 84.15 46 1981 269.39 63 166.92 62 102.47 38 1982 300.41 19 196.63 65 103.78 35 1983 498.66 71 192.32 39 306.34 61 1984 662.84 39 322.24 49 340.60 51 1985 605.20 - 8 373.50 62 231.70 38 1986 690.62 - 1 581.12 84 109.50 16 1987 625.34 -18 396.97 64 228.37 36 1988 940.84 45 698.52 74 242.32 26 1989 1,041.78 16 832.39 80 209.39 20 1990 1,366.54 24 947.79 69 418.75 31 1991 1,851.44 34 1,424.35 77 427.09 23 1992 1,928.32 1 1,172.46 61 755.86 39 1993 1,448.88 -24 1,018.00 70 430.88 30 1994 1,965.38 32 1,110.71 57 854.67 43 1995 2,702.90 30 1,353.42 50 1,349.48 50 1996 3,161.10 17 1,448.30 46 1,712.80 54 1997 2,654.95 -16 1,251.60 47 1,403.35 53 1998 2,842.77 7 1,130.61 40 1,712.16 60 1999 2,630.74 - 7 1,057.39 40 1,573.35 60 2000 3,383.54 29 1,634.66 48 1,748.88 52 2001 3,553.67 5 1,643.56 46 1,910.11 54 Total 35,712.68 - 19,196.91 54 16,515.77 46
102
* Amount relevant to years 1975 to 1995 converted from SDRs to US Dollars, however, growth obtained before conversion.
103 Total Transactions Channelled Through The ACU
4000
3500
3000
2500
2000
1500
Million U.S. Dollars 1000
500
0 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Tables
ASIAN CLEARING UNION * TOTAL DEBIT & CREDIT TRANSACTIONS BOOKED BY THE MEMBER CENTRAL BANKS UNDER THE ACU MECHANISM, 2001 ( IN US DOLLARS )
TABLE (1)
Country Debit (-) Credit (+) Net
BANGLADESH 1,189,794,610.84 76,440,902.25 -1,113,353,708.59
BHUTAN 605,396.32 1,584,520.39 979,124.07
INDIA 1,105,666,596.01 1,807,747,803.43 702,081,207.42
IRAN 219,278,511.67 1,426,330,497.91 1,207,051,986.24
MYANMAR 7,240,756.49 1,769,418.32 -5,471,338.17
NEPAL 15,222,234.84 4,494,793.24 -10,727,441.60
PAKISTAN 347,147,780.03 176,086,064.25 -171,061,715.78
SRI LANKA 668,709,932.46 59,211,818.87 -609,498,113.59
TOTAL 3,553,665,818.66 3,553,665,818.66 + 1,910,112,317.73 - * Including Interest
ASIAN CLEARING UNION YEAR OF 2001
TRANSACTIONS MATRIX ( IN US DOLLARS ) TABLE(2)
Creditors BANGLADESH BHUTAN INDIA IRAN MYANMAR NEPAL PAKISTAN SRI LANKA TOTAL
Debtors
BANGLADESH 0.00 1,580,950.00 1,079,630,758.56 1,947,484.28 244,158.97 4,063,438.78 90,727,611.16 7,301,163.00 1,185,495,564.75 BHUTAN 605,000.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 605,000.00 INDIA 18,507,629.00 0.00 0.00 1,054,762,055.84 0.00 0.00 22,613,653.30 9,783,257.87 1,105,666,596.01 IRAN 32,897,078.02 0.00 169,843,156.25 0.00 0.00 0.00 4,485,853.28 12,052,424.12 219,278,511.67 MYANMAR 0.00 0.00 7,000,000.00 6,201.00 0.00 0.00 200,000.00 0.00 7,206,201.00 NEPAL 5,262,856.06 0.00 0.00 25,398.75 0.00 0.00 1,531,405.00 8,360,781.69 15,180,441.50 PAKISTAN 17,609,339.17 0.00 139,364,950.53 166,316,471.58 1,267,100.00 59,600.00 0.00 21,714,192.19 346,331,653.47 SRI LANKA 1,559,000.00 0.00 409,309,233.26 198,409,207.72 255,500.00 370,000.00 56,527,541.51 0.00 666,430,482.49
3,546,194,450.89
TOTAL 76,440,902.25 1,580,950.00 1,805,148,098.60 1,421,466,819.17 1,766,758.97 4,493,038.78 176,086,064.25 59,211,818.87 3,546,194,450.89
ASIAN CLEARING UNION * TRANSACTIONS CREDITED TO PARTICIPANT CENTRAL BANKS ( IN US DOLLARS )
TABLE (3)
1997 1998 1999 2000 2001 ______
BANGLADESH 113,241,526.08 119,442,796.21 88,256,302.89 81,011,695.55 76,440,902.25
BHUTAN 0.00 0.00 0.00 75,000.00 1,584,520.39
INDIA 1,480,255,361.49 1,875,577,424.84 1,613,969,592.41 1,599,372,949.68 1,807,747,803.43
IRAN 796,362,880.73 485,152,941.94 621,383,052.92 1,412,221,622.47 1,426,330,497.91
MYANMAR 7,977,970.39 8,039,340.86 4,802,804.07 2,340,165.88 1,769,418.32
NEPAL 15,769,581.58 15,862,505.42 10,339,779.46 4,856,719.15 4,494,793.24
PAKISTAN 155,767,476.35 244,695,812.28 201,137,423.50 197,291,952.27 176,086,064.25
SRI LANKA 85,577,481.67 93,998,770.68 90,851,617.85 86,365,136.72 59,211,818.87
TOTAL 2,654,952,278.29 2,842,769,592.23 2,630,740,573.10 3,383,535,241.72 3,553,665,818.66
* Including Interest
ASIAN CLEARING UNION * SHARE OF THE MEMBER CENTRAL BANKS IN TOTAL CREDIT TRANSACTIONS (PERCENTAGE )
TABLE (4)
1997 1998 1999 2000 2001 ______BANGLADESH 4 4 3 2 2
BHUTAN 0 0 0 0 0
INDIA 56 66 61 47 51
IRAN 30 17 24 42 40
MYANMAR 0 0 0 0 0
NEPAL 1 1 0 0 0
PAKISTAN 6 9 8 6 5
SRI LANKA 3 3 4 3 2
______TOTAL 100 100 100 100 100 ______
* Including Interest
ASIAN CLEARING UNION * ANNUAL GROWTH OF TRANSACTIONS CREDITED TO PARTICIPANT CENTRAL BANKS ( PERCENTAGE )
Table (5)
Bangladesh Bhutan India Iran Myanmar Nepal Pakistan Sri Lanka ACU ______
1997 21 0 -17 -15 -26 123 -31 -23 -16
1998 5 0 27 -39 1 1 57 10 7
1999 -26 0 -14 28 -40 -35 -18 -3 -7
2000 -8 0 -1 127 -51 -53 -2 -5 29
2001 -6 2,013 13 1 -24 -7 -11 -31 5
* Including Interest
ASIAN CLEARING UNION * TRANSACTIONS DEBITED TO PARTICIPANT CENTRAL BANKS ( IN US DOLLARS )
TABLE (6)
1997 1998 1999 2000 2001 ______
BANGLADESH 860,318,371.84 1,301,727,898.07 1,141,742,504.35 1,003,331,228.65 1,189,794,610.84
BHUTAN 0.00 0.00 0.00 110,740.79 605,396.32
INDIA 598,658,417.52 453,787,058.87 578,967,360.54 1,046,914,569.35 1,105,666,596.01
IRAN 290,603,871.43 252,054,244.80 173,575,481.71 217,136,482.85 219,278,511.67
MYANMAR 7,273.00 6,109.00 6,537.00 1,008,045.66 7,240,756.49
NEPAL 7,743,134.38 18,052,518.53 12,501,340.87 7,490,457.25 15,222,234.84
PAKISTAN 349,125,090.15 195,455,766.09 115,396,983.26 321,096,421.54 347,147,780.03
SRI LANKA 548,496,119.97 621,685,996.87 608,550,365.37 786,447,295.63 668,709,932.46
______TOTAL 2,654,952,278.29 2,842,769,592.23 2,630,740,573.10 3,383,535,241.72 3,553,665,818.66 ______
* Including Interest
ASIAN CLEARING UNION * SHARE OF THE MEMBER CENTRAL BANKS IN TOTAL DEBIT TRANSACTIONS (PERCENTAGE )
TABLE (7)
1997 1998 1999 2000 2001 ______
BANGLADESH 32 46 43 30 34
BHUTAN 0 0 0 0 0
INDIA 23 16 22 31 31
IRAN 11 9 7 6 6
MYANMAR 0 0 0 0 0
NEPAL 0 0 1 0 0
PAKISTAN 13 7 4 10 10
SRI LANKA 21 22 23 23 19
______TOTAL 100 100 100 100 100 ______
* Including Interest
ASIAN CLEARING UNION * ANNUAL GROWTH OF TRANSACTIONS DEBITED TO PARTICIPANT CENTRAL BANKS ( PERCENTAGE )
Table (8)
Bangladesh Bhutan India Iran Myanmar Nepal Pakistan Sri Lanka ACU ______
1997 -24 0 -14 -4 -100 58 -12 -11 -16
1998 51 0 -24 -13 -16 133 -44 13 7
1999 -12 0 28 -31 7 -31 -41 -2 -7
2000 -12 0 81 25 15,321 -40 178 29 29
2001 19 447 6 1 618 103 8 -15 5
* Including Interest
ASIAN CLEARING UNION * MONTHLY DISTRIBUTION OF TOTAL TRANSACTIONS CREADITED TO PARTICIPANT CENTRAL BANKS , 2001 TABLE (9) (IN US DOLLARS)
2001 Bangladesh Bhutan India Iran Myanmar Nepal Pakistan Sri Lanka Total ______
JANUARY 8,685,439.06 75,108.09 164,552,600.20 123,945,083.66 20,000.00 469,879.92 12,894,296.89 6,211,066.04 316,853,473.86
FEBRUARY 5,260,150.13 150,641.25 158,791,377.73 105,920,061.61 365,000.00 273,460.00 12,754,540.84 4,644,651.09 288,159,882.65
MARCH 7,013,179.02 10,156.36 163,433,213.72 135,359,728.20 45,000.00 22,000.00 13,290,342.44 8,010,333.97 327,183,953.71
APRIL 4,576,136.02 50,000.00 175,212,603.29 109,102,078.75 15,000.00 45,000.00 21,857,564.78 7,279,763.80 318,138,146.64
MAY 7,110,493.71 70,000.00 187,406,722.55 150,807,706.55 85,000.00 581,000.00 15,252,779.05 5,714,596.42 367,028,298.28
JUNE 7,443,990.64 0.00 155,110,890.86 112,354,846.63 756,089.23 987,776.00 18,393,451.63 7,015,500.02 302,062,545.01
JULY 4,431,424.47 85,062.25 154,396,019.40 169,682,443.37 15,371.45 837,724.00 12,654,291.81 4,779,219.24 346,881,555.99
AUGUST 8,812,326.73 74,141.71 135,063,469.59 167,106,263.57 65,623.44 571,339.51 13,641,111.06 5,453,966.11 330,788,241.72
SEPTEMBER 4,958,786.31 458,807.01 124,360,814.66 95,283,777.02 30,092.55 188,197.01 13,703,908.31 3,244,084.02 242,228,466.89
OCTOBER 5,368,877.53 260,458.52 127,982,956.90 100,544,864.68 50,138.14 250,816.80 15,116,401.76 2,740,471.90 252,314,986.23
NOVEMBER 8,166,084.16 50,192.31 140,213,317.72 78,419,729.08 280,501.60 123,850.00 12,941,889.09 2,415,254.61 242,610,818.57
DECEMBER 4,614,014.47 299,952.89 121,223,816.81 77,803,914.79 41,601.91 143,750.00 13,585,486.59 1,702,911.65 219,415,449.11
______
TOTAL 76,440,902.25 1,584,520.39 1,807,747,803.43 1,426,330,497.91 1,769,418.32 4,494,793.24 176,086,064.25 59,211,818.87 3,553,665,818.66
______
* Including Interest
ASIAN CLEARING UNION * MONTHLY DISTRIBUTION OF TOTAL TRANSACTIONS DEBITED TO PARTICIPANT CENTRAL BANKS, 2001 TABLE (10) (IN US DOLLARS)
2001 Bangladesh Bhutan India Iran Myanmar Nepal Pakistan Sri Lanka Total ______JANUARY 101,072,523.72 0.00 92,867,629.50 16,061,211.13 2,008,462.85 269,797.17 39,929,602.73 64,644,246.76 316,853,473.86
FEBRUARY 109,788,276.76 0.00 90,555,331.27 18,249,830.18 1,208,361.00 1,318,767.51 30,332,284.49 36,707,031.44 288,159,882.65
MARCH 103,408,436.51 10,000.00 99,867,621.16 13,762,885.68 1,526.02 2,787,276.70 45,793,735.49 61,552,472.15 327,183,953.71
APRIL 119,308,957.66 100,086.85 84,380,085.49 15,482,615.74 4,014,729.96 3,635,621.52 29,089,594.69 62,126,454.73 318,138,146.64
MAY 123,018,387.31 100,177.89 113,803,798.05 33,666,749.87 1,475.66 1,208,740.23 32,634,558.75 62,594,410.52 367,028,298.28
JUNE 106,459,368.05 110,131.58 79,851,800.41 19,254,372.57 0.00 966,496.77 40,682,112.47 54,738,263.16 302,062,545.01
JULY 108,138,935.39 0.00 135,758,665.77 15,843,141.28 6,201.00 843,407.66 37,164,309.58 49,126,895.31 346,881,555.99
AUGUST 99,457,651.60 110,000.00 128,030,681.49 17,338,512.78 0.00 375,938.06 19,990,710.47 65,484,747.32 330,788,241.72
SEPTEMBER 82,027,881.01 0.00 66,149,976.48 17,683,413.89 0.00 131,633.27 26,729,382.81 49,506,179.43 242,228,466.89
OCTOBER 84,799,943.21 75,000.00 86,950,942.72 18,655,635.22 0.00 189,550.53 9,515,787.33 52,128,127.22 252,314,986.23
NOVEMBER 84,496,701.79 80,000.00 68,366,622.67 13,354,849.71 0.00 2,432,590.63 13,651,719.21 60,228,334.56 242,610,818.57
DECEMBER 67,817,547.83 20,000.00 59,083,441.00 19,925,293.62 0.00 1,062,414.79 21,633,982.01 49,872,769.86 219,415,449.11
TOTAL 1,189,794,610.84 605,396.32 1,105,666,596.01 219,278,511.67 7,240,756.49 15,222,234.84 347,147,780.03 668,709,932.46 3,553,665,818.66
* Including Interest
ASIAN CLEARING UNION MONTHLY DISTRIBUTION OF ACCRUED INTEREST CREDITED TO PARTICIPANT CENTRAL BANKS, 2001 (IN US DOLLARS) TABLE (11)
2001 Bangladesh Bhutan India Iran Myanmar Nepal Pakistan Sri Lanka Total ______JANUARY 0.00 108.09 244,460.91 426,889.41 0.00 959.92 0.00 0.00 672,418.33
FEBRUARY 0.00 641.25 439,726.71 606,913.11 0.00 0.00 0.00 0.00 1,047,281.07
MARCH 0.00 156.36 296,947.86 406,618.89 0.00 0.00 0.00 0.00 703,723.11
APRIL 0.00 0.00 446,340.77 699,211.34 0.00 0.00 0.00 0.00 1,145,552.11
MAY 0.00 0.00 229,401.48 401,572.50 0.00 0.00 0.00 0.00 630,973.98
JUNE 0.00 0.00 340,724.42 525,621.27 1,089.23 0.00 0.00 0.00 867,434.92
JULY 0.00 62.25 65,772.24 363,219.44 371.45 0.00 0.00 0.00 429,425.38
AUGUST 0.00 141.71 73,353.41 671,839.05 123.44 339.51 0.00 0.00 745,797.12
SEPTEMBER 0.00 807.01 100,344.66 220,558.36 92.55 363.23 0.00 0.00 322,165.81
OCTOBER 0.00 1,258.52 146,523.72 275,173.37 138.14 91.80 0.00 0.00 423,185.55
NOVEMBER 0.00 192.31 36,933.85 107,942.22 342.63 0.00 0.00 0.00 145,411.01
DECEMBER 0.00 202.89 179,174.80 158,119.78 501.91 0.00 0.00 0.00 337,999.38
TOTAL 0.00 3,570.39 2,599,704.83 4,863,678.74 2,659.35 1,754.46 0.00 0.00 7,471,367.77
ASIAN CLEARING UNION MONTHLY DISTRIBUTION OF ACCRUED INTEREST DEBITED TO PARTICIPANT CENTRAL BANKS, 2001 (IN US DOLLARS) TABLE (12)
2001 Bangladesh Bhutan India Iran Myanmar Nepal Pakistan Sri Lanka Total ______
JANUARY 317,247.58 0.00 0.00 0.00 8,462.85 0.00 122,533.30 224,174.60 672,418.33
FEBRUARY 584,151.58 0.00 0.00 0.00 8,361.00 804.52 142,932.53 311,031.44 1,047,281.07
MARCH 441,669.03 0.00 0.00 0.00 1,526.02 9,093.11 73,459.20 177,975.75 703,723.11
APRIL 629,887.69 86.85 0.00 0.00 14,729.96 17,445.20 126,188.50 357,213.91 1,145,552.11
MAY 418,347.03 177.89 0.00 0.00 1,475.66 5,678.53 72,183.95 133,110.92 630,973.98
JUNE 532,931.32 131.58 0.00 0.00 0.00 2,783.41 80,815.68 250,772.93 867,434.92
JULY 245,319.48 0.00 0.00 0.00 0.00 75.78 47,488.35 136,541.77 429,425.38
AUGUST 445,197.80 0.00 0.00 0.00 0.00 0.00 87,922.97 212,676.35 745,797.12
SEPTEMBER 192,697.02 0.00 0.00 0.00 0.00 0.00 29,832.18 99,636.61 322,165.81
OCTOBER 245,079.20 0.00 0.00 0.00 0.00 0.00 21,863.76 156,242.59 423,185.55
NOVEMBER 62,256.05 0.00 0.00 0.00 0.00 1,209.88 2,761.76 79,183.32 145,411.01
DECEMBER 184,262.31 0.00 0.00 0.00 0.00 4,702.91 8,144.38 140,889.78 337,999.38
TOTAL 4,299,046.09 396.32 0.00 0.00 34,555.49 41,793.34 816,126.56 2,279,449.97 7,471,367.77
ASIAN CLEARING UNION
NET CREDITOR AND NET DEBTOR POSITIONS AT THE END OF EACH SETTLEMENT PERIOD (2001) * ( IN US DOLLARS ) TABLE (13)
NET CREDITORS NET DEBTORS
Country Feb Apr Jun Aug Oct Dec Total (1) Feb Apr Jun Aug Oct Dec Total (2) (1-2)
Bangladesh 0 0 0 0 0 0 0 196,915,211.29 211,128,079.13 214,923,271.01 194,352,835.79 156,500,160.38 139,534,150.99 1,113,353,708.59 - 1,113,353,708.59
Bhutan 225,749.34 0 0 49,203.96 644,265.53 250,145.20 1,169,364.03 0 49,930.49 140,309.47 0 0 0 190,239.96 + 979,124.07
India 139,921,017.16 154,398,110.36 148,862,014.95 25,670,141.73 99,242,852.36 133,987,070.86 702,081,207.42 0 0 0 0 0 0 0 + 702,081,207.42
Iran 195,554,103.96 215,216,305.53 210,241,430.74 303,607,052.88 159,489,592.59 122,943,500.54 1,207,051,986.24 0 0 0 0 0 0 0 + 1,207,051,986.24
Myanmar 0 0 839,613.57 74,793.89 80,230.69 322,103.51 1,316,741.66 2,831,823.85 3,956,255.98 0 0 0 0 6,788,079.83 - 5,471,338.17
Nepal 0 0 0 189,717.79 117,830.01 0 307,547.80 845,224.76 6,355,898.22 606,461.00 0 0 3,227,405.42 11,034,989.40 - 10,727,441.60
Pakistan 0 0 0 0 0 0 0 44,613,049.49 39,735,422.96 39,670,440.54 30,859,617.18 7,424,860.07 8,758,325.54 171,061,715.78 - 171,061,715.78
Sri Lanka 0 0 0 0 0 0 0 90,495,561.07 108,388,829.11 104,602,577.24 104,378,457.28 95,649,750.73 105,982,938.16 609,498,113.59 - 609,498,113.59
Total 335,700,870.46 369,614,415.89 359,943,059.26 329,590,910.25 259,574,771.18 257,502,820.11 1,911,926,847.15 335,700,870.46 369,614,415.89 359,943,059.26 329,590,910.25 259,574,771.18 257,502,820.11 1,911,926,847.15 + 1,910,112,317.73
* Including Interest