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Month: December 2019

  • Gwadar Port starts exports operation: Razak Dawood

    Gwadar Port starts exports operation: Razak Dawood

    KARACHI: Gwadar Port has become operational for exports as a vessel loaded with three containers of seafood left for Far Eastern ports, said adviser to prime minister.

    Abdul Razak Dawood, in his tweet on Saturday made this announcement about the exports through Gwadar Port.

    “Gawadar becomes operational for Exports! Seafood export, in reefer containers, using WeBOC system, started on 19 Nov 2019 through COSCO’s KGS service.”

    “The vessel loaded 3 containers of fish for Far Eastern ports.”

    The adviser said that average value of cargo was $50,000/container.

    This would reduce time taken for trading across borders and also reduce port congestion at Karachi.

    Gwadar is Pakistan’s largest infrastructural project since independence.

    After the completion of the first phase of Gwadar port, billions of dollars have been invested in Gwadar and in the next one or two years the investment can cross the figure of trillions.

    China is a major investor in Gwadar, and has spent $248 million in the first phase of Gwadar port, according to official website of Gwadar Port Authority.

  • Iranian delegation urges Pakistan for reducing customs duties for promoting formal trade

    Iranian delegation urges Pakistan for reducing customs duties for promoting formal trade

    KARACHI: Iranian trade delegation has urged Pakistani authorities to bring down customs duties in order to encourage formal trade between the two countries.

    Talking to the members of Karachi Chamber of Commerce and Industry (KCCI), Morad Nemati, leader of the Iranian delegation said that in order to improve the trade relations between Pakistan and Iran, it was really essential that steps have to be taken to deal with the barriers hindering smooth trade between the two brotherly countries while the high custom duties need to be brought down to encourage legal trade and discourage smuggling.

    Morad Nemati added that in addition to bringing down the high custom duties, formal banking channel between the two countries has to be activated which was widely being demanded by the business communities of the two countries since quite some time now.

    Commercial Attaché of the Iranian Consulate in Karachi Mahmoud Hajy Yousefi Pour, Vice President Shahid Ismail, Former Vice President Asif Sheikh Javaid, KCCI Managing Committee Members and members of the Iranian delegation from different sectors of the economy were also present on the occasion.

    While referring to China-Pakistan Economic Corridor (CPEC), Morad Nemati said that this essential project was going to open up huge opportunities not just for Pakistan but also for Iran and they (Iran) want to become part of this project which would surely ensure prosperity in the entire region.

    He also underscored that that the business communities of the two countries will have to meet more frequently and improve their contacts, besides holding Single Country Exhibitions which would certainly improve trade and investment in both the brotherly countries.

    Morad Nemati, who has also discharged his service as Commercial Attaché of the Iranian Consulate in Karachi, assured full support and cooperation to the business community so that trade could improve further and they collectively explore new avenues trade cooperation.

    Earlier, Vice President KCCI Shahid Ismail, while welcoming the Iranian delegation, stated that despite being brotherly countries, trade remains low hence, Pakistan and Iran must make collective efforts to explore new avenues. It has always been KCCI’s struggle to promote bilateral trade and the Chamber has a very positive approach towards improving trade ties particularly with neighboring countries.

    He pointed out that the bilateral trade between Pakistan and Iran was much less than the potential as Pakistan exports stood at a mere $330.2 million while the imports were around $1.247 billion during 2018.

    Shahid Ismail noted that the negotiations on Free Trade Agreement (FTA) are underway as both the countries have shared their desire of upgrading Preferential Trade Agreement (PTA) into Free Trade Agreement (FTA) for which initial drafts have already been shared while the State Bank of Pakistan has also shared draft of Memorandum of Understanding (MoU) for signing its Banking Paying Arrangement (BPA) with Iran’s Iranian Bank Markazi Jomhouri. Both countries have already signed MoU through which channels would be opened in the central banks of both the countries for trade transactions that would reduce the usage of dollar account for Letter of Credit (LC) clearance.

    He hoped that the desperately needed proper banking channel between Pakistan and Iran becomes a reality soon which would surely boost the existing trade ties.

    Shahid Ismail underscored the need to sort out infrastructural constraints to enhance bilateral trade via Quetta-Taftan land route whereas regular operation of ECO container train will lend impetus to cargo and transit facilities between the two countries. While underscoring the need for a realistic approach, Vice President KCCI said that KCCI was keen to strengthen trade ties with their counterparts in Iran.

  • Individuals falling under final tax not required to file annual returns

    Individuals falling under final tax not required to file annual returns

    KARACHI: Individuals or companies falling under final tax are not required to file annual income tax returns and their statement will be treated as assessment.

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  • SBP directs banks to ensure liquidity for rupee

    SBP directs banks to ensure liquidity for rupee

    KARACHI: The State Bank of Pakistan (SBP) has directed to ensure sufficient liquidity for settlement of rupee forward maturities.

    In a circular issued to all president and chief executives of the banks, the central bank issued instructions related to settlement of Pak Rupee forward maturities.

    The SBP said that as per existing practice, the Pak Rupee maturities in respect of forward leg of foreign exchange interbank contracts (PKR forward maturities) are settled on End-of-Day (EOD) basis.

    Apart from not being in line with international best practice, the EOD basis also carries associated risk of unjustified intraday float.

    “In view of above, it has been decided that PKR forward maturities would be settled on Start-of-Day (SOD) basis effective December 23, 2019 and onwards.”

    The banks shall ensure sufficient liquidity in their respective Pak Rupee accounts maintained with SBPBSC-Karachi Office on the settlement date of PKR forward maturities in order to avoid intraday liquidity shortages.

  • Weekly Review: stock market likely to maintain buoyancy

    Weekly Review: stock market likely to maintain buoyancy

    KARACHI: The stock market likely to maintain its buoyancy during next week owing to economic improvement.

    Analysts at Arif Habib Limited said that index will continue it’s upward journey as the economy depicts signs of resurrection.

    Improvement on the external front together with stability in the Pak Rupee is expected to reassure foreign investors.

    Meanwhile inflationary readings are set to touch peak in January 2020 and with an imminent interest rate cut to follow, domestic investors remain jubilant as well.

    The KSE-100 index of Pakistan Stock Exchange (PSX) is currently trading at a PER of 7.2x (2020) compared to Asia Pac regional average of 13.6x and while offering DY of ~7.8 percent versus ~2.6 percent offered by the region.

    The domestic equity bourse breached the 41,000 level this week (last seen in February 2019) albeit, settling at 40,917 points (up by 184 points and 0.45 percent WoW).

    This marks the highest index return in terms of percentage generated in seven consecutive weeks (+21.6 percent) in the past 10 years, last observed in September 2009.

    Although some profit-taking was witnessed throughout the week, a swift rally at the index on the last day reflects continued investor confidence on the back of improving macros (trade deficit narrowed by 33 percent during 5MFY20 and reserves held by the SBP jumped up to USD 9.23bn), and lower bond yields (under 11 percent for 10-year PIBs as per latest auction), which further opens up valuations.

    Sector-wise positive contributions came from i) Oil & Gas Exploration (273 points) as Pakistan invites Russia to acquire governments share in OGDC and PPL, ii) Chemical (54 points), iii) Food and personal care (47 points), iv) Fertilizer (42 points), and v) Tobacco (38 points). Scrip-wise positive contributions were led by OGDC (101 points), PPL (84 points), MARI (52 points), NESTLE (43 points) and POL (36 points).

    Foreign selling was witnessed this week clocking-in at USD 9.1 million compared to a net buy of USD 1.1 million last week. Selling was witnessed in E&P (USD 5.4 million) and Commercial Banks (USD 3.5 million).

    On the domestic front, major buying was reported by Individuals (USD 7.4 million) and Mutual Funds (USD 7.6 million). Average Volumes settled at 276 million shares (down by 41 percent WoW) while average value traded clocked-in at USD 67 million (down by 36 percent WoW).

  • PTBA suggests return filing date extension up to December 31

    PTBA suggests return filing date extension up to December 31

    LAHORE: The Pakistan Tax Bar Association (PTBA) has advised the Federal Board of Revenue (FBR) to extend the deadline for filing income tax returns to December 31, 2019. This recommendation was made in a letter addressed to the FBR chairman on Friday, citing several challenges faced by taxpayers and consultants.

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  • Stock market gains 402 points as buying seen in major scrips

    Stock market gains 402 points as buying seen in major scrips

    KARACHI: The stock exchange gained 402 points on Friday owing to buying seen in major blue chip scrips.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 40,917 points as against 40,514 points showing an increase of 402 points.

    Analysts at Arif Habib Limited said that the market opened on a positive note today and took cue from higher international oil prices that caused PPL to hit upper circuit and OGDC to trade near upper circuit.

    Buying activity was mainly observed in Oil & Gas chain. Besides E&P stocks, SSGC and SNGP among O&GMCs also closed on upper circuits.

    Autos, Cement and Steel were generally among the laggards. Banking sector led the volumes with 37.9 million shares, followed by Vanaspati (28.2 million) and Technology (27.3 million).

    Among scrips, UNITY led the volumes with 28.2 million shares followed by BOP (14.8 million) and FFL (13.5 million).

    Sectors contributing to the performance include E&P (+168 points), Banks (+77 points), O&GMCs (+55 points), Textile (+28 points), Inv Banks (+14 points).

    Volumes increased from 227 million shares to 270.7 million shares (+19 percent DoD).

    Average traded value also increased by 39 percent to reach US$ 75.3 million as against US$ 54.3 million.

    Stocks that contributed significantly to the volumes include UNITY, BOP, FFL, AVN and OGDC, which formed 30 percent of total volumes.

    Stocks that contributed positively include PPL (+92 points), OGDC (+77 points), HBL (+34 points), PSO (+26 points) and SNGP (+20 points). Stocks that contributed negatively include FFC (-9 points), THALL (-8 points), ENGRO (-8 points), MLCF (-6 points), and MARI (-5 points).

  • Rupee makes gain on inflows

    Rupee makes gain on inflows

    KARACHI: The Pak Rupee gained three paisas against dollar on Friday owing to inflows of export receipts and workers’ remittances.

    The rupee ended Rs154.96 to the dollar from previous day’s closing of Rs154.99 in interbank foreign exchange market.

    Currency experts said that inflows of exports and remittances helped the rupee to make gain. They said that improvement in foreign exchange reserves also helped the local unit to appreciate against the greenback.

    The foreign currency market was initiated in the range of Rs154.94 and Rs154.99. The market witnessed day high of Rs154.99 and low of Rs154.94 and closed at Rs154.96.

    The exchange rate in open market however witnessed no change in rupee value. The buying and selling of dollar was recorded at Rs154.40/Rs154.70, the same previous day’ closing, in cash ready market.

  • Will FBR extend return filing date or opt to collect surcharge

    Will FBR extend return filing date or opt to collect surcharge

    KARACHI: Federal Board of Revenue (FBR) has two options regarding income tax returns filing either to grant further extension or collect late filing surcharge, sources said on Friday.

    The last date for annual filing income tax for tax year 2019 is December 16, 2019. The date for filing income tax returns by salaried persons, business individuals, Association of Persons (AOPs) and companies having special financial year was September 30, 2019.

    However, the FBR granted first extension on September 30, 2019, second on October 31, 2019 and the third extension was granted on November 29, 2019.

    Normally the FBR extends the last date up to mid of December every year. However, for the tax year 2018 the date was extended up to August 09, 2019 due to various reasons including the amnesty scheme launched during the time period.

    The sources said that the FBR was eying to receive around 3.5 million income tax returns for tax year 2019 as it had received around 2.71 million returns for tax year 2018.

    According to a letter of Pakistan Tax Bar Association (PTBA) the total return filing by November 26, 2019 for tax year 2019 was 1.6 million. So it is unlikely the FBR get around one million returns by December 16, 2019. If FBR eyes 3.5 million returns for tax year 2019 then the required number will be 1.8 million returns to be filed during the last extension or 16 days from December 01, 2019 to December 16, 2019.

    The sources said that the after the introduction of Tenth Schedule to Income Tax Ordinance, 2001 the return filing had become very important and under the new schedule a person was required to pay 100 percent more withholding tax in case his name was not on the ATL.

    Besides, the FBR also introduced slabs of late filing surcharges for individuals, AOPs and companies. The sources said that in case date was not extended beyond December 16, 2019 then return filers would required to pay late surcharge in order to ensure their name on the ATL.

    Some sources believed that the FBR would extend the date for filing income tax returns for tax year 2019 as large segment of retailers and small business were required to file their returns and the FBR was working on a mechanism to resolve the issue with retailers and small traders.

    The sources said that in case return filing date is given to this segment then FBR would grant general extension to all the persons to file their returns.

  • IMF board to meet on December 19 to review Pakistan program

    IMF board to meet on December 19 to review Pakistan program

    KARACHI: The board of International Monetary Fund (IMF) will meet on December 19, 2019 to review Pakistan’s loan program and consider releasing next tranche.

    Gerry Rice, Director Communication, IMF in a press briefing on Thursday said that the IMF had a $6 billion program to support IMF’s economic reforms.

    “We had a mission there in November and the communication around that with a preliminary assessment of where we think Pakistan stands.”

    Which is that the program is on track and we reached a staff-level agreement on what we call the first review. You can read about that in more detail on our website.

    We had the preliminary assessment from staff after that mission to Pakistan and the board will meet to discuss that first review on Thursday, December 19th.

    What that indicates is that all prior actions and performance criteria under the program with Pakistan have been met. And that the financing assurances needed for the program to go forward are in place.