Pkrevenue.com

Category: Finance

Explore finance-related stories with Pakistan Revenue, your source for the latest updates on Pakistan’s economy, financial trends, and market insights. Stay informed with real-time economic developments.

  • Foreign exchange reserves ease to $20.058 billion

    Foreign exchange reserves ease to $20.058 billion

    KARACHI: The country’s foreign exchange reserves eased by $15 million to $20.058 billion by week ended February 12, 2021, State Bank of Pakistan (SBP) said on Thursday.

    The foreign exchange reserves of the country were at $20.073 billion by week ended February 04, 2021.

    The official foreign exchange reserves of the central bank fell by $60 million to $12.889 billion by week ended February 12, 2021 as compared with $12.949 billion a week ago.

    However, foreign exchange reserves held by the commercial banks increased by $45 million to $7.169 billion by week ended February 12, 2021 as compared with $7.124 billion a week ago.

  • IMF projects Pakistan’s economic expansion by 1.5pc in current fiscal

    IMF projects Pakistan’s economic expansion by 1.5pc in current fiscal

    ISLAMABAD: The International Monetary Fund (IMF) has projected Pakistan’s economic expansion by 1.5 percent during the current fiscal year 2020/2021 while praising efforts of Pakistani authorities in taking measures amid coronavirus pandemic.

    The economic during the last fiscal year recorded negative growth of 0.4 percent.

    This was noticed by the IMF while reaching staff level agreement with Pakistani authorities.

    The IMF issued a press release on Tuesday after reaching on a package of measures to complete second to fifth reviews of the authorities’ reform program supported by the IMF Extended Fund Facility (EFF).

    The package strikes an appropriate balance between supporting the economy, ensuring debt sustainability, and advancing structural reform. Pending approval of the Executive Board, the reviews’ completion would release around $500 million.

    The IMF noted that the COVID-19 shock temporarily disrupted Pakistan’s progress under the EFF-supported program. However, the authorities’ policies and allowing higher than expected COVID-related social spending, have been critical in supporting the economy and saving lives and households.

    It further noted that the Pakistani authorities remain committed to ambitious policy actions and structural reforms to strengthen economic resilience, advance sustainable growth, and achieve the EFF’s medium-term objectives.

    An International Monetary Fund (IMF) team led by Ernesto Ramirez Rigo, concluded virtual discussions with the Pakistani authorities and reached a staff-level agreement on the second to fifth reviews of the authorities’ reform program supported by the IMF 39-month Extended Fund Facility (EFF) arrangement for the amount of SDR 4,268 million (about US$6 billion).

    This agreement is subject to the approval of the IMF’s Executive Board. The reviews’ completion would release around US$500 million.

    At the end of the discussions, Ramirez Rigo issued the following statement:

    “The policies and reforms implemented by the Pakistani authorities prior to the COVID-19 shock had started to reduce economic imbalances and set the conditions for improving economic performance. Most of the targets under the EFF-supported program were on track to be met. However, the pandemic disrupted these improvements and required a shift in authorities’ priorities towards saving lives and supporting households and businesses. To a large extent, the authorities’ response was enabled by the fiscal and monetary policy gains attained in the first nine months of FY2020. Aside from health containment measures, this included a temporary fiscal stimulus, a large expansion of the social safety net, monetary policy support and targeted financial initiatives. These were supported by sizeable emergency financing from the international community, including from the Fund’s Rapid Financing Instrument (RFI).

    “As result of the authorities’ actions, the COVID-19 first wave started to abate over the 2020 summer and the impact on the economy was significantly reduced. The external current account improved, due to stronger-than-expected remittances, import compression, and a mild export recovery. High-frequency economic data also started to point to a recovery. Considering these improvements, the economy is projected to expand by 1.5 percent in FY2021 from the -0.4 percent in FY2020. Still, with the COVID-19 second wave still unfolding around the world, the outlook is subject to a high level of uncertainty and downside risks.

    “The Covid-19 shock has required a careful recalibration of the macroeconomic policy mix, the reforms calendar, and the EFF review schedule. Against this background, the authorities have formulated a package of measures that strikes an appropriate balance between supporting the economy, ensuring debt sustainability, and advancing structural reforms. The fiscal strategy remains anchored by the sustainable primary deficit of FY2021 budget and allows for higher-than-expected COVID-related and social spending to minimize the short-term impact on growth and the most vulnerable. The targets are supported by careful spending management and revenue measures, including reforms of corporate taxation to make it fairer and more transparent. The power sector’s strategy aims at financial viability, through management improvements, cost reductions, and adjustments in tariffs and subsidies calibrated to attenuate social and sectoral impacts.  

    “The State Bank of Pakistan (SBP)’s monetary and exchange rate policies have served Pakistan well and were critical in helping to navigate the COVID-19 shock. The strengthened international reserves’ position since the start of the program—with gross reserves almost doubling to USD 13 billion until January 2021 and net international reserves (NIR) increasing by over USD 9 billion until December 2020—and the shock absorption displayed by the market-based exchange rate, allowed the SBP’s to pre-emptively proceed to a large easing of monetary policy, and a sizeable expansion of refinancing facilities. The banking system remains healthy, but it will be important for the SBP to continue to remain vigilant and prevent possible financial stability stress as the temporary support is phased out. International reserves are set to improve further reflecting current account developments, the EFF resumption, and international partners’ support. 

    “The authorities are moving steadfastly on a number of other important reforms, including on strengthening regulatory agencies’ legal frameworks (NEPRA and OGRA Acts), consolidating SBP’s autonomy (SBP Act), and improving state owned enterprises (SOE) management (SOE Law). In addition, they have conducted a triage of SOE, and are moving forward with the audits of contracts awarded for COVID-19 related spending. They continue to enhance the effectiveness of their anti-monetary laundering/counter financing of terrorism (AML/CFT) framework and progress in completing their action plan with the Financial Action Task Force (FATF).”

  • Weekly foreign exchange reserves slip by $90 million

    Weekly foreign exchange reserves slip by $90 million

    KARACHI: Foreign exchange reserves position eased by $90 million to $20.073 billion by week ended February 04, 2021, State Bank of Pakistan (SBP) said on Thursday.

    The foreign exchange reserves of the country were at $20.163 billion by week ended January 29, 2021.

    The official foreign exchange reserves of the central bank also fell by $82 million to $12.949 billion by week ended February 04, 2021 as compared with $13.031 billion a week ago.

    Similarly, the foreign exchange reserves held by commercial banks witnessed decline by $8 million to $7.124 billion by week ended February 04, 2021 as compared with $7.132 billion a week ago.

  • Prime Minister issues directives for reducing burden of indirect taxes

    Prime Minister issues directives for reducing burden of indirect taxes

    ISLAMABAD: The government has started easing burden of indirect taxes to provide relief to the masses. In this regard Prime Minister Imran Khan has issued instructions to relevant ministries for preparing proposals.

    Meeting of the Federal Cabinet was chaired by Prime Minister Imran Khan at Islamabad on Tuesday.

    The Prime Minister apprised the meeting that relevant ministries have been directed to present proposals for reducing the burden of indirect taxes, particularly on food items in order to provide relief to the masses.

    The federal cabinet approved Tax Laws (Amendment) Ordinance 2021. These amendments are aimed at facilitating transaction under Digital Roshan Pakistan scheme.

    It was apprised that $ 500 million have been transacted through Digital Roshan Pakistan scheme so far.

    The Cabinet accorded approval for 3 months extension of Afghanistan-Pakistan Transit Trade Agreement (APTTA 2010). The existing agreement is due to expire on 11th February, 2021.

    The Cabinet was also briefed about the measures taken to control smuggling at Pak-Iran and Pak-Afghanistan borders.

    The Cabinet expressed serious concerns over the report, according to which Sindh Government released 32,000 tons of wheat that was a 6 years old stock and unfit for human consumption.

    The Cabinet noted that Sindh did not release wheat timely for public need and did not share Wheat and Sugar stock position with the Federal Government which resulted in artificial price hike and issues of hoarding, on one hand, and wastage of available wheat stock that could have been utilized for public good.

    The Cabinet was apprised about the updated status of actions taken pursuant to Sugar Enquiry Committee Report. It was informed that several sugar mills had approached courts of law and action is underway after completion of court proceedings. The Cabinet was also informed that NAB was looking into the issue of subsidies.

    Chairman, Task Force on IT & Telecom briefed the Cabinet about progress made for development of IT and Telecom sector.

    The Cabinet was updated on Vacant Positions of Heads / CEOs of Public Sector Organizations. It was informed that since 2018, 56 Heads / CEOs have been appointed to Public Sector Organizations in a merit based and transparent manner.

    The meeting was informed that at present 86 posts of heads/CEOs were vacant. The Prime Minister expressed displeasure over the vacant positions and directed Secretary Establishment Division to furnish a report before the Cabinet citing reasons for delay in appointments.

    The Cabinet was apprised about Metro Bus Project, Islamabad. Chairman NHA informed that infrastructure work has been completed and the project is ready to be handed over to CDA. Minister for Interior was tasked by the Cabinet to present a road-map for handing-over of the project from NHA to CDA and operationalization plan.

    The Cabinet accorded approval for Mutual Legal Assistance requests from Non-Treaty Countries.

    The Cabinet approved appointment of Chief Metropolitan Officer as Administrator, Metropolitan Corporation, Islamabad for 6 months or till the time new Local Government setup is in place, whichever is earlier.

    The Cabinet approved establishment of 30 Additional Accountability Courts in implementation of Hon. Supreme Court’s orders. These courts are to be established in Karachi, Lahore, Multan, Peshawar, Rawalpindi, Sukkur, Hyderabad and Quetta. The Prime Minister directed that first phase of establishment be completed on priority.

    The Cabinet approved appointment of Masroor Khan as Chairman, Oil & Gas Regulatory Authority (OGRA).

    Cabinet ratified decisions taken in Economic Coordination Committee (ECC) meeting held on 3rd & 8th February, 2021; and Cabinet Committee on Energy meeting held on 4th & 8th February, 2021.

    The Cabinet was briefed on negotiations held with Independent Power Producers (IPPs). It was informed that the Government will benefit to the tune of Rs. 800 billion over a period of 20 years. It was apprised that the present Government is clearing a liability of approx. Rs. 400 billion after pre-audit. The Cabinet was apprised that a high level committee has been established comprising of two Hon. Supreme Court Judges and the Auditor to decide on the disputed amount of Rs. 57 billion claimed by IPPs. The Cabinet was informed that as a result of negotiations, the Government saved Rs. 32 billion against an adjudicated claim of Rs. 92 billion by IPPs. It was clarified that the Government has not surrendered any of its rights in the negotiations process. The Cabinet was informed that this process will result in a direct benefit of reduction in energy prices for the consumers. The Cabinet appreciated efforts of the Negotiations Committee.

     The Prime Minister directed that unscheduled load shedding should not be practiced in any part of the country and directed Minister for Energy to conduct in-depth investigations for load-shedding occurring due to technical reasons.

    The Cabinet accorded approval for exemption of PPRA regulations for import of 300,000 tons Wheat and 500,000 sugar.

  • SECP’s total company registration increases to 134,797

    SECP’s total company registration increases to 134,797

    ISLAMABAD – The company registration by the Securities and Exchange Commission of Pakistan (SECP) recorded a significant milestone in January 2021 with the registration of 2,201 new companies, bringing the total number of registered entities in the country to 134,797, according to an official statement released on Monday.

    (more…)
  • Sugar mills monitoring: ECC approves Rs350 million for VAS purchase

    Sugar mills monitoring: ECC approves Rs350 million for VAS purchase

    ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Monday approved Rs350 million for procurement of Video Analytics System (VAS) to monitor production of sugar mills.

    Federal Minister for Finance and Revenue, Dr. Abdul Hafeez Shaikh, chaired the meeting of the ECC.

    The Federal Board of Revenue (FBR) presented a summary regarding procurement of VAS for proper monitoring of the production and sale of sugar in compliance with the directive of the prime minister.

    “The ECC approved an allocation of Rs350 million as a Technical Supplementary Grant for installation of the most optimal VAS solution at the sugar mills’ premises during the current crushing season as requested by the FBR,” a statement said.

    Federal Minister for Planning, Development and Special Initiatives Asad Umar, Federal Minister for Energy Omar Ayub Khan, Adviser to the PM on Institutional Reforms and Austerity Dr. Ishrat Hussain, SAPM on Revenue Dr. Waqar Masood, SAPM on Power Tabish Gauhar, Governor State Bank Reza Baqir, Chairman FBR and Chairman Board of Investment participated in the meeting.

    Secretary, Ministry of Energy briefed the ECC about the detailed report by the Implementation Committee regarding conversion of MOUs into Agreements with IPPs to devise a payment mechanism for clearing outstanding payables.

     The Implementation Committee has agreed the payment mechanism with the 46 IPPs to clear the outstanding dues as on 30th November, 2020.

    The ECC commended the efforts made by the Implementation Committee and acknowledged the input of all concerned including Federal Minister for Energy, Federal Minister for Planning, SAPM on Power, Finance Division, Chairman Federal Land Commission, SAPM on Revenue, Governor SBP etc in working out a viable payment mechanism with the IPPs which will eventually save approximately Rs836 billion for the government over the average life of the projects.

    The ECC approved the report of the Implementation Committee with a direction to present the same before Cabinet for final approval.

  • Pakistan’s trade deficit widens by 8.27 percent to $14.96 billion in July – January

    Pakistan’s trade deficit widens by 8.27 percent to $14.96 billion in July – January

    ISLAMABAD: Pakistan’s trade deficit has surged by 8.27 percent to $14.96 billion during the first seven months (July – January) of the 2020/2021 fiscal year, propelled by an uptick in import bills following improved economic activities.

    (more…)
  • Exports cross $2 billion for four consecutive months in eight years

    Exports cross $2 billion for four consecutive months in eight years

    ISLAMABAD: Pakistan’s exports have crossed over $2 billion for the fourth consecutive months in January 2021 for the first time in last eight years, a statement said on Friday.

    A consultative meeting was held by the Advisor to Prime Minister on Commerce and Investment, Abdul Razaq Dawood, via video link to review the provisional trade data till the month of January 2021.

    He was informed that exports in January 2021 have increased by 8 percent to USD 2,135 million as compared to USD 1,978 million in January 2020.

    He was informed that this is the first time in last eight years that exports have crossed the $ 2 billion mark for four consecutive months.

    He was briefed that in January 2021, an increasing trend has been witnessed in the export of value-added and non-traditional products.

    The exports of Jerseys & Cardigans increased by 72 percent, Pharmaceutical by 55 percent, T-shirts by 43 percent, Plastics by 24 percent, Women’s Garments by 21 percent, Home Textiles by 19 percent, Textile Made-up by 11 percent, Men’s Garments by 8 percent and Rice by 7 percent as compared to January 2020.

    He was also informed that decreasing trend was noted in export of mostly non-value-added products.

    The exports of Maize decreased by 82 percent, Raw Leather by 23 percent, Cotton yarn by 11 percent, Cotton Fabric by 14 percent and Meat by 5 percent as compared to January 2020.

     The meeting was informed that geographically, in January 2021 exports increased to Canada (43 percent), Australia (42 percent), the United States (36 percent), South Africa (27 percent), China (21 percent), the United Kingdom (21 percent), Belgium (18 percent), and Saudi Arabia (14 percent).

    However, there was decrease in exports to Jordan (-68 percent), Senegal (-59 percent), Italy (-24 percent), Turkey (-21 percent), Bangladesh and the United Arab Emirates (-19 percent each).

    The 7-months’ performance of exports was also discussed in the meeting.

    The advisor was informed that the provisional export data for the period July-January 2020-21 showed that the exports increased by 5.5 percent, to USD 14,245 million as compared to USD 13,507 million during the same period last year.

    During July-January 2020-21, the exports of value-added and non-traditional products increased especially for Tents & Canvas (49 percent), Jerseys & Cardigans (37 percent), Pharmaceuticals (28 percent), Cutlery (27 percent), Socks & Stockings (26 percent), Women’s Garments (22 percent), Home Textiles (17 percent) and Textile Made-ups (9 percent) as compared to the same period last year.

    He was informed that as compared to the same period in the previous year, during July-January 2020-21 the export decrease was observed in mostly non-value added products, such as Cotton (-96 percent), Maize (-49 percent), Raw Leather (-30 percent), Cotton yarn (-24 percent) and Cotton Fabric (-9 percent).

    Dawood was informed that on the basis of export growth Pakistan’s Top markets for 7-months’ period are Indonesia (43 percent), Australia (22 percent), the United States (21 percent), the United Kingdom (21 percent), Poland (14 percent), Germany (12 percent), the Netherlands (11 percent) and China (9 percent).

    He was further informed that compared to last year, the markets showing declining exports during July-January 2020-21 were Thailand (-43 percent), Malaysia (-24 percent), Sri Lanka (-23 percent), the United Arab Emirates (-21 percent), Bangladesh (-18 percent), Italy (-7 percent) and Spain (-5 percent).

    Dawood advised the officials of the commerce ministry that much more needs to be done. He paid rich tributes to Pakistan’s exporters for this performance during difficult times despite the COVID-19 pandemic and contraction in Pakistan’s major markets. He urged them to aggressively focus on capturing a larger share of international exports.

  • Pakistan’s foreign exchange reserves increase to $20.163 billion

    Pakistan’s foreign exchange reserves increase to $20.163 billion

    KARACHI: Pakistan’s total liquid foreign exchange reserves have increased by $57 million to $20.163 billion by week ended January 29, 2021, State Bank of Pakistan (SBP) said on Thursday.

    The foreign exchange reserves of the country were at $20.106 billion by week ended January 22, 2021.

    The official reserves of the State Bank increased by $33 million to $13.031 billion by week ended January 29, 2021 as compared with $20.106 billion a week ago.

    The foreign exchange reserves held by commercial banks also increased by $24 million to $7.132 billion by week ended January 29, 2021 as compared with $7.108 billion a week ago.

  • Meeting decides speeding up installing video monitoring cameras at sugar mills

    Meeting decides speeding up installing video monitoring cameras at sugar mills

    ISLAMABAD: A high level meeting chaired by Prime Minister Imran Khan on Wednesday decided to speed up the process of installing video monitoring cameras at sugar mills to ensure transparency in production and supply.

    The prime minister was presiding over weekly review meeting regarding the availability and prices of basic commodities across the country.

    The meeting was briefed about the various measures taken in the light of Sugar Inquiry Report to keep the price of sugar under control. It was decided that the process of installation of cameras in sugar mills would be quickened.

    Besides, the Federal Board of Revenue (FBR) will provide the provincial governments with details of sales tax collected in the head of sugar so as to make the system transparent.

    The meeting was told that owing to the effective measures taken by FBR, the collection of sales tax from sugar had recorded 84 percent increase during July-January period of the current fiscal year.

    Prime Minister Imran Khan said that besides making the availability of basic commodities certain, ensuring appropriate prices was foremost priority of the government.

    He directed the administration of Utility Stores Corporation (USC) to ensure the ample availability of basic goods at all outlets.

    The meeting was attended by the relevant Federal and Provincial Ministers, Secretaries, Chief Secretaries and other senior officers.

    The prime minister directed the Ministry of National Food Security to complete at the earliest the assessment work regarding the future requirement of basic commodities like wheat and sugar so as to ensure advance arrangements in that regard.

    He directed all the chief secretaries to ensure the implementation of price list through active and effective role of the administration.

    The prime minister ordered to ensure immediate action against the officers committing any negligence in that respect.

    Minister for Finance Dr Hafeez Sheikh told the meeting that in the month of January 2021, the Consumer Price Index (CPI) was recorded at 5.7 percent as against 14.6 percent recorded in the corresponding month of previous fiscal year.

    Similarly, the CPI recorded at 8.2 percent during July-January period of the current fiscal was also lower when compared with 11.2 percent recorded during the same period of last fiscal, he added.

    The meeting was told that the comparison based on the latest statistics depicted significant decline in CPI.

    It was further told that the prices of sugar, eggs, onion etc. have recorded decline whereas the price of wheat flour had shown stability.

    The meeting was also briefed about the situation of official release of wheat along with the details of price differential at whole sale and retail levels in various districts.

    It was told that price differential at whole sale and retail levels depicted the failure of market committees.

    The meeting decided to immediately abolish the existing market committees in the two provinces ruled by Pakistan Tehrik-e-Insaf (PTI) and hand over the responsibilities to District and Tehsil administrations till the constitution of new committees comprising competent people through a transparent process.

    It was decided that in case of non-implementation of price list, action would be taken against the relevant Assistant Commissioner.