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  • Imran Khan appreciates World Bank’s financial, technical support to Pakistan

    Imran Khan appreciates World Bank’s financial, technical support to Pakistan

    ISLAMABAD: Prime Minister Imran Khan has appreciated the World Bank’s financial and technical support to Pakistan.

    He said this while welcoming World Bank Group President David R. Malpass here on Thursday.
    The prime minister reiterated the government’s resolve towards strengthening of economy, ensuring transparency and good governance, institutional reforms, tax reforms and socio-economic development of the marginalized sections of society.

    He said that ease-of-doing business, enhancing tax base, domestic resource mobilization, attracting foreign investment and financial reforms agenda s the foremost priority of the government.

    Prime Minister Khan apprised that the government has launched various initiatives aimed at welfare of the youth, poverty alleviation and housing sectors that will ultimately result in economic development.

    President World Bank was accompanied by Regional VP South Asia Hartwig Schafer, Ms. Ceyla Pazarbasioglu-Dutz, Regional Vice President IFC Ms. Snezana Stolijkovic and Country Director World Bank Pakistan Patchamuthu Illangovan.

    The Pakistani side comprised of Minister for Economic Affairs Muhammad Hammad Azhar, Minister Planning Makhdoom Khusro Bakhtiar, Minister Water Resources Faisal Vawda, Advisor on Finance Dr. Abdul Hafeez Sheikh, Advisor on Institutional Reforms Dr. Ishrat Hussain, SAPM Dr. Firdous Ashiq Awan, SAPM Dr. Sania Nishtar, Governor State Bank Raza Baqir, Chairman FBR Syed Shabbar Zaidi and senior officers.

    President World Bank Group, David Malpass appreciated Prime Minister Imran Khan for personally spearheading various flagship programs of the government. He also recognized the efforts of the government towards economic turn-around, reducing expenditures, practicing austerity and initiating reforms in critical sectors of the economy.

    He said that there was substantial progress in economic indicators despite Global and internal fiscal challenges.

    Later, a round-table conference was also held wherein detailed discussions were held on issues related to energy sector and reforming tax regime of the country. Minister for Economic Affairs Hammad Azhar, in his opening remarks, highlighted overall reform agenda of the government and the efforts being made for economic turn-around.

    Advisor Finance Dr. Abdul Hafeez Sheikh gave an overview of the achievements made by the Government during last one year. He also underlined the efforts made by the government to stabilize the economy and to put it onto the path of growth.

    He said that there was a considerable progress this year on exports, containing fiscal and current account deficits, revenue collection, restricting expenditures and exchange rate stabilization.

    Minister for Power Omar Ayub Khan and SAPM on Energy Nadeem Babar shared the strategy of the Government to overcome the issues related to energy sector including circular debt and efforts being made to diversify energy-mix with greater reliance on alternate and renewable energy resources.

    The World Bank President David R. Malpass also visited Tarbela Dam Project on Thursday and had a round of the Main Dam and the Power House of Tarbela 4th Extension Hydropower Project.

    Water Resources Federal Minister Muhammad Faisal Vawda, Water Resources Federal Secretary Muhammad Ashraf, WAPDA Chairman Lt Gen Muzammil Hussain (Retd) and World Bank senior officials accompanied him during the visit.

    Speaking on the occasion, World Bank President David R. Malpass expressed his pleasure over completion of Tarbela 4th Extension Hydropower Project within time and less than estimated cost, adding that the work on the project is impressive.

    The efforts of Government of Pakistan particularly Ministry of Water Resources and the Minister Faisal Vawda for improvement of water resources in Pakistan are applauded.

    President World Bank appreciated the efforts of Ministry of Water Resources especially the Minister for resolving the issues in relation to completion of Dassu Hydral Power Project, construction of Dams and other related projects.

    The team of World Bank especially recognized the untiring efforts of Faisal Wadda, Minister for water Resources for effectively coping with the challenges related to water issues in Pakistan.

    Earlier, Water Resources Federal Minister Muhammad Faisal Vawda thanked the World Bank for the cooperation it has been providing to Pakistan for harnessing water and hydropower resources since 1960.He expressed the hope that this cooperation will further enhance for implementation of various projects in the days to come.

    Vawda said we are taking comprehensive and effective measures for improvement of water resources and construction of dams in Pakistan.

    Pakistan will witness more progress in hydropower and water sectors with cooperation of Water Bank in future. Faisal Vawda, Federal Minister for Water Resources further added.

    He said 523 billion units of electricity have been contributed by Tarbela Hydel Power Station to the National Grid. Welcoming the World Bank President at Tarbela, WAPDA Chairman Lt Gen Muzammil Hussain (Retd) commended that the World Bank not only helped broker Indus Water Treaty between Pakistan and India but also administered the entire financial arrangements with assistance of the friendly countries to complete Indus Basin Replacement Works, which included two mega dams namely Mangla and Tarbela, five barrages and nine inter-river link canals to divert water from the Western Rivers to the Eastern Rivers.

    He also appreciated the World Bank for financial support for Tarbela 4th Extension Hydropower Project, Dasu Hydropower Project and upcoming Tarbela 5th Extension Hydropower Project. WAPDA is looking forward to World Bank’s support for other projects, located on Indus Cascade.

    The projects on Indus Cascade have the great potential to store water and generate phenomenal hydel electricity, he further said. Briefing the World Bank President about the benefits of Tarbela Dam Project, the Chairman said that as many as 378 MAF water has been released from Tarbela Reservoir to meet irrigation needs of the country.

    In addition, Tarbela 4th Extension Hydropower Project, commissioned last year, has also generated 5.6 billion units – more than the generation envisaged in PC-I of the project.

  • Petrol, high speed diesel prices increased for November

    Petrol, high speed diesel prices increased for November

    ISLAMABAD: The government on Thursday increased the prices of petrol and high speed diesel on sales to end consumers.

    The price of motor spirit (petrol) has been increased by Re 1 to Rs114.24 with effective from November 01, 2019 as compared with Rs113.24 applicable during October 2019.

    Similarly prices of high speed diesel increased by 27 paisas to Rs127.41 from Rs127.14.

    However, prices of light diesel oil and kerosene oil have been reduced for the month of November 2019.

    The price of light diesel oil has been reduced by Rs6.56 to Rs85.33 from Rs91.89. Similarly price of kerosene oil has been reduced by Rs2.39 to Rs97.18 from Rs99.57.

    The government has decreased the prices of Kerosene and light diesel oil and slightly readjusted the prices of other petroleum products for the month of November 2019 as per recommendation of the Oil & Gas Regulatory Authority (OGRA), says a statement by the Ministry of Finance.

  • Pakistan’s forex weekly reserves decrease

    Pakistan’s forex weekly reserves decrease

    KARACHI: Pakistan’s total liquid foreign exchange reserves decrease by $96 million to $15.089 billion by week ended October 25, 2019 as compared with $15.186 billion a week ago, State Bank of Pakistan (SBP) said on Thursday.

    The reserves held by the SBP increased by $22 million to $7.914 billion by week ended October 25, 2019 as compared with $7.892 billion a week ago.

    The reserves held by commercial banks, however, fell by 118 million to $7.175 billion by week ended October 25, 2019 as compared with $7.293 billion a week ago.

  • World Bank Group President arrives for three-day visit

    World Bank Group President arrives for three-day visit

    ISLAMABAD: David Malpass, President of World Bank Group will arrive in Islamabad today Wednesday, October 30, 2019 for a three-day visit, his first trip to Pakistan since assuming World Bank Group leadership on April 9, 2019.

    While in Pakistan, Malpass will meet with Prime Minister Imran Khan.

    He will also meet the Chief Minister of Sindh, Federal and Provincial Ministers, Advisors, the State Bank Governor, members of Parliament, beneficiaries of the Benazir Income Support Program, and representatives of the private sector.

    “My visit to Pakistan provides a good opportunity to discuss the need for important reforms to stabilize the Pakistani economy and accelerate broad-based growth,” said Malpass.

    “I look forward to hearing from Prime Minister Imran Khan and the Chief Ministers on their priorities and how the World Bank Group can best work with Pakistan to improve its business and jobs environment, and create conditions for people to gain education, skills, and good health.”

    During his visit, President Malpass will engage on reforms, including harmonizing the sales tax across Pakistan to further improve the business environment and enhance revenue collection; lowering circular debt in the power sector and increasing the share of renewable energy for environmental sustainability; harnessing a greater role for women in the economy; and unleashing digital payments to boost financial inclusion.

    President Malpass will visit a World Bank-supported hydropower project in Tarbela, where the Bank is currently financing additional capacity of 4GW of cheaper and environment-friendly energy.

    President Malpass will participate in an event to celebrate Pakistan’s progress in Ease of Doing Business 2020, and to discuss useful next steps.

    He will also participate in the launch of the National Payments Systems Strategy with the government and representatives from the private sector.

    Pakistan has been a member of the World Bank since 1950. Since then, the World Bank has provided $40 billion in assistance.

    The World Bank’s program in Pakistan is governed by the Country Partnership Strategy for FY2015-2020 with four priority areas of engagement: energy, private sector development, inclusion, and service delivery.

  • SBP forecasts subdued growth with high inflation

    SBP forecasts subdued growth with high inflation

    KARACHI: State Bank of Pakistan (SBP) on Monday forecast subdued GDP growth with high inflation for the current fiscal year.

    The central bank in its Annual Report 2018/2019 (State of the Economy), said that macroeconomic stabilization will continue to be the cornerstone of economic policies during 2019/2020.

    Real GDP growth is likely to remain subdued, though the early signs of recovery are already visible. Development spending may play a pivotal role, since there has been an observed tendency that Pakistan’s GDP growth and PSDP spending move in the same direction, and similar has been the case in 2018/2019.

    On this note, it is worth highlighting that the government has budgeted a greater outlay for PSDP during the year compared to the actual spending in FY19.

    Other triggers may include an improvement in market sentiments vis-à-vis the IMF program. A better showing by the agriculture sector compared to last year, and further improvement in the current account balance, may also improve the final outcome, the SBP said.

    Inflation, meanwhile, is expected to exceed its annual projection by the Planning Commission of Pakistan for FY20.

    While demand pressures have generally subsided, cost-related impact may be more pronounced in the first half of the fiscal year, taking the cue from oneoff adjustment in prices of utilities and other FY20 budget-related measures.

    By the second half, further supported by the end of deficit monetization by the government, price pressures may begin to recede, setting the tone for considerably lower inflation in FY21. However, crossborder tensions (which have flared up intermittently since Q3-FY19 and worsened during Q1-FY20) represent an upside risk to this outlook, given their tendency to drive up food inflation.

    At the same time, the global slowdown may pose a downside risk to the outlook, especially if international oil prices fall more sharply than anticipated.

    The external sector’s outlook is positive on the whole, albeit being subject to both upside and downside risks. The current account deficit, after shrinking on YoY basis during FY19, is anticipated to subside further in FY20.

    Exports are projected to pick up during the year, conditional on demand conditions among the country’s major trading partners and buoyancy in commodity markets.

    In particular, onset of fiscal stimulus and successful resolution of trade negotiations involving major economies would be instrumental in supporting global consumer demand, which would in turn bode well for exporting partners, including Pakistan, along with improved prospects of foreign investments.

    The FTA-II with China and preferential trade agreement with Indonesia may also give a boost to exports. Decline in imports would be instrumental in improving the current account as the policy induced import compression would continue on top of subdued prices, barring any adverse shock from international oil prices.

    Moreover, workers’ remittances are expected to remain robust in FY20 on the back of measures taken and incentives given to overseas Pakistanis remitting under the Pakistan Remittance Initiative (PRI).

    The outlook for the fiscal sector, by contrast, is not straightforward. The FY20 budget looks to fix the deficiencies of the tax system and represents an earnest effort to increase documentation.

    It envisages a sizeable reduction in the deficit, by enhancing revenues and squeezing expenditures. However, achieving the ambitious tax collection target in the middle of a broader economic slowdown may present a challenge.

    Moreover, even if things pan out more or less according to plan, the fiscal deficit may be in the neighborhood of 7 percent nevertheless, implying that there would still be some way to go before fiscal consolidation is achieved. That said, the government is expected to make a concerted effort to meet the IMF’s quarterly targets, implying a measure of fiscal discipline.

    On an optimistic note, the private sector would be mindful that even as the economy rebalances and there is reduced demand in some sectors, new opportunities are simultaneously opening up in other areas.

    For example, imports of many consumer items and finished goods are shrinking due to a combination of regulatory duties and exchange rate depreciation. This generates an opportunity for domestic companies to step in and fill in this demand in the short to medium term.

    Moreover, alignment of the exchange rate represents improved prospects for export-oriented enterprises. The government’s stated commitment to foster the ease of doing business and pursue investor-friendly policies is also welcome.

    Meanwhile, domestic investors should also be looking to tap underserved markets and segments. Beyond provision of traditional goods and services, innovation must be the new watchword.

    It is especially encouraging to see that proactive, technology-driven domestic startups have already ushered in a positive disruption in industries ranging from banking (fintechs) to transportation (ride hailing apps) and consumer goods and food (delivery apps), to name just a few. Such examples may inspire those investors who have been sitting on the fence for some time now to abandon the wait and-see mode, and take positions sooner rather than later.

    In the grand scheme of things, a collective shift in sentiment and more optimism could prove to be a much needed catalyst for the revival of economic activities.

  • Pakistan’s forex reserves increased by $149.7 million

    Pakistan’s forex reserves increased by $149.7 million

    KARACHI: The total liquid foreign exchange reserves have increased by $149.70 million to $15.142 billion by week ended October 11, 2016 as compared with $14.992 billion a week ago, State Bank of Pakistan (SBP) said on Thursday.

    The reserves held by the central bank increased $56.10 million to $7.813 billion by week ended October 11, 2019 as compared with $7.757 billion.

    The reserves held by other commercial banks increased by $93.6 million to $7.329 billion as compared with $7.235 billion a week ago.

  • Pakistan among top 10 improvers in World Bank’s ease of doing business

    Pakistan among top 10 improvers in World Bank’s ease of doing business

    ISLAMABAD: The World Bank on Thursday said that the enactment of six regulatory reforms has landed Pakistan among the world’s top 10 business climate improvers.

    A study of the World Bank Group’s Doing Business 2020 said that due to a concerted improvement in business regulation, Pakistan climbed 28 places and rose to a rank of 108 in the global ease of Doing Business rankings this year from 136 the previous year.

    “This rise is significant and made possible by collective and coordinated actions of Federal Government and Provincial Governments of Sindh and Punjab over the past year,” said Illango Patchamuthu, World Bank Country Director for Pakistan. “The accelerated reform agenda has many noteworthy features to improve quality of regulations, reduce time and streamline processes. This momentum needs to be sustained in the coming years for Pakistan to continue to make progress.”

    The reforms that helped the country improve its ranking are significant. The country has made starting a business easier by expanding the functionalities of the online one-stop-shop. This reduced the number of procedures required to set up a business from 10 to five and improved the economy’s score for starting a business. Additionally, in Lahore, the Labor Department registration fee was abolished.

    Authorities made the approval process for obtaining a construction permit easier and faster in both Karachi and Lahore. In Karachi, the process was also made safer by ensuring that building quality inspections take place regularly. Pakistan also eased the process for paying taxes by introducing online payment modules for value added taxes and corporate income taxes. The government also lowered the corporate income tax rate for the 2018 fiscal year. This reform reduced the number of payments from 47 to 34 and the total number of hours required to comply with tax requirements per year from 294 to 283.

    Pakistan also made it easier to get electricity and register property. Karachi and Lahore enforced service delivery time frames and launched an online portal for new applications. In addition, the country increased the transparency of electricity tariff changes. Karachi made property registration faster by making it easier to execute and register a deed at the Office of the Sub-Registrar. Lahore increased the transparency of the land administration system by publishing its fee schedule online. Lastly, in the area of trading across borders, Pakistan enhanced the integration of various agencies in the Web-Based One Customs (WEBOC) electronic system and ensured coordination of joint physical inspections at the port.

    Pakistan continues to perform best on the protecting minority investors indicator, earning the maximum possible points on the extent of ownership and control index, which measures governance safeguards protecting shareholders from undue board control. Globally, Pakistan is in the top 30 economies on this measure.

    Going forward, Pakistan has other opportunities for improvement in the areas measured by Doing Business. For example, on enforcing contracts, the country ranks 156th. It takes 1,071 days to resolve a commercial dispute in Pakistan, almost twice the average among OCED high-income economies.

  • FATF gives Pakistan four months to comply with action plan

    FATF gives Pakistan four months to comply with action plan

    ISLAMABAD: Financial Action Task Force (FATF) on Friday set a deadline of four months for Pakistan to improve action plan against laundering and terror financing.

    At a press conference in Paris, France the officials of FATF expressed concerns over implementation of action plan by the Pakistani authorities.

    FATF strongly urged Pakistan to swiftly complete its full action plan by February 2020. Otherwise, should significant and sustainable progress not be made across the full range of its action plan by the next Plenary.

    It has been observed that action taken by Pakistan was not sufficient to address its Terror Financing risks. These include remaining deficiencies in demonstrating a sufficient understanding of Pakistan’s transnational Terror Financing risks.

    Pakistan’s failure to complete its action plan in line with the agreed timelines and in light of the terror financing risks emanating from the jurisdiction.

    To date, Pakistan has only largely addressed five of 27 action items, with varying levels of progress made on the rest of the action plan.

    In a statement, the ministry of finance said that the FATF Plenary meeting was held in Paris from 13-18 October 2019. The Pakistan delegation was led by Muhammad Hammad Azhar, Minister for Economic Affairs Division.

    The FATF meeting considered Pakistan’s progress report on the FATF Action Plan and Pakistan’s APG Mutual Evaluation report (MER).

    Pakistan’s delegation reaffirmed its political commitment to fully implement the Action Plan.

    The Plenary meeting decided to maintain status quo on the FATF Action Plan and allow the usual 12 months observation period for the APG MER.

    The delegation also held sideline meetings with various delegations and briefed them about the progress made by Pakistan on the FATF Action Plan and steps taken for strengthening its AML/CFT framework.

    A session on technical assistance and training needs of Pakistan was also organized in collaboration with UNODC and APG Secretariat which was attended by a number of interested countries and multilateral agencies including China, USA, UK, Canada, Japan, EU, World Bank, IMF, ADB, and UNODC.

  • NAB establishes AML/CFT cell

    NAB establishes AML/CFT cell

    ISLAMABAD: National Accountability Bureau (NAB) on Thursday established Anti-Money Laundering (AML)/ Combating the Financing of Terrorism (CFT) cell at the bureau.

    The cell will be headed by Zahir Shah, Director General, Operation, NAB Headquarters, Islamabad and would be comprised of the following officers:

    01. Zafar Iqbal, Director Monitoring

    02. Mufti Abdul Haq, Additional Director/Desk Officer

    03. Jahanzeb Fareed, Banking Expert

    04. Sohail Ahmed, Banking Expert

    05. Nasir Mehmood Mughal, Senior Legal Consultant (Prosecution Division)

    The main responsibilities of the cell would include compliance, monitoring, analysis and coordination with national FATF Secretariat and relevant stakeholders.