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.

  • Commission directed to submit privatization proposals for Steel Mills

    Commission directed to submit privatization proposals for Steel Mills

    ISLAMABAD: Cabinet Committee on Privatization (CCoP) on Monday directed Ministry of Industries and Production and Privatization Commission to present proposals for the privatization of Pakistan Steel Mills.

    Adviser to the Prime Minister on Finance, Revenue and Economic Affairs, Dr. Abdul Hafeez Shaikh, chaired meeting of CCoP.

    The committee discussed the privatization of Pakistan Steel Mills.

    While presenting the report of the task force on energy reform, the Ministry of Energy briefed the Committee about the challenges being faced by the DISCOs.

    Various measures recommended by the task force for improving the performance of energy sector with a focus on reduction of losses and enhancing the efficiency of DISCOs were discussed during the meeting.

    The Committee directed the Ministry of Energy to submit proposals aimed at accelerating closure of those GENCOs that have outlived their recommended life and are running into losses. Issue of delisting of House Building Finance Corporation Ltd (HBFC) from the privatization list was also recommended to be presented in the next meeting.

    The Meeting was attended by the Federal Minister for Privatization, Muhammad Mian Soomro, Adviser on Commerce, Textile, Industry and Production and Investment, Abdul Razak Dawood, various Federal Secretaries and senior officials of the government of Pakistan.

  • Foreign exchange reserves slip to $14.827 billion

    Foreign exchange reserves slip to $14.827 billion

    KARACHI: The total foreign exchange reserves of the country have slipped by $63 million to $14.827 billion by week ended June 03, 2019 as compared with $14.89 billion as on May 31, 2019, State Bank of Pakistan (SBP) said on Thursday.

    The official foreign exchange reserves of the SBP reduced by $55 million to $7.807 billion by week ended June 03, 2019 as compared with $7.862 billion on May 31, 2019.

    The central bank said that its reserves were declined due to payments on account of external debt servicing.

    The reserves held by commercial banks also fell by $8 million to $7.019 billion from $7.027 billion.

  • Prime Minister constitutes commission to probe Rs24 trillion borrowing in ten years

    Prime Minister constitutes commission to probe Rs24 trillion borrowing in ten years

    ISLAMABAD: Prime Minister Imran Khan on Tuesday constituted a commission to probe the unprecedented borrowing of Rs 24 trillion during past ten years and to set an example for those who looted the country.

    In a nationwide televised address, hours after the announcement of the national budget Prime Minister Imran Khan said, “Pakistan today was economically stable … I will now go after all of them [the leaders of PPP and PML-N] and take them to task for ruthlessly plundering the national wealth.”

    “I will make them answerable. I will investigate, and I will not spare them even if it is a threat to my life,” Imran said, after the national budget in which the government withdrew subsidies on many sectors and taxed almost all the sectors.

    The commission will comprise of officials from Federal Investigation Agency (FIA), Intelligence Bureau (IB), ISI, Federal Board of Revenue and Securities and Exchange Commission of Pakistan (SEC).

    The prime minister said that his PTI led government had present maiden budget and it would reflect the manifesto of the party.

    Talking about the latest arrests of political leaders, he said that no one ever think about these stalwarts behind the bars.

    He said that today the judiciary and National Accountability Bureau (NAB) are independent. He said that cases against PML-N leaders were not instituted by his government. “Yet they blame me for their arrests,” he added.

  • Budget 2019/2020: Rs951 billion allocated for PSDP

    Budget 2019/2020: Rs951 billion allocated for PSDP

    ISLAMABAD: The federal government has allocated Rs951 billion for development projects under Public Sector Development Program (PSDP) for fiscal year 2019/2020.

    In his budget 2019/2020 speech State Minister for Revenue Hammad Azhar said that the government has allocated Rs951 billion for federal PSDP, which was Rs500 billion in the ongoing fiscal year.

    This year, the combined allocation of national programs is Rs.1,863 billion.

    Out of this the Federal PSDP is Rs.951 billion which will be increased from Rs.500 billion.

    Policy priorities are water management, building a knowledge economy, fixing electricity transmission and distribution, low-cost hydel power generation, China-Pakistan Economic Corridor, investing in human and social development and “Public Private Partnership” in eligible sectors such as highways.

    Notable details are:

    a. Water – To better utilize our water resources the PSDP focus is on building dams and drainage projects with an allocation of Rs.70 billion. Diamer Bhasha Damshall be allocated Rs.20 billion for land acquisition, while Mohmand Dam “hydel power” will get Rs.15 billion for its ongoing construction.

    b. Road / rail networks – Some of these projects of road networks are also part of China-Pakistan Economic Corridor. Around Rs.200 billion is allocated of which Rs.156 billion is through the National Highways Authority. Key projects are:

    Rs.24 billion for Havelian-Thakot road

    Rs.13 billion for Burhan-Hakla motorway

    Rs.19 billion for Sukkur-Multan section of Peshawar-Karachi motorway.

    Additionally, “Public Private Partnership” financing mode will be utilised for construction of Chakdara-Bagh Dheri extension of Swat expressway, Construction of road from Sambrial-Kharian Motorway, and dualization of Mianwali-Muzaffargarh road.

    c. Energy –Rs.80 billion of projects shall be undertaken. For construction of Dasu hydro power Rs.55 billion are allocated.

    d. Human development / knowledge economy–Rs.58 billion are proposed in budget for human development. Health, education, attainment of development goals, and climate change are some of the key areas. For higher education record funds of Rs 43 billion are proposed to for an important sector

    e. Agriculture – While agriculture sector is administratively under the domain of the provinces, the Federal Government is investing a recordRs.12 billion for multiple projects in consultation with them

    f. Quetta development package – the government has announced second phase of “Quetta development package” for Rs.10.4 billion. This is in addition to Rs.30 billion of water and road sector projects that the federal government is financing

    g. Karachi development package –9 projects costing Rs.45.5 billion are being undertaken.

  • Budget 2019/2020: No SBP borrowing from July 01

    Budget 2019/2020: No SBP borrowing from July 01

    ISLAMABAD: The government has decided not to borrow from State Bank of Pakistan (SBP) from July 01, 2019 due to high inflation concerns.

    State Minister for Revenue Hammad Azhar while presenting budget 2019/2020 has said that the government would take all possible measures for minimal increase in prices.

    If, however due to movement in international markets we are forced with any price increase we will ensure that consumers are protected to the extent possible.

    Accordingly, we have made budgetary allocations to enhance social safety net for the vulnerable population.

    Fighting inflation will be paramount for us. “We will tailor our fiscal and monetary policies, coordinate with the provinces and adopt administrative measures to fight this menace.”

    The measures proposed for 2019-2020 budget shall be as follows:

    Government borrowing from the State Bank is inflationary, the government will no longer use this facility with effect from 1 July 2019

    Our medium-term inflation target will be in the range of 5 – 7 percent.

    In addition, we will continue to focus on good governance and remain committed to fighting corruption. We will assign autonomy to our institutions, strengthen their capacity and choose their leadership on merit.

    The year 2019-20 shall continue to be the period of stabilization. This is a difficult transition that we want to achieve within a minimum amount of time. We will try to minimize the adverse effects of any difficult decisions on our citizens.

  • Budget 2019/2020: Rs5,550 billion tax collection target set to reduce fiscal deficit

    Budget 2019/2020: Rs5,550 billion tax collection target set to reduce fiscal deficit

    ISLAMABAD: State Minister for Revenue Muhammad Hammad Azhar on Tuesday said that the government has set a challenging target of Rs5,550 billion revenue collection target for Federal Board of Revenue (FBR) in order to reduce the fiscal deficit.

    Presenting budget for fiscal year 2019/2020 on floor of house, the state minister said that by reducing imports and aiming for higher exports.

    “We want to bring current account deficit from $13 billion estimated this year to $6.5 billion in 2019-20,” he said.

    For increasing exports, the government will:

    Support duty structure on raw materials and intermediate goods

    Improve mechanism for tax refunds

    Provide electricity and gas at competitive cost

    Redo the Free Trade Agreements and make Pakistan part of the global value chain.

    He said that a challenging target of Rs.5,555 billion FBR revenue collection will be combined with aggressive expenditure controls to reduce primary deficit to 0.6 percent of GDP.

    Both the civil and military governments have announced unprecedented reduction in expenditure.

    He said that the government’s top priority is to enhancement of taxes.

    Pakistan has one of the lowest tax-to-GDP ratios at below 11 percent which is lower than others in our region. Only 2 million people file income tax returns – of which 600,000 are employees. 380 companies alone account for more than 80 percent of the total tax.

    There are over 341,000 electricity and gas connections – but only 40,000 are registered with sales tax.

    Only 1.4 million out of 3.1 million commercial consumers pay tax. There are estimated 50 million bank accounts but only 10 percent pay taxes. Out of 100,000 companies registered with Securities and Exchange Commission of Pakistan (SECP only half pay tax.

    Many rich do not to contribute to our taxes. This has to change in Naya Pakistan.

    Austerity shall be put in place in the regular civil and defence budgets. As a result, the running of civil government which was Rs.460 billion this year, is being budgeted at Rs.437 billion for the coming year, a decrease of 5 percent.

    The defence budget is being maintained at the last year level of Rs.1,150 billion. “In taking these difficult decisions on austerity, I want to appreciate the wisdom of the Prime Minister and the support of armed forces leadership in particular the Army Chief. Let me be clear on one point the sovereignty and defence of Pakistan is paramount.”

    All other considerations are secondary to that of national dignity and honour. We will ensure that the capacity of our armed forces to defend our country and our people is never compromised.

    Pakistan cannot develop until we reform our tax system. Historically, we have under allocated for health, education, drinking water, municipal services, and things that matter to the people. Now we are reaching a point where we have difficulty in paying our debts and even our salaries without recourse to borrowing. This situation has got to change.

  • Budget 2019/2020 with massive tax burden presented

    Budget 2019/2020 with massive tax burden presented

    ISLAMABAD: The present government on Tuesday presented its first budget with total outlay of Rs 7,022 billion for the fiscal year 2019-2020, registering growth of 30 percent against the revised budget of Rs 5.385 trillion for current fiscal year (2018-2019).

    State Minister for Revenues Hammad Azhar presented the budget in the National Assembly, amid protest by the Opposition parties.

    The minister said that total federal revenues have been estimated at Rs 6,717 billion which is 19 percent higher than the previous year’s revenues of Rs 5,661 billion.

    The collection of revenues by Federal Board of Revenue (FBR), he said are estimated to be recorded at Rs 5,555 billion which are 12.6 percent of Gross Domestic Product (GDP). In order to achieve the revenue collection target the government introduced massive budgetary measures across the board.

    The minister of state said out of total revenue collections, an amount of Rs 3.255 trillion would be distributed among the provinces under 7th National Finance Commission (NFC) Award which is 32 percent higher than the current year’s share of Rs 2.465 trillion.

    He said Net Federal Revenues for the upcoming fiscal year have been estimated at Rs 3.46 trillion against the revenues of Rs 3.07 trillion during current fiscal year which is 13 percent higher.

    Similarly, he said the federal budget deficit would be Rs 3.56 trillion whereas the provincial budget surplus is estimated to be at Rs 423 billion for the year 2019-2020.

  • World Bank helps Sarena Hotels to obtain global business certification for gender equality

    World Bank helps Sarena Hotels to obtain global business certification for gender equality

    ISLAMABAD: International Finance Commission (IFC), a member of the World Bank Group, is partnering with one of the largest hotel chains in South Asia, Serena Hotels Pakistan, to help it become the first company in Pakistan to obtain the leading global assessment and business certification for gender equality—EDGE (Economic Dividends for Gender Equality), a press release said on Tuesday.

    Currently, in Pakistan, only about one in four women work and just 7 percent of the country’s workforce is female.

    The certification evaluates companies’ workplace gender equality performance against global and industry benchmarks, helping them become a gender equal environment to work in, invest in, and do business with. EDGE currently works with nearly 200 organizations in 50 countries and 23 industries.

    “Our collaboration with IFC on gender-smart initiatives will allow us to help our women Associates, while benefiting from attracting and utilizing their talent in our Company. Most importantly, it will allow us to further improve the workplace where all Associates are viewed as equal, so that we have a more productive, engaged, loyal, and skilled team. Gender equality is a win-win for both our Associates and business,” said Aziz Boolani, CEO of Serena Hotels in Pakistan.

    Headquartered in Islamabad, Serena Hotels Pakistan, a recipient of “Employer of Choice for Gender Balance-2018” employs 12 percent women in a workforce of 1,900.

    Through the EDGE gender assessment process and with support from IFC, the group aims to further enhance gender balance by creating more opportunities for women’s employment, capacity building of high-potential women Associates to leadership training and skill development of women at community level for entrepreneurship.

    “There’s no doubt that companies can deliver greater business impact and be more competitive by fostering an equitable and inclusive workplace for women and men,” said Nadeem Siddiqui, IFC’s Senior Country Manager in Pakistan.

    “We hope more companies in Pakistan will discover the strength of the business case for greater gender equality in the workplace.”

  • PIA implements business plan to improve financial health

    PIA implements business plan to improve financial health

    ISLAMABAD: Pakistan International Airlines Corporation (PIAC) has implemented strategic business plan to improve its financial health, according to Economic Survey 2018/2019 launched a day earlier.

    It said PIA came into existence in 1955 as Public Sector organization.

    However, in April 2016 it was converted from a statuary organization to a company governed by Companies Act 1984, through Pakistan International Airlines Limited (PIAL conversion) Act 2016.

    At present PIA is passing through a dire financial state. However, the present government is very keen to make itself-reliant.

    Efforts are underway to improve the financial health of the corporation by reducing its losses through various means and modes. Stringent action is being taken against corruption and mismanagement.

    Despite financial constraints and tough and uneven competitive environment, PIACL gave a stable performance during 2018.

    To reduce losses, PIA had to take measures like route rationalization and suspended its loss making routes.

    PIA is in the process of its Strategic Business Plan 2019-23 to improve its performance:

    i. Launching of profitable new routes like Silakot-Sharjha, Lahore-Muscat, Islamabad-Doha and Lahore-Bangkok-Kualalalmpur. These routes are going very strong and economically viable

    ii. More new routes have been started which include; Sialkot-Paris-Barcelona, Peshawar-Sharjha, Peshawar-Al Ain and Multan-Sharjha

    iii. Increasing frequencies and capacity on profitable routes like Jeddah and Madinah coupled with closure of loss making routes like New York, Salalah (Oman), Kuwait, Mumbai

    iv. Stoppage of all officiating and extra allowances given on additional assignments to officials

    v. Ban on overtime allowances in all cadres along with monitoring of flights by senior officials

    vi. Increasing regularity and punctuality of flights by assigning target to be achieved 90 percent

    vii. Improvement in flight services, training of crew and regular monitoring

    viii. Introduction of executive economy class on European and Gulf sectors which are attracting more customers

    ix. Rationalization of fares according to market demand thus helping in increase of seat factor

    x. Delays of flights have been cut down significantly by better planning in engineering, flight operation and ground handling departments

    xi. Special emphasis on cargo business with monitoring of performance, rationalization of cargo fares and more effective liaison with all stakeholders

    The survey said PIA is in process of acquiring new aircraft for its fleet. Presently, a tender has been floated for four narrow body aircrafts according to PPRA rules.

    PIA has submitted its business plan to the federal government and now it is under consideration for approval of Federal Cabinet.

  • LSM growth exhibits massive decline on lower PSDP spending

    LSM growth exhibits massive decline on lower PSDP spending

    ISLAMABAD: The Large-Scale Manufacturing (LSM) declined by 2.93 percent during July-March 2018/2019 in contrast to growth of 6.33 percent during the same period last year. The target for this year was 8.1 percent, said Economic Survey 2018/2019 released on Monday.

    “The present trend suggests that full year LSM growth will remain below the target by a wide margin,” according to the economic survey.

    Year on Year (YoY), LSM growth witnessed sharp decline of 10.63 percent in March 2019 as compared to increase of 4.70 percent in March 2018.

    There are a number of factors which have contributed to the negative growth in LSM.

    These include lower Public Sector Development Program (PSDP) expenditures compared to last year, muted private sector construction activities and lower consumer spending on durable goods amongst others.

    This was more noticeable in construction-allied industries. Demand for housing moderated as the price of building materials and cost of financing increased. Moreover, additional tax measures further restricted the real estate market.

    Certain sector-specific issues also contributed to the decline in LSM. Automobile prices witnessed multiple upward revisions due to PKR depreciation which made the potential buyers refrain from making booking and purchases.

    Certain restrictions on non-filers with respect to purchase of cars further dampened the automobile demand.

    Pharmaceuticals also suffered due to a considerable lag in regulatory adjustments in prices.

    This pricing issue was in addition to weakening of the local currency, which added to the distress of an import dependent sector.

    The industry specific data shows that electronics recorded highest growth of 23.70 percent, wood products 15.21 percent, rubber products 3.47 percent, engineering products 9.54 percent, leather products 0.97 percent and fertilizers 4.50 percent.

    The industries which recorded negative growth during the period are; Iron & Steel 11.00 percent, Pharmaceuticals 8.40 percent, Automobile 7.58 percent, Coke & Petroleum products 6.00 percent, Food Beverages & Tobacco 4.69 percent, Chemicals 3.94 percent, Paper & Board 3.86 percent, Non-metallic mineral product 4.96 percent and Textile 0.30 percent.

    The Mining and Quarrying sector declined by 1.96 percent during Jul-Feb FY 2019 in contrast to the growth of 7.7 percent during the same period last year. Chromite, Magnesite, Rock salt, Barytes, Ocher and Crude oil posted a positive growth of 228.69 percent, 159.63 percent, 12.65 percent, 22.15 percent, 19.12 percent and 0.47 percent respectively.

    However, some minerals witnessed negative growth during the period under review such as Coal 25.42 percent, Natural gas 1.98 percent, Sulphur 40.72 percent, Calcite 91.49 percent, Soap stone 13.12 percent, Marble 4.66 percent and Bauxite 30.82 percent.