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KARACHI: The restriction on non-filers to purchase cars during first half of current fiscal year has reduced the delivery time and also reduce the own money for immediate delivery in the grey market.
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KARACHI: State Bank of Pakistan (SBP) has projected the real GDP growth for fiscal year 2018/2019 would be around 3.5-4 percent much lower than the actual target of 6.2 percent.
The central bank in State of Pakistan Economy, Second Quarterly Report for Fiscal Year 2018/2019, issued on Monday the SBP further projected that the inflation would further increased to 6.5-7.5 percent during the current fiscal year as compared with actual target of 6 percent.
The GDP growth for fiscal year 2017/2018 was 5.2 percent and inflation for the same year was recorded at 3.9 percent.
The central bank estimated that remittances would be above the target during the current fiscal year to $21.5 billion. However, estimates for exports are at $25.5-27 billion lower than the target of $27.9 billion. Meanwhile, the estimates for imports have also been lowered to $54-56 billion from actual estimate of $58.5 billion.
The SBP estimated that the fiscal deficit would be around 6-7 percent against target of 4.9 percent. The fiscal deficit was at 6.6 percent last year. The current account deficit would stay around 4.5-5.5 percent of the GDP as against the target of 4 percent.
The SBP said that real GDP growth during FY19 is likely to moderate significantly, mainly due to slowdown in the growth of the agriculture sector and stabilization measures taken to preserve macroeconomic stability.
This is in line with a further contraction in LSM during Q2-FY19. Moreover, given that public development spending, a key driver for private sector industrial activities, is unlikely to pick up anytime soon, the full year outlook for manufacturing activities remains subdued.
Furthermore, private consumption is going to remain lower due to tighter monetary policy and pass through of exchange rate depreciation that has resulted in both higher energy prices and core inflation.
In addition, the prospects for the upcoming wheat crop remain subdued in terms of growth. All these aspects are going to constrain the services sector in the coming months as well.
Regarding price pressures, inflation is expected to remain high in H2-FY19. This is due to the second round impact of recent exchange rate depreciations, an upward adjustment in gas and electricity prices and higher budgetary borrowing from SBP.
However, the lagged impact of policy rate increases would be instrumental in keeping demand pressures in check. Acknowledging these risks, SBP continues to project average CPI inflation at 6.5-7.5 percent for the full year.
As noted earlier, the primary deficit has increased further while there has been a sharp reduction in development expenditures in order to improve the fiscal position.
This situation has become more challenging as the growth in current expenditure inched up to 17.3 percent during the first half as compared to 13.5 percent last year.
On the contrary, revenue collection has contracted by 2.4 percent during the same period as compared to the growth of 19.8 percent last year.
Since there is limited room to curtail government expenditures in the coming months, it is the growth in revenues that would be instrumental in determining the overall fiscal position for FY19.
Incorporating the performance of revenue collection during the second half in the last four years, SBP projects fiscal deficit to further deteriorate by 0.5 percent of GDP, which brings it close to the same level as in FY18.
As for the external sector, while the CAD has improved by USD 1.7 billion during the first seven months of FY19, it is still high at USD 8.4 billion.
Some improvement is expected to continue in the remaining months as imports are likely to contract further on account of moderating domestic demand and relatively low international oil price as compared to that at the beginning of FY19.4 However, merchandize exports are expected to miss the target due to waning demand in certain export destinations.
Additionally, this is compounded by the competitive pressures in the international arena and the lack of diversified and higher value
added products that can effectively utilise the export quotas allowed under specific trade agreements.
Meanwhile on the external financing front, the efforts of the government have started to materialize in the shape of bilateral inflows from Saudi Arabia, UAE and China. Some of these inflows have already been realized, while rest are due in H2-FY19.
Along with the Saudi deferred oil payment facilities, these inflows have an important role in meeting the external financing gap for FY19; thereby, relieving pressure on the foreign exchange reserves and mitigating volatility in the FX market.
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KARACHI: The investment in prize bonds has soared to Rs929.64 billion by January 2019 as compared with Rs794.09 billion by the same month of the last year, showing an increase of 17.07 percent.
According to statistics issued by State Bank of Pakistan (SBP), the savings mobilized through prize bonds had increased to Rs929.64 billion January 2019 through different categories of prize bonds.
The statistics have shown the investment in higher denomination prize bonds increased more rapidly then the lower denomination.
Following is the position of investments in different prize bonds:
(Rs in million)
| S. No. | Prize Bonds | Jan 2019 | Jan 2018 | % Increase |
| 01 | Rs100 | 9,771 | 8,795 | 11.09 |
| 02 | Rs200 | 29,325 | 27,076 | 8.30 |
| 03 | Rs750 | 98,590 | 86,520 | 13.95 |
| 04 | Rs1,500 | 105,019 | 90,078 | 16.58 |
| 05 | Rs7,500 | 96,221 | 75,317 | 27.75 |
| 06 | Rs15,000 | 173,803 | 144,780 | 20.04 |
| 07 | Rs25,000 | 156,923 | 135,080 | 16.17 |
| 08 | Rs40,000 | 259,130 | 225,586 | 14.86 |
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KARACHI: Pakistan’s foreign exchange reserves have increased by $743 million to $15.709 billion with inflows of $1 billion from UAE.
The total reserves of the country increased to $15.709 billion by week ended March 15, 2019 as against $14.966 billion a week ago, according to data of State Bank of Pakistan (SBP) issued on Thursday.
During the week ending March 15, 2019, SBP received inflow of $1 billion from UAE as placement of funds.
After taking into account outflows relating to external debt and other official payments, SBP reserves increased by $716 million during the week, SBP said.
The official reserves of the central bank increased to $8.838 billion by week ended March 15 from the level of $8.122 billion a week ago.
Similarly, the foreign exchange reserves held by commercial bank have increased by $27 million to $6.87 billion from previous week’s level of $6.843 billion.
ISLAMABAD: The investment into premium prize bonds of Rs40,000 has registered significant increase of 30 percent owing to attractive avenue for persons having legitimate money.
The investment into the premium prize bonds increased to Rs5.86 billion by January 2019 as compared with Rs4.52 billion in the same period of the last year.
In order to promote documentation of economy, the registered bonds with denomination of Rs40,000 was launched two years ago.
The first prize of the premium bond is Rs80 million and the winner of the draw will get the prize money directly to his bank account.
The registered bond is only issued against Computerized National Identity Card (CNIC) and account maintenance certificate of the account number mentioned in application.
The bond has bi-annual profit at three percent per annum for all premium prize bond holders.
ISLAMABAD: The government has accorded approval to a consortium led by Credit Suisse to act as financial consultants for the privatization of the RLNG power plants.
The approval was given at a meeting of the Board of Privatization Commission chaired by Federal Minister of Aviation and Privatization Muhammad Mian Soomro.
The transparent and appropriately appraised value of privatization of state owned enterprises is one of the major priorities of the current government and shall be successfully undertaken with due regard to every possible minutiae, Soomro said.
The meeting was attended by Secretary Privatization Rizwan Malik and the board members of the Privatization Commission.
A number of essential issues were on the agenda. The Minister was briefed about the progress made in the Privatization process of a number of state owned enterprises.
These enterprises include Mari Petroleum, SME Bank and First Woman’s Bank. Other state owned entities which are to be privatized on priority basis were also discussed. These include Services Hotel and Convention Centre, Islamabad.
The Minister was apprised of the current status of the process for each entity and the Minister ordered that it should be ensured that every possible step is taken to ensure a transparent and financially feasible privatization.
The meeting also confirmed the minutes of the Third Meeting (03/2018) of Privatization Commission Board which was held on 18th December, 2018 and also reviewed the status of decisions of the Third Meeting of the PC Board. The appointments of Consultants of the Privatization Commission were also discussed.
It was also decided in the meeting that a steering committee headed by the Minister for Privatization, including relevant stakeholders shall over see the implementation process of privatization.
KARACHI: Pakistan has been rated amongst most charitable nations in the world but most donations are routed informally which makes the whole exercise prone for terror financing and money laundering, Waseem Ahmad Khan, Additional Director, Securities and Exchange Commission of Pakistan (SECP) said on Wednesday.
He was addressing at a seminar organized by Karachi Tax Bar Association (KTBA) at auditorium of Regional Tax Office (RTO) Karachi.
He said that SECP and State Bank of Pakistan (SBP) had taken initiatives to fix the issues on Anti Money Laundering (AML)/Countering Financing Terrorism (CFT) pointed out by Financial Action Task Force (FATF).
He informed the participants that FATF is a 37-member global body established in 1989 with mandate to combat money laundering, terror finance and nuclear non-proliferation. Besides it has also associates observers.
Pakistan as a member has international obligations to comply with FATF recommendations and correspondingly it had promulgated relevant laws including Anti-Terrorist Act, 1997, Anti-Money Laundering Act, 2010, National Counter Terrorism Act, 2013 etc. and had also devised national action plan.
Waseem Ahmad said that the SECP was undertaking enhanced due diligence on the basis of territorial / geo-political basis, sectoral lines and channel of donations.
In order to realize the full impact of spirit of generosity of Pakistan horizontally, he suggested risk management should be set up by every non-profit organization (NPO).
Khalid Mahmood, President, KTBA, in his welcome address thanked the speaker and audience who attended the seminar in a big number. The even was moderated by KTBA vice president Zeeshan Merchant.
ISLAMABAD: The government has posted Younus Dagha, BS-22 officer of Pakistan Administrative Service as Secretary Finance Division with effect from March 22, 2019.
Younus Dagha has been transferred from the present post of Secretary, Commerce Division, a notification issued by Establishment Division on Wednesday.
According to profile Mohammad Younus Dagha, born on April 23, 1962, is a career Civil Servant having joined the Government of Pakistan in 1985.
He possesses varied experience in the fields of Energy, Finance, Commerce, International Trade and Public Administration. He holds post graduate degrees in Business Administration, Economics, Law and Commerce equipping him with required academic background to adeptly manage multifaceted assignments in his career.
During an illustrious career spanning over 20 years, he has successfully accomplished many challenging assignments. From being an Administrator at various tiers in the Provinces of Sindh and Khyber Pakhtunkhwa to Project Director in mega projects,
Dagha possesses a vast and varied experience. He was assigned the challenging task of bringing country’s unutilised energy treasure in the Thar Coalfields to fruition – an immense natural resource with a potential of 175 billion tons of lignite coal, which till then had become an abject failure.
Dagha conceived and successfully executed a plan to bring back the local and international investors’ interest in the development of the Thar coalfield.
The JV between the GoSindh and Engro, known as Sindh Engro Coal Mining Company is now set to become the largest Public Private Partnership Company in Pakistan.
As Secretary Investment in Sindh, Dagha facilitated numerous Wind Energy projects in Jhampir-Gharo Wind Corridor which are now fast reaching their execution stage.
Similarly, during his stay in Gilgit-Baltistan as Chief Secretary, he played a vital role in facilitating land acquisition and resettlement process which is at a final stage now.
Younus Dagha joined as Federal Secretary in the Ministry of Water and Power on 17th Oct 2014, at a difficult juncture when the power sector was facing multiple crises. Power outages, especially in the Industrial sector, were taking a toll on the economy, causing frequent protests.
The inter-corporate (circular) debt in the sector was continuously mounting at a pace of Rs. 14.5 billion every month, the generation had retarded due to drying cash flow and no new investments were forthcoming under serious doubts over sector’s capacity to pay.
The ensuing year 2015 became a game changer for the power sector. Benefitting from the assiduous management, effective monitoring and better financial controls brought in by Dagha, the power sector witnessed a major turnaround.
The investors, especially under China-Pakistan Economic Corridor, were provided with the required policy incentives and facilitation to ensure timely initiation of the new generation and transmission projects.
The result was that 2015 became the best performance year for the power sector not only in the history of the country but in the entire region.
Country’s exports were in continuous decline for the last three years and a BoP crisis seemed imminent when Dagha was appointed as Secretary Commerce in April 2017, to salvage the grim situation.
On assuming charge as the new Secretary, Dagha chalked out an elaborate reform agenda for the Ministry of Commerce and its attached organizations.
Ranging from Governance Reforms to Policy, Institutional and Commercial Diplomacy, all critical facets affecting the performance of the Ministry were revamped.
In a short span of nine months he was able to secure and successfully implement a Prime Minister Export Enhancement Package to the tune of Rs. 180 billion for supporting the export industry.
On the policy side, his achievements include; rationalization of imports, effective enforcement of SPS standards, simplification of procedures, formulation of e-commerce framework and preparation of five year Strategic Trade Policy Framework to provide a long-term predictable regime.
His accomplishments in the area of Commercial Diplomacy comprise successful midterm review of GSP plus, launching of ‘Look Africa Plan’ market access strategy for South American region, unilateral expansion of Indonesia Pakistan Preferential Trade Agreement to include Pakistan’s priority export products, breaking the deadlock of long stalled negotiations on 2nd Phase of Pakistan China FTA and putting in place a robust monitoring mechanism to evaluate performance of the trade officers posted abroad.
By far his most remarkable initiative is the launching of “Emerging Pakistan” campaign to successfully brand country’s image internationally.
As a result of his prudent and timely interventions the decline in exports was not only arrested but put on a growth trajectory. Between July to December, 2017 the exports registered an average growth of 12 percent.
Apart from this, Dagha’s tenure in the Finance Ministry as Special Assistant to FM and Additional Secretary (External Finance) provided him the insight into the working of the International Financial Institutions.
KARACHI: The import of mobile phones has declined by 22.15 percent in February 2019 following imposition of mandatory registration with regulatory authority, said Pakistan Bureau of Statistics (PBS) on Saturday.
The import of cellular phones reduced to $54.32 million in February 2019 when compared with $69.78 million in the same month of the last year.
It is pertinent to mention here that cell phone registered with Pakistan Telecommunication Authority (PTA) will be activated in the country.
This mandatory requirement has stopped influx of all unregistered phones into the country and resulted in saving precious foreign exchange.
The overall imports of cell phones during July – February 2018/2019 also showing decline of 9.11 percent to $478.13 million as compared with $526.03 million in the corresponding period of the last fiscal year.
Industry experts said that the rupee depreciation had discouraged the imports.
They also said that in the latest mini-budget the measures taken by the government would further discourage import of luxury cell phones.
The government revised upward the regime of duty and taxes for import of mobile phones into the country.
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KARACHI: Pakistan’s current account deficit has narrowed by 22.59 percent during first eight months (July – February) of 2018/2019 owing to increased inflows of foreign remittances and decline in import bill.
State Bank of Pakistan (SBP) on Friday issued Balance of Payment (BOP), which showed that the current account deficit reduced to $8.84 billion during first eight months of current fiscal year as compared with deficit of $11.42 billion in the corresponding months of the last fiscal year.
The trade deficit has narrowed by 11 percent during first eight months of current fiscal year owing decline in import bill.
The trade deficit shrank to $21.52 billion during July – February 2018/2019 as compared with the deficit of $24.19 billion in the corresponding period of the last fiscal year.
The import bill of the country was declined by 6.13 percent to $36.63 billion during first eight months of current fiscal year as compared with $39.03 billion in the same period of the last fiscal year.
However, exports posted growth of 2 percent to $15.11 billion during the period under review as compared with $14.83 billion in the corresponding period of the last fiscal year.
The inflows of home remittances surged by 12 percent to $14.35 billion during first eight months (July – February) of current fiscal year.
Overseas Pakistani workers remitted $14.35 billion in the first eight months (July to February) of FY19, showing a growth of 11.82 percent compared with $12.83 billion received during the same period in the preceding year.
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