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KARACHI: The continuous rise in petroleum prices in Pakistan have pushed headline inflation up 13-year high at 21 per cent in June 2022.
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KARACHI: The current account deficit (CAD) of Pakistan has massively widened to $15.19 billion during 11 months (July – May) of 2021/2022, State Bank of Pakistan (SBP) said Tuesday.
The data of balance of payment (BoP) showed the current account deficit was $1.18 billion in the corresponding months of the last fiscal year.
READ MORE: Current account deficit swells to $13.78 bn in 10 months
The massive widening in current account deficit may be attributed to the high trade deficit on back of significant increase in import bill.
The trade deficit of the country increased by 58.18 per cent to $43.42 billion during July – May 2021/2022 as compared with $27.45 billion in the corresponding period of the last fiscal year, according to data released by Pakistan Bureau of Statistics (PBS).
READ MORE: Pakistan’s CAD hit $13.17 billion in July – March
The import bill of the country surged by 44.51 per cent to $72.29 billion during first 11 months of the current fiscal year as compared with $50 billion in the same months of the last fiscal year.
However, export earnings of also grew by 28 per cent to $28.87 billion during the period under review as compared with $22.57 billion in the same period of the last fiscal year.
READ MORE: Pakistan’s CAD mounts to $12 billion in eight months
Meanwhile, inflows of workers remittances posted a six per cent growth to $28.41 billion during 11 months of the current fiscal year as compared with $26.73 billion in the corresponding months of the last fiscal year.
The current account deficit for the month of May 2022 also widened to $1.425 billion as compared with the deficit of $618 million in April 2022 and the deficit of $640 million in May 2021.
READ MORE: Current account deficit widens to $11.58 bn in 7MFY22
KARACHI: The official foreign exchange reserves of State Bank of Pakistan (SBP) have decreased around 32-month low at $8.238 billion by week ended June 17, 2022, official data revealed on Thursday.
The official reserves of the central bank fell by $747 million to $8.238 billion by week ended June 17, 2022 as compared with $8.985 billion by week ended June 10, 2022.
Previously, the foreign exchange reserves of the SBP were seen on November 01, 2019 when those were at $8.358 billion.
READ MORE: Pakistan’s central bank reserves shrink to one month import cover
Considering the current official reserves of the State Bank at $8.238 billion, the import cover is only for 1.21 months.
The central bank attributed the decline in foreign exchange reserves for external debt repayments. However, SBP reserves are expected to increase in coming days on realization of proceeds of China Development Bank (CDB) loan, the central bank added.
The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021.
READ MORE: SBP’s forex reserves slip 2½-year low to $9.226 billion
Since touching the peak the central bank’s foreign exchange witnessed a continuous decline. The official reserves of the SBP fell around $11.91 billion by week ended June 17, 2022 from touching the peak on August 27, 2021.
The country is facing serious balance of payment crisis during the past many months. The foreign exchange reserves of the central bank have seen a constant decline.
The falling foreign exchange reserves also put pressure on the local currency. The Pakistani Rupee (PKR) is also depreciating to record low against the US dollar on daily basis.
The total foreign exchange reserves of Pakistan have declined to around three-year low at $14.21 billion by week ended June 17, 2022. Previously, the foreign exchange reserves of the country were seen at $14.259 billion by week ended July 5, 2019.
READ MORE: SBP’s forex reserves fall two-year low to $9.72 billion
The country’s foreign exchange reserves have fallen by $733 million to $14.21 billion by week ended June 17, 2022 as compared with $14.943 billion a week ago i.e. June 10, 2022.
The country’s foreign exchange reserves hit all-time high of $27.228 billion on August 27, 2021. Since then the foreign exchange reserves have declined by $13.018 billion.
The foreign exchange held by commercial banks however slightly up by $14 million to $5.972 billion by week ended June 17, 2022 as compared with $5.958 billion a week ago.
KARACHI: Pakistan has decided to impose regulatory duty at 10 per cent from July 01, 2022.
The country presented its federal budget 2022/2023 on June 10, 2022 and proposed increase on regulatory duty on various imported goods.
READ MORE: Penalty amount revised for late filing income tax returns
The Finance Bill, 2022 suggested levying 10 per cent regulatory duty on import of motor spirit as against existing rate of zero percent.
Experts at PwC A.F. Ferguson Chartered Accountants said that the notifications for amendments relating to regulatory duty and additional duty are yet to be issued. “The comments are based on ‘Salient Features’ issued with the finance bill,” they added.
READ MORE: Advance tax on immovable property purchase enhanced to 250% for non-filers
The government also proposed increase in regulatory duty from zero per cent to 10 per cent on other paper, paperboard, cellulose wadding and webs of cellulose fibers.
Furthermore, the government planned to increase regulatory duty from 10 per cent to 20 per cent on optic fiber cables.
The Finance Bill also proposed amendments in reduction of regulatory duties, which included:
Regulatory duty has been proposed to be reduced as follows:
Case hardening steel from 30 per cent to 20 per cent
Chrome yellow from 15 per cent to 0 per cent
The Finance Bill proposed reduction / concessions in customs duty:
Customs Duty (CD) leviable on the import of following categories of items / sectors is proposed to be exempted for incentivizing the respective sectors:
READ MORE: Pakistan massively increases taxation on motor vehicles
– Machinery and capital goods for mechanization of farming including machinery pertaining to irrigation, drainage, harvesting, plant protection etc.
– Specified raw materials used for manufacturing of LED lights, LED bulbs (including parts thereof) and brush ware.
– 26 Active Pharmaceutical Ingredients for incentivizing Pharmaceutical manufacturers.
– Raw materials for manufacture of first aid bandages.
– Membranes for filtering / purifying water.
– The drug ‘Grafalon’ and gadget ‘Irisvision’.
– Raw materials of Ivy leaves extract powders.
– Motor spirit.
In addition to CD, Additional Customs Duty (ACD) is also proposed to be exempted on import of the following goods:
– Raw materials imported by paper sizing industry and chlorinated paraffin wax industry and manufacturers of aluminum conductor composite cores.
– Stamping foils for manufacturing of optic fiber cables.
– Aluminum paste and powder imported by the Coating industry.
– Guts, bladders and stomachs of animals.
READ MORE: New rates of capital gain tax on disposal of securities
Reduction in Customs Duty and Additional Customs Duty
CD leviable on import of following goods is proposed to be reduced:
– Specified categories of other woven fabrics and artificial flowers / foliage of other materials imported by manufacturers of footwear.
– High-density fiber (HDF) boards of wood or other ligneous materials
– Specified fibers of polypropylene.
In addition to CD, ACD, leviable on import of following goods is also proposed to be reduced:
– Direct and reactive dyes.
– Glycerol crude and Glycerol for the coating industry.
– Goods pertaining to Aluminum, polymers of ethylene, Biaxially Oriented Polypropylene (BOPP) used by the packing industry.
– Adhesive, Epoxide resins, Filter media/ paper, Non-woven fabric media and Steel plates / sheets of prime quality imported by manufacturers of filters, other than automotive.
READ MORE: Pakistan slaps 45% corporate tax on banks
– Organic composite solvents and thinners imported by manufacturers of Dibutyl Orthophthalates.
– Plywood, veneered panels & similar laminated wood, poly (methyl methacrylate) and cyanoacrylate.
– Flavoring powders for food preparation for snacks manufacturers.
ISLAMABAD: The prices of essential items have recorded 28 per cent increase Year on Year (YoY) by week ended June 16, 2022, Pakistan Bureau of Statistics (PBS) said on Friday.
The surge in prices have been seen following the massive increase in prices of petroleum products by the government during last three rounds: first on May 27, 2022; second on June 02, 2022; and the last one on June 15, 2022.
READ MORE: Prices of essential items rise by 20% on first POL rate jump
However, the cumulative effect of inflation is expected to be seen in coming weeks.
The latest Sensitive Price Indicator (SPI) based inflation for the week ended June 16, 2022 has shown massive increase in prices of essential items over the same week last year.
Following are the rates that have witnessed increase during last one year:
READ MORE: Pakistan’s headline inflation up by 13.8% in May 2022
Onions (135.31 per cent), Diesel (132.61 per cent), Tomatoes (117.27 per cent), Petrol (110.16 per cent), Vegetable Ghee 1 Kg (81.76 per cent), Mustard Oil (80.88 per cent), Pulse Masoor (74.77 per cent), Cooking Oil 5 litre (71.52 per cent), Vegetable Ghee 2.5 Kg (68.47 per cent), LPG (60.97 per cent), Garlic (57.72 per cent), Washing Soap (52.73 per cent), Gents Sponge Chappal (52.21 per cent) and Chicken (51.11 per cent).
There are some other essential items that have witnessed decline in prices on YoY basis:
Chillies Powdered (43.42 per cent), Pulse Moong (18.06 per cent), Sugar (10.79 per cent), Electricity charges for Q1 (5.85 per cent) and Gur (3.35 per cent).
READ MORE: Pakistan’s inflation sharply up by 13.4% in April 2022
The comparison of prices of essential items on week on week basis, showed 3.38 per cent.
Increase observed in the prices of food items Chicken (12.10 per cent ), Potatoes (6.89 per cent), Cooked Daal (5.90 per cent), Pulse Gram (5.29 per cent) and Cooked Beef (5.19 per cent),non-food items Diesel (28.91 per cent), Gents Sponge Chappal (26.76 per cent), Gents Sandal (15.40 per cent), Petrol (11.43 per cent), Electricity Charges for Q1 (6.63 per cent) and Cigarettes (6.27 per cent), with joint impact of (2.53 per cent) into the overall SPI for combined group of (3.38 per cent).
On the other hand, decrease observed in the prices of Onions (5.20 per cent), Wheat Flour (2.19 per cent), LPG (1.32 per cent), Bananas (0.83 per cent), Gur (0.45 per cent) and Sugar (0.02 per cent).
READ MORE: Pakistan’s headline inflation increases by 12.7% in March
BERLIN: Pakistan will stay on the grey list despite making compliance to all the action plans set by the Financial Action Task Force (FATF). An onsite visit to Pakistan is required to verify the implementation of the country, a statement issued on Friday by the watchdog said.
However, Pakistan has not been officially removed from the FATF’s grey list.
READ MORE: FATF retains Pakistan in grey list; admits progress
The watchdog said that FATF will “monitor the COVID-19 situation and conduct an on-site visit at the earliest possible date”.
The FATF officials will hold a press briefing shortly on the outcomes of the four-day plenary session of the watchdog that reviewed Pakistan’s action plans.
READ MORE: Pakistan urges FATF to take action against Indian plot
A government official had earlier said in a conversation with the BBC that matters will take seven to eight months to settle even after Pakistan has made its way out of the watch list as the FATF team will visit Pakistan for an inspection.
READ MORE: Pakistan likely to exit from FATF’s grey list
Pakistan had launched a massive diplomatic effort to get off the FATF grey list. Minister of State for Foreign Affairs Hina Rabbani Khar, who is also the chair of Pakistan’s National FATF Coordination Committee, is leading the Pakistan delegation at the plenary meeting that started on June 14, 2022.
KARACHI: Total foreign investment into Pakistan has declined by 59 per cent to $1.59 billion during first 11 months (July – May) of fiscal year 2021/2022, according to data released by the State Bank of Pakistan (SBP) on Friday.
The inflows of foreign investment into the country were $3.85 billion during the corresponding period of the last fiscal year.
READ MORE: Foreign investment falls by 57% in 10MFY22: SBP
Total foreign private investment recorded a 12.5 per cent decline to $1.22 billion during 11 months of the current fiscal year as compared with $1.39 billion in the same months of the last fiscal year.
Foreign Direct Investment (FDI), the major component of the foreign private investment, fell by 5 per cent to $1.68 billion during the months under review as compared with $1.6 billion in the corresponding period of the last fiscal year.
READ MORE: Foreign investment into Pakistan surges by 131%
The portfolio investment, the other component of the foreign private investment, has recorded a fall of 32.3 per cent during the period. The investment in the capital market recorded an outflow of $378 million during July – May 2021/2022 as compared with outflow of $286 million in the same period of the last fiscal year.
READ MORE: Foreign investment surges by 176% during July – January
The inflow in debt securities under foreign public investment was $367 million during first 11 months of the current fiscal year as compared with $2.46 billion in the same months of the last fiscal year.
READ MORE: Pakistan’s foreign investment surges by 73% in 5 months
KARACHI: The official reserves of Pakistan’s central bank have declined to provide about one month import cover, according to official data released on Thursday.
The official foreign exchange reserves of the State Bank of Pakistan (SBP) fell by $241 million to $8.985 billion by week ended June 10, 2022 as compared with $9.226 billion a week ago i.e. June 03, 2022.
READ MORE: SBP’s forex reserves slip 2½-year low to $9.226 billion
The present level of the SBP’s reserves showed that the central bank has import cover for around only one months.
Pakistan’s import bill for the month of May 2022 recorded at $6.777 billion, according to Pakistan Bureau of Statistics (PBS).
The latest foreign exchange reserves of the SBP showed it fell around 2½ years low. Previously, the foreign exchange reserves held by the central bank were seen at $9.233 billion on December 6, 2019.
The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021.
READ MORE: SBP’s forex reserves fall two-year low to $9.72 billion
Since touching the peak the central bank’s foreign exchange witnessed a continuous decline. The official reserves of the SBP fell around $11.16 billion by week ended June 10, 2022 from touching the peak on August 27, 2021.
The country is facing serious balance of payment crisis during the past many months. The foreign exchange reserves of the central bank have seen a constant decline.
The falling foreign exchange reserves also put pressure on the local currency. The Pakistani Rupee (PKR) is also depreciating to record low against the US dollar on daily basis.
The rupee fell to a fresh historic low at Rs207.67 to the dollar at interbank foreign exchange closing on June 16, 2022.
READ MORE: Moody’s changes Pakistan’s outlook to negative
The country was expecting inflows from various sources but so far those were not materialized so far. The country also making all efforts to resume IMF program to obtain about $ 1 billion next tranche under Extended Fund Facility (EFF).
The total foreign exchange reserves of Pakistan have declined to around three-year low at $14.94 billion by week ended June 10, 2022. Previously, the foreign exchange reserves of the country were seen at $14.86 billion by week ended July 19, 2019.
The country’s foreign exchange reserves have fallen by $233 million to $14.943 billion by week ended June 10, 2022 as compared with $15.176 billion a week ago i.e. June 03, 2022.
READ MORE: Pakistan’s headline inflation up by 13.8% in May 2022
The country’s foreign exchange reserves hit all-time high of $27.228 billion on August 27, 2021. Since then the foreign exchange reserves have declined by $12.285 billion.
The foreign exchange held by commercial banks however slightly up by $8 million to $5.958 billion by week ended June 10, 2022 as compared with $9.226 billion a week ago.
LAHORE: Punjab government on Wednesday presented its budget 2022/2023 with an outlay of Rs3.226 trillion. Presenting the budget, Finance Minister, Sardar Owais Ahmad Khan Leghari said the total volume of the budget is 22 percent more than current fiscal year, out of which Rs1.712 billion have been allocated for Current Expenditures.
He said that total estimated Revenue for next fiscal year is 2521.29 billion rupees, while the province will get over 2020 billion rupees from the Federal Divisible Pool.
The Minister said Rs435.87 billion have been allocated for salaries, Rs312 billion for pensions while Rs528 billion for Local Governments.
The Finance Minister said no new tax has been levied in next fiscal year on account of Sales Tax on Services. He said Stamp Duty ratio has been proposed to enhance from current one percent to 2 percent to raise provincial revenue.
Owais Leghari said 35 percent of the Annual Development Program amounting to 240 billion rupees has been allocated for South Punjab, which will be spent on development projects.
ISLAMABAD: Indonesia has started palm oil shipment to Pakistan after promulgation of new export regulation, a statement said on Tuesday.
On the request of Pakistan, Indonesian minister assured that after completing the necessary formalities, the first shipment of palm oil to Pakistan was expected to sail within 24 hours.
The minister further stated that he would ensure that the first shipment leaves the Indonesian port by the next day. The minister also assured that Pakistan would be the first country to which the commodity will be exported, after the promulgation of new export regulations.
READ MORE: Tarin orders release refunds to edible oil importers
Upon the special instruction of Prime Minister Muhammad Shehbaz Sharif, Federal Minister for Industries and Production Makhdoom Syed Murtaza Mahmud led a delegation to Jakarta from 12- 14 June 2022.
The objective of the visit was to minimize the impact of the recent decision of the Government of Indonesia to ban the export of Palm oil on Pakistan’s economy and ensure the steady flow of the commodity in the Pakistani market, Pakistan is the third-largest importer of Indonesian Palm Oil.
In 2021, Pakistan had imported 2.78 million tonnes of Palm oil from Indonesia. During the visit, Minister Syed Murtaza Mahmud met with the Indonesian Minister of Trade Muhammad Lutfi, Minister of Industry Agus Gumiwang Kartasasmita Coordinating Minister of Maritime and Investment Affairs, Luhut Binsar Panjaitan, and Minister of Industries, Agus Gumiwang Kartasasmita.
Representatives of the largest Palm oil exporters to Pakistan and the Chairman of the Indonesian Palm Oil Association also called on the Minister.
In his interaction with the Indonesian Minister of Trade, while highlighting the strong historical and brotherly relations between Pakistan and Indonesia, Minister Mahmud underscored that Pakistan, being the third – largest market for Indonesian palm oil, was heavily dependent on Indonesian palm oil.
He sensitized the Indonesian minister of the situation of edible oil in Pakistan and mentioned that Indonesia’s decision to ban palm oil export for a month had adversely affected the stocks of edible oil in Pakistan. Even after the ban had been lifted on 23 May 2022, the exporters are still facing regulatory and logistical bottlenecks.
He urged his Indonesian interlocutor to facilitate the earliest possible resumption of palm oil shipments to Pakistan by removing the bottlenecks.
In response, the Indonesian Minister assured that Indonesia attached great importance to its relations with Pakistan and was ready to ensure an uninterrupted flow of Indonesian Palm Oil to Pakistan.
He further stated that after completing the necessary formalities, the first shipment of palm oil to Pakistan was expected to sail within 24 hours.
The Minister further stated that he would ensure that the first shipment leaves the Indonesian port by the next day.
The Minister also assured that Pakistan would be the first country to which the commodity will be exported, after the promulgation of new export regulations.
Both the ministers discussed bilateral economic and trade relations. Minister Mahmud underscored the urgency of bridging the huge trade imbalance between the two countries.
The two Ministers identified SMEs, agriculture, tourism, industrial joint ventures, and other non – traditional sectors as possible areas of collaboration.
Minister Lutfi agreed to visit Pakistan to discuss these issues with his Pakistani counterpart. During his meeting with Coordination Minister Luhut Binsar Panjaitan who has been assigned by President Jokowi to coordinate local distribution and export of Palm oil, Minister Mahmad underscored the need to ensure uninterrupted delivery of the commodity to Pakistan.
Minister Luhut promised to make sure that the delivery of Palm Oil to Pakistan in resumed at the earliest. He further stated that he has directed to ensure steady flow to the commodity in the future.
Minister Mahmud and his Indonesian counterpart, Agus Chumiwang Kartasasmita exchanged views on bilateral cooperation in the industrial sectors, particularly in the production of e-vehicles, cell phones, electronics, and agro – based Industries.
The Minister highlighted the potential of investment in Pakistan in various sectors, and opportunities emerging from SEZa and invited the Indonesian businessmen and entrepreneurs to invest in Pakistan.
The Minister also invited his Indonesian counterpart to visit Pakistan, which was accepted.
The visit of Minister Mahmud was timely to secure the resumption of the export of Indonesian Palm Oil to Pakistan and avoid a shortage of the commodity in the market.
Due to the Minister’s personal intervention, two shipments of Palm Oil carrying 30,000 and 27,000 would leave for Pakistan today.
Another 8 shipments are expected to reach Karachi before the end of June 2022 14 June 2022, says a press released received here today from Jakarta on 14 June 2022.