KARACHI: Restrictions imposed on opening of Letter of Credit (LC) for import payment have given massive rise to smuggling of automobile spare parts.
(more…)Category: Ports and Shipping
-
KCCI urges shipping lines, terminal operators to waive detention, demurrage charges
Karachi Chamber of Commerce and Industry (KCCI) on Saturday urged shipping lines and terminal operators to waive demurrage and detention charges to stuck-up containers at ports.
(more…) -
SBP amends QCR rating criteria for certifying remittance verification
KARACHI: State Bank of Pakistan (SBP) has amended Quality Control Review (QCR) criteria of accountancy firm regarding certification of remittance verification.
(more…) -
KCCI hails decision to waive demurrage, port charges
Karachi Chamber of Commerce and Industry (KCCI) on Tuesday appreciated the government decision to waive demurrage and port charges on all stuck up containers.
(more…) -
Pakistan waives port charges for stuck up containers for non-opening LCs
KARACHI: Pakistan has waived demurrage and detention charges for stuck containers at ports due to non-opening of letter of credits (LCs), a senior minister announced on Monday.
(more…) -
PNSC recommends tax incentives for shipping industry to grow
Pakistan National Shipping Corporation (PNSC) has emphasized the need to introduce tax incentives to help shipping industry to grow.
In an analyst briefing a day earlier, the company emphasized the need to introduce tax incentive measures to flourish the shipping industry which will minimize outflow of valuable national foreign reserves.
According to Insight Research, PNSC held its analyst briefing to comment on its financial result of fiscal year 2021/2022 and to shed some light on company’s future outlook. Major highlights of the session are given below:
PNSC has posted topline of PKR28 billion in FY22, up by 117 per cent as compared to same period last year (SPLY). Whereas profit after tax (PAT) stood at PKR5.7 billion (EPS: PKR42.75) vs. PKR2.3 million (EPS: PKR17.14) in SPLY. Where in 1QFY23, company has posted PAT of PKR 5.3 billion (EPS: PKR40.80), up by 8.5x YoY.
Gross margins of the company increased to 29 per cent in FY22 from 22 per cent in FY21 due to higher crude oil freight rates. Similarly, net margins increased to 20 per cent in FY22 from 18 per cent in SPLY.
Company’s current deadweight tonnage capacity reached to 1.05 million tons which is highest ever in its inventory. To highlight, company has recently added 2 vessels (Aframax tankers) in August 2022 with a combined capacity of 0.21 million.
Company’s current fleet strength comprise of 13 vessels, out of which 8 are oil tankers and 5 are bulk carriers.
Company is considering different options i.e by selling in scrap or dry docking or using as a storage terminal to dispose their 3 old vessels.
As per management, average life of the ship is 20 years based on cost effectiveness. However, using a ship higher than this age will normally increase the maintenance cost for the company.
Global oil freight charges are on the rising trend due to EU sanctions against Russian crude and refined oil product imports which will likely result in increased profitability for the company in coming quarter.
Company is further planning to add Afra max tanker, IMO type-II tanker and Ultra max bulk carrier in their fleet and estimated cost for adding these vessels are $150 million on current levels.
While commentating on company’s plan to diversify its operations, company is planning to enter new markets including Edible oil transportation which is currently being imported on CFR basis.
-
Sindh exempts sales tax on services provides for floods relief by customs agents, port operators
The Sindh government has taken a significant step in supporting flood relief operations by exempting sales tax on services provided by customs agents and terminal operators.
(more…) -
ECC approves clearance of banned items landed till August 18, 2022
ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Wednesday approved the customs clearance of banned items, which landed till August 18, 2022.
Federal Minister for Finance and Revenue Miftah Ismail virtually presided over the meeting of the ECC. Federal Minister for Commerce Syed Naveed Qamar, Federal Minister for Power Khurram Dastgir Khan, Federal Minister for Industries and Production Makhdoom Syed Murtaza Mehmmod, Federal Minister for National Health Services, Regulations and Coordination Abdul Qadir Patel, MNA/ex-PM Shahid Khaqan Abbasi, Minister of State for Finance and Revenue Dr. Aisha Ghous Pasha, Coordinator to the PM on Economy Bilal Azhar Kayani, Chairman NDMA, Chairman FBR, Federal Secretaries and senior officers attended the meeting.
READ MORE: USC to disburse ration bags worth Rs540 million to flood victims
The ECC considered a summary of Ministry of Commerce on clearance of stuck up consignments in light of office memorandum dated 22 July, 2022, 19 August, 2022 and 23 August, 2022 issued by Ministry of Commerce.
The ECC approved the proposal and directed that the consignments of previously banned items that landed in Pakistan till August 18, 2022 may be released at the rate of surcharge.
Ministry of National Health Services, Regulations and Coordination presented a summary for exemption of Active Pharmaceutical Ingredients (APIs) from Custom Duty and Additional Custom Duty.
READ MORE: Pakistan State Oil gets Rs30 billion to avoid default
The ECC after discussion directed Ministry of National Health Services, Regulations and Coordination to withdraw the summary and submit a fresh summary to rationalize price of paracetamol to ensure its availability.
The summary presented by Ministry of National Food Security and Research regarding import of Wheat through Gwadar sea port was deferred by ECC.
National Disaster Management Authority (NDMA) presented a summary for allocation of funds for procurement and logistics of relief items for flood affectees and apprised about devastation caused by the recent floods in Pakistan. In order to provide immediate relief to the flood affectees, NDMA started procurement on emergency basis costing Rs. 2.4 billion.
READ MORE: Pakistan decides to lift ban on imported goods
Due to colossal damages, the already procured items are not sufficient viz-a-viz relief requirement in the flood affected areas.
Therefore, NDMA placed orders for procurement of more items at cumulative cost of Rs. 7.113 billion, which are being procured in emergency to provide relief to affectees. Previously, NDMA was allocated Rs. 8 billion for procurement and logistics cost of relief items to the flood affectees.
READ MORE: 15% surcharge imposed for clearance of banned items
The amount was insufficient as the cost of only procurement has surpassed Rs. 9.5 billion. Besides procurement, NDMA is also undertaking logistics of all relief goods and materials provided by friendly countries.
Foregoing in view, the ECC approved allocation of Rs. 10 billion to National Disaster Management Authority (NDMA) with direction to the Finance Division to immediately release Rs. 5 billion to NDMA.
-
Industry slams finance ministry for blocking letter of credit
KARACHI: The industry has strongly criticized the ministry of finance for directing banks not to open letters of credit for essential machinery, equipment and spare parts.
“Pakistan’s industrial sector is gradually heading towards doldrums because of the adamant attitude of Ministries of Finance and Commerce to block banks from opening Letters of Credit or remitting advance payments for imports of essential machinery, equipment and spare parts,” this was stated on Tuesday in a press statement by Ismail Suttar, President Employer’s Federation of Pakistan.
READ MORE: Clearance of banned cars, phones allowed on 100% surcharge
Ismail Suttar further said that such blanket refusal under HS 84 and 85, which are for imports of machinery, spare parts, electrical and electronic equipment, vehicle CBUs and CKDs, and other essential items, is detrimental to the functioning of any industry, especially when a particular item is not manufactured in Pakistan.
EFP, which is the apex body of industries, is daily receiving frantic messages from member companies who are unable to maintain their production or adhere to delivery schedules. Moreover, a decrease in production eventually increases the cost of the product.
READ MORE: Pakistan lifts ban on import of cars, phones, luxury items
EFP President added that the industrialists fully understand the compulsions under which this embargo has been instituted but the government has to be pragmatic in its policies and must take cognizance of the ground realities. He advised the Ministers of Finance and Commerce to take private sector into confidence regarding the time frame of this embargo.
READ MORE: 15% surcharge imposed for clearance of banned items
Ismail Suttar also said that EFP has information that over 6,000 applications are pending before the SBP and this figure is not only mind-boggling but also a manifestation of the economic crisis faced by the country. The policy of refusal is negatively impacting on exports as well as affecting industries that are playing a prominent role in import substitution.
He added that the recent catastrophic floods have further compounded the already dire straits through which the industries are facing. He said his message is quite clear. Save industries before they close down and retrench workers thus creating a major social crisis.
READ MORE: SBP assures allowing stuck up containers of banned import
-
Karachi Port mulls to determine demurrage charges
KARACHI: Syed Muhammad Tariq Huda, Chairman, Karachi Port Trust has said that the port is considering to establish a regulator body to determine demurrage charges at the port.
The formation of regulatory body will be announced soon, he said in his address at a meeting held at Korangi Association of Trade and Industry (KATI).
On this occasion, KATI Patron-in-Chief SM Muneer, President Salman Aslam, Senator Abdul Haseeb Khan, KITE CEO Zubair Chhaya, Senior Vice President Maheen Salman, Vice President Farrukh Qandhari, Standing Committee Chairman Faraz-ur-Rehman, Former Presidents, Farhan-ur-Rehman, Masood Naqi, Danish Khan, Manzar Alam, Farrukh Mazhar and others were also present.
READ MORE: KATI flays imposition of new taxes
Chairman KPT Tariq Huda further said that I am trying to reduce the demurrage charges but due to some unavoidable reasons this issue is delayed, in a few days I will invite all the business community to the KPT head office where it will be formally announced.
He said that due to the recent change in the import policy, all the containers were stopped at the port, which has now been allowed to leave, due to which the demurrage charges were incurred.
Tariq Huda said that since 2002 no charges have been increased by KPT. However, employee salaries and other administrative expenses increased.
This is the reason why now the operating profit and revenue are equal, in the past KPT’s profit was high, many development projects were completed by KPT’s expenses including KPT flyover, underpass and other projects.
However, due to a lack of budget, it is difficult to bear the expenses of development projects. Now is the time to take concrete steps to increase the income of KPT.
Chairman KPT said that we will start Pakistan’s single window operation which will provide facilities to importers and exporters. Tariq Huda said that we should use our marine resources.
In this regard, if the business community under the leadership of SM Muneer presents its suggestions, I will provide all possible support. He said that if the Pipri railway track is completed, 100 containers can be cleared from the port immediately.
Apart from this, the elimination of marine pollution also becomes our responsibility to take all possible measures. We are throwing 8000 tons of garbage in the sea every day which has increased the pollution. We must immediately step up efforts to boost infrastructure and commercial activities. KPT will soon launch an awareness campaign to prevent environmental pollution.
On this occasion, KATI Patron-in-Chief SM Muneer said that corruption is spreading rapidly in the country. The country is currently going through an economic crisis, 90% of the industry has closed in Faisalabad, in such a situation we have to improve the economy.
He said that floods have created havoc in the country at this time, in such a situation negative campaigns against Pakistan Army on social media are condemnable. SM Muneer said that the Army Chief keeps a close eye on the economy. The most corrupt officer in the country is appointed as Water Board Chairman.
Despite the filling of dams across the country, the water board continues to cut off water. Chief Patron KATI said that fisheries have an export value of 450 million rupees, but the road and infrastructure there are in a state of disrepair. In connection with KATI’s initiative to help the flood victims, I salute Salman Aslam who took immediate relief measures.
President Salman Aslam said that KATI is the first organization that took practical steps to help the flood victims. I have taken the first aid consignment of 5 trucks under my leadership, and I will prepare the second consignment soon.
He said that KATI also announced 50 lakh rupees for the relief of flood victims. President KATI said that the local industry is facing difficulties due to the global crisis. Severe inflation has broken the backbone of the common man.
The cost of production is threatening to bankrupt industries, while port demurrage charges and other payments are adding to the cost of doing business which manufacturers cannot afford.
Senator Abdul Haseeb Khan said that Tariq Huda is an experienced person, and it is hoped that he will solve the problems of the industrialists by taking a personal interest.
He said that we import raw materials and export them later, if time is saved, it can be done better. Exporters have been hit hard by the additional costs of demurrage and detention charges.
Zubair Chhaya, CEO of KITE Limited, said that KPT’s performance is continuously improving. The infrastructure we go through is appalling. There are no corridors to go from the industrial area to the port while Korangi, SITE, Federal B Area, Landhi, and North Karachi industrial areas are the backbone of the country but they are being crippled by destroying the infrastructure.
KPT should start a ferry service for citizens of Karachi to increase revenue.
Chairman of the Standing Committee Faraz-ur-Rehman said that steps should be taken to improve freight charges, and a separate authority should be formed for KPT on the pattern of the Drug Regulatory Authority to decide the issues of demurrages and detention.
He said that operating companies are collecting demurrage charges arbitrarily due to which importers and exporters are facing difficulties.