Thursday, news August 07, 2014 updates - …imranghazi.com/mtba/downloads/News/2014/News 07 Aug 2014 Email No...... 10 Lahori Group' calling the shots at Prime Minister's office

`

news updates

Thursday, August 07, 2014

Office # 05, Ground Floor, Arshad Mansion, Near Chowk A.G Office, Nabha Road Lahore. Ph. 042-37350473 Cell # 0300-8848226

Mail to: [email protected], [email protected]

NEWS OF THE DAY

mailto:[email protected]

mailto:[email protected]

PLP NEWS ALERTS EMAIL No. 179-2014

BACK TO HEADLINES Page 2

NEWS HEADLINES Top Stories ................................................................................................................................................... 6

Assessments by IMF not always correct: minister ........................................................................................ 6

Planning Commission inducts seven members, chief economist ................................................................. 6

Politicians huddle together to conjure up solution ...................................................................................... 8

Dar elected chairman of electoral reforms body .......................................................................................... 9

Zardari phones PAT chief ............................................................................................................................ 10

Prime Minister meets Ijaz, Sajid and FATA leader ...................................................................................... 10

Lahori Group' calling the shots at Prime Minister's office .......................................................................... 11

Israel 'ready to extend Gaza truce unconditionally' ................................................................................... 12

First-year performance: Dar struggles to articulate upbeat economic view .............................................. 13

Forex regulations: bill tabled to strengthen SBP powers ........................................................................... 13

UN pledges to rebuild Gaza for 'last time' .................................................................................................. 16

StanChart faces new US money-laundering investigation .......................................................................... 17

Rangers arrest Indian soldier ...................................................................................................................... 18

Qadri's men asked to make payment of Rs 350 million: FBR issues notice ................................................ 18

Remaining 3G/4G licences: government to seek EoIs from CMOs next week ........................................... 19

US drone strike kills seven in North Waziristan .......................................................................................... 20

Article 245: IHC judge seeks formation of larger bench ............................................................................. 21

PAC decides to send AGP's case to SJC ....................................................................................................... 22

THE RUPEE: stable trend ............................................................................................................................. 23

Treason trial: Court urged to take record of case into custody .................................................................. 24

Putin hits back with ban on food from sanction nations ............................................................................ 25

Probe makes space history with rendezvous with comet .......................................................................... 26

Hiroshima marks anniversary of atomic bombing ...................................................................................... 26

WHO calls ethics meeting over experimental Ebola drug .......................................................................... 27

Clarification ................................................................................................................................................. 27

Panic selling pushes down index ................................................................................................................. 28

BRIndex30 sheds 161.75 points .................................................................................................................. 29

Business and Economy: Pakistan ............................................................................................................. 30

Japanese firm to set up IT, engineering units worth $300 million in Dhabeji ............................................ 30

Forex regulations: bill tabled to strengthen SBP powers ........................................................................... 31

French CG for exchange of more business delegations .............................................................................. 32

Significant potential for Pak-Lanka bilateral trade: Prime Minister tells Kshenuka ................................... 33



Pakistan, Sri Lanka agree to consolidate ties .............................................................................................. 33

Economic growth, jobs: public, private sectors should join hands: PIAF ................................................... 35

Social impact training: Acumen seeking applications for Pak Fellows Programme ................................... 35

Planning Commission inducts seven members, chief economist ............................................................... 36

Clarification ................................................................................................................................................. 38

LCCI, CCPIT CHEM ink MoU ......................................................................................................................... 38

HCCI lauds government's economic policy ................................................................................................. 39

Surgical instruments exports fetch $1.35 billion in five years .................................................................... 40

Prime Minister to open rehabilitated Ziarat Residency on August 12........................................................ 40

Activities at Karachi and Qasim ports ......................................................................................................... 41

Commissioner Multan reviews metro bus service project: report to be submitted to chief minister tomorrow .................................................................................................................................................... 42

20 locomotives to be inducted into Railways' fleet soon ........................................................................... 43

Thatta-Sujjawal Bridge: Commissioner asks officials to accelerate pace of repair work ........................... 43

North section: non-availability of ROW hinders work on Lyari Expressway ............................................... 44

PAC decides to send AGP''s case to SJC ...................................................................................................... 45

Preparations for IDEAS-2014 in full swing .................................................................................................. 46

Company News: Pakistan ......................................................................................................................... 47

UBL posts Rs 10.5 billion profit in first half 2014 ........................................................................................ 47

Abbott Pakistan ........................................................................................................................................... 47

Cotton and Textiles: Pakistan .................................................................................................................. 50

Cotton market: trading activity gains momentum ..................................................................................... 50

CCMG urges growers to adopt measures to tackle pest attack ................................................................. 51

Taxation: Pakistan .................................................................................................................................... 52

FBR agrees to discuss 13 major issues with Aptma .................................................................................... 52

Budgetary taxation measures: Monthly ST returns to reveal actual impact .............................................. 53

Probe into VAS scam may be transferred to NAB ....................................................................................... 54

Taxation: World ......................................................................................................................................... 55

German SPD leader says tax anomaly can be eliminated before 2017 ...................................................... 55

Agriculture and Allied: Pakistan ............................................................................................................. 56

Daily trading report of PMEX ...................................................................................................................... 56

PLDDD to vaccinate 22.02 million animals till September .......................................................................... 56

Non-availability of scientific research dims future fishing prospects ......................................................... 56

Fuel and Energy: Pakistan ....................................................................................................................... 58

LNG import scheduled for March 2015, National Assembly told ............................................................... 58



Abid Sher concerned over politics of discord ............................................................................................. 59

PTI chief to inaugurate hydropower project today in Swat ........................................................................ 59

August 10 to 14th: government decides to cut loadshedding duration ..................................................... 59

Minister inaugurates 500kv DG Khan Grid Station ..................................................................................... 60

Fuel and Energy: World ............................................................................................................................ 61

Russia and Iran set oil-for-goods contract talks .......................................................................................... 61

Brent up on geopolitical worry, US crude falls ........................................................................................... 62

US natural gas futures rise 1.6 percent....................................................................................................... 63

Banking & Finance ................................................................................................................................... 64

SBP sells Rs 86,893.509 MTBs ..................................................................................................................... 64

BR Research: All ....................................................................................................................................... 65

What will Nawaz do? .................................................................................................................................. 65

Where PIBs come first ................................................................................................................................. 68

EPCL: margins leap backwards .................................................................................................................... 69

Crime Updates ........................................................................................................................................... 70

Bahawalpur: 2 women terrorists held, explosives recovered .................................................................... 70

Quetta: 11 Afghans held under Foreign Act ............................................................................................... 70

Islamabad: NAB arrests contractor for fraud of Rs73.6m ........................................................................... 70

Suspects arrested in Peshawar ................................................................................................................... 71

Karachi: Arrested target killer confesses of murdering 23 people ............................................................. 71

Chakwal: 2 arrested recovered illegal weapon and liquor ......................................................................... 71

Maintaining security: Remote-control bomb dismantled .......................................................................... 71

Law and order: Man shot and injured in mugging ...................................................................................... 72

Crime scene evidence uploaded to database ............................................................................................. 72

Miscellaneous News .................................................................................................................................. 74

IDEAS-2014: Preparations get under way ................................................................................................... 74

Threat to business: Peaceful solutions required, says FPCCI president ..................................................... 74

New health projects: Equipment purchase for WIC starts ......................................................................... 75

Petroleum products: PSO willing to buy but won’t heed to Byco’s condition ........................................... 76

Islamic finance: SBP’s 5-year plan will drive asset growth, says Moody’s official ...................................... 77

Preferential trade: Turkey ready to sign PTA, blames Pakistan for delay .................................................. 79

Troubled bank gets last chance to increase capital .................................................................................... 80

Corporate results: Engro Polymer’s earnings slump................................................................................... 81

OPEN MARKET FOREX RATES ...................................................................................................................... 83

INTER BANK RATES ...................................................................................................................................... 84



Bullion Rates (Gold Prices) in Pakistan Rupee (PKR) ................................................................................... 85



Top Stories

Assessments by IMF not always correct: minister August 07, 2014

Finance Minister Ishaq Dar on Wednesday said that International Monetary Fund (IMF) assessments do not always prove accurate. Addressing a press conference here on Wednesday, he said, for example, IMF projection was that Pakistan rupee would depreciate to Rs 114 against US dollar in 2013-14 a forecast which later proved to be inaccurate. The Minister added that the country's currency would have further strengthened if the regulator had not played a role due to an adverse impact on exports. The Finance Minister said the country's economic decisions can not be taken on the wishes of those "making analyses and assessments from Washington and Lahore." The Finance Minister further added inflation was projected at 12 per cent and GDP at 2.9 per cent by the IMF for last fiscal year and the Fund had to revisit its assessments about inflation and GDP. He said that the assessment that country's foreign exchange reserves have improved due to $1.5 billion inflows from Saudi Arabia and $2 billion Eurobond was true.

Copyright Business Recorder, 2014

Planning Commission inducts seven members, chief economist August 07, 2014

Planning Commission of Pakistan, in light of its new mandate and role, has inducted seven members and a chief economist from the leading private/academic sector organisations after approval from the prime minister on merit and following all prescribed procedures. Nadeem Javed has been hired as chief economist, who holds a Ph.D in Economics from France and has an extensive experience in economic and finance sector. Previously, he has worked as the Director of Karachi School of Business & Leadership (KSBL) and has taught macroeconomy and global economy at several universities, including LUMS and SKEMA Business School, France. He has been a member of working group on regulatory reforms at the Ministry of Finance, and has also worked at State Bank of Pakistan. Malik Ahmad Khan has been selected as Member Infrastructure and Regional Connectivity, who holds a degree in civil/environmental engineering from SEAS at the George Washington University and an MBA from the Said Business School at the University of Oxford where he was on a Professional Management Scholarship at Green Templeton College.



He has a career spanning over 15 years and has served world's most admired corporations and public sector organisations, including 10 of the Fortune 50, McKinsey and Company, Standard Life Capital Partners, Fidelity Investments, Acumen, the City of Toronto, various agencies of the government of Pakistan and a variety of global multi-lateral organisations. Ahmad is on the advocacy boards of the Saïd Business School, University of Oxford as well as being an advisor to Acumen Pakistan. Dr Syed Tahir Hijazi has been hired as Member Governance, who holds a Ph.D in Development Economics from Clark University, USA. Dr Hijazi has a professional career of more than 36 years and has served in many educational institutions including University of Central Punjab, International Islamic University, American College of Greece Athens in various capacities such as Pro-Rector and Professor. He has also served UNDP and Government of Pakistan earlier and published extensively in the area of governance. Dr Naeem uz Zafar is selected as Member Social Sector. Dr Zafar holds a Ph.D in Economics from Northern Illinois University, USA and MBA (Finance) from IBA Karachi. He has extensive teaching and research experience of economics and social policy. He has held various teaching and administrative positions in top business schools of Pakistan. Prior to career of economics, he held various technical positions in manufacturing and power plant industries in Pakistan. Professor Dr Muhammad Yahya Khawaja is hired as Member Information Technology & Science and Technology. Dr Khawaja has Ph.D in Information Management System and Masters in Computer Engineering from University of Missouri-Rolla, USA. He is a versatile engineer and project manager with considerable international exposure and established work history in North America and Pakistan to deliver products and services in the realm of Science and Information Technology, business and engineering bases of knowledge. He is an effective technology trainer with teaching and research experience in Pakistan, Canada and USA. Dr Yahya has authored and co-authored over 70 research publications and supervised graduate students at both MS and PhD level. Muhammad Shahid Chaudhry, selected as Member Implementation and Monitoring, has an MSc in Industrial Engineering from Mississippi State University, USA and BSc Chemical Engineering from UET, Lahore. He is a Member of American Institute of Industrial Engineering and has an extensive experience in planning, monitoring and execution of projects. He has previously worked in monitoring and evaluation departments of organisations like Descon, SMEDA, Berger, KFC, Dow Hercules and the World Bank. Ayesha Javed Eirabie will be rendering her services as Member Development Communications in the Planning Ministry. She brings rich background from corporate sector. She has previously worked as Executive Vice President (Marketing and Communications) PTCL and also served other organisations including KESC, American Business Council, Pakistan Cricket Board and Daily Times. She has an MBA from Imperial College, London. Akhtar Ali, Member Energy, is an eminent energy expert and has authored a number of books on energy policy, investments and tariff issues. He is a visiting Professor of Energy at IoBM and teaches energy management. He was also a Research Fellow Energy at Harvard University's Kennedy School of Government. Besides academic sector, he has also worked as a Chief Executive Officer of Proplan Associates; Managing Director, Karachi Pipe Mills; General



Manager, Heavy Mechanical Complex and several other organisations. He has an MS degree from METU Turkey, and BE from NED, Karachi. Breaking the past tradition of appointing retired officials, the new recruitments have been made by attracting quality talent from top academic and corporate institutions of the country in line with the new vision to transform Planning Commission into a development think-tank.-PR


Politicians huddle together to conjure up solution August 07, 2014

Pakistan People's Party and Jamaat-i-Islami on Wednesday appealed to Pakistan Muslim League - Nawaz (PML-N) and Pakistan Tehreek-i-Insaf (PTI) to reduce friction and try to reach an agreement. In a joint press conference held after a meeting between Pakistan People's Party (PPP) member Khursheed Shah and Jamaat-i-Islami (JI) chief Sirajul Haq, both leaders said they want to play a role in lowering political temperatures. The meeting, held at JI leader Mian Aslam's residence, was joined by PPP's Leader of the Opposition in National Assembly, Syed Khurshid Shah, Qamar Zaman Kaira, JI chief Siraj-ul-Haq, Liaqat Baloch and Mian Aslam. "We all agreed on the supremacy of law and constitution. We have discussed Imran Khan's march and will also contact other political forces to improve the situation," said Shah while speaking to media persons after the meeting. Shah said Prime Minister Nawaz Sharif's resignation, demanded by Imran Khan, "is no solution to the problem." Replying to a question regarding possibility of 'hidden hands' behind Khan's campaign, Shah said "no such hands can interfere if politicians demonstrated unity within their ranks." Siraj-ul-Haq said that his party was playing its role to de-escalate the prevailing political tension. "We discussed political situation today, especially Imran Khan's rally; we have underscored the need that we should play our role rather than acting like a silent spectator... We think that holding protests and is a legal and constitutional right of every political party but politics also requires a flexible attitude," he said. Haq said former president Asif Ali Zardari also telephoned him and discussed fresh confrontation between political parties. "He was of the view that no chaos should take place, and I think that Imran Khan doesn't wish to undermine democracy through such steps." Replying to a query regarding Speaker National Assembly's resignation, he said "we don't seek anyone's sacrifice for now, but instead government's committee for electoral reforms should lay down a practical programme before the nation." Khurshid Shah also urged the reforms committee to find a constitutional way out to meet Opposition's demands.

Copyright Independent News Pakistan, 2014



Dar elected chairman of electoral reforms body August 07, 2014

Finance Minister Muhammad Ishaq Dar was elected unopposed as chairman of the 33-member Special Parliamentary Committee on Electoral Reforms. Dar was elected chairman of the special body in its first meeting held here on Wednesday at Parliament's House. Now, terms of reference of the committee will be formulated for smooth functioning of the body. Speaker National Assembly Sardar Ayaz Saddiq had constituted the committee on July 25, and assigned it the task to "evaluate the shortcomings of the previous electoral process and make recommendations to hold free, fair and transparent elections in the country in future." The committee represented all ruling and opposition parties having representation in the Parliament. Finance Minister Ishaq Dar is a key member of the ruling Pakistan Muslim League-Nawaz (PML-N) and considered very close to Prime Minister Nawaz Sharif. Pakistan Tehreek-e-Insaf (PTI), which is gearing up for its scheduled 'Azadi March' on Islamabad on August 14 to protest against the alleged riggings in the 2013 general elections and demand mid-term elections in the country has also nominated three members in the committee- Shafqat Mehmood, Dr Shireen Mazari and Dr Arif Alvi. Meanwhile, a handout issued by the National Assembly Secretariat said that the Special Committee of the Parliament on Electoral Reforms unanimously elected Senator Mohammad Ishaq Dar as its chairman. The Committee met on Wednesday at the Constitution Room, Parliament House Islamabad. Earlier, while chairing the meeting, Senator Mohammad Ishaq Dar expressed his gratitude to the Committee members for reposing confidence in him and assured that he would take along this august committee by taking decision with consensus. "This committee would work bi-partisan and play proactive role to complete the task within given timelines," he added. The Minister said that the representation of all the parliamentary parties in the committee showed government's resolve to frame electoral reforms; from where the coming generations would get tremendous benefit in terms of political consciousness, social change and economic prosperity. He also outlined a future sketch in relation to Committee's working ie drafting of Rules of Business, review/re-visit of existing electoral laws and proposals finalised by the former relevant Committee of the Senate and National Assembly of Pakistan. Congratulating the newly-elected chairman, members of the committee extended their full co-operation in completing this crucial task; as the whole nation is expecting from this Committee with respect to free, fair and transparent electoral. This is now our national responsibility to establish such an electoral system which would be undisputed and acceptable to all the stakeholders, they added. The committee decided to circulate a report prepared by former Senate Committee on Electoral Reforms amongst its Members as a working paper; which would be discussed in a committee meeting to be held on August 11, 2014, at 11:00 am in constitution Room of the Parliament House.



The meeting was attended by Zahid Hamid, Federal Minister for Science and Technology, Lieutenant General Abdul Qadir Baloch (Retd), Federal Minister for Safron, Deputy Speaker, National Assembly, Anusha Rehman Khan Advocate, Minister of State for IT, Abdul Rahim Mandokhail, Naeema Kishwar Khan, Ghous Bux Khan Mahar, Syed Ghazi Gulab Jamal, Aftab Ahmad Khan Sherpao, Muhammad Ejaz-ul-Haq, Sheikh Rashid Ahmed, Syed Naveed Qamar, Shazia Marri, Shafqat Mehmood, Dr Shireen Mehrunnisa Mazari, Dr Arif Alvi, MNAs; besides Senator Malik Muhammad Rafique Rajwana, Senator Mian Raza Rabbani, Senator Muhammad Talha Mehmood and Senator Mushahid Hussain Sayed. The meeting was also attended by senior officials of the National Assembly Secretariat. Meanwhile, Sardar Ayaz Sadiq, Speaker and Murtaza Javed Abbasi, Deputy Speaker, National Assembly, congratulated Senator Muhammad Ishaq Dar on his unopposed election as Chairman of the Committee. In their separate congratulatory message to Muhammad Ishaq Dar, the Speaker and Deputy Speaker extended their warm felicitations on his election as Chairman, Special Committee on Electoral Reforms. They said that his unopposed election as Chairman was an evidence of trust and confidence of leadership of all the political parties sitting in the Parliament and members of the Committee reposed in his capabilities.


Zardari phones PAT chief August 07, 2014

PPP Co Chairman former President Asif Ali Zardari Wednesday evening called Pakistan Awami Tehreek chief Dr Tahirul Qadri from London and exchanged views with him on current political situation in the country. Spokesperson Senator Farhatullah Babar said that while talking to Dr Qadri, the former President said that in last government there was not a single political prisoner nor any case registered against any political leader and "that's what we called democracy." Zardari also condemned the registration of case against Dr Tahirul Qadri.

Copyright News Network International, 2014

Prime Minister meets Ijaz, Sajid and FATA leader August 07, 2014

Prime Minister Nawaz Sharif met with Pakistan Muslim League-Z's Ijazul Haq, Jamiat-e-Ahl-e-Hadees chief Professor Sajid Mir and FATA leader G.G. Jamal here on Wednesday.




Lahori Group' calling the shots at Prime Minister's office August 07, 2014

MUSHTAQ GHUMMAN

'Lahori' District Management Group (now Pakistan Administrative Services) in the Prime Minister's office has reportedly made almost all Ministries ineffective with respect to appointments at senior positions. Background interviews with political figures and bureaucrats in different Ministries reveal that most of the appointments, transfers and postings in the Ministries and their attached departments are being done without the consent and knowledge of the relevant minister/ministry officials. For instance, Prime Minister has appointed Mukhtar Masood Chaudhary, an officer of Pakistan Administrative Services, as Managing Director National Fertiliser Marketing Limited (NFML) - a subsidiary of Ministry of Industries and Production (MoI&P) - without taking the Minister or Secretary of the concerned Ministry into confidence. Insiders claim that the newly appointed MD, NFML, who is considered close to Additional Secretary to Prime Minister, Fawad Hasan Fawad, took over the charge of the department soon after the issuance of the notification by the Establishment Division. According to the rules, Establishment Division's notification is not effective until the administrative Ministry of that department issues its own notification. "We used to hear of Punjabi bureaucracy running the affairs of state but now there is talk of a Lahori Group running the affairs of state," quipped a political figure on condition of anonymity. Managing Director, Utility Stores Corporation (USC), retains his position even though he is reportedly not on talking terms with the Minister for Industries and Production. There is an impression in all the Ministries that those summaries which are prepared by different Ministries in accordance with the "directives" of 'Lahori Group' are implemented with immediate effect whereas other summaries remain unimplemented. A close relative of a Federal Minister told Business Recorder that Nawaz Sharif during his previous tenure ran government affairs in consultation with political figures but now the entire government is controlled by a few bureaucrats. Authentic information also reveals that Commerce Ministry sent a summary to the Prime Minister two months ago to recall those trade officers who have completed their two-year terms but the summary has still not been returned to the Ministry, giving birth to a perception that the influential trade officers blocked the summary through their connections at the PM's office. Commerce Ministry maintains that a large number of Commercial Counsellors stationed overseas were selected on the basis of political connections instead of merit by the previous government and therefore need to be recalled. Fawad Hasan Fawad, incumbent Additional Secretary to the Prime Minister, was one of the affectees of the flawed selection process. The PPP-led Commerce Ministry struck separate deals with disgruntled candidates and accommodated them in different countries. Fawad Hasan Fawad was offered Afghanistan, but he refused.



Incumbent Commerce Minister, Engineer Khurram Dastgir who was Chairman National Assembly Standing Committee during the previous government had raised the issue of appointing Commercial Counsellors on the basis of nepotism to the committee and quizzed the top brass of Commerce Ministry about transparency in selections. He had sought a statement on oath from the then Commerce Secretary Munir Quershi but the latter ignored the issue. According to sources, Commerce Minister, who had expressed serious concern, at the selection process when he was in opposition has not yet conveyed any intent to recall these Commercial Counsellors after completion of their two-year terms. Commerce Ministry recently recalled Commercial Counsellor to Beijing Riaz Sheikh and sent Berlin-based Commercial Counsellor, Irfa Iqbal, to Beijing purportedly on the recommendations of Chief Minister Punjab Shahbaz Sharif. The sources said Commerce Ministry has also reallocated stations to seven Commercial Counsellors who had been recalled after the closure of commercial offices. Though Commerce Minister, Engineer Khurram Dastgir promised to ensure transparency in selection of new trade officers, however, circles close to the Minister fear that his wish will remain a wish as bureaucracy in PM office wants to maintain the status quo.


Israel 'ready to extend Gaza truce unconditionally' August 07, 2014

Israel indicated Wednesday it was prepared to extend a 72-hour ceasefire with Hamas unconditionally in the Gaza Strip as Egyptian mediators accelerated efforts to broker a longer-term truce. Guns fell silent in the tiny Palestinian enclave on Tuesday morning, allowing millions of people on both sides to breathe a sigh of relief after the deaths of 1,875 Palestinians and 67 on the Israeli side. With the truce due to expire at 0500 GMT on Friday morning, Egyptian mediators shuttled between Israeli and Palestinian delegations in Cairo, conveying conflicting demands for a long-term calm. "Israel has no problem extending the ceasefire unconditionally," an Israeli official told AFP on condition of anonymity. There was no immediate reaction from Hamas. A spokeswoman for the Israeli army confirmed earlier that 27,000 reservists called up for the conflict had been sent home, leaving a force of 55,000 still on active duty, in another sign of growing hopes for long-term quiet. In the battered Gaza Strip, shops, banks and markets have reopened, and people crowded into the streets. Emergency services cleared rubble and searched for bodies in worst-hit areas, among them Tuffah and Shejaiya near Gaza City, Khuzaa and an area east of Rafah on the southern border with Egypt. In the southern town of Rafah, volunteers dug graves for the burial of bodies stacked in morgues while the fighting raged. Many residents are angered by the extent of damage to their homes.



"Look at my house, it is totally smashed. How can my children live here?" asked Mussa Abu al-Rus whose house had been taken over by Israeli soldiers. Nearly half a million Palestinians were displaced by Israeli bombardment, and many are still sheltering in schools after their homes were flattened in the offensive.

Copyright Agence France-Presse, 2014

First-year performance: Dar struggles to articulate upbeat economic view August 07, 2014

ZAHEER ABBASI

Finance Minister Ishaq Dar on Wednesday strongly dismissed the perception that the present government has been taking economic decisions on the dictation of the International Monetary Fund (IMF). He maintained: "we are handling country's economy ourselves and not taking dictation from IMF". The Minister stated the process would be initiated during the current month to bring back $200 billion from Swiss banks. He, however, clarified that no timeframe could be guaranteed to achieve this seemingly formidable task. Addressing a news conference on government's one-year economic performance Dar dismissed as baseless speculation that a friendly country had pledged to offer to the government an amount of $2.5 billion. He said that a loan agreement would be signed with the World Bank for financing Dasu Power Project to supplement the government efforts to add planned 6000 MW electricity to the system. He added that power sector's Rs 263 billion receivables would be paid through the recovery of outstanding dues from electricity consumers. The Finance Minister said the privatisation process is moving forward in a transparent manner and tax and power sector reforms were also in progress. Foreign exchange reserves would be increased to $15 billion by the end of current year and the government would save Rs 26 billion on account of debt payment with the issuance of the Eurobond as the amount was utilised to retire expensive domestic debt. He said that for the first time during the last six year, the country's GDP growth reached 4.14 per cent and Federal Board of Revenue (FBR) tax collection increased to Rs 2266 billion, which is 16 per cent higher than Rs 1946 billion in 2012-13. The government borrowed Rs 303 billion from State Bank of Pakistan during the last fiscal year as compared to Rs 1446 billion for 2012-13 and remittances have increased to $15.83 billion. The government would not devalue the currency and suggested that those giving their analyses from Washington and Lahore must not try to cause harm to the country's economy.


Forex regulations: bill tabled to strengthen SBP powers



August 07, 2014

NAVEED BUTT

The government on Wednesday introduced "The Foreign Exchange Regulation (Amendment) Bill, 2014" in the National Assembly to strengthen and make more effective the enforcement powers of State Bank of Pakistan (SBP) as a regulator to impose penalties for violation of the law and to regulate the foreign exchange business of banks and exchange companies. The Bill was introduced by Federal Minister for Science and Technology Zahid Hamid on behalf of the Finance Minister in the lower house of Parliament. The Speaker referred the Bill to Standing Committee on Finance, Revenue, Economic Affairs, Statistics and Privatisation for further deliberations. Under the existing provisions of the Act, State Bank of Pakistan (SBP) has no direct power to impose monetary penalties on violation of provisions of the Act and has to follow a lengthy procedure of adjudication. It can only suspend or cancel the license of a bank or an exchange company on violation of any provision of the existing Foreign Exchange Regulation Act, 1947, which often becomes more severe than the violations warrant. According to the objects and reasons of the piece of legislation, to provide a deterrent and to enable SBP to take appropriate, effective and prompt remedial measures, the Bill seeks to amend the Act to empower SBP, as a regulator, to impose penalties for violation of the provisions of the Act. According to the Bill, after section 23J of the Act, the new section shall be inserted, namely:- "23K. Powers to impose penalty, etc;- (1) Without prejudice to the provisions of sections 3AA, 23 or 23B, if any person, contravenes any provision of this Act, or any order, rule, regulation or direction issued thereunder it is necessary to take immediate action to deal with such contravention, an officer of the State Bank, not below the rank of Additional Director may, after giving him or it show cause notice to be replied within fifteen days and affording such person an opportunity of being heard, impose fine which may extend to one million rupees for each contravention, and where the contravention is a continuous one with a further penalty which may extend to twenty thousand rupees for each day during which such contravention continues. (2) where the person guilty of such contravention is a company or a body corporate, every director, manager, secretary or other officer or agent thereof shall be deemed guilty of such contravention, if the contravention was committed with his knowledge or consent or if he did not exercise due diligence to prevent the commission of the offence. (3)If any person fails to pay any penalty imposed, within the time stipulated in order of imposing the penalty, the officer referred to in sub-section (1) may, without any notice to such person, recover the amount of such penalty from any account, or assets, monetary or otherwise, of the defaulter held with State Bank or any bank or a financial institution. (4) If any bank or financial institution to which notice has been sent under sub-section (3) fails to debit the amount of penalty under the said sub-section, it shall itself be liable to pay such amount to the State Bank, as if it had itself committed the contravention.



(5) Any person aggrieved by an order passed and penalty imposed under this section may, within thirty days of the order, prefer appeal to the Governor State Bank."




UN pledges to rebuild Gaza for 'last time' August 07, 2014

The United Nations is ready to help rebuild Gaza but for the last time, UN chief Ban Ki-moon warned Wednesday. Ban opened a special meeting of the United Nations General Assembly with an appeal for a lasting peace as a 72-hour ceasefire between Israel and Hamas was holding for a second day. "The senseless cycle of suffering in Gaza and the West Bank, as well as in Israel, must end," he told the 193-nation assembly. After three wars in Gaza in six years, the UN secretary general warned that the world's patience with both the Israelis and the Palestinians was being tested. "Do we have to continue like this - build, destroy, and build and destroy?" Ban asked. "We will build again but this must be the last time - to rebuild. This must stop now." Four weeks of fighting in the Gaza Strip have left 1,875 Palestinians and 67 Israelis dead, with nearly half of Gaza's 1.8 million people driven from their homes. Schools, hospitals and homes have been destroyed in Gaza, with UN Middle East envoy Robert Serry saying the carnage was worse than during the last conflict in 2008-2009. Hopes for peace were buoyed as Egypt brokered talks with Israeli and Palestinian envoys intended to address demands to lift Israel's blockade of Gaza and demilitarization of the territory. UN officials appealed for a durable peace and stressed that any agreement should go beyond an end to the fighting to address the root of the conflict. "The nightmare of the last four weeks has been a terrible reminder that only a negotiated political settlement can bring security and peace to Israelis and Palestinians alike," said Ban. The UN General Assembly was convened at the request of Arab countries, who have criticised the Security Council for failing to adopt a strongly-worded resolution to press Israel and Hamas to stop fighting. Jordan has circulated a draft resolution in the Security Council calling for a ceasefire, a lifting of the Israeli blockade of Gaza and an investigation of attacks on UN-run schools, used as shelters by civilians. But the document has yet to come up for a vote. The 15-member Council adopted a statement on July 27 calling for a truce and expressing support for Egypt's mediation efforts after the United States dropped reservations that such a text would single out Israel. Palestinian representative Riyad Mansour renewed his call for the Security Council to adopt a resolution and said failure to act was tantamount to a "constant appeasement of Israel." Israel stands as "a state above the law, immune from punishment, even when it commits war crimes and threatens international peace and security," Mansour said.




StanChart faces new US money-laundering investigation August 07, 2014

Standard Chartered confirmed Wednesday that it faces fresh US fines over alleged breaches in its anti-money laundering systems, two years after it paid massive penalties for violating American sanctions. Media reports said the probe by New York's financial regulator followed allegations that the London-based, Hong Kong-listed lender failed to spot millions of risky transactions flowing through its US operations. The bank said it was bracing to pay fines following the new investigation. The New York Times reported that regulators were seeking a "nine-figure penalty". "Certain issues have been identified with respect to the group's post-transaction surveillance system, which is part of its anti-money laundering systems and controls and is separate from the group's sanctions screening systems," the bank said in a filing to the Hong Kong Stock Exchange as it announced its first-half results. "The group is engaged in discussions with New York State Department of Financial Services... with respect to those issues and their ongoing remediation." Standard Chartered said a "monetary penalty and remedial actions" would likely follow the investigation. In December 2012, Standard Chartered agreed to pay US authorities $327 million to settle charges it violated American sanctions, principally on Iran but also on Myanmar, Libya and Sudan. Four months earlier the New York state banking watchdog had fined the bank $340 million in the same investigation, saying it hid 60,000 transactions with proscribed Iranian clients worth $250 billion over 10 years. US authorities said the bank had stripped messages on financial transfers routed through US banks of information that would show the beneficiaries were businesses and entities that fell under American sanctions. Several international banking groups have faced hefty fines from US regulators in recent years for busting sanctions. HSBC - which was also accused of complicity in money-laundering - paid out $1.9 billion in 2012, while Dutch bank ING paid a relatively paltry $619 million. Most recently, France's largest bank BNP Paribas was fined a record $8.9 billion last month for violating sanctions on Iran and Sudan, pleading guilty to charges that it deliberately hid thousands of transactions with the two countries as well as Myanmar and Cuba in what officials called a "complex and pervasive scheme". News of the fresh investigation came as Standard Chartered announced that its year-on-year profit for the first half of 2014 was up slightly at 8.4 percent. The Asia-focused bank saw increasing losses on loans and a weak financial market affect its operations, with net profit at $2.31 billion for the six months ending June 30, up from $2.13 billion in the same period last year. But the bank's profit before tax was down 20 percent at $3.27 billion from $4.09 billion last year, with impairment losses on loans seeing a loss of $846 million increased from last year's loss of $730 million in the same period.



Operating income fell almost five percent to $9.27 billion from $9.75 in the previous year. Chief executive Peter Sands admitted that the results were "disappointing". "It is not what we strive for and not what our investors expect," he said in the filing. Richard Hunter, Head of Equities at Hargreaves Lansdown Stockbrokers, said the figures made for "sorry reading". But he added: "The previous profit warning took much of the sting out of this update." The results and probe were announced after Hong Kong's stock exchange closed for the night. In London, shares in Standard Chartered were down 1.89 percent to 1,193.5 pence at 1100 GMT. London's benchmark FTSE 100 was down 1.19 percent to 6,602.89 points.


Rangers arrest Indian soldier August 07, 2014

Chenab Rangers on Wednesday took an Indian security man into their custody as the latter crossed the Sialkot Working Boundary line at Bajwat Sector. According to the Rangers sources, the Indian military man was arrested from Kaleel locality of Bajwat Sector and was shifted to an undisclosed location. India is being increasingly violating the ceasefire along the Line of Control recently. Incidents of firing from across the border were also reported recently along the Sialkot working boundary. However, it is first time the arrest of an Indian soldier on Pakistani side has been reported.


Qadri's men asked to make payment of Rs 350 million: FBR issues notice August 07, 2014

Regional Tax Office (RTO-I) Lahore has issued a income tax notice to Idara Minhaj ul Quran with a tax payment demand of Rs 350 million, official sources told Business Recorder here on Wednesday. Sources confirmed that the RTO-I Lahore has served a notice to the said organisation. The tax demand has been raised to the tune of Rs 350 million, without inclusion of additional tax and penalty. The tax proceedings have also been initiated against 10 to 15 activists of the said organisation having properties and accounts in their names, official added. Last month, Federal Investigation Agency (FIA) asked the FBR to carry out tax evaluation of 23 key activists of Pakistan Awami Tehreek/Idara Minhajul Quran, including its head Dr Tahir ul Qadri. According to the FIA, 'Enquiry No, 05/2013 FIA SIU Islamabad' is under agency's probe. It is submitted that FIA is conducting an enquiry into the affairs of Idara Minhaj ul Quran and its



sister organisations. The 23 activists of the said organisation are running the financial affairs of the said organisations. Since these persons are actively involved in making or using the donations, which pertain to FIA/SIU enquiry 5/13; therefore, to finalise the inquiry on merit, a detailed tax evaluation of the said members of these organisations may be conducted to ascertain their tax status, and the result may be intimated to the FIA Islamabad, the FIA's letter added. FIA had also communicated 23 names and their computerised national identity card numbers (CNICs) to the FBR for the purpose of tax evaluation.


Remaining 3G/4G licences: government to seek EoIs from CMOs next week August 07, 2014

TAHIR AMIN

In a bid to assess market potential for the sale of remaining two licenses (3G and 4G), the government is all set to seek Expressions of Interest (EoIs) from telecom operators next week, it is learnt. Official sources told Business Recorder that fearing poor response from the market, the government has decided to assess the market before starting the auction process for the remaining licenses. The government has budgeted Rs 56 billion under the head of non-tax revenue from the auction of two licenses in the current fiscal year and remains optimistic to completing the process in the first half of the current fiscal year. However in the event of a depression in the market the auction process may face some delay, said sources, adding that telecom operators despite winning 3G and 4G licenses have yet to launch the services commercially in some major cities. For the auction of 3G/4G licenses held in April the government had not sought EoI from telecom operators as the market was ready and a good response was expected. Pakistan Telecommunication Authority (PTA) would seek EoI through national newspapers, website while foreign telecom operators would be contacted through e-mails and letters. PTA has already started the process to prepare its own software for the auction, said sources, adding that this time the process would not require much time as unlike the previous process no international consultant would be hired for the auction. Further the government is unlikely to issue new policy directives for the remaining spectrum auction, officials maintained. According to the Information Memorandum (IM) of the auction conducted in April, the government can not conduct new auction at least for 18 months of the auction process held, however any spectrum that remains unsold in the auction can be sold anytime. Official revealed that government wanted to give some time to the existing telecom operators to launch their 3G/4G services in the country and may receive some returns after good investments. The government on May 22, 2014 awarded 3G/4G licenses to the successful bidders of the auction process held on April 23, 2014. However, one license of 4G with base price of $210



million and another 3G license exclusively kept for new entrant with base price of $291 million remained unsold in the auction as no new telecom operator showed any interest in the auction.


US drone strike kills seven in North Waziristan August 07, 2014

At least seven militants were killed in a US drone attack targeting a Pakistani Taliban compound near the border with Afghanistan on Wednesday, officials said, the latest such strike since Islamabad began a major offensive in June. The incident took place in the Lawara Mandi border village, some 60 kilometres (40 miles) west of Miranshah, the main town of North Waziristan tribal district where the Pakistani military has been fighting to wipe out longstanding bases of Taliban and other militants. US drone strikes have picked up since the military offensive in Waziristan after a near six-month hiatus. Since June 12 five drone strikes have been reported in the tribal areas by Pakistani officials. "A drone fired two missiles at a compound in Lawara Mandi and at least seven militants were killed," a senior security official in the region told AFP. The official said the dead included local and foreign militants. Local intelligence officials said that some Uzbeks and members of the Haqqani network, which is blamed for numerous bloody attacks in Afghanistan, were also among dead. The assault by military was launched after a dramatic attack by militants on Karachi airport, which killed dozens of people and marked the end of a faltering peace process with the Pakistani Taliban. More than 550 militants and 29 soldiers have been killed in the assault so far, according to the military, though the area is off-limits to journalists, making it impossible to verify the number and identity the dead independently. Pakistan routinely protests against US drone strikes, which have been targeting militants in the tribal areas since 2004, saying they are a violation of sovereignty and counterproductive in the fight against terror.




Article 245: IHC judge seeks formation of larger bench August 07, 2014

WAQAR LILLAH

Owing to the sensitivity of the case filed against the federal government's decision in relation to invocation of Article 245 of the Constitution in federal capital, the Islamabad High Court on Wednesday recommended the formation of a larger bench to hear the petition challenging government's decision. A single-member bench of Justice Shaukat Aziz Siddiqui resumed the hearing of a petition filed by President Islamabad Bar Association (IBA) Naseer Kayani and Syed Nayyab Hassan Gardezi. The petitioners contended that as there was no sign of failure of the civil administration, the government could not call out the army in aid to civil law enforcement agencies. During the course of proceedings, Justice Siddiqui forwarded the matter to Chief Justice IHC, Justice Muhammad Anwar Khan Kasi, urging him to form a larger bench to hear the matter. Justice Siddiqui said that the issue is of sensitive nature, so it should be heard by a larger bench Besides, the bench directed the IHC registrar's office to receive petitions filed under Article 199 of the constitution. Sheikh Ahsan Uddin, the counsel for the IBA, contended that there was no reason that can justify the enforcement of Article 245 in Islamabad, adding that the notification did not mention any concrete reasons for calling in army to assist civil law enforcement agencies. He requested the court to immediately suspend the said notification. The petitioner pleaded that the decision of invoking Article 245 needs to be taken by Prime Minister Nawaz Sharif or approved, at least, by the cabinet or presented in Parliament, adding thus the government decision on the issue is without any lawful justification/authority. The petition stated the government took an extreme step by calling in troops in the capital for three months. Earlier, the Interior Ministry, through a notification on July 24 invoked Article 245 in the federal capital territory for three months. Article 245 says: (1). The Armed Forces shall, under the directions of the Federal Government, defend Pakistan against external aggression or threat of war, and, subject to law, act in aid of civil power when called upon to do so. (2) The validity of any direction issued by the Federal Government under clause (1) shall not be called in question in any Court. (3) A High Court shall not exercise any jurisdiction under Article 199 in relation to any area in which the Armed Forced of Pakistan are, for the time being, acting in aid of civil power in pursuance of Article 245: Provided that this clause shall not be deemed to affect the jurisdiction of the High Court in respect of any proceeding pending immediately before the day on which the Armed Forces start acting in aid of civil power.



(4) Any proceeding in relation to an area referred to in clause (3) instituted on or after the day the Armed Forces start acting in aid of civil power and pending in any High Court shall remain suspended for the period during which the Armed Forces are so acting.


PAC decides to send AGP's case to SJC August 07, 2014

WASIM IQBAL

The Public Accounts Committee (PAC) on Wednesday finally decided to recommend to the Speaker National Assembly to refer the 'financial embezzlement' case of Auditor General of Pakistan (AGP) Buland Akhtar Rana to the Supreme Judicial Council (SJC) after thoroughly examining the report submitted by its sub-committee, sources claimed. However, no statement was issued in this respect. An in-camera meeting of the PAC meeting was held here on Wednesday headed by its Chairman Syed Khursheed Shah. The report of the PAC sub-committee, chaired by Junaid Anwaar Chaudhry, was presented before the PAC and in view of the findings of the report, the PAC decided to recommend to the Speaker National Assembly that a reference against AGP be sent to the Supreme Judicial Council as he was found guilty of embezzlement. This was the first time in the history of Pakistan that an AGP has been found guilty of financial irregularities and a reference to that effect is being sent to Supreme Judicial Council on the recommendations of the PAC. The move came after Akhtar Buland Rana on Tuesday informed the PAC that the AGP and staff were unable to present audit observations of the previous regime in front of any former minister because no person can be the judge of his own cause. At that point, the members of the committee showed full confidence in Chairman Syed Khursheed Shah and members of the committee. Reliable sources maintained that the PAC would submit its report to the National Assembly Speaker Sardar Ayaz Sadiq, who would be required to send the PAC recommendations to the Ministry of Law and Justice and Ministry of Finance who would then send the recommendations as a reference to President Mamnoon Hussain to refer it to the Supreme Judicial Council. The PAC maintained that the sub-committee completed its task with fairness and even gave two chances to AGP to appear before it to defend the allegations against him but he refused on both the occasions to appear before the committee and he (AGP) also challenged the competence and fairness of its members. The sub-committee in its report found the allegations against the AGP valid and substantive and recommended a recovery of Rs 4.6 million from him on raising his own salary without the approval of the competent authority and availing himself of the perks and privileges which were



not allowed to him under the rules and regulations. The sources said the PAC sub-committee proposed a disciplinary action against the officials of the department of the Controller General Accounts and Auditor General of Pakistan Office who were part of the alleged illegal actions.


THE RUPEE: stable trend August 07, 2014

The rupee almost managed to hold the present levels against the dollar on the local currency market on Wednesday, dealers said. The rupee shed one-paisa in relation to the dollar for buying and selling at Rs 98.82 and Rs 98.84 respectively, they said. INTERBANK MARKET RATES: OPEN MARKET RATES: The rupee showed no change versus the dollar for buying and selling at Rs 98.70 and Rs 98.90, while it posted fresh gain of 70-paisa in terms of the euro for buying and selling at Rs 131.30 and Rs 131.55 respectively, they said. In the third Asian market, the euro slipped to a nine-month low, extending its losses after data showed a sharp drop in German industrial orders, while the New Zealand dollar took a hit after a fall in dairy prices. A Singapore-based trader said investor risk aversion on concerns about the tensions in Ukraine helped to bolster the dollar broadly, and weighed on the euro. The dollar was trading against the Indian rupee at Rs 60.85, the greenback was available at 3.1970 in terms of the Malaysian ringgit and the US currency was at 6.1697 versus the Chinese yuan. Interbank buy/sell rates for the taka against the dollar on Wednesday: 77.50-77.50 (previous 77.50-77.50). Call Money Rates: 06.50-08.00 percent (previous 06.50-08.25 percent).

======================== Open Bid Rs 98.70 Open Offer Rs.98.90 ======================== Interbank Closing Rates: Interbank Closing Rates For Dollar on Wednesday. ======================== Bid Rate Rs.98.82 Offer Rate Rs.98.84 ======================== RUPEE IN LAHORE: The Pak rupee appreciated its worth in relation to the foreign currencies in the local currency markets on Wednesday. According to the currency dealers, the dollar was opened on a depressed note and could not maintain its position because of lacking buyers' interest. At close of trading, the dollar was ended at Rs 98.80 and Rs 99.10 on buying and selling counters, respectively, as against Rs 99.05 and Rs 99.30 of Tuesday. Likewise, the British pound lost its worth against local currency amid low trading activity. The pound was



traded at Rs 166.00 and Rs 166.80 on buying and selling counter, respectively, as against Rs 166.20 and Rs 167.00 of Tuesday, the dealers said. RUPEE IN ISLAMABAD AND RAWALPINDI: The rupee remained firm against the dollar on the open currency markets of Islamabad and Rawalpindi here on Wednesday. The dollar opened at Rs 98.50 (buying) and Rs 98.60 (selling) against same last rate. It did not observe further change in the second session and closed at Rs 98.50 (buying) and Rs 98.60 (selling). Pound Sterling opened at Rs 165 (buying) and Rs 165.50 (selling) against same last rate. It closed at the same rate without further change by the end of evening session.


Treason trial: Court urged to take record of case into custody August 07, 2014

KHUDAYAR MOHLA

A special court trying former army chief and President Pervez Musharraf in a high treason case on Wednesday issued a notice to prosecutor in response to defendant's plea through which he had urged the court to take record of the case into custody. A three-member special court led by Justice Faisal Arab recorded the statement of another witness, Maqsoodul Hassan, a team member of the Federal Investigation Agency (FIA). Hassan testified that he was inducted as an investigation team member on July 27, 2013, adding that the required correspondence was done to seek the record pertaining to enforcement of November 3 emergency in the country from presidency, prime minister's secretariat, law division, cabinet division and other concerned institutions. He told the court that a total of 62 documents were provided by prime minister's secretariat which provided sufficient grounds to determine that proceedings under Article 6 could be initiated against Musharraf. Hassan further said that on August 2, 2013 an FIA team had received Provisional Constitutional Order (PCO) from prime minister's secretariat, enforcement of emergency, a notification for Musharraf to keep two offices, a notification relating to the appointment of Justice Abdul Hameed Dogar as Chief Justice of Pakistan. He said that director general co-ordination of the presidency had provided the notification of appointment of Mohsin Hafiz as secretary to the President and Sharifuddin Pirzada as advisor to the President. Maqsoodul Hassan said that former governor Punjab Khalid Maqbool was contacted to record his statement; however, he gave a written statement. Hassan further told the court that Maqbool said in this statement that Musharraf did not take him into confidence regarding the imposition of emergency on November 3 in the country. During the course of proceedings, the defense counsel, Dr Farogh Nasim, showed apprehension that the FIA might manipulate the record of the case.



He urged the court that the record should be taken into court's own custody. He prayed the bench for provision of tapes regarding November 3, 2007 speeches of his client. The court issued directives to prosecution to come up with the original copies of the tapes and DVDs in the court on next hearing. Later, the court adjourned the hearing of case till August 07 (today).


Putin hits back with ban on food from sanction nations August 07, 2014

President Vladimir Putin on Wednesday slapped one-year bans and limits on food and agricultural imports from nations that have imposed sanctions on Russia over its defiant stance on Ukraine. The decision marks yet another escalation in a furious diplomatic stand-off that has seen Russia slip into growing international isolation and the onset of what some US media are calling a "new Cold War". It also threatens to send the price of Russian food soaring and feed public discontent with an economic slowdown that analysts partly blame on Putin's perceived backing of pro-Kremlin insurgents in eastern Ukraine. Putin had earlier promised to shield consumers from the effects of any retaliatory steps he would take against the West for its painful new measures against Russia. The Kremlin said in a statement that Putin's executive decree "either bans or limits... the import into the Russian Federation of certain kinds of agricultural products, raw materials and food originating from countries that have decided to adopt economic sanctions against Russian entities and (or) individuals." Russia's Rosselkhoznadzor agricultural sector watchdog said it would publish its list of recommendations by Thursday evening. Sources at the agency told Russian state media that the list would include all fruits and vegetables produced in the 28 EU nations. The ban would also cover US chicken and other agricultural goods. State statistics show Russia having imported about a third of its food from abroad in the past decade. Some of those deliveries have come from ex-Soviet nations with strong ties to Moscow. But Russia's expanding middle class has also become accustomed to fancier packaged imports from Europe lining their grocery shelves. Russia has already halted some food imports from a range of European countries as well as Ukraine. But Moscow had previously denied that the measures were in any way linked to punishing new financial restrictions imposed by EU nations and the United States on top state companies and officials with close links to Putin. The latest punitive steps forbid companies in Europe and the United States from striking future deals in Russia's vital oil and arms sectors. Top state-held firms have seen their access to Western borrowing markets severely restricted and face a possible freeze on trade of their shares on both European and New York exchanges.




Probe makes space history with rendezvous with comet August 07, 2014

The space probe Rosetta made a historic rendezvous with a comet on Wednesday, climaxing a 10-year, six-billion-kilometre (3.7-billion-mile) chase through the Solar System, the European Space Agency (ESA) said. "We're at the comet," Rosetta's flight operations manager, Sylvain Lodiot, declared in a webcast from mission control in Darmstadt, Germany. It marks the first time a spacecraft has been sent into orbit around a comet, a wanderer of the Solar System whose primeval dust and ice may hold insights into how the planets formed. In November, a robot scientific lab called Philae will be sent down to the surface to make the first-ever landing on a comet. Rosetta's rendezvous with Comet 67P/Churyumov-Gerasimenko was confirmed at 0929 GMT at distance of 400 million km from Earth, according to signals received at ground stations. ESA Director General Jean-Jacques Dordain hailed the fruit of 20 years' work to design, build and launch the three-tonne craft and then steer it to a tiny target in deep space.


Hiroshima marks anniversary of atomic bombing August 07, 2014

Tens of thousands of people gathered for peace ceremonies in Hiroshima on Wednesday, marking the 69th anniversary of the US atomic bombing of the city, as anti-nuclear sentiment runs high in Japan. Bells tolled as ageing survivors, relatives, government officials and foreign delegates observed a moment of silence in the rain at 8:15 am local time (2315 GMT), when the detonation turned the western Japanese city into an inferno. People attending Wednesday's ceremony placed flowers in front of the cenotaph at Peace Memorial Park in downtown Hiroshima. The city's mayor Kazumi Matsui recalled the grim memories of one survivor at a ceremony attended by Prime Minister Shinzo Abe and US ambassador to Japan Caroline Kennedy. The survivor, a 15-year-old pupil at the time, remembered hearing "voices from the brink of death" begging for "water, please".




WHO calls ethics meeting over experimental Ebola drug August 07, 2014

The World Health Organisation said on Wednesday it was convening an ethics meeting next week to explore the use of experimental treatment in the Ebola outbreak in West Africa. The move comes after two health workers from the US charity Samaritan's Purse were treated with medication that the WHO said had never been tested and shown to be safe in people. "We are in an unusual situation in this outbreak. We have a disease with a high fatality rate without any proven treatment or vaccine," said Marie-Paule Kieny, assistant director-general of the UN health agency.


Clarification August 07, 2014

This is with reference to a news item titled "Indo-Pak trade: World Bank decides to release technical grant" carried by Business Recorder in its 5th August issue. The entire exercise for assessing the pros and cons for granting Non-Discriminatory Market Access (NDMA) status to India has been led proactively by officers of the Ministry itself, who conducted their own analyses as well as relied upon research studies conducted by the leading Pakistani educational institutions/think tanks like LUMS, IBA, Beacon-house National University, State Bank of Pakistan, Sustainable Development Policy Institute as well as Pakistan Business Council. The said news-item therefore casts unwarranted aspersions on anonymous "incumbent officials of the Ministry". The assertion is false that any single institution has decided to release any technical assistance with the exclusive objective of facilitating Pak-India trade. Commerce Ministry is negotiating with multiple, international, multilateral and bilateral institutions and agencies for grant of technical assistance to strengthen institutional capacity to undertake research in trade matters, regional connectivity, legislation, and negotiation techniques. As an integral part of raising institutional capacity, the Ministry is reviewing its business processes in order to raise our institutional capacity to protect legitimate interests of Pakistani business and to respond to newly emerging challenges in international trade. Strengthening of land ports is only one component of the proposed project and includes Torkhum, Wagha and Chaman border crossing. The bilateral meeting between Pakistan's Commerce Minister with his Indian counterpart on the sidelines of the SAFTA Ministerial meeting at Bhutan did not take place. The purported agenda



in the said news item has no basis. Ministry of Commerce shall continue to be dedicated to seeking commercial advantages for Pakistan's manufacturers, farmers, workers and traders.


Panic selling pushes down index August 07, 2014

The Karachi share market Wednesday posted a negative trend following panic selling on rising political uncertainty in the country. The benchmark KSE-100 index declined by 293.44 points to close at 29,383 points down from 29,676.41 points. Commenting on the market situation, Samar Iqbal, Assistant Vice President Equity Sales Topline Securities, said political noise continued to affect the market with low volumes. In addition to domestic issues sell-off in global equity markets also affected the local sentiment, she added. Volume fell to 97 million shares and the value decreased to $46 million equal to Rs 4.6 billion," she maintained. Similarly, UBL June quarter earnings and dividend were in line with expectations, however profit-taking was seen in the stock, Samar said. During the intra-day trading, the market remained in red zone and touched 29,299.18 points lowest level. Followed by a bearish trend, volume at the ready counter decreased to 97.408 million shares compared to 132.767 million shares in previous session. Market capitalisation decreased by Rs 87.5 billion to Rs 6.918 trillion against previous Rs 7.005 trillion. Trading took place in 339 companies, of which 64 closed in green zone, 254 in red, while 21 remained unchanged. "Panic selling was witnessed at KSE amid thin trade on rising political uncertainty ahead of 14th August march against 2013 general elections rigging and 'demands' by major political leaders," Ahsan Mehanti, Director at Arif Habib Securities, said. Uncertainty in global stocks and institutional consolidation in overbought stocks after major earning announcements played a catalytic role in the bearish sentiment, he added. Mehanti said concerns for rising circular debt in energy sector, deteriorating geo-political situation and dismal fertiliser sales data for July-2014 also played a catalytic role in the bearish activity despite strong earning announcements in oil & banking sectors. Among top 10 volume leaders, 8 companies recorded a negative trend. Lafarge Pak emerged the volume leader with 10.1 million shares, down Re 0.01 to close at Rs 15.52. Fauji cement stood second, down Re 0.20 to close at Rs 19.99 on 4.4 million shares. TRG Pak Ltd closed at Rs 11.70, down Re 1, on 3.9 million shares. Askari Bank SPOT lost Re 0.21 to Rs 21.95 on 3.4 million shares. With 3.2 million shares, B.O.Punjab closed at Rs 8.58, down Re 0.03. Pak Int. Bulk gained Re 0.15 to close at Rs 23.09 on 3.1 million shares. Cherat Cement fell by Rs 3.33 to Rs 75.61 on some 3 million shares. With a trading volume of 2.8 million, Arif Habib Corp closed at Rs 26.29, down Re 0.51. Jah. Sidd. Co lost Re 0.32 to close at Rs 9.35 on 2.7 million shares. National Bank gained Re 0.07 to Rs 59.82 on 2.6 million shares. Wyeth Pak Ltd and Shezan Inter were the top gainers with Rs 56.28 and Rs 28.69 to close at Rs 3,296.33 and Rs 990.00, respectively. Nestle Pak and Pak Tobacco were the top losers with Rs 150.00 and Rs 57.74 to close at Rs 7,600.00 and Rs 1,097.25, respectively.




BRIndex30 sheds 161.75 points August 07, 2014

On Wednesday, BRIndex30 opened at 16,347.35 and remained negative throughout the trading session. It touched an intraday high of 16,333.56 points and an intraday low of 16,057.04 points and closed at 16,185.60 points, which shed -161.75 points or -0.99 percent lower than previous close. Total volume was 55,728,500, which was 57.21 percent of KSE All share volume and 82.95 percent of KSE 100 volume. The KSE All Share volume was 97,408,030 and KSE 100 volume was 67,182,950. BR Commercial Banks Index closed at 7,073.85 with a net negative change of -88.54 points or a percentage change of -1.24 and a total turnover of 17,691,300 shares. BR Cement Index closed at 3,196.91 points with a net negative change of -28.29 points or a percentage change of -0.88 and a total turnover of 23,120,600 shares. BR Oil and Gas Index closed at 4,133.74 points with a net negative change of -50.07 points or a percentage change of -1.2 and a total turnover of 4,653,050 shares. BR Tech & Comm Index closed at 910.22 points with a net negative change of -10.4 points or a percentage change of -1.13 and a total turnover of 7,832,200 shares. BR Power Generation and Distribution Index closed at 4,427.87 points with a net negative change of -16.79 points or a percentage change of -0.38 and a total turnover of 3,901,500 shares.




Business and Economy: Pakistan

Japanese firm to set up IT, engineering units worth $300 million in Dhabeji August 07, 2014

Sindh Chief Minister Syed Qaim Ali Shah has said the provincial government will allot 250 acres of land to a Japanese group of investment, DTS, at the Japan Special Economic Zone, near Dhabeji, in Thatta district, for establishment of IT and engineering related manufacturing industries with expected investment up to $300 million and generating 10,000 job opportunities within two years. This he decided while holding meeting with the Japanese delegation led by Dr Hironao Takahashi, Chairman, DTS Group, and Honorary Investment Counselor, Board of Investment Pakistan, which called on him at the Chief Minister's House in Karachi on Wednesday. Irfan Ahmed Siddiqui, Project Director of DTS Group of Japan, was also present in the meeting. Secretary to the CM Alamdin Bullo, Secretary Finance Sohail Rajput, Secretary IT Ali Mumtaz Zaidi and DG Sindh Board of Investment (SBOI) Raizuddin Qureshi were present. The CM said: "We are deeply interested in the Japanese investment in Sindh to take advantage of its technology development. The Sindh government has established the Japan Special Economic Zone with 2,000 acres of land at Dhabeji to facilitate the Japanese investors. He said that all incentives, necessary facilities and administrative support would be provided to Japanese investors from the Sindh government and even they would be helped to get their other problems (if any) relating to the federal government be solved. The Sindh Chief Minister asked the Japanese delegation to prepare timeframe for the establishment of their industrial units and try to complete the same within two years. He also directed the officials concerned to resolve the issues pertaining to the allotment of land and clear vacant possession of land in question very quickly. The CM said the Japanese investment will create more than 10,000 job opportunities and asked the Japanese delegates to give priority to the local people in employment. Talking on the occasion, visiting Chairman of DTS Group Dr Hironao Takahashi said his group intended to promote trade and investment activities in Sindh. He said that his group has also made investment of $10 million in IT and telecom sectors in Karachi SITE, Phase II, where software development and call centers have been established over 10 acres of land. He said his group wanted to extend its investment and bring more investment and technology units from Japan. He said his company has applied for the allotment of 250 acres of land in the Japan Special Economic Zone at Dhabeji. Speaking on the occasion, Irfan Siddiqui, Project Director of DTS Group of Japan said that after the possession of land, the physical work of construction would be started within 3 months and all industrial units within their premises would be established within two years.



He said that this investment of more than $300 million would generate 10,000 job opportunities for the local people and it would bring prosperity in the area. He said that DTS was also running call center and IT (software) development center at Karachi SITE Phase II, where it had provided training to local youths in IT under the Benazir Bhutto Shaheed Youth Development Program.


Forex regulations: bill tabled to strengthen SBP powers August 07, 2014

NAVEED BUTT

The government on Wednesday introduced "The Foreign Exchange Regulation (Amendment) Bill, 2014" in the National Assembly to strengthen and make more effective the enforcement powers of State Bank of Pakistan (SBP) as a regulator to impose penalties for violation of the law and to regulate the foreign exchange business of banks and exchange companies. The Bill was introduced by Federal Minister for Science and Technology Zahid Hamid on behalf of the Finance Minister in the lower house of Parliament. The Speaker referred the Bill to Standing Committee on Finance, Revenue, Economic Affairs, Statistics and Privatisation for further deliberations. Under the existing provisions of the Act, State Bank of Pakistan (SBP) has no direct power to impose monetary penalties on violation of provisions of the Act and has to follow a lengthy procedure of adjudication. It can only suspend or cancel the license of a bank or an exchange company on violation of any provision of the existing Foreign Exchange Regulation Act, 1947, which often becomes more severe than the violations warrant. According to the objects and reasons of the piece of legislation, to provide a deterrent and to enable SBP to take appropriate, effective and prompt remedial measures, the Bill seeks to amend the Act to empower SBP, as a regulator, to impose penalties for violation of the provisions of the Act. According to the Bill, after section 23J of the Act, the new section shall be inserted, namely:- "23K. Powers to impose penalty, etc;- (1) Without prejudice to the provisions of sections 3AA, 23 or 23B, if any person, contravenes any provision of this Act, or any order, rule, regulation or direction issued thereunder it is necessary to take immediate action to deal with such contravention, an officer of the State Bank, not below the rank of Additional Director may, after giving him or it show cause notice to be replied within fifteen days and affording such person an opportunity of being heard, impose fine which may extend to one million rupees for each contravention, and where the contravention is a continuous one with a further penalty which may extend to twenty thousand rupees for each day during which such contravention continues. (2) where the person guilty of such contravention is a company or a body corporate, every director, manager, secretary or other officer or agent thereof shall be deemed guilty of such contravention, if the contravention was committed with his knowledge or consent or if he did not



exercise due diligence to prevent the commission of the offence. (3)If any person fails to pay any penalty imposed, within the time stipulated in order of imposing the penalty, the officer referred to in sub-section (1) may, without any notice to such person, recover the amount of such penalty from any account, or assets, monetary or otherwise, of the defaulter held with State Bank or any bank or a financial institution. (4) If any bank or financial institution to which notice has been sent under sub-section (3) fails to debit the amount of penalty under the said sub-section, it shall itself be liable to pay such amount to the State Bank, as if it had itself committed the contravention. (5) Any person aggrieved by an order passed and penalty imposed under this section may, within thirty days of the order, prefer appeal to the Governor State Bank."


French CG for exchange of more business delegations August 07, 2014

Consul General of France in Karachi, Dall'Orso François has advised Pakistani business community to augment its business ties with French counterparts by sending more business delegations and holding exhibitions in France. Speaking at a meeting during his visit to Karachi Chamber of Commerce and Industry (KCCI) on Tuesday, the French Consul General added that the French government was looking forward to facilitating business ties between the two countries. President KCCI Abdullah Zaki, Vice President KCCI Muhammad Idrees, Chairman Diplomatic Affairs Sub-Committee, Abdul Jabbar Dalal, Former President KCCI Majyd Aziz and members of KCCI Managing Committee were also present at the meeting. François said that the business communities of both countries must enhance interaction in order to seek ways and means of how to undertake joint ventures in various sectors of the economy whereas Pakistan can also benefit from French expertise in the energy sector in order to effectively deal with the ongoing energy crisis being faced by the country. He further informed that the French Consulate will be sending 20 students from Sindh province under a scholarship programme to study in France. To a suggestion regarding sending Pakistani students on internship programme, he said that it was a very good idea to send talented Pakistani youth to France on internship so that they could further groom their textile designing skills, which will help in improving Pakistani exports to European Union. Earlier, while welcoming the French Consul General, President KCCI, Abdullah Zaki said that France and Pakistan had cordial relations which were based on military, defence, cultural, educational co-operation and economic ties. Touching upon the increasing trend in trade ties between Pakistan and France, Abdullah noted that Pakistan and France had recently signed an agreement on economic and commercial relationship and released a Joint Declaration on



Economic and Commercial Partnership. Under this declaration, both the countries try to develop a framework of closer economic co-operation, enhancing trade and investment links in order to strengthen the mutual relationship between the two countries. France is also trying to overcome the current energy crisis faced by Pakistan through Agence Française de Development (AFD), he added.-PR


Significant potential for Pak-Lanka bilateral trade: Prime Minister tells Kshenuka August 07, 2014

Prime Minister Nawaz Sharif said on Wednesday there was significant potential for trade between Pakistan and Sri Lanka particularly after the Free Trade Agreement 2005 became operational. The Prime Minister was talking to Sri Lankan Secretary for External Affairs Mrs Kshenuka D Senewiratune, who called on him here. He emphasised the importance of relations between Pakistan and Sri Lanka, particularly in the fields of trade and economy. "We need to address impediments and deepen bilateral economic relations between the two countries." The Prime Minister said it was a matter of great satisfaction that the last session of the Pakistan-Sri Lanka Joint Economic Commission had agreed to activate the four Joint Working Groups on Trade, Investment, Auto Sector and Customs co-operation. Mrs Senewiratune said Pakistan and Sri Lanka had always supported each other on various international fora. She also expressed the resolve that this co-operation in the realms of trade and investment would continue between the two countries in the future as well. The meeting was also attended by Sri Lankan Air Chief Marshal Jayalath Weerakkody, Sri Lankan High Commissioner and Tariq Fatemi, Special Assistant to the Prime Minister on Foreign Affairs.

Copyright Associated Press of Pakistan, 2014

Pakistan, Sri Lanka agree to consolidate ties August 07, 2014

Pakistan and Sri Lanka on Tuesday agreed on the need to further consolidate their bilateral relations in diverse areas, particularly enhanced co-operation in the fields of trade, education, culture and defence. The agreement was reached during a meeting of foreign secretaries of Pakistan and Sri Lanka, Aizaz Ahmed Chaudhry and Mrs Kshenuka Senewiratne respectively, held in connection with fourth round of political consultations here. The Sri Lankan delegation comprised Air Chief Marshal Jayalath Weerakkody, Sri Lankan High Commissioner, Senior DIG Anura Senanayake, Ministry of Defence and Urban Development,



Dharshana Mahendra Perera, Acting DG/South Asia, Ministry of External Affairs, Samantha Wijesekara, Deputy Director, Department of Commerce, Mrs Tharanga Liyanage, Director (Middle East & SAARC), Department of External Resources and officials of the Sri Lankan High Commission. The senior officials of the Ministry of Foreign Affairs and 12 other government departments were part of the Pakistani delegation. The foreign secretaries recognised that based on political goodwill the two countries enjoyed close and friendly relations, which had strengthened over the years. However, they agreed on the need to further consolidate them in diverse areas. They particularly sought enhanced co-operation in the fields of trade, education, culture and defence. Mrs Kshenuka Senewiratne briefed her Pakistani counterpart on the current developments in Sri Lanka, including the efforts on rehabilitation, reconciliation and resettlement in the post war conflict areas. The Sri Lankan side expressed deep appreciation for the steadfast support received from Pakistan at the international fora, particularly at the recently concluded UNHRC session in Geneva in countering the elements that undermine the reconciliation process. They also appreciated the development assistance by the Government of Pakistan towards Sri Lanka's reconstruction efforts. The Sri Lankan side appreciated the scholarships provided by Pakistan in various fields of education and in training of their diplomats at the Foreign Service Academy. Sri Lanka also welcomed proposals from Pakistan for assistance in curriculum development in training in the health and gems and jewellery sectors. The Pakistan side reciprocated its appreciation for the scholarships offered by the Government of Sri Lanka for its nationals. It was agreed to further diversify and strengthen existing collaboration in the field of education. Regional and global issues of mutual interest also came up for discussion during the consultations. In this context, both the sides agreed to a continued collaboration and co-operation. An exchange of views took place on a range of issues including matters of mutual interest, particularly in the region and working within the framework of SAARC. The two sides committed to share experience and assistance in event of natural disasters and calamities. The leaders of the delegations finalised the proposed agreement on co-operation in the field of disaster management for signing during the forthcoming Presidential visit in Islamabad while reiterating the need for continuing co-operation in this. Both the sides reaffirmed their resolve to strengthen co-operation in countering terrorism, drug and human trafficking, asylum seekers problems, and translational crimes in a comprehensive manner. It was agreed to continue the co-operation with renewed vigour, which includes training of security personnel. Realising the effectiveness of the foreign secretary-level consultations, they agreed to regularly hold the talks. The consultations prepared ground for President Mahinda Rajapaksa's visit to Pakistan later this month. During the visit, the two leaders will take stock of the bilateral relations and identify potential areas for co-operation to the mutual benefit of the countries and its people.




Economic growth, jobs: public, private sectors should join hands: PIAF August 07, 2014

Public and private sectors should work jointly to ensure economic growth and job creation, said PIAF Chairman Malik Tahir Javed while talking to a delegation of businessmen here on Wednesday. The PIAF chairman said that they had already given an economic plan wherein it had been suggested that the bureaucracy should not be allowed to intervene in to the businesses. He said that if the plan will be implemented, it would not only remove the bureaucratic hurdles in the smooth running of businesses but would also improve economic activities in the country. Malik Tahir Javed said that the PIAF had already supported all the government plans aimed at economic revival of the country but the need of the hour is that all the political parties should show maturity for the common cause of progress and prosperity. He said that if the government promotes the consultation with private sector, it would not only be able to achieve economic targets in shortest possible time but would also bring good governance. The PIAF chairman said that the government could control the ongoing electricity crisis only by implementing good governance in the affairs of the power distribution companies. He said that there is no second opinion about it that all power generation projects are time consuming therefore, putting an end to corrupt practices is the only solution to give some relief to the masses. He also suggested that the government would have to promote the idea of ease of doing business in the country through creating one window operation to attract foreign investment in the country.


Social impact training: Acumen seeking applications for Pak Fellows Programme August 07, 2014

Acumen - a pioneering social impact investor, addressing poverty across Africa, Latin America and in South Asia - is seeking applications for social impact training programme. Together with JS Bank, Mahvash & Jahangir Siddiqui Foundation and the Edmond de Rothschild Foundations, Acumen is seeking applicants for the Pakistan Fellows, according to a press release issued here on Wednesday. This year-long fellowship focuses on developing the next generation of social change leaders who are driving innovation and alleviating poverty across Pakistan. The first year of the Pakistan Fellows Programme was launched in January 2013, where 20 individuals were selected to participate in this year-long training, while simultaneously continuing to pursue their own social



impact initiatives. The year-long programme is comprised five multi-day seminars focusing on moral imagination, adaptive leadership, operational and financial skills, and a learning trip. The seminars give fellows access to world-class speakers, trainers, and mentors who allow fellows to deepen their skills in leadership, social change, and innovation. The fellows also have the opportunity to travel within Pakistan to broaden their understanding of social change models. But, the Pakistan Fellows Programme is about more than just training individuals to bring about change in their communities. The programme's ultimate goal is to develop a cohort of moral leaders who will set a different example for a new kind of leadership in Pakistan.-PR


Planning Commission inducts seven members, chief economist August 07, 2014

Planning Commission of Pakistan, in light of its new mandate and role, has inducted seven members and a chief economist from the leading private/academic sector organisations after approval from the prime minister on merit and following all prescribed procedures. Nadeem Javed has been hired as chief economist, who holds a Ph.D in Economics from France and has an extensive experience in economic and finance sector. Previously, he has worked as the Director of Karachi School of Business & Leadership (KSBL) and has taught macroeconomy and global economy at several universities, including LUMS and SKEMA Business School, France. He has been a member of working group on regulatory reforms at the Ministry of Finance, and has also worked at State Bank of Pakistan. Malik Ahmad Khan has been selected as Member Infrastructure and Regional Connectivity, who holds a degree in civil/environmental engineering from SEAS at the George Washington University and an MBA from the Said Business School at the University of Oxford where he was on a Professional Management Scholarship at Green Templeton College. He has a career spanning over 15 years and has served world''s most admired corporations and public sector organisations, including 10 of the Fortune 50, McKinsey and Company, Standard Life Capital Partners, Fidelity Investments, Acumen, the City of Toronto, various agencies of the government of Pakistan and a variety of global multi-lateral organisations. Ahmad is on the advocacy boards of the Saïd Business School, University of Oxford as well as being an advisor to Acumen Pakistan. Dr Syed Tahir Hijazi has been hired as Member Governance, who holds a Ph.D in Development Economics from Clark University, USA. Dr Hijazi has a professional career of more than 36 years and has served in many educational institutions including University of Central Punjab, International Islamic University, American College of Greece Athens in various capacities such as Pro-Rector and Professor. He has also served UNDP and Government of Pakistan earlier and published extensively in the area of governance.



Dr Naeem uz Zafar is selected as Member Social Sector. Dr Zafar holds a Ph.D in Economics from Northern Illinois University, USA and MBA (Finance) from IBA Karachi. He has extensive teaching and research experience of economics and social policy. He has held various teaching and administrative positions in top business schools of Pakistan. Prior to career of economics, he held various technical positions in manufacturing and power plant industries in Pakistan. Professor Dr Muhammad Yahya Khawaja is hired as Member Information Technology & Science and Technology. Dr Khawaja has Ph.D in Information Management System and Masters in Computer Engineering from University of Missouri-Rolla, USA. He is a versatile engineer and project manager with considerable international exposure and established work history in North America and Pakistan to deliver products and services in the realm of Science and Information Technology, business and engineering bases of knowledge. He is an effective technology trainer with teaching and research experience in Pakistan, Canada and USA. Dr Yahya has authored and co-authored over 70 research publications and supervised graduate students at both MS and PhD level. Muhammad Shahid Chaudhry, selected as Member Implementation and Monitoring, has an MSc in Industrial Engineering from Mississippi State University, USA and BSc Chemical Engineering from UET, Lahore. He is a Member of American Institute of Industrial Engineering and has an extensive experience in planning, monitoring and execution of projects. He has previously worked in monitoring and evaluation departments of organisations like Descon, SMEDA, Berger, KFC, Dow Hercules and the World Bank. Ayesha Javed Eirabie will be rendering her services as Member Development Communications in the Planning Ministry. She brings rich background from corporate sector. She has previously worked as Executive Vice President (Marketing and Communications) PTCL and also served other organisations including KESC, American Business Council, Pakistan Cricket Board and Daily Times. She has an MBA from Imperial College, London. Akhtar Ali, Member Energy, is an eminent energy expert and has authored a number of books on energy policy, investments and tariff issues. He is a visiting Professor of Energy at IoBM and teaches energy management. He was also a Research Fellow Energy at Harvard University''s Kennedy School of Government. Besides academic sector, he has also worked as a Chief Executive Officer of Proplan Associates; Managing Director, Karachi Pipe Mills; General Manager, Heavy Mechanical Complex and several other organisations. He has an MS degree from METU Turkey, and BE from NED, Karachi. Breaking the past tradition of appointing retired officials, the new recruitments have been made by attracting quality talent from top academic and corporate institutions of the country in line with the new vision to transform Planning Commission into a development think-tank.-PR




Clarification August 07, 2014

This is with reference to a news item titled "Indo-Pak trade: World Bank decides to release technical grant" carried by Business Recorder in its 5th August issue. The entire exercise for assessing the pros and cons for granting Non-Discriminatory Market Access (NDMA) status to India has been led proactively by officers of the Ministry itself, who conducted their own analyses as well as relied upon research studies conducted by the leading Pakistani educational institutions/think tanks like LUMS, IBA, Beacon-house National University, State Bank of Pakistan, Sustainable Development Policy Institute as well as Pakistan Business Council. The said news-item therefore casts unwarranted aspersions on anonymous "incumbent officials of the Ministry". The assertion is false that any single institution has decided to release any technical assistance with the exclusive objective of facilitating Pak-India trade. Commerce Ministry is negotiating with multiple, international, multilateral and bilateral institutions and agencies for grant of technical assistance to strengthen institutional capacity to undertake research in trade matters, regional connectivity, legislation, and negotiation techniques. As an integral part of raising institutional capacity, the Ministry is reviewing its business processes in order to raise our institutional capacity to protect legitimate interests of Pakistani business and to respond to newly emerging challenges in international trade. Strengthening of land ports is only one component of the proposed project and includes Torkhum, Wagha and Chaman border crossing. The bilateral meeting between Pakistan''s Commerce Minister with his Indian counterpart on the sidelines of the SAFTA Ministerial meeting at Bhutan did not take place. The purported agenda in the said news item has no basis. Ministry of Commerce shall continue to be dedicated to seeking commercial advantages for Pakistan''s manufacturers, farmers, workers and traders.


LCCI, CCPIT CHEM ink MoU August 07, 2014

The Lahore Chamber of Commerce and Industry (LCCI) and CCPIT Sub-Council for Chemical Industry (CCPIT CHEM) on Wednesday inked a memorandum of understanding (MoU) that would pave way for joint research and transfer of technology in the agriculture sector. The LCCI President Engineer Sohail Lashari inked the MoU on behalf of the Lahore Chamber while CCPIT Sub-Council for Chemical Industry was represented by its Vice Chairperson Ma Chunyan. The agreement would also strengthen business relations through reciprocal co-operation. The



purpose of this MoU is to establish a practical framework to facilitate the development of stronger business relations between the two parties, and to set forth the modalities of cooperation. This can enhance the implementation of mutually beneficial trade and investment objectives. Under the MoU, both organisations will encourage, promote and facilitate trade, investment, technological partnership and exchange as well as sourcing collaboration and opportunities among their business communities in accordance with the laws and regulations of the two countries for the mutual interest of both sides. LCCI and CCPIT CHEM will also facilitate exchange of trade delegations and enhance economic dialogue between the relevant business communities of the two countries. Both the organisations will assist each other in participating or organising trade fairs, exhibitions, conferences, seminars and other similar activities. They will assist each other in holding of CAC Pakistan Expo and CAC Pakistan Summit in Lahore on annual basis. LCCI and CCPIT CHEM strive to eliminate any obstacle that may hinder the growth of trade and business, by identifying the barriers and finding suitable remedial solutions. Both will co-ordinate to establish and expand business network, which facilitates the circulation of business opportunities and joint ventures, especially outsourcing and technology exchange, available in both countries among the members of LCCI and CCPIT Chem. Speaking on the occasion, the LCCI President Engineer Sohail Lashari said that keeping in view matchless success, LCCI has decided to make CAC exhibition its annual event. Vice Chairperson Ma Chunyan CCPIT Sub-Council for Chemical Industry in her address thanked LCCI and Punjab government for their support.


HCCI lauds government's economic policy August 07, 2014

President of Hyderabad Chamber of Commerce and Industry Goharullah Khan and members of executive committee have lauded the efforts of the government for strengthening the economic situation of Pakistan, adding that during last one year Pakistani export and industrial sector were on way to progress. The purchasing of eight billion rupees by people on the occasion of Eid was evidence of economic progress for which the HCCI extends felicitation to the government. The law and order situation remained satisfactory during Ramazan and Eid. They also appreciated the scarifies of Pak army during the ongoing operation in N Waziristan. They observed that political uncertainty is hitting the index of Karachi stock exchange which has caused Rs 150 billion loss to the country's economy. They said that in present situation the country cannot tolerate any political agitation and long march.




Surgical instruments exports fetch $1.35 billion in five years August 07, 2014

The exports of surgical instruments have contributed 1.35 billion dollars to national exchequer during last five years. The amount of foreign exchange earned from surgical instruments exports was 253.5 million dollars during 2008-09 and reached 303.5 million dollars mark in 2012-13. The exports of such items also fetched 229.2 million dollars in 2009-10, 260.6 million dollars in 2010-11 and 303.94 million dollars during 2011-12. A data issued by Commerce Division on Wednesday revealed that Pakistan was exporting surgical instruments to almost 183 countries of the world and during the mentioned period five major countries remained import partners including United States, France, Germany, United Kingdom and Brazil.


Prime Minister to open rehabilitated Ziarat Residency on August 12 August 07, 2014

Ziarat Residency burnt to ashes by the terrorists last year has now been restored in its original shape and will be inaugurated by Prime Minister Nawaz Sharif on August 12. The treasured national monument, a rest house used by Quaid-e-Azam Muhammad Ali Jinnah in his last days, located in the sleepy town of Ziarat was burnt to ashes when militants carried out bomb attacks on June 14/15 midnight, 2013. So intense was the attack that the flames took days to be extinguished. Balochistan government vowed reconstruction of the Residency in its original shape from its own resources. The work started in April this year, which has been completed in record four months time. The Ziarat Residency is spread over 8,000 square feet. Established by English Colonial rulers in 1861, the residency served as a resting place for the founding father of the nation. Located in the mountainous Ziarat valley, the residency is surrounded by thousands years old ancient juniper trees.




Activities at Karachi and Qasim ports August 07, 2014

The Karachi Port handled 98,677 tonnes of cargo comprising 88,262 tonnes of import cargo and 10,415 tonnes of export cargo including 4,640 loaded and empty containers during the last 24 hours ending at 0700 hours on Wednesday. The total import cargo of 88,262 tonnes comprised of 30,608 tonnes of containerised cargo; 12 tonnes of general cargo; 27,591 tonnes of bulk cargo: 25,592 tonnes of coal; 1,999 tonnes of soyabean meal and 30,051 tonnes of oil/liquid cargo. The total export cargo of 10,415 tonnes comprised of 10,405 tonnes of containerised cargo and 10 tonnes of loose bulk cement. As many as 4,640 containers comprising 2,361 containers import and 2,279 containers export were handled during the last 24 hours on Wednesday. The break-up of imported containers shows 805 of 20's and 778 40's loaded while nil of 20's and nil of 40's empty containers, whereas that of exported containers shows 243 of 20's and 209 of 40's loaded containers while 386 of 20's and 616 of 40's empty containers were handled during the business hours. There were eleven ships namely MOL Dignity, KMTC Mumbai, Express Kailash, Bunga Lavender, Splendour, IVS Beachwood, Navios Ulysses, Northwind, Pindos-III, Hua Qiang and Da Yu Xia carrying containers, oil tanker, coal, tug barge and general cargo respectively sailed out to sea during the reported period. There were two vessels viz. Songa Eagle and Kaghan carrying oil tanker and general cargo respectively currently at the berths. There were four ships namely Melina, Kota Kaya, Chrisopigi Lady and Jia Run carrying containers, oil tanker and coal respectively sailed out to sea on Wednesday. There were two vessels viz. Niara and Filia Glory carrying containers and coal respectively due to arrive on Wednesday, while six vessels viz. MOL Premium, APL Seattle, Hyundai Busan, UASC Ajman, PAC Aries and Ashahda carrying containers and oil tanker respectively are due to arrive on Thursday.

PORT QASIM

A cargo volume of 137,462 tonnes comprising 102,511 tonnes of import cargo and 34,951 tonnes of export cargo inclusive 2,891 loaded and empty containers (TEUs) was handled at Port Qasim during the last 24 hours on Wednesday. The total import cargo of 102,511 tonnes includes 56,133 tonnes of furnace oil, 3,437 tonnes of edible oil, 7,955 tonnes of chemical and 34,986 tonnes of containerised cargo. The total export cargo of 34,951 tonnes includes 9,226 tonnes of cement and 25,725 tonnes of containerised cargo. There were five ships namely CV Safmarine Ngami, CV Al-Rain, MV Chemroad Sea, MT Chemroad Rose and MT Quetta with containers, chemical, edible oil and furnace oil sailed out sea on Wednesday morning, while another ship namely CV CMA CGM Debussy with containers is expected to sail on the same day afternoon. A total number of seven vessels viz. CV CMA CGM Debussy, CV Safmarine Ngami, CV Al-Rain, MV Ikan



Prang, MT Chemroad Rose, MT Chemroad Sea and MT Quetta currently occupied berths to load/offload containers, cement, chemical, edible oil and furnace oil respectively during the last 24 hours. As many as eight ships namely Mauplassant, Taurus, Sea Glory, FSL London, Polaris, Al-Soor-II, Moon Light and Chemroad Wing with containers, furnace oil, crude oil, edible oil, canola seed and chemical are currently at the outer anchorage of Port Qasim. There were three vessels viz. CV Saigon Express, CV Marth Cshulte, CV Tabae and MT Karachi with containers and chemical took berths at Qasim International Containers Terminal and Engro Vopak Terminal respectively on Tuesday. There are six ships namely CV Mauplassant, MT Sea Glory, MT FSL London, MT Polaris, MV Moon Light and MV Chemroad Wing with containers, crude oil, edible oil, canola seed and chemical due to arrive on Wednesday.


Commissioner Multan reviews metro bus service project: report to be submitted to chief minister tomorrow August 07, 2014

Commissioner Multan Captain Asadullah Khan (Retd) while reviewing the metro bus service project has said that "we are collecting the public opinion on this project and a comprehensive report would be submitted to Punjab Chief Minister Shabaz Sharif on August 8." Briefing the member of executive body of Multan Chamber of Commerce and Industry (MCCI) including MCCI President Khawaja Muhammad Usman along with DCO Multan Zahid Saleem Gondal and Director Development Dr Muhammad Aslam, the Commissioner said that the cost of the metro bus project is likely to be increased from 32 billion rupees to 39.5 billion rupees. He said the project cost will be equally shared by the federal and the Punjab governments. The Punjab government has already allocated 19.5 billion rupees for the portion of the project in Multan. He said that tenders would be invited from international firms so that good quality work could be done at site. Majority of the participants opposed this project describing it mere wastage of huge funds. They said that there is dire need of completion of sewerage and sanitation project which requires 15 billion rupees in Multan. President of United Citizens Alliance Tariq Naeem-ullah Khan said that government should allocate 40 billion rupees for development schemes of Multan instead of metro bus project. MCCI president and Vice President Syed Iftikhar Ali Shah said the government should not neglect the opinion of the masses. DCO Multan said Multan-Faisalabad motorway would be completed soon. He said that work on this project would begin in current months and will continue with full enthusiasm until its completion.




20 locomotives to be inducted into Railways' fleet soon August 07, 2014

With the induction of 20 more locomotives into the fleet of Pakistan Railways, the public entity would be able to earn reasonable revenue, besides providing fast and comfortable service, according to Railways senior officials. Railways divisional superintendent (DS), Karachi, Nisar, told Business Recorder that these 20 engines, each costing around Rs 200 million, will be inducted into Railways fleet within few days. These engines, he added, were manufactured in China in collaboration with a Chinese firm called `CSR' and an American company `Cater Pillar'. He said that under the agreement, China would provide some 58 engines by the end of this year while 43 of them have already arrived in Pakistan. He said that the new locomotives would be used for both passenger and fright operations whereas those having 3,000 HP would be utilized for freight operations. Divisional Commercial Officer (DCO) Nasir Nazir, said that all the 20 locomotives have been parked at Karachi Cantonment station's loco shed. Chinese engineers are in the city to provide technical assistance to the Railways' staff and the short technical courses being conducted by them would be completed in a couple of weeks. "These locomotives are more powerful than those imported earlier and each locomotive can easily carry some 22.5 hundred tons of weight," said another official. Sources told BR that the financial position of Railways has increased significantly as the Federal Minister for Railways Khwaja Muhammad Saad Rafiq was trying his best to make Railways into a profitable organisation. Workers and officers of Railways are optimistic that with the addition of new locomotives, the organisation would become an economically viable organisation. Railways Mazdoor Union's President Malik Muqaddar Zaman said the new engines would open a new chapter of progress for the economic revival of Pakistan Railways.


Thatta-Sujjawal Bridge: Commissioner asks officials to accelerate pace of repair work August 07, 2014

Divisional Commissioner Hyderabad Jamal Mustafa Syed has directed to the concerned officers and Executive Engineers of Sindh Coal Authority for accelerating ongoing repair work at Thatta-Sujjawal Bridge. He stressed on the Sindh Coal Authority, District Administration Thatta and other concerned officers to complete the ongoing repair work of Thatta-Sujjawal Bridge so as the people could get relief.



He strictly directed to concerned officers to complete the repair work of Thatta-Sujjawal Bridge within the five months. This he said while talking to media persons during a visit to inspect the ongoing repair work of Thatta-Sujjawal Bridge on the special directives of Chief Minister Sindh Syed Qaim Ali Shah. Divisional Commissioner told media persons that the repair work of the bridge is carried out by the Sindh Coal Authority, for that Sindh Government allocated about Rs 89 millions. He said due to the ongoing repair work at the bridge the heavy traffic has been closed while light weight vehicles are allowed to pass through this bridge. While responding a journalist's question, he said after the completion of the repair work at Thatta-Sujjawal bridge' a special inspection team would be hired for its checking, after that the heavy traffic would be allowed on it. He said that District Administration and Sindh Coal Authority's concerned officers are in close co-operation and they are also taking efforts for its speedy completion. If more economical assistance would be required for the completion of the repair work of the bridge, funds would be provided. Responding a question regarding the construction of the Jhirk-Mullakatiar Bridge, Divisional Commissioner Hyderabad, said that the planning work has been completed for its construction and very soon the construction work of Jhirk-Mullakatiar Bridge would be carried out. On this occasion, Deputy Commissioner Thatta, Agha Shahnawaz Baber told Divisional Commissioner Hyderabad that the District Administration has banned on heavy loader vehicles during the repair work at Thatta-Sujjawal Bridge. He informed him that District Administration is in full co-operation and Liaison with the Sindh Coal Authority in order to speedy completion of repair work.


North section: non-availability of ROW hinders work on Lyari Expressway August 07, 2014

Work on North-bound section of Lyari Expressway project has been hindered by delay in handing over of right of way (ROW) to National Highway Authority (NHA) by the City District Government Karachi. As compared to Southern section, possession of land for the Northern section has proved more problematic, said an official of NHA on Wednesday. He clarified that there was no delay from the NHA-side and the remaining incomplete portion could be completed within 12 months once land had been allocated for it by the provincial government. He said early completion of the project would not only improve the traffic conditions in Karachi, but would also contribute towards improving environmental problems. Elaborating further, he said Lyari Expressway started from Zero Point Sohrab Goth Bridge on Super Highway and ended at Maripur Road Bridge. He said Lyari Expressway project was



launched in 2002 with the aim at providing faster, congestion-free, shorter and environment-friendly intercity connection between Maripur Road and Super Highway. Due to delay in the completion of the project, the cost of developing this expressway has been revised twice since it was first proposed. Originally estimated at Rs 5.1 billion, in March 2006 it is expected to cost Rs 8.227 billion once completed, he said.


PAC decides to send AGP''s case to SJC August 07, 2014

WASIM IQBAL

The Public Accounts Committee (PAC) on Wednesday finally decided to recommend to the Speaker National Assembly to refer the ''financial embezzlement'' case of Auditor General of Pakistan (AGP) Buland Akhtar Rana to the Supreme Judicial Council (SJC) after thoroughly examining the report submitted by its sub-committee, sources claimed. However, no statement was issued in this respect. An in-camera meeting of the PAC meeting was held here on Wednesday headed by its Chairman Syed Khursheed Shah. The report of the PAC sub-committee, chaired by Junaid Anwaar Chaudhry, was presented before the PAC and in view of the findings of the report, the PAC decided to recommend to the Speaker National Assembly that a reference against AGP be sent to the Supreme Judicial Council as he was found guilty of embezzlement. This was the first time in the history of Pakistan that an AGP has been found guilty of financial irregularities and a reference to that effect is being sent to Supreme Judicial Council on the recommendations of the PAC. The move came after Akhtar Buland Rana on Tuesday informed the PAC that the AGP and staff were unable to present audit observations of the previous regime in front of any former minister because no person can be the judge of his own cause. At that point, the members of the committee showed full confidence in Chairman Syed Khursheed Shah and members of the committee. Reliable sources maintained that the PAC would submit its report to the National Assembly Speaker Sardar Ayaz Sadiq, who would be required to send the PAC recommendations to the Ministry of Law and Justice and Ministry of Finance who would then send the recommendations as a reference to President Mamnoon Hussain to refer it to the Supreme Judicial Council. The PAC maintained that the sub-committee completed its task with fairness and even gave two chances to AGP to appear before it to defend the allegations against him but he refused on both the occasions to appear before the committee and he (AGP) also challenged the competence and fairness of its members. The sub-committee in its report found the allegations against the AGP valid and substantive and recommended a recovery of Rs 4.6 million from him on raising his own salary without the



approval of the competent authority and availing himself of the perks and privileges which were not allowed to him under the rules and regulations. The sources said the PAC sub-committee proposed a disciplinary action against the officials of the department of the Controller General Accounts and Auditor General of Pakistan Office who were part of the alleged illegal actions.


Preparations for IDEAS-2014 in full swing August 07, 2014

Preparations for IDEAS-2014, which will be held from December 1 to 4, 2014, at Expo Centre Karachi are underway with full zeal. The second steering committee's meeting linked with IDEAS-2014 was held on Wednesday at Expo Centre Karachi. Key members and stakeholders attended the meeting and discussed the progress made so far in this regard. While chairing the meeting, Acting Director General Defence Export Promotion Organisation, Brigadier Mazhar Mumtaz Qureshi, confidently stated, "We are receiving an overwhelming response from foreign exhibitors for IDEAS-2014 from all around the world which is evident from the fact that more than 70 percent of the space has already been booked." He further requested the participants for their co-operation in order to promote a positive image of Pakistan, which is one of the main objectives of this exhibition. During the meeting, representatives from nominated departments gave presentations.




Company News: Pakistan

UBL posts Rs 10.5 billion profit in first half 2014 August 07, 2014

United Bank Limited (UBL) announced 1H2014 unconsolidated profits of Rs 10.5 billion (EPS Rs 8.6), as compared to Rs 8.3 billion (EPS of Rs 6.8) profit in 1H2013, up by 27.4 percent. According to Topline Securities, the bank also announced interim cash dividend of Rs 2.5 per share. During the period, bank's NII (Net Interest Income) increased by 18.6 percent YoY to Rs 21.2bn. Though banking spreads averaged 6.1 percent in 1H2014 against 6.25 percent in 1H2013, NII got support from higher yields on increasing PIB portfolio of banks and rising credit growth. As a result, NIMs are estimated to improve by 30bps from 4.6 percent in 1H2013. On the other side, provisions against NPLs (Non-Performing Loans) declined by 31.7 percent YoY to Rs 669 million. In addition, Non-Interest Income increased by 16.4 percent YoY to Rs 10 billion mainly because of 20.2 percent YoY higher fee income to Rs 5.5 billion and 80.4 percent higher income from dealing in foreign currency to Rs 1.4 billion. In 2Q2014, UBL unconsolidated profits stood at Rs 5.3 billion (EPS Rs 4.3) against 1Q2014 profits of Rs 5.2 billion (EPS Rs 4.3). During the quarter, NII increased by 15.6 percent to Rs 11.3 billion while NIMs are estimated to have increased by 60bps from 4.7 percent in 1Q2014. However, higher provisions and low dividend income dented profitability growth of the bank. During the quarter, banks recorded Rs 522 million against NPLs and Rs 247 million against diminution in investments compared to Rs 147 million and reversal of Rs 6 million in 1Q2014, respectively. Dividend income also declined by 45.9 percent to Rs 365 million which caused 2.1 percent decline in Non-Interest Income to Rs 5.0 billion. On year on year basis, UBL unconsolidated profits increased by 23.4 percent YoY in 2Q2014. During the quarter, NII increased by 25.4 percent to Rs 11.3 billion while Non-Interest Income increased by 4.0 percent.


Abbott Pakistan August 07, 2014

Having global footprints in the field of healthcare and medicines, Abbott Pakistan maintains its presence in more than 130 countries. The company is part of Abbott Laboratories, Chicago, USA--the global healthcare corporation. Since 1948, the company is engaged in the pharmaceutical business and is listed on all three stock exchanges of the country. The market capitalisation of the company now stands at Rs 55 billion.



Having a diversified portfolio, the company is involved in the manufacturing of more than 196 pharmaceutical and general healthcare products while catering to the demands of local as well as international market. From nutritional products to laboratory diagnostics through medical devices and pharmaceutical therapies, the company is continuously stretching out in the fields of pharmaceuticals, nutrition, diagnostics and diabetics care. In 2005, Abbott Pakistan was awarded Class 'A' accreditation against the Oliver Wight ABCD Check list, which gives the company a recognition as one of the best global companies when it comes to operational excellence. 1Q CY14: REVIEW OF FINANCIAL PERFORMANCE Pharmaceutical industry must be grateful to the government for fixing the adverse currency movement as the industry relies heavily on imported raw material for the production of pharmaceutical products. The start of 2014 has enabled the industry to improve its profitability by controlling input costs on account of currency appreciation. For Abbott Pakistan, the quarter ended March 2014 ended on a reassuring note. Not only the top line continued its upward march, improved currency movement supported increase in gross margin which posted a rise of 200bps to 39 percent. The profitability of the company is largely driven by movement in its input costs. This is evident as the cost to sales ratio of the company stood at 61 percent as of March 2014 (March 2013: 63 percent). CY13: REVIEW OF FINANCIAL PERFORMANCE Giant fishes make giant strides! This is clearly reflected in the financial numbers of Abbott Pakistan. Even though the pharmaceutical industry in Pakistan at large seems to be in deep waters, the same doesn't hold true for the company. Apparently, the company has managed to stay on the safe wide by gradually shifting its focus from pharmaceutical business to nutritional business. Nonetheless, pharmaceutical business still captures the thickest slice of the cake of 74 percent (as of December 2013). Mind you, stringent regulatory framework and prize freeze on a bulk of drugs has become a misery for pharmaceutical manufacturers in Pakistan. The situation has prompted these pharmaceutical companies to diversify their product range into nutritional and consumer healthcare business where price regulation is not much of a concern. During 2013, net sales of the company posted a decent growth of 13 percent. However, by keeping the raw material costs and other input costs under control, the company was able to improve its gross margin by 100bps to 38 percent. It looks like improved margin is the result of alteration in the product mix as the proportion of nutritional business was increased during the year at the expense of pharmaceutical business which lent a hand in strengthening the gross margin. By the same token, the company spent less on marketing campaigns as percentage of its sales as the ratio of selling and distribution expenses to net sales dropped down to 14 percent from 15 percent in the preceding year. Thanks to the aforementioned factors, profitability after taxation surged to Rs 2.5 billion, up 21 percent year on year. Also, net margin improved by 100bps to 15 percent. WHAT DOES THE FUTURE HOLD? Pharmaceutical industry in Pakistan is known to have its own set of problems where 'over-regulation' has been regarded as the root cause by one of the



industry officials. Much to the pharmaceutical industry's woes, the government has not granted any price increase on majority of drugs since 2001, which has made the case difficult for manufacturers to wrestle with rising inflation and to maintain their gross margins. Also, there have been instances where the quality of drugs has been challenged. Smuggled drugs continue to pose a serious threat to Pakistan's healthcare nation. Not to disregard, corruption stays at one of its highest levels in Pakistan. In this regard, the launch of Good Governance for Medicine (GGM) programme by the Ministry of Health in collaboration of World Health Organisation (WHO) has brought some hope as the initiative is aimed at curbing corruption in the healthcare industry. Luckily, the present government seems to have realised that there is an urgent need to address the concerns of the healthcare industry. The government is making strides to formulate a new pricing policy with the input of all key stakeholders. One hopes that the government continues to stay dedicated in this area and puts a rational and workable pricing policy on the table.

====================================================================== Abbott Pakistan Limited - Financial Highlights ====================================================================== Rs (mn) CY11 CY12 CY13 1QCY14 ====================================================================== Sales 12947 15216 17217 4448 Cost of goods sold (8280) (9513) (10595) (2735) Gross profit 4667 5703 6622 1713 Selling & distribution expenses (1894) (2212) (2471) (680) Administrative Expenses (296) (344) (367) (97) Other Operating Income 142 183 273 146 Other Operating Charges (241) (313) (367) (85) Operating Profit 2378 3017 3690 997 Profit after tax 1645 2091 2530 629 EPS (Rs) 16.80 21.35 25.83 6.43 ======================================================================



Cotton and Textiles: Pakistan

Cotton market: trading activity gains momentum August 07, 2014

Brisk trading was witnessed on the cotton market on Wednesday as mills and spinners took interest in fresh buying to cover their immediate needs, dealers said. The official spot rate extended its appreciation for the second day, rising more Rs 75 to Rs 5375, they added. In ready session, approximately 15000 bales of cotton changed hands between Rs 5350-5550, however, prices of seed cotton in Sindh and Punjab fell modestly to Rs 2650-2700, they said. Market sources said that country's textile sector, major sources of foreign exchange earnings, trying to take benefit of GSP plus status, despite having a lot of problems with them. Confusions over delay in monsoon rains in cotton belt also a big problem for the growers as they were not getting better returns due to fall in prices, cotton analyst, Naseem Usman said. Besides, a kind of uncertainty prevailed among the growers and farmers over the developing political scenario in the country, other traders said. Reuters adds: The NY cotton futures were lower on Tuesday. A sharp drop in cotton prices overseas and a weak monsoon have raised India's imports in recent weeks, which could lift shipments more than 25 percent above the official forecast for this season ending September and help support cotton futures. Cotton sowing in India, has been delayed this year due to erratic monsoon rains, raising concerns about production. The following deals reported: 2000 bales of cotton from Sanghar sold at Rs 5350-5400, same figure from Mir Pur Khas at Rs 5375-5400, 1800 bales from Shahdadpur, 1600 bales from Tando Adam, 1000 bales from Kotri, same figure from Hyderabad all finalised at the same rate, 200 bales from Maqsoodo at Rs 5400, 400 bales from Sahiwal, 600 bales from Khanewal at the same rate, 400 bales from Hasilpur, 600 bales from Haroonabad, 200 bales from Gojra, 600 bales from Arifwala, 200 bales from Kasso Wali at the same rate, 200 bales from Chistian at Rs 5525, 400 bales from Chichawatni at Rs 5550 and 1600 bales from Burewala at Rs 5500-5550, they said.

=========================================================================== The KCA Official Spot Rate for Local Dealings in Pak Rupees --------------------------------------------------------------------------- FOR BASE GRADE 3 STAPLE LENGTH 1-1/32" ---------------------------------------------------------------------------MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL =========================================================================== Rate Ex-Gin Upcountry Spot Rate Spot Rate DifferenceFor Price Ex-Karachi Ex. KHI. As Ex-Karachion 05.08.2014 =========================================================================== 37.324 Kgs 5,375 155 5,525 5,450 +75 --------------------------------------------------------------------------- Equivalent



--------------------------------------------------------------------------- 40 Kgs 5,760 155 5,920 5,840 +80 ===========================================================================

CCMG urges growers to adopt measures to tackle pest attack August 07, 2014

The Cotton Crop Management Group (CCMG) has recommended cotton growers make special arrangements and adopt special measures to combat with highly hazardous pest attack aimed favourable rainy weather and asked the farmers to observe continuous pest scouting. Briefing the journalists over CCMG recommendations for cotton crop here Multan Central Cotton Research Institute Director Sajid Masood Shah said the CCMG has recommended continue pest scouting for sucking and bollworms on Bt and non-Bt crops twice a week. The growers have been asked using Growth Regulators for better management of immature stages of whitefly. The humid climate favours the flare up of Jassid attack which needs to combat at its early stage. The rainy season in cotton belt would favour the armyworm attack. The dusky cotton bug can be effectively controlled by using recommended insecticide at this stage of crop. The CCRI Director said that special vigilance to the Heliothis pest to avoid its epidemic spread. All sorts of precautionary measures be adopted while spaying the insecticides. The CCMG has recommended the farmers drain excessive water immediately after rains to save mortality. Eradication of Weeds may be given highest priority to evade competition, recommendations said. The farmers are asked to irrigate crop regularly to avoid the water deficiency stress. The foliar spray of micro-nutrients can reduce shedding and timely picking of open bolls for management of dusky cotton bug. The crop was sown in March, April had been observed under stress in many areas and growers apply irrigation, fertilizer, and weeding and insects control to overcome stresses to recoup its normal growth. The white flower on the top of plant is an indication of severe stress at present. The nodes above white flower should be 5-7 during July and 4-5 during August is an indicator of normal plant growth, while nodes above this range excessive growth and below stress condition.




Taxation: Pakistan

FBR agrees to discuss 13 major issues with Aptma August 07, 2014

The Federal Board of Revenue (FBR) has accepted a proposal of All Pakistan Textile Mills Association (Aptma) to discuss 13 major issues directly affecting textile industry following changes in tax rates and tariff rationalisation through Finance Act 2014. Sources told Business Recorder here on Wednesday that the Aptma, tax managers and budget makers of the FBR will sit together at the FBR House and discuss each issue raised by the textile sector. The APTMA has objected restriction on input tax adjustment, SRO.1125(I)/2011 and increase in import duty on accessories and spares of plant and machinery of the textile sector. In this regard, a meeting is expected between the Aptma and the FBR in coming days. Following issues of Finance Act 2014 would be discussed between the Aptma and the FBR: Firstly, customs duty at the rate of one percent and sales tax at the rate of 5 percent on the import of raw cotton (HS Codes 5201 to 5203). Secondly, increase in import duty on accessories and spares of plant and machinery. Thirdly, taxes on viscose staple fibre and yarn made of viscose. Fourthly, a uniform rate of customs duty levied on dyes except (HS Code 3204.1300 & 3204.1510). Fifthly, customs duty on the import of dryers (HS Code 3206.4990). Sixthly, customs duty on the import of colouring matters (HS Code 3206.4990). Seventh, customs duty on the import of generators above 1100 kVA (HS Code 8502.1390). Eighth, Restriction imposed under section 8B of the Sales Tax Act 1990 of claiming input up to 90 percent. Ninth, Exclusion in SRO.504(I)/2013 of fabrics waste HS Code 6310 imported for recycling which is raw material for textile spinning due to which customs department is charging sales tax at the rate of 17 percent. Tenthly, recently, tax department has issued notices to may units (electricity providers where sales tax on electricity bill was not being charged) and has raised income tax liability under section 162 of the Income Tax Ordinance 2001 though units have discharged their tax liability. Eleventh, short-realisation of sales tax on the import of cotton lint under SRO.1125(I)/2011 as amended. Twelve, interpretation of Clause (IV) of SRO.1125(I)/2011 dated December 31, 2011 relating to local supply of textile yarn. Thirteen, pending sales tax refunds of Aptma member mills.




Budgetary taxation measures: Monthly ST returns to reveal actual impact August 07, 2014

SOHAIL SARFRAZ

Monthly sales tax returns to be field by registered persons for July 2014 till August 15 would enable the Federal Board of Revenue (FBR) to work out the actual impact of budgetary measures, pertaining to sales tax and federal excise duty (FED), taken in budget (2014-15). Sources told Business Recorder here on Wednesday that the revenue impact of taxation measures regarding sales tax and FED in the first month of current fiscal year would be finalised in August 2014. The sales tax and FED budgetary measures have been implemented from July 1, 2014. However, the effective date of charging revised rates of sales tax would not be July 1, 2014 in cases where the amendments have been made to the Schedules of the Sales Tax Act, 1990 for the purpose of charging new taxes or enhanced taxes. All such changes in rates were enforced from June 26. The exact revenue impact of these measures would be worked out on the basis of monthly sales tax returns to be field by August 15, 2014. On filing of returns, the FBR will be able to specify the exact enhancement in sales tax and FED collection as a result of taxation measures announced in budget (2014-15). Out of Rs 231.255 billion new taxation measures taken in budget (2014-15), direct taxes measures were of Rs 149.200 billion whereas sales tax and federal excise duty measures totalled Rs 47.700 billion. For example, customs authorities are charging sales tax at standard rate on all imports of finished articles falling under SRO 1125(1)/2011 wef 04.06.2014, excluding used and worn clothing, which remain chargeable to sales tax @ 5% under SRO 657(1)/2013 dated 11.07.2013. Large Taxpayer Units and Regional Tax Offices are charging 17 percent sales tax on the subsequent supplies of such imported finished goods. Similarly, effective from July 1, 2014, FED on cement has been converted from the specific rate of Rs 400 per MT to 5 percent of the retail price. The concerned LTUs/RTOs are ensuring that retail prices are printed on the cement bags, FED is properly charged on the retail price, and no underreporting/sales suppression takes place. At the same time, from July 1, 2014, aerated waters manufacturers have been reverted to the normal tax regime, where FED is chargeable on beverages concentrate @ 50 percent of its value, and FED @ 9 percent and sales tax @ 17 percent is chargeable on aerated waters. Immediately on withdrawal of the scheme, concerned RTOs/LTUs are conducting stock taking and monitoring the production and sales of aerated waters' manufacturers. The already available information regarding production capacity and major input materials have been used as benchmark to prevent under-reporting of production and sales suppression, if any. The FBR sources were confident that all the sales tax and FED measures have been timely enforced as per law and impact would be visible on compilation of data during current month.




Probe into VAS scam may be transferred to NAB August 07, 2014

MUHAMMAD ALI

Investigation into 1,900 vehicles, which were cleared under 'Vehicle Amnesty Scheme' (VAS) on short payment of surcharge, estimated to be Rs 450 million, is expected to be transferred to National Accountability Bureau (NAB); it is learnt here on Wednesday. According to sources, six overseas Pakistanis, in a joint complaint filed with the Federal Tax Ombudsman (FTO), accused the customs authorities at Karachi of releasing car imported by overseas Pakistanis involving infringement of age limit prescribed by the ministry of commerce in its SRO 1441(I)/2012 as Peshawar customs had refused to provide a similar treatment to the car imported by the complainants at Peshawar dry port. They said the complaint was investigated and allegation of discrimination was found maintainable, hence the FTO recommended the customs authorities to take suitable measures to resolve the issue. On the other hand, the customs department had filed a review petition to set aside the FTO decision but it was rejected, due to misrepresentation, aimed at misleading the FTO and the FBR. Keeping all in view, the FBR later constituted a fact-finding committee to look into the matter and submit report on this issue. The committee in its report said that the leviable surcharge on import of old and used vehicle was not calculated correctly since June, 2012 to November 2013 and around 1,900 vehicles were cleared involving a short payment of surcharge estimated at Rs 450 million. Sources said the fact-finding committee had also confirmed the involvement of 11 customs officers including two collectors, a deputy collector, an assistant collector, three principal appraisers and four appraisers in the clearance of 1,900 vehicles under VAS. "Although fact-finding committee has established the involvement of 11 said customs officers in the case, no action has been taken by customs department in the light of the committee's recommendations." Therefore, the FBR is now planning to transfer the case to the NAB, sources maintained. When contacted, Qudsia, spokesperson at NAB Sindh denied initiating inquiry against customs department for this case, saying that "NAB Sindh is not investigating the case. However, Ramzan Sadiq, spokesman at NAB Islamabad when approached has neither confirmed nor denied.




Taxation: World

German SPD leader says tax anomaly can be eliminated before 2017 August 07, 2014

The German government can lower income tax rates before the next elections due in 2017 by eliminating "bracket creep" thanks to a projected increase in tax revenues from a new minimum wage, Economy Minister Sigmar Gabriel said on Sunday. The anomaly of "bracket creep", or "cold progression" as it is also known in Germany, stems from the country's tax laws. Unlike major economies such as the United States, Britain and France, thresholds in Germany's progressive tax system are not automatically adjusted. This means that an individual's pay rise can trigger a net pay cut. Even though his centre-left Social Democrat (SPD) party has resisted eliminating the current system, Gabriel and several regional leaders in Chancellor Angela Merkel's conservatives said tax reform should be possible before the four-year legislative period ends. "I'm convinced that we can tackle difficult issues like eliminating 'cold progression' without raising other taxes," said Gabriel, who is also SPD chairman, in an interview with ZDF television. "I'm quite certain that we can come to a result in this legislative period." The Organisation for Economic Co-operation and Development (OECD) has urged Germany to address the problem via the introduction of index-linked tax brackets. Critics complain the system "picks wage-earners' pockets" by hoisting them into higher tax brackets as their earnings rise. But government budgets have long relied on the extra funds it brings - up to four billion euros a year. Increasing numbers of conservative and SPD politicians now see scope to reduce it with the federal government on track for a balanced budget in 2014 for the first time in 40 years. Under the current German tax system, a single person who earns 40,000 euros per year and gets a 2 percent pay rise could see net income actually fall due to bracket creep, which would result in an increase in taxes of 3 percent.

Copyright Reuters, 2014



Agriculture and Allied: Pakistan

Daily trading report of PMEX August 07, 2014

On Wednesday at Pakistan Mercantile Exchange (PMEX) value traded was recorded at PKR 1.568 billion as compared to PKR 1.238 billion registered on Tuesday, up 26.63 percent. Number of lots traded increased to 9,071 from 6,156 and PMEX Commodity Index closed at 3,007. Major business was contributed by crude oil amounting to PKR 954 million (up 19 percent), followed by gold amounting to PKR 546 million (up 33 percent) and silver at PKR 68 million (up 161 percent).


PLDDD to vaccinate 22.02 million animals till September August 07, 2014

Punjab Livestock and Dairy Development Department (PLDDD) has set a target of vaccinating 22.02 million cows, buffaloes, sheep and goat till September 30, under the "Flood Plan 2014" to avoid spread of epidemics during this season. The department has started supplying vaccinations through cold chain system to save these animals and birds from different diseases. This was informed at a meeting held here on Wednesday under the chairmanship of Secretary Livestock Punjab Nasim Sadiq. Director General (Extension) Dr Muhammad Nawaz Saeed, Director Veterinary Research Institute Dr Rasheed Ahmad, Director Animal Diseases Reporting and Surveillance and in charge provincial flood cell Dr Khaliq Shafi and others also attended the meeting. The meeting reviewed the monsoon rain situation and possible threat of flood and steps for vaccination of animals to save animals from epidemic spread and availability of medicines.


Non-availability of scientific research dims future fishing prospects August 07, 2014

Pakistan's commercial fisheries sector is perturbed over the changing weather pattern of seas, as the unavailable scientific marine research has dimmed the future fishing prospects for the local fishermen. Stakeholders say the government has no policies or scientific research to disseminate



early warnings on changing marine weather to help the fisheries sector plan voyages towards precise direction to net maximum catch. "At present, every fisherman goes unplanned to the sea to hunt fish and shrimp," they said, adding that the country's commercial marine fisheries sector is following centuries old techniques of hunts. The government should precisely inform the fishermen of catch availability on the seas to save their operational costs and voyage span. "Sometimes, we toil for being unaware of the catch presence on the sea and often we net the species which we largely don't plan to catch because we are unable to understand the effects of weather change on marine life," said President Native Islanders Fishermen Association, (Nifa), Asif Bhatti. He observed the fish species, which would exist on the sea in April or May, are found in other patches of the sea but in latter months. "We request the government to provide us with latest warnings on sea patterns so that we could make our hunt plans in a better way," he said. Stakeholders believe the country's seafood export could grow if the government employed scientific studies on the commercial fisheries sector to help it make huge annual catch without disturbing the marine life and the eco-system. Fishermen say their techniques are very much primitive but also destructive to marine life since they are using illegal small-sized nets to net fish and shrimp irrespective of their approved size. "The use of illegal nets has also ruined the marine life," they acknowledged. Pakistan largely export shrimp of all kinds to world different markets, fish verities like cuttlefish, squid, Indian mackerel, red snapper, black and white pomfret, etc. Pakistan's major seafood markets are China, Middle East and Far East, exporters say. China has great demand of Pakistani cuttlefish and squid fish, exporters say, adding that China's import from Pakistan surged phenomenally in recent years, which is expected to grow further in future. Pakistan fisheries export posted a robust growth of $49.82 million hitting a historic high of $367.472 million in the last fiscal year 2013-14.




Fuel and Energy: Pakistan

LNG import scheduled for March 2015, National Assembly told August 07, 2014

The government on Wednesday informed the National Assembly that LNG import is scheduled for March 2015 but efforts are under way to materialise the project by the end of current year. Minister for Petroleum and Natural Resources, Shahid Khaqan Abbasi stated during question hour that work on the country's first LNG terminal would be completed by December 2014 and LNG import is originally scheduled for March 2015. However, he added that the government is making efforts to materialise the plan by the end of current year. The minister said import will be done through a transparent process and LNG would be used for power generation to overcome the power crisis. In a written reply to a question, he added that at present Pakistan is negotiating with Qatar only for procurement of Liquefied Natural Gas (LNG). However, for the import of regasified Liquefied Natural Gas (RLNG), negotiations are also under way with M/s Gail, India. Since Pakistan is facing acute shortage of natural gas, injection of RLNG in the gas network will play an important role in minimising the gas shortfall. He said the government is also working on alternative schemes to get gas from Iran, which includes establishment of an LNG terminal at Gwadar, to be connected with the Iranian border for import of gas. On Turkmenistan-Afghanistan-Pakistan-India gas pipeline project, he stated that the operating agreement has already been signed by the concerned countries. He said progress on this project is expected in November 2014 after a meeting of the Asian Development Bank, the main financer of the project. About IP gas pipeline, he said that China has indicated to join the IP project at any stage and added that international sanctions on Iran are major reasons for the delay in implementing the project. The minister added that expert groups of both the countries are scheduled to meet this month to workout implementation plan for the project. The petroleum minister added that under the bilateral Gas Sale and Purchase Agreement (GSPA), Pakistan segment of IP gas pipeline Project is to be completed by December 31, 2014 to start taking the contractual gas volume by January 1, 2015. He stated that under GSPA, both sides have also agreed on "take or pay" ie, if Pakistan does not take the contractual volumes of the gas from January 2015, the country would still have to pay the amount of the gas not taken. About ban on gas connections to new housing colonies, Abbasi said the ban was imposed in 2011 due to anticipated gas shortage. The ministry has moved a summary to get approval for giving new connections, he added.




Abid Sher concerned over politics of discord August 07, 2014

State Minister for Water and Power, Abid Sher Ali said at a time when the nation is fighting against terrorism some elements are busy creating political disorder and confusion in the country. The State Minister expressed these views on Wednesday while addressing a flag-hoisting ceremony here at Mepco Headquarters in line with month-long Independence Day celebrations. The State Minister criticised Imran Khan saying that he never held any protest march against corruption during the previous regime. He said Imran Khan could bring his agenda on election reforms in the parliament as it is the best forum to work for improvement of the country. Abid Sher said the government is honouring promises made with the public and the country is on the way to progress and prosperity. He stated that government is taking all possible steps to improve living standard of people, especially labourers and the poor. He asserted that none could obstruct the journey of country's progress and also added that such development policies would continue under the leadership of Prime Minister Nawaz Sharif.


PTI chief to inaugurate hydropower project today in Swat August 07, 2014

Chairman PTI Imran Khan and KP CM Pervez Khattak will inaugurate ground work on 150 KW Bar Lalkoo-Sakhra Mini Hydropower Project on Swat river at Matta today (Thursday). It will also be the opening of the series of 350 small hydel power stations to be established on rivers in Malakand region that besides overcoming the load-shedding will also pave way for setting up new Industrial estate near Chakdara and providing cheap electricity to its factories to attract maximum investment in the province.


August 10 to 14th: government decides to cut loadshedding duration August 07, 2014

Federal government has decided to bring down loadshedding duration to six hours daily from August 10 to 14 to deter the 'Azadi March' of Pakistan Tehreek-e-Insaf (PTI) scheduled on the Independence Day. Ministry of Water and Power has issued special directives to power



distribution companies to cut the loadshedding duration to six hours during the second week of August. Sources said that decision was aimed at minimising the participation of general public in long march as majority of people who were adversely perturbed due to prolonged loadshedding would prefer to stay indoors when power supply situation would improve. LESCO and other power distribution companies have been asked to ensure implementation on the government's plan.


Minister inaugurates 500kv DG Khan Grid Station August 07, 2014

Minister of State for Water and Power Abid Sher Ali inaugurated newly constructed 500Kv DG Khan Grid Station along with 30-Km long 500Kv Transmission Line by NTDC on Wednesday. He said present government is focusing on improvement and up-gradation of electricity transmission system along with the power generation through all available resources. According to him, the National Transmission and Despatch Company (NTDC) have expedited the up-gradation of electricity transmission and distribution system in compliance with Prime Minister's directives to facilitate the smooth injection of additional power generation. He said this grid station and transmission line has been completed with the cost of Rs 4,500 million and is envisaged both for southern Punjab and Balochistan to meet with the growing power demand. Earlier the MEPCO and QESCO networks had long Transmission Lines, which were causing low voltage problems along with forced load shedding in both provinces. Completion of this project would not only enhance the transmission system capacity and system reliability of existing MEPCO and QESCO system networks but also act as bridge between Punjab and Balochistan. The 500Kv DG Khan Grid Station will feed 132KV Grid Stations of DG Khan (Sakhi Sarwar, Choti, Daajal and Jampur) and will provide third alternate 220KV source to Balochistan Province through its 132KV Grid Stations of Loralai, Pishin, Qilla Saifullah, Muslimbagh, Khanozai, Harnai and Zhob Districts including Duki, Sinjavi, Mekhter, Kingri, Rakhni and Zhob. It will also help to meet load growth, line losses and forced load shedding along with improvement in voltage profile and system reliability in said areas. While appreciating the efforts of NTDC engineers and its staff, Abid Sher Ali added that apart from completion of 500Kv DG Khan Grid station, NTDC has completed/constructed series of grid stations both at 220Kv grid station Khuzdar and 220Kv Ghazi Grid Station Lahore in June 2014 along with 220Kv Okara Grid Stations in July this year. Recently, NTDC has also installed huge transformers of 250MVA at 220Kv Bund Road Lahore and 160MVA at 220Kv Grid station Mardan. Hence, the government is all out to overcome the menace of load shedding and to provide relief and uninterrupted power supply to consumers, he added.




Fuel and Energy: World

Russia and Iran set oil-for-goods contract talks August 07, 2014

Russia and Iran have agreed to discuss next month a contract for Tehran to export two percent of its annual oil production in apparent circumvention of sanctions imposed over its nuclear drive. The controversial deal is just a tenth of the size of that envisioned by the two close partners last year and appears to be aimed at shielding Russia from additional punitive steps imposed by the United States for violating international restrictions on the Islamic state. "This format of co-operation does not violate our existing international obligations," Russian Energy Minister Alexander Novak said. Russia's energy ministry said on Tuesday it had signed a memorandum of understanding with a visiting Iranian delegation that paves the way for contract talks to begin on September 9 in Tehran. The five-year framework agreement covers "the construction and reconstruction of (Iranian power) generation capacities, electricity supply network infrastructure development, as well as oil and gas," the ministry said in a statement. It added that Russia was also hoping to supply Iran with automobiles and equipment and well as consumer and agricultural goods. Russian and Western media reports late last year said the barter deal would see Iran export of up to 500,000 barrels of oil per day (25 million tonnes per year). But Moscow's Kommersant daily cited sources saying the discussions now focused on Russia's purchase of about 70,000 barrels of oil per day - a fraction of the 3.2 million barrels per day the US Energy Information Administration believes Iran produced last year. Kommersant said Russia would purchase the oil "at a small discount" to the price of Europe's benchmark Brent crude rate. Russia intends to earn extra proceeds from selling the oil on to friendly energy-starved nations such as China at global prices. Novak said on Wednesday that final oil volumes "will be determined by market needs". President Vladimir Putin and his Iranian counterpart Hassan Rouhani are expected to put the finishing touches on a final deal on the sidelines of regional summits to be held in Tajikistan on September 11 and the southern Russian city of Astrakhan on September 29. Top Russian officials have long argued that such deliveries would not break UN sanctions imposed over Iran's alleged ambition to use its fast-expanding nuclear programme to develop a nuclear bomb. Washington and EU nations have imposed their own restrictions, which also penalise countries and companies dealing in certain areas with Iran. The White House in January expressed "serious concern" over the rumoured Russian deal because the quantities under initial discussion would have boosted Iran's oil exports by more than 50 percent. Iran analyst Rajab Safarov said Russia had decided to scale back the size of the contract because it could not longer rely on a pipeline that runs through crisis-hit Ukraine. Kiev last year was ruled by a Russian-backed administration that was ousted in February. "When the initial amounts were being discussed, Russia's relations with Ukraine were not under such strain," Safarov told



AFP. The analyst said Russia had intended to ship the Iranian oil through Ukraine to oil refineries in Belarus. The Kremlin's ex-Soviet ally now receives most of its crude from Moscow at a discount. Russia would have then have been able to sell any spare oil to its international partners at a much higher prices.


Brent up on geopolitical worry, US crude falls August 07, 2014

Brent crude oil edged up from a nine-month low on Wednesday amid concerns over the conflict in Ukraine, while ample supply in the United States pressured prices there. Around 20,000 Russian troops were gathered on Ukraine's eastern border and Nato warned that Moscow may invade, exacerbating concerns about oil supplies from Russia, the world's second-largest oil exporter. Meanwhile, US crude inventories fell 1.8 million barrels last week, according to an Energy Information Administration report on Wednesday. The drop, though in line with expectations, was smaller than the fall reported by the American Petroleum Institute on Tuesday and not large enough to stem a recent drop in prices prompted in part by ample domestic stockpiles. "The market is digesting the inventory report and it's taking some of the upper pressure out as it looks for the next driver," said Gene McGillian, an analyst at Tradition Energy in Stamford, Connecticut. Brent crude oil rose 10 cents to $104.71 a barrel by 1:39 pm EDT (1739 GMT). On Tuesday, Brent closed at its lowest level since November 7. US crude for September delivery fell 61 cents to $96.77 a barrel, its weakest intraday low since early February. Oil prices have fallen more than $10 a barrel over the past six weeks, as global supply has exceeded demand, building up a glut in the Atlantic Basin and Asian markets. Despite prolonged violence in several key oil-producing regions, traders have become increasingly nervous about weak seasonal demand and poor refinery margins in a global market that is well supplied with high quality, light crude oil. But demand for gasoline in the United States was strong, as indicated by an unexpectedly steep drop in gasoline stocks, which fell 4.4 million barrels, according to the EIA data. New York RBOB gasoline futures rose 1.41 percent, or 3.84 cents, to $2.7539 a gallon. "The drawdowns in gasoline and distillate fuels are impressive, and the further drawdown in crude oil inventories should combine to support the complex," said John Kilduff, a partner at Again Capital LLC in New York. The drop in US inventories came after upbeat US economic data this week that included a spike in service-sector activity to a nine-year high and a surprisingly large increase in factory orders, possible signs of better oil demand to come. "The fact that it doesn't continue downwards is



because of uncertainty over supplies out of Libya, possible threats to Iraqi production and general geopolitical risk," said Christopher Bellew at Jefferies Bache in London. In Iraq, Kurdish forces clashed with Sunni Islamist fighters near Iraqi Kurdistan's capital Arbil, just days after militants defeated the Kurds with a rapid advance through three towns.


US natural gas futures rise 1.6 percent August 07, 2014

US natural gas futures gained 1.6 percent on Tuesday on forecasts for warmer-than-normal temperatures in the West and South, which should boost demand for gas to generate power to run air conditioners. Front-month gas futures on the CME NYMEX closed up 6.3 cents, or 1.6 percent, at $3.897 per million British thermal units. September ended over the 14-day moving average ($3.83), trading between $3.83 and $3.92 on Tuesday. Traders noted the 100-day ($4.42) was close to falling below the 200-day ($4.38) for the first time in seven months. The front-month was up 3 percent so far this week and 1 percent for the month, but down 8 percent for the year. MDA Weather Services forecast warmer weather in the US West and South over the next five days, while the Central and Eastern region will remain cool for the next two weeks. US weather models predicted near-normal temperatures for the next two weeks, with 194 cooling degree days, down from 197 earlier Tuesday, versus a normal of 193 for this time of year, according to Thomson Reuters Analytics. In early estimates, analysts forecast utilities added about 85 billion cubic feet of gas to storage last week. That is slightly below the previous week's 88-bcf build and the 90-bcf build a year earlier, but still well over the 49-bcf five-year average. If the estimates are correct, it would be the first time injections fell below the year-ago level since early May. On the NYMEX, the premium of the front-month gas contract over spot Appalachian coal climbed to $1.42 from $1.35 on Monday. A gas premium between $1 and $2 makes it cost-effective for utilities to burn coal. On the IntercontinentalExchange, next-day gas at the Henry Hub, the benchmark supply point in Louisiana, gained 6 cents to average $3.85. Next-day New York gas lost 15 cents to $2.69, while Chicago citygates gained 9 cents to $3.94, and the Southern California Border held steady at $4.18. In power markets, the next-day Mid Columbia hub in the Pacific Northwest fell $6 to average $37 per megawatt hour, while PJM West in the Mid-Atlantic lost $7 to $43. In US nuclear news, there were about 2,800 megawatts out versus 3,600 MW out on Monday. That compares with 3,900 MW out a year ago and a five-year average out of 4,500 MW. Projected water runoff at The Dalles Dam on the Columbia River in Oregon held at 107 percent of normal for April-September, the US Northwest River Forecast Center said Tuesday.




Banking & Finance

SBP sells Rs 86,893.509 MTBs Wednesday, 06 August 2014 21:06

Posted by Imaduddin

KARACHI: The State Bank of Pakistan (SBP) on Wednesday sold Market Treasury Bills (MTBs) of Rs 86,893.509 million of 3-month, 6-month and 12-month tenure.

The face value of these bills was Rs 89,625.590, said an SBP press release.

Copyright APP (Associated Press of Pakistan), 2014



BR Research: All

What will Nawaz do? August 07, 2014

BR Research

Readers of Carl von Clausewitz, the 19th century military historian, are familiar with "fog of war". The term concerns the uncertainty regarding an adversarys intents, capabilities and logistics. Well, a war is almost at his gates but the dense political fog is making it difficult for Nawaz Sharifs government to grasp and respond to its rivals designs. Reason is often the first victim in a politically-charged environment. Therefore, without evaluating the merits and demerits of what has fueled this long summer of political discord, this column has undertaken a situational analysis based on the political noise thus far. The intention is only to identify the plausible outcomes, without falling prey to the temptation of assigning likelihoods or their impact on Pakistans political and economic systems. There is still a week to go before August 14 when Imran Khans party, the Pakistan Tehreek-e-Insaf (PTI) will start its march on Islamabad. Thats arguably a long time by political standards; things can drastically change in the interim. But, as of now, a few scenarios resulting from the PTI march and sit-down seem plausible, as highlighted in the matrix. The matrix has a few assumptions that are needed for the analysis to be simple and clear and hearsay-proof. It offers a perspective regardless of whether you perceive military as indifferent or not. It also works whether or not protesting parties are deemed as pawns in someone elses game. It must be noted that while political postures (accommodative versus combative) are inherently fluid and flexible behind-the-scenes, public postures tend to be absolutist. The grid is based on public postures, with the assumption that posturing will only harden as the political showdown draws near. Of course, it is plausible that a prolonged opposition sit-down will end in a whimper if the government shows shrewd politicking before the march and patience during the sit-down. So, the matrix only highlights consequential scenarios. A look at the figure shows that its looking bleak for the Federal Government. Sure, Nawaz would welcome outcome 1 with open arms and fulfill the oppositions demands of investigating the alleged vote fraud, re-polling on key constituencies and reforming the electoral system. Everybody goes home with something. But PML-Ns problem is that the PTI has moved the goal post this week: they now want the mid-term elections (which may well be a tactic to gain upper hand in future negotiations to have their core demands met.) Nawaz has probably waited too long to offer an olive branch and his nemesis now smells the opportunity to maximise his gains. But all hope is not lost yet for an amicable resolution scenario. The response of the rest of the elected political parties is important here. If they start coalescing around the governments now-accommodative position and offer to act as a bridge to the opposition, the latter may have to show some flexibility or otherwise risk isolation.



If the opposition can meet him halfway, would Nawaz be willing to go the distance? Thats outcome 2, where the situation becomes such that only a political change can satisfy the opposition. In a deadlock, that would be a game-changing concession from the government. For crisis diffusion and to cut their losses, there is a plausible scenario (however, improbable it may seem right now) where the PML-N may agree to the minus-Nawaz formula of an in-house change-it could be Shahbaz Sharif rising to the top, or some other acceptable figure like Chaudhry Nisar--in exchange for a time-barred agreement on pushing electoral reforms. If even that doesn do it for the PTI (and Dr. Tahirul Qadri), there is another plausible scenario where the veteran political parties (read: PPP) persuade the PML-N to give in to the stubborn opposition and call in mid-terms: After all, the entire political class has a stake in preserving the hard-earned democratic continuity in the country. Status quo, the outcome 3, may seem the remotest among the four scenarios--but it is still plausible. As said earlier, if events unfolding in next seven days make the opposition somewhat submissive, the government can become combative to politically vanquish the protests for some time. History shows that unrelated, external events can come in handy for that kind of a scenario to emerge, so watch out for them! But that scenario will only kick the can down the road, with another showdown looming in the future. All bets are off in outcome 4. This is the scenario where a hardened opposition forces the government to not only unleash administrative force on protesters but also call up a political march of its own. What will happen when the government and the opposition become so embroiled in conflict that one starts seeing signs of civil war, like street agitation? Well, nobody comes as a winner out of that--non-political force(s), which may or may not be prodding any side, will be forced to intervene in a deadly stalemate. These forces may well decide to trade backdoor nudges for a more direct undertaking, which may usher in a technocratic government, or even a junta. The Federal Government has already invoked Article 245 in Islamabad, which means that Armed Forces are required to act in "aid of civil power". Thats a slippery slope. History serves a chilly reminder. Same decision was taken by PM Zulfikar Ali Bhutto in 1977. He was facing the same electoral legitimacy issues as Nawaz does now. But a few months after using this constitutional provision, his government ended in a military coup. Do these scenarios seem outlandish? Well, these are unconventional outcomes but not unusual for the land of the pure. They have happened before and they can happen again. It was outcome 1 when former President Zardari defused three long marches (June 2008, March 2009 and January 2013). It was outcome 2 when back in the ineties, multiple governments ended prematurely, including the so-called Kakar formula of 1993. Outcome 4, well, Pakistan is all too familiar with that, dating back to 1958. In all of these plausible outcomes, the Tahirul Qadri factor is really intriguing. TuQ has his own beef about the Sharifs, but his "revolutionary" drift is working to harden the stance of PTI. Now, PTI likes to position itself as the sole steward of the perceived public disenchantment with the government, so it is at pains to differentiate itself from TuQ, who represents the religious class.



That urge to differentiate means that TuQs radical pronouncements, which directly undermine the younger Sharifs political prospects in Lahore, are indirectly narrowing Imran Khans options in Islamabad, where the elder Sharif is in the eye of the storm. If there is no TuQ factor, or if it somewhat neutralises in the coming days, PTIs ultra-combative posture may start to soften a bit. So, faced with these options, what will Nawaz do? The Prospect Theory in behavioural economics suggests that people are "loss averse": they tend to become risk-seekers when they are faced with mostly bad options. They underestimate a high-probability loss situation and choose to take on the daunting odds, just as they overestimate a low-probability loss situation and decide to go overboard in eliminating small risks. If this theory is any guide, expect Nawaz to take his chances and become increasingly combative in his posture in response to his unyielding rivals. The battlefield will not be Islamabad in that case, but it will be the GT Road which the marchers will presumably take. It is plausible that a good show on the GT Road by either party will determine the chances of political change in Islamabad. Remember the 2009 lawyers march? But the prospect theory also suggests that a person with very high winning odds would choose to settle for a smaller but respectable amount, out of fear of losing everything. As the odds increasingly favour Imran Khan right now, Nawaz should respond favourably to any hints of a compromise by the opposition. Otherwise, both may force each other into a tight corner which will not end well for either of them.

================================================================== Plausible scenarios arising from the August 14 march ================================================================== Opposition ================================================================== 2 4 ================================================================== Political change Non-political change Combative Negotiated mid-term polls Technocratic setup In-house change, minus-Nawaz Military rule 1 3 Accommodative Amicable resolution Status quo Give and take; concessions Govt. survives Face-saving Instability continues Accommodative Combative ================================================================== Government ================================================================== Assumptions Its a zero-sum game among political parties PTI and PAT will eventually form a joint, monolithic opposition Even if PTI and PAT don unite, theyll not undermine each other Backdoor negotiations will be futile till August 14 ==================================================================



Where PIBs come first August 07, 2014

BR Research

Wonder if the story of any leading bank is going to be any different for the half year ended June 2014. United Bank Limited (UBL) had a good time just like its peers ABL and HBL--with profits swelling, mainly on the back of investment in government papers. The asset composition has long been shifted towards investments, with ADRs of most leading banks hovering in the 40s--UBL is no exception. With detailed numbers yet to arrive, it is safe to assume that UBL did not miss the PIB party, which offered lucrative yields in the quarter gone by. The gross spreads improved slightly, despite revised conditions for deposit returns. The deposit growth has been largely muted and carefully monitored as the bank has been on a drive to improve the deposit-mix--evident by improved margins. One of UBLs strong features has been its non-core income contribution. Non-mark-up income continued to offer healthy support to the bottom line, especially the fee and commission income. UBLs market leader status ensures it healthy revenue streams from remittances and Omni business lines. The banks treasury, too, has been performing pretty well for quite some time. UBLs drive to clean its books has also resulted in steady decline in NPLs. The infection ratio has now decreased to around 123 percent. There is sufficient coverage for it in the high 80s. All eyes will now be on the governments borrowing appetite--if it asks for more, it will get that. But a lot will depend on where the interest rates go from here--a reduction in rates would surely prod UBL and peers to do some actual banking.

============================================================== United Bank Limited (Consolidated P&L) ============================================================== Rs (mn) 1HCY14 1HCY13 chg ============================================================== Markup Earned 41,741 36,716 14% Markup Expenses 19,687 18,217 8% Net Markup Income 22,054 18,500 19% Provisioning/(Reversal) 1,235 1,344 -8% Net Markup Income after provisions 20,819 17,155 21% Non Mark-up / Interest Income 10,974 9,428 16% Operating Revenues 31,794 26,583 20% Non Mark-up / Interest Expenses 15,764 14,130 12% Profit Before Taxation 16,696 13,279 26% Taxation 5,372 4,035 33% Profit After Taxation 11,324 9,245 22% EPS (Rs) 9.23 7.24 ==============================================================



EPCL: margins leap backwards August 07, 2014

BR Research

Pity the investors who bought-long term stakes in EPCL. The stock plainly fails to take off, simply because the firms business profitability has failed to take off. After a series of loss-making years between 2009 and 2011, the firm had posted marginal profits of Rs50 million in CY12. CY13 saw profits roar to Rs717 million--an envious year-on-year growth rate. But come CY14, and the company has managed to regress backwards. The half-year ending June 2014 saw the firm positing a net profit of Rs123 million, down 71 percent over last year. The decline comes as a result of falling gross profit margins that improved significantly last year owing to healthy growth in both PVC and caustic segments. The fall in EPCLs 1H profits comes despite a 21 percent quarter-on-quarter growth in second quarters sales revenues. However, eroding margins-that slipped to 12 percent in 2Q from 14 percent in 1Q--clipped EPCLs top line quarterly gains. Gross margins had stood at 20 percent in CY13 compared to 17 and 12 percent in the preceding consecutive years. In March this year, the company expected PVC margins to remain under pressure due to high feedstock prices and slow global demand, whereas domestic demand and prices of caustic soda were also expected to remain under pressure due to high inventory in the country. Sales growth and windfalls aside, at the end of the day profitability matters.

=================================================================================== ENGRO POLYMER & CHEMICALS =================================================================================== Rs (mn) 1HCY14 YoY chg 2QCY14 YoY chg =================================================================================== Net revenue 11,903 -1% 6,536 6% Cost of sales (10,337) 6% (5,730) 12% Gross profit 1,565 -31% 806 -23% Gross margin 13% down 570 bps 12% down 470 bps Distribution and marketing expenses (666) 7% (343) 21% Administrative expenses (310) 14% (171) 13% Other operating expenses (128) -38% (105) 13% Other income 62 57% 38 149% Operating profit 524 -57% 224 -58% Finance costs (315) -51% (273) -16% Profit/(loss) after taxation 123 -71% (25) ===================================================================================



Crime Updates

Bahawalpur: 2 women terrorists held, explosives recovered BAHAWALPUR: The Bahawalnagar police claimed to have arrested two female terrorists from Islampura area and recovered a huge quantity of explosives from them.

A spokesman for Bahawalnagar DPO Muntazar Mehdi, in a statement, stated that on a tip-off, they had been monitoring Zohran and Manzooran for having links with banned outfits. He said that they had arrested the terrorists from near Old Girls Degree College and recovered the explosives. He said that the B-Division police had registered a case against the terrorists under the Anti-Terrorist Act and Explosive Act. Later, both the terrorists were sent to New Central Jail, Bahawalpur.

Quetta: 11 Afghans held under Foreign Act QUETTA: Personnel of a law-enforcement agency arrested 11 Afghan nationals under the Foreign Act at the Balily check-post area here on Tuesday.

Islamabad: NAB arrests contractor for fraud of Rs73.6m ISLAMABAD: The National Accountability Bureau (NAB) Rawalpindi has arrested an accused Javed Iqbal Abbasi, involved in corruption and corrupt practices through embezzlement in government funds. The accused was a government contractor with Ministry of Defence Production. He, with malafide intention manipulated the court decision in application/calculation of interest-rate and illegally received Rs80 million instead of the actual amount which was approximately Rs6.33 million hence committing a fraud of Rs73.6 million.

The accused was awarded a contract for the construction of 48 apartments which he completed and an amount of Rs6.33 million was outstanding on Ministry of Defence Production. He after several years made the concerned authorities calculate interest-rate on the period involved and enhanced the balance amount from Rs6.33 million to Rs80 million without any plausible justification.

After issuance of arrest warrants form NAB chairman, the accused, Javed Iqbal Abbasi has been arrested. His name has been placed on Exit Control List (ECL).He will be produced before the Accountability Court Islamabad for obtaining his physical remand for further interrogation.



Suspects arrested in Peshawar PESHAWAR: Dozens of suspects including 16 proclaimed offenders were arrested during a crackdown in the provincial capital on Tuesday. A press release said dozens of suspects including 16 proclaimed offenders, a number of illegal Afghan nationals and others were rounded up in raids in the limits of different police stations.

Karachi: Arrested target killer confesses of murdering 23 people KARACHI: A spokesman of Rangers claimed that a target killer has confessed of murdering 23 people. According to the spokesman of the para-military force, target killer Noor Mohammad alias Noora was arrested by the Law Enforcing Agencies (LEAs) from Northern Bypass.

He confessed that he gunned killed 23 people including a head constable, drug dealers and religious figures. He also confessed that he was involved in serious crimes such as extortion and robberies as well, spokesman added. Rangers spokesperson further said that raids are being carried out to arrest the hitman’s accomplices.

Chakwal: 2 arrested recovered illegal weapon and liquor CHAKWAL: Dhudial police arrested two people and recovered an illegal weapon and liquor from them. Police arrested Danish Salahuddin of Rawalpindi and recovered a 30-bore pistol from him and Muhammad Adil Hanif of Rawalpindi and recovered two liquor bottles from him. Police have registered separate cases. Meanwhile, the same police arrested Farhan Sultan for driving a car rashly.

Maintaining security: Remote-control bomb dismantled By Our Correspondent

Published: August 7, 2014

MULTAN: The bomb disposal squad on Wednesday dismantled a bomb planted near the railway track in Ranajpur. A railway police official said the eight kilogramme bomb had been buried near the railway track. He said it was a remote-controlled device. He said some residents of the area had told the police that they saw some men dig a hole there in the middle of the night. He said Khushhaal Khan Khattak Express was believed to be the target of the attack. He said the train was stopped by railway officials at Jampur railway station. He said the train was allowed to



leave after it was searched for two hours. Rajanpur district coordination officer has announced a Rs50,000 cash prize for the bomb disposal squad. This is the 72nd terrorist attempt on trains entering Balochistan from Punjab in three years.

Published in The Express Tribune, August 7th,2014.

Law and order: Man shot and injured in mugging By Our Correspondent


BAHAWALPUR: A sugar mills field officer was shot and injured in a robbery on Wednesday. Police said Muhammad Bakhsh and his partner Karam Elahi were on their way to Multan to purchase some machinery. They had withdrawn Rs600,000 from a bank for this purpose. They said they were stopped by two unidentified men near Bano Bazaar who tried to snatch the money from Bakhsh, who resisted. Police said the robbers shot him and fled, threatening to shoot passers by if they tried to stop them. They took away Rs500,000, leaving Rs100,000 in his pockets. Police said Bakhsh was taken to a hospital where doctors said later his condition was stable.


Crime scene evidence uploaded to database By Our Correspondent


FAISALABAD:

Faisalabad police on Wednesday began uploading data of supplementary statements to an online database set up to collect crime scene evidence. City Police Officer (CPO) Sohail Habib Tajik told newsmen that the benefits of information technology could not be denied. “Criminals use modern technology,” he said. “Unfortunately, police in Pakistan still relies greatly on traditional methods. This leaves room for errors and we sometimes lose some of the evidence we collect.”

He said the government wanted to make use of modern tools to store information and access it whenever needed. The CPO said the government had planned an extensive programme to overhaul the existing system of gathering crime scene reports.

He said a few weeks ago, 80 android phone sets were provided to 40 police stations and two officials from each station were trained in the use of these phones. He said they were directed to map crimes and to make an electronic visual of the crime scenes.



He said all data collected was linked to the main control room in real time and a log every crime reported in the city was created.

The CPO said the pilot project was being implemented in Faisalabad and if it was successful, it would be introduced to other parts of the country.

The CPO said investigation officers had been directed to keep records of supplementary police reports after registration of FIRs.

He said they had been told to upload regular progress reports of cases online so that they could be retrieved easily.




Miscellaneous News

IDEAS-2014: Preparations get under way By PPI


KARACHI:

Preparations are under way with full zeal for IDEAS-2014 exhibition that is set to kick off on December 1, 2014, at the Expo Centre, Karachi.

The 2nd Steering Committee Meeting linked with IDEAS-2014 was held at Expo Centre Karachi where key members and stakeholders were present to discuss the progress made so far towards making it a success.

While chairing this committee, Acting Director General Defence Export Promotion Organization, Brig Mazhar Mumtaz Qureshi said the response was overwhelming. “This is evident from the fact that more than 70% of the space has already been booked,” said Qureshi.

DG DEPO further requested the participants for their cooperation in order to promote a positive image of Pakistan, which is one of the main objectives of the exhibition.

Published in The Express Tribune, August 7th, 2014.

Threat to business: Peaceful solutions required, says FPCCI president By Our Correspondent


KARACHI:

Federation of Pakistan Chambers of Commerce and Industry (FPCCI) President Zakaria Usman said that Pakistan is passing through a critical phase demanding all parties to discuss peaceful solutions to current problems.

Usman said the uncertain law and order situation is creating problems for the businesses and people. The life threats to businessmen and buyers who come to place orders are on a rise.

“Political instability is adversely affecting economic performance of the country,” said Usman. “When this situation arises, investors adopt a wait-and-see attitude. He mentioned that the



strained relationship among political parties will damage the business confidence and investment activities.

FPCCI president concluded that the ultimate target of the macroeconomic policies is the achievement of high and sustainable economic growth.


New health projects: Equipment purchase for WIC starts By Our Correspondent


LAHORE:

The Health Department has started procurement of medical equipment and machinery for Wazirabad Institute of Cardiology (WIC). Interviews for hiring staff for the hospital will start on August 12.

A Health Department spokesman said that Rs1 billion had been spent on the project so far. He said another Rs134 million had been allocated for its completion. “The outdoor patients department will start operating on October 1, 2014. The indoor patients department will become functional in January 2015,” the spokesman said.

He said that Health Secretary Dr Ejaz Muneer had chaired a meeting to review the progress of the WIC project.

“The WIC and the Mayo Hospital Surgical Tower projects are at the top of the government’s priority list,” he said. He said the Surgical Tower was almost complete and Rs300 million would be spent on the project during 2014.

“The health secretary has directed the officials concerned to expedite the completion of the tower.

Upon its completion, all surgical wards/operation theatres of Mayo Hospital will be shifted there,” he said.




Petroleum products: PSO willing to buy but won’t heed to Byco’s condition By Saad Hasan


KARACHI:

Pakistan State Oil (PSO) stands ready to buy petroleum products from the troubled Byco refinery but it cannot do that at the cost of piling burden on its already leveraged books, officials told The Express Tribune.

Byco International Incorporated’s (BII) 120,000 barrels per day (bpd) oil refinery has run intermittently since commercial production started earlier this year because of financial constraints and difficulty to find market for its key high speed diesel (HSD) products.

“PSO has no issues with Byco. We just want reliable supply and that’s all,” said a senior official of the state-run petroleum marketing giant. “But Byco wants us to give them letter of credits (LCs), which they can use to import crude oil. That proposition appears difficult.”

PSO has a monthly limit of around Rs100 billion to borrow from banks to import petroleum products like HSD and furnace oil. Extending that would require government intervention and consent of the State Bank of Pakistan, the official added.

Being a government entity, PSO faces minimal risk of default and banks would easily raise the credit limit for the company to accommodate Byco. But that seems unlikely now as the government plans to use PSO’s balance sheet, which reflects annual sales revenue of over Rs1.2 trillion, to import liquefied natural gas (LNG) from next year.

BII has built country’s largest oil refinery and petrochemical complex with an investment of around $600 million. The sheer size of the refinery requires at least 3 tankers with 70,000 tons of crude oil to be imported every month. That means financing lines of Rs15 billion to Rs16 billion.

PSO buys petroleum products from local refineries on a 30-day credit, paying for the products after a month. In essence, Byco wants to use the LCs from PSO as assurance to convince banks to finance its own crude oil imports.

Byco’s refinery, located in Hub, Balochistan, has faced difficulty in taking diesel to customers, most of which are based in Punjab and further north. Initially when the refinery was being set up, BII hoped to use Asia Petroleum Limited’s (APL) 82-kilometre long pipeline to move diesel to Port Qasim. But negotiations with the APL sponsors did not materialise.

The APL pipeline is used to supply furnace oil to Hub Power Company’s 1,300 megawatts (MW) power project, which is Byco refinery’s next-door neighbour. APL charges $12 per ton to transport that furnace oil from the port. Byco says it couldn’t have matched that.



As an alternative, the company came up with a plan to ferry diesel from its refinery to Port Qasim from where it could be pumped upcountry through cross country white oil pipeline. HSD makes up 40% of the refinery’s output.

Byco has a single point mooring (SPM) facility, a floating jetty connected with storage tanks with a 15km long pipeline, which allow ships to take and offload oil without coming to the shore.

The company has already retrofitted the facility with pumping machines to pump diesel into the ships. A tanker will be hired to move the cargo. The entire operation from filling 50,000-ton tanker, shipping it to Port Qasim and then offloading it will take three-and-a-half days.

BII estimates that it will cost around 70 paisa per litre to take diesel from the refinery to Port Qasim and this amount should be covered under the inland freight equalisation margin (IFEM), a central pool of funds used to keep price of petroleum products same across the country.

However, government has yet to give a nod for recovering this cost from IFEM.

Some industry people also say that there is a strong lobby within PSO that favours purchase of HSD from Kuwait Petroleum Company (KPC) instead of Byco. But a senior PSO official denied the allegation and said that it was the government, which has forbidden it to disturb import volumes of 2.7 million to 3 million tons of HSD from KPC.

“As a matter of fact, before we were locking orders for 2014 with KPC, we asked Byco for their supply schedule but they didn’t provide any confirmation.”


Islamic finance: SBP’s 5-year plan will drive asset growth, says Moody’s official By Our Correspondent


KARACHI:

Moody’s Investors Service has said the five-year strategic plan issued by the State Bank of Pakistan (SBP) will drive strong asset growth in the Islamic finance sector because of high demand from the domestic population for Islamic banking.

“We believe that this strategic initiative will lead to strong growth and consolidation in the sector, given the relatively small size of market participants and capital bases needed to support growth,” a statement quoted Khalid Howladar, Moody’s global head of Islamic finance, as saying on Wednesday.



While expecting optimism about growth prospects of Islamic banking in Pakistan, Moody’s noted risks associated with high growth rates, which will pressure underwriting and the risk management infrastructure.

Deposits of the Islamic banking industry increased to Rs872 billion at the end of the first quarter of 2014, up 23.8% from March 2013. The market share of Islamic banking industry’s deposits in the overall banking industry stands at 10.7% in March, up 1% from the market share of 9.7% one year ago.

The SBP’s five-year strategic plan targets a 15% share of banking system assets for the sector by 2018, up from around 10% as of December 2013.

“Although the asset quality of Islamic banking is currently better than that of conventional banking – with a non-performing financing ratio of 5.7% as of end-2013 versus 13% for conventional banking – the high rate of financing growth may eventually lead to higher delinquency ratios in the absence of a prudent approach to expansion,” according to Melina Skouridou, Moody’s analyst for Pakistani banks.

Additionally, according to the regulator’s mandates, the banks need to establish separate departments to manage risk, auditing, treasury activities and other support functions for their Islamic operations, which pose additional risks and will pressure the banks’ infrastructure.

According to Moody’s global head of Islamic finance, Islamic banking in Pakistan is growing rapidly with annual growth rates of Islamic banking above 30% between 2009 and 2013. While most of this growth has been generated by the dedicated Islamic banks, most of the country’s largest conventional banks have announced expansion plans targeting the fast-growing Islamic sector.

For example, National Bank of Pakistan (NBP) will convert around 6% of conventional branches into Islamic banking branches over the next two years.

In April, MCB Bank aborted efforts to buy a majority stake in Burj Bank, which is a relatively small Islamic bank, and is instead setting up its own Islamic banking subsidiary.

Similarly, Allied Bank has also launched Islamic banking operations in 2014 through stand-alone shariah-compliant branches.

“We believe that the push for Islamic banking services will help to expand overall banking system penetration, which is currently low in Pakistan where consolidated banking system deposits accounted for only 36% of GDP as of end-2013,” Skouridou said.

The SBP’s five-year plan envisages doubling of the number of branches in 2014-18. It also envisages revamping of Shariah-compliant export financing schemes and making available Shariah-compliant long-term financing facility.




Preferential trade: Turkey ready to sign PTA, blames Pakistan for delay By Our Correspondent


KARACHI:

Turkey has expressed its willingness to sign the much-awaited preferential trade agreement (PTA) with Pakistan as it has no outstanding issue to settle but the accord is being delayed by Islamabad.

Commercial Attaché at the Consulate General of Turkey in Karachi, Murat Mustu, stated this while speaking at the Karachi Chamber of Commerce and Industry (KCCI) on Wednesday.

Mustu said the PTA would provide concessions on a number of goods to Pakistan’s exporters, who would have the advantage to smoothly penetrate into the Turkish market.

Commenting on Pakistan-Turkey ties, he stressed that both the countries had been continuing to enjoy strong and friendly relations for decades and had been supporting each other during difficult times.

“It is the desire of the Turkish government to strengthen trade ties with Pakistan. We must make efforts to increase the trade volume and investments in both countries,” he added.

He highlighted various sectors in which business communities of the two countries could enter into joint ventures. Among these, Pakistan’s livestock sector had the potential to considerably increase exports to Turkey as its meat was more delicious and cheaper than the Turkish product, he said.

“Through collective efforts, we can certainly raise the existing trade volume to new heights.”

He announced that a three-member Turkish delegation would visit the KCCI on August 13 to brief the businessmen about the 15th Musiad International Fair and 18th International Business Forum Conference, which would be organised in Istanbul from November 26 to 30 this year.

Besides Karachi, the delegation will also make a trip to Lahore and Islamabad in order to seek advice on how to contribute to the development of bilateral trade.

Another two-member Turkish delegation will arrive soon to ensure participation of Pakistan’s businessmen in the Istanbul Jewellery Show, scheduled to be held from October 16 to 19. KCCI President Abdullah Zaki underscored the need for a fast-track signing of the PTA between Pakistan and Turkey. “It is high time to ink this important agreement, which will substantially improve the trade volume.”



KCCI’s Diplomatic Affairs Sub-committee Chairman Abdul Jabbar pointed out that the Turkish government had imposed anti-dumping duty on textile products in July 2011, which terribly affected Pakistan’s exports.

He sought the diplomat’s help in persuading his government to abolish the duty and help improve Pakistan’s textile exports.


Troubled bank gets last chance to increase capital By Shahbaz Rana


ISLAMABAD:

The federal authorities have given a last chance to a troubled private bank that is struggling to meet its paid-up capital requirement before taking over control of it as the bank’s capital needs have grown far more than Rs10 billion, says Finance Minister Ishaq Dar.

The State Bank of Pakistan (SBP) had proposed that the private commercial bank should be taken over as the management was using delaying tactics for the last two and a half years and was not fulfilling the capital adequacy ratio (CAR) requirement, he said.

Dar was responding to a question at a press conference on Wednesday over putting the name of the bank’s majority shareholder on the Exit Control List (ECL).

According to the SBP’s plan, Dar pointed out, it was recommended that depositors’ assets should be frozen for 15 days after the takeover. “But instead of accepting the proposal, we decided to give a last chance before taking any action.”

The federal government has put the name of the banker, who owns majority shares in the bank, on the ECL on the central bank’s recommendation after he allegedly refused to sell his institution to a Lahore-based business tycoon.

The limited bank, headquartered in Karachi, is among three commercial banks that are falling short of the CAR requirement – the ratio of a bank’s capital to its risk.

Dar denied that the government was giving preference to a party and the matter of finding a partner had been left to the bank’s management.

He said he had made it clear to the bank management that it could negotiate with any investor except the National Bank of Pakistan as it would not give an impression that the government was buying the private party’s bank.



Dar said the banker’s name was put on the ECL after SBP Governor Ashraf Wathra feared that the banker who often remained abroad and may go again for a few months could delay the resolution of the longstanding issue.

He pointed out that the bank’s capital requirement was around Rs5.5 billion a couple of years ago, which has now increased more than twice. “The banker’s name will remain on the ECL until he finds a solution.”

To a question about giving preferential treatment to the other two banks that were also not meeting the CAR requirement, Dar stressed that the SBP was also engaged with the two banks. One bank had already arranged 40% of the required capital and the remaining would be arranged this month, he added.

The other bank has shown a correspondence, which establishes that a Saudi Arabian investor is willing to invest in the bank.

He said the capital requirement of these three banks was less than 1% of the total assets of the banking system, yet the government would not take any risk and the depositors’ money would be saved.


Corporate results: Engro Polymer’s earnings slump By Our Correspondent


KARACHI:

Engro Polymer and Chemicals – a subsidiary of Engro Corporation – has posted net earnings of Rs123 million during the first six months of calendar year 2014 (1HCY14), down 71% year-on-year (YoY) compared with Rs425 million in the same period of previous year.

Earnings per share (EPS) declined to Rs0.19 during the six-month period compared to previous year’s Rs0.64.

The company’s earnings declined due to a significant plunge in primary margins, and higher energy tariffs, Global Research reported on Wednesday.

On a quarterly basis, the company earned a profit of Rs148 million or an EPS of Rs0.22 during the first quarter of calendar year 2014 (1QCY14). Engro then recorded a loss of Rs25 million or an EPS of Rs0.04 during the 2Q CY14.



In a recent interview with The Express Tribune, Engro Polymer and Chemicals Chief Executive Officer (CEO) Khalid Siraj Subhani said 2014 would hopefully be a better year for the company. However, he mentioned that the slow market and the high price of some raw materials are challenges that can hurt the company’s profits.

After passing through three tough years, the company finally reported a net profit of Rs50 million in 2012, followed by gains of Rs717 million in 2013.

In the recent budget, the government has levied 5% duty on the import of some raw materials the company uses, which according to the CEO, will increase the cost of production by Rs600-700 million. Moreover, the levy of Gas Infrastructure Development Cess (GIDC) is also going to dent its profits by Rs800-900 million per annum.

The main product of Engro Polymer and Chemicals is Poly-Vinyl-Chloride – commonly known as PVC. The company meets about 80% of the total PVC demand of the country, while the rest of the 20% demand is being met by the imports.

The company’s top-line declined 1% YoY to Rs11.90 billion during 1HCY14 because of lower volumetric sales. On a QoQ basis, the company’s revenue surged 22% to Rs6.53 billion during 2QCY14 because of higher volumetric sales.

Earlier during the 1QCY14, due to uncertainty regarding the Pakistan rupee and the dollar parity, dealers were delaying their PVC purchases in anticipation of lower prices.

However, once the exchange rate settled, the dealers resumed their purchases. In addition, the second quarter is generally a period during which construction activities are relatively active, leading to additional demand of PVC.

The company’s financial charges declined 54% YoY to Rs297 million during 1HCY14 because of an exchange gain of Rs191 million registered during 1QCY14 as the rupee appreciated by 6%. On a QoQ basis, financial charges ramped up 11 times to Rs273 million because of the absence of an exchange loss.




OPEN MARKET FOREX RATES Updated at: 7/8/2014 7:01 AM (PST)

Currency Buying Selling Australian Dollar 91.4 91.65 Bahrain Dinar 262.35 262.6 Canadian Dollar 89.25 89.5 China Yuan 15.9 16.05 Danish Krone 17.7 17.85 Euro 131.5 131.75 Hong Kong Dollar 12.55 12.7 Indian Rupee 1.61 1.64 Japanese Yen 0.966 1.02 Kuwaiti Dinar 348.75 349 Malaysian Ringgit 30.6 30.85 NewZealand $ 83.65 83.9 Norwegians Krone 15.45 15.6 Omani Riyal 256.45 256.7 Qatari Riyal 27 27.25 Saudi Riyal 26.15 26.4 Singapore Dollar 78.5 78.75 Swedish Korona 14.2 14.35 Swiss Franc 108.75 109 Thai Bhat 3.05 3.1 U.A.E Dirham 26.8 27.05 UK Pound Sterling 166 166.25 US Dollar 98.8 99.05



INTER BANK RATES Updated at: 7/8/2014 7:01 AM (PST)

Currency Bank Buying TT Clean

Bank Selling TT & OD

Australian Dollar 91.52 91.71

Canadian Dollar 89.74 89.93

Danish Krone 17.64 17.68

Euro 131.54 131.81

Hong Kong Dollar 12.70 12.72

Japanese Yen 0.9594 0.9614

Saudi Riyal 26.24 26.29

Singapore Dollar 78.81 78.97

Swedish Korona 14.28 14.31

Swiss Franc 108.19 108.41

U.A.E Dirham 26.79 26.84

UK Pound Sterling 166.01 166.34

US Dollar 98.4 98.6



Bullion Rates (Gold Prices) in Pakistan Rupee (PKR) As on Thu, Aug 07 2014, 03:30 GMT

Metal Symbol PKR for 10 Gm

PKR for 1 Tola

PKR for 1 Ounce

Gold 24K XAU 41,467 48,316 128,981

Palladium XPD 27,106 31,583 84,310

Platinum XPT 46,500 54,181 144,635

Silver XAG 637 742 1,982

Gold Rates in other Major Currencies

Currency Symbol 10 Gm 1 Tola 1 Ounce

Australian Dollar AUD 452 527 1,407

Canadian Dollar CAD 459 534 1,426

Euro EUR 314 366 976

Japanese Yen JPY 42,937 50,029 133,551

U.A.E Dirham AED 1,543 1,798 4,800

UK Pound Sterling GBP 249 290 775

US Dollar USD 420 490 1,307

* These rates are taken from International Market so there may be some fluctuation from Local

Market.

http://www.forex.pk/bullion-rates-gold-24k-xau-pkr.php

http://www.forex.pk/bullion-rates-palladium-xpd-pkr.php

http://www.forex.pk/bullion-rates-platinum-xpt-pkr.php

http://www.forex.pk/bullion-rates-silver-xag-pkr.php

http://www.forex.pk/bullion.php?base=AUD&curr=XAU&type=ounce

http://www.forex.pk/bullion.php?base=CAD&curr=XAU&type=ounce

http://www.forex.pk/bullion.php?base=EUR&curr=XAU&type=ounce

http://www.forex.pk/bullion.php?base=JPY&curr=XAU&type=ounce

http://www.forex.pk/bullion.php?base=AED&curr=XAU&type=ounce

http://www.forex.pk/bullion.php?base=GBP&curr=XAU&type=ounce

http://www.forex.pk/bullion.php?base=USD&curr=XAU&type=ounce

Documents

Thursday, news August 07, 2014 updates - …imranghazi.com/mtba/downloads/News/2014/News 07 Aug 2014 Email No...... 10 Lahori Group' calling the shots at Prime Minister's office