Friday, October 31, 2008

Belgium swaps Euro 30 million as assistance for quake-hit areas: APP

ISTANBUL, Oct 31 (APP): Prime Minister Syed Yousuf Raza Gilani on Friday expressed gratitude to Belgium for swapping its debt of Euro 30 million as assistance for reconstruction of 2005 earthquake hit areas. In his meeting with the Belgian Foreign Minister, the Prime Minister underscored the importance that Pakistan attached to its relations with Belgium. The Belgian Foreign Minister condoled the loss of lives and property in Balochistan earthquake. He informed the Prime Minister that Belgium was planning to send the relief assistance for earthquake affectees.

Both the leaders agreed to convene the meeting of Pak-Belgium Joint Commission in the coming months to reinvigorate their cooperation in the area of trade, investment, education, IT and scientific fields.

On the request of the Prime Minister for Belgium support to Pakistan’s case for inclusion in the GSP plus scheme and initiation of FTA talks with the EU, the Belgian Foreign Minister stated that his government would give these matters sympathetic consideration.

The Belgian Foreign Minister requested briefing from the Prime Minister on Pakistan’s counterterrorism campaign, on chances of success of US and NATO military campaign to root out extremists from Afghanistan and Pakistan’s assessment of the overall situation in the region.

The Prime Minister highlighted the fact that all the allied forces must strive to win hearts and minds of the people rather than relying exclusively on the military means to win against extremists and militants in Afghanistan.

For more on this article, please click on the following link: Belgium swaps Euro 30 million as assistance for quake-hit areas: APP

Thursday, October 30, 2008

Pakistan's Economy:Treacherous ground: Economist

Oct 30th 2008 | DELHI

From The Economist print edition

An earthquake adds to Pakistan’s woes

ON TOP of a bloody insurgency and a listing economy, Pakistan must now contend with a natural calamity. Before dawn on October 29th, an earthquake of magnitude 6.4 or greater struck the mountainous province of Baluchistan not far from its capital, Quetta. The death toll quickly exceeded 200.

It was the biggest earthquake since one in October 2005 that killed over 70,000 in Pakistan-controlled Kashmir. After that catastrophe, America spent almost $1 billion on relief operations, ferrying supplies to mountain villages by Chinook helicopter. According to one American official, cited by an independent working group on Pakistan policy, the goodwill America earned represents “the most successful strategic confrontation to date in the battle with the terrorists in South Asia.”

Even before the latest earthquake, Pakistan was again hoping its strategic position would persuade the world to rush to its aid. The ground is giving way beneath its economy. A distracted, overstretched government has allowed inflation to soar (see chart), the rupee to plummet and foreign-exchange reserves to seep away. On October 17th the central bank’s stash of hard currency was just over $4 billion, enough to cover just four to five weeks of imports.

Pakistan hoped for an infusion of cash from the “Friends of Pakistan”, an informal circle including China, America and Saudi Arabia. But to its dismay, only the IMF appears ready to offer the sums it needs as quickly as it needs them. The IMF is expected soon to approve a loan of up to $12 billion, probably spread over two years.

Pakistan and the IMF may not be “friends”; but nor are they strangers. Some of the politicians and civil servants now in power were “pretty traumatised” by the IMF programmes they endured during the 1990s, says Mohsin Khan of the fund. In those days, the IMF twisted their arms to make tough fiscal commitments they could not keep. In 2005 the military regime, having proudly turned down the last two instalments of its loan, declared that it had “broken the begging bowl forever”.

For more on this article, please click on the following link: Pakistan's Economy:Treacherous ground: Economist

Sporting arms export to be raised to $100m by 2011: The News

Friday, October 31, 2008
By Qaiser Khan Afridi

PESHAWAR: The Pakistan Hunting and Sporting Arms Development Company (PHSADC) would upgrade the most neglected industry, claiming to achieve $100 million export target by the year 2011.

Briefing journalists at the Small and Medium Enterprises Development Authority (SMEDA) office on Thursday, the newly-appointed chairman of the PHSADC and a leading industrialist, Nauman Wazir, said the company was incorporated in 2006 under the Companies Ordinance 1984, working under the Ministry of Industries, Production and Special Initiatives. He, however, lamented that officials in the past failed to promote the arms industry. “During the past two years, the officials did not perform well to boost this sector, but I am committed to unleash the hidden potential, which can earn the country millions of dollars in the coming three years,” Nauman Wazir said.

For more on this article, please click on the following link: Sporting arms export to be raised to $100m by 2011: The News

Six hydropower projects to be initiated by 2010: The News

Friday, October 31, 2008
By our correspondent

LAHORE: In addition to initiating construction work on the 4,500 MW Diamer-Basha Dam Project next year, another half dozen mega hydropower projects including Kohala, Dasu, Bunji, Munda, Palas Valley would be undertaken in 2010-12.

This was stated by WAPDA Chairman Shakil Durrani during a briefing here at WAPDA House today arranged for a delegation of the 89th Management Course of National School of Public Policy, Lahore led by its Rector Lt. Gen. (R) Javed Hassan. These projects would generate about 21,000 MW of electricity on their completion and help improve low-cost hydropower proportion in the national grid.

The delegation was briefed that Pakistan has been blessed with the identified hydropower potential of more than 54,000 MW but only 16 per cent of this potential has so far been taped due to variety of reasons.

After its bifurcation last year, WAPDA is fully focused on water and hydropower development. The work on 969 MW Neelum-Jhelum Hydroelectric Project has already started, while feasibility studies and detailed engineering designs of most of the mega projects in both water and power sectors are currently at the advance stages and likely to be completed by the next year,

The delegation was informed that Pakistan is storing only 11 per cent of the annual water flows of its rivers and, if this capacity is not increased, Pakistan will be a water short country by 2012. The delegation was told that the accumulative gross storage capacity of Tarbela, Mangla and Chashma reservoirs that originally used to be 18.37 million acre feet (MAF), has reduced to 13.24 MAF due to sedimentation, resulting in 28 per cent loss of storage capacity.

For more on this article, please click on the following link: Six hydropower projects to be initiated by 2010: The News

Expo Pakistan 2008 : $50m worth of business generated: Daily Times

By Tanveer Ahmed

KARACHI: Expo Pakistan 2008 has generated $50 million worth of business in the form of the export orders signed between local companies and foreign buyers.

“It will likely touch $100 million mark in the coming days when the business deals signed during the event will materialise,” Syed Mohibuallah Shah, Chief Executive Trade Development Authority of Pakistan (TDAP) told a news conference on Thursday at the concluding day of Expo Pakistan, which began on October 27, 2008.

“Only one business deal between a Korean company and local ethanol firm amounted to $10 million,” he informed Describing the mega trade and export promotion event of the country as successful venture by attracting more foreign buyers compared to previous exhibitions Shah said that successful holding of the event will help improve the image of the country. The participation of foreign buyers and local companies was so overwhelming that the available space in the Expo Centre became insufficient to cater such a large number of participants.

For more on this article, please click on the following link: Expo Pakistan 2008 : $50m worth of business generated: Daily Times

Cellphone market touching saturation level: Dawn

By Imran Ayub

KARACHI, Oct 30: The cellular subscriber base in the country witnessed a slow growth in the second quarter, which stood at 2.4 per cent by September 2008, as experts see mobile phone consumers’ market touching the saturation level.

Though the cellular subscriber base crossed 90 million mark by the end of September 2008, figurers compiled by the telecom regulators and cellular companies suggest that the sales of new connections are on the decline for the last few months compared with previous years, as rising inflation has also seriously affected the purchasing power of consumers.

“As we go through figures, total new connections added in August stood at 238,000 while in September they were recorded at 640,000,” said a telecom industry source, citing fresh data.

August and September are the two lowest registered sale months of new connections since monthly reporting began in 2005 by the companies and naturally it directly depends on people’s needs and their strength to acquire that. “We have witnessed both on the decline for the last few months,” said the source.

Blocking of unregistered SIMs (subscriber identity modules) by all cellular companies in line with the directives of the Pakistan Telecom Authorities (PTA) following recommendations of the law enforcement agencies, also resulted in recent decline to some extent, observed the source.

A phenomenal jump in the number of cellphone subscribers has been witnessed since 2004, when two foreign cellular service providers launched their operations in the country.

For more on this article, please click on the following link: Cellphone market touching saturation level: Dawn

WSJ slams IMF's prescriptions: Business Recorder

NEW YORK (October 30 2008): An influential US newspaper has criticised the prescriptions of the International Monetary Fund (IMF)--cuts in government expenditures, devaluation, and tax increases--for bailing Pakistan out of the financial crisis, saying that the measures would have opposite effect.

"Pakistan needs market-oriented reform along the Chilean and Irish models, not the IMF's austerity prescriptions," The Wall Street Journal said in an editorial, titled 'Does the IMF have no fresh ideas?' "Pakistan's economic wellbeing matters not only for its 165 million citizens but also because it's a key country in the world-wide war on terror," the editorial said.

The Journal said the IMF declined comment on a Pakistan Finance Ministry spokesman's statement last week that the Fund "wants Pakistan to reduce its government expenditures, maintain a 'flexible' exchange rate and 'increase' its tax-to-GDP ratio".

For more on this article, please click on the following link: WSJ slams IMF's prescriptions: Business Recorder

Wednesday, October 29, 2008

Pakistan Isn’t Cambodia: Denver Post

I’ve seen occasional recent references comparing Pakistan to Cambodia during the Vietnam War. If the Bush administration, or Barack Obama, thinks the two are comparable it is making the biggest miscalculation since the U.S. made the mistake of getting too close to China in the Korean War. Obama wants to expand the current Bush attacks on border areas to include an attack on Osama bin Laden where ever he might be in Pakistan.

U.N. forces had routed the North Korea Army and appeared to on the verge of winning when China became concerned that the Americans might decide to go ahead and conquer China as well because China had been supplying the North Koreans. China responded by sending in its army. President Harry Truman decided that it was best not to antagonize the Chinese any more than necessary and prohibited bombing supply bases in China.

Enemies using sanctuaries isn’t a new situation for the U.S. Andrew Jackson faced such a situation along the border of what was then Spanish owned Florida during the administration of President James Monroe. Jackson took care of the problem by in effect declaring war on Spain with nothing more than an ambiguous letter from President Monroe. Jackson invaded Florida without any authorization from Congress and captured the Spanish governor at a poorly defended fort at Pensacola. Spain after a protest decided Florida wasn’t worth the trouble and ceded it to the U.S.

For more on this article, please click on the following link: Pakistan Isn’t Cambodia: Denver Post

Temasek to invest up to $147m in NIB Bank: The News

Thursday, October 30, 2008
KARACHI: Singapore’s sovereign wealth fund Temasek Holdings has agreed to a further investment of up to 12 billion rupees ($147 million) in Pakistan’s NIB Bank via a rights issue, NIB said.

Temasek, already NIB’s largest shareholder with 63.15 per cent, will participate in the bank’s 12 billion rupee rights issue and subscribe for shares not taken up by minority holders.

The rights issue will be offered to all existing shareholders at a ratio of 42.198 shares at par value, which is 10 rupees per share, for every 100 shares held as of Nov 19.

NIB shares last traded at 8.45 rupees each, giving it a market value of close to $300 million.

For more on this article, please click on the following link: Temasek to invest up to $147m in NIB Bank: The News

Japanese IT firm to invest $50m: Dawn

KARACHI, Oct 29: DTS Inc., a Japanese IT company, plans to invest $50 million in the next five years by setting up a call centre, data centre and Japanese language centre in Karachi.

DTS Director Irfan Siddiqui in a statement on Tuesday said that the investment would generate over 1,500 jobs and the company would proceed towards manufacturing of computer hardware and IT-related products as well.

For more on this article, please click on the following link: Japanese IT firm to invest $50m: Dawn

Monday, October 27, 2008

Global crisis hits India’s exports: The News

Tuesday, October 28, 2008
NEW DELHI: The global economic crisis has hit India where it hurts the most as over a dozen job-oriented export sectors slipped into disarray showing up to 70 per cent negative growth last month over a year-ago period, the Press Trust of India news agency reported on Monday.

Alarmed by sharp decline in export value in tea (-20 per cent), handicrafts (-70 per cent), carpets (-32 per cent), oil meals (-50 per cent), man-made yarn (-17 per cent), cotton yarn (-19 per cent) and marine products (-19 per cent), the commerce ministry is likely to recommend the lifting of export curbs on items like steel and agro products.

At a high level meeting, convened by Commerce Secretary G K Pillai on October 24, it was pointed out that the government needs to “re-look” at all export restrictions. “The global financial crisis is significantly impacting Indian exports and the impact could be more in the coming days,” said an official involved in the stock-taking exercise.

For more on this article, please click on the following link: Global crisis hits India’s exports: The News

Asian Beach Games in Bali Pak finishes at 11th place: The Frontier Post

BALI (APP): Pakistan finished at 11th place in the inaugural Bali Asian Beach Games which concluded here on Sunday amid festivity and colour at a closing ceremony. Hosts Indonesia lived up to pre-games expectations by finishing at the top with 23 gold,8 silver and 20 bronze with a total medal tally of 51. Thailand finished at runners up spot with 10 gold, 17 siler and 10 bronze (total 37 medal). While China claimed third place having won 6 gold, 10 silver and seven bronze, taking altogether 23 medals. South Korea was at fourth place with 4 gold,7 silver and 10 bronze while Japan took the 5th place with 3 gold,3 silver and 3 bronze. At 6th place were Chinese Hong Kong with 3 gold,3 silver and 2 bronze with India getting 7th position with 3 gold and 2 bronze. Vietnam got 2 gold,5 silver and 3 bronze for 8th place and Myanmar bagged 2 gold,2 silver and 6 bronze for the 9th lace.At 10th position was Malaysia with 2 gold, 2 silver and six bronze. Pakistan won 2 gold, one each in Handball in which they beat Kuwait , one gold in wrestling through Ghulam Haider as Muhammad Ali collected a silver.

For more on this article, please click on the following link: Asian Beach Games in Bali Pak finishes at 11th place: The Frontier Post

Sunday, October 26, 2008

‘Pakistan to move WB against India over water issue’: Pakistan Link

NEW DELHI/ISLAMABAD: Pakistan will go to the World Bank (WB) to seek compensation from India for obstructing water flow in the Chenab River and design defects in Baglihar Dam, Indus Water Commissioner (IWC) Jamaat Ali Shah said on Saturday. He was talking to Indian reporters at the Indra Gandhi Airport before leaving for Pakistan. He said he had visited the Doda district in Indian-held Kashmir and found several defects in Baglihar Dam. Shah said India had taken 200,000 cusecs of Pakistani water in September ‘in utter violation of the set laws’, hurting Pakistan’s Kharif crops. The two rounds of talks had ended inconclusively, he said, adding India was sticking to its ‘traditional obduracy and inflexibility’. “Talks were held with the Indian officials at length, but I am not satisfied.”

For more on this article, please click on the following link: ‘Pakistan to move WB against India over water issue’: Pakistan Link

Pakistan Extends August Stock Trading Curbs Until Oct. 31: Bloomberg

By Farhan Sharif
Oct. 26 (Bloomberg) -- Pakistan extended trading restrictions on its stock market for the third time in a month to prevent a further slide.
``Some time is still required for the implementation of market stabilization measures,'' Adnan Afridi, managing director of the Karachi Stock Exchange told reporters today. Shaukat Tarin, the Prime Minister's finance adviser will visit the exchange on Oct. 31, after which a decision about ending curbs will be taken, he said.
The Karachi Stock Exchange's benchmark KSE 100 Index has lost more than one-third of its value this year. Board members met over the weekend to discuss extending the curb, which was scheduled to be lifted on Oct. 27. The board also discussed ways to prevent possible violence by angry investors.

For more on this article, please click on the following link: Pakistan Extends August Stock Trading Curbs Until Oct. 31: Bloomberg

China assures to stand by all weather ally Pakistan: PTI

Islamabad, Oct 26 (PTI) Pakistan has been assured by it's all weather ally China that it will stand by it under all circumstances and strengthen their strategic partnership.The assurance to this effect was re-conveyed by the Chinese leaders to Prime Minister Syed Yousuf Raza Gilani during his visit to Beijing that concluded yesterday, Pakistan Ambassador to China Masood Khan said.China said it will help safeguard Pakistan's sovereignty and territorial integrity, while maintaining existing strong bonds of friendship.It was both symbolic and substantial in nature that helped to reinforce strong commitment of the two countries to push forward their decades' old relationship, as strong time-tested traditional allies in the region, the envoy said commenting on Premier Gilani's just concluded visit to Beijing for Asia Europe meet.Gilani during his interactions with the Chinese Premier Wen jiabao received strong indications that China will continue to help Pakistan to meet new challenges, in the wake of terrorism and financial crisis.China said it support's Pakistan's stand on counter-terrorism, normalisation of its relations with India and role as a front-line state to wipe out menace of terrorism, the Ambassador said, according to the official APP news agency.

For more on this article, please click on the following link: China assures to stand by all weather ally Pakistan: PTI

Friday, October 24, 2008

Pakistan overcome Qatar to reach final: Gulf Times

By John Verghese

BALI, Indonesia: Pakistan overcame Qatar 2-1 in a tense penalty shootout to enter the final of the handball competition at the Asian Beach Games here yesterday.
Pakistan won 8-10, 7-4, 11-10 in a late evening match to set up a title clash tomorrow with Kuwait, whom they beat in their preliminary pool match.
The Qatar team which lost to Thailand in their preliminary pool match will face them again in a play-off for the bronze medal tomorrow.
Earlier, Kuwait put it across Thailand 2-1 winning at 13-14, 10-8, 5-4 in the first semifinal.
Meanwhile, Indonesia increased their lead at the top of the medals tally, picking up one more gold in surfing yesterday for 14 gold, five silver and 10 bronze and a total of 29 medals. Thailand continue in the second spot with four gold, six silver and four bronze for a total of 14 medals.
Vietnam are third best with two gold, five silver and two bronze for an aggregate of nine medals. India continue to be in the eighth spot with two gold and one bronze for a total of three medals. While Philippines are lying in the 15th position with one silver and seven bronze medals for a tally of eight medals, Pakistan are in the 16th spot with one silver and one bronze for a total of two medals.
In the handball final, unless strong contenders Kuwait produce an inspired performance, Pakistan, who have looked the best team in the competition so far now appear well set to claim the gold in the absence of Asian powers China and South Korea, who have not fielded teams in the men’s category.
Pakistan took time to get their moorings in the match but settled down well to give Qatar a stern challenge. After losing the first period, Pakistan came back strongly tightening their defence while at the same time attacking with greater vigour to finish on top in the second period.
In the shoot-out, for Pakistan, Babar Sultan and Mohamed Sohaib were successful with both their attempts. Nasrullah and Mohamed Pervaiz scored the other goals. Azhar Khan was the lone player to have his attempt blocked.
For Qatar, Mahfoud Boumaraf scored from both his attempts. Waleed al-Nobi, Omar al-Khelaifi and Ahmed Naili were the other goal-getters. Abdulla al-Khatar fumbled with his attempted low shot.
Al-Nobi, who touched the goal area line with his second attempt in the shoot-out, had his goal disallowed by the referee resulting in Pakistan’s 11-10 victory.
Pakistan goalkeeper Tahir Ali was visibly pleased with his team’s entry into the final.
“It was a thrilling match and our team worked really hard to do well in this competition. The result could have gone either way but Allah was with us today. The fact that the Qatar player scored the goal in the shoot-out before it being disallowed by the referee shows it was divine providence,” Ali told Gulf Times yesterday.

For more on this article, please click on the following link: Pakistan overcome Qatar to reach final: Gulf Times

Pakistan Prefers Friends’ Aid
to IMF Package: Khaleej Times

ntensive Pakistan-IMF consultations have been taking place in Dubai since Tuesday, for a bailout plan to avert possible debt default.

Pakistan has been trying to get International Monetary Fund endorsement for its current strategies for economic recovery that is imperative to persuade other multilateral lenders and friendly countries to come to its rescue.

Islamabad immediately needs 4 to 5 billion dollars to stabilise the economy and enhance confidence in its financial system — a pre-requisite to arrest ever-widening gap in balance of payments position amid rapidly depleting reserves and steep slide in rupee value. High inflation (25 per cent), unsustainable budget deficit, liquidity squeeze in the banking system due to government borrowing has multiplied economic woes.

It is apparent that both sides have agreed in principle on the need for help that was decided in their meetings in Washington in September. But Pakistan insists the IMF is only the last option and the current talks are a health-check and assessment of its financial restructuring plan, which does not include IMF funding at this stage. The plan is already underway to control expenditures side by doing away with subsidies on POL and electricity.

“It is not an extraordinary meeting but, yes, the circumstances have made it so”, says the Adviser Finance Shaukat Tareen. The IMF also confirms a formal request has yet to come but has been encouraging Islamabad to accept funding that may go up to $7 to 10 billion during next two years. The last time Pakistan came off an IMF programme was in December 2004, vowing it would never borrow from the agency again.

For more on this article, please click on the following link: Pakistan Prefers Friends’ Aid
to IMF Package: Khaleej Times

Thursday, October 23, 2008

Pakistan to Start Put Options for Overseas Investors: Bloomberg

By Farhan Sharif and Pooja Thakur

Oct. 23 (Bloomberg) -- Pakistan's stock regulator will allow foreign investors to buy put options in seven state-run companies, before lifting trading curbs that have prevented equity sales for almost two months.

The government will guarantee up to 30 billion rupees ($369 million) to enable state-run funds to write put options on Oil & Gas Development Co. and six other stocks, the Securities & Exchange Commission said yesterday. The regulator also approved a 20 billion-rupee fund to buy equities.

The measure may encourage investors to hold onto their shares when trading restrictions are lifted on Oct. 27, capping further declines in the KSE100 Index that has lost more than a third of its value this year. Since the limits were imposed, the government has approached the International Monetary Fund for a bailout to avoid defaulting on its debt, deterring investors.

``If in one year's time, the situation improves globally and in the local market, they will benefit instead of selling their holdings at this point,'' said Tariq Iqbal Khan, chairman of National Investment Trust, Pakistan's biggest asset manager. ``If these foreign investors accept the option, and do not sell in the ready market, the overall selling pressure will be lightened.''

Overseas investors who held shares in the market on Aug. 27, when the government capped a decline in its benchmark KSE100 Index, will be able to buy these options, the regulator said.

A put option is an agreement that gives the buyer the right to sell a specific quantity of a particular security by a certain date. The option is not obligatory and is traded during its life. The holder hopes the stock will drop in price.

For more on this article, please click on the following link: Pakistan to Start Put Options for Overseas Investors: Bloomberg

Wednesday, October 22, 2008

Pakistani students resist global favourite Obama: Daily Times

* Students at two top universities term Democratic presidential hopeful ‘too aggressive’, ‘irresponsible’, ‘enemy of Muslims’
* Say Obama’s stance on Pakistan ‘even more dangerous than George W Bush’

Daily Times Monitor


LAHORE: Democratic presidential hopeful Barack Obama may be winning in the United States and most global popularity polls, but he is a loser in Pakistan, Washington Times reported on Tuesday.

Aggressive:

Dozens of students interviewed at two top universities in Lahore rejected Obama as ‘too aggressive’, ‘irresponsible’ and an ‘enemy of Muslims’, whose stated policy toward insurgency-plagued areas would make a bad situation worse.

The anti-Obama sentiments stem from assertions on the campaign trail that the senator from Illinois, if elected president, would authorise US forces to enter Pakistani territory to hunt down the Taliban and Al Qaeda.

“The only country he's talking about bombing today is us,” said Sher Afghen Malik, a political science major at the University of the Punjab, to the approving nods of classmates. “How could we possibly support him?”

Dangerous: Khansa Qamar, a member of the school's model United Nations club, said her peers perceive Obama “as even more dangerous than George W Bush” with regard to his stance on Pakistan.

By a show of hands, not one among the two-dozen students in one class supported the Democratic candidate. A little more than half said they prefer Senator John McCain because the Republican presidential candidate's statements on Pakistan have been less pointed.

Obama’s comments set Pakistan's media machine on spin cycle, hardening the views of many people who otherwise had been supportive of him, said Khalid Butt, a political science instructor at Government College in Lahore.

For more on this article, please click on the following link: Pakistani students resist global favourite Obama: Daily Times

Bond spreads hit record high: bworldonline

HONG KONG — Asian bond spreads widened to record levels yesterday as fears about a balance of payments crisis in Pakistan and Argentina’s takeover of its private pension system rocked confidence in broader emerging markets.

Fears about Asian companies also deepened after S&P and Moody’s downgraded ratings on Chinese conglomerate CITIC Pacific , which this week revealed a potential $2 billion loss on unauthorized currency trades.

"There’s a scare going on in emerging markets overall. Yesterday there were jitters about Pakistan, and right now, adding to the pressure is the news from Argentina," said a Manila-based bond trader.

The iTRAXX investment-grade index widened by by about 40 basis points (bps) to 380.

The equivalent high-yield index jumped some 100 bps to as high as 1,200.

Both marked new records levels, a Hong Kong-based trader said.

The steep widening comes amid concerns about the deteriorating health of emerging markets. Pakistan is feared to be in critical condition as the central bank holds barely enough foreign currency to cover six weeks of imports and was expected to seek IMF help.

Shaukat Tarin, economic adviser to the prime minister of Pakistan, told Dawn News on Tuesday that the country required up to $15 billion of support from foreign lenders to avert a crisis.

Also on Tuesday, news that Argentina will take over its $30 billion private pension system in order to guarantee payments to retirees sent the country’s stocks and bonds tumbling.

For more on this article, please click on the following link: Bond spreads hit record high: bworldonline

Tuesday, October 21, 2008

BD shows interest in defence equipment: Dawn

By Iftikhar A. Khan

ISLAMABAD, Oct 21: The visiting army chief of Bangladesh, Gen Moeen U. Ahmed, has expressed interest in purchasing military equipment from Pakistan and sought the country�s assistance in upgrading a fleet of T-59 tanks through a joint venture.

He met the Joint Chiefs of the Staff Committee Chairman, Gen Tariq Majid, on Tuesday.

The Bangladesh�s army chief, who is here on a six-day official visit, also held meetings with Chief of the Army Staff Gen Ashfaq Parvez Kayani and Defence Minister Chaudhry Ahmad Mukhtar.

During his meeting with the JCSC chairman, he showed interest in obtaining assistance in the overhauling of Bangladesh Air Force (BAF) aircraft, holding of Special Forces joint exercises with Pakistan and the purchase of communications equipment.

Gen Moeen also proposed to exchange instructors at the staff college level on mutual basis. He exchanged views focusing on matters of mutual interest, regional security and enhancement of defence ties.

Gen Tariq Majid highlighted the importance of special relations that exist between the two countries, which are characterised by religious affinity and commonality of views.

Both expressed satisfaction on the present level of military cooperation and stressed to further enhance the ties by holding joint training exercises, courses, joint venture in defence production and purchase of defence equipment.

Gen Majid said that Pakistan and Bangladesh share common perception on regional and international issues and emphasised the need to enhance common efforts and cooperation to further develop upon common objectives.

Gen Moeen U Ahmed visited the General Headquarters and called on Chief of the Army Staff General Ashfaq Parvez Kayani.

Both sides agreed to enhance their existing level of defence relationship.

They also discussed strategic issues to develop common understanding.

On arrival at the General Headquarters, General Moeen U Ahmed was presented a guard of honour. He reviewed the parade and took salute from smartly turned out contingent of the Pakistan Army.

For more on this article, please click on the following link: BD shows interest in defence equipment: Dawn

Legend Holger Runs Coaching Clinic In Pakistan: Goal.com

FIFA Coaching Instructor Holger Obermann,72, who will be conducting Football for Hope Clinics III in the earthquake affected areas of Pakistan under Football for Hope Program, opened the two-day Clinic at Rawalakot on Tuesday.

FIFA Assistant Development Officer Mohsen Gilani and PFF Co-ordinator Akhtiar Ullah are assisting the German coach in the third edition of Football for Hope Clinics.

According to the information provided by Pakistan Football FA, FIFA earlier despatched Holger Obermann to Pakistan in Aug-Sep 2006 and Feb-March 2007 - making it three times in 26 months. The earthquake that hit northern areas of Pakistan and parts of Azad Kashmir on 8 October 2005, claimed more than 75,000 lives.

The German-based coach oversaw a programme of Football Clinics offering a new perspective on the future to young people affected by the Earthquake 2005. The social dimension of the game in emerging and conflict-ridden countries has long been a key priority for FIFA.

For more on this article, please click on the following link: Legend Holger Runs Coaching Clinic In Pakistan: Goal.com

IMF offers $6bn package: Dawn

By Anwar Iqbal

WASHINGTON, Oct 21: The United States has repeated its offer to help rescue Pakistan from the current financial crisis as diplomatic sources in Washington say the International Monetary Fund has agreed to provide $6 billion to the country to boost up its ailing economy.

�It�s hard for me to speculate,� said State Department�s deputy spokesman Robert Wood when asked if the IMF had agreed to offer a rescue package to Pakistan. But �we obviously will try to see what we can do to help Pakistan get through its financial crisis�.

Pakistan had �no choice but to seek help from the IMF,� said another State Department official. The official, who was not identified, was quoted in the US media as saying that Pakistani officials knew it would not be a popular decision in Pakistan but they had to go to the IMF.

�It won�t be popular with the public and it sends a lot of negative signals about Pakistan�s financial situation, its creditworthiness. But it�s a decision the Pakistanis are going to have to make,� he said.

The country�s inflation is running at around 25 per cent, and its foreign currency reserves are rapidly depleting, forcing the government to seek emergency cash advance from friendly countries and international financial institutions.

For more on this article, please click on the following link: IMF offers $6bn package: Dawn

MCB Plans Takeovers as Crisis Pushes Pakistan's Banks to Merge: Bloomberg

By Naween A. Mangi

Oct. 21 (Bloomberg) -- MCB Bank Ltd., Pakistan's biggest by market value, plans to acquire domestic rivals as the nation's deepest economic crisis in a decade and tighter central bank rules push more lenders to consolidate.

``We have excess capital and we want to deploy it in assets that make sense for us,'' Chief Executive Officer Atif Bajwa said in an interview in Karachi yesterday. He didn't say which banks he was evaluating. ``The advantage of looking to get something now is that asset prices are low.''

Central Bank Governor Shamshad Akhtar last month increased banks' capital requirements almost fourfold within five years to spur mergers and reduce risk. Bajwa will need to grapple with Asia's highest borrowing costs and a faltering economy that forced Pakistan to seek a $10 billion bailout to avoid default.

``There's going to be a domestic scenario of acquisitions and mergers in which MCB will be a prominent player,'' said Saad Bin Ahmed, head of research at Karachi-based Capital One Equities Ltd., who rates MCB's stock ``hold.'' ``MCB is part of a group which is financially very strong.''

For more on this article, please click on the following link: MCB Plans Takeovers as Crisis Pushes Pakistan's Banks to Merge: Bloomberg

Pakistan’s banking system remains unhurt by financial market turmoil: SBP Governor: APP

KARACHI, Oct 21 (APP): Banking system of Pakistan has escaped the major ravaging effects of the recent financial market turmoil emerging from the US and engulfing the developed European economies. This was stated by Governor, State Bank of Pakistan (SBP), Dr. Shamshad Akhtar while speaking at the Asian Banker Dialogue on “The Banks We Like : and the Impact of the Global Financial Crisis on Pakistan’s Banks” here at a hotel on Tuesday.

The SBP Chief, however observed “In my assessment, Pakistan’s economy to- date has been affected mainly by the indirect impact of global events which led to the rise in the global commodity prices.”

Pakistan is perhaps the worst hit economy by the surge in global commodity prices as it has been a predominant factor in derailing the macro-economic fundamentals, she remarked.

Citing an example to explain this situation, she said almost 80 percent of the external current account deficit in FY08 is equivalent to the oil import bill which shot up to more than dollars 11 billion in FY08 as compared to below dollars 3 billion a few years back. Similarly, a large increase in FY08 fiscal deficit is on account of delay in pass-through of the international price hike at retail level, she observed.

Dr Akhtar said the financial markets in Pakistan have not been hit by the subprime markets or the associated contagion directly as Pakistan’s banking system from July 2007 to September 2008 did not face any liquidity problems. With strong regulatory oversight, we have seen significant enhancement of capital and capital adequacy ratio supported by high provisioning requirements.

For more on this article, please click on the following link: Pakistan’s banking system remains unhurt by financial market turmoil: SBP Governor: APP

Monday, October 20, 2008

Indian rupee weakens: The News

Tuesday, October 21, 2008
MUMBAI: The Indian rupee weakened on Monday as large dollar demand from importers offset gains in the local share market, with a cut in the central bank’s key lending rate providing only little respite.

The partially convertible rupee ended at 48.97/98 per dollar, 0.2 per cent weaker than 48.88/89 at close on Friday. It fell to 49.20 during trade, just short of its record low of 49.30 reached earlier this month.

“There was huge importer demand and there was also some defence-related dollar buying by state-run banks,” a senior dealer with a primary dealership said. “The central bank was expected to step in around 48.90, but they came in much later, pushing the rupee lower,” he said.

For more on this article, please click on the following link: Indian rupee weakens: The News

Saudi-Pakistan mutual investment fund aimed: Saudi Gazette

By Shahid Ali Khan Saudi Gazette
RIYADH – Participants at the one-day Saudi-Pak Investment Conference here Monday sought setting up of a Saudi-Pak mutual investment fund and launching of a cargo airline exclusively for two countries.
The proposals came up during the question and answer session held after Naveed Qamar, the visiting Pakistani Minister of Privatization and Investment, and Abdulrahman Al-Jeraisy, President of the Riyadh Chamber of Commerce and Industry (RCCI), jointly opened the conference. A similar event will also be organized at Jeddah Chamber of Commerce and Industry (JCCI) on Tuesday.
Qamar is leading a 150-member strong businessmen delegation to participate in the Saudi-Pak Investment Conference, considered to be first such event in the history of two countries.
The conference participants said the volume of export from Pakistan to Saudi Arabia was affected due to high freight charges levied by passenger airlines. A mutual investment fund and introducing a cargo airline service would go a long way and remove major impediments in trade between the two countries.
Dr. Amr Al-Dabbagh, Governor of Saudi Arabian General Investment Authority (SAGIA), and a number of prominent Saudi businessmen and investors and Pakistani Ambassador Shahid Kareemullah attended the conference.
Qamar called on Saudis to invest in his country, which he said was at the crossroads of financial uncertainty.

For more on this article, please click on the following link: Saudi-Pakistan mutual investment fund aimed: Saudi Gazette

Pakistan targets 50 bln rupees from T-bill auction: Reuters

KARACHI, Oct 20 (Reuters) - Pakistan's central bank said on Monday it would auction 50 billion rupees ($617 million) worth of three-, six-, and 12-month Treasury bills this week.

The auction will be on Wednesday, with settlement due the following day, the State Bank of Pakistan said.

For more on this article, please click on the following link: Pakistan targets 50 bln rupees from T-bill auction: Reuters

Rupee recovers 2.2pc against dollar: Dawn

KARACHI, Oct 20: The State Bank on Monday entered the exchange rate market with such strength that the rupee recovered 2.2 per cent against the dollar.

The rupee made recovery after long time as it has been falling frequently against the greenback.

Currency dealers provided different figures of dollars injected by the SBP in the market ranging from $100 million to $275 million. However, the SBP only confirmed its intervention without providing any details of the amount injected.

“The rupee surprisingly recovered from 83 to 81 against the greenback,” said a currency dealer, who believed that the SBP pumped $275 million during the trading.

However, others said the amount was not more than $100 million.

Currency dealers were surprised as to why the SBP intervened while its own reserves were falling.

For more on this article, please click on the following link: Rupee recovers 2.2pc against dollar: Dawn

Pakistan to produce 1,000 MW wind energy: The News

Monday, October 20, 2008
ISLAMABAD: Pakistan would be able to produce another 1,000 MW power through wind energy within the next few years, Director Technical Alternative Energy Development Board Irfan Afzal Mirza said on Sunday.

Talking to the Voice of Germany (VOG), he said approval to 23 projects had been accorded. Each project would be able to produce 50 MW power. So the country would produce 1000 MW energy through wind within the next three to four years.

For more on this article, please click on the following link: Pakistan to produce 1,000 MW wind energy: The News

Sunday, October 19, 2008

Pakistan central bank cuts cash ratio to inject liquidity: AFP

KARACHI (AFP) — Pakistan's central bank moved to inject liquidity into the country's struggling financial system on Saturday by cutting the amount of cash commercial banks must hold in reserve.

The bank lowered the cash reserve ratio two percentage points to six percent, and said it would be cut to five percent on November 15, as it sought to ease tight credit conditions that have hit economic demand around the globe.

Shamshad Akhtar, governor of the State Bank of Pakistan (SBP), said the move would inject 180 billion rupees (2.2 billion dollars) into the system and that the overall package would total 270 billion rupees.

"The State Bank will monitor the liquidity flow after the injection of massive liquidity into the banking system," she said.

"We would like judicious use of liquidity," she said, adding Pakistan's banking sector was "quite resilient and fully capable of withstanding market shocks and adverse macro economic conditions."

For more on this article, please click on the following link: Pakistan central bank cuts cash ratio to inject liquidity: AFP

India may pip Pakistan in beef consumption: USDA: Livemint

Buffalo meat consumption is likely to rise by 7% in India and by 2.28% in Pak; this could be because in India there’s no religious taboo on it, compared to cow beef and pork consumption

By PTI
New Delhi: People in India are likely to eat more beef and veal (meat of calves) in 2009 as compared to Pakistan, according to findings released in the latest US Department of Agriculture (USDA) report on ‘Livestock and poultry: World markets and trade’.
India’s demand for beef and veal is expected to be about 65% more than Pakistan at 1.9 million tonnes in the coming year. Veal is the meat of calves (young cattle). People in Pakistan are projected to consume 1.1 million tonnes of beef and veal.
The USDA report added that buffalo meat consumption is likely to rise by 7% in India and by just 2.28% in Pakistan. Buffalo meat consumption in India is rising as there is no religious taboo on it compared with cow beef and pork consumption.
Meanwhile, production of India’s beef and veal is expected to increase by over two-fold of Pakistan at 3.1 MT in 2009.
USDA data indicates that production in India is increasing on an average by 1-2 lakh tonnes year-on-year and is expected to ascend a healthy 5% to nearly 2.8 million tonnes in 2009.

For more on this article, please click on the following link: India may pip Pakistan in beef consumption: USDA: Livemint

Pakistan banks on other lenders saving it before IMF: Reuters

Pakistan - (Releads)

By Augustine Anthony

ISLAMABAD, Oct 18 (Reuters) - Pakistan might need to borrow from the International Monetary Fund if other multi-lateral lenders and friendly governments fail to help out in the next few weeks, the country's new troubleshooter said on Saturday.

A balance of payments crisis is expected to climax soon, but there was no danger of Pakistan defaulting on its international debt obligations, Shaukat Tarin said a day after returning from overseas visits to Washington and Beijing to drum up support.

"I am very confident that I have plans to make sure, whatever it takes, that we should build our reserves and that we do not default," said Tarin, appointed last week as adviser to the prime minister on economic affairs.

"Now, there is no danger," he told journalists after a news conference, but he said lenders were running out of time to come to Pakistan's rescue.

"We think we will be in very good shape ... within the next 30 to 60 days," Tarin said of the prospects of sewing up funds to cover a balance of payments financing gap that the IMF estimates at up to $4.5 billion, and Pakistan reckons at $3.0 billion for the fiscal year ending on June 30 next year.

For more on this article, please click on the following link: Pakistan banks on other lenders saving it before IMF: Reuters

Pakistan gets power plant deal: LA Times

From the Associated Press
October 19, 2008

ISLAMABAD, PAKISTAN -- Pakistan said Saturday that China would help build two more nuclear power plants in the energy-starved Muslim nation, tightening the bonds between the two countries as rising militant violence in Pakistan strains its anti-terrorism alliance with the United States.

The nuclear agreement was among a dozen economic cooperation accords signed last week during President Asif Ali Zardari's visit to Beijing, Foreign Minister Shah Mehmood Qureshi said.

Although Qureshi gave few details, enhanced cooperation with China probably will help ease Pakistan's resentment of a recent deal allowing U.S. businesses to sell nuclear fuel, technology and reactors to India.

For more on this article, please click on the following link: Pakistan gets power plant deal: LA Times

Pakistan to get refurbished warship from US: PTI

Islamabad, Oct 19 (PTI) Pakistan will receive a refurbished warship from the United States for being a "major non-NATO ally", a special status which allows it to receive surplus defence equipment from the American armed forces.

President George W Bush signed an order on Friday enabling Pakistan to receive the multi-purpose frigate USS McInerney. The US Congress had approved the transfer on September 27.

Since the warship is 32-years-old, Pakistan has asked for it to be refurbished at a cost of USD 65 million. The overhaul will include the fitting of an anti-submarine missile system, modern guns and other weapons.

Though equipment received from the US under the excess defence article (EDA) arrangement are free, Pakistan will have to bear the expenses for the refurbishing. The Pakistan Navy is expected to receive the frigate in August 2010.

The US recently completed the delivery of 14 refurbished F-16 jets to Pakistan under the EDA arrangement.

For more on this article, please click on the following link: Pakistan to get refurbished warship from US: PTI

Friday, October 17, 2008

16 Malaysian Companies For Expo Pakistan 2008: Bernama

KUALA LUMPUR, Oct 15 (Bernama) -- Malaysia will be represented by 16 companies at Expo Pakistan 2008 which will be held in Karachi from Oct 27 to 30.

Pakistan's High Commissioner to Malaysia, Lt General (Rtd) Tahir Mahmud Qazi, said the presence of the Malaysian companies reflected the confidence of Malaysian businessmen in Pakistan's business-friendly environment.

Expo Pakistan is an event promoting products and services.

In a statement released by the Pakistan High Commission, Qazi said the expo aimed to provide opportunities for its participants to display quality and value-added products to a wide range of buyers.

For more on this article, please click on the following link: 16 Malaysian Companies For Expo Pakistan 2008: Bernama

Thursday, October 16, 2008

Pak, China to jointly establish National Electronics Complex: The News

BEIJING: Pakistan and China on Wednesday signed a framework agreement to jointly establish National Electronics Complex of Pakistan (NECOP). The total amount of the contract, which was signed by Pakistan Ambassador to China Masood Khan and President of CETC Yan Lijin, is estimated at around US $ 300 million, covering civilian, information technology and defense electronic domains in Pakistan. Through the establishment of NECOP, CETC will help Pakistan achieve indigenous research and development and production capabilities after providing sophisticated training and technical assistance packages by fully utilizing local resources.

For more on this article, please click on the following link: Pak, China to jointly establish National Electronics Complex: The News

Dubai-based group to generate 5,000 job opportunities: Daily Times

Staff Report

ISLAMABAD: A delegation of MAF Hypermarkets Pakistan (Pvt) Ltd on Wednesday apprised Saleem H Mandviwalla, Chief of Board of Investment (BoI) regarding their investment plans to reduce inflation in the country.MAF Hypermarkets Pakistan (Pvt) Ltd, a company of MAF Hypermarkets LLC Dubai was led by Daniel Penco, Country Head and accompanied by Mubashir JALILI Vice President Development Pakistan and Shaukat Bhatti, GM Finance.The delegation informed that MAF Hypermarkets LLC, Dubai is in the process to generate 5,000 direct employment opportunities through ever first retail chain of 10 stores– Hypermarkets within next 5 years in Pakistan, 500 job opportunities for each Store (5,000 jobs for 10 stores) to reduce inflation. MAF Hypermarkets would help to reduce inflation by discount price policy, which puts pressure on retail prices and supports economic growth, contributes to modernise the manufacturing industry and transfer of retail knowledge. MAF Hypermarket is committed to create and promote export opportunities for international stores from Pakistan.

For more on this article, please click on the following link: Dubai-based group to generate 5,000 job opportunities: Daily Times

Wednesday, October 15, 2008

Dubai's Abraaj Capital buys into Karachi power firm: Reuters

By John Irish and Sahar Ahmed
DUBAI/KARACHI, Oct 15 (Reuters) - Private equity firm Abraaj Capital has bought a controlling stake in KES Power, the parent company of Karachi Electric Supply Co (KESC.KA: Quote, Profile, Research, Stock Buzz) (KESC), to boost generating capacity in Pakistan's largest city.
Dubai-based Abraaj, which manages about $5 billion in funds, said in a statement on Wednesday it was buying new shares in KES Power Ltd, giving Abraaj a 50-percent stake and management control of the firm.
Karachi is Pakistan's biggest city with a population of more than 13 million and is home to many industries, the country's two main ports and its main stock market.

For more on this article, please click on the following link: Dubai's Abraaj Capital buys into Karachi power firm: Reuters

Pakistan better than India in global hunger index: Daily Times

* IFPRI says low educational status of women, poor nutrition and health programmes, major problems in South Asia

NEW DELHI: Pakistan figures slightly better than India in a new global hunger index released by the International Food Policy Research Institute (IFPRI) in association with a German group Welthungerhilfe and Concern Worldwide.While India ranks 66 out of the 88 countries on the 2008 Global Hunger Index, Pakistan stands at number 61. Bangladesh made the list at number 70. According to the authors of the report, three leading indicators - prevalence of child malnutrition, rate of child mortality, and the proportion of people who are calorie deficient – were the standards upon which the countries were rated."The world has made only slow progress in reducing hunger in past decades, with dramatic differences among countries and regions," said Ashok Gulathi, the IFPRI Asia director.He said though current financial measures might bring some short-term relief for hungry people, as they will reduce commodity prices, but the credit crunch will make access to capital difficult, including for agriculture, and that could add another obstacle to overcoming the food crisis.

For more on this article, please click on the following link: Pakistan better than India in global hunger index: Daily Times

KSE to remove ‘floor’ on 27th: Dawn

By Dilawar Hussain
KARACHI, Oct 14: The Board of directors of the Karachi Stock Exchange (KSE) decided on Tuesday to remove the ‘floor’ from under the KSE-100 index on Oct 27.“Normal trading parameters of 5 per cent upper and lower circuit breakers will be imposed from that day onwards,” a spokesman for the bourse said.The KSE had fixed a ‘floor’ under the index at the 9,144 points level on Aug 27 to prevent a further fall, after a fearful plunge in equity values by 41 per cent in less than four months. The measure had brought the market to a virtual halt with volume of shares traded at 11-year low on Tuesday, at just over half a million shares.The Chairman of the Securities and Exchange Commission of Pakistan (SECP), Raziur Rehman, told Dawn that the ‘floor mechanism’ had been put in place to give the market a ‘breathing space’. He expressed the hope that as the world equity markets were heading towards stability, the KSE would be able to absorb the shock, if any, from soft landing.Incidentally, the announcement of ‘floor’ removal coincided with the arrival of Prime Minister’s Adviser on Finance Shaukat Tareen, who had expressed his disapproval of the ‘floor’ and turned down a request for closure of the market.Analysts were worried over a possible 20 per cent drop in the index in the first week after the planks are pulled from under the ‘floor’. The big scare was the foreigners’ selling, who still held $2 billion in equities.The KSE spokesman said the board had discussed with the finance ministry, SECP, SBP and other stakeholders three critical areas of liquidity; risk management and restoring investor confidence. It said the ministry and the SECP would “implement full set of stabilisation measures prior to Oct 27”.

For more on this article, please click on the following link: KSE to remove ‘floor’ on 27th: Dawn

Pakistan’s first wind mill near completion: The News

By By Saad Hasan 10/15/2008
KARACHI: A Turkish company is close to completing the first windmill in Pakistan, which is suffering from severe energy shortage and a ballooning current account deficit as it continues to spend billions of dollars on import of fuel oil to run thermal power plants.

Zorlu Enerji Pakistan has almost completed foundation work for five wind turbines in Jhimpir, 70km from Karachi, each capable of producing 1.2 megawatts of electricity. Though initially 6MW of electricity will be produced, the project will be expanded to 50MW in the next few years.

“We are looking forward to erecting the structures by the end of November,” said Osman Ipek, CEO Zorlu while talking to newsmen on Monday. “The potential is immense, wind density and speed is sufficient.”

It has been quite some time since a natural wind corridor from Gharo to Keti Bandar in Sindh province was discovered. This windmill will mark the first of many such projects in the pipeline. Alternative Energy Development Board (AEDB), a government body tasked with promoting indigenous sources of renewable energy, has successfully formulated a policy which ensures better return for investors.

Project Manager Yagmar Ozdemir said sale price of wind energy in Pakistan is better than other countries. “Internal rate of return of 15 per cent (annually) is very good. Other countries do not offer more than 12 per cent.”

For more on this article, please click on the following link: Pakistan’s first wind mill near completion: The News

Monday, October 13, 2008

Pakistan, Malaysia to construct 305 MW power project in Karachi: APP

SLAMABAD, Oct 13 (APP): Progas Pakistan and KUB Malaysia Berhad have won the bid to construct 305 MW Independent Power Project at Port Qasim, Karachi.

Present government had invited investors to establish power projects in Pakistan on a fast track basis, consisting of two packages - Package-A for IPP projects of 1000 MW and Package-B for Rental Power Projects.

According to Private Power and Infrastructure Board (PPIB) here Monday, out of the twelve (12) bids received, three bids of Progas Energy, Cavalier Energy and Ruba Energy Pakistan were approved for construction of three Independent Power Projects with total power generating capacity of 929.06 Megawatt and two bids of Karkey, Karadeniz Eledkrik Uretim A.S and Walters Power International were approved for renting of two power generators of 418.802 MW capacity.

For more on this article, please click on the following link: Pakistan, Malaysia to construct 305 MW power project in Karachi: APP

Friday, October 10, 2008

Chinese firm to construct 1,100MW power project: The News

Friday, October 10, 2008By our correspondent

ISLAMABAD: In a positive development, Sinohydro Corporation of China is to invest in 1,100MW Kohala hydropower project.Top officials of the company came up with the offer on Thursday in a meeting with the Federal Minister for Water and Power, Raja Pervez Ashraf. The minister said that government would facilitate foreign investors to invest in the water and power sector in Pakistan as there are great opportunities. He said that foreign investment in hydel power generation would help to meet the country’s future power requirements at affordable prices.Ashraf also informed the delegation that Pakistan was embarking on the construction of multipurpose dams which would meet power needs in the long term. Earlier, the Chinese company gave a detailed presentation to the minister on its ongoing projects and briefed him on the expertise in construction of hydropower projects. The firm expressed interest in investing millions of dollars in Pakistan by constructing 1,100MW Kohala hydropower project.They also informed that the company is working on 156 hydropower projects in various countries of the world. The company is already constructing Gomal Zam dam, Khan Khawar hydropower project and Dubair Khawar hydropower project in Pakistan.

For more on this article, please click on the following link: Chinese firm to construct 1,100MW power project: The News

Pakistan's Market Policy: Economistan.com

FREE MARKETS:Pakistani economy along with the Pakistani rupee would be better served if the floor on KSE remainson for another month or so.

NO TO FLOOR REMOVAL FROM KSE
By Saad Sarwar Muhammad
Friday, October 10, 2008

Pakistan’s main index, the Karachi Stock Market (KSE) has witnessed a dramatic fall in market capitalization during the year 2008; falling from ahigh of approx 16,000 points in April in a steep fall to 9,000 points in a span of a few months. Resultantly, the Karachi Stock Market (KSE) put a floor of 9000 points on the index to arrest the unrelenting flight of capital. The market capitalization of the KSE has decreased by about $36 billion dollars during the last year. Around the same time the total liquid foreign exchange reserves have fallen from an all time high of $16.5 billion to $8.4 billion. This dollar flight has resulted in gradual erosion in the value of rupee, which has fallen from 60.74 to a dollar in October 2007 to around 80 to a dollar in October 2008 within a span of one year.
Statistically speaking, it was found after calculation that capital movement away from the stock market had a strong correlation with the depreciation of the rupee and it was found to be around 0.6057, while capital flight from the total liquid foreign exchange reserves was found to have a very weak positive correlation of 0.0525 with the depreciation of the rupee.

Foreign investors have repeatedly asked for the KSE index to be traded free from the floor imposed at 9000 points. If such a demand is met anytime soon and the market capitalization goes down by $15 billion, it would result in the further devaluation of the rupee from its current parity of 80 to a dollar to 90 to a dollar or beyond according to our extrapolation of data.

For more on this article, please click on the following link: Pakistan's Market Policy: Economistan.com

Thursday, October 9, 2008

Banks import dollar bills to meet panic withdrawals: Business Recorder

KARACHI (October 10 2008): Banks have imported a big consignment of cash US dollars in order to meet a sudden surge in panic withdrawals, according to well-placed banking and government sources. Unlike prior to 1998, banks now do not surrender their forex deposits to the State Bank of Pakistan and instead keep these funds abroad with corresponding banks or their head offices in case of foreign bank branches.

The question of freezing these deposits, therefore, does not arise. Bankers expect their clients' nervousness to end in the next couple of days as they can safely meet the clients needs. Meanwhile, the Pak rupee-dollar parity on the interbank market was stable with parity moving in a short band of Rs 79 to 79.30 per US dollar.

The end of the day rate was Rs 79.10/20 and for tomorrow value Rs 79.22/23 to a dollar. The downgrading of Pakistan risk resulted in a dip of Pak Euro bond trading. The February 2009 Sukuk was at 94 cents offer with no bids. 2016 maturing bonds at 43 cents, 2017 maturing papers 39/39 cents and 30-year bond maturing in 2036 was being offered at 33 cents.

For more on this article, please click on the following link: Banks import dollar bills to meet panic withdrawals: Business Recorder

Wednesday, October 8, 2008

Pakistan Central Bank to Cut Cash Reserve to Improve Liquidity: Bloomberg

By Khalid Qayum

Oct. 9 (Bloomberg) -- State Bank of Pakistan, the nation's central bank, said it will cut the cash reserve requirement for banks by two percentage points to improve liquidity in the financial markets.
The central bank will slash the cash reserve, or the proportion of deposits banks must set aside as cash, for all deposits up to one year by one percentage point to 8 percent from Oct. 11, according to a statement late yesterday by Karachi-based State Bank. The measure will be cut by another percentage point on Nov. 11, it said.
The step will release 61 billion rupees ($766 million) into the financial markets, the statement said, citing Governor Shamshad Akhtar.

"This is a temporary measure aimed at accommodating extraordinary liquidity requirements of the banking system,'' Akthar was cited in the statement as saying.

For more on the article, please click on the following link: Pakistan Central Bank to Cut Cash Reserve to Improve Liquidity: Bloomberg

Pakistan, China may enter deals for more nuclear power plants: Tehran Times

Pakistan will seek help from China in installing two more nuclear power plants at Chashma, materialising the Diamer-Bhasha Dam project, and joint ventures in manufacturing and assembling cars during the visit of President Asif Ali Zaradri to Beijing that is to start from October 14.

According to a senior government official at Finance Ministry, Pakistan and China may also strike deal in manufacturing and assembling of trucks. “This is basically the proposal of Heavy Mechanical Complex.” Islamabad and Beijing may also enter into agreements for setting up steel mills and cement plants and for developing the agriculture industry. China would be invited to invest in pesticide production and hybrid seed industry. During the visit, Pakistan would also seek cooperation in developing the electronics industry and home appliances.

For more on this article, please click on the following link: Pakistan, China may enter deals for more nuclear power plants: Tehran Times

SBP injects $100 million in market: The News

Updated at: 1215 PST, Wednesday, October 08, 2008

KARACHI: The State Bank of Pakistan has injected US$100 millions in market today (Wednesday).

For more on this article, please click on the following link: SBP injects $100 million in market: The News

Tuesday, October 7, 2008

KSE-100 index recomposed: Daily Times

KARACHI: The Karachi Stock Exchange (KSE) has recomposed its benchmark 100 index, effective from October 06, 2008.

As per the recomposition rules, seven news companies have been included in the KSE-100 index. These companies are Askari Leasing, Nskshbandi Industries, Colony Sugar Mills, Arif Habib Bank, JS Bank, Altern Energy and Hinopak Motors Limited.

For more on this article, please click on the following link: KSE-100 index recomposed: Daily Times

Sunday, October 5, 2008

UAE's imports from Pakistan rise 50% to $1.8b: Gulfnews

By Nadia Saleem
Staff ReporterPublished: October 03, 2008, 23:41

Dubai: The UAE's imports from Pakistan increased 50 per cent this year compared with the previous year, according to trade figures from the Pakistani Commercial Office in Dubai.
Imports increased from $1.2 billion in 2007 to $1.8 billion in 2008. The UAE was the largest importer from Pakistan in the Arab region.
The Arab region imported goods worth $3.36 billion in the July 2007-May 2008 period, an increase of 40.4 per cent from the year before.

For more on this article, please click on the following link: UAE's imports from Pakistan rise 50% to $1.8b: Gulfnews

Marriott Hotel Islamabad opened in Pakistan: Pakistan Daily

Reconstruction work is gaining momentum at Marriott Hotel following gruesome blast on 20th of last month.
Reliable Sources of Marriott Hotel informed that it has been temporary re-opened while in the initial stages The Patisserie, Outdoor Catering Laundry Sops and Pearl Tours are now ready to serve its respected customers.

For more on this article, please click on the following link: Marriott Hotel Islamabad opened in Pakistan: Pakistan Daily