Pakistan's economy and monetary policy: Reuters

By Faisal Aziz

Reuters - Pakistan's central bank is scheduled to announce its monetary policy for October-November on Tuesday. Here are some facts about the State Bank of Pakistan's monetary policy and the economy.

* In the previous policy review on Aug. 15, the central bank cut its key policy rate by 100 basis points to 13 percent -- the second rate cut since January.

* As part of an understanding with the International Monetary Fund, the central bank also announced in August an interest rate corridor, with the policy rate serving as the "ceiling" and the "floor" set 300 basis points below that.

* The frequency of monetary policy reviews was also increased to six a year from four, which was also part of the IMF deal.

* Pakistan is being propped up with a $7.6 billion IMF loan running for two years that was agreed in November. The IMF increased the loan by $3.2 billion in July.

* GDP growth slid to 2 percent in 2008/09, about the same as population growth. The government expects growth of 3.3 percent in the fiscal year to the end of June 2010. The Asian Development Bank expects growth of 2 percent in 2009, rising to 3 percent in 2010.

* Steady improvements in key economic indicators have encouraged the central bank to cut rates and provide impetus for growth, but concern about the fiscal side and risks of growing price pressures have prevented a big expansionary policy.

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Pakistan yet to exploit alternative energy resources: The News

By Mansoor Ahmad
LAHORE: Despite an acute energy shortage and worsening environmental pollution, Pakistan has not exploited the vast potential of environment-friendly alternative energy resources which could add billions of dollars to the economy in the form of carbon credit.

Besides developed countries, many developing economies are adopting alternative methods to produce energy from sources other than fossil fuel. Pakistan, on the other hand, has almost doubled its fossil fuel consumption in order to generate electricity.

Pakistan having a breezy and long coastline has the potential to churn out over 50,000 megawatts of electricity from wind, but at present it hardly produces 100 megawatts.

India and China are among top 10 producers of wind energy. Total installed wind power capacity of China is 12,210MW, of which 6,300MW was added in 2008. In India, total installed wind energy capacity is 9,645MW, of which 1,800MW was added in 2008.

Pakistan’s solar energy potential is also unlimited but no credible progress has been made except for importing some solar-powered geysers from China, which enjoys 66 per cent of global solar water heating capacity. It is followed by Turkey with a 5.8 per cent share. India is also among top 10 countries in solar water heating system with a global share of 1.2 per cent. Pakistan’s share in this area is zero.

Ethanol production in the world increased by 34 per cent in 2008 to 67 billion litres, in which Brazil’s share was 27 billion litres, which make up more than 50 per cent of its non-diesel fuel consumption.

The US was the top ethanol producer with 34 billion litres. India has made it mandatory to add 20 per cent ethanol to motor gasoline. In Pakistan, the first petrol pump started selling ethanol-blended fuel in Islamabad five years ago. However, only a few fuel stations have been added during this period at an average of one outlet per year.

The World Bank’s solar home system projects in Bangladesh and Sri Lanka remained continued, with cumulative installations in 260,000 households by 2008 in Bangladesh and 125,000 households in Sri Lanka. There are not more than 500 residences in Pakistan which have this facility.

The world has made progress in generating energy from waste which Pakistan currently dumps in low-lying areas, polluting the environment. Electricity is being produced through biomass around the world. Though most sugar mills in Pakistan produce electricity from biomass, the government is reluctant to buy this cheap power. The Alternative Energy Development Board has so far signed agreements to buy this electricity with only two out of 73 sugar mills.

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Pakistan Petroleum to Increase Output From Manzalai, CEO Says: Bloomberg

By Farhan Sharif

Sept. 29 (Bloomberg) -- Pakistan Petroleum Ltd., the nation’s biggest gas producer, plans to increase output from the Manzalai area of the Tal block this year, after missing earlier targets.

“Because of certain delays, production facilities will be in place by November and we hope to increase output to 250 million cubic feet a day,” Chief Executive Officer Khalid Rahman said in an interview in Karachi today.

Pakistan Petroleum needs to compensate for a decline in production from the biggest Sui field in the southwestern province of Baluchistan. Production from Sui, which began in 1955, is declining by as much as five percent a year, according to the company.

The company had planned to increase production from the North West Frontier Province based-Manzalai, which has reserves of 1.3 trillion feet, to 250 million cubic feet a day by June, from 39 million cubic feet, Rehman said in an interview in February.

For more on this article, please click on the following link: Pakistan Petroleum to Increase Output From Manzalai, CEO Says: Bloomberg

Australia, Italy pledge more aid to Pakistan: Dawn

ISLAMABAD: Australia will provide more development aid to Pakistan while Italy has promised a 20-million-euro soft-term loan for training in the marble sector in the NWFP and Balochistan.

The increase in Australian aid and military cooperation was announced by Australian Prime Minister Kevin Rudd and Foreign Minister Stephen Smith after the Friends of Democratic Pakistan summit in New York.

According to a statement issued by the Australian High Commission on Monday, the aid package included doubling of military training slots for Pakistan Army to 140 and establishing defence post-graduate scholarships, making Australia the second largest provider of overseas military training to Pakistan after the United States.

It also included expanding strategic dialogue, establishing an Australia-Pakistan development partnership focusing on health reforms, reconstruction of the Malakand region, promoting democratic governance and economic reforms and providing 100 agricultural scholarships.

Over the past couple of years Australia has increased defence and law-enforcement assistance, doubling development aid to $120 million for two years and contributing $23 million in humanitarian support since last year.

For more on this article, please click on the following link: Australia, Italy pledge more aid to Pakistan: Dawn

Seafood exports rise despite EU ban: The News

By Shahid Shah

KARACHI: Pakistan’s seafood exports increased in August compared to the same period last year after measures taken to improve the condition of harbour and that of boats used in catching fish and shrimp.

According to data, seafood exports rose to 5,327 tons in August against 5,032 tons in August last year. Value of exports also increased to $9.653 million from $9.104 million.

Director General Marine Fisheries Department and Chief Executive Officer Fisheries Development Board, Mohammad Moazzam Khan, told The News several steps had been taken for making improvements at the harbour and modifying boats, which led to increase in seafood exports.

Sources said the exports rose after efforts made by the government which was serious about livestock and dairy development and get the EU ban on seafood exports lifted.

A European Union delegation is likely to visit Pakistan in October to inspect the Karachi Fisheries Harbour.

The EU de-listed all Pakistani seafood exporters in April 2007 and the ban has not yet been lifted. Out of 28 seafood processing units, 11 had been exporting to the EU.

When an EU mission visited the harbour in 2007, it found deficiencies both at the harbour and processing units. Expressing concern, the EU’s Directorate of Food and Veterinary submitted its 25-page findings to Pakistani authorities.

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Saudi Arabia gives $100mln aid to Pakistan: Reuters

By Corinne Scotland

LONDON (AlertNet) - Saudi Arabia has pledged $100 million to Pakistan to help about 2.7 million people who fled their homes during fighting between government forces and the Taliban, the United Nations has said. So far Pakistan has received about $374 million in aid from more than 20 countries, private individuals and organisations. "This contribution from the Kingdom of Saudi Arabia is the single largest contribution received for the vulnerable populations of Pakistan," said Martin Mogwanja, Humanitarian Coordinator for Pakistan.

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Hinopak to export buses from Pakistan to ME and Africa: Daily Times

KARACHI: Hinopak is Pakistan's first automobile company to export its buses to Middle East and African countries in early 1990's and once again Hinopak would take a gigantic leap in the international market by starting export of buses to Middle East and Africa, a statement released on Friday said. In the statement Mohammad Irfan Shaikh, Director Sales and Marketing, Hinopak stated that it is proud to mention that Hinopak has been chosen as a hub by its principal Hino Motors, Ltd., Japan for manufacturing Hino buses for export to Middle East and Africa. In this regard the first meeting with Hino distributors from Middleast and Africa was held in November last year, where Hino distributors showed their keen interest in Hino buses because of their quality which is not less than any international bus.

Irfan also congratulated the CDGK to start the pilot project by inducting CNG buses in the Karachi transport system. He further added that it is one such step which would augurs well for the citizens of Karachi and would provide impetus for the future induction of both new CNG and Diesel buses in Karachi and also in other cities of Pakistan especially in Punjab. He mentioned that, in Punjab more than 1500 urban buses are successfully operating on the roads and facilitating the commuters. He also urged the government of Punjab to start the operation of locally produced CNG buses which would definitely modernize the existing urban transport system.

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Pakistan's forex reserves rise to $14.48 bln: Forbes

KARACHI, Sept 24 (Reuters) - Pakistan's foreign exchange reserves rose to $14.48 billion in the week that ended on Sept. 19 compared with $14.36 billion the previous week, the central bank said on Thursday.
Reserves held by the State Bank of Pakistan rose to $10.94 billion from $10.84 billion a week earlier, while those held by commercial banks also edged up to $3.54 billion from $3.52 billion a week earlier, the central bank said in a statement.
For more on this article, please click on the following link: Pakistan's forex reserves rise to $14.48 bln: Forbes

Pakistan Chief of Army Staff in list of "50 People Who Matter Today": Sify

Pakistan Chief of Army Staff (COAS) Ashfaq Kayani has been ranked higher than Pope Benedict XVI and UK Prime Minister Gordon Brown in a list published by a British political magazine, which highlights 50 individuals who have been instrumental in having an impact in today's scenario around the world.
New Statesman's list of "50 People Who Matter Today", has the Obamas as the most influential people in the world, while Kayani has been ranked at 24th position, way ahead of the Pope or Brown, The Daily Times reports.

For more on this article, please click on the following link: Pakistan Chief of Army Staff in list of "50 People Who Matter Today": Sify

Blackwater: Widening the rift: Dawn Blog

Conspiracy theories have always had high currency in our part of the world and ritual cynicism towards America is quite usual. Recent reports claiming the presence of CIA’s contractual army – Blackwater – in Pakistan have bolstered concerns within the Pakistani public about US involvement in this country’s affairs. It’s high time, though, that the government came clean with the public about the extent of US involvement in this country’s security affairs.
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Blackwater is a private mercenary company which is known to have worked with the CIA on various occasions, including the Iraq war. Rumours claiming that Pakistan is its new home have triggered quite a lot of commotion. It all begin with reports claiming that Blackwater (now known as Xe) had been operating in Pakistan as a vital tool for America’s counterterrorism program.

Jeremy Scahill, the author of Blackwater: The Rise of the World’s Most Powerful Mercenary Army, recently wrote an elaborate piece on the possible involvement of Blackwater inside Pakistan. Scahill talks about the notorious history of the organisation and goes on to suggest that it has been playing a vital role in Afghanistan and Pakistan since 2002, acting as a key player in arming drone aircrafts.

Scahill also quotes former employees who claim that Blackwater’s owner, Prince Erik, ‘views himself as a Christian crusader tasked with eliminating Muslims and the Islamic faith from the globe.’ The allegations quite literally portray Blackwater as a Christian Al Qaeda. Not surprisingly, the presence of such a force in Pakistan is disturbingly provocative.

The speculations relate back to last September, when the Marriott Hotel blast occurred in Islamabad. Various reports suggested that an undercover operation by US marines was being planned when the attack happened. However, such allegations have been repeatedly denied.

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Pakistan government keen on medical tourism: IMTJ

A sudden government interest in health tourism to prop up a national tourism industry with problems is an increasingly familiar refrain. The latest in this growing list of countries with little existing inbound medical tourism is Pakistan.

More than 2,000 people have been killed in Taliban-linked attacks across Pakistan in the last two years, scaring away all but the most intrepid foreign tourists. Pakistan earned $200 million from 800,000 visitors in 2007. Fewer than 400,000 visitors came in 2008, and the numbers are expected to be even lower this year.” Terrorism has really affected us a great deal,” admits Tourism Minister Ataur Rehman.The Pakistan government hopes that medical tourists can help revive the country’s troubled tourism industry in a big way, which is why the main focus of their new tourism policy will be on health tourism.

Rehman says that his ministry is in consultation with the provincial tourism departments, travel agencies, airlines, businessmen, and other stakeholders on the new policy of providing foreigners with quality healthcare at a price far less than what they pay in Western countries, “The introduction of health tourism will not only bring in foreign tourists but will also help develop health infrastructure on modern lines, create job opportunities, generate greater revenues and most importantly, cast off the country’s negative image of being an unsafe destination.”

He argues that the country has internationally acclaimed doctors and world-class medical facilities, with Pakistani hospitals and doctors being at par with their Western counterparts in specialising in the fields of heart surgery, eye care, cancer therapy, dentistry and diagnostics, at a fifteenth of the cost overseas.

Rehman says a new plan to revive the tourism industry is essential as there has not been a fully new one for two decades. The aim is engage the private sector in developing the tourism infrastructure to attract locals and foreigners.

The minister criticises international newspapers and TV channels, for inflicting considerable damage on the country’s tourism industry and substantially reducing numbers, by generalising a bad law and order situation

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US sold $4.5 bn worth arms to Pakistan in three years: Report: Hindustan Times

The United States sold arms worth $4.5 billion to Pakistan between 2005 and 2008, says a Congressional report even as Washington has expressed concern about reported diversion of military equipment away from the war on terrorism to fight India.

An updated Congressional report released last month says Washington signed arms transfer agreements with Pakistan in excess of $3.5 billion in the year 2006 alone, "ranking Pakistan first among all arms clients of the United States during that calendar year".

Last week, former Pakistan president Pervez Musharraf confessed that bulk of US military aid to Pakistan had been diverted for fighting India. However, he later backed out as Washington expressed concern.

For more on this article, please click on the following link: US sold $4.5 bn worth arms to Pakistan in three years: Report: Hindustan Times