Friday, 23 November, 2012

ECC meeting: Wheat support price

and sugar export allowance increased

g Weekly POL price adjustment abandoned

g Balochistan gets subsidy on tube wells

IslAmAbAd

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Economic Coordination Committee (ECC) of the cabinet met on Thursday followingwhich the support price of wheat for the next crop was increased to Rs 1200 per 40 kilo-grammes against last year’s price of Rs 1050.Under the chairmanship of Federal Minister for Finance and Economic Affairs DrAbdul Hafeez Sheikh, the members were informed that international prices of wheatwere much higher which resulted in smuggling to neighbouring countries. It wasbrought to the committee’s notice that prices of inputs had risen during the last yearand therefore to facilitate and encourage wheat growers it was essential to increase thesupport price. The ECC also approved the commerce ministry’s recommendation for re-duction in the age limit of importing used cars from five to three years. The ECC de-cided that the decision will be effective from December 15, 2012 in order to facilitate thein process orders. The measure will provide relief to the local auto vendors industrywhich was deteriorating due to the import of used cars.The ECC allowed export of a total of 400,000 Mega Tonnes (MT) of sugar, an increaseof 64,166 MT over its previous decision. The committee was informed that there was ahuge surplus of sugar in the country and a bumper crop of sugarcane was expected thisyear. The measure has been approved in order to improve the liquidity position of sugarmills so that sugarcane growers are paid on time at the rate fixed by the government.The ECC further restored the agricultural tube wells subsidy in Balochistan. Under theapproved procedure the tube well owners would pay Rs 6,000 per month. The federalgovernment would pay 40 percent, and the Balochistan government 60 percent of theremaining amount. For bills over Rs 50,000, the excess would be paid by the tube wellowner. The number of tube wells would remain static at 15,660. The decision will be ef-fective from December 1, 2012. The shares assigned in the above arrangement will bereviewed after two years to lessen the burden on the federal government and transfer it

onto the Balochistan government corresponding tothe provincial share it receives from the divisible

pool. Additionally, existing tube wells are to bereplaced by solar tube wells.

In line with the National Assembly’s resolu-tion to discontinue the weekly price ad-

justment system of petroleum products,the ECC decided to abandon the pre-vailing weekly pricing system. How-ever, a committee comprising of

ministers for law and justice, petro-leum and science and technology wasformed to consider and suggest a prag-matic mechanism for POL pricing thatwill be considered in the next ECC meet-

ing. The ECC also considered the sum-mary of ministry of port and shipping to

strengthen the Pakistan National ShippingCorporation (PNSC) and to make it a vibrant

national carrier. The committee decided to re-enforce the recommendations of the Kazi Com-

mittee with full force which included all publicsector cargoes to be carried by PNSC and all

government departments, autonomous and semi-autonomous organisations to utilise the services of

PNSC for carrying their cargoes. PNSC is to act as theshipping agency for all ministries, autonomous and semi-

autonomous departments of the government. Organisationslike PSO, TCP and PSM should have long term contracts of ship-

ping on a market based formula as was being donesuccessfully with refineries.

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INDONESIAN Minister forTrade Gita Wirjawan on Thurs-day said that the PreferentialTrade Agreement (PTA) signedwith Pakistan earlier this year

would become operational in 15 days.He said the implementation of PTA

signed on February 4, 2012 will not onlyimprove relations between the twocountries but also provide a level play-ing field to all exporters of edible oilwho have vested interests in a lucrativePakistani market.

Wirjawan stated this while talkingto a select group of edible oil importersled by Pakistan Vanaspati Manufactur-ers Association (PVMA) Senior VicePresident Atif Ikram Sheikh who is alsoIslamabad FPCCI Capital Office Coordi-nation Chairman.

Akbar Iqbal Puri, Malik Sohail,Leonard F Hutabarat, Asia Pacific andAfrican Affairs Director GeneralMuhammad Hartantyo, Indonesianministry of foreign affairs representa-

tives and others were also present in themeeting arranged by the Indonesianembassy.

Wirjawan gave assurances that In-donesia will provide every possible fa-cility to Pakistani importers. Sheikhand Puri, on the occasion said the im-position of PTA will provide incentivesthat will boost Indonesian exports intoPakistan.

Initially, Pakistan will save 35 USDper ton on import of palm oil from In-donesia which will help the countrysave a total of 70 million dollars of pre-cious foreign exchange per annum.Sheikh further said Indonesia importswill not only help importers save moneybut will assist manufacturers in clip-ping prices which will benefit the com-mon man.

He also stated that PTA will helpPakistani exporters gain enhanced ac-cess to Indonesian markets on 216 tar-iff lines at the preferential rate. Thiswill be a great opportunity for Pak-istani businessmen dealing in freshfruits, cotton yarn, cotton fabrics,readymade garments, fans, sports

goods, leather goods and other indus-trial products, he said. He observedthat this crucial development will help

stakeholders anticipate future develop-ments in an increasingly challengingglobal economy and enable diversifica-

tion of exports, thereby increasingtheir resilience amidst the current eco-nomic meltdown.

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Argentine Ambassador to Pakistan andDean of Diplomatic Corps Rodolfo J Mar-tin Saravia, while addressing the businesscommunity at Islamabad Chamber ofCommerce & Industry (ICCI) said therewas a need for increasing economic, com-mercial and political activities betweenPakistan and Argentina to enhance bilat-eral trade relations between the businesscommunities of both countries.

He said his country had started jointventures with Pakistani pharmaceuticalcompanies to produce medicines for Can-cer and Hepatitis C treatment in Pak-istan. Saravia further said that Argentinais a leader in the use of CNG and Pakistanwas already importing CNG equipment

from Argentina, adding that agriculture,alternative energies, pharmaceutics andCNG buses for passengers could serve askey sectors for starting joint venture.

He said the bilateral trade volume be-tween the two countries stood at $200million in 2008 which dipped to around$130 million in recent years which impliedthere was a dire need to find ways andmeans through which the trade volumecould be increased. He further stated thatPakistan had great potential in exportingfruits and vegetables in the internationalmarket, therefore, fruit processing plantsshould be developed on modern lines toavoid wastage of large quantities due tolack of proper packaging.

In his welcome address, PresidentICCI Zafar Bakhtawari lauded Saravia’sefforts in playing a dynamic role to

strengthen bilateral relations in allspheres between the two countries.Bakhtawari said both countries shouldconcentrate on existing opportunities andsuggested that cooperation could be en-hanced in agriculture, energy and phar-maceutical sectors. He stated that visitsof business delegations should also be en-couraged to explore markets. In this con-nection, he invited business delegationsfrom Argentina for meeting with theirPakistani counterparts.

Bakhtawari said Pakistan’s exports toArgentina did not make significant im-provements in recent years which meantthere was a need to undertake frequentactivities such as people to people con-tacts, organising country exhibitions,participation in fairs, seminars and work-shops to ensure a continuous liaison.

Argentine envoy stresses for enhanced Pak-Argentine trade relations

KARACHI

ISMAIL DILAWAR

Iran Thursday said progress on the megaproject of Iran-Pakistan (IP) pipelineproject was slow and being affected by in-ternational pressure and other factors.

Further, Tehran expressed a strongdesire for establishing banking channelswith the neighbouring Pakistan for whichIranian side had held several meetingswith last four governors of the State Bankof Pakistan.

Also, the Karachi Chamber of Com-merce and Industry (KCCI) called for thesetting up of Karachi-Tehran JointChamber of Commerce and Industry toexplore the huge trading potential be-tween the two bordering countries.

“The progress on mega project oncost sharing basis between the two coun-tries is slow,” Consul General of Iran inKarachi Abbas Ali Abdollahi told afarewell reception held here by KCCI inhonour of the outgoing consul general onthe completion of his 29 months assign-ment in the city.

Abbas said Iran had laid 1200 kilo-metres pipelines from Bander Abbas upto Balochistan border, but internationalpressure and other factors were affectingthe progress on the “peace pipeline”.

He said Iran being next door neigh-bour could give energy in 10 cents to Pak-istan. The consul general hoped thatinternational sanctions against his coun-try won’t affect historical relations be-tween the two brotherly Muslimcountries. “In future a lot of avenues ofmutual cooperation would open,” he saidadding Pak-Iran friendship would furtherstrengthen in future.

Abbas, however, said unlike politicalrelations bilateral trade ties between Pak-istan and Iran were not reflecting the ex-isting potentials due to the sanctions.

The consul general said he had heldseveral meetings with last four governorsof the SBP on the establishment of bank-ing channel between the two countries.

The Bank Milli of Iran could open itsbranches in Pakistan and in reciprocityNational Bank of Pakistan could do thesame in Iran, he said.

He viewed Pakistan’s banking chan-nels were established with various coun-tries worldwide thus with Iran should notbe neglected. He said top leadership andministers do have the will to cement tieswhereas progress on the implementationside was slow.

He asserted that initiatives were re-quired to formalize undocumented tradebetween the two countries.

About the regional blocks, the Iran-ian consul general said the ECO was notmuch vibrant as compared to RCD. Heopined that there should be no embargoon Pak-Iran trade as other countries ofthe world were doing trade with Iran. Hesaid Iran’s trade with other regionalcountries was higher as compared to Pak-istan. Pakistani rice, wheat, fruits, dryfruits, mangoes, textiles items, petro-chemical, livestock, meat, dairy had agreat demand in Iran. Talking to Abbas,President KCCI Muhammad HaroonAgar stressed the need for the establish-ment of Karachi-Tehran Joint Chamberof Commerce and Industry.

Agar urged the governments of Pak-istan and Iran to introduce bankingchannel and make arrangements for cur-rency swap to enhance bilateral trade. Hesaid the business transactions betweenIran and Pakistan were routed throughAsian Clearing Union which was moretime-consuming than a normal Letter ofCredit. While opening an LC through

Iran’s sister companies in Dubai alsoadds to cost, he said.

The KCCI chief also stressed the needfor taking measures such as economic in-tegration and reduction in transactioncosts, port-to-port activities and customsmechanism to expand the volume of bi-lateral trade. He urged to activate and de-velop regional trading block of ECOcountries, particularly between Pakistan,Iran and Turkey. He proposed that thetrade between Pakistan and Iran shouldbe permitted in local currencies insteadof dollars and the trade through railwaysand road be regularized.

Agar viewed that Pakistan being en-ergy-hungry country should seriouslyconsider implementation of Iran-Pak-istan Gas pipeline project which is burn-ing need for Pakistan to overcome theenergy crisis and for industrialization.

He also called for deepening of theexisting Preferential Trade Agreementwhich was signed in 2004 to be followedby a Free Trade Agreement. Upon agree-ment or on arrangements of barter tradeIran may export electricity and petro-leum products to Pakistan. He under-scored the need of regular exchange oftrade delegations and organizing of exhi-bitions to enhance bilateral trade. He em-phasized on the need of documentationof trade and formalize it throughBalochistan border from where presentlybarter trade was in practice.

Iran offers energy at 10 centsto Pakistan, says progress on IP gas pipeline slowg Embargoed Tehran wants banking ties with Pakistan g KCCI sees need

for Karachi-Tehran Joint Chamber of Commerce and Industry

PTA with Pakistan in 15 days: Indonesian minister

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Friday, 23 November, 2012

Major Gainers

COMPANY OPEN HIGH LOW CLOSE CHANGE TURNOVERIsland Textile 687.34 721.70 720.00 721.70 34.36 500Bhanero Tex.XD 226.00 237.30 237.30 237.30 11.30 1,600Millat Tractors Ltd. 558.84 578.00 559.00 569.80 10.96 38,000Siemens Pakistan 740.00 750.00 747.00 750.00 10.00 1,700Colgate Palmolive 1290.00 1301.00 1300.00 1300.00 10.00 400

Major LosersBata (Pak) XD 1380.00 1400.00 1311.50 1352.50 -27.50 900Indus DyeingXD 549.98 550.00 522.50 538.91 -11.07 1,200Sanofi-Aventis Pak 325.00 315.00 315.00 315.00 -10.00 100Murree BreweryXDXB 155.00 152.00 147.25 147.38 -7.62 1,200IGI Insurance 126.91 123.00 120.57 120.57 -6.34 83,500

Volume Leaders

K.E.S.C. 5.65 6.44 5.70 6.16 0.51 36,529,000Fauji Cement 6.77 6.88 6.63 6.70 -0.07 23,695,000Jah.Sidd. Co. 15.87 16.35 15.40 16.10 0.23 12,298,500Maple Leaf Cement 13.95 14.70 13.75 14.25 0.30 9,255,000Azgard Nine 8.26 8.49 8.01 8.28 0.02 9,093,500

Interbank RatesUS Dollar 95.9684UK Pound 152.7433Japanese Yen 1.1679Euro 122.6572

Dollar EastBUY SELL

US Dollar 96.91 94.59Euro 124.47 121.49Great Britain Pound 152.45 154.24Japanese Yen 1.1756 1.1469Canadian Dollar 95.64 97.26Hong Kong Dollar 12.21 12.43UAE Dirham 26.38 25.22Saudi Riyal 25.84 25.21Australian Dollar 98.61 101.22

Business

Mobilink Foundation provides

1000 school bags for children in

Lahore and Karachi

KARACHI: Mobilink distributed 1000 schoolbags to underprivileged students in the cities ofLahore and Karachi in line with continuing cele-brations of Universal Children’s Day. The initia-tive was taken under the umbrella of MobilinkFoundation to extend support to children who aredenied formal schooling opportunities due to fi-nancial reasons or social exclusion. MobilinkTorchbearers, comprising Mobilink’s employeevolunteers, took part in this initiative to hand overschool bags to students at DSRA Education Trustin Karachi and Green Land School in Lahore. In his message for the occasion, Omar Manzur,Head of Corporate Communications, Mobilinknoted, “The initiative is a testimony to MobilinkFoundation’s commitment to both the children ofPakistan as well as the environment we live in.”

Etihad Airways wins Airline of the Year honours

KARACHI: Etihad Airways, the national airline of

the United Arab Emirates, won Airline of the Yearat the sixth annual Aviation Business Awards, heldin Dubai. This is the second time Etihad Airwayshas picked up the award, beating three other Gulfcarriers. The airline last won in 2010. Etihad Air-ways was lauded for its success over the past 12months, including: new route launches, aircraft in-vestment, on-time punctuality, its customer loyaltyprogram, network of alliances and market innova-tion. Etihad Airways’ Chief Commercial Officer,Peter Baumgartner, said the airline was delightedto win the title. “For Etihad Airways being namedAirline of the Year is the icing on the cake in whathas been a record-breaking 12 months for us. It istestament to the strength and success of our globalstrategy, the professionalism and hard work of ourteam, and the inspirational travel experiences weoffer our guests.”

Pakistan facing challenges in

economic growth: DS Concept

KARACHI: Pakistan’s economy face dramaticchanges, business and local leaders are strugglingwith uncertainties and deepening conflicts. Thebusiness leaders conference focused on the leader-ship capabilities that are increasingly essential for

building enterprise in a world of intensifying con-flicts. DS-Concept team along with the top managementof various financial institutions participated in aninteractive and informative session throwing lighton major problems of financial sector, at a localhotel in Karachi. Former finance minister, Mr. Shaukat Tarin in hiskeynote discussed the economic challenges facingPakistan and proposed some solutions to stepahead in the year 2013 and the way forward. Chieflearning officer Ideas Consulting & Life time mas-ter trainer, Dr. Sunil Gupta from India tangled theconference member in an interactive activitytransforming the way of thinking to overcome theproblems in the best possible way.

Qatar Airways first

Boeing 787 commercial

service takes off to Dubai

KARACHI: Qatar Airways began commercialservices of its brand new Boeing 787 aircraft withDoha – Dubai becoming the Dreamliner’s debutroute. The state-of-the-art aircraft is being deployed onfour daily rotations between the two cities mark-ing a new era for Middle East aviation as QatarAirways is the Boeing 787 launch customer in theregion. Flight QR 106 took off from Doha InternationalAirport at 0800 hrs for the one hour journey toDubai. Qatar Airways’ newest addition to its fleetheralds the start of an exciting new era for trav-ellers worldwide with unparallel levels of comfortand luxury onboard Boeing’s next generation air-craft. Qatar Airways has orders for 60 Dreamliners. The

next four 787s are due to join the fleet by the endof December. Qatar Airways Chief Executive Offi-cer Akbar Al Baker said the maiden commercialroute marked yet another exciting achievement forthe award-winning airline.

PIA rejects media reports

KARACHI: The happenings to PIA flight PK 787of 18 November have been dramatized and sensa-tionalized by the media to extract mileage. This isto put them in the correct perspective. All airline pilots are trained to safely fly and landan airplane following an engine failure during thecritical phase of taking off. This proficiency ischecked on full flight simulators every six months. The left engine of PK 787 failed after takeoff whenclimbing through 1200 feet. It suffered an enginestall, likely due to an internal malfunction. Astalled engine behaves like a badly tuned back-fir-ing car engine. It produces loud bangs and sparkslike a back-firing car engine. A stalled jet enginesometimes can behave and run normally whenpower is reduced, as it did on this particular flight.The pilots reduced engine power, and the stallingstopped. They completed required procedures andlanded back at Karachi where a replacement air-plane was available. To summarize the facts: The engine was never onfire, as media reported, it simply stalled due to in-ternal reasons which will be investigated. The en-gine was not even shut down by the crew. Only itspower was reduced. The pilots landed the airplanewith both engines running, after completing theirprocedures. A review of the recorded flight data reveals nor-mal, legitimate handling of the airplane. All dataand investigation of the engine stall reasons willbe shared with the Civil Aviation Authority, as isrequired by the regulations.

CORPORATE CORNER

KARACHI

ISMAIL DILAWAR

ECONOMIC Coordination Commit-tee (ECC) in its Thursday’s meetingdecided to revise downward, the agelimit of imported used cars to threeyears which market observers

dubbed as a positive move for the local auto indus-try. The impact of the ECC decision was visible inthe equity market where the benchmark 100-shareindex closed bullish gaining 18 points. The analystsattributed this positive trend, partially, to the ECC’smove on auto industry that attracted investors’ in-terest in the scrips from automobile sector.

“ECC announcement on car imports restric-tion beyond three years-old invited interest in autosector,” said Ashen Mehanti, a senior equity ana-lyst and director at Arif Habib Securities.

Previously, the importers were allowed to im-port cars of up to five years of age that, the analystssaid, had adversely impacted the sales of local au-tomobile companies. The buyers, finding the 5-year old cars cheaper, were prioritising importingused cars from abroad instead of going for newones in the local market.

According to researchers at Topline Research,benefiting from the age relaxation, the importersduring fiscal year 2012 had imported around56,000 units compared to 20,000 units in the fis-

cal year 2011.“The imports were highly skewed toward five

years old cars for being cheaper of the alternatives,”said Zeeshan Afzal, a Topline analyst.

The analyst said the availability of a cheap sub-stitute and rising inventory levels in the market de-creased the local auto industry’s sales by 31 percentto 40,000 units during first four months of FY13.The corresponding period last year had seen thesale of 59,000 units, Afzal recalled.

This clearly indicates that the government hastried to appease the local auto assemblers at the ex-pense of consumers who, after Thursday’s decisionof ECC, would not be able to import cars that areolder but much cheaper than what the local indus-try was offering them.

However, apparently, applying a sales-centricapproach the market observers opine that the de-velopment would augur well for the local auto in-dustrialists. “The development bodes well for localautomobile industry,” said the analysts. They, how-ever, expect a lag reflection in terms of sales in thelocal market because of the availability of high in-ventory of used cars in the market. “The movewould also allow them to pass on the cost pres-sures,” said Afzal. According to Abdul Azeem, a re-search analyst at InvestCap Research, thegovernment’s restriction of the import of used carsof more than three-years of age was a positive signfor the local automobile sector.

NA body recommends removal of MD PSO

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A parliamentary panel on Thursday recommended removal of Pak-istan State Oil (PSO) Management Director (MD) Naeem Yahya Mirfor his dual nationality and ineligibility for the post. ConvenerJamshed Dasti said expressed concern over PSO MD holding dual na-tionality and running the business of the largest oil agency in thecountry. The committee demanded removal of Mir for he may takeany decision against the national interests of the country and later fleeabroad. Dasti asked additional secretary Abid Saeed to remove Mirfrom his position otherwise he would go to the Supreme Court toraise the issue. The committee was expressed annoyance at the newsof oil theft of over Rs 320 million from the system of OGDCL. In thisregard, OGDCL MD Masood Siddiqui informed the parliamentarypanel that two officials were involved in the act and those officers hadbeen suspended while a reference had been sent to National Account-ability Bureau (NAB) against them. OGDCL MD was directed to givecomplete report in this regard and to remove ghost officials from theorganisation and avoid all kinds of political pressure from any side.

Marble City venture

to strengthen stone,

granite sector of

Sindh: SBI chiefKARACHI

StAff RepORt

Sindh Board of Investment (SBI) Chair-man Muhammad Zubair Motiwala onThursday said the marble city projectwould have remarkable investment andgrowth potential for entrepreneurs for it isbased on high-end technology, innovationand services in the stone and granite sec-tor of Sindh province. He said this whilepresiding over a departmental meeting athis office. Motiwala said Sindh govern-ment, through SBI, had already procured300 acres of land near northern bypass forthe development of a state-of-the-art in-dustrial enclave to boost economic activi-ties in this under-developed sector withmore jobs to be created. He said prelimi-nary survey and need assessment studyhad already been conducted.Earlier, SBI Director Project Abdul AzeemUqaili informed the chairman that the Re-quest for Proposal (RFP) was issued to theshort listed consulting firms and consor-tiums to carry out the feasibility studywith technical viability, transaction analy-ses, commercial development plan andother technical and transaction related ac-tivities.The proper study by the final short listedconsultancy firm would facilitate in suc-cessfully materialising this project in theshortest possible time.

ECC age restriction on usedcar imports to boost localauto industry: analysts

lAHORE

App

President SAARC Chamber ofCommerce and Industry (SCCI)Vikramjit Singh Sahnay on Thurs-day hailed Pakistan for validatingratification of visa accord withIndia.

In a message sent to SCCI VP,Iftikahr Ali Malik, SCCI chief saidthat it was a bold and historic de-cision by Pakistan to simplify thecumbersome procedure for thegrant of visa with a view to pro-moting people to people contact.

He said that epoch making de-cision by Pakistan will help en-hance trade and boost business

activities between the two coun-tries. He said that multiple entrieson one year visa with exemptionfrom police report and increase inthe number of cities for visa hold-ers will ensure smooth and fre-quent exchange of traders’delegations of private sectors.

Sahnay said the visa regimeagreement singed by the formerIndian External Affairs MinisterSM Krishna and Pakistan InteriorMinister Rehman Malik will proveto be a milestone in the economichistory of both countries for fur-ther cementing Pak-India rela-tions and strengthening trade inaddition to taking full benefits oftechnical expertise in different

fields. He said that free movementof business community will notonly help improve the business en-vironment but also positively af-fect the entire region of SouthAsia.

SCCI chief said that Pakistanand India, with the support oftheir private sectors, had takenhistoric steps to normalise bilat-eral trade relations.

He said South Asia is thefastest growing region in the worldbut also one of the least inte-grated, while the region’s tradewith rest of the world is growingrapidly, intra-regional trade ismerely 5 percent of its total trade.

Sanhay said that despite being

natural trade and investment part-ners, the volume of trade betweenPak-India, the two largesteconomies of the region, has beenextremely low.

He said that bilateral trade be-tween Pak-India a couple of yearsago stood at an estimated $1.83billion. India accounts for nearly1.2 per cent of Pakistan’s globalexports, while Pakistan accountsfor less than 0.9 percent of India’sglobal exports, he said.

Malik said that the private sec-tors of both countries have to playa key role in the prevailing sce-nario for viable and sustainabletrade relations and for welfare ofthe people of the region.

SCCI chief hails Pak validation for ratification of visa regime

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