Tuesday, 20 December, 2011Pages: 7 profit.com.pk

National Youth Policy and its greyareas Page 2Improving the HD indicators Page 3

ISLAMABAD

JALALUDDIN RUMI

THe government has revised theGross domestic Product (GdP)growth target from 4.2 per centto 3.6 per cent due to September

floods in Sindh, war on terror and overallenergy crisis in the country.

3G license auctionSources well informed with the currenteconomic situation in the country toldprofit, the government is all set to launchthe auction of 3-G licenses to telecommuni-cation companies as the formalities for thelaunch have almost been completed. The firstadvertisement for the auction is to appear innews papers by next week and bidding is ex-pected to be completed by mid March nextyear. More spectrums would be made avail-able for 3/4G services and offered for auctionwith the provision that winners of such auc-tion will receive amended licences and allo-cated frequencies by March 2013 and as suchwill be able to start their services thereafter.

etisalat to release $800m The government is also eyeing to receive$800 million from etisalat in the privatisa-tion process of Pakistan TelecommunicationCompany limited (PTCl) as 95 per cent workon transfer of properties has been completedand it is expected that etisalat will release thisamount within the targeted period. Sourcesinformed that Pakistan’s arrears againstUnited States on account of Coalition Sup-port Fund (CSF) are $2.5 billion and govern-ment has budgeted only $800 million for theongoing fiscal year 2011-12. US has alreadycompleted the processing of $400 million sofar and these funds should come with no fur-ther delay. The sources said Pakistan’s claimis valid as it has incurred these expendituresand therefore the said payment is not part ofan aid package but rather reimbursements.

us reimbursementsexplaining the historical trend of approvalof Pakistan’s CSF claims, the sources saidthat some 60 per cent to 65 per cent claimof CSF are normally accepted by the US and35 per cent claims are not accepted owing todifferent reasons. The sources said that Pak-

istan borrows this money and spends on waron terror and delay in CSF funds are coveredby the tax payers money. Pakistan has timeand again raised this issue with US authori-ties in CSF review meetings.

Govt curtails spendinGOn the expenditures side, governmentspending in the first six months were sup-

posed to stand at 50 per cent of total expen-ditures by december 31, 2011, however, dueto austerity measures ministry of financehas managed it to keep them at 38 percent of the total expenditure and thefinal figure is expected to touch 42per cent of the total with savings of

8 per cent. explaining the savings in expen-ditures, the sources informed that overallcurrent expenditures have been recorded at39 per cent in first five months (Jul-Nov),interest payments have remained at 39 percent of the total allocation and amounted tors34 billion, defense expenditures stood at38 per cent of the total allocation andamounted to rs187 billion, and other expen-ditures stood at 39 per cent or 368 billion.

deficit financinG explaining the resource mobilisation fordeficit financing, the official sources informedthat auction for Sukuk Bonds worth rs50 bil-lion is to be completed by december 20 for M-2, having a valuation of rs250 billion. Sourcesfurther informed that other options that arein hand are exchangeable bonds, interna-tional Sukuk and commercial borrowing.

48b subsidy to power sectorGovernment has so far given rs48 billion

subsidy to the power sector in the first fivemonths of FY12, highest in all subsidy sec-

tors. Some rs20 billion would be dis-bursed under Benazir Income

Support Program till december 31,

2011. The overall price of oil in internationalmarket was $75 per barrel which has in-creased to $105 to $110 per barrel and a baseeffect of $40 per barrel has been faced by theeconomy. Some 40 per cent, or rs.100 bil-lion is to be spent under Public Sector de-velopment Program till december 31, 2011out of a total local components of rs.220 bil-lion, sources said.

11.5pc increase in exportsagriculture growth outlook is positive andfederal revenues have shown remarkablegrowth. exports have also registered a

growth of 11.5 per cent in first five monthsof the fiscal year and imports have witnesseda growth of 20 per cent on receipts basis.Sources informed that government has pro-jected 10 per cent growth in imports and 5per cent growth in exports in it’s balance ofpayment plan and so far trade deficit hasbeen recorded at $6.4 billion in the first fivemonths. In the remaining seven monthsgovernment has a cushion of adding a fur-ther $8 billion in deficit to reach a targetfixed for overall trade deficit at $14.4 billion.

12pc power tariff increase The sources further explained that govern-ment is eyeing no major increase in importsand if exports go even in the negative thebalance of payments would still remain incontrol. The government has projected thata 12 per cent increase in power tariff will berequired for ongoing fiscal year. large ScaleManufacturing (lSM) however, exhibitedgrowth and against the target of two percent the lSM growth has been recorded 3.6per cent in first six months of the ongoingfiscal year 2011-12. remittances have wit-nessed a growth of 80 per cent during firstfive months and stood at $5.2 billion.

3pc drop in consumer price index Consumer Price Index (CPI) has shown adeclining trend and declined from 14 percent to 11 per cent in the first five monthswhile Sensitive Price Index (SPI) also de-picted a declining trend and stood at 4.9per cent, sources remarked. FederalBoard of revenue (FBr) has also col-lected rs712 billion in tax revenues, de-picting a 28 per cent increase in the firstfive months of FY12against rs555 billionin the same period last year.

ISLAMABAD

JALALUDDIN RUMI

Federal Board of revenue(FBr) has collected rs712 bil-lion, depicting a 28 per cent in-crease in the first five and a half

months of FY12 against rs555 billion inthe same period last year. The remainingamount of rs1240 billion has been left tomeet the tax target of rs1952 billion inthe next six months of the current fiscalyear. This was said by Chairman FederalBoard of revenue (FBr) Salman Sid-dique while talking to Media on Monday.

FBr Chairman said rs50 billionwould be added in total collectionthrough administrative measures, rs21billion from flood surcharge arrears, rs10billion from court cases, rs27 billion fromwithholding tax recovery out of which 14billion have already been recovered frombanks and telecommunication compa-nies. detection of wrong GST input taxadjust claims have reached at rs32 billionand FBr has managed to recover 12.2 bil-lion last fiscal and rs.1.2 billion this fiscalyear. He also informed revenue leakagesare being plugged with the help of rev-enue advisory group’s consultation.

Chairman FBr said if present trends ineconomic growth and inflation remain tillthe end of current fiscal year, FBr wouldachieve the tax target. He further said FBrhas also decided to launch risk Based auditPlan based on central risk benchmarks forselection of income tax returns from Janu-ary 2012. This plan would remain underimplementation for next six months andrisk criteria would be forwarded to 21 re-gional Tax Offices (rTO) for selection of in-come tax returns for total audit of incometax returns and said hopes are high that thisaudit would yield good results, he added.

Federal Board of revenue (FBr) hasidentified 0.7 million non taxpayersunder broadening of tax base drive and asthey have created their assets from agri-culture income so as to book them underprovincial agriculture income tax net. Heinformed that a major step is being imple-mented from January 2012 under whichno input tax adjustment would be allowedto GST registered persons who not be de-mand and mention in their monthly re-turns CNIC and NTN of theirun-registered buyers. This would not onlyhelp document the economy, but, wouldalso help increase in revenues within thisfiscal year, he added. Salman Siddique,

FBr Chief said 60 per cent of 0.7 millionnon taxpayers; have reported that theyhave created the assets either from agri-culture income or foreign remittances. Hesaid once the verification of such detailsto be received from provinces for thosewho don’t have agriculture income thenFBr would be taking next step to enforceIncome Tax returns from them.

Salman Siddique also informed thateconomic Coordination Committee (eCC)in its last meeting has discussed the de-mand for restoration of GST exemption ontractors. The demand is being raised thatlocal manufacturers have decreased theproduction of tractors owing to low de-mand because of GST. He informed thatFBr has held meeting with tractor manu-facturers and they have negated this im-pression and said that ZTBl has frozen thecredit line for purchase of tractors that isthe main reason behind this. He said thatin next eCC meeting decision would betaken on this demand. FBr Chief also in-formed that regime for five export orientedsectors is being revamped and soon a newregime with standard five per cent confes-sional rate would be implemented andfinal consultation would be held on theproposed regime on 23rd december.

Govt revises GDP growth target

FBR collects Rs712b tax revenue

The ramifications of KimJong Il’s death Page 5

PRO 20-12-2011_Layout 1 12/20/2011 12:51 AM Page 1

debate02Tuesday, 20 December, 2011

DurDAnA nAjAM

THe only National YouthPolicy of Pakistan wasborn after sixteen yearsof gestation. It wasperhaps, the longest

period in the life of policy making.The year 2008, marks the beginningof a new era in the politicaldevelopment of Pakistan. after alapse of eleven years, democracy wasreturned to the country throughpopular representation. The politicalatmosphere was charged with thedesire to bring Pakistan its lostdemocratic glory and politicalstability by defeating terrorism andthrough institution building. Though,in the course of time, none of thesecould be achieved, and the situationon economic front moved from badto worse. The last nail in the coffinwas hammered by the devastatingflood of 2010 that gobbled billion ofrupees worth of agricultural assets-the lifeline of Pakistan. The militaryoperation of 2009 in Swat is anothersaga that rendered a wide majority ofour population especially the youthhelpless and directionless. Inaddition to these, the war onterrorism at different levels and partsof Pakistan had disarrayed the nationin many respects. amidst this chaoticsituation, somewhere in 2008, theYouth Policy was laid on the table. Itwas as messy as the leadership couldpossibly make it look so. Wrong solutions to rightproblems: The policy talks abouteverything that one could think of, itappeals to one’s emotions throughwords like awareness, patriotism,good citizenship, skilled labour,scholarships, intellectualdevelopment, micro financing so onand so forth. The policy, however,fails to define or perhaps, infuse anylife into these words. The funniestpart is that without having anyarchaeological support, since we aredismantling whatever we have in thename of archaeology, without anyeconomic provision since a lot of ourfund is funnelled in things otherthan infrastructure and without anyreference to the education budgetthat lingers at 2 per cent of theGdP, and without considering thatalmost 80 per cent of this country’syouth lives in the rural setting whomay not even be knowing what itmeans to have a disciplinededucation system, the policy goeson suggesting vocational andacademic trips across the country,

and educating youth throughvideo conferencing, seminars andby interacting with noble

laureates. The policytalks about NationalYouth Fund, not a

single reference ismade to the

indigenousfundraising

methodology, it isagain left to thedonors, philanthropists andbanks to provide for the funds. Inshort the policy is not specific inactions and clear about itsachievement objectives. Lack of interconnectivity inpolicy formulation: In theory, nopolicy can deliver unless all thestakeholders are taken on board tothe aims and objectives of thepolicy. Putting things in black andwhite rarely serve the purpose offacilitating the target group of thepolicy. lack of interconnectivityemerges when one sees disconnectin reality and in the implementationstrategies of the policy. Skill development: a good levelof thrust is laid on skilldevelopment through needassessment but there is no referenceto research and development. Ifone is to prepare the youth for themodern 21 century how could it bepossible without the provision ofresearch and developmentfacilities. Science, research, andtechnology are the prerequisites forthe youth to join the globalscientific revolution.Hazy employment strategy: asfar as employment is concerned, themention of internship could be agood proposal for the freshgraduates, but there is no referenceto the provision of employmentopportunities and labour marketinformation by the government tothe youth. Training and preparingyouth for the job market is missing.Provision of skills does not ensurejob opportunities (as suggested in thereport) it can only raise the chancesof getting a job. In the absence of ajob market, no skill set can be helpfulin making the ends meet. Revival of international sportneglected: Sports activates arereduced to parks and streetgames, the matter of fact is thatPakistan has been systematicallydriven out of sports arena, squashis the right example. No solutionis sought on its revival. Whatwould all those patrons do tosport is also left to guess. Youth in jails: The youth in jailneeds to be rehabilitated throughcounselling, that is the only way tohelps them relate back to a normallife. There are references of skilldevelopment and creativeactivities in the policy for youthsin jail but the psychological part isnot mentioned which wouldeventually help them become nonviolent in the future. No reference of art andculture: The policy is silent overart and culture and its utility indeveloping self-respect and sense ofidentity in the youth. The idea ofjourneying around the country toget a sense of history and heritagemakes little sense, unless people areengaged in cultural activitiesapplying arts and crafts. The radicalisation of youth:The year 1979 and the decadefollowing it gave Pakistan a newidentity- incubator of Mujahedeen,with its periphery loaded withpeople who could be

used to

combat war on the strength of Islamagainst the proposed and at timesdesigned enemies. all through thoseyears, the young lot of this country,in the absence of any direction, flewinto the ranks of those who couldafford them not only direction, butboard and lodging as well,minimising the burden of povertylaid on the parents of these youth bythe misplaced financial priorities ofthe government of Pakistan. Theaim of life designed for these youngrecruits was simple: Obeying thedecree of allah, which actuallymeant standing against any forcethat could be a threat to Islam. Thedefinition of threat was defined bythe providers. On the same tone inthe urban setting; in the absence ofgovernment intervention, theuniversities like Punjab, Karachiand Peshawar became heavilyradicalised. Punjab University gotinto the tangles of Islamisation,while Karachi and Peshawarvarsities brewed ethnicity. Schoolsin Baluchistan had banned thesinging of Pakistan anthem. Thisdisconnect within the societyfurther exacerbated throughdifferent education systems thatwere allowed to operate withinPakistan without any check andbalance. We have had publicschools, private schools, madrassaaand GCSe or IB certificationsystems. The mix is not asdisturbing as the syllabus andcurriculum followed by thesesystems of education. Nocoherence, no linkages and nocoordination. a school can chooseto teach all that it wants to teach toits students. The famous Oxfordschool books developed time andagain under different agenda hadtheir own bidding to make. Ways to go forward: From thediscourse above, one could onlydeduce that this Youth Policy needsa complete over haul. One of themajor flaws in the policy is itsinability to envision the outcome itexpects from different actions itdesires to take. The National YouthPolicy of Ghana 2010, a far lessdeveloped country than us hasmanaged to do so, though there issome similarity in the NationalYouth Policy of Pakistan and that ofIndia but, Indian Youth Policy hasvery clearly stated theresponsibilities of youth and state,since both the entities have stakesin the peace and neutrality of asociety. India’s Youth Policy hasalso very clearly stated thedefinition of youth, making easierfor policy makers to determine needspecific programmes and projects.In the same lieu, australiangovernment have established a“Youth Monitoring Grantprogramme” to de radicaliseits society. The wayforward designed bytheaustralian

policy maker in the context is toengage youth in communitydevelopment by making them theambassador of peace, i.e. givingthem the responsibilities toeradicate radicalisation from thesociety. We need to define what weexpect from the actions given in thepolicy.Let Education Policy be thelynchpin: Youth Policy shouldintersect at some point with theeducation Policy. as has beenenvisaged in the National educationPolicy of Pakistan (2009), theeducation budget awaits revisionfrom 2 to 7 per cent of the GdP.Policymakers, both inside andoutside Pakistan, should givecareful consideration to whetherand how education investments canpromote peace and stability, takinginto account what we now knowabout the state of education sectorand the roots of militancy. Defining obligations: Theobligations of different groupsshould be made part of the policyso that it becomes clear as to who isresponsible of what. Theobligations of state, family,teachers, youth and private sectorshould be discussed in the policy.Then there is a clear need ofinculcating the ideas of democracy,governance and leadership in theyouth. Good governance and civicresponsibilities are the recipes todevelopment. Interestingly, there isno reference in the policy abouttransparency, accountability,protection of rights, obedience torule of law, etc. The development ofthese key principles is necessary forthe development of what is called apatriotic citizen, which the policyclaims to achieve. The issue ofmoral values is left to the ministryof religious affairs. This is bound tomake the society more conservativeand myopic; having multiplereligious sects and extremereligious views.

The writer is afreelance journalistand can be reached atdurdananajam456@hotmail.com

europe, heal thyselfDAnIeL GroS

eUrOPeaN policymakers like toextol the strength of theeurozone: relative to the UnitedStates, it has a much lower fiscal

deficit (4% of GdP, compared to almost10% for the US). Moreover, unlike the US,the eurozone does not have an externaldeficit, which means that the monetaryunion holds enough savings to finance allof its members’ budget deficits and resolvetheir debt problems. But, despite thisrelative strength, the european Union’sleaders seem incapable of resolving theeurozone’s sovereign-debt crisis. despitemeeting after meeting, heads of state andfinance ministers have failed to reassuremarkets. Now, europe’s policymakers areappealing for help from the InternationalMonetary Fund and asian investors. Thisappeal for outside help is misguided, giventhe reasons why the euro crisis has gonefrom bad to worse, despite the eU’sabundant resources. The key problem isthe distribution of savings within theeurozone. The countries north of the alpshave excess savings, but Northerneuropean savers do not want to financeindebted Southern european countrieslike Italy, Spain, and Greece. That is whythe risk premium on Italian and otherSouthern european debt had risen at onetime to 5%, and why, at the same time, theGerman government can issue short-termdebt at negative real interest rates.Northern europeans’ reluctance to investin their southern neighbors is the problembehind the problem. The Germangovernment could change this if it werewilling to guarantee all Italian, Spanish,and other eurozone debt. But it isunderstandably loath to do so, owing tothe high risk involved. The europeanCentral Bank could also help solve theproblem by agreeing to buy debt that hasbeen shunned by financial markets. But,like Germany, the eCB understandablylacks enthusiasm about this solution. Sothe standoff continues, and the crisisworsens. The world’s major central banksrecently agreed to make more dollarliquidity available, mostly to europeanbanks. This has eased the immediateliquidity crisis, but the fundamental debtproblem remains, because the Italiangovernment cannot fund itself atreasonable interest rates. a month ago, theeurozone’s heads of state arrived atanother way to appeal for foreign funds:the european Financial Stability Facility(eFSF) could package euro debt and sell itto foreign investors such as the Chineseand other asian central banks. Here thesame question arises: Why should Chinabuy Italian debt when Germany shuns it?even if China agreed to buy the debt, itwould likely consider buying some of thespecial paper that the eFSF plans to issueonly if it obtained some politicalconcessions and an implicit guaranteefrom Germany. But it makes no sense forGermany to pay a political price for doingsomething – guaranteeing other countries’debt – that it has consistently refused todo. The political concessions that Chinawould probably demand – for example,eU recognition of the country as a marketeconomy, or a greater voice within the IMF– may be overdue. Nevertheless, theseissues should not be linked to theeurozone’s inability to solve its ownproblems. Moreover, a large inflow offunds from the IMF, China, or elsewherecould do more harm than good to theextent that it puts upward pressure on theeuro’s exchange rate – and thus makesrecovery in the crisis countries even moredifficult. German growth could survive astronger euro, because its exports aremuch less price-sensitive, but countriessuch as Italy and Greece, which mustcompete on price, would be weakenedfurther. europe’s policymakers cannotoffshore the eurozone’s problems.europeans can and must deal with thiscrisis themselves. One option discussedthese days is a special fund, financed bythe eCB’s major national central banksand placed at the IMF’s disposal to helpItaly and Spain. This would harness theeCB’s resources without formally violatingthe eU’s lisbon Treaty, which forbidscentral-bank financing for governments.

Daniel Gros is Director of the Center for

European Policy Studies. A version of this

article was first published on Project Syndicate.

National Youth Policy and

PRO 20-12-2011_Layout 1 12/20/2011 12:51 AM Page 2

IT seems that the current political devel-opments which are capricious have over-shadowed the findings of the recentlyreleased UNdP report on the Human de-velopment Index (HdI). Thus far it has

failed to magnetise the attentions of Pakistanimass-media, government, political leaderships,bureaucracy, NGOs, and the civil society at large- a serious neglect indeed. This article is an at-tempt to raise the issue and draw attention ofpolicymakers and the political leadership.

There are startlingstatistics that we all shoulddebate around. Southasian countries in generaland Pakistan in particularhave been struggling toimprove the Hd indicatorswhich currently stand atthe bottom of the ranking’stable. Out of 187 countriesPakistan stands at the145th position, India 134and Bangladesh 146. Pak-istan’s life expectancy atbirth stands at 65.4 years,India 65.4 and Bangladesh68.9. expected years ofschooling in Pakistan are

6.9, India 10.3 and Bangladesh 8.1. Pakistan’s mean years of schooling is measured at

4.9, India 4.4 and Bangladesh 4.8. Gross National In-come per capita as measured in Purchasing Power Parity,for Pakistan, is $2,550, India $3,468 and Bangladesh$1,529. according to the UNdP report, the overall HdIvalue for Pakistan is 0.504, India 0.547 and Bangladesh0.500. Interestingly, tall claims have been made onIndia’s economic performance; however, given the India’scurrent HdI ranking it can be concluded India’s robusteconomic growth has failed to improve the socio-eco-nomic indicators of the country.

Pakistan’s story is no different than other regionalcountries, indeed. due to our own neglect, the economystands in deep waters and socio-economic indicatorshave worsened over the last years. Population explosion,poverty, unemployment, poor economic governance, pre-vailing high level of corruption in the society, low tax-to-GdP ratio, increasing domestic and foreign debt, energycrisis and unsatisfactory security situation are stated tobe real barriers which have negatively affected the socio-economic indicators of the country.

Ironically, Pakistan’s spending on education andhealth is one of the lowest among the developingworld. It is now said that after the 18th amendment,provinces have been empowered to manage health, ed-ucation, social welfare and other ministries. Clearly,the onus is now on provincial governments to step upthe process and make ministries, which they have in-herited from the federal government, more vibrant, fo-cused and professionally driven.

Nonetheless, it seems that education and healthare given the lowest priority by all provincial govern-ments and that they don’t have the capacity to runthese ministries. It is also felt that the working of theministries, which is run by the incompetent corruptbureaucracy, is painfully slow with deep cracks andholes in it. These, however, can be filled if the incom-petent and corrupt bureaucracy is replaced by a newdelivery system which is fair, fast and transparent andis run by dedicated and honest professionals.

To enable the system to work more effectively anddiligently, a more focused and coherent approach is re-quired. Besides making the health and education min-istries more effective, Poverty alleviation Cells are to beestablished in all provinces which are focused on provid-ing effective and immediate social safety nets to the poor.To meet this end a strong nexus of the development sec-tor, local governments, academia, communities, and civilsociety is to be created. This is the only way forward. allpolitical parties must give priority to education and healthin their manifesto and practically demonstrate it insteadof doing the lip-service.

However, all provincial governments should re-alise the gravity of the situation, and showcase seriousefforts to improve Hd indicators. The capacity of therelevant ministries must be scaled up to ensure timelyand smooth delivery of services. This is not a missionimpossible job-it can be achieved if the will of the po-litical leadership exists.

The writer is an Islamabad based freelancecontributor, researcher and trainer. He can be

reached at syed311@hotmail.com

NOT admitting a problemmakes it worse. So when gov-ernment spokesmen claimbeing “alive to economicchallenges”, one cannot be

faulted for foregoing any expectations thatambitious budget projections might havetriggered. For, considering on-ground reality,the optimism immediately following drSheikh’s budget speech can no longer be jus-tified.

like many, we genuinely believed thatambitious growth and revenue expectationsimplied a thorough FBr overhaul coupled in-corporation of serious value addition in ex-ports. and after dr Sheikh’s enlighteninglecture on the benefits of privatisation imme-diately preceding the budget – at our tradi-tional Pre-Budget Seminar – we expected thisfiscal year to finally record unprecedentedprogress on PSe privatisation. These meas-ures are essential to ease the government’sfiscal burden. Both exports and tax reformsare necessary to improve national earning,and that will not materialise absent PSe pri-vatisation, since they bleed the national ex-chequer of billions every year. That the claimsfollowed the 18th amendment, there were

also hopes of the centre and provinces finallyworking like a well oiled machine, leaving thedays of fiscal deficits and financial leakagesblissfully behind. alas, that was not to be.

Instead, neither tax reforms nor a quantumjump in exports have materialised. exports areactually sinking as the international marketcommodity boom that bid up cotton prices lastyear has crashed. Provincial authorities havebeen exposed as incapable of generating rev-enue or handling the additional responsibilitythat has come their way. The result has been in-creased uncertainty and inefficiency. If the gov-ernment were indeed “alive to economicchallenges”, we would have seen steps to in-crease output, improve earning, and stop leak-ages. Half the fiscal is already behind us, withnot much time to show results considering ob-vious lags between policy implementation andresults.

It’s safe to say budget targets will not bemet. and considering the next presentationwill be the last one before the next generalelection, it is difficult to justify official satis-faction with the economic situation. ratherthan forward empty boasts, those in chargeare advised to put some sense in nationalearning before it is too late.

Alive to challenges?

All provincialgovernments shouldrealise the gravity ofthe situation, andshowcase seriousefforts to improve HDindicators

Improving the

HD indicators

Syed Asad Hussain

E D I T O R I A L

Blog for business

BlOGS have become a newecommerce buzz. Marketersare blogging for organisa-tions, products, ideas and orfor other goals and achieving.

a business blog is the one published by orwith the support of an organisation to reachthat organisation's goals. In external com-munication the potential benefits includestrengthened relationships with importanttargeted segments and positioning of thepublishing organisation as industry experts.Blogs are also referred to as tools for collab-

oration, engagement and knowledge man-agement.

Once an organisation has a blog, it offersimmediate and high impact interaction withits target audience. as more people have on-line access, they will want more than thestandard online newsletter or typical Pr re-sponse. long gone are the days when com-panies simply fed information to theircustomers. Now everyone asks for a dialogue- a meaningful exchange of information.Consumers also want to know that organisa-tions are listening to them and paying heedsto what is being suggested.

From a business point of view there areseveral potential reasons to blog particularlyin less connected country like Pakistan. Blogsare no different from channels like video,print, audio and other forms of presentations.This word of mouth (or call it word of mouse)marketing delivers results including strongerrelations with important targeted segments.

Who should blog for the businesses? Ide-ally, front line people who know the business

in and out should blog about it. Marketing pro-fessionals can also use this powerful tool. Or-ganisation can hire professional writers to blogfor them under company's name or blog undertheir own. depending upon the feedback andinformation provided by audience, internalbloggers can develop the ability to write in theirown voice and create content for business blog.On the other hand, external bloggers can viewbusiness with an objective eye and offer freshmarketing ideas and strategies. external blog-gers can study company's marketing materials,reports, other collateral information, and meetkey people in organisation to learn about whatorganisation does and how best to market theproduct through blogging.

earlier, online marketing and websitesnever picked up in Pakistan because of obvi-ous "digital divide that exists due to individualdisparities in levels of income, education stan-dards, psychological reasons, age, gender,rural urban divide, and quality of life or col-lective deprivations like lack of physical infra-structure." Things have changed for the

better. Now the stage isset for Pakistan corpo-rate sector to look atblogging as an opportu-nity to reach out andtake advantages. Bestthing is that local busi-nesses have noticed thegrowing readership andinfluence of these Inter-net postings and thebuzz corporate blogging can create particu-larly as a process of Search engine Marketingor targeting online segment of consumers.

let me add that businesses cannot affordto ignore blogs because blogs are simply themost explosive outbreak in the information erasince the Internet itself. elsewhere, blogs arealready shaking up just about every business.Blogs are a phenomenon that no futuristicbusiness can postpone any further. Given thechanges barreling down upon us, blogs are nota business elective rather a prerequisite. likeanywhere else, blogs can be a welcome mat for

local businesses to reach outacross the world. Pakistanbloggers are exceptionallygood. They have expertisefor corporate writing. Theirlanguage and blogging skillsand networking capabilitiescan be compared with anybloggers' community in theworld. Internet coverageand users' base is constantly

growing. even trend to shop online is takingoff. Given chance, blogging can help any busi-ness directly as well as indirectly. and thewhole world is your market as they say.

My recommendation is that every business,large or small, must start thinking out of the four‘p’ marketing paradigm and have a blog.

The writer is Deputy Controllerof Examinations at Lahore

School of Economics. He blogs athttp://logicisvariable.blogspot.com/ andcan be reached at sajshirazi@gmail.com

S A J Shirazi

For comments, queries and contributions, write to:

email: profit@pakistantoday.com.pk ph: 042-36298305-10 fax: 042-36298302 website: www.pakistantoday.com.pk

babur saGhirCreative Head

hammad raZaLayout Designer

shahab JafryBusiness Editor

ali riZviNews Editor

muneeb eJaZLayout Designer

Tu e s d a y, 2 0 D e c e m b e r, 2 0 1 1

Business blogging isbeing taught in businessschools as a part ofbusiness studies and/oras a part of masscommunication courses

Kunwar Khuldune shahidSub-Editor

maheen syedSub-Editor

Not a good news for general masses

This is with regards to the news report,‘Ticket sales of first private train start’ pub-lished yesterday. Ticket sales of the first pri-vate train in Pakistan might sound like agood news for regular commuters in lahoreand Karachi generally, because the air faresare skyrocketing and buses or any otherpublic transport do not provide necessaryfacilities to the passengers. This venture isno doubt a successful example of public-pri-vate partnership, but the real thing is that itwill cater the business class only and not thegeneral masses. The fact that this train isproviding excellent food and catering facili-ties and air conditioned compartments nar-row down its target audience to onlybusiness class.

AAMIr SuLtAn

FAIsALAbAD

NATO supply disruption

This is with regards to the news re-port, ‘NaTO supply disruption reducestea smuggling’ published yesterday. Itis indeed funny that the durand linehas become a perpetually permeablemembrane with regards to open smug-gling. Now, the news report has high-lighted the smuggling of tea and howthe NaTO supple disruption seems tohave halted the act for the timebeing. Thankfully this has resulted insome legal import finally and onehopes that this trend continues;mind you not only in the realm ofkitchen items. I hope we continue toenhance the legal set up and legaltrade continues and stops being anuisance that it undoubtedly is.

ShAkeeD AhMeD hAShMI

RAwALpINDI

PRO 20-12-2011_Layout 1 12/20/2011 12:51 AM Page 3

Tuesday,20 December,2011

04news

bestway Group founderand chairman, sir anwar pervez

If you only work formoney, you will neverbe a rich man

Jittery KSE gains 54.89pts on Zardari’s returnkArAChI

sTAFF REpORT

aFTer a beat down in thelast two consecutive ses-sions, local bourse posted a

recovery in today’s session albeit aweak one. return of the presidentappeased jittery investor senti-ments as local interest lent somesupport to benchmark KSe-100 ataround the 11090 level. However,foreign investors dwindling inter-est continued to put downwardpressure whilst eNGrO hit thelower circuit breaker.

amidst dreary participation,thinly traded NeSTle and SCBalong with index heavy OGdC sig-nificantly influenced index’s over-all performance. althoughattractive valuations are in the of-ferings, political uncertainty and

external account worries mightbring the bears back.

The KSe 100 index closed at11083.03 levels with the gain of54.89 points, while KSe 30 indexbagged 7.04 points to close at10161.18 levels. all Share indexclosed at 7674.09 levels after gain-ing 35.53 points. Total 116 scrips

advanced 95 declined and 90 re-main unchanged out of total 301scrips traded.

Total volume stood at 36.45magainst the previous volume of47.64m with the negative change of23.48 per cent. While total trade valuewas valued at rs1.36b against the pre-vious value of rs2.00b with the net

change of negative 32.05 per cent.Market capitalisation wasrs2,876.23b against previousrs2,862.75b with the change of 0.47per cent. Volume leaders of today’ssession were lOTPTa, JSCl, eNGrO,dGKC, and FFBl. While major gain-ers at the KSe 100 index were SIlK,aGl, SePl, PKGS, and NeSTle.

Economic Cooperation Organisationinsists upon container train reactivation

kArAChI

wAqAR HAMzA

eCONOMIC CooperationOrganisation (eCO), whilegiving a trade body of Pak-istan a proposal, insistedupon reactivating eCO

containers train, and also asked for usageof the Pakistani route that is currentlywith Turkey and Iran. Moreover, the or-ganisation also asked Pakistani tradebody Federation of Pakistan Chambers ofCommerce and Industries (FPCCI) to in-crease the volume of trade which is veryminimal (around 0.2 per cent) at the cur-rent stage. One of the members of trans-portation committee of eCO told Profitthat during the last meeting held in Pak-istan eCO insisted upon increasing theshare of trade of Pakistan.

He further said that merely 40 percent of NaTO trade is being routed fromPakistan and the rest 60 per cent is beingtransported through Uzbekistan; yet oneof the main issues of low cooperationfrom Pakistan is that eCO secretariat atTehran does not share information withPakistani trade bodies. But, Pakistan hasto sign many important internationalcontracts in order to have a plausible in-crease in its trade volume with eCOcountries, and the main contracts theMinistry of Commerce has to sign are TIr(Transports Internationaux routiers)and a Carnet de Passage, he added. It isto be noted that over 50 countries usingTIP as the international customs transitsystem, while Carnet de Passage is a doc-ument that allows one to cross interna-

tional borders with a vehicle and avoidpaying customs charges. It is pertinent tomention that eCO containers train wasinaugurated in 2009, but only after onejourney it was annulled. So the reactiva-tion of this train would surely help Pak-istan to get better results in terms oftrade increase, therefore, it should be anecessary step for government in the longrun benefit of the country, he added.

ECO TRAIN RAILROAD

The efficiency, growth and output ofregional economic agreements comeafter the creation of infrastructures andincrease in trade facilities in the regionon a gradual basis.

Since the establishment of eCO thesmoothening of transportation and tran-sit among the member countries havebeen deemed necessary and many effortshave been made. In this respect, in thewake of the agreement between Iran,Pakistan and Turkey the railroad for eCOcontainer train was determined and in2009 was tentatively inaugurated in aceremony at presence of officials of thesecountries and heads of railroad adminis-trations of eCO member countries. Thena contract with an International consult-ant group was endorsed on finding theshortfalls of the railroad.

The authorities in charge of the trainhave stated that it was tentatively inaugu-rated to consider the possible problemsarising from discrepancies of rail and lad-ing systems of these countries. as a result,international consultants accompanied

eCO Train through the path Islamabad-Zahedan-Tehran-lstanbul in 2009 to verifythe flaws which were presented to eCOSecretariat in a comprehensive report.

ACHIEVEMENTS

This train has made great achieve-ments in curtailing the transit route ofthe goods initially during 15 days itpassed from Pakistan to Istanbul whichwas decreased to 11/5 days with measuresadopted while it was necessary to spend45 days in order to pass a cargo from Is-lamabad to Istanbul previously.

after consideration over the trainroute by the international consultants ameeting was held in eCO Secretariat inTehran where the soft and hard flaws ofthe railroad route were discussed as theconsultants offered their proposals and ul-timately decreasing the passage time of thetrain to the minimum possible was put onthe priority in planning of the 3 countries.

SPECIFICATIONS OF RAILROAD

The length of the Islamabad-Tehran-Istanbul exceeds to 6,500 kilometers as2,570 kilometers pass through Iran,2,000 kilometers through Turkey andabout 1,900 kilometers on the Pakistansoil. The running time of this route is halfthat of marine cargos and in comparisonto road route is safer and more environ-ment friendly. Capacity for load carriageby the train is currently 20, 40 feet cars.extensive studies carried out and opera-

tionalisation of the plan has resulted inits introduction as an international corri-dor which was fortunately recognised bythe United Nations.

FURTHER POTENTIAL

Moreover the freight capacity of theeCO train along the route, the simultane-ous capability to carry cargos and passen-gers should be noted. Based onconsiderations made by the consultantsof the project, it is predicted that in caseof establishment of Zahedan-Bam routeit will be possible to carry 500 thousandpassengers and two million tonnes ofcargo whose final capacity would be onemillion passengers and eight milliontonnes of cargo annually.

Nevertheless the capacities of theeCO train for cargo and passenger pur-poses have not yet been meticulously ver-ified. eCO train currently operates oncea month although in case of addressingthe flaws and provision of infrastructuresas well as availability of demand, thecargo transportation will be made on aweekly basis. In this project, the role ofIran as a linking hub of Pakistan to the

Indian Peninsula as well as Turkey andeurope is of supreme importance.

EXPANDING HORIZONS

as it was endorsed in the trilateralagreement between Iran, Turkey andPakistan, it was accorded that othercountries may join as government ofIndia was aiming to access the Middleeast and european markets has formallyrequested for accession into the eCOTrain railroad project.

Pakistan railroads Company hasalso received a similar request fromBangladesh where both countries haveconsented to use the Pakistan railroadservices to transport cargo to Middleeast and europe. although this projecthas been designed to promote the eco-nomic relations among eCO membercountries admittedly it is counted as ashort, safe and low cost route for trans-portation of goods between asia andeurope. This rail road counts as thegate of South east asia and europe onthe two sides playing a major role incargo transit and economic develop-ment of the three countries.

Iran 25 cents (euros) 31 cents (euros)Turkey 25 cents (euros) 31 cents (euros)Pakistan 18 cents (euros) 27 cents (euros)

Country Tariff rate for 20feet Tariff rate for 40feetcontainer per kilometer container per kilometer

Govt to ban gasto new skyscrapers

kArAChI

GHULAM AbbAs

THe helpless government, which is yetto formulate a policy to minimise theenergy crisis in the country, has

decided to ban gas connection to newskyscrapers in the country. New buildingswould however, be supplied liquefiedPetroleum Gas (lPG) instead of natural gas,in view of gas shortages and lower pressurein the distribution systems. as no significantwork has been done on exploration of gasreserves in the country despite ever-increasing demands of the fuel, the presentgovernment, as a short term step, hasclaimed to add at least 200 Million BritishThermal Units (MMBTU) additional gas inthe system by June 2012. addressing a pressconference here at the head office of SuiSouthern Gas Company (SSGC) Minister forPetroleum and Natural resources dr asimHussain said on Sunday in order to run gas-fired 650-megawatts Combine Cycle PowerPlant of Karachi electric Supply Company(KeSC) government was working on air-mixof lPG and natural gas to be supplied to theproject at Bin Qasim through a direct line.lPG-air mix/blending is an invisibleapplication of lPG. The air -mix match thatof the Natural Gas. as government wasalready encouraging the use of lPG in thecountry, all CNG stations have been allowedto sell lPG to consumers. Under newstrategy, PSO has already established thefirst and fully operational lPG auto gasstations and conversion centers in thecountry. Talking about $7.5 billion Pak-IranGas Pipeline Project, the minister said that,there was no pressure from any foreigncountry on the issue and work on theimportant project was already ahead ofschedule. In reply to a query, he claimed, thegas supply project from Iran would becompleted by the end of 2013.

State Bank developing comprehensiveliquidity management solution for IBIsKARACHI: Governor, State Bank of Pakistan (SBP), Yaseen anwar has disclosed that the central bank is currently at an advancedlevel of development of a comprehensive liquidity management solution for Islamic Banking Institutions (IBIs) following extensiveefforts made both by the industry and SBP. according to a statement issued by SBP on Monday, delivering his keynote address at atwo-day international conference – Oman Islamic economic Forum – in Muscat, the governor said that this comprehensiveliquidity management solution would include 1) development of Islamic interbank money market, 2) development of IslamicInterbank Offered rate (IIBOr) for use as a benchmark for pricing of Islamic finance products, 3) transformation of a sizeableportion of conventional sovereign debt in the books of central bank into Shariah-compliant debt, 4) allowing IBIs to place surplusliquidity with the central bank to be remunerated based on the central bank’s earnings on Shariah-complaint assets andinvestment portfolio, and v) lender of last resort facility for IBIs. The most challenging and time consuming aspect of thismechanism is the transformation of sovereign debt into Shariah-complaint debt as it involves identification of the assets to be usedfor transformation, their valuation and documentation etc, he said. ‘However, I am confident that with the help and grace ofalmighty allah, we should be able to finalise this mechanism in the near future.’ sTAFF REpORT

43pc importedurea goes untraceableLAHORE: Nearly half (43 per cent)of the imported urea fertiliser is goingto untraceable destinations, despitemarketing through state-run NationalFertiliser Marketing limited (NFMl).This has been reported by divisionalcommissioners in Punjab, who aremonitoring urea sales. It wasdisclosed by Punjab agricultureMinister Malik ahmad ali aulakh,while chairing a meeting to reviewurea position across the province,here on Monday. sTAFF REpORT

PRO 20-12-2011_Layout 1 12/20/2011 12:51 AM Page 4

05

Tuesday,20 December,2011

news

CORPORATE CORNERuniversity of managementand technology hosts iccs-11

LAHORE: University of Management andTechnology (UMT) hosted the 11th IslamicCountries Conference on Statistical Sciences(ICCS-11) at its campus. addressing on theoccasion, dr Hasan Sohaib Murad, rector UMT,welcomed all delegates from Pakistan and abroadto the ICCS-11. He commended the leadership ofIslamic Countries Society of Statistical Sciences fortheir unwavering commitment to the cause oforganising and networking all statisticalprofessions. dr Hasan said that statistics has beena strong suit of Muslims throughout history andeven today. He appreciated the efforts of theIslamic Society of Statistical Sciences on theprogress that it has made to network all instatistical profession from academia as well aspublic and private sectors. pREss RELEAsE

pemra launches complaints call centre ISLAMABAD: PeMra (Pakistan electronicMedia regulatory authority) has established around the clock complaints call centre (0800-73672), to facilitate public complaints against anyaspect of broadcast media or cable TV networksand to take prompt necessary action to address thesame. dedicated and trained staff would beavailable at service of the callers on 24/7 basis.The public can now lodge their complaints,suggestions or comments with regard to services,quality of content of the private TV channels, FMradios and cable TV networks through toll free

number. pREss RELEAsE

unido helps women entrepreneurs indeveloping creativity ISLAMABAD: UNIdO’s Womenentrepreneurship development Programmeconcluded a two week long home textile trainingworkshop that was organised to develop thecreativity of women entrepreneurs for designbusiness. The workshop which was conducted inpartnership with the First Women Banklimited’s Women Business development andTraining Centre in Islamabad, aimed at teachingthe women entrepreneurs creative designing inthe home textile sector so that innovativeproduct range and value addition in existingproducts could be ensured. UNIdO through itsWomen entrepreneurship developmentProgramme is facilitating synergies betweengovernment/institutions level and public andprivate sector support services, to furtherinitiate and to provide gender- sensitizedsupport. pREss RELEAsE

university schoolsystem opens in islamabadISLAMABAD: Universal School System (USS),a world class institution opens its doors for theprovision of Pre–School and day care services ine-11/4 Islamabad. USS believes to offerinternational standard pre-school and day careservices and will encourage constructive,supportive partnership between home, schooland community. USS with fully equippedclassrooms, smart interactive boards, spaciousand well equipped art and activity area andexperienced faculty members, aims to introducea unique educational yet interesting trainingmethodology to nurture young minds. Whileaddressing the audience at the openingceremony, Max Shaw Chairman USS,highlighted the quality education that will beprovided to the children at USS. He also talked

about how the latest British Curriculum wouldbe taught in the school and that all the teachersare TKT(Teaching Knowledge Test) trained bythe British Council. pREss RELEAsE

ifrc world disaster report 2011 stressesneed to deal humanitarian crisisISLAMABAD: International Federation of redCross and red Crescent Societies (IFrC)suggested in the World disasters report (Wdr)2011 that the emerging agenda of futurehumanitarian action will requiretransformations in the behaviour of mosthumanitarian organisations besides changes inthe ways that the international community dealswith future humanitarian crisis. pREss RELEAsE

uaf signs mou on research and trainingFAISALABAD: University of agricultureFaisalabad signed Memorandum of Understanding(MoU) with National Institute of Banking andFinance, Islamabad (NIBaF) and Green CircleOrganisation (GCO), respectively in order tocollaborate in the areas of research, training andbiogas. The MoU with NIBaF was duly inked byUaF Vice Chancellor Prof dr Iqrar ahmad Khanand NIBaF Managing director amer aziz. It wasdecided that UaF will provide its education trainingand research facility while NIBaF will collaboratein research projects at UaF. pREss RELEAsE

The banks have to makeborrowing look bothattractive and safe

consumer credit counselling service(cccs) founder, malcolm hurlston

KARACHI: senator shah Mohammad Afridi is presentalong with the honorable ambassador ofKazakhstan at the ceremony held in the celebrationof the Independence Day of Kazakhstan. Thehonorable ambassador of UAE is also presentamong others at this occasion. PRESS RELEASE

KARACHI: Mr Masood Hashmi, Orientm McCann,with Mr D shikvakumar, senior Vice president NokiaIndia and Middle East, Mr Imran Khalid (Nokiepakistan), Mr A Hussain A basrai (KpMG) and Mssaadia Naveed (English biscuits) present duringMAp Convention 2011. PRESS RELEASE

MUzAFFARAbAD: Chairman pRCs AJK state branchAbdul Hameed sheikh poses for a group photo withvolunteers. PRESS RELEASE

LAHORE: sAARC Chamber’s Vice presidentIftikhar Ali Malik is addressing the seminar uponthe visit of senator Jehangir badr at the LahoreChamber. PRESS RELEASE

The ramifications of Kim Jong Il’s deathg Stocks nosedive, SouthKorea on high alert andtransformation in globalpolitics looms as NorthKorea braces itself for‘heir apparent’

kunwAr khuLDune ShAhID

ONe of the world’s most in-fluential figures and the“Generalissimo” of theNorth Korean nationpassed away owing to

“great mental and physical strain” on Sat-urday. However, his death has been an-nounced by the North Koreangovernment today. King Jong-il was acult figure much like his father Kim Il-Sung, and North Korea is anticipatingthat ‘heir apparent’ Kim Jong would fol-low suit – even though apprehensionsover his upbringing, biography and qual-ification still remain. The news has rever-berated all over the globe and therepercussions are going to encompass allglobal powers and the myriad of stake-holders. What the newsflash has alsodone is that it has upset the applecart ofasian markets, as stocks take a nosedive.

as asian stocks plummeted, earlierlosses sparked by Fitch ratings were ex-tended, and there is authentic concernthat the aftereffects might cut credit rat-ings of european nations. Hong Kong’sHSBC Holdings Plc (europe’s biggestlender), Samsung electronics in South

Korea, China Overseas land and Invest-ment ltd and Billabong International ltdin australia were all on the receiving endof a stock market walloping. and it’s onlynatural, considering the fact that when-ever something unforeseen takes placethe instinctive reaction of the dealers is tolunge towards safety. Obviously the newsof the death and its concerns catered farand wide and the shares of financial com-panies and european exporters also fellowing to the fear that earnings might de-cline if the region’s sovereign debt-crisiswere to expand.

The timing of King Jong-il’s deathhas been quite inopportune for thewest, as things were beginning to ap-proach something bordering on tran-quility on the North Korean front, withthe North Korean hierarchy conspicu-ously gesturing towards suspension of afew fragments of its nuclear pro-gramme. This by no means implies thatall the aforementioned developmentsare dead and buried; but that all thenoises and trends that was whetting theappetite of western powers might beshelved for the time being. Of course,much like pretty much every place onthe world map, US has a special con-cern with regards to North Korea. andhence as the administration changeshands, Washington will be keeping awatchful eye on the unfolding events.

North Korea and US have had a long‘love hate’ relationship – more hate thanlove, one has to admit – tracing all theway back to the Korean war. and recentlyWashington had been busy imposing thenuclear nonproliferation treaty and itsskewed facets at Pyongyang and the latterhas kept on smacking them out of the ballpark. However, considering the fact thatUS had become one of the foremost aid

donors of North Korea after the culmina-tion of the Korean war in 1953, intermit-tent agreements pertaining to Pyongyangtaking the foot off the gas over its nucleararmaments programme were said to beon the horizon. Now, with the heir appar-ent donning the garb of sovereignty, theamerican-North Korean relationship andindeed other allied matters might have tobe reshaped into a new sculpt.

US has agreed on providing food aidto North Korea in a recent meeting be-tween the two nations in Beijing and inturn North Korea gave its word aboutsuspension of its uranium enrichment.Obama and Kin Jong Il recommencedtalks over the matters concerning theirnations in October as well; for, despiteupping the ante in sanctions the Koreanleader didn’t move an inch away from hisstance over the nuclear programme.Washington in turn has been unequivocalin their stance that any further bilateraltalks depend upon North Korea trans-forming its “provocative behaviour”.

Neighbour South Korea, meanwhile,are on a high alert as uncertainty regard-ing the actions in the northern vicinitypersists. and as far as the South Koreanmarket is concerned, its central bankwould have an eye fixed on the matterand might even eye international cooper-ation if things threaten to blow out ofproportion. There are massive implica-tions for South Korea in whatever NorthKorea vies to conjure up, but in the cur-rent nitpicky situation, the potential con-sequences are predictably gargantuan.

domestically, in North Korea, thereare also veritable concerns with regards toa potential Military coup. However, ex-perts opine that since the country hasbraced itself for succession for a good partof a year, the likelihood of either a coup or

indeed an uprising among the masses isminimal. It is also being predicted thatsince Kim Jong Un is a relative newbie andis inexperienced, his complete takeoverwould take its time and that a governingbody should be at the helm till the new

leader is considered ripe enough to or-chestrate matters on his own.

The writer is Sub-Editor,Profit. He can be reached at

khulduneshahid@gmail.com

PRO 20-12-2011_Layout 1 12/20/2011 12:51 AM Page 5

top 5 perForMers sector wisesymbol open hiGh low current chanGe volume symbol open hiGh low current chanGe volume

Food ProducersAL-Noor Suger Mills 52.69 55.32 52.99 55.32 2.63 2,430Bawany Sugar 12.10 13.10 12.10 12.10 0.00 23Colony Sugar Mills 1.65 1.69 1.55 1.59 -0.06 757Dewan Sugar 2.15 2.39 1.90 2.15 0.00 35Engro Foods Ltd. 23.20 23.59 22.72 22.96 -0.24 17,099

Household GoodsDiamond Ind. 8.20 9.18 9.18 9.18 0.98 1Hala Enterprise 6.01 6.90 6.90 6.90 0.89 50Pak Elektron Ltd. 4.06 4.38 3.94 3.94 -0.12 389,302Singer Pakistan 14.07 15.06 13.07 15.06 0.99 501Tariq Glass Ind. 8.30 8.50 8.31 8.39 0.09 11,224

Personal GoodsAmtex Limited 1.19 1.25 1.15 1.15 -0.04 64,200Artistic Denim Mills 20.00 20.00 19.50 19.94 -0.06 2,400Azam Textile 1.11 1.11 1.11 1.11 0.00 1Azgard Nine 3.08 3.15 2.94 3.05 -0.03 952,018Bannu Woollen 14.54 15.20 14.50 14.56 0.02 4,501

Future ContractsAHCL-DEC 26.51 26.60 26.00 26.40 -0.11 214,000ANL-DEC 3.09 3.10 2.86 3.07 -0.02 53,000ATRL-DEC 108.51 108.25 104.60 106.81 -1.70 342,000BAFL-DEC 11.63 11.50 11.45 11.49 -0.14 2,000DGKC-DEC 19.60 19.45 18.60 18.74 -0.86 268,500

Pharma and Bio TechAbbott Laboratories 101.11 102.00 101.00 101.00 -0.11 227Ferozsons (Lab) Ltd. 74.10 76.80 75.50 75.50 1.40 21GlaxoSmithKline Pak. 66.12 66.25 65.11 65.12 -1.00 1,593Highnoon (Lab) 29.60 29.75 29.30 29.30 -0.30 1,151IBL HealthCare 12.60 12.99 12.60 12.99 0.39 1,014

Fixed Line TelecommunicationP.T.C.L.A 9.99 10.12 9.85 10.05 0.06 1,058,174Pak Datacom Ltd 35.09 34.00 34.00 34.00 -1.09 920Telecard Limited 0.75 0.87 0.70 0.77 0.02 159,564Wateen Telecom Ltd 1.75 1.89 1.53 1.71 -0.04 990,262WorldCall Telecom 0.86 0.98 0.77 0.84 -0.02 470,939

ElectricityGenertech 0.28 0.40 0.27 0.30 0.02 3,723Hub Power Co. 35.15 35.45 35.00 35.29 0.14 580,517Japan Power 0.60 0.68 0.50 0.60 0.00 5K.E.S.C. 1.60 1.60 1.53 1.53 -0.07 51,837Kohinoor Power 1.50 1.70 1.60 1.60 0.10 524

BanksAllied Bank Ltd 56.18 56.40 54.50 54.92 -1.26 7,724Askari Bank 9.96 10.00 9.60 9.87 -0.09 108,302B.O.Punjab 4.97 4.92 4.60 4.72 -0.25 1,600,698Bank Al-Falah 11.51 11.69 11.20 11.42 -0.09 976,432Bank AL-Habib 28.71 28.94 28.22 28.26 -0.45 39,928

Non Life InsuranceAdamjee Ins 41.00 42.75 39.11 40.68 -0.32 15,326Atlas Insurance 36.02 36.00 35.00 36.00 -0.02 4,524Central Ins Co. 50.18 50.18 49.60 50.18 0.00 321Century Insurance 6.80 6.78 6.22 6.78 -0.02 18,100EFU General Ins 35.00 35.00 33.25 34.60 -0.40 17,566

Life InsuranceAmerican Life 14.50 14.50 13.50 14.50 0.00 2East West Life Assur 1.40 2.34 1.40 1.40 0.00 1EFU Life Assur 65.53 68.80 65.53 65.53 0.00 157

Financial ServicesAMZ Ventures A 0.35 0.36 0.30 0.32 -0.03 6,625Arif Habib Investmen 14.43 15.35 13.50 14.43 0.00 16Arif Habib Ltd. 14.23 14.99 13.60 14.15 -0.08 23,540Dawood Equities 0.93 0.90 0.65 0.66 -0.27 5,410F. Nat.Equities 2.53 3.44 2.45 2.51 -0.02 14,762

Equity Investment Instruments1st.Fid.Leasing Mod 1.60 1.60 1.50 1.50 -0.10 5,003Atlas Fund of Fund 5.83 5.83 5.30 5.83 0.00 400B.R.R.Guardian 2.26 2.35 2.01 2.35 0.09 1,501Cres. Stand.Mod 0.49 1.48 0.40 0.50 0.01 12,018Equity Modaraba 0.78 1.00 1.00 1.00 0.22 1,002

MiscellaneousCentury Paper 13.25 13.00 12.80 12.80 -0.45 510Pak Paper Prod. 31.29 32.00 31.00 31.37 0.08 2,517Security Paper 35.00 36.75 35.00 36.75 1.75 2,300Pakistan Cables 33.30 33.30 31.64 33.30 0.00 225P.N.S.C. 13.00 13.40 12.70 13.00 0.00 180TRG Pakistan Ltd. 1.19 1.40 1.14 1.17 -0.02 916,357Murree Brewery 63.05 65.00 63.05 63.55 0.50 2,907Shakarganj Food 6.47 7.45 6.47 6.53 0.06 14,000Pak Elektron Ltd. 3.32 3.40 3.30 3.32 0.00 14,694Singer Pakistan 14.06 14.06 13.06 14.06 0.00 66Tariq Glass Ind. 8.15 8.80 8.25 8.25 0.10 1,502Khyber Tobacco 25.37 26.60 25.37 25.37 0.00 305Pak Tobacco Co. 57.92 60.00 56.10 57.92 0.00 404Hum Network Ltd. 16.00 16.00 15.85 15.93 -0.07 1,399P.I.A.C.(A) 1.82 1.90 1.75 1.83 0.01 9,203P.T.C.L.A 10.05 10.27 10.07 10.10 0.05 412,121Telecard Limited 0.77 0.85 0.75 0.79 0.02 1,505Wateen Telecom Ltd 1.71 1.89 1.62 1.75 0.04 26,118WorldCall Telecom 0.84 0.93 0.83 0.84 0.00 36,564Sui North Gas 16.01 16.59 15.90 16.00 -0.01 10,519Sui South Gas 18.23 18.50 17.95 18.37 0.14 20,588EFU Life Assur 64.02 65.00 62.00 62.97 -1.05 6,649Pace (Pak) Ltd. 1.26 1.45 1.22 1.27 0.01 263,072Netsol Technologies 9.24 9.45 9.10 9.10 -0.14 32,099

symbol open hiGh low current chanGe volume

Oil and GasAttock Petroleum 421.38 421.50 413.10 418.11 -3.27 29,477Attock Refinery 107.86 107.60 104.08 106.21 -1.65 844,912Burshane LPG 20.96 21.00 19.92 19.92 -1.04 1,534Byco Petroleum 6.66 6.70 6.35 6.43 -0.23 284,523Mari Gas Co. 88.49 87.05 85.00 85.44 -3.05 26,293

ChemicalsAgritech Limited 15.55 15.55 15.00 15.55 0.00 50Arif Habib Co SD 26.59 26.60 25.80 26.35 -0.24 1,368,405Biafo Ind. 64.99 64.99 61.75 64.99 0.00 10Clariant Pakistan 150.06 149.90 145.00 147.61 -2.45 3,570Dawood Hercules 32.72 32.72 31.09 31.21 -1.51 81,461

Industrial metals and MiningCrescent Steel 19.69 19.00 18.72 19.00 -0.69 1,001Dost Steels Ltd. 1.17 1.22 1.05 1.06 -0.11 52,881Huffaz Seamless Pipe 8.01 8.50 8.00 8.50 0.49 7,937Int. Ind.Ltd. 27.26 27.90 25.91 26.53 -0.73 13,718Inter.Steel Ltd. 10.00 9.95 9.11 9.14 -0.86 59,304

Construction and MaterialsAl-Abbas Cement 2.25 2.40 2.11 2.24 -0.01 26,352Attock Cement 51.25 51.50 48.70 51.50 0.25 1,178Bal.Glass 2.17 1.90 1.76 1.90 -0.27 1,001Berger Paints 14.12 14.00 13.13 13.99 -0.13 4,200Bestway Cement 8.40 8.40 8.40 8.40 0.00 1,600

General IndustrialsCherat Packaging 27.65 27.50 26.60 27.02 -0.63 11,025ECOPACK Ltd 3.32 4.31 3.25 4.22 0.90 623,366Ghani Glass Ltd 40.48 40.00 40.00 40.00 -0.48 1,000MACPAC Films 7.05 7.05 6.60 6.78 -0.27 1,502Packages Limited 77.59 80.50 73.72 75.16 -2.43 34,311

Industrial EngineeringAdos Pakistan 4.89 5.80 4.01 4.89 0.00 12AL-Ghazi TractSPOT 195.84 198.00 191.00 191.46 -4.38 4,442AL-Khair Gadoon 5.00 5.95 4.40 4.88 -0.12 502Bolan Casting 28.50 28.50 27.10 28.50 0.00 50Ghandhara Ind. 6.17 6.84 5.91 6.84 0.67 503

Automobile and PartsAgriautos Industries 58.50 57.00 57.00 57.00 -1.50 500Atlas Battery Ltd. 165.00 166.90 163.10 165.02 0.02 811Atlas Engineering 58.00 58.00 58.00 58.00 0.00 162Atlas Honda Ltd. 121.50 123.00 115.55 121.50 0.00 140Dewan Motors 1.97 1.98 1.70 1.94 -0.03 55,019

BeveragesMurree Brewery Co. 110.49 111.43 109.00 111.18 0.69 1,170Shezan Int’l 150.02 150.00 145.05 145.58 -4.44 203

Mutual Funds

fund offer repurchase nav

Alfalah GHP Cash Fund 501.2900 501.2900 501.2900 Askari Islamic Asset Allocation Fund 114.7196 111.8516 111.8516Askari Islamic Income Fund 103.6501 102.6136 102.6136 Askari Sovereign Cash Fund 100.6900 100.6900 100.6900 Atlas Income Fund 519.3500 514.2100 514.2100 Atlas Islamic Income Fund 519.0900 513.9500 513.9500Atlas Money Market Fund 516.9700 516.9700 516.9700 Atlas Stock Market Fund 453.1500 444.2600 444.2600 Crosby Dragon Fund 82.9800 81.3500 81.3500

fund offer repurchase nav

HBL Money Market Fund 100.2768 100.2768 100.2768 HBL Multi Asset Fund 87.0103 85.3042 85.3042 HBL Stock Fund 97.6745 95.2922 95.2922 IGI Income Fund 101.8987 100.8898 100.8898IGI Stock Fund 112.3545 109.6141 109.6141 JS Principal Secure Fund I 121.5000 111.5200 117.3900 JS Principal Secure Fund II 104.1200 96.5000 101.5800 KASB Cash Fund 0.0000 0.0000 100.1087

Markets

Tuesday, 20 December, 2011

06

top 10 sectors

24% 01%Construction & Materials

Chemicals General Industrials

07%Electricity

02%03%

Fixed Line Telecommunication

01%Equity Investment Instruments

Financial Services

09%Banks35%Oil & Gas10%Personal Goods08%

International Oil PriceWTICrude Oil

$93.60

BrentCrude Oil

$105.90

STOCK MARKET HIGHLIGHTS

Index Change Volume Market ValueKSE-100 11083.03 +54.89 30,482,479 1,328,143,106LSE-25 2751.26 +59.07 1,121,357 29,287,599ISE-10 2559.03 +17.66 48,005 2,509,447

Major Gainers

Company Open High Low Close Change TurnoverNestle PakistanXD 2228.27 2339.68 2240.51 2329.29 101.02 43UniLever Pak Ltd. 5327.60 5480.00 5276.02 5387.25 59.65 43Rafhan Product 2503.89 2599.00 2491.02 2540.00 36.11 11Wyeth Pak Limited 653.12 685.00 650.01 685.00 31.88 58P.S.O. 228.02 237.80 230.99 233.91 5.89 288,100

Major Losers

Engro Corporation 96.73 99.00 91.90 91.97 -4.76 3,493,105Ferozsons (Lab) Ltd. 74.10 72.00 71.00 71.08 -3.02 1,550Tri-Pack Films 167.24 167.99 159.25 164.39 -2.85 24,643Mirpurkhas Sugar 48.40 47.90 46.00 46.24 -2.16 3,822Gadoon Textile 41.79 40.99 40.00 40.05 -1.74 5,676

Volume Leaders

Lotte PakPTA 8.68 9.10 8.70 9.07 0.39 4,913,936Jah.Sidd. Co. 4.52 4.61 4.25 4.27 -0.25 4,317,752Engro Corp 96.73 99.00 91.90 91.97 -4.76 3,493,105D.G.K.Cement 18.69 19.08 17.90 18.10 -0.59 2,764,383Fauji Fert BinXD 45.15 46.50 45.05 45.87 0.72 2,364,934

Bullion MarketPer Tola (PKR) Per 10 Gm (PKR) Per Ounce US$

Gold 24K 53,439.00 45,864.00 1,592.00Gold 22K 51,608.00 44,245.00 –Silver (Tezabi) 971.00 833.00 35.05Silver (Thobi) 1025.00 880.00 –

Interbank RatesUS Dollar 89.8042UK Pound 139.0798Japanese Yen 1.1524Euro 117.0149

Buy SellUS Dollar 89.50 90.50Euro 116.08 117.59Great Britain Pound 138.34 140.02Japanese Yen 1.1424 1.1533Canadian Dollar 85.80 88.18Hong Kong Dollar 11.38 11.63UAE Dirham 24.35 24.57Saudi Riyal 23.86 24.04Australian Dollar 88.32 91.06

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Tuesday,20 December,2011

analysis

07

Rise in global commodity prices anddevaluation have propelled increases in prices.In such high inflationary times, unfortunately,the consumer bears much of the burden

kArAChI

sTAFF REpORT

PaKISTaN’S economy managedto grow by 2.4 per cent in fiscalyear 2010-11 (FY11), despitedevastating floods in the early

part of FY11, says State Bank’s annual re-port on state of the economy released hereMonday. according to report one-fifth ofthe country’s agricultural heartland wasinundated, which interrupted productionprocesses and disrupted subsequent sup-ply of both labour and capital. It is esti-mated that 6.6 million of Pakistan’s labourforce was out of work for two to threemonths, and capital stock worth $2.6 bil-lion (1.2 per cent of GdP) was lost.

SBP report said that while interna-tional response to the devastation wasbelow expectations, it is commendablethat government was able to addressthese challenges despite severe fiscal con-straints. Furthermore, the inherent re-silience of the agriculture sector allowedit to post a bumper wheat crop in the rabiseason and sizeable production of minorcrops (potato, onion, pulses, etc), whichspearheaded the revival, the report said,adding that a spontaneous community ef-fort towards rehabilitation and govern-ment support in the form of cashpayments to flood affectees and providingfree seeds and fertilisers, allowed thecountry to overcome this natural disaster.

according to the report, manufactur-ing sector suffered a serious setback. In-dustrial growth was negative 0.1 per centin FY11, due to flood-driven supply chaininterruptions; prolonged power outages;and reduction in gas supplies. Services,on the other hand, supported growth onthe back of a rise in government salariesand defense spending. The overall growthin services was 4.1 per cent in FY11, whichwas lower than the target 4.7 per cent, butthis still accounted for 90 per cent of realGdP growth, the report added.

It said Pakistan’s fiscal position re-mained under stress during FY11, with abudget deficit of 6.6 per cent of GdP,compared to a target of 4.0 per cent. Theimplementation of the reformed generalsales tax; the broadening of the incometax net to include agriculture and serv-

ices; the phasing out of subsidies in atimely manner; and the restructuring ofloss-making public sector enterprises –were either delayed, or not implemented,the report added.

On a positive note, government wasable to contain its spending compared toFY10. Budgetary expenditure in FY11was 18.9 per cent of GdP, against 20.5per cent in the preceding year, the reportsaid, adding that large fiscal deficit di-rectly impacted Pakistan’s debt burden,as stock of public debt and liabilities (ac-cumulated deficits) posted an increase ofrs1,763 billion in FY11, to rs11.0 trillion(60.9 per cent of GdP). Interest pay-ments alone accounted for 32.8 per centof government revenues last fiscal year,which means a further squeeze on gov-ernment’s ability to use fiscal policy topromote economic growth, it added.

However, Pakistan’s external debt re-mains comfortable, especially within thecontext of the acute problems facing theeurozone, the report said and added thatduring FY11 most of the increase was onaccount of currency revaluation, as USdollar lost value against other hard cur-rencies. The funding that Pakistan actuallyreceived during FY11 was largely utilisedfor the servicing of external debt, it added.

SBP report stressed that the financingof the fiscal deficit was, and still remains,challenging. ‘With a decline in externalfunding following the suspension of theIMF Stand-By arrangement (SBa), thegovernment had little choice but to rely in-creasingly on domestic sources. duringFY11, government borrowed rs1.1 trillionfrom domestic resources, which accountedfor 91.0 per cent of the fiscal deficit,’ it said,adding that within domestic sources, theheavy reliance on commercial banks notonly crowded-out the private sector, butalso complicated monetary management,as banks focused increasingly on short-term T-bills to place their surplus liquidity.as a result, private sector credit only grewby 4.0 per cent in FY11, as compared to anincrease of 74.5 per cent in governmentborrowing from commercial banks, it saidadding: ‘In our view, since commercialbanks were lending to the government atattractive rates, this left little incentive tofund private businesses.’

It said that retail prices also increasedbecause of supply side factors, includingthe impact of floods and the rise in interna-tional commodity prices. ‘Food inflationwas particularly hard hit, posting a sharp21.3 per cent year-on-year increase in Sep-tember 2010, compared with 10.4 per centin the same month a year earlier – food in-flation remained about 19 per cent in thefirst half of FY11, SBP report said, addingthat with headline CPI inflation also indouble-digits throughout the year (it aver-aged 13.7 per cent for the year), SBP re-sorted to monetary tightening with anincrease in the policy rate from 12.5 percent in end-FY10, to 14.0 per cent in No-vember 2010 – for the remaining part ofFY11, the policy rate was kept unchanged.

acknowledging the importance of en-ergy as a key factor of production, the re-port devoted a full chapter to assessPakistan’s energy shortage. It pointed outthat the government’s response to energyshortfall was threefold: (1) commissioningof rental power projects (rPPs); (2) resolv-ing circular debt issue by injecting rs120billion; and (3) increasing electricity tariffsto pass on the higher cost of production. Inspite of these measures, the overall situa-tion remained largely unchanged.

The report said that commissioningrental Power Projects (rPPs) to increasegeneration capacity was misplaced, asPakistan is operating well below its in-stalled capacity due to the circular debtproblem. It also noted that the rs120 bil-lion injected by the government (to restartthe funding of furnace oil) only happenedin May 2011. In effect, for most of FY11,the acute problems in the power sectorwent unaddressed, the report added.

Presenting the FY12 projections, theSBP report said: ‘we project GdP growthto be in the range of 3-4 per cent’ andadded that the likelihood of achieving thenon-tax revenue target (as shown in Fed-eral Budget) is also low for several rea-sons. ‘In view of this, SBP projects a fiscaldeficit of 5.5 to 6.5 per cent of GdP, witha bias on the upside,’ it said, adding: ‘Inour view, policymakers may consider for-mulating a comprehensive medium-termfiscal reform masterplan, which is stag-gered and sequenced on the basis of thehard lessons of the recent past.’ ‘Coordi-

nated documentation; transparent collec-tion with oversight; an equitable plan tocapture all commercial businesses and in-stitutions into the tax net; a restructuringagenda for loss-making PSes; and a cred-ible enforcement mechanism, must an-chor this masterplan,’ the report added.

SBP expects inflation to be within aband of 11.5 – 12.5 per cent in FY12,which is broadly in line with the annualtarget of 12 per cent,’ the report added.

On the monetary policy side, the reportsaid, the sharp cut in discount rate in FY12,has surprised the market. ‘With inflationeasing somewhat and banks increasinglyinclined to place funds with the govern-ment, the degree of crowding out of the pri-vate sector required policy intervention’ itsaid, adding that although SBP is stillwatchful to ensure that lending rates do notbecome negative in real terms, we shareglobal concerns about stagnant growth andrising unemployment.’ SBP identified awindow of opportunity, whereby privateinvestment and employment generationwould be given due importance, the reportsaid adding that there was also a need tohalt the growing dominance of debt servic-ing in the federal budget.

‘Finally, the outlook for Pakistan’scurrent account balance remains a sourceof concern, but we remain hopeful ofsome upside on strong worker remit-tances and a possible recession in theglobal economy,’ the report said andadded: ‘although data for the first fourmonths of FY12 shows a current accountdeficit of $1.6 billion, we attribute this totemporary events (bulky oil paymentsand a seasonal pause in remittances inSeptember 2011, and an engineeredshortage of hard currency in the parallelFX market).’ Going forward, we expect acurrent account deficit of 1.5 to 2.5 percent of GdP, which is relatively smallgiven our past performance, it said, how-ever adding that the financing of this cur-rent account deficit could be challenging.

‘We also think the market is over-react-ing to Pakistan’s FX debt payments in FY12.One must realise that while repayments onthe IMF’s US$ 8.9 billion SBa will start thisfiscal year, outflows are only $ 1.4 billionand are scheduled for the latter half of thefiscal year, the report pointed out.

Country’s economy growsby 2.4 per cent in FY 2011g 6.6m labour force remained out of work for 2 to 3 months g manufacturing sector suffers serious setback

sbp annual report

kArAChI

sTAFF REpORT

ON Monday, US dollar has touchedits all time high selling at 90, andone of the main reasons conducive

for Pakistani rupee depreciation is widen-ing current account deficit. That made thePKr depreciate sharply after hitting a 116-day low of PKr 90 per US dollar in inter-bank on december 19. On december 16rupee posted a slight rebound to 89.565.rupee has seen more volatility since thestart of december 2011, primarily owing toliquidity shortage and secondly as concernsover Pak-US ties intensified. Over the pe-riod PKr has shredded almost 4.2 per centFY12Td while on annual comparison thistranslates into 9.5 per cent depreciation.PKR LIKELY TO REACH 91.6/USD :Saad Khan at aHl said that in comingweeks we expect PKr to broadly remainstable after a recent boost in FX reserves of$10 million, allowing the total reserves toreach its $16.69 billion mark. FY12 C/A DEFICIT FORECASTS TOUSD3.3BN: He further said we expect a

sharp downward adjustment in the c/adeficit in FY12. Our revise estimate sug-gests c/a deficit likely to reach $3.3 billionby FY12-end or 1.4 per cent of total GdP.This in our view is likely to come on theback of sluggish export growth of five percent YoY to $26 billion, due to lower com-modity prices but also due to the noticeableslowdown in energy constraints. While ourimport projections remain on the higherside at $41.1 billion (15per cent YoY) owinghigh energy based consumption. Incorpo-rating these changes we estimate the tradedeficit likely to hover around $14.7 billionagainst $10.5 billion in FY11, he added.IMPORTS DROP TO LOWEST DUR-INg THE 5MFY12: The latest balance ofpayments data for the period 5MFY12 pointedto a current account (c/a) deficit of $2.1billion,against $478million corresponding periodlast year. However, interestingly the break-upof current pattern of deficits reveals that it isnot based on rising import bill, which for themonth stood at $2.99 billion, down by sevenper cent MoM. The overall energy based im-port still showed a handsome growth of eightper cent MoM (two per cent YoY).

kArAChI

JAVED MAHMOOD

THere is a huge contrast in theexports statistics reported by theState Bank of Pakistan and theFederal Bureau of Statistics. as

per SBP data, exports of the countryamounted to $1.9 billion in November 2011,whereas the FBS has estimated $1.55 billionexports last month that indicates a variationof about $350 million in just one month. asSBP maintains the balance of payment ac-count, analysts give more importance toSBP’s statistics, says Muzzammil aslam ofJS research. This variation in estimates ofexports by SBP and FBS is available only forthe month of November 2011.

according to FBS, in five months ofFY12, exports showed 7.64 per cent growthin dollars and 9.02 per cent in rupees. FromJuly-Nov FY12 the exports increased to$9.38 billion, from $8.72 billion in same pe-riod in FY11. Pakistan posted a current ac-count deficit of $2.1 billion in 5MFY12compared to $589 million in the correspon-ding period last year. The surge in current

account deficit is due to a combination ofslowdown in exports and surge in imports,driven by higher oil prices. In this financialyear the imports growth is expected to re-cede due to decline in oil prices globally.This can be validated from Saudi arabia’splan to increase its oil output while shat-tered confidence in the western economiesis expected to lead to slower global demand.Hence, demand for oil is likely to be on thelower side in the coming months. after abrief spell of a surplus of one year, Pakistan’sexternal account has reverted back to itsusual deficit track. The deficit is mainly ledby higher import bill, up by 20.5 per centduring 5MFY12. already in 4MFY12, bothpetroleum products and crude oil registereda hefty growth of 46 per cent YoY and 76 percent YoY, respectively. as a result, the shareof oil imports rose to 41 per cent of the totalimport bill against 33 per cent in last year.The rise in oil imports is mainly driven byhigher international oil prices which regis-tered an average growth of 38 per cent YoY.average oil prices in 4MFY12 were reportedat $107 per bbl versus $77 per bbl in the cor-responding period last year. Going forward,

we expect import growth to recede due todecline in oil prices globally. Compared tothe 5M average of $1,048 million, Novem-ber witnessed a drop in remittances to $925million. “We believe the slowdown in remit-tances could be attributed to the sharp rupeedepreciation and the deepening politicalcrisis,” Muzzammil added. looking for-ward, analysts expect remittances to revertback on track once political uneasiness inthe country calms down. Pakistan’s finan-cial account surplus has rapidly been deplet-ing and was reported at $169 million in5MFY12 compared to $563 million last year.The decline is primarily attributed to slow-down in FdI to $408 million vs. $577 mil-lion reported last year. also the globalrecessionary woes have reinforced foreign-ers to cut down their portfolio investmentsas $99 million worth of outflows were wit-nessed in 5MFY12 versus $173 million in-flows last year. due to sharp increase intrade deficit, slowdown in current transfersand financial flows, country’s balance of re-serve witnessed a depletion of $1.70 billion.It may extend further as IMF payments aredue from February 2012.

us dollar touches all time high $350 million variation in sbp, fbs data

Govt gives greensignal to new carmanufacturers

LAhore

IMRAN ADNAN

TO cut the prices of locallymanufactured cars, federal ministryof finance, economic affairs,

statistics and revenue finally give goahead to new entrants to import completeknock down (CKd) kits at customs dutyrate of 32.5 per cent and 20 per cent incase of cars and light CommercialVehicles (lCVs), respectively. Ministry offinance has issued notification (SrO1098(1)/2011) on Friday, which amendsSrO 693(1)/2006, dated 1st July, 2006.The notification states, “…the additionalcustoms-duty leviable under thisnotification shall not be charged on sub-components and components, imported inany kit form by an assembler ormanufacturer declared to be a newentrant by engineering developmentBoard (edB), for the vehicles specified inthe said table for a period of three yearsfrom the start of assembly ormanufacturing of respective vehicles,subject to following conditions, namely:(i) The new entrant assembler or

manufacturers shall chalk out a plan forprogressive manufacturing of the vehiclesspreading over a maximum period ofthree years within which, he shall catchup with the localisation or indigenisationlevel of respective vehicles, as approvedby auto Industry developmentCommittee (aIdC) of edB;

(ii)The continued non-levy of saidadditional customs-duty shall becontingent upon the achievement ofindigenisation as determined by aIdCof the progressive annual edB. In caseof any material deviation by the newentrant, aIdC shall determine thestoppage or withdrawal of theincentive of non-levy of saidadditional customs-duty, allowed assuch, retrospectively;

(iii) The new entrant shall abide byall the terms and conditions laid downin the separate notifications issued bythe ministry of industries and FBr forassembly or manufacturing of the saidvehicles under auto Industrydevelopment Programme (aIdP) andTariff Based System (TBS);

(iv)The additional customs duty shall belevied on the sub-components andcomponents which becomeindigenised by the new entrantassembler or manufacturers, inaccordance with the said plan forprogressive manufacturing.”

procter & Gamble pakistan countrymanager, Qaiser sharif

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