Announcement

**Toramana** · 01-11-2013, 10:20 PM

ISLAMABAD: Federal Minister for Finance Dr Abdul Hafeez Shaikh invited the General Electric Company (GE) to invest in Pakistan particularly in sectors where it had global expertise like aviation, transport, railways, energy and alternate energy.
General Electric Company Vice Chairman John Rice expressed keen interest for investment in various sectors in Pakistan particularly supplying locomotives to Pakistan Railways and set up a wind energy projects in the country while exploring other investment opportunities.
Shaikh said that Pakistan offered a favourable environment for foreign investment and assured full support and facilitation of the government for investment by the Fortune 500 company.
GE’s vice chairman Rice expressed his gratitude to the Government of Pakistan for providing attractive opportunities for foreign investment in the country. He thanked finance minister Shaikh for his continuous support to the private sector businesses and attracting investment by guiding foreign investors.
Rice appreciated the policies of the Ministry of Finance in promoting a business-friendly environment.
GE is a US-based multinational conglomerate corporation and operates through four segments: Energy, Technology Infrastructure, Capital Finance and Consumer and Industrial. In 2011, GE ranked among the Fortune 500 as the sixth-largest firm in the US by gross revenue, as well as the 14th most profitable.

General Electric keen to invest in Pakistan – The Express Tribune

**Toramana** · 01-11-2013, 10:23 PM

Pakistan Railways: Private trains contribute 26% to passenger revenue

LAHORE:
The cash-strapped Pakistan Railways (PR) appears to be benefiting from its joint ventures with private companies: officials at the state-owned company admitted that the partnerships accounted for 26% of total passenger revenues for the railways, despite accounting for less than 1% of passenger traffic, during the first six months of financial year 2013.
Revenues for the Railways were up by 19.9% to Rs7.7 billion during the period between July 1 and December 20, 2012, compared to the same period in the previous year. Nearly 89% of that increase came from rising revenues in the passenger segment of the Railways, and nearly all of that increase came from the two public-private partnerships, where companies have leased out routes from Pakistan Railways. Passenger services account for nearly three-quarters of all Railways revenue.
In February 2012, Pakistan Railways signed an agreement to allow the Four Brothers Group, a diversified conglomerate, to run the Business Express, a refurbished train to that travels between Karachi and Lahore. The Railways gets Rs3.1 million per day for the service as a flat fee for the use of its stations and tracks. In March, a similar agreement privatised the newly revitalised Shalimar Express, operated by Air Rail Services, which provides the Railways with Rs1.5 million in lease revenues per day.

Both of these trains have carried around 400,000 passengers since they began services, a tiny fraction of the nearly 65 million passengers that the Railways served in the financial year ending June 30, 2011, the latest for which figures are available.
Pakistan Railways has 92 operational trains. The two of them that are currently privately operated account for more than a quarter of all revenues. These two routes have caused the passenger segment of the Railways to turn a small operating profit of Rs30 million for the first time since 2006.
That profit, however, is less a reflection of a turnaround at the Railways and more a preview of how much a full privatisation would benefit the state-owned company.
And the figures from the Railways mask an even greater problem. The company has massive pension liabilities which it is unable to pay. The federal government has directly assumed the responsibility for paying these since the death of a pensioner who passed away while waiting in line for his pension outside a National Bank office in Lahore in 2011.
And it cannot even afford to pay its own salaries, which are also paid for by the federal government. The net loss for Pakistan Railways for the first half of the financial year ending June 30, 2013 was over Rs1.5 billion. The Railways have not turned a net profit since the end of the Ayub Khan administration in the late 1960s.
The Privatisation Commission lists Pakistan Railways as a state-owned entity that is up for sale. Yet the left-leaning government led by the Pakistan Peoples Party seems to loathe privatising an entity that – with over 82,000 employees – is one of the largest employers in the country. An outright privatisation would almost certainly mean massive job losses, since the Railways have massive redundancies in their workforce.
And so the government appears to be pursuing what can only be described as a backdoor privatisation, where certain routes are leased out to private companies to run in exchange for fixed revenues. In addition to the two that started last year, a third train – the Night Coach – has also started service from Karachi to Lahore. It is also operated by Air Rail Services and its lease payments are set at Rs1.7 million per day.
“In the coming days, we are hoping that passenger revenues will reflect the expected increase from the latest joint venture,” said Zubair Shafi Ghauri, the spokesperson for Pakistan Railways. “We are now looking for some short-distance joint ventures from remote junctions to facilitate the rural population, though nothing is final yet.”
Whether or not this business model is sustainable is an open question. The management of the Business Express claims that their operational breakeven occurs at 55% occupancy levels, which they are only marginally above, despite operating on the popular Lahore-Karachi route. The Shalimar Express is faring a little better, with a 71% occupancy rate on the same route, with a slightly smaller train.

Pakistan Railways: Private trains contribute 26% to passenger revenue – The Express Tribune

**Toramana** · 01-11-2013, 10:29 PM

KARACHI: Among the four provinces of Pakistan, Balochistan has the highest percentage of residents, who expect to start a business within the next three years, according to the Global Entrepreneurship Monitor (GEM) 2011, which was released in a ceremony at the Institute of Business Administration (IBA) on Wednesday.
About 36.3% people in Balochistan reported that they expected to set up a business in the near future in contrast to 34% in Khyber-Pakhtunkhwa, 26% in Sindh and 23% in Punjab, the study said.
The study was carried out in 54 countries of the world to gauge entrepreneurial attitudes, activity and aspirations besides uncovering factors that determine the nature and level of entrepreneurial activity in a nation.
While 32.2% Pakistanis said they personally knew someone, who started a business in the past two years, the percentage of such people in Balochistan was 42.2%, highest among all provinces, reflecting the increased entrepreneurial activity going on in Balochistan.
Similarly, while 39.7% people reported on a national level that good start-up opportunities existed where they lived within the next six months, the percentage of Balochistan-based respondents with awareness of start-up opportunities in their neighbourhood was 56.6%.

Moreover, 85.1% people in Balochistan think that those successful in starting a new business have a high level of status and respect in society as opposed to the people of Punjab, for example, where 67.3% people relate entrepreneurship with status and respectability.
The report says that the number of people in Pakistan with a positive attitude towards entrepreneurship is less than the average of its factor-driven peer economies, which depend on subsistence agriculture and extraction of natural resources.
The total early-stage entrepreneurial activity (TEA) rate, which is the sum of nascent entrepreneurship rate and new business manager rate, in Pakistan is 9%, according to the GEM 2011 report.

This is lower than the average TEA rates for the factor-driven economies (14.2%) and efficiency-driven economies (13.8%), which have a higher degree of industrialisation and economies of scale.
However, Pakistan’s TEA rate is greater than the average TEA rate of innovation-driven economies (6.9%), which are research-oriented with expanding services sectors.
Given that the TEA is classified into two types – opportunity-based TEA and necessity-based TEA – roughly 4% of Pakistanis are involved in opportunity-based early-stage entrepreneurial activity, the report says, which is considerably less than the average of factor-driven economies (8.5%) and efficiency-driven economies (9%).
The male TEA rate in Pakistan is more than eight times that of the female TEA rate. The gender gap is pretty high as compared to other factor- and efficiency-driven countries.
The report says that the established business ownership (EBO) rate in Pakistan is 4%, which is lower than the average EBO rates for Pakistan’s peer factor-driven (6.2%), efficiency-driven (7.5%) and innovation-driven (7.2%) economies.
Also, the report states that over 9% of the adult population in Pakistan is trying to start a business (nascent entrepreneurs) – a ratio that is lower than the average of factor-driven economies (14.2%).
Speaking on the occasion, IBA Dean and Director Ishrat Husain said the findings of the GEM report would help policymakers devise better strategy to understand the dynamics of entrepreneurship in Pakistan.
“It’s heartening to know that some people still pay attention to research,” Husain said, adding that most guests on TV shows express strong views, which are based on emotions rather than empirical evidence.

Percentage-wise, Balochistan trumps others in aspiring entrepreneurs – The Express Tribune

**Toramana** · 01-11-2013, 10:32 PM

ISLAMABAD:
Two more trains under public-private partnership will commence soon and the double track connecting Karachi and Lahore will be completed by March 2013, said an official of the Pakistan Railways.
The official said that not a single locomotive had been added to the national carrier’s fleet since 2008. He said that the company was ready to provide track facility to the private sector if it wants to run its own locomotives.
He said that the railways was heading towards revival swiftly as number of steps were taken to steer it into profitability. Fuel and utility bills were eating up a bigger portion of the government’s funding to railways. Since 1995 the fuel prices had registered 800% increase, while the national carrier increased fares for freight trains and passenger services by 105% and 70% respectively. The Railways presently has 100 locomotives to run its entire operation, including 200 passenger and freight coaches.

Pakistan railways: Public-private services to commence soon – The Express Tribune

**Toramana** · 01-11-2013, 10:34 PM

ISLAMABAD: The Senate Standing Committee on Commerce on Wednesday recommended certain amendments in the Trade Organisation Bill, 2012.
Chairing the meeting of the committee, Senator Haji Ghulam Ali said there were certain recommendations given by the stakeholders regarding the bill which should be considered by the committee.
The committee recommended that the name of district chambers should be with the name of concerned districts or where the chamber was being established. Further it was recommended that the chambers will be established in districts and not in divisions.
“The presentation of the associate sectors or small businesses should be ensured and the division of small traders and corporate sector should be discouraged,” the committee said. The nomination for president of chambers shall be on a rotational basis – alternative tenures of a year between associates and the corporate sector – was also recommended.
Besides, the committee recommended that the period of suspension of the membership will be reduced from two years to four months with a penalty of 50% of the membership fee for late payers of dues.
Moreover, the nomination of president for federation body will be on the rotation basis from each province for one year and in addition, vice president will be nominated for the federation body from province’s women chamber on a rotational basis.
The Director General of Trade Organisation shall not be replaced by the regulator, the committee said.
Speaking in the meeting, Commerce Secretary Munir Qureshi said that the committee on commerce and the ministry had taken all stakeholders in confidence regarding the amendments to the bill. “The chambers play a vital role for broadening the net base in the country, which is beneficial for the government and the business community,” he added.

Senate recommends amendments in Trade Organisation Bill – The Express Tribune

**Toramana** · 01-11-2013, 10:35 PM

ISLAMABAD: The commerce ministry is planning to announce the Trade Policy 2012-13 by the end of this month after getting necessary approvals from the Cabinet, said Ministry of Commerce Secretary Munir Qureshi, while speaking to the media after the meeting of the Senate Standing Committee on Commerce.
Qureshi said the ministry had already discussed the policy with the prime minister and it will be presented in the cabinet meeting to be held in the next few days for approval.
The total trade volume envisaged in the policy was $95 billion, he said. The sensitive list containing 1,700 items will be reduced to 100 items by 2017 and about 320 items will be reduced each year, he added.
There is proper system with the National Tariff Commission (NTC) to protect the interests of the local industry, he said. “Besides, we are in the process to restructure the commission to make it more effective for protecting the local industries,” Qureshi added.

Ministry of Commerce: Trade policy to be announced by end of January – The Express Tribune

**Toramana** · 01-11-2013, 10:38 PM

BEIJING: In the future, China will encourage more purchases from trading partners that have signed free trade agreements (FTAs) with the country, such as Pakistan, New Zealand and Association for South East Asian Nations member countries.
To boost imports, the State Council – China’s cabinet – has pledged to cut import duties on selected energy products and raw materials and consumer goods, says a statement printed in the China Daily. Vice Premier Li Keqiang has said that China will import $10 trillion worth of goods and services in the five years ending 2015, the paper said.
In 2011, China’s imports reached $1.74 trillion, accounting for 9% of global trade. That amount is expected to grow by about $100 billion annually. In 2012, the figure rose to $1.82 trillion. The country had set a 10% target for foreign trade growth in 2012, and official estimates are that combined imports and exports are expected to top $3.87 trillion during the year.
Commerce Minister Chen Deming announced in December that China’s share of global trade increased to 11.1% in 2012 from 10.4% a year earlier, the paper reported. China, for the first time, replaced the US as Japan’s largest trading partner in 2007 with a record value of trade between the two countries.
Japan’s exports to China grew by 21% to 1.3 trillion yen ($14.76 billion) in 2011, almost double its growth in exports to the US. The figure represented a high demand for Japanese manufactured goods, as well as greater shipments of finished products.

China to increase purchases from Pakistan – The Express Tribune

**Toramana** · 01-11-2013, 10:41 PM

ISLAMABAD: The Ministry of Commerce issued directives to 16 commercial attachés in different countries to lure foreign investment in the country.
Member of Senate Standing Committee on Commerce Senator Karim Ahmed Khawaja said the directives were issued in compliance with the recommendations given by the committee to the commerce ministry. The directives were issued to commercial attachés in the United Kingdom, Canada, the United States, India, Australia, Hong Kong, Malaysia, Singapore, Thailand, Bangladesh, Sri Lanka, Germany, France, South Africa, Tanzania, Kenya, Oman, Qatar, Kuwait, Saudi Arabia and Iran.
The proposal was initially moved by Khawaja in a bid to enhance volume of foreign investment in the country. He said the Pakistani-origin businessmen, who have established their businesses abroad since 1947, should be contacted.

Khawaja held a meeting with the Commerce Secretary Munir Qureshi in which a framework was prepared to materialise the proposal. “During the meeting with the secretary commerce, 16 countries were identified for exploring investments and all the necessary work has been done in this regard,” Khawaja added.
He said a good amount of foreign investment can be attracted because Pakistani expatriates still have affiliation with the country. “During my visits to different countries, I met Pakistani nationals settled over there and they expressed their desire to come to Pakistan with investment,” Khawaja added.
Replying to a question, he said that the modalities for incentives will be prepared after approaching and negotiating with them.

Attachés directed to lure in foreign investment – The Express Tribune

**Toramana** · 01-11-2013, 10:43 PM

KARACHI:
The number of mobile cellular subscribers in Pakistan surpassed 121.6 million at the end of October 2012, according to latest statistics released by the Pakistan Telecommunication Authority (PTA).
Mobilink maintained the top position with 36.389 million subscribers at the end of October, adding 314,782 subscriptions for the month. Telenor, the second largest operator in terms of subscriber base, remained number two with 30.429 million subscribers. It added 266,029 new subscribers to its network.
Ufone once again stood third by adding 243,194 subscribers to take its overall subscriptions to 24.072 million. Zong added 150,353 subscribers to stand at number four with 17.951 million subscribers.
Warid – for the first time in months – showed a positive growth. It added 114,551 new subscriptions and stood fifth with 12.761 million subscribers in October last year.
Overall, cellular teledensity increased to 68.8% in October compared to 68.3% in September 2012.

Telecom giants: Subscribers rise to 121.6 million – The Express Tribune

**Toramana** · 01-11-2013, 10:46 PM

ISLAMABAD:
Trade normalisation with India can augment national wealth by over Rs470 billion per annum in addition to benefits of Rs70 billion to consumers in the shape of cheap imported goods, but all this requires outsmarting cunning Indian negotiators, according to the findings of an independent think tank.
Dr Hafiz Pasha, former finance minister and vice chairman of the Institute of Public Policy, said the institution’s research shows Pakistan’s economy can grow by an additional 2% per annum if both the countries bring an end to restrictive trade regimes.
Pasha was sharing the outcome of the research with a select group of journalists.
The findings of the think tank make a strong case for trade normalisation with arch-rival India despite recent escalation of tensions following violation of ceasefire at the Line of Control.
Pasha was of the view that trade normalisation, commonly known as granting the Most Favoured Nation (MFN) status to India, will also help reduce inflation on the back of availability of comparatively cheap Indian goods. He said over a period of three years the country will achieve $700 million in annual gains besides creating 200,000 new jobs.
In comparison with Pakistan, India will gain 0.5% of its gross domestic product (GDP).
“The government should go ahead with MFN, but should get meaningful concessions while negotiating further reductions in sensitive list maintained by India under South Asia Free Trade Agreement,” said Pasha while sharing the crux of the findings.
In February last year, Pakistan had abolished positive list containing only 1,956 items or 27% of the allowed tariff lines with 1,209 non-importable negative list, only 18% of tariff lines. The government has not met its commitment of abolishing the negative list by the end of December 2012, citing ‘concerns’ over the grant of MFN.
Pasha said as Pakistan has already opened up 82% of its tariff lines for Indian goods from just 27% before February 2012, there was no rational in reversing the decision on the grant of MFN. “Jumping from 27% to 82% was probably a very big move,” he remarked.
He said Indians have cleverly negotiated the reduction of Safta sensitive list by linking the reduction with the number of items instead of the extent of liberalisation. He suggested that the negotiators have been trapped in the number of tariff lines and they should focus on the extent of liberalisation aimed at maximising gains.
He said as a result of MFN overall Pakistan’s exports will get benefits on 64% of tariff lines, but in return the country is giving up on 90% of tariff lines.
Agriculture
Pasha was of the view that Pakistan has given up maximum in the area of agriculture. As a result of abolishing the positive list, it has opened up 92% of its agriculture sector to Indian goods.
In comparison, India is still protecting its agriculture through very high customs duties besides placing many products in the sensitive list of Safta. Still wheat, rice and mango are on the sensitive list, in addition to 100% duty on wheat, 70-80% duty on rice and over 30% duty on vegetables and fruits.
According to the research, there was clear asymmetry in Pakistan and Indian agricultural sectors. India
was subsidising its agriculture to the tune of 5% of GDP compared to subsidies equal to just 1.2% of GDP in Pakistan.
Pasha said under Safta 97% of Pakistan’s agriculture sector is open for Indian goods as compared to only 43% access granted by India.
The think tank suggests that the government should protect the agriculture sector by using the Safta platform.
Industry
The study finds that Pakistan’s industry is still heavily protected under the negative list and Safta sensitive list. It suggests that the government should drop many textile items that have been protected through sensitive and negative lists despite having comparative edge over Indian goods.
Instead, Pakistan should add most vulnerable goods like iron and ore, steel, pharmaceutical and engineering goods.

Study findings: Trade with India will augment national wealth – The Express Tribune

**Toramana** · 01-11-2013, 10:48 PM

ISLAMABAD: The Foreign Ministry on Thursday clarified that comments by the foreign secretary on granting India most favoured nation status had been reported out of context.
In a statement, the foreign ministry spokesperson said that the Secretary had pointed towards the reservations express by some stakeholders.
Spokesperson said that Pakistan government is committed to implement its decision to establish normal trade relations with India.

Foreign Ministry clarifies secretary’s remarks on MFN status – The Express Tribune

**Toramana** · 01-11-2013, 10:51 PM

LAHORE: Warid Telecom launched two interactive mobile apps for its customers. The launch of ‘PakWheels’ and ‘Hari Bati’ is a key step by Warid Telecom towards service innovation. Warid has joined hands with PakWheels.com to bring car buying and selling on all Android mobile phones with compatible versions. The application is an online automobile market where customers can buy and sell cars and view price information of popular car models in Pakistan. On the other hand, Hari Bati (green light) app has the ability to show street traffic on a map-based interface. Allowing users to mark frequently visited routes and receive constant updates regarding the traffic situation directly on their handsets. Both applications are free to download. Applications are only downloadable through a Warid GPRS connection. Warid Chief Commercial Officer Younas Iqbal Sheikh said, “These two apps are the start of a series of similar launches on the Warid network that will enable our subscribers to make the best use of the latest technology.”

Smartphone proliferation: Warid launches interactive apps – The Express Tribune

**Toramana** · 01-11-2013, 10:56 PM

ISLAMABAD:
Though India has not been granted the Most Favoured Nation (MFN) status, Pakistan has already liberalised 97% of trade with the neighbour, reveals a study conducted with technical assistance of the US Agency for International Development (USAID).
The study was submitted and discussed in a meeting held here on Thursday, where officials of the commerce ministry and Prime Minister’s Secretariat, representatives of the agriculture sector and other stakeholders were present.
The study came quite late as the commerce ministry should have conducted research on the impact of liberalising trade before taking decision on the grant of MFN status to Delhi.
The study, conducted by economist Hafiz Pasha, endorsed the concerns raised by different stakeholders including the textile, industrial and agriculture sectors, a government official commented.
Indian trade regime is more restricted for Pakistani exports and on the contrary Pakistan has given much more access to Indian export goods.
“India has liberalised only 43% of trade for Pakistani goods and our major exports are not being given preferential treatment,” said Pasha in the study.
The study recommended that Pakistan should not at all discontinue its negative trade list that would serve as a shield for the local industry and agriculture.

Despite MFN delay: Pakistan removes almost all trade curbs – The Express Tribune

**Toramana** · 01-11-2013, 10:59 PM

NEW DEHLI:
Even as Pakistan’s cabinet mulls over whether to grant the Most Favoured Nation (MFN) status to India or not, figures released in a study by an Indian commercial organisation suggest that trade has grown exponentially regardless of the bureaucratic hurdles in formalising economic ties.
Indo-Pak trade through the Attari border in Punjab has witnessed a quantum leap in the first nine months (April-December) of the current (Indian) fiscal year, compared to the corresponding period of last year, despite Islamabad’s restriction that allows the import of only 137 items through this dry port.
During the period, India’s imports grew by 93%, while exports witnessed growth of 73.5% over the corresponding period of the last fiscal year. Despite the significant growth in imports as compared to exports, the balance of trade is still in India’s favour.
According to data collected by the Associated Chamber of Commerce (ASSOCHAM), India’s total imports from Pakistan during the first nine months of the current fiscal year – ie April 2012-December 2012 – stood at $238 million, as compared to $123 million in the corresponding period of the preceding fiscal year. Similarly, exports touched $316.28 million during the nine months of the period under review, while they stood at $182.27 million in the corresponding period of the previous fiscal year.

Traders say the inauguration of the Integrated Check Post (ICP) at the Attari border in Amritsar (Indian Punjab) on April 13 last year, to facilitate trade between India and Pakistan, is one reason behind the increase in the trade volume. With the commencement of the new ICP, the infrastructure set up can handle ten times the number of trucks that pass through it to move on either side of the border, as against only 100-150 trucks earlier. During the period reviewed, about 51,000 trucks passed through the border to either country.
But though traders dealing with imports and exports to and from Pakistan are upbeat about the ICP project, they do want Pakistan to grant the MFN status to India as soon as possible. They also hope that the list of items allowed to be traded through this route will be extended, as Pakistan has still not allowed the free trade of items across the Attari-Wagah border despite it being the cheapest and shortest trade route.
In March last year, Pakistan notified its negative list for India: which means that, barring 1,209 items, India can now export all products to Pakistan. However, Islamabad has allowed the import of only 137 items through the Attari land route, instead of the nearly 2,000 items which were allowed earlier under the positive list. Traders believe that trade will swell further if Pakistan allows the entire list of about 7,500 items that can be imported from the Indian side through the Attari crossing.
According to the ASSOCHAM study, the opening of the ICP and Pakistan’s granting MFN status to India can increase bilateral trade to $8 billion a year in the next two years, from the current level of $2.6 billion.

Buildup to MFN: Indo-Pak trade through Attari on the upswing – The Express Tribune

Announcement

Economy: Pakistan

Economy: Pakistan

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