Nationwide Updates

► TCP justifies scraping of sugar tenders

The Trading Corporation of Pakistan (TCP) said on Monday that sugar mills have quoted higher prices than wholesale market for sugar sale in response to its two tenders. In a clarification, the TCP said that majority of bidders had quoted same rates, indicating a sign of making cartel or grouping among themselves. It said that there was no justification in quoting higher prices than prevailing prices in the market in the tenders which were opened on April 28 and June 5, 2008, as they had sold sugar on lower rates in the market.  (Dawn)

► Power plant import: long-term financing allowed

The State Bank of Pakistan (SBP) has allowed import of power plant and machinery under 'Long Term Financing Facility (LTFF). This step has been taken on the request of exporters and industrialists to meet their power requirements due to continuing power shortage across the country. The SBP, with reference to LTFF Scheme MFD Circular No 07 dated December 31, 2007, has advised that from July 1, 2008 financing for import of generators and captive power plants, to be used in the eligible sectors and sub-sectors as per list given in Schedule 1 of LTFF Scheme, will also be admissible under the Scheme.  (Business Recorder)

► The budget for 2008-09 has failed to address the basic issues

Like other budgets before it, the budget announced on June 11 has sacrificed long-term goals for short-term expediencies. Over the years, it is this kind of short-sighted approach that has kept the country poverty-stricken. We abandoned the concept of five-year plans in the mid-1990s. We then came up with the concept of annual rolling plans, though it was never quite clear what the word ‘rolling’ meant in the context of this formulation. Could it be that this rolling plan concept had something to do with the adage that “a rolling stone gathers no moss”? And could it, then, further be that this was why the rolling plans never amounted to much?   (The News)

► Finance Bill 2008: Appalling, regressive taxation

Even a cursory reading of Finance Bill 2008 shows beyond any doubt that it is the handiwork of same old tax baboos of the Federal Board of Revenue, who have only one concern ie how to rob the poor and protect the wealthier sections of society. Tax proposals confirm criminal culpability between the ruling elite and tax collectors as unprecedented burden of taxes is imposed on the poor, whereas no progressive taxes are introduced to tax the rich and the mighty. It is tragic that the new elected government has placed total reliance of tax bureaucrats.  (Business Recorder)

► Waiting for the day

Economics is a complex subject. It is an abstract science with too many figures. The budget is a complicated document but no meaningful analysis of the budget and the state of country’s economy may be made without the use of figures.  There are 3 major parts of this article: 5 year economic performance of PML(Q). How did we end up with the current economic mess?  (III)The budget of the coalition government. Let us briefly go through how the economy performed in the 5 years of PML(Q) Government which ended on November 15, 2008. There are 6 major macroeconomic indicators to judge the economic performance.  (The News)

► Fortnightly oil pricing policy scrapped

 The government has scrapped the policy of fortnightly announcing oil prices and has barred the Oil and Gas Regulatory Authority (Ogra) from fixing the rates for consumers on first and 15th of each month. From July 1, 2008, any upward or downward revision in the oil prices would be made on as-and-when-needed basis. Ministry of Petroleum sources told Business Recorder on Tuesday that the decision of scrapping the policy of announcing the oil prices twice a month was taken at a meeting held last week. He said the Ministry has held a series of meetings with the stakeholders operating in the oil sector.  (Business Recorder)

► No payment of subsidies after June 30: SBP  

The State Bank of Pakistan officially announced on Tuesday that banks and authorised dealers would not receive Research and Development (R&D) subsidy claims of textile and other sectors after June 25, 2008 and instructed field offices not to make payment of subsidies after June 30, 2008. Sources said that this step has been taken in consultation with the Finance Division, as the ministry has not allocated any amount for R&D subsidies in next fiscal year. During FY08, the Finance Division allocated some Rs 19 billion for R&D support to textile sector.  (Business Recorder)

► SECP’s steps to keep real investors away from stock market: experts

The Securities and Exchange Commission of Pakistan and the Karachi Stock Exchange have taken force majeure steps to build investor confidence that was ruined by the sharp decline of the stock market. Only ‘few factors’ had disturbed market sentiments to an extent that indices crashed to 15-month low levels, market sources said. Apparently, the SECP has taken steps to ease selling pressure on bourses and build the confidence of investors. But, stock gurus say that in the long term these measures will make real investors avoid making fresh investments. The SECP has given safe exit to investors that were badly trapped in financial obligations in a falling market.  (The News)

► Wheat procurement target missed by one million tonnes

Despite using all administrative tools and other available means for procuring the targeted wheat quantity the government departments failed to produce the desired results. The wheat procuring agencies could only secure 3.9 million tonnes of grain falling short of over one million tonnes against the target of five million tonnes, reveals official data available with The News on Tuesday. The two provincial food departments and PASSCO could only procure 3.9 million tonnes of wheat against the target of five million tonnes whereas they had procured 4.399 million tonnes last year, the data compiled by MINFAL stated.   (The News)

► US House approves $150 million new assistance

The US House of Representatives has approved $150 million in new assistance for Pakistan to address economic needs in the next fiscal year. The assistance is included in the war supplemental budget measure into the year 2009, beginning from October 1, 2008. The $150 million will be in addition to allocations Pakistan will receive under regular budget for 2009. The US administration has already requested a total of $901 million for Pakistan in the year 2009. The Senate is going to take it up the measure shortly.The Senate is going to take it up the measure shortly.  (Business Recorder)