Pakistan Daily Economy Update - 30 October

Transcription

1. Oct . 29-30, 2017 KCCI - eBulletin Duties, taxes on imported vehicles: PM urged to suspend amendment In light of the misuse of car import schemes, a few days ago the Commerce Ministry issued SRO 1067(I)2017, an amendment to IPO 2016, that states that all duties and taxes on imported vehicles in new or used conditions either under personal baggage or gift scheme will be paid out of foreign exchange arranged by Pakistani nationals themselves. Under this SRO, it would now be impossible to arrange transfer of foreign currency through "hawala/hundi" in the name of Pakistani National in whose name the vehicle has been imported or to buy dollar from open market and thereafter to obtain bank encashment certificate for payment of duty and taxes. Auto dealers have urged the Prime Minister to suspend the SRO claiming it would only cause unrest in trade. BR – Mon. POL prices might go up by PKR 1 to PKR 2 per litre Rising crude oil price in global markets might prompt the govt. to increase prices of domestic petroleum products by Re 1 to PKR 2.50 per liter from Nov. 1, 2017. The govt. might consider some upward revision in the domestic petroleum prices. The OGRA would prepare the summary of oil products on Oct. 30, 2017 which would be sent to Ministry of Petroleum and Ministry of Finance. The Nation – Sun. Govt plans changes in tax law to check outward remittances Government has planned to bring changes in income tax laws to check growing capital outflows in an attempt to put the economy back on track. FBR, earlier this week, issued draft rules to amend section 43Bn of Income Tax Rules 2002 to monitor time period of tax actually deducted and paid by withholding agents. FBR has proposed new sub-rule in 43B which says that withholding agents should collect tax amount, seven day prior to plan remit of such amount abroad to non-residents through the central bank or any banking company. The News-Sun. SBP may step in as pressure continues on Pakistani rupee The SBP may intervene in the open currency market next week by releasing extra dollars to ease pressure on the rupee as demand for the greenback continues to surge in the wake of excessive buying. The expectation stemmed from the central bank’s recent assurance to currency dealers that it would provide dollars if and when needed in the open market. The gap between the demand and supply of dollars has narrowed to virtually zero in the open market. Tribune-Sun. Russia wants to lay gas pipeline from Iran to India, but via Gwadar Russia plans to export gas to Pakistan and India by laying an offshore pipeline, ignoring pressure from the US that has fiercely opposed the building of Iran-Pakistan (IP) gas pipeline for years. Russia holds huge gas deposits in Iran and has offered Pakistan and India gas exports by laying an offshore pipeline that will pass through Gwadar Port. It is even ready to finance feasibility study on viability of the offshore pipeline. Tribune-Sun. Chinese firm offers 2,000 electric buses for Karachi under $ 600Mn project Chinese company has offered an over $ 600Mn transport project involving over 2,000 electric buses to solve the issues being faced by the metropolis commuters. The offer was made to City Mayor Wasim Akhtar by representative of Chinese company Eco Bus. Company, has reportedly said that the company would also gift two such buses that would reach the city within two months. Dawn-Sun. CDWP sends wastewater treatment plans to ECNEC for approval The Central Development Working Party (CDWP) of Planning Division, after completing deliberations on combined effluent treatment plants (CETP) of six industrial estates in Karachi, have sent recommendations to ECNEC for final approval. From the total cost of PKR 11Bn, Ministry of Commerce under Export Development Fund will share 33%, while Sindh government would bear 67% under Provincial ADP. In addition to these CETPs, Karachi Port Trust (KPT) would also establish a plant near Mai Kolachi Road to treat more than 60 Mn gallon of sewage daily with KWSB. Introduction and operation of CETPs would help industrialists to run these plants and operational and maintenance cost would be paid by users and industries who would be charged by KWSB. Daily Times-Sun. Duty relief on solar LED lights: Government may take policy decision The govt. is likely to take policy decision to deal with the issue of customs duty exemption on the import of solar LED lights. It has been recommended that relief on sales tax for both the importers and local manufacturers should be given and 10% Custom Duty should be imposed on import of solar LED lights to give an edge to the local manufacturers. BR – Mon. India formally starts exports to Afghanistan via Chabahar India has formally started exports to Afghanistan via Chabahar port in Iran by flagging off the first shipment of 1.1Mn tons of wheat to Afghanistan on grant basis after Trilateral Agreement on Establishment of International Transport and Transit Corridor was signed during the visit of the India Prime Minister of to Iran in May 2016. The shipment is part of commitment made by the Indian govt. to supply wheat for Afghanistan. This is the first shipment that would be going to Afghanistan through the Chabahar port. Six more wheat shipments will be sent to Afghanistan over the next few months. BR – Mon. \ Pak-Tunisia PTA to unleash huge opportunities for trade In a meeting with Pakistan’s business community, Tunisian Ambassador Adel Elarbi, has said that Pakistan and Tunisia are likely to sign a preferential trade agreement (PTA) this year, which would unleash huge opportunities for improving bilateral trade between the two countries. He informed the meeting that Tunisia’s 80% trade is with EU and Pakistan can promote its exports to Africa and EU by enhancing cooperation with Tunisia. Tunisian government is encouraging foreign investors due to which many investors of China, Turkey, Iran and other countries had invested in Tunisia. The Nation – Sun. Economic Indicators List of Indicators Sick PIA to get PKR 13Bn bailout package The Government is set to allow another bailout package worth PKR 13Bn to embattled national flag carrier. Pakistan International Airlines (PIA) is a chronic recipient of bailouts and its current liabilities are estimated at over PKR 300Bn and most of them have contingent ramifications on the federal budget. Dawn-Sun. Construction cost to rise by 12-15% Increase in import duty by 20% coupled with 10-37% anti-dumping duties on sanitary wares and tiles will push up construction cost by 12-15% per square meter. The total duty and taxes on imports of these items have swelled to an all-time high of 135% from 83%. Tiles and sanitary wares could only meet local demand of 25-30% while the rest is met through imports. Dawn-Sun. PTA’s new plan could see smuggled, stolen mobile phones blocked in country The Pakistan Telecommunication Authority (PTA) will be launching a system whereby smuggled and stolen handsets would be blocked in the country. The mechanism called the Device Identification, Registration and Blocking System (DIRBS) will enable an individual to pair his or her device with the Computerised National Identity Card (CNIC), which would then become the phone’s identity. Any device with a fake IMEI number, which is the case with some smuggled or stolen phones, would not be registered with a cellular network, thereby disabling its use. Tribune-Sun. Real estate players whiten black money worth PKR 290Bn People have legalized over PKR 290Bn worth of black money in just three months by accepting the realty sector’s tax amnesty scheme in return for paying a paltry PKR 877 Mn in taxes, which raises questions over the government’s strategy to deal with tax evasion. More than half of these transactions were carried out in Karachi. About one-fourth of property transactions took place in Lahore and roughly one-third each in Islamabad and Hyderabad. Tribune-Sun. Unit Value Change Daily 27-Oct 27-Oct 27-Oct 27-Oct 27-Oct 27-Oct 27-Oct 27-Oct 27-Oct 27-Oct PKR PKR Pts. $ Mn $/bbl $/oz PKR $/oz PKR % 105.41 107.50 41,409 -5.20 54.07 1,274.1 45,300 16.85 6,752 6.17% -0.03% 0.09% 0.00% NM** 3.54% -0.16% -0.38% -0.41% 0.00% 0.00% WoW -0.75% YoY 1.05% 10.84% 22.19% -29.75% -117.29% 56.33% Crude (DE'17) Gold (DE'17) Gold (10g) Local Silver (DE'17) Cotton(KHI)-40 kg Kibor-6M Forex Reserves $ Bn 19.90 20-Oct FY18 Jul-Sep 17 Remittances $ Bn 4.79 Jul-Sep 17 Exports* $ Bn 5.17 Jul-Sep 17 Imports* $ Bn 14.26 Jul-Sep 17 Trade Balance* $ Bn -9.09 Jul-Sep 17 Current Account $ Mn -3,557 Foreign Direct Inv. $ Bn 0.66 Jul-Sep 17 Jul-Aug 17 LSM Growth* % 11.30 % 3.39 Jul-Sep 17 Avg. CPI Discount Rate % 5.75 Sep-17 WoW= week Sources: KCCI Research, PMEX , NCCPL, KSE, SBP, PBS* ** Not Meaningful on week; Major Currencies 155 GBP, 29-Oct-17, 138.5 145 135 125 EUR, 29-Oct-17, 122.5 115 105 95 Oct-16 USD Jan-17 GBP Apr-17 EUR USD, 29-Oct-17, 105.5 Jul-17 Oct-17 Source: KCCI Research ; Oanda.com Quote of the Day "Provision for others is a fundamental responsibility of human life." Woodrow Wilson Chart of the Day Pakistan, Canada await joint study to boost trade Pakistan is awaiting a go-ahead from Canada to conduct a joint study for removal for hindrances in promoting of bilateral trade. Pakistan has already handed over terms of reference (ToRs) for the establishment of this joint study to Canada in the second meeting of joint working group and is awaiting Canada’s response in this regard. Dawn-Sun. ADB approves $ 800Mn for CAREC road corridor in Pakistan The Asian Development Bank (ADB) has approved $ 800Mn Multi-Tranche Financing Facility for Central Asia Regional Economic Cooperation (CAREC) road corridor development in Pakistan. At the 16th CAREC ministerial conference held in Dushanbe, it was decided that ADB will finance the first phase of the Turkmenistan-Afghanistan-Pakistan (TAP) electricity transmission line project amounting to $ 150Mn next year. CAREC ministers from 11 member countries endorsed CAREC 2030, a new long-term strategy that will take the CAREC program to its third decade of operations. BR – Sun. Date / Period USD-Interbank USD-Open MKT KSE-100 index FIPI PAKISTAN'S NET FDI & REPATRIATION OF PROFIT ON FDI (1QFY11 - 1QFY18) 1QFY18 662 386 1QFY17 423 307 1QFY16 508 312 202 209 1QFY15 1QFY14 175 239 125 115 1QFY13 1QFY12 164 263 397 1QFY11 0 100 200 300 Net FDI 400 636 500 600 700 Repatriation on FDI Values in $ Mn Source: KCCI Research, SBP Disclaimer This report has been prepared by KCCI Research & Development Cell. The information contained herein have been compiled or arrived at based upon information obtained from sources believed to be reliable and in good faith. Such information has not been independently verified. icon represents the sole viewpoint of the KCCI R&D Cell, and is stated to enrich the readers' understanding of the news item. The R&D Dept. bears no responsibility for its correctness or accuracy. Contact: res@kcci.com.pk