Pakistan Daily Economy Update - 31 January

Transcription

1. Jan . 31, 2017 KCCI - eBulletin Nepra forms committee to probe ‘excessive collection’ by KE NEPRA has constituted a high-level fact-finding committee to examine allegations by the Ministry of Water and Power that Karachiites had been overcharged to the extent of PKR 62Bn by K-Electric over the past few years. The committee is required to submit a report within a week. The tariffs charged by the KE used to be approved by the regulator under a multi-year tariff mechanism. The regulator has declined to publicly comment on the power ministry’s issue. The K-Electric, on the other hand, has rejected outright the claims of excessive collection and labelled them as wrong interpretation of the tariff mechanism. Dawn. KE resumes loadshedding in industrial areas Industrialists have criticized K-Electric for resuming load shedding in city’s industrial areas due to low gas pressure. They urged the federal government to take notice of power load shedding in industrial areas. Dawn. SAARC chamber asks govts to work on visa-free region In a meeting with Finance Minister Ishaq Dar, SAARC Chamber of Commerce and Industry President Suraj Vaidya and Vice President Iftikhar Malik have said that all the governments of the regional countries should work on a visa-free South Asia as the SAARC can help promote political cooperation and serve as a forum for communication to diffuse the regional tension. The Nation. PM’s package does not cover non-textile sectors Prime Minister's PKR 180Bn exports revival package does not cover non-textile sectors i.e. surgical, sports, leather and carpets creating ambiguities among exporters. In this regard, Textile Industry Ministry has allowed duty drawback only on garments, home textiles, processed fabric, greige fabric and yarn manufactures cum-export units; on or after Jan. 16, 2017. Similarly, through SRO 36(1)/2017, FBR has exempted sales tax on machinery import (not manufactured locally) by textile industrial units from Jan. 16, 2017 till Jun. 30, 2018. For other sectors, Commerce Ministry is yet to issue a notification. In this regard, garments manufacturers & exporters have said that it is difficult to show exports growth during next six months period as it would take time to avail the actual incentives announced by the govt. BR. Services trade deficit up by 34% on absence of CSF inflows The country's services trade swelled by 34%, posting a deficit of $ 1.71Bn during 1HFY17 compared to $ 1.28Bn in the same period of FY16. During the period under review, Pakistan services’ export fell by 12% to $ 2.54Bn against $ 2.90Bn in the corresponding period of last fiscal year. The services’ import rose by 2% to reach $ 4.24Bn in July-Dec.16 against $ 4.17Bn in the same period of FY16. BR. Kapco sell-off plan faces delay The prospect of Kot Addu Power Company (Kapco) privatisation faces delay as issues of required comfort letter for the Power Purchase Agreement (PPA) extension have remain unsettled. The Cabinet Committee on Privatisation (CCoP) has directed the Water and Power Ministry to provide a comfort letter to Privatisation Commission (PC) that the Kapco power plant will remain operational beyond 2021 and till the operational life of the plant, its generation licence and PPA will be renewed. BR. World Bank to sponsor tourism projects in Pakistan The World Bank (WB) has pledged its support to the Pakistan Tourism Development Corporation (PTDC). The bank is committed to developing tourist facilities and resorts in the country by sponsoring different projects. The planned projects include a bus terminal at Nankana Sahib, one motel each at Hawks Bay (Karachi), Moenjodaro and Baran Kalay as well as tourist facilitation centres in Karachi, Lahore, Islamabad, Muzaffarabad, Gilgit, Peshawar and Quetta. Tribune. Consumer loans soar threefold to PKR 46.1Bn in July-Dec According to the SBP, banks’ consumer loans soared more than 3 times to PKR 46.1Bn in 1HFY17 as decades-low interest rate piqued people interest in low-cost funds to own automobiles and houses. Consumer loans rose exactly 365% over PKR 9.9Bn released under the same portfolio in the corresponding period of 1HFY16. The News. Realtors demand end to anomalies in property rates Real estate agents have claimed existence of a number of anomalies in the market property rates and the ones issued by the FBR. They claim that in one of many cases DHA City Karachi is using the FBR valuation whereas private housing schemes are using the paid instalment amount for the valuation and tax computation. This causes a big difference in transaction costs. Dawn. Cotton production to fall further, warns ministry The Ministry of Textile Industry has predicted decline in cotton production to accelerate. The warning has come at a time when the federal government is considering allowing the import of cotton to bridge the shortfall in local production. Cotton acreage has already shrunk by 22% over the last 10 years. Official data shows the acreage of maize increased 24%, rice 7% and sugarcane 14% from 2005-06 to 2016-17, mainly because of reduction in cotton area. Dawn. Rupee rises against major currencies, except dollar The rupee has been appreciating against all major international currencies, except the dollar, making it harder for exporters to keep their products globally competitive. Pakistan’s exports have been declining for the last three years as exporters claim the high cost of production has rendered their products uncompetitive. Dawn. Date / Period Unit Value Change Daily USD-Interbank 30-Jan PKR 104.84 -0.02% USD-Open MKT 30-Jan PKR 105.00 -2.37% KSE-100 index FIPI 30-Jan Pts. $ Mn 48,972 -4.64 -1.98% NM** -2.14% Crude (MA'17) 30-Jan 30-Jan $/bbl 52.69 Gold (FE'17) 30-Jan $/oz 1,197 0.52% Gold (10g) Local 30-Jan PKR 42,728 -1.29% Silver (FE'17) 30-Jan $/oz 17.14 1.88% Cotton(KHI)-40 kg 30-Jan PKR 7,218 0.00% Kibor-6M 30-Jan % 6.11% -0.01% Forex Reserves 20-Jan $ Bn 23.25 WoW 0.24% Remittances Jul-Dec 16 $ Bn 9.46 -2.27% Exports* Jul-Dec 16 $ Bn 9.91 -3.82% Imports* Jul-Dec 16 $ Bn 24.40 10.10% Trade Balance* Jul-Dec 16 $ Bn -14.49 -22.20% Current Account Avg. CPI-FY17* Jul-Dec 16 $ Mn % -3,585 3.88 -92.23% YoY Jul-Dec 16 Jan-17 Discount Rate % 5.75 Sources: KCCI Research, PMEX , NCCPL, KSE, SBP, PBS* ** Not Meaningful WoW= week on week; YoY=Year on Year Major Currencies 175 165 155 145 GBP, 30-Jan-17, 131.2 135 125 115 EUR, 30-Jan-17, 112.0 USD, 30-Jan-17, 104.7 105 95 85 75 Jan-16 Apr-16 USD GBP Jul-16 EUR Oct-16 Source: KCCI Research ; Oanda.com Quote of the Day "If you stay true to yourself and true to your vision and your own values, you can power through and make an impact on modern life. " stephen bannon Chart of the Day 13 Central Bank's Discount Rate (Jan.'12-Jan.'17) 12 11 10 9 8 7 6 5 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Regulator advocates steep hike in fuel rates Based on existing tax rates, OGRA has worked out substantial increase in the prices of all the petroleum products effective from 1st Feb‘17 for the next 15 days. In a summary sent to the government, Ogra recommended 6.11% increase in the price of petrol, 5.55% in HSD, 38.63% in kerosene, about 29% in light diesel oil and more than 17% in the price of HOBC. Dawn. Economic Indicators List of Indicators Small farmers feel left out Prime Minister's Kissan Package has failed to benefit small farmers as the govt. has released only PKR 25Bn out of the envisaged PKR 40Bn cash assistance while progress on other aspects also remained slow. The package envisaged a direct Source: KCCI Research; SBP Discount Rate (%) benefit of PKR 147Bn to small farmers across the country and PKR 194Bn through easy loans to the agriculture sector. Similarly, no progress has been observed on the interest-free loans promised to the farmers of 12 acres or less for the installation of Disclaimer solar tube-wells. BR. 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 Atlas Honda’s profit up 32% to PKR 1Bn verified. Atlas Honda Limited has posted a net profit of PKR 1Bn (EPS: PKR 9.68) in 1QFY17, up 32% compared to PKR 755Mn (EPS: PKR icon represents the sole viewpoint of the KCCI R&D Cell, and is stated to enrich the readers' 7.30) in 1QFY16. Tribune. understanding of the news item. The R&D Dept. bears no responsibility for its correctness or accuracy. Contact: res@kcci.com.pk