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IMF conditionalities will push policy rate even further

LAHORE, NOV 27 (DNA) — Renowned economist Faiz Ul Haq has said that International Monetary Fund (IMF) conditionalities will push policy rate even further – and, the same has nothing to do with the real-world implication of interest rate hikes vis-a-vis Pakistan.

Faiz Ul Haq added that in a country where only 7 percent of its business community takes loans from banking channels, raising interest rates is no more than a fallacy. We have come a long way on a burgeoning path of 7 percent to 16 percent policy rate progression over the course of the last one and a half years; however, we have only witnessed a persistent and no-end-in-sight increase in headline inflation and other indices, he added.

Senior Economist Faiz Ul Haq said that we are living in an almost quarter a century’s highest policy rate regime in the country despite witnessing one of the most devastating floods in recent human history – not only in Pakistan. I am startled at the fact that the world is willingly testifying on our economic losses and our damages are quantifiable; and yet, we have not been able to extract any concessions for our people from lenders, he added.

Faiz Ul Haq apprised that even on a textbook-level, the world is back to the practice of a  discounted policy rate as compared to inflationary pressures & their policy responses to the inflation trajectories and it is a norm again and, at instances, it is many fold.

Faiz Ul Haq has elaborated the real reasons behind the unabated inflationary pressures as the triple whammy of diverse factors: (i) uncontrolled rise of dollar – far above the real effective exchange rate (REER), i.e. the only point where the finance minister seems to have stood his ground so far (ii) supply-side disruptions of essential & staple foods basket, hoarding & profiteering, maladministration & non-existent planning for food security, lack of oversight and floods-induced annihilation of the produce (iii) price gouging in the capital markets by commercial banks; admitted by consecutive finance ministers & administrations. =DNA

Imran finally calls it a day; better late than never

Analysis

Ansar M Bhatti

PTI Chairman and former Prime Minister Imran Khan announced in his public gathering on November 26 that PTI members will be resigning from all assemblies contending that there was no point in remaining part of the system that according to him had failed to dispense justice to the people of Pakistan. Let me borrow few lines from my article that published in this newspaper on November 8, 2022 titled Imran Khan needs to rise to the occasion, which reads, ‘probably, he  (Imran) wants to make a point here that there is no reason in accepting the government if the chief executive has no powers. Here lies a contradiction between what he says and what he actually practices.

He had pointed out in his press conference that the actual authority in Punjab lied somewhere else. If it would be a matter of weak control or no authority at all, then the non registration of his FIR was a good excuse for him to call it a day in Punjab.

He would have got rid of the Punjab government soon after his own police refused to register his FIR. Ostensibly, his action would have earned him more respect and credibility’.

Now finally he has deiced to rise to the occasion by getting rid of the Punjab and KP governments albeit he has not announced yet as to when he actually plans to do it. During his speech Imran Khan said they will resign from the assemblies.

It is believed by the PTI leaders that when he said resignations he meant dissolution of assemblies, which makes sense because mere resignations won’t serve their purpose. The issue of their resignations from the National Assembly is still haunting them.

Even if the PTI wants to dissolve the KP and Punjab assemblies, it has to do it rather quickly for if a no-trust move is tabled against the respective chief ministers then it will not be able to dissolve the assembly till the time the no-trust move is decided.

The imposition of Governor’s Rule is yet another possibility. The government parties have also put their heads together to deal with the evolving situation because if the PTI dissolves KP and Punjab Assemblies and resigns from the Sindh and Balochistan assemblies then the Election Commission has to announce elections in more than 500 seats.

By- polls on about 115 national assembly seats are still pending. So in this case a fully-fledge election drill has to be carried out. The situation may force the government to call general elections. Therefore, in this backdrop, the PTI move appears to be very smart and perhaps even the government was not expecting this from the PTI chairman that he would resort to this course.

As I had mentioned in my earlier article published on November 25, 2022 titled ‘ Key appointments; all’s well that ends well”, that the PTI would like to mend fences with the new military leadership. The article reads, “One thing is for sure that the party has decided not to stage any sit-in Islamabad.

The senior party leaders said that the PTI leadership will now try to have some political dialogue in order to pave the way for the elections. The senior leaders also told me that the Saturday’s long march gathering may not turn into a dharna, as earlier announced by the party leadership. It will be just a procession where Imran Khan would deliver his speech and announce his future course of action. My understanding is that Imran Khan will move cautiously on this issue and may not take a hard line regarding these (military) appointments.

In his speech on November 26 he did not make any mention about the new military leadership. Even about the outgoing military leadership he chose his words carefully to delineate its role. But as regards the outgoing military leadership this is for sure he would take tough stance after November 29.  According to his critics, Imran Khan perhaps has realized that he cannot enter the power corridors without the support of the local as well as the international establishment.

 However, it still seems to be a daunting task for the PTI leadership It remains a fact that the present crisis can only be averted by forming a caretaker set at the first place and the ultimately holding of the general elections. The PML N, which is also the leading political party like PTI, probably cannot afford elections at this juncture when its popularity has severely been dented by the incumbency factor. Though, the PML N may not be responsible for the political and economic woes the country is facing right now, yet being the leading ally the entire focus has shifted towards it.

 Even it is in the interest of the party to go for early elections simply because the mess that has been created in past 7 or 8 months would only aggravate with the ach passing day. Nevertheless, the party would wait until its supremo Nawaz Sharif returns, who is likely to come back to Pakistan next month or maximum in January.

Analysts believe, once he returns, he is likely to get relief from the courts and thus become eligible to contest the next elections. In this case, everybody would have a level playing field.

Endnote: The US and Chinese governments have congratulated the newly-appointed military leadership and expressed hope to work closely with it. The Saudi government is yet to extend its greetings but I believe it will also do so as Pakistan and Saudi Arabia relationship has to move forward and strengthen.  It is in the interest of both peoples.

ICCI terms 100bps hike in SBP interest rate a big blow to businesses

Islamabad, NOV 27 /DNA/ – The Islamabad Chamber of Commerce and Industry has shown great concerns over the 100bps hike in the SPB key policy rate as it would play havoc with the cost of doing business and cause the closure of many industries leading to further slump in the already fragile economy.

Ahsan Zafar Bakhtawari, President, Islamabad Chamber of Commerce and Industry said that businesses were already struggling for survival due to multiple challenges including massive rupee-dollar fluctuation, hike in utility tariffs & POL Products and increasing energy shortages. In these difficult times, instead of taking measures to promote the ease of doing business, the government has made an unprecedented hike in the policy rate that would prove destructive for the business and economic activities. He said that on the one hand the government has announced to promote interest-free banking in the country and on the other hand, it is hiking interest rates, which is contradictory.

He said that the interest rate in Thailand is 1%, Taiwan 1.63%, Singapore 2.65%, Malaysia 2.75%, South Korea 3.65%, China 3.75%, Indonesia 5.25%, Bangladesh 5.75%, India 5.9%, Vietnam 6%, but in Pakistan it has been raised to 16%, cumulatively increasing it by 625bps in 2022. He said that due to the recent hike, the policy rate has jumped to a 24-year high level in the country as it was only in 1998 that the policy rate was over 16 percent.  He said that after adding Kibor, the policy rate would go up to 18.50 percent while after including bank profit and insurance it would go up to 22 percent. He said it would badly affect business and investment in the country as who will borrow at such high borrowing cost.  He stressed that the SBP should withdraw the recent hike in policy rate and bring it to single digit level to reduce production cost and improve the competitiveness of our exports.

Faad Waheed, Senior Vice President and Muhammad Azhar ul Islam Vice President ICCI said the SBP has further tightened the monetary policy on the plea to address the higher inflation and contain the risk to financial stability. However, they said that it would prove counterproductive as the manufacturers would pass on the burden of costly loans from the banks to the consumers by raising the prices of their products and the common man would face more inflation that would make his life miserable. They said that the business community is already in crisis due to gas shortages & load shedding while letters of credit are not opening. They urged that the SBP should review its decision and withdraw the hike in policy rate to save businesses from further troubles.

HEC Intervarsity Badminton Boys Championship at IoBM

ISLAMABAD, NOV 27 /DNA/ – Sports Officials attended the Manager’s meeting of the HEC Intervarsity Zone M Badminton Boys Championship 2022-23. It was held at the Institute of Business Management (IoBM), Karachi on Saturday, 26, 2022.

As many as 10 universities are participating in this tournament that begins on Monday, November 28, 2022, at IoBM. The draws for the tournament matches were held during the meeting.

IVWF, KBM Care join hands for humanitarian endeavors

ISLAMABAD, Nov 26 (DNA): In a land mark development a Memorandum of Understanding (MOU) between Inner Voice Welfare Foundation and KBM Care Foundation to jointly work in the field of education, health, emergency relief, women empowerment and youth development.

The MoU was signed at a ceremony held at IVWF office that was signed by Voice Chairman of KBM CARE Voice Chairman Mohammad Azmat Hanif and Inner Voice Secretary Ahmad Khan. The ceremony was witnessed by IVWF Chairperson Raheela Khan and KBM CARE Chairman Khalid bin Majeed.

Speaking on the occasion, IVWF Chairperson Raheela Khan said that the MoU aims at establish and serve as a joint platform for both organizations to coordinate, cooperate and jointly implement and resolve welfare programs as per respective primary objectives and expertise in education and health care, emergency relief, women empowerment and youth development.

She said that both organizations will execute their roles as implanting partners for respective projects on joint platform.

Speaking on the occasion, KBM CARE Chairman Khalid bin Majeed said that the aim of the MoU is to enhance cooperation between the two organizations and create an understanding how the global demographical social changes provoked by world-wide inflation flows affect changes in all issues related to education and health care.

The MoU aims to safeguard the confidentiality of any information or document Either organization at any time may request assistance from the other in the missions related to its operational activities, with a view to ensuring and facilitating as may be relevant collaboration between the organizations in the planning, implementation and evaluation stages of mutual projects.

Both the organization will be represented at sourced sessions of education, health care, and relevant opportunistic events where both will have equal say in prospective projects and opportunities with mutual terms.

Both organizations have agreed to designate the undersigned official representatives to for the implementation of this MOU. Execution of all matters will be governed and managed by the designated officials with final decisions finalized by the principal founders.

Punjab CM assures to clear newspaper dues

APNS Executive Committee members meet Ch. Pervez Elahi; APNS to meet PM over ads quantum and rate increase issues

Staff Report/DNA

LAHORE, NOV 27: Chaudahry Parvez Elahi Chief Minister Punjab has assured to clear the dues of newspapers in one month, implementation of 25% quota and release of colour ads to regional newspapers and review of Punjab advertising policy in consultation with APNS.

 He was speaking to a delegation of the All Pakistan Newspapers Society comprising President APNS Sarmad Ali, Mujeeb ur Rahman Shami, Jamil Ather, Naz Afreen Saigol, Shahab Zuberi, Khushnood Ali Khan, Umar Mujib Shami, Mumtaz Tahir, Awais  Khushnood, Mumtaz Ali Shah, S M Munir Jillani, Humayon Gulzar, Humayon Tariq, Sajjad Bukhari, Bilal Mahmood,

The Chief Minister was apprised about the problems and issues being faced by the newspaper industry in general and Punjab based publications in particular. Ch Parvez Elahi assured that his government appreciates the importance of print media and would address the problems of newspapers on top priority. He advised the DGPR Punjab to clear the outstanding dues of newspapers within one month. On request of APNS, the Chief Minister announced that henceforth 25% quota for regional newspapers will be implemented for all provincial government advertisements including colour ads.

He  was apprised on the concerns of APNS on Punjab’s advertising policy. Ch Parvez Elahi decided to form a committee of stakeholders comprising the representatives of the Information Department and  APNS to review the advertising policy and suggest changes in the policy.

Principal Secretary to CM Punjab Muhammad Khan Bhatti, secretary information Punjab Asif Bilal Lodhi and DGPR Punjab Afraz Ahmed were also present in the meeting.

Later the Executive Committee of the APNS held its meeting. The Executive Committee noted that the Federal   government despite its various assurances given to APNS have not been implemented to clear long outstanding dues of the print media. The federal government has also not announced an increase in the government advertisement rates and quantum as promised by the Prime Minister in his meeting with APNS and the Federal Information Minister in her interactions with the Society. It was agreed that the APNS will apprise the Prime Minister of this delay and request him to address the above problems faced by the newspaper industry.

The Executive Committee was also apprised that the KP government has not cleared the long outstanding dues of over Rs 1.5 billion relating to provincial government advertisements. It was decided that office bearers of APNS will take up the matter with the KP government on urgent basis.

Korean music night features Samulnori zonre of music

DNA

ISLAMABAD: Ambassador of Republic of Korea Suh Sangpayo hosted a grand Korean Music Night featuring Samulnori zonre of music. The artists presented a spell binding performance.

This was perhaps for the first time that this kind of music was introduced to Pakistani audiences that is why all and sundry enjoyed the performances and praised the great work exhibited by the artists.

Ambassador of Korea on the occasion in his brief remarks welcomed the guests and assured his embassy would continue to presenting such performances even in the coming days. The guests were also served with traditional Korean cuisines. 

Gen Sahir Shamshad assumes charge of CJCSC

DNA

RAWALPINDI, NOV 27: In an impressive ceremony held at Joint Staff Headquarters, Rawalpindi, General Sahir Shamshad Mirza, HI (M) assumed the appointment of Chairman Joint Chiefs of Staff Committee, today.

Besides large number of serving and retired officers from tri-services, the ceremony was attended by former Chairmen Joint Chiefs of Staff Committee.

A smartly turned out Joint Services guard presented salute as Chairman Joint Chiefs of Staff Committee arrived at the venue. General Sahir Shamshad Mirza, HI (M) reviewed the  guard of honour  and March  past .

Azerbaijan announces tax-free imports of rice from Pakistan

BAKU, NOV 26: In a bid to stimulate the growth of mutual trade between the two countries, Azerbaijan announced a five-year tax exemption on rice imports from Pakistan.

Addressing an international conference “Along the Middle Corridor: Geopolitics, Security and Economy” held at ADA University, Baku, the other day, Azerbaijan President Ilham Aliyev said that the decision was the outcome of his meetings with Prime Minister Shehbaz Sharif held in the last couple of months.

The president said during these meetings, they discussed the agenda of their bilateral relations.

The Azerbaijani president was responding to questions raised by Executive Director of Center for Global and Strategic Studies of Pakistan Khalid Taimur Akram, as a participant.

The president said he discussed with Pakistan’s prime minister, the prospects of further intensifying the bilateral economic and trade cooperation and the decision over special regulations for rice from Pakistan, was a reflection of that.

He said they had decided to take this step in order to stimulate the growth of mutual trade between the two countries.

“Why should we buy rice from some other place if we have high-quality rice in the brotherly country? So, that decision was clearly based on our brotherly relations,” the Azeri media quoted the president as saying.

Commenting further, the Azerbaijan president said that his country enjoyed excellent relations with Pakistan.

President Aliyev further said: “We are very grateful to Pakistan for the continuous support which the country demonstrates with respect to Azerbaijan-Armenia relations. 

“During the times of occupation, during the war, and after the liberation of our territories, Pakistan was always with us. And this political and moral support is highly appreciated by the people of Azerbaijan.”

He said that he knew that the Gwadar Port of Pakistan was transforming into a big international hub.

PM Shehbaz thanks Azerbaijan’s president

Reacting to the decision, PM Shehbaz thanked Azerbaijan’s president for the five-year tax exemption on the import of rice from Pakistan.

“Pakistan and Azerbaijan will work on boosting economic cooperation through rail and Gwadar port,” the prime minister says.

Poland near World Cup last 16 after stunning Saudi Arabia 2-0

AL RAYYAN: Poland bolstered their chances on Saturday of reaching the World Cup’s last 16 for the first time since 1986 after goals from Piotr Zielinski and Robert Lewandowski killed Saudi Arabia’s efforts to advance a game early.

Zielinski scored after 39 minutes against the run of play and Lewandowski put the match beyond Saudi Arabia eight minutes from time, while goalkeeper Wojciech Szczesny’s stunning double save from a penalty in first-half stoppage time kept Poland in the match against a Saudi side that was always on the attack.

The result leaves Poland needing only a point from their final Group C match against Argentina to guarantee their spot in the next round.

Saudi Arabia were the better team for the first half and had the advantage of a few favourable refereeing decisions but will rue the missed penalty from Salem Al-Dawsari, who scored the winner in their historic victory over Argentina on Tuesday.

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