Profit 31st January, 2012 by Profit Epaper

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Tuesday, 31 January, 2012

‘Corporate debt market in the offing’ banking supervision, he said.

KARACHI

JAVED MEHMOOD/ISMAIL DILAWAR

TaTE bank of Pakistan (SbP) and Securities and Exchange Commission of Pakistan (SECP) are finalising modalities to launch the long-awaited corporate debt market in the country. “I have started with the chairman SECP in a weekly meeting of Coordination Committee where we have been able to work on the launching of the corporate debt market so to develop corporate debt market,” said Governor SbP Yasin anwar in an exclusive interview with Profit. The complete interview will be published in Monday’s issue of Pakistan Today. “You have the ICI, Glaxo and others to tap the market themselves as opposed to going to the banks, which have captive audience. They can charge this KIbOR plus or whatever it is,” SbP Governor further explained the corporate debt plan. The investor from corporate sector would be able to go to the market themselves and fund their own portfolios. They don’t need to depend on banks anymore,” SbP Governor added. Once it happens, these banks would have to find new products and would go to SMEs that would automatically generate and increase economic activity thus growth in the country, he said. The banks’ extra liquidity would then be directed to the agriculture and house financing sectors, he said, adding the country’s legal system and the laws pertaining to financing sector had also got problems. and within next one or two years the corporate debt market and legal process were going to get into conversion of this areas into more robust lending ensuring the realisation of the engine of growth for this country. anwar, an optimist who sees the glass half full, views housing finance, Small and Medium Enterprises and agriculture as the three pillars of engine of growth in Pakistan. Terming the “documentation and technology” as two prerequisites for the SME lending, the governor said agriculture in Pakistan, representing 45 per cent of the work force and 21 per cent of GDP, has a huge untapped potential. about house finance, he illustrated that the outstanding loans to housing finance in Pakistan stood at only one per cent of the GDP compared to 65-70 per cent and 110 per cent, respectively, in the uS and the uK. Reasons being the fixed income market does not exist in Pakistan to provide that 25 to 30-year money.

EXAGGERATING LAW AND ORDER IN PAKISTAN “We have a difficult environment as it is in the world media where the media projects us as a nation that is fraught with a terror and law and order crisis, but that’s an exaggeration. We know that the foreign media is elevating this to a level which is unjustifiable,” he said. SbP Governor said life was very normal in Pakistan except some urban centers or the north-western parts of the country that were plagued and pockets of disturbances were there, which was a common phenomenon in many urban cities around the world. So it’s not alien and the business environment has huge potential, the banking sector is very resilient we are not faced with the crisis that is being faced by many other countries around the world and that is because of a sound

PRESENT STATE OF ECONOMY “I see going forward in terms of the dark clouds and the silver linings that we have in these dark clouds also. I am an optimist and see the glass half full, and that’s the only way I feel we should go forward to build bridges and cover up those potholes or those bumps that we see on the road ahead,” he further explained. now currently we have GDP at 3.8 per cent which is considerably better than what it was 2.4 per cent last year and naturally it is not as high as we would like to see, but we headed in the right direction, Yaseen anwar said. He said: “as far as our concerns or the challenges we have, is that we have a current account deficit that is a concern and I am not comfortable with it. We had a surprisingly small current account surplus last year that was because of fortunately very good prices of cotton which have picked up our exports but what it has dropped very quickly because the prices of cotton declined much faster than anybody had expected. We were not expecting it to get to this level so quickly, naturally, what does that do is to create an impact on our balance of payments, our reserves because that shortfall has to be met somewhere.” If you don’t get the inflows in, so that is where my second concern is. The inflows that we expect must be realized in order to reach our targets by the end of the year. We still have five-six months left so and I don’t want to predict that we will or will not reach it, that is challenging and the targets and those inflows are relating to Coalition Support Fund (CSF), 3G license to PTCL and of course the remittances and the latter one has been very steady as you know we have averaged to get about a billion dollars a month. During first half it’s little over $6 billion marking an 18 per cent increase during six months, july-December FY2012. That has been very healthy.

exchange companies that were shut down [Zarco and K&K (Khanani and Kalia)] if we assume that the pool of both formal and informal flows of remittances amount to, let’s say hypothetically I am just choosing the number, $20 to $25 billion. at that time we had inflows of $67 billion so by logic the rest of it would be informal sector right. On january 1, I issued a circular to all the exchange companies and banks that any exchange company that is operating with its counter party in overseas that counter party must be regulated by the local regulatory body or agency like State bank or its counterpart over there in England, uaE etc. That was a major restriction or condition that we put on. Thirdly, we launched what called the Real Time Gross Settlement (RTGS); a software program that in fact I was asked to set it up as I had an experience of the uS payment systems so it is something that I had to get an approval from Islamabad. Deeming the payment business a very important segment of an economy, we launched RTGS that allows us to transfer a $100 from new York to Muzaffarabad in a matter of few minutes to the beneficiary’s account. So the launch if this allowed the smooth flow and efficient transfer which could compete effectively the quick transfer of hawala or the informal trade business. So now the beneficiary’s account gets the money quickly. Fourthly, I instructed my inspectors to elevate their inspec-

MYSTERY OF THE INCREASING REMITTANCES and some people talk about a mystery. They wonder why the remittances have been going up over last three years. So I said this before and I said this in front of Finance Committee when I was asked. If anybody was in international banking and know international money transfer business then this word mystery would never be used as that means it’s not understood. Very simple, in january 2008 there were two

tion of the exchange companies to make sure that the compliances are being followed. The combination of these steps what it did is very simple forced an undisciplined environment into a more disciplined flow of the moneys coming from both the informal and formal channels. That’s why it’s now $12 billion target and we would meet it I think. Plus we also have created incentive mechanism that encourages those money changers abroad to send it through formal channels, so we give rebate under the incentive formula. So that is where we get $12 billion out of that 20 billion it means the pool may be the same for argument’s sake.

UNCERTAIN FLOW OF FOREIGN FINANCING On uncertainties on CSF and 3G license, I don’t want to say for sure that these will or will not come in on the CSF and others the federal government is optimistic and I have to support that optimism but at the same time one has to be realistic as well. Given the current environment I am a conservative banker so you have to hedge and supposing you do a sensitively analysis you go through the worst case scenario to be prepared so you have to ratchet up another side of the equation to make sure you try and balance that fiscal deficit.

THREE MAJOR ECONOMIC CHALLENGES Three major challenges we have, one, is the revenue side that is a key, secondly it’s the balance of payments, and third private sector credit. The fiscal revenue target is Rs1952 billion, attached to GDP ratio of nine per cent we need to be somewhere up north of that. Our expenditures are still naturally going up with the revenue side needs to go up expediential higher than what it has been. now if the inflows don’t come in, let’s say hypothetically, by 50 per cent say only $400 million come of the $800 million from the Coalition Support, we have got payments of the IMF $1.2 or $ 1.3 billion has to go out during this second half keep in mind it is not next month, people keep saying its next month it is in second sometime, I believe, in april or May. “but we have already budgeted that in our calculations, so we don’t see an impact of that as far as our forecast is concerned for fiscal deficit and the current account position,” as far as other inflows are concerned, if they don’t come in at the levels that were talking about the yes we will be hit on our reserves position,” The governor, however, refrained from giving a number indicating towards the level of fiscal imbalances.

Punjab Agri Dept forecasts ‘historic cotton production’ LAHORE

IMRAN ADNAN

unjab agriculture Department has estimated historic cotton production in the province due to favourable weather conditions, less pest attack and comprehensive extension services. Provincial agriculture Department has started preparation for the next season by initiating cotton training programme, which would be completed by February 15, 2012. The training programme would focus on good

farming practices and trained extension workers would assist farmers in preparing their fields for the next crop. agriculture Department’s field force would ensure proper uprooting of cotton sticks from fields, their disposal and grazing by sheep and goats as per provisions of the Pest Ordinance, 1959. Ploughing up of un-ploughed cotton fields and turn all cotton fields exposed to sunlight. Punjab agriculture Department has advised extension workers to ensure complete eradication of weeds through cultural, mechanical and chemical means. Pest

scouting of all spring crops, especially sunflower, shall be conducted with use of chemical sprays through insect growth regulators. White-flies will be targeted on alternative spring crops and weeds to avoid their further spread to upcoming cotton crop. Field workers will ensure proper adoption of sanitary measures in trees and shrubs around cotton fields and ornamental plant nurseries against whitefly and mealy bug. Remove or manage alternative host plants for CLCV, white-fly and mealy bug around prospective cotton fields.

They will ask farmers to start planning about the upcoming crop by earmarking the land for cotton, soil analysis, arrangement of good quality labelled seed through a reliable source, arrangement of machinery and credit. avoid water stress and excessive nitrogen to the plants to spring crop and in case of severe attack of white-ﬂy and mealy bug treat the plants with one of the recommended pesticides. use of Chrysoperla cards as biological control agents at the rate of 80-90 cards per acre with 20-25 eggs in each card may be advocated. These

cards are available at biological Control Laboratories at Vehari, Sahiwal, Pakpattan, Okara, Faisalabad and Toba Tek Singh. Speaking to Profit, agriculture Department Director General (Extension) Dr anjum ali said that the unprecedented increase in cotton production had also raised the bar to challenge field functionaries to deliver to their best for the success of upcoming crop. He appreciated the untiring efforts of the field staff for the success of current cotton crop and asked them to deliver their best in the forthcoming season.

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Tuesday, 31 January, 2012

news

Circular debt enlarges debt stock by Rs572 billion KARACHI

JAVED MAHMOOD

ETTLEMEnT of circular debt of power sector PSEs and public procurement agencies resulted in a substantial Rs572.2 billion increase in the stock of total debt & liabilities (TDL), during the first five months of FY12. With the addition of circular debt, the quantum of total debt had mounted to Rs12.7 trillion. However, after adjusting for this one-off factor, the increment in TDL stock shows a lesser magnitude during jul-nov FY12 as compared to the same period last year. Furthermore, as external inflows tapered, the pressure of financing the fiscal deficit has fallen on domestic banking and non-banking sources. While this trend may bode well in terms of external indebtedness, it has adverse implications for the private sector. Moreover, declining foreign inflows is also putting pressure on Pakistan’s FX reserves to finance current account deficit. State bank of Pakistan had mentioned these developments in its first quarterly report for FY12. GOVT DOMESTIC DEBT: The ris-

ing borrowing needs of the government were largely met from the banking system through short term floating debt instruments. This resulted in further amplification of scheduled banks holding of domestic debt to 37.7 per cent on end-nov 2011 from 33.4 per cent on end-jun 2011. FLOATING DEBT: MTbs held by scheduled banks were one of the chief sources of financing the circular debt settlement in november 2011. Specifically, government raised around Rs200 billion from 12-M MTbs in the auction held on november 4, 2011. On the upside, the maturity profile of floating debt has seen an improvement, after the monetary policy loosening by SbP in jul and Oct 2011. This is, due to a shift in commercial banks investment towards 12M T-bills instead of the shorter tenor bills. This shift towards longer tenor securities will reduce the roll-over and interest rate risk faced by the government. Furthermore, as a result of the SbPs efforts to diversify investors, the amount raised though the non-bank sector in MTbs auctions has also increased sharply. Encouragingly, the stock of government debt held by SbP registered

Rs 45 billion reduction during julnov FY12 over the end jun 2011 position. as the government is trying to keep additional budgetary borrowing from SbP at zero level, Rs 103.5 billion were retired to SbP during Q1FY12. However, it had to resume borrowing from SbP in Oct 2011 as the cut in policy rate and the resultant fall in MTb yields has dented scheduled banks incentives for investing in government paper. Resultantly, government had to borrow from SbP to settle the maturing amount. PERMANENT DEBT: The inflows through permanent debt continued the rising trend witnessed since Q2-FY11. Specifically, in the auctions held during Q1-FY12, Rs 52.2 billion were raised through PIbs, against a target of Rs 50 billion. However, permanent debt stock recorded a surge in nov 2011, as the government raised a hefty amount of Rs 195.0 billion for the circular debt settlement through 5-year PIbs. UNFUNDED DEBT: The inflows into nSS instruments recorded a healthy 20.1 per cent increase in jul-nov FY12 over the same period last year. an analysis of monthly inflows shows that the downward revision in nSS rates (in Oct

2011) has not, so far, discouraged investment in these instruments. EXTERNAL DEBT: Pakistan’s external debt stock fell by $255 million on end-nov 2011, from its june 2011 position, as compared to the hefty increase witnessed during the same period last year. However, after the suspension of the IMF program in FY11, the weakening of external loan inflows was anticipated. The early suspension of the IMF program sent negative signals about country’s macro-economy to other IFIs, which has halted their pipeline assistance. GOING FORWARD: With the risks mentioned to fiscal outlook above and weakening of external inflows, the stock of domestic debt is likely to continue the rising trend. as regards the servicing of debt, although the cut in policy rate has reduced the cost of borrowing, these gains are likely to be partially offset by the adverse movement in the Pak Rupee with rise in Rupee cost of external debt servicing. Thus, in overall terms, debt servicing as a share of government’s revenues, which already stood at 43.3 perc ent in FY11, is likely to increase further going forward.

Punjab to miss 539,000t gram production target

Targeting entire Pharma sector unfair: PPMA

SBP, ICIEC sign MoU to promote trade, investment

LAHORE

KARACHI

IMRAN ADNAN

STAFF REPORT

unjab is likely to miss gram production target of 539,000 tonnes set for the current Rabi season as it is facing severe threat due to negligible rain received by the barani areas, where it is mostly sown in the province. Speaking to Profit, a senior official in the Punjab agriculture Department said that the crop had been sown over an area of 2,370,000 acres of land in the province. It is mostly sown in barani area falling in districts of Mianwali, Khushab, bhakkar, Layyah, jhang and Muzaffargary. Last year, this crop had been sown on an area of 2,400,000 acres in the province and area under this crop had slightly decreased this year. However, sources in the agriculture department said this decrease is not that important as farmers do make changes in their sowing pattern every year. but, the important thing is that now when the crop is in critical stage of growth, its growth is badly hampering due to less rain fall this year. The sources said that the gram crop direly need two to three good spell of rains in which these areas should receive seven to eight millimetre of water to keep the prospects of a good crop and meeting the production target alive.

aKISTan Pharmaceutical Manufacturers’ association (PPMa) is shocked by the deaths that have occurred in the Punjab Institute of Cardiology (PIC) and express its heartfelt sympathies to the bereaved families. “at the same time we are seriously concerned that the entire blame for this tragedy has been passed on not only the six manufacturers who supplied the medicines, but also to the entire pharma industry. Three CEOs of our member companies have been arrested by FIa, even before the samples could be tested. This is unfortunate, as they have prosecuted even before the result of the testing labs,” asad Khuwaja, Chairman PPMa said while addressing a press conference at Karachi Press Club on Monday. according to him PPMa member companies manufacture quality medicines which conform to the laid down procedures under cGMP and quality control/quality assurance parameters. The license of which are granted by the competent drugs control authority is granted only when the manufacturer has complied with all the regulatory and quality control/ assurance requirements as per the Drugs act 1976.

TaTE bank of Pakistan (SbP) and the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC) Monday signed a Memorandum of understanding (Mou) to cooperate in promoting trade and investment in the country. ICIEC is a member of the Islamic Development bank (IDb) Group. The Mou, which was signed by Yaseen anwar, Governor State bank of Pakistan and Dr abdul Rehman Taha, Chief Executive Officer (CEO) ICIEC, here at SbP, is aimed at establishing a basis for the exchange of information between the two entities on banking industry’s condition and operating performance and ICIEC exposures on the banks operating in the country. under the Mou, both the parties shall cooperate for the purpose of promoting and supporting the flow of trade and investment to and from Pakistan in accordance with the prevalent laws and regulations. SbP shall endeavour to provide/share banking industry wide, not of individual bank, information and its reports, papers, etc on foreign investment environment in Pakistan with ICIEC as and when desired by the corporation.

National Tariﬀ Commission to protect local industry via investigation KARACHI

STAFF REPORT

HE study called by national Tariff Commission on Motorcycle industry is being seen as another attempt to provide duty free entry to just one bike maker from japan. according to the industry sources the nTC has for the first time decided to reverse its role and use the authority given to it by the government to protect the local industry to conduct an investigation on the proposal by an importer (in this case Yamaha) to evaluate local tariffs with a view to facilitate imports. The present nTC investigation is based on the premise that the local industry is overprotected and importers need some unprecedented relaxation to be competitive against a vibrant and growing industry. This will be a unique case in the history of tariff

protection not only in Pakistan but probably in the world at large where an importer’s comments are used against the national industry in the way. as per sources a proposal by board of Investment (boI) failed to find any favours at any ministry except boI itself, this is a desperate attempt to get the proposal through nTC. In case the boI gets its way at nTC, it may prove to be a unique case of its nature as in face of opposition from all major ministries and departments like the Ministry of Industries, Ministry of Commerce, the FbR and the EDb, a proposal for providing tariff relaxation to an entity is managed. The industry and the ministries are of the view that such relaxation to the new entrants in a growing and expanding industry will create distortions and will encourage brief case assemblers to miss use any relaxation by changing their name and getting themselves declared as

new entrants. already several brief case assemblers have cases opened against them. as reported the nTC has called a meeting of manufacturers, vendors and importers of motorcycles and spare parts in Islamabad on February 1st, after which a decision is likely that will allow new investment in the domain of two wheeler industry by putting at risk the investment that is already there in far greater size. The local motorcycle assemblers and vendors expressed their concern over this study by nTC as this simply appears as a facilitation exercise for a blue eyed entrant, through heavy concessions in duties and taxes. The amount of concessions being demanded and made possible through this exercise will translate into financing the purported investment capital free. The amount of concessions over a five year period may well be more than the promised foreign investment coming in. In addition,

according to the Pakistan automotive Manufacturers association (PaMa) data the two wheeler industry has shown recovery with a 13 per cent increase in production during the last fiscal year. The present tariff structure allows import of CKD at 15 per cent duty, and an approved assembler wanting to import certain localized parts is allowed to do so at a duty rate of 47.5 per cent. under aIDP, the current CKD was supposed to be further reduced to 10 per cent in the current fiscal year. This tariff structure has worked well for the industry and at present more than 70 motorcycle assemblers and another around 20 manufacturers of three wheelers are now part of this vibrant and growing industry. It is to be noted that new entrant policy kept the two-three wheeler sector out of its ambit in view of the peculiar stage of the industry. The industry needs stability and not adventurism.

‘Govt policies resulting in hyper inflation’ ISLAMABAD: People are faced with hyper inflation and joblessness due to the policies of the government as substantiated by the recent report on the performance of the first quarter released by the State bank of Pakistan. a statement issued by Chairman of jeevay Pakistan jeevay Maqami-Hakoomat (jPjM) Daniyal aziz said that the uncontrolled expenditures of the government were making it difficult to control fiscal deficit and pushing the people below the poverty line. He said that government was not following a democratic approach and its dictatorial decisions were bringing the economy on the precipice and inflation would increase in coming months. He said only that an honest leadership like Turkey and Malaysia could bring the country out of the quagmire. He asked the government to curtail its unnecessary expenditures, reducing the foreign tours and shorten the accompanying official entourage and ending the non useful ministries. STAFF REPORT

Sudanese Ambassador invites investment LAHORE: Sudan ambassador to Pakistan alshafie ahmad Mohamed Monday invited Pakistani businessmen to make investment or ink joint ventures with their Sudanese counterparts as the country has unparalleled and huge opportunities in rice, cement, pharmaceutical, textile madeups, food products, poultry and steel sectors. Sudanese ambassador was speaking at Lahore Chamber of Commerce and Industry. Deputy Head of Sudanese Mission Mohammed Eldei ali also spoke on the occasion. The ambassador said that this is the high time that the Lahore Chamber of Commerce and Industry should arrange a sector specific delegation to take part in Khartoum International Fair as preparation for this fair are in full swing. He said that the LCCI should also sign an Mou with the Sudan Chamber of Commerce or with Khartoum Chamber to further strengthen bilateral relations between the two sides. The ambassador informed the participants that a number of other countries had already invested heavily in oil sector in Sudan and Pakistan could also make investment for the joint benefit of the two countries. STAFF REPORT

TDAP organises workshop on cost reduction LAHORE: Proper planning and scheduling, selection of good service providers, training of staff and complete documentation are the essential elements for managing cost component during international trade transactions. TaQ Organisation Manager Corporate Development Faquir ullah Sabir opined this while addressing the participants of a workshop on “Efficient Logistics for Reducing Cost in International Trade” held at the Trade Development authority of Pakistan (TDaP), Lahore here on Monday. Global Research Facilitation Council Vice President Rizwan ahmed talked about the importance of logistics. “business community could foster fast results by manipulating rapid and express logistics which save time and cost of the businessmen,” he added. STAFF REPORT

Sweets price soar despite sugar price slump KARACHI: Sugar prices, whereas, have contracted by 40 per cent, the decrease does not reflect on the price lists of the retailers selling eatables like sweets, cakes, cookies, etc. Thanks to a lukewarm response on the part of government’s price control authorities like bureau of Supply and Prices Department of Sindh Government. There has been a great confusion over the central and provincial governments’ domain in terms of price control as when questioned the provincial authorities in Sindh government refer to the federal price control departments saying the commodity does not fall under its domain. no matter to what level the commodity prices have contracted, the buyers get little or in most cases no relief of that slump due to lack of check and balance from the official quarters concerned. Products like sweets, cakes, cookies and other eatables made of sugar stand to be one such example. STAFF REPORT

4th Japan-Pak business dialogue in March KARACHI: Pakistan and japan will seek more ways to enhance bilateral trade through the forthcoming 4th meeting of japan-Pak business dialogue in japan. The meeting held is scheduled to be held on March 22, 2012 at Tokyo. This was informed by Mr Hiroshi Tajima, Director (South West asia Division), Ministry of Foreign affairs, japan during a meeting with Tariq Iqbal Puri, Chief Executive, TDaP here on Monday. Mr Shahid Latif Khan, Director General, TDaP and Mr atif aziz, Director (CE), TDaP, Karachi was also present on this occasion. Hiroshi said the scheduled meeting will go a long way in enhancing bilateral trade between the two countries. STAFF REPORT

NTDCL starts power system analysis course LAHORE: an advanced level course on Power System analysis (PSa) for the engineers of power transmission companies started here today at the Power Planning Department of national Transmission and Despatch Company Limited (nTDCL). 17 engineers are being provided hands-on expertise on the PSS/E (Power System Simulation for Engineers) under the 3-week training programme. The scope of the training extends to develop the capacity of the trainees to analyse and propose solutions to remove the bottlenecks in the system – such as overloading of transmission lines and transformers, low voltage profile, as well as reduction in system losses by utilising state of the art PSa, (PSS/E) software. STAFF REPORT

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Tuesday, 31 January, 2012

news Fauji fertiliser maintains urea share at 41 per cent

NEELUM-JHELUM HYDROPOWER PROJECT

Kuwait to provide $40 million ISLAMABAD

KARACHI STAFF REPORT

aujI Fertiliser Company (FFC) maintained its urea market share at 41 per cent during CY11 by selling 2.4 million tonnes, marginally lower than CY10 sales of 2.5 million tonnes. This is in line with the five per cent decline in industry urea production. The lower production is attributed to gas curtailment of around 12 per cent for companies on the Mari network. as a result, FFC’s plant was able to operate at 117 per cent capacity compared to last two years average of 124 per cent. EnGRO sold 1.3 million tonnes of urea, depicting a 33 per cent YoY jump from CY10 urea sales of 0.95 million tonnes. Commencement of commercial operations of its Enven plant is the main reason behind this increase. During the year under review, EnGRO’s market share went up to 21 per cent from 16 per cent in the corresponding period last year. The Company’s production during CY10 increased by 31 per cent YoY to 1.3 million tonnes. However, the production figure was still short of its design capacity owing frequent plant shutdowns due to gas curtailment. Fauji Fertiliser bin Qasim Limited’s DaP plant operated at 101 per cent capacity, producing 657,000 tonnes of the product in CY11 (CY10: 655,000 tonnes). The company’s market share increased to 59 per cent in CY11 (CY10: 49 per cent), and it sold a total of 658k tonnes of DaP during the year. FFbL’s urea production however, was down 16 per cent YoY to 440,000 tonnes in CY11, mainly due to the company’s strategy of prioritising production of higher margin DaP in the face of gas shortage. Fatima Fertiliser Company Limited (FaTIMa) commenced commercial operations during CY11 and produced 425,000 tonnes of urea. The company was able to capture a market share of 7.5 per cent during the period under review. During CY11, FaTIMa produced 141,000 tonnes and 324,000 tonnes of nP and Can respectively.

AMER SIAL

aKISTan on Monday signed a loan agreement of $40 million with Kuwait Fund for arab Economic Development (KFaED) that will help expedite construction of 969 MW neelum jhelum Hydropower project on the River jehlum in azad Kashmir. The agreement was signed by Secretary Economic affairs Division (EaD) abdul Wajid Rana and Chief Executive Officer (CEO) of neelum jhelum Hydropower Project Company (njHPC) Lt. Gen (R) Muhammad Zubair. Secretary EaD, abdul Wajid Rana said that

signing a subsequently subsidiary loan agreement between EaD on behalf of the government and njHPC, a subsidiary of Water and Power Development authority (WaPDa) was a legal requirement to make the loan agreement effective. He said that with the release of $40 million from KFaED, the cash flow requirements for the project would be resolved to a great extent. He said negotiations with China were underway to seek further financing for the project. CEO njHPC said 30 per cent of the work on the project was complete. He said the Tunnel boring Machine (TbM) has also reached Pakistan which would reach the project site within next 20 days. He said that the project

would be completed by 2016 and after completion the TbM would be utilised for other projects. He said the cost of the project has increased Rs330 billion due to depreciation in rupee value against dollar and increase in the cost of raw material for construction. He said the project on completion would help generate Rs45 billion per annum in terms of revenue. njHP Project is located near Muzaffarabad upon completion will have the capacity to generate 969 MW 000 MW of electricity. The project is being built with the assistance of friendly countries. KFaED is one of the donors of this project; the other donors are Exim bank China, uaE and Saudi Fund for Development.

Pakistan and India are both constructing separately two hydropower projects on the same neelum River that runs through the disputed territory of jammu and Kashmir between the two countries. The Court of arbitration (Coa) Hague has already given a decision ordering India to stop carrying out construction of any permanent works on or above the Kishanganga River bed at the Gurez site that may inhibit the restoration of the flow of the river to its natural channel. Pakistan wants to complete this project before India to retain its chances of maintaining the river flow which could significantly decline if India managed to complete its project first. The government had imposed a surcharge

at the rate of 10 paisa on electricity bills to provide financing for the project which generates about Rs5 billion every year. The government had generated more than Rs18 billion during the last few years but due to financial constraints the pace of the project has remained slow. The project was initially approved by ECnCE in 1989. The government has recently increased financing for the project to complete it before time. njHP is first of its kind in the country, as the power station including allied services and transmission system has been designed underground to achieve optimum hydraulic head, given topographical limitations of the area. Thus, almost 98 per cent of the project structure will be underground.

Bears prevail as index plunges by 77 points KARACHI STAFF REPORT

uLLbaCK was witnessed at the local bourse in today’s session as KSE-100 index retreated 77 points for the day to close at 11,883 points. Market volumes have also simmered since the exponential surge when the CGT amendment was announcement, and finished the day at 67 million shares. With an earnings announcement that beat analyst expectations by a long shot, FFC was the undisputed market volume leader with 12 million shares. Lucky Cement also released its earnings estimate today which was in line

with analyst expectations. On the other hand, byco closed six per cent lower on the day as its losses increased from the previous year. While we expect the results season to keep volumes buoyant in the near term, investors don’t ap-

pear to be optimistic of the future, which will set the stage for more profit taking, said ali Hussain, Senior Investment analyst at HMFS. KSE 100 index closed at 11883.01 levels with the loss of 77.21 points, while KSE 30 index

lost 46.06 points to close at 11170.50 levels. all Share index closed at 8231.91 levels after losing 53.91 points. Total 60 scrips advanced 169 declined and 75 remain unchanged out of total 304 scrips traded.

CORPORATE CORNER LG’s 3D UD TV presents combination of immersive 3d

in May 2011. When bestowed upon foreign citizens, this distinction, created by General Charles de Gaulle, rewards their remarkable contribution to enhance relations between their country and France. PRESS RELEASE

Mobilink develops content-filtering solution to reinstate BIS

LAHORE: LG Electronics (LG) will unveil the world’s largest 3D ultra Definition (uD) TV at the Consumer Electronics Show (CES) in Las Vegas. by combining LG’s industry-leading 3D technology and Smart TV function with uD display technology, the 84-inch TV breaks new ground in immersive 3D home entertainment. “LG is pushing the limits of home entertainment innovation with this 3D uD TV,” said Havis Kwon, President and CEO of LG Electronics Home Entertainment Company. “We are bringing together all our Smart TV and 3D knowledge in the 3D uD TV in order to demonstrate to the CES audience that LG is committed to being the world’s leading brand for immersive home entertainment in 2012 and beyond.” PRESS RELEASE

Sanofi GM honoured by French Government KARACHI: The newly appointed ambassador of France to Pakistan, H.E. Philippe Thiébaud visited the Karachi Head Office of Sanofi Pakistan, where he conferred the prestigious French national award “Chevalier de l’Ordre national du Mérite” (Knight of the national Order of Merit) on Mr. Tariq Wajid, the General Manager & Managing Director of Sanofi Pakistan. Mr. Wajid was appointed French Knight of the national Order of Merit (Chevalier de l’Ordre du Merite) by the French President nicolas Sarkozy

LAHORE: Mobilink has developed and implemented an innovative content-filtering solution to reinstate internet services for the blackberry Internet Service (bIS). The initiative by Mobilink allows subscribers to fully access the internet, including social networking sites such as Facebook and Twitter, using their mobile devices. Omar Manzur, Director PR & CSR, highlighted, “Customer satisfaction is an essential driver at Mobilink, and this content filtering solution is our initiative to restore full functionality of internet services for our valued customers, while maintaining PTa regulations.” Mobilink pioneered the provision of blackberry services in Pakistan in 2005. The service had been partially blocked in 2010 following directives from the PTa to block social networking sites and other websites that contained blasphemous content. PRESS RELEASE

Four Brothers Group Pakistan celebrates 10 Years of Excellence BHURBAN: Pakistan’s foremost agricultural organization Four brothers Group Pakistan celebrated its 10 years of excellence celebrations in bhurban by organizing its Sales Team Conference and Family Get Together in which more than 550 agri Services (Tarzan) sales team members and the head office staff along with their complete families participated. The conference was chaired by Chairman Four brothers Group Pakistan Engr. jawed Salim Qureshi, CEO agro Division Dr. Khalid Hameed, CEO Telecom Division and Group Director Finance Muhammad nadeem Qureshi and GM Sales and Marketing agri Services Ch. Muhammad Tariq. Other important personalities on the stage were GM

Seed Development Dr. Zahoor ahmad, GM Market Research and Development Dr. ahmad Saleem akhtar and Ex-Chairman PaRC Dr. Zafar altaf. PRESS RELEASE

PITAC join hands with WEC to enhance skills development programmes

LAHORE: Pakistan Industrial Technical assistance Centre (PITaC), Ministry of Industries, Government of Pakistan has signed a 10-year agreement with a uK based organisation, World Education Centre (WEC) to enhance the quality of vocational training programmes and employability of youngsters in the country. In the initial phase, more than 10,000 skilled workers will be trained by the end of 2015 under PITaC-WEC venture and their job placements will be arranged in various industries of Pakistan which is also in line with the policy of the Ministry of Industries, Government of Pakistan. PRESS RELEASE

On behalf of TOTAL OIL PAKISTAN (Pvt) Ltd. And TOTAL PARCO PAKISTAN (Pvt) Ltd., “Flood Relief Assistance” was presented by Mr Qasim Zaheer – CEO & MD of Total Oil Pakistan (Pvt) Ltd. To Mr Meer Mohammad Parihar, representative of The Rural Uplift & Welfare Association (TRUWA) for flood affected people in Badin District – Dec – 2001. PRESS RELEASE

KARACHI: Mr. Murat M. Onart, Turkish Consul General in Karachi, with Yasmin Lari CEO Hertitage Foundation, Dr. Huma Baqai, IBA and others at International Women Leaders Summit held on 25 Jan at Karachi Marriott. PRESS RELEASE

KARACHI: Chairman Pakistan Petroleum Dealers Association, Abdul Sami Khan presenting flower bucket with delegation to new appointed CEO & MD, PSO Naeem Yahya Mir during the meeting in his office. PRESS RELEASE

CEO Bata Shoe organization Mr. R. Rizzo, Group MD Bata Emerging Markets West, Malaysia Mr. Fernando Garcia and MD Bata Pakistan Mr. Imran Malik along with officials from the banking sector were present at a dinner held at the Country Club. PRESS RELEASE