Profit for e-paper_Layout 1 11/4/2011 10:32 AM Page 1
Hyperinflation - a glaring reality for Pakistan 2 Why takaful has not been successful Page 3 Business community speaks out on the MFN issue Page 8 Pages: 8
profit.com.pk
Friday, 04 November, 2011
NA special committee looks for end to power crisis ISLAMABAD
e
STAFF REPORT
lecTinG Usman Khan Taraki as its chairman, the national assembly Special committee decided on Thursday to start holding regular meetings to finalise recommendations for ending power shortages. nearly all members stressed that the special committee should not work like ordinary committees that meet only once a month. Stressing that the committee should look into the issue holistically,
Saima akhtar Bharwana proposed that any member of the committee who did not attend two consecutive meetings should be warned, and failure to attend a third time should merit disqualification. Rana Tanveer Hussain of PMl-n said the committee should focus on resolving the problem otherwise it will help the government by diverting the attention of the house. Shahid Khaqan abassi of PMl-n said the power crisis was a complex maze for which even the government has failed to find a solution during the last three years. However, he said every problem has a solution which can be
only found if meetings are held regularly so that focus is retained. The members gave different suggestions for understanding the basic issues before looking into the problem for solutions. ayatullah Durrani of PPP proposed that the members should be provided the recommendations of the energy summit to understand the issue and decide on the future line of action. Shahid Khaqan abassi quipped that the prime minister, while summing up the summit, said if anybody has any solution he should contact him. Farooq Sattar of MQM proposed that the
committee should ask for the same briefing that was recently given to the federal cabinet in which all the issues and recommendations were explained. Farooq Sattar proposed that maximum natural gas should be diverted to the power sector as the price of electricity generated from gas was four times cheaper than power generated from furnace oil. He suggested stopping gas supply to fertiliser sector, as he said urea imports were cheaper than furnace oil imports. He said there was no coherent load management plan available with PePcO and some heads must roll
to improve the system. He also lamented that despite abundant wind power potential the government had not been able to fully exploit the potential. acceding that the government has failed to resolve the power crisis, ayatullah Durrani of PPP said that the problem could be overcome simply by improving the administration, which he termed very weak at present. Shahid Khaqan abassi said the power crisis was a complex matter, which even the incumbent government was unable to fathom for the last three years and the committee was faced with a Herculean task.
Govt attaches importance to resolution of energy issue: Dr Sheikh ISLAMABAD STAFF REPORT
Senate finance body approves two key bills Standing Committee on Finance okays gas infrastructure development cess and petroleum levy bills g Govt aiming for rs35 billion under the gas cess g $1b required for dedicated Karachi-lahore lnG pipeline, says petroleum minister g
ISLAMABAD
T
AMER SIAL
He Senate Standing committee on Finance approved two bills on Thursday for the imposition of gas infrastructure development cess and petroleum levy on compressed natural gas (cnG) and liquefied natural gas (lPG). However, the committee barred collection of these levies from domestic sector consumers and general public, limiting its scope to the companies.
Money billS The committee met under the chairmanship of Senator ahmad ali of MQM. it asked the government to prove whether the two bills were money bills or ordinary pieces of legislation. The matter was resolved after a covering letter from the Speaker national assembly was produced before the committee, which was forwarded to the Senate along with the draft of the bills terming them money bills. explaining the rationale for natural gas cess, Secretary Petroleum ejaz chaudhary explained that the gas development surcharge (GDS) went directly to the provinces and they did not spend a penny on infrastructure development. He said the gas cess will create space for the federal government to develop the infrastructure, as it will generate Rs35 billion per annum. allying concerns of members that the cess will directly affect the public, Petroleum Minister Dr asim Hussain assured it would be imposed only on companies and not domestic sector consumers as recommended by the committee.
HanDS tieD expressing skepticism, Senator ishaq Dar of PMl-n said historically cess has been a misused instrument, never serving the purpose it was employed for. if there were a genuine need to develop infrastructure, then Public Sector Development Programme should be utilised. He said the government was attempting to depress natural gas demand by increasing prices, which will further burden poor people with additional taxes of Rs35 billion per annum. The petroleum minister said the government’s hands were tied, as $1 billion were required for deploying a dedicated pipeline to transmit lnG from Karachi port to lahore. Under the law, Sui gas companies get 17 per cent return on developing infrastructure, while a markup of 17 per cent will be payable on the loan procured, which will also impact the people, but cess will help counter this burden. Dar demanded a firm guarantee from the government, that the collected amount would be directed towards infrastructure development. He also asked for removal of other purposes from the bill. He feared that the amount generated from the cess would be passed to PePcO on account of power subsidies. He demanded a separate account for the cess, as he did not want its fate like Rs 57 billion workers welfare fund (WWF).
FertiliSer SubSiDy However, Finance Secretary Dr Waqar Masood Khan stressed retention of the clause and assured the cess would be used properly. conceding that the government had utilised WWF funds, he said it was aware of its liabilities and was paying them. He said the power cess of Rs5 billion per annum was efficiently being used for the
construction of neelum Jhelum hydropower project. Senator Haroon akhtar Khan said project cost has already increased manifold and would end up producing hydel power at the most expensive cost of $3.5 million per MW. He asked for ending subsidised gas to the fertiliser sector, which was receiving gas at $1.2 per mmBTU as compared to international price of $16 mmBTU. Dar said Rs28 billion could be collected only by increasing the gas tariff for fertiliser sector from Rs100 per mmBTU to Rs350 per mmBTU, even though it will still remain the lowest as compared to gas tariff of other sectors. The petroleum minister said cross subsidy to fertiliser sector could not be withdrawn immediately, but would be abolished gradually. chairman ahmad ali said people are not ready to pay taxes, so the government is left with no other option. He said the government has committed that the tax will not be imposed on domestic sector consumers, and the bill should be passed. Dar said since the bill did not mention the prescribed tariff rate, it should include the complete tariff, as the committee would not provide blanket cover for tariff or extend open ended taxation powers to the government. The government assured compliance and the bill was approved. On the amendment in petroleum levy, the finance secretary said the government wants to retake power from the parliament to remove distortions in lPG and cnG sectors. Dr asim said a few chosen people have held up opening of the lPG sector for competition. However, Dr Safdar abassi of PPP questioned the move and asked him to explain how cartelisation was happening in the sector as 85 per cent of local lPG production controlled by three state owned companies. Dr asim said influential people are hampering import of lPG, as they have a monopoly over the lPG marketing business. He said import of lPG was necessary to counter the energy crisis. The committee approved the bill with the dissenting note of Senator Safdar abassi.
F
inance minister Dr abdul Hafeez Sheikh urged the Friends of Democratic Pakistan (FODP) Team to fast track the implementation process in order to consolidate democracy and support the social and economic development of the country. The meeting decided to form a committee comprising representatives of ministry of commerce, water and power, planning commission, foreign affairs and economic affairs division to ensure continuous cooperation with FODP member countries. This committee will review the progress, achievements and status of the implementation of reports and find causes of slow progress by FODP. The High commissioner of United Kingdom and ambassadors of United States, Germany, and Japan were briefed about economic reforms in the realm of macro-economic stability framework, with main focus on the energy sector recovery programme. While talking to them, the finance minister said the present democratic government attaches tremendous importance to the resolution of the energy issue as it is related to the overall security and the democratic set up in the country. He said with coordinated effort of line ministries, an energy sector recovery programme has been formulated. He also said in a broader sense certain aspect of the energy issue is related to economy and social development and ultimately to the democratic set up in Pakistan. The ambassadors of the FODP countries and the finance minister agreed upon the nature of FODP as a political forum and not a donor club. Their discussions thus went on to talk about measures to strengthen bonds of cooperation between FODP and democratic Pakistan; they also maintained that strong Pakistan meant a democratic Pakistan. The minister asserted that the FODP should focus on terrorism which is variably and invariably hampering the economic development of the country. The finance minister apprised the diplomats of the steps taken by the government for upgrading the level of development in the province of Baluchistan; which included, the doubling of the funds, allocation of more resources and recruitment of youth in the public sector organisation and government departments. He also highlighted the educational programme there.
Profit for e-paper_Layout 1 11/4/2011 10:32 AM Page 2
02
Friday, 04 November, 2011
debate
Hyperinflation-a glaring reality for Pakistan
M
ALI RIzvI
acRO economic stability is a pre-requisite to growth without which countries that seek to maintain sustained levels of economic growth inevitably struggle. it needs to be understood that fluctuations in the price level, exchange rate, interest rate or increasing tax burden on the consumers, go on to serve as a major deterrent to investment that is the fundamental driver for growth.
InflatIon and economIc growth However, one thing that has emerged in this fast globalising world is that high inflation is incredibly damaging to investment and growth in a country’s economy. The dilemma that is then faced by the economic managers is the fact that bringing inflation down is both costly and eventually leads to lost output and employment. Therefore, what economic managers need to sit down and decide upon is how high is dangerous? it is pertinent to mention that inflation, more often, than not accompanies economic growth. Some countries across the world including Pakistan, from the early 2000’s till 2008 achieved sustained levels of economic growth however; growth was accompanied by persistent inflation. Historically, several countries across the globe have witnessed sustained levels of growth that have been accompanied by inflation of 15-30 per cent. However, given the changing global scenarios where countries are targeting to cut down on the inflation threshold both in the US, europe and emerging economies, this threshold seems rather excessive. What though, has been unanimously agreed upon is the fact that inflation should be maintained in single digits. However, there still remains some ambiguity over the benefits of bringing inflation down to very low levels.
monetary polIcy and govt borrowIng
drIvIng economIc growth
Given this simplistic argument we can access the damage that has been caused by unprecedented borrowings by the government from the State Bank of Pakistan. While on the one hand a contractionary monetary policy has been employed by keeping interest rates high to rein in inflationary pressure, on the other the government has been borrowing vulgar amounts of money from the central bank. This situation is quite a paradox since it signifies that the contractionary monetary policy is effectively rendered redundant due to short sighted policies of the powers that be. Furthermore, the recent rate cut denotes that now, since the government has plans to borrow even more money from the central bank of the country, their borrowing costs will decrease significantly that will give them a cushion for borrowing. Yes, a rate cut has its positives as well, it helps boost business activity and increases liquidity in the market however this paradoxical situation simply sheds light on the government’s sincerity to address serious concerns.
in order to achieve high levels of economic growth, there must be a focus on increasing the market share of exports in the global economy along with a rapid integration with world economies. This process is heavily dependant on exchange rates, interest rates, and inflation. Therefore, the decision of the central banks in all three core areas mentioned above, bear significance on the effective implementation of growth strategies. a balance is required in this regard so that both the needs of autonomy of the central bank and the need for coherence are not compromised.
autonomy for central banks What has been unanimously agreed upon by financial managers across the globe is that it is best to allow the central banks to fight inflation by giving them a certain level of autonomy and insulation from the short sighted and immature behaviour of politicians who may want the central bank to relax its grip on inflation especially, before an electoral campaign in order to gain access to funds and bankroll their extravagant spending plans. Unfortunately, in the curious case of Pakistan’s economy while the interest rates have been cut down by the State Bank of Pakistan, and the inflation index revised politicians and the authorities continue with their borrowing binge that is severely harming the central banks’ attempts to rein in inflation. This is mainly due to the fact that despite remaining in power for the last four years the government has not made sincere efforts to widen the tax base to generate revenues. Furthermore, they have allowed the circular debt to balloon that has contributed to deteriorating the fiscal deficit of the country. agreed, that the circular debt has been carried forward from the previous government however, this particular plague could have been dealt with had timely action been taken and funds been provided for to resolve this particular issue.
rIsIng debt and vested Interests With a revised inflation index, the government has now received a greater cushion to continue unprecedented borrowings from the State Bank of Pakistan. in the last 60 years of Pakistan’s existence, the combined total public debt was Rs4.8 trillion and with the advent of the current PPP government this public debt in only a time span of four years has expanded to more than Rs10.5 trillion, growing by a gargantuan Rs5.7 trillion in the last four years. One is then compelled to wonder, if so much money was printed what has been the direct impact for that on the economy.
a
Kenneth Rogoff
lTHOUGH i appreciate that exchange rates are never easy to explain or understand, i find today’s relatively robust value for the euro somewhat mysterious. Do the gnomes of currency markets seriously believe that the eurozone governments’ latest “comprehensive package” to save the euro will hold up for more than a few months? The new plan relies on a questionable mix of dubious financial-engineering gimmicks and vague promises of modest asian funding. even the best part of the plan, the proposed (but not really agreed) 50% haircut for private-sector holders of Greek sovereign debt, is not sufficient to stabilize that country’s profound debt and growth problems. So how is it that the euro is trading at a 40% premium to the US dollar, even as investors continue to view southern european government debt with great
Borrowing can be justified when it is being utilised to finance productive developmental projects, but when the same borrowing is used to finance unproductive projects, it leads to a catastrophe. That is exactly what has been happening in the case of Pakistan. a simple, economic phenomenon is known as the quantity theory of money that argues in very simple terms that the supply of money has a direct and proportional relationship with the price level. in simpler terms, when you increase the money supply in an economy, inflation rises.
borrowIng can be justIfIed While government borrowing can be justified in cases where it is spent correctly on development projects, the fundamental aspect that needs to be taken into account is the fact that debt isn’t always bad if debt to GDP ratio is being maintained. However in the absence of real GDP growth in Pakistan, the growing public debt is a cancer that can debilitate the very foundations of our economy. in the case of rapid GDP growth, governments can afford big deficits by maintaining debt to GDP ratios. Furthermore, there is a need for the government to also relieve infrastructure bottlenecks to facilitate economic growth. in the absence of this, growth may falter.
former governor deserves credIt Unscrupulous government borrowings are disastrous, it is an established fact. The PPP government has been unable to raise ample resources to pay its bills and finance public spending. instead they have resorted to forcing the central bank to print money. This viscious cycle has the ability to end in hyperinflation, and in the current scenario hyperinflation cannot be ruled out. Shahid Kardar deserves credit for resisting government pressure in this regard and that eventually led to his resignation from the position of governor SBP. in the absence of people like Kardar, it is only a matter of time before Pakistan gets pulled into a viscious whirlpool of hyperinflation, debt, high unemployment and negligible real GDP growth. The process has started, and the financial managers need to urgently pay attention and intervene by refusing unjustified government demands that are harming the interests of the country.
The writer is News Editor, Profit. He can be reached at ali.rizvi7957@gmail.com
A gravity test for the euro skepticism? i can think of one very good reason why the euro needs to fall, and six not-so-convincing reasons why it should remain stable or appreciate. let’s begin with why the euro needs to fall. First, investors might be telling themselves that in the worst-case scenario, the northern european countries will effectively push out the weaker countries, creating a super-euro. But, while this scenario has a certain ring of truth, surely any breakup would be highly traumatic, with the euro diving before its rump form recovered. Second, investors may be remembering that even though the dollar was at the epicenter of the 2008 financial panic, the consequences radiated so widely that, paradoxically, the dollar actu-
ally rose in value. although it may be difficult to connect the dots, it is perfectly possible that a huge euro crisis could have a snowball effect in the US and elsewhere. Perhaps the transmission mechanism would be through US banks, many of which remain vulnerable, owing to thin capitalization and huge portfolios of mortgages booked far above their market value. Third, foreign central banks and sovereign wealth funds may be keen to keep buying up euros to hedge against risks to the US and their own economies. Government investors are not necessarily driven by the return-maximizing calculus that motivates private investors. if foreign official demand is the real reason behind the euro’s strength, the risk is that foreign sov-
ereign euro buyers will eventually flee, just as private investors would, only in a faster and more concentrated way. Fourth, investors may believe that, ultimately, US risks are just as large as europe’s. True, the US political system seems stymied in coming up with a plan to stabilize medium-term budget deficits. Whereas the US congress’s “supercommittee,” charged with formulating a fiscal-consolidation package, will likely come up with a proposal, it is far from clear that either Republicans or Democrats will be willing to accept compromise in an election year. Moreover, investors might be worried that the US Federal Reserve will weigh in with a third round of “quantitative easing,” which would further drive down the dollar.
Finally, investors might just believe that the eurozone leaders’ latest plan will work, even though the last dozen plans have failed. abraham lincoln is credited with saying “You can fool some of the people all of the time, and all of the people some of the time, but you cannot fool all of the people all of the time.” a comprehensive euro fix will surely arrive for some of the countries at some time, but not for all of the countries anytime soon. So, yes, there are plenty of vaguely plausible reasons why the euro, despite its drawn-out crisis, has remained so firm against the dollar so far. But don’t count on a stable euro-dollar exchange rate – much less an even stronger euro – in the year ahead. Kenneth Rogoff is Professor of economics and Public Policy at Harvard University, and was formerly chief economist at the iMF. a version of this article was first published on Project Syndicate.
Profit for e-paper_Layout 1 11/4/2011 10:32 AM Page 3
friday, 04 november, 2011
SHari’a MatterS edItorIal
Why takaful has not been successful
When checking cartelisation inallY there is some official movement on checking the genesis of erratic urea price movements. and even though the same steps would have had much more value if relevant circles had pre-empted the commodity’s inflation, directly linked as it is to food affordability, certain factors need taking care of. it is true that fertiliser companies had warned against price increases when the announcement concerning imminent gas shortage was made. Yet the government waited till the companies unilaterally jacked up urea price, meaning whatever action they will take will materialise after cost push inflation feeds into the food market. also, while joint market positions that pressure agri prices to the upside must register on the regulator’s radar, it must ensure that the government’s promise of providing the sector with uninterrupted gas supply is taken into account when deliberating over the case. There are definitely lapses on the official side, cramping the companies’ ability to meet pre-scheduled financial transactions. as things stand, regulatory authorities should investigate
F
whether gas supply bottlenecks mandate coordinated price increases to the tune undertaken. The issue of cartelisation is also important because fertiliser companies occupy a position of considerable prominence on the bourse, and price-manipulation on their part can alter market movements, opening a new chapter in the investigation. it is also important to ensure both speed and transparency in this exercise, since it will set an important national precedent. Of late, the government has been slow to react to price distortions that ultimately pressure middle and low income groups with stagnant wages. at the risk of repetition, this is probably the worst time to ignore valid concerns of the people. in too many parts of the world, they are reacting violently to what they consider unfair and unlawful seizure of their rights. Food cannot be allowed to become expensive because the government cannot settle a gas supply deal with a particular sector. Or because a few heavyweights can gang up to influence the market. again, transparency must be assured.
humayun dar nSURance is considered prohibited in islam and some of the objections to conventional insurance are: (a) The contract of insurance does not pass the criteria of validity as any valid contract in islamic law must specify unambiguously the consideration, the object of sale and its delivery time and place. in the case of insurance, while price (premium) and schedule of payments are known with certainty, it is not known when the object of sale will be paid if at all. This is considered as an example of contractual uncertainty or what is more commonly known as gharar in islamic law. (b) Some scholars oppose conventional insurance because of its similarity with gambling. One feature of gambling is the fact that the gamblers pool their money so that one benefits from this pool at the expense of others, contingent upon the outcome of a stochastic process. The only difference is that the stochastic process to draw the "lucky" person is not a game but an event (like theft or loss of life). (c) Some other scholars deem insurance as something equivalent to riba or interest. The contract of insurance can be seen as payment of unequal quantities of money by the insurer and insured, which is precisely riba. a simple riba-based transaction would involve payment of X pounds by a party a to another party B who repays party a either less or more than X pounds, whether on spot or deferred. in case of insurance, the amount of premium is normally significantly less than the value of the item insured. Given these perceived issues, one must have thought that takaful – an islamic alternative to conventional insurance – would have become an automatic choice for the Muslims who are looking for modern shari’a. The question arises as to why it is taking so long for the takaful industry to take off; why aren't there enough investment vehicles for takaful companies to invest in? This is no longer an embryonic industry, yet it hasn't grown as quickly as the islamic bond industry. Following are possible explanations;
I
awareness of takaful as a viable insurance solution is on the rise Foreign exchange reserves
Average Joe s problems
The statement made by abdul Hafeez Sheikh during a visit to the US – that Pakistan can meet its debt repayments obligations while maintaining foreign exchange reserves of over $16 billion – was indeed surprising. There are several other ways of maintaining foreign exchange reserves rather than relying on loans and foreign aids. Dollar is increasing against Pakistani rupee and this is further deepening the abyss of debt repayment. if we continue to rely on the earlier mentioned ways of paying debts while maintaining our foreign reserves then we can never be able to gain economic stability for a decade, at least.
The unpredictability surrounding the KSe index knows no bounds. not only are the haphazard trends, tiresome to keep track of they also make the average Joe investor’s task of “keeping on his toes” all the more difficult. add the risk factor into the mix and the average Joe has another mountain to climb before he could plunge into this hotchpotch of twists, turns, rises, falls and whatnots! Fatima Fertiliser has been the ‘go-to’ play for most of the average Joes and their creed alike, but its lack of appeal is also causing problems. let’s hope that the “chhota Fauji” can save the day!
RohAIL ASLAM
ShAhID RehMAn ISLAMAbAd
LAhORE
1. Takaful has not been able to attract an influential founder or champion as islamic banking fortunately had. Starting right from the beginning, with Dr ahmed el naggar to Sheikh Saleh Kamel, chairman of Dalla al Baraka Group and the recipient of the first Royal award in islamic Finance, islamic banking has received a lot of support from many influential figures in banking, academia and lately from governments as well. 2. insurance is a relatively small sector whereas islamic banking & finance has flourished. insurance is considered as a "luxury" good and hence is considered for purchase only by those who are in the upper-income and wealth brackets. as such families are already better off economically, they prefer not to opt for insurance and rather prefer to invest in property and family business as a form of insurance and life cycle risk management. 3. This leads us to another related point - the effective market size. in the developing Muslim countries, only public sector employees are forced to save in the form of their pension and social security contributions. Public sector employment is only a fraction of the total employment in these countries, which rather restricts the market size for insurance and related products. 4. a right takaful model has yet to emerge. Mudaraba, wakala and hybrid models are not entirely convincing. The over-blown trumpet for mutuality in support of takaful has not lured any significant number of users for takaful products. This has also kept a number of conventional players out of the market because mutuality is facing a downfall. This demandsupply double edge drag has not been helpful for the growth of the takaful industry. 5. in absence of the right kind of assets for investment by takaful companies, takaful operators have found it difficult to generate impressive returns on their investment or endowment funds. This has obviously not been helpful for generating more demand for endowment policies by the Muslim masses. The observed growth in takaful has not been as expected by many industry players. in countries such as the UK, where one islamic insurance initiative has recently failed, immediate future of takaful business is rather bleak. However, there is significant potential in other countries including Pakistan. With the increase in availability of islamic financial services, the demand for takaful profucts is bound to increase. awareness of takaful as a viable shari'a-compliant insurance solution is also on a rise, which should help future growth. The growth prospects are bright in the countries where Muslims live in great number and proportion. But it will take a few years for the industry to have the popularity enjoyed by islamic banks. The writer is a freelance journalist and economic researcher. He can be reached at rizmaqs@gmail.com
PIA: A crisis of reputation plummeting profits shah murad ia is entering another potentially dark chapter, as its corporate image has been badly damaged due to continuous violation of air safety regulations, long flight delays, continuous cancellations, emergency landings and technical faults with its aging fleet. Besides, deteriorating air consumer confidence and declining profitability the Pia’s flight safety standards are also at lowest ebb and threatening the Pia itself to be put on watch-list of international watch-
P
dogs regulating the airline industry. On the other hand, long silence of the national regulator, civil aviation authority (caa), over the ongoing violations endangers lives of air passengers. aviation experts argue that caa is deliberately ignoring the Pia’s violation of air safety regulations because of shared vested interests. Some aviation experts say that maintenance of Pia aircrafts is deliberately being ignored to cause severe delays and cancellation of flights to justify the need for purchasing new aircraft, to the tune of billions of dollars. On the other hand, such violations are cause for serious concerns for the international civil aviation Organisation (icaO), european aviation Safety agency (eaSa) and other international aviation watchdogs on the reinforcement of standards related to worthiness of Pia’s fleet. a more thwarting incident occurred in Paris where Pia’s airbus a 310 (number aP BGO) was returning from Milan via Paris and when it landed at charles de Gualle
airport, the SaFa inspectors of european aviation Safety agency (eaSa) checked the aircraft and detected over 40 snags. Secondly, cancellations of numerous domestic as well as international flights have also infuriated air passengers including stranded Hajj pilgrims. Only in October, over 148 flights were cancelled due to technical reasons, 35 due to operational issues and 31 due to other reasons. Pilgrims heavily criticised Pia’s management and have also urged the president and prime minister to take notice of the ongoing crisis. currently, fleet of Pia is based on total 39 aircraft, of which at least 27 are over twenty two years old while remaining 12 are five to eight years old. Five types of aircraft, for catering to domestic and international operational needs including Boeing 737, Boeing 747, Boeing 777, aTR and airbus 310, are being used. The first two are outdated and the last one doesn’t meet icaO’s safety standards. The international civil aviation Organi-
SHaHab JaFry business editor
Kunwar KHulDune SHaHiD sub-editor
babur SaGHir creative head
ali riZvi news editor
MaHeen SyeD sub-editor
HaMMaD raZa layout designer
and strategic errors by the management have plunged pIa into a deep crisis
sation (icaO) is a United nations specialised agency which regulates airline industry globally. Pakistan is a party to the chicago convention, 1944. article 37 of the convention requires that each contracting state undertakes collaboration in securing the highest practicable degree of uniformity in regulations, standards and procedures in relation to all matters of civil aviation in which such uniformity will improve air transport services. it is worth mentioning that icaO’s Standards and Recommended Practices (SaRPs) are minimum requirements and state members are encouraged to go beyond existing standards and impose more stringent requirements. in this regard, icaO’s Safety Oversight Manual states that safety oversight also ensures that the national aviation industry provides a safety level equal to or better than that defined by
standards and recommended practices. in Pakistan the civil aviation authority (caa) is regulating all aspects of commercial aviation activities under the provisions of civil aviation authority Ordinance 1982. Safety oversight is the core function of caa. its prime responsibility is to implement icaO's Universal Safety Oversight audit Programme (USOaP) and ensure that airlines are operating in compliance with air safety standards and recommended practices (SaRPs). The caa should promote safe, secure and sustainable mode of air transportation services in Pakistan through effective implementation of safety standards and regulations. The writer is an aviation lawyer. He can be reached at shahmurad@live.com
for comments, queries and contributions, write to: Muneeb eJaZ layout designer
email: profit@pakistantoday.com.pk Ph: 042-36298305-10 Fax: 042-36298302 website: www.pakistantoday.com.pk
Profit for e-paper_Layout 1 11/4/2011 10:32 AM Page 4
Friday, 04 November, 2011
04
Each new commodity that gets listed on the exchange brings with it the specialists of the respective field
news
MD PMeX, Samir ahmed
SBP tightens and revises regulations on exports Move to streamline on-site verification of documents g noC responsible for conducting on-site verification g
KARAChI
T
STAFF REPORT
He central bank has made it mandatory for the exporters and banks to submit the original duplicate copy of the ee-1 statement to verifying SBP BSc office. The move is aimed at further streamlining the process of on-site verification of relevant documents on the basis of which transfer of limit and performance is allowed from one SBP BSc office/bank to another SBP BSc office/bank. also, the regulator has decided
that the reserve maintenance week would start from Friday and end on following Thursday for the purpose of maintaining cash Reserve Requirements (cRR) in cash Reserve account-cRa (US$) and Special cash Reserve account-ScRa (US$) against deposits raised under Fe circular 25 of 1998. Further, the central bank also notified the banks and development finance institutions (DFis) that for the purpose of maintaining Statutory liquidity Requirements (SlRs) and cRRs during the week starting from Friday and ending on following Thursday, Time and Demand liabil-
ities (TDl) as of close of business on previous Friday (i.e. with lag of one week) will be taken into account. nOc issuing SBP BSc Office would be responsible for conducting on-site verification of ee-1 statement and relevant documents during on-site verification of the bank even if no loan has been availed by the exporter at that office/bank. any violation observed therein will be communicated to the nOc receiving office, in order to charge fine(s) for violation(s) under the provision of export Finance Scheme (eFS). On-site verification of documents against ee-1/eF-1 statements will also be carried out at bank(s) who issued nOc in favour of other banks within one centre for the purpose of transfer of exporters’ limit another circular, DMMD circular
Pakistan, Indonesia agree to sign PTA agreement ISLAMABAD STAFF REPORT
P
aKiSTan and indonesia have agreed to sign Preferential Trade agreement (PTa) under which both countries would enjoy market access on a preferential rate. The federal cabinet in its meeting held on 2nd november, 2011 approved the signing and ratification of the PTa between the two countries. Under the agreement, indonesia agreed to offer market access to Pakistan on 221 tariff lines on preferential rate while Pakistan has offered indonesia preferential tariff under 288 tariff lines for market access. after the signing of PTa agree-
ment between both the countries, PTa shall enter into force within 30 days, after the date on which the parties exchange written notifications for completion of their respective legal procedures. Pakistan and indonesia signed the comprehensive economic Partnership agreement (cePa) in november 2005 on the occasion of the visit of the President of indonesia to Pakistan. Under the provisions of cePa, in 2006, both countries commenced negotiations to conclude a PTa. The agreement would ultimately create a Free Trade area between the two countries. Both countries successfully concluded the negotiations process during the 8th round of negotiations held on
16th September, 2011 in Jakarta, indonesia. Under the agreement, indonesia agreed to offer market access to Pakistan on 221 tariff lines on preferential rate includes fresh fruits, cotton yarn, cotton fabrics, readymade garments, fans (ceiling, table, pedestal) sports goods (badminton and lawn tennis rackets), leather goods and other industrial products. indonesia also offered market access to Kino from Pakistan at zero per cent which will provide a level playing field to this product in the indonesian market. Similarly Pakistan’s offered list to indonesia, under the agreement, includes a total of 288 tariff lines for market access at preferential tariff.
no. 22, said: “it has been decided that for the purpose of maintaining cRR in cash Reserve account-cRa (US$) and Special cash Reserve account-ScRa (US$) against deposits raised under Fe circular 25 of 1998, the reserve maintenance week will start from Friday and end on following Thursday”. if new York Federal Reserve Bank is closed on Friday (i.e. first day of reserve maintenance week), the balances in cRa and ScRa as of previous day will be used for closed days also. adding that the above instructions would take effect from 18th november, which means during the week starting from 18th november and ending on 24th november, Fe-25 deposits as of 11th november 2011 would be used for maintaining balances in cRa and ScRa.
brokers, investors turn to growing commodity market KARAChI STAFF REPORT
c
OUnTRY’S commodity trading market has visibly entered into the growth momentum and is on its way to becoming a central hub for commodity related activities which includes investing in precious metals. The number of new investors trading on the exchange grew more than 245 per cent in the current year. at present there are investors in cities from Karachi, lahore, islamabad, Multan, Faisalabad and Peshawar to smaller cities like Jhelum, attock, Jhang, Sargodha and Rahim Yar Khan who are actively investing in Pakistan Mercantile exchange (PMeX). PMeX has more than 320 members. every month more brokers are activating their memberships by getting registered with the Securities and exchange commission of Pakistan.
Fertiliser sector leads bulls with 82 point gain KARAChI STAFF REPORT
M
aSSive stock swapping in fertiliser stocks allowed the sector to lead the turnover, which has been on decline mainly due to low interest ahead of eid holidays. Front line and mid-tier stocks continued to stay a victim of syndicated activity by the local participants both from corporate and high net worth circuit. Fauji groups stocks along with other mid-tier stock of the sector stayed under pressure, while muscle power in engro allowed the stock to hit and sustain the maximum. along with the active fertiliser stocks, front line cement stocks did invite trading activity mainly on the MFn declaration to india along with positive impact on financial charges due to recent decline in local interest rates.
islamic agricultural and rural finance to bring green revolution LAHORE: in the wake of the current financial crisis coupled with the global food shortage the need for improving village economy through enhanced output has become a challenge for planners and other stakeholders. The importance of livestock and allied sectors cannot be compromised for the agricultural growth. islamic agricultural and rural finance can bring genuine green revolution to an economy. as islamic finance has made a lot of progressive research in agricultural finance bringing a number of pragmatic and useful choices, which if implemented can bring revolutionary development to the economy. STAFF REPORT
Sugar Mills association appreciates ministry of industry’s directive LAHORE: Pakistan Sugar Mills association (PSMa), chairman Javed Kayani has appreciated the decision taken by the Ministry of industries to direct Trading corporation of Pakistan (TcP) for the purchase of 200,000 tonnes of sugar at the prevailing market prices which are at the lowest ebb during the entire season. Javed Kayani said that this step would enable the growers to sow wheat, canola and sunflower on time and will help to redress and mitigate their plight as they have been greatly devastated during the recent floods and rains. He said that due to the surplus availability of sugar stocks, the market has considerably gone down and the decision to take advantage of the situation by the senior minister of industries is a laudable step. STAFF REPORT
Port Qasim authority purchases bungalow for its liaison office KARAcHi: Port Qasim authority has invited bids to purchase a bungalow of 2000 square yards for its liaison office despite being offered free space at the Pakistan national Shipping corporation (PnSc). Official sources at the corporation informed Profit that after the advertisement of PQa for the purchase of bungalow at the most expensive area of the city, Shahra-e-Faisal, the corporation offered them their required space free of cost in the building of the corporation near Karachi port, but due to reasons best know to them, the PQa administration declined their offer and was still mulling on buying a bungalow at Shahra-e-Faisal, which could cost them millions of rupees, sources added. WAqAR hAMzA
nePra approves hiking power tariffs by rs1.77 per unit iSLAMABAD: national electric Power Regulatory authority (nePRa) approved to hike power tariffs by Rs1.77 per unit on request of central Power Purchasing agency (cPPa). The power tariffs have been raised for the month of September. according to national electric Power Regulatory authority (nePRa), tariffs of power distributing companies have been revved up under monthly fuel adjustment, as electricity to the tune of 8.11 billion units, was sold out to these companies during September. according to nePRa sources, the electricity prices were raised due to soaring cost of furnace oil. The recent hike is not applicable to Karachi electric Supply company (KeSc) and lifeline users. it should be pertinent to note here that the cPPa pleaded nePRa to hike tariffs by Rs1.80 per unit when nePRa had already hiked the power tariffs by Rs5.08 for the months of July and august. NNI
Cement sales post nominal increase
anticipation of likely resolution of circular debt through issuance of bonds kept the front-line banking stocks active in the trading window, while various high priced stocks from Oil and Gas sector continued to invite off-loading on strength, thus disallowing any excitement in the stocks during the session. The KSe 100 index closed at 11807.46 levels with the gain of 61.37 points, while KSe 30 index gained 82.59
points to close at 11138.69 levels. all Share index closed at 8175.56 levels after gaining 39.94 points. Total 121 scrips advanced 121 declined and 90 remain unchanged out of total 332 scrips traded. Hasnain asghar ali at aziz Fidahusein said caution however stays the call with accumulation in the fertiliser stocks away from the wrath of gas curtailment and high borrowings, official state-
ment regarding availability of gas, as is being echoed in the local arena should await change of stance. While materialisation of official commitment of resolving circular debt and cGT review will continue to offer the desired trigger, speculative activity and low quantum strength in high priced stocks will continue to offer offloading/short selling opportunity, he added.
LAHORE: cement sales during the month of October posted a nominal increase of 0.74 per cent as the sector faced an uphill task to cope with ever increasing losses. according to cement despatch data released by all Pakistan cement Manufacturers association (aPcMa), cement despatches in October 2011 were nominally higher than the 2.923 million tonnes including exports achieved during the corresponding month last year. compared with October 2010, domestic consumption of cement increased this October 2011 by 5.77 per cent to 2.088 million tonnes, but the growth in sales was neutralised by a 9.71 per cent decline in exports to 856,769 tonnes. against exports of 0.529 million tonnes to afghanistan in October last year, exports declined to 0.489 million tonnes during the same month this year. exports to india though, increased substantially from 43,270 tonnes in October last year to 89,778 tonnes this October. STAFF REPORT
Profit for e-paper_Layout 1 11/4/2011 10:33 AM Page 5
Friday, 04 November, 2011
I would scrap referendum on Greece’s bailout lifeline if the conservative opposition agreed to back the package in parliament
news
George Papandreou, Greek PM
Greek leader signals he may ditch referendum plan AthenS
P
REuTERS
RiMe Minister George Papandreou said on Thursday he would scrap a referendum on Greece's bailout lifeline if the conservative opposition agreed to back the package in parliament. events in athens gathered speed a day after Papandreou held a bruising meeting in France with German and French leaders, who told him athens would not receive a cent more in aid until it voted to meet its commitments under the bailout deal. "i will be glad even if we don't go to a referendum, which was never a purpose in itself. i'm glad that all this discussion has at least brought a lot of people back to their senses," he said in the text of a speech to his cabinet released to media. "if the opposition comes to the table to back the bailout, a referendum is not needed. Both the conservative opposition and some lawmakers within Papandreou's socialist party PaSOK demanded some kind of unity government which would push through parliament the 130 billion euro rescue, Greece's last financial lifeline. Under intense pressure at home and also from the leaders of Germany and France, Papandreou softened his insistence that the Greek people should decide in a referendum on whether to accept the bailout, which also demands yet more austerity. conservative leader antonis Sama-
ras led calls for a new government. "i'm asking for the formation of a temporary, transitional government with an exclusive mandate to immediately hold elections. and the ratification of the bailout deal from the current parliament," he said in a statement. Papandreou responded by welcoming the decision by Samaras to drop his previous opposition to the bailout package, which euro zone leaders agreed only last week as they tried to prevent the bloc's debt crisis running out of control.
WIDER CONSENSUS
Papandreou reiterated that Greece's euro zone membership was not in question and that heading to elections immediately would entail a big risk of the country going bankrupt. Greeks have fiercely opposed the spending cuts, tax rises and job losses which have been the price of financial aid from the iMF and european Union to tackle its huge debt and budget deficit. This has led to a wave of strikes and outbreaks of violence on the streets of athens. a spokesman for the new Democracy party said a transitional government should not be composed of party politicians. He declined to elaborate. However, the idea appeared to be gaining ground within Papandreou's own socialist party PaSOK. a small group of senior PaSOK lawmakers are preparing a proposal for a coalition government headed by former european central Bank vice President lucas Papademos, a Greek, party sources told Reuters. Government officials said Papandreou, who also called a vote of confi-
05
tDaP extends support to uae expo in Karachi KARAChI STAFF REPORT
the Greek stock exchange rose 5 percent on speculation the referendum would be abandoned, with the index of bank shares soaring 15 percent. world stocks as measured by MSCi gained 0.9pc after earlier being sharply lower dence in his government for Friday, was not resigning and would await the result of the talks with new Democracy. "There is no resignation by the prime minister. He will speak, as scheduled, in parliament later on Thursday," one official told Reuters. Finance Minister evangelos venizelos broke ranks with Papandreou, coming out against holding the referendum after the meeting with the German and French leaders.
"REFERENDUM IS DEAD"
chaos over Greece's role in the euro zone swept financial markets with early losses in stocks and the euro turning to gains on hopes athens might ditch its referendum plans. The Greek stock exchange rose 5 percent on speculation the referendum would be abandoned, with the index of bank shares soaring 15 percent. World stocks as measured by MSci gained 0.9 percent after earlier being sharply lower. in europe, the FTSeurofirst 300 lost 1 percent initially but later stood close to 1 percent higher. earlier, Japan's nikkei closed down 2.2 percent. "The referendum is dead," Greek
ruling party lawmaker nikos Salayannis said on state radio. One PaSOK lawmaker said she would not support the government in the parliamentary vote of confidence on Friday, cutting its majority for that vote to just one. PaSOK has 152 deputies in the 300-member parliament. lawmaker eva Kaili announced she would stay in the party but refused to support the government in the confidence vote expected late on Friday, meaning Papandreou could count at most on the support of 151 deputies. venizelos, one of the most powerful men in the PaSOK government, originally supported Papandreou's plan. His change of mind came after he and Papandreou attended the emergency summit in cannes on Wednesday with Merkel and Sarkozy. a finance ministry source told Reuters on condition of anonymity that venizelos believed the vote on the bailout, which was agreed by euro zone leaders only last week, should not be held while immediate funding to keep Greece afloat still had to be secured.
c
HieF executive Trade Development authority, Tariq Puri, extended the full support of TDaP to the Minister for Foreign Trade of Uae, Ms Sheikha lubna Bint Khalid al Qasimi, in holding of first ever Uae’s Magnificent 7 expo being organized by consulate General of Uae at Karachi expo center from 30 november to 2 December 2011. The call on meeting of Puri, with the Minister Foreign Trade, Sheikha lubna, took place on the occasion of Rice international conference and exhibition (Rice) currently being held in Dubai where the TDaP has set up a Pakistan pavilion. Puri, briefed her about the TDaP’s proposal for the establishment of a Pakistan Display and exhibition center at Sharjah for which the Uae government is supporting TDaP. The Minister Foreign Trade, appreciated the proposal and stated that establishment of Display center will indeed help in boosting the marketing efforts for Pakistan’s quality products by providing a platform for reaching out to a larger number of foreign buyers. Shaikha lubna proposed that the agreement on Pakistan’s Display and exhibition center could be signed during the upcoming Uae expo in Karachi where both the Ministers of Trade and commerce will be present. Tariq Puri appraised the Minister about the initiatives of the TDaP/Moc in propagating the need for value addition, especially in the agriculture products. He stated that the Uae is regarded as a market offering immense opportunities for Pakistani exporters, which can be availed through positioning their products by value addition and right packaging.
CORPORATE CORNER SaP world tour brings competitive business solutions for Pak market
poverty alleviation and women empowerment considering its efficiency, technology based operations and transparency; the programme ought to be replicated in other countries of the world as well. PRESS RELEASE
Cathay Pacific begins taking delivery of boeing 747-8 freighters
KARAcHi: SaP unveils solutions that will drive business competitiveness which were presented at the 2011 World Tour held at a local hotel in Pakistan. The business event gathered many of the country’s key large enterprises to come together and share best practices in harnessing the power of business intelligence to help keep up with the changing business landscape. SaP World Tour stops in Pakistan, after equally successful World Tours in Singapore, indonesia, Thailand, Malaysia, etc in South east asia. The SaP World Tour offers customers and partners throughout the world a local event to help firms run better. commenting on the occasion, nitin Gangla Head of indirect Business for South east asia and emerging Markets said; “We must embrace change. The key is to evolve and transform with the times. PRESS RELEASE
Farzana raja seeks int’l support for achievement of biSP’s objectives iSLAMABAD: Mr. Michal Rutkowski, Director Human Development South asian Region, World Bank, said during a meeting at BiSP Secretariat with Federal Minister and chairperson BiSP, Madam Farzana Raja that the Benazir income Support Programme (BiSP) has proved to be a highly effective programme for
HOng KOng: cathay Pacific airways has begun taking delivery of its new fleet of Boeing 747-8 Freighters, with the first arriving in Hong Kong today. The airline will receive a total of 10 of the new-generation aircraft – the world’s largest commercial air freighter – with four being delivered by the end of this year. commenting on the new arrival, cathay Pacific Director cargo nick Rhodes said: “cargo is a very important part of cathay Pacific’s business. These new aircraft will play an important role in our continued efforts to develop Hong Kong as a leading international air cargo hub.” With the arrival of the first Boeing 747-8F, cathay Pacific will operate a fleet of 21 wide-body freighters serving more than 40 destinations. The airline also carries cargo in the bellies of its passenger aircraft, connecting to some 150 destinations around the world. PRESS RELEASE
tCP issues Gallop tender notice for local purchase of 200,000 Mt sugar KARAcHi: in pursuance of the Government directives, Trading corporation Pakistan (TcP) has issued a Gallop Tender notice for purchase of 200,000 MT Sugar, to be opened on Saturday, the 12th november, 2011. The bids have been invited in sealed envelops for a minimum quantity of 5,000MT and maximum 20,000 MT white sugar packed in polypropylene woven sacks, as per detailed specification/requirements and PSQca approved standards as mentioned in the tender
documents, form the mills who are member of PSMa. PRESS RELEASE
ufone amplifies the groove with the launch of HtC Salsa islamabad: Ufone proudly launched yet another handset for the first time in the Pakistani market. The HTc Salsa is an exceptionally engineered android device with a stylish uni-body design. as always Ufone is offering the customers something extra in the form of functional and stylish accessories to ensure that the customers get the best value for their money. Speaking on the launch, akbar Khan, Ufone’s chief Marketing Officer said that Ufone has the distinction of introducing the most stylish and technologically advanced handsets in the market at a frequent pace. PRESS RELEASE
PtCl wins global SaMena award 2011 for ‘best telecom operator in South asia’ iSLAMABAD: Pakistan Telecommunications company limited (PTcl) has won the prestigious international SaMena award 2011 for being the “Best Telecom Operator in South asia”. ceO and President PTcl, Mr. Walid irshaid, accepted this acclaimed honour on behalf of his company at the annual SaMena ‘convergence to Doha’ summit. PTcl has been “quickest to offer new products and services, and is a provider of Triple-Play, QuadPlay, 3G and advanced value-added Service (vaS),” read SaMena’s official citation for the award. PRESS RELEASE
PSo board approves recruitment and promotion policy KARAcHi: The Board of Management (BoM) of Pakistan State Oil (PSO) in its recent board
meeting ratified the “Uniform Recruitment and Promotion Policy” that has been formulated by the Ministry of for all companies that fall under its administrative control. This will help promulgate a consistent human resource policy in all public sector oil and gas companies. it will also help streamline the promotion processes in the companies which fall under the umbrella of the Ministry of Petroleum and natural Resources. PRESS RELEASE
NEW dELhI: Alan Rutherford, Chairman and World President International Advertising Association along with dkfm Eric h buxbaum VP and Area director Europe, IAA with Sohail Kisat, President and CEO MCOM and Mrs Fatima Kisat, Executive director Media, MCOM. PRESS RELEASE
ISLAMAbAd: Editor in Chief and CEO Online Int’l News Network, Mohsin J baig and Chief Asia Editor AFP, Phil Chetwynd signing an agreement to launch AFP/Online urdu Service, the first of its kind in the world. PRESS RELEASE
Profit for e-paper_Layout 1 11/4/2011 10:34 AM Page 6
Friday, 04 November, 2011
06 Markets top 10 sectors
52% 09% 10% 05% 07%
chemicals
01% 02% 02% 10% 01%
food producers
construction & materials electricity banks
fixed line telecommunication
oil & gas
financial services
personal goods
general Industrials
STOCK MARKET HIGHLIGHTS Index 11807.46 3152.8 2550.54
kse-100 lse-25 Ise-10
change +61.37 + 3.98 +40.22
volume 51,154,603 726,536 7,200
market value 3,228,765,830 66,269,390 640,780
Major Gainers company colgate palmolive millat tractors ltd. attock petroleum wyeth pak limited engro corporation
open 534.83 387.40 422.58 672.34 123.99
high 561.00 406.77 439.69 681.00 130.18
low 561.00 389.10 424.00 677.00 124.29
close 561.00 399.12 433.56 679.40 130.18
change 26.17 11.72 10.98 7.06 6.19
turnover 60 54,957 206,567 94 5,468,641
5800.00 2650.00 837.00 3224.00 180.00
5560.61 2600.00 758.02 3200.00 174.00
5611.34 2607.67 775.00 3200.0 174.00
-121.66 -95.16 22.90 -10.00 -4.02
104 39 1,197 213 1,183
Major Losers unilever pak ltd. rafhan product bata (pak) ltd. nestle pakistan al-ghazi tractors
top 5 perForMers sector wise SyMbol
oPen
HiGH
low Current
CHanGe
voluMe
404.69 120.40 6.98 93.80 334.90
396.00 116.10 6.75 89.30 308.94
396.87 117.57 6.77 92.03 310.82
-6.98 -1.21 -0.12 1.02 -14.37
61,485 833,559 399,510 91,674 314,938
15.00 31.05 71.99 143.49 40.80
14.00 29.29 65.17 137.50 37.06
15.00 29.30 70.64 139.79 37.39
0.00 -1.53 2.05 -0.90 -1.57
1,500 2,485,646 855 4,017 244,529
Oil and Gas attock petroleumXd attock ref.Xd byco petroleum mari gas co.Xb national ref.Xd
403.85 118.78 6.89 91.01 325.19
agritech ltd. arif habib coXdXb sd biafo IndustriesXd clariant pakistan dawood hercules
15.00 30.83 68.59 140.69 38.96
fatima fert.co. engro corp fauji fertilizer jah.sidd. co. d.g.k.cement
25.01 123.99 180.92 5.46 20.98
25.35 130.18 183.25 6.05 21.70
23.80 124.29 175.78 5.50 21.06
23.97 130.18 180.51 5.83 21.55
-1.04 6.19 -0.41 0.37 0.57
12,908,740 5,468,641 5,122,581 5,009,739 4,122,260
Bullion Market gold 24k gold 22k silver (tezabi) silver (thobi)
per tola (pkr) 57,139.07 51,608.00 1,11600 1025.00
per 10 gm (pkr) 49,039.59 44,245.00 958.00 880.00
per ounce us$ 1,752.00 – 33.00 –
Interbank Rates us dollar uk pound japanese yen euro
24.70 1.50 9.00 35.00 11.52
23.25 1.41 8.60 34.00 11.00
23.59 1.45 9.00 34.50 11.00
-0.31 0.00 0.07 -0.48 -0.56
40,885 8,285 3,035 25,300 63,850
al-abbas cement attock cementXd berger paints bestway cement cherat cement
2.00 51.11 11.79 8.11 7.66
2.00 51.99 12.00 9.11 8.19
1.90 50.81 11.60 8.11 7.50
1.92 51.02 11.91 8.11 8.01
-0.08 -0.09 0.12 0.00 0.35
26,799 108,952 4,762 100 197,042
29.62 2.49 41.17 7.72 22.00
buy 86.25 118.08 136.94 1.0933 84.32 10.89 23.33 22.80
sell 86.95 120.10 139.18 1.1137 88.05 11.19 23.64 23.14
Brent Crude Oil
$109.34
6.93 184.30 28.50 7.00 108.00
30.40 3.25 42.00 7.95 22.00
28.14 2.21 39.12 7.01 20.95
28.14 3.08 39.60 7.65 22.00
-1.48 0.59 -1.57 -0.07 0.00
14,022 614,084 16,802 993 70
58.00 169.52 117.00 2.63 168.53
7.90 184.30 28.50 6.90 108.00
6.93 184.30 28.25 6.25 102.60
6.93 184.30 28.26 6.70 108.00
0.00 0.00 -0.24 -0.30 0.00
10 90 5,055 5,004 2
58.00 170.00 118.00 2.79 169.99
58.00 168.50 117.00 2.43 168.53
58.00 168.94 117.94 2.51 168.53
0.00 -0.58 0.94 -0.12 0.00
2,000 240 302 39,802 31
Beverages murree brewery co. shezan Int’l
8.00 1.75 23.52 28.10 11.58
8.00 1.75 23.90 28.50 11.70
110.49 111.43 150.02 150.00
(colony) thal al-Qadir textile amtex limited annoor textile artistic denim Xd
1.70 11.25 1.67 13.00 18.50
1.11 11.25 1.70 14.00 18.50
ahcl-nov ahcl-oct anl-oct atrl-nov atrl-oct
31.00 30.82 4.01 120.42 119.16
31.00 30.82 4.25 121.50 120.30
abbott laboratories ferozsons (lab) ltd. glaxosmithkline pak. highnoon (lab) Ibl healthcare Xd
102.49 80.00 68.92 28.09 10.92
103.00 80.00 68.26 28.09 11.92
109.00 111.18 145.05 145.58
p.t.c.l.a pak datacom ltdXd telecard limited wateen telecom ltd worldcall telecom
10.89 35.03 0.95 .68 1.13
10.98 34.01 1.00 1.70 1.19
0.69 -4.44
1,170 203
p.t.c.l.a pak datacom ltd. telecard limited wateen telecom ltd worldcall telecom
11.47 31.65 1.09 1.51 1.32
8.00 1.74 22.54 27.88 11.50
0.00 -0.01 -0.98 -0.22 -0.08
53 23,501 91,748 70,820 2,995
1.11 11.25 1.45 14.00 18.25
1.11 11.25 1.60 14.00 18.49
-0.59 0.00 -0.07 1.00 -0.01
1,000 500 132,822 1,000 1,049
29.45 29.28 3.90 117.90 116.50
29.51 29.32 3.95 119.21 117.71
-1.49 -1.50 -0.06 -1.21 -1.45
376,500 516,500 24,500 201,000 200,000
101.00 78.10 67.01 27.65 10.99
102.10 80.00 68.06 28.09 11.92
-0.39 0.00 -0.86 0.00 1.00
1,283 45 1,557 100 25,154
10.71 34.01 0.90 1.65 1.06
-0.18 -1.02 -0.05 -0.03 -0.07
470,873 500 68,502 152,954 235,458
10.65 34.01 0.90 1.52 1.00
11.77 32.66 1.09 1.68 1.35
11.42 31.65 1.01 1.47 1.15
11.64 32.66 1.03 1.50 1.28
0.17 1.01 -0.06 -0.01 -0.04
4,752,418 1,430 194,249 449,333 649,632
0.50 36.38 0.75 1.70 41.36
0.50 36.50 0.77 1.70 41.80
0.36 36.10 0.70 1.56 41.25
0.50 36.10 0.71 1.60 41.53
0.00 -0.28 -0.04 -0.10 0.17
1 1,022,035 38,682 752,756 220,355
63.16 11.15 5.94 11.15 29.95
64.00 11.29 6.08 11.35 30.20
62.50 10.75 5.79 10.70 29.55
62.69 10.89 5.83 10.89 29.91
-0.47 -0.26 -0.11 -0.26 -0.04
32,694 944,906 319,287 1,929,563 175,090
Electricity genertech hub power co.Xd japan power k.e.s.c. Xr kot addu powerXd
Banks allied bank ltd askari bank b.o.punjab bank al-falah bank al-habib
SyMbol
oPen
HiGH
low Current
CHanGe
voluMe
Non Life Insurance 7.00 1.70 22.50 27.50 11.50
Fixed Line Telecommunication
Automobile and Parts agriautos Indus.Xd atlas battery ltd. atlas honda ltd. dewan motors exide (pak)
abdullah shah colony sugar mills engro foods ltd. habib sugar mills habib-adm ltd.Xd
Pharma and Bio Tech
General Industrials cherat packagingXd ecopack ltd ghani glass ltdXd macpac films merit pack
voluMe
Future Contracts
Construction and Materials
ados pakistan al-ghazi tractors bolan castingXd ghandhara Ind. hinopak motor
International Oil Price WTI Crude Oil
$92.84
23.90 1.45 8.93 34.98 11.56
CHanGe
Personal Goods
Industrial Engineering
86.1405 137.6956 1.1038 118.7016
us dollar euro great britain pound japanese yen canadian dollar hong kong dollar uae dirham saudi riyal
crescent steel dost steels ltd. huffaz seamless pipe Int. Ind.ltd. Inter.steel ltd.
low Current
Household Goods
Industrial metals and Mining Volume Leaders
HiGH
Food Producers
Chemicals
5733.00 2702.83 797.90 3210.00 178.02
oPen
SyMbol
adamjee Ins Xd ask.gen.Insurance atlas Insurance central Ins co. century Insurance
49.64 8.50 34.49 48.67 7.16
49.50 8.50 35.00 50.00 7.50
48.60 8.10 33.86 48.00 7.06
49.40 8.47 33.99 49.79 7.50
-0.24 -0.03 -0.50 1.12 0.34
6,785 1,651 1,110 3,909 1,500
13.50 1.40 65.53
14.50 1.40 65.53
0.00 0.00 0.00
2 1 157
0.30 14.89 17.71 0.86 7.25
-0.02 -1.00 -0.25 -0.02 -0.01
9,463 13,487 19,659 9,495 2,100
Life Insurance american life east west life assur efu life assur
14.50 1.40 65.53
14.50 2.34 68.80
Financial Services amZ ventures a arif habib InvesXd arif habib ltd. dawood equities Invest & fin.sec.
0.32 15.89 17.96 0.88 7.26
0.35 15.50 18.34 1.09 7.26
0.22 14.89 17.20 0.86 7.25
Equity Investment Instruments 1st.fid.leasing mod 1.70 3.98 al-noor modarXd allied rentalmodXdXb 19.90 atlas fund of fund 6.00 b.f.modarabaXd 5.56
1.50 4.00 19.90 6.10 5.56
1.50 3.60 19.88 5.90 5.00
1.50 4.00 19.90 5.90 5.56
-0.20 0.02 0.00 -0.10 0.00
15,000 25,100 3,700 414,000 7
32.68 16.01 65.55 1.67 71.00 112.81 23.34 4.22 12.05 8.52 133.00 29.15 16.48 1.82 17.55 20.22 1.06 69.00 1.70 11.00 2.60
32.68 16.03 69.29 1.70 71.00 112.81 24.56 4.35 13.00 8.54 140.00 29.85 16.49 2.00 17.93 20.40 1.06 69.30 1.80 11.51 2.60
-1.72 -0.07 0.29 -0.02 -1.31 0.00 0.00 -0.04 0.00 0.00 0.00 0.00 0.01 0.00 -0.24 -0.37 -0.19 0.20 -0.01 0.46 0.00
2,103 1,111 1,622 257,863 3,138 2 211 27,486 14 1,949 1 2 1,500 10,135 8,267 10,729 1,994 2,100 261,369 278,624 200
Miscellaneous pakistan cables p.n.s.c.Xd pak.Int.con. sd trg pakistan ltd. murree breweryXdXb shezan Inter.Xd al-abid silk mills pak elektron ltd. singer pakistan tariq glassXd philip morris pak. shifa Int.hosp.Xd hum network Xd p.I.a.c.(a) sui north gasXdXb sui south gasXdXb east west life assur efu life assur pace (pak) ltd. netsol technologies pak telephone
34.40 16.10 69.00 1.72 72.31 112.81 24.56 4.39 13.00 8.54 140.00 29.85 16.48 2.00 18.17 20.77 1.25 69.10 1.81 11.05 2.60
32.75 16.75 70.00 1.79 72.20 115.00 24.56 4.35 13.00 8.70 140.00 30.97 16.49 2.14 18.20 20.80 1.06 69.30 1.89 11.65 2.63
Mutual Funds Fund alfalah ghp cash fund askari Islamic asset allocation fund askari Islamic Income fund askari sovereign cash fund atlas Income fund atlas Islamic Income fund atlas money market fund atlas stock market fund crosby dragon fund
offer 501.2900 114.7196 103.6501 100.6900 519.3500 519.0900 516.9700 453.1500 82.9800
repurchase 501.2900 111.8516 102.6136 100.6900 514.2100 513.9500 516.9700 444.2600 81.3500
nav 501.2900 111.8516 102.6136 100.6900 514.2100 513.9500 516.9700 444.2600 81.3500
Fund hbl money market fund hbl multi asset fund hbl stock fund IgI Income fund IgI stock fund js principal secure fund I js principal secure fund II kasb cash fund lakson equity fund
offer 100.2768 87.0103 97.6745 101.8987 112.3545 121.5000 104.1200 0.0000 106.3763
repurchase 100.2768 85.3042 95.2922 100.8898 109.6141 111.5200 96.5000 0.0000 103.2779
nav 100.2768 85.3042 95.2922 100.8898 109.6141 117.3900 101.5800 100.1087 103.2779
Profit for e-paper_Layout 1 11/4/2011 10:34 AM Page 7
Friday, 04 November, 2011
closing bell
bOONdOCKS
aries
taurus
gemini
You need to make the most of what you've got today -- and that most likely means helping others out. If you're not sure whether or not they really need you, go for it anyway -- why not?
Now is the time to try for big, crazy ideas and plans -you never know what might go right! It's a good time for you to make sure that your energy is spent on whatever feels most important.
Your creative side is dominant today, so squeeze every last drop of artistic and intellectual juice out of it! You may find it hard to actually get to work on anything, so dream up plans for the future instead.
cancer
leo
Virgo
Focus your energy outward today -- you need to show the world what you've got to offer. It's easier than usual for you to make a real difference, but you've got to start as early as you can.
Today is all about art. Even if you don't feel creative in any way, shape or form, you can still get out there and enjoy what the creative types have to offer -- or take in a sunset, for that matter!
Say no to anything new today unless you've got absolutely everything else cleared off your plate -- stuff you start today is highly likely to expand far beyond its original scope.
libra
scorpio
sagittarius
People in your life need help -though it's not exactly life-and-death. Someone might need help with their look, or with the design of a project of some personal importance. Your advice is keen.
Your energy is almost fully invested in your subconscious life right now, so make sure you're making the most of it. Someone close is pretty sure that you're a prophet of some kind.
Everything that happens today seems more meaningful to you -but that doesn't mean you're taking an active role. In fact, you may just be sitting back and observing, reflecting on what it all means to you.
capricorn
aQuarius
pisces
Your right brain is hyperactive today -- but it's not distracting you. In fact, it's giving you some serious clues as to your surroundings and the people who most confuse you. Pay attention!
Can you focus today? The odds are not really on your side, but you still might be able to get a bit of work done. Expect major sidetracks, especially later in the day as weird details start to pile up.
Now is your big chance! It's a good time for you to rethink the way you do things -- or even how you see yourself! Life can be really great if you just open up and let your energy flow.
CROSSWORd
CMYK
SudOKu
bRIdGE
hOW TO PLAy fill in all the squares in the grid so that each row, column and each of the squares contains all the digits. the object is to insert the numbers in the boxes to satisfy only one condition: each row, column and 3x3 box must contain the digits 1 through 9 exactly once.
beach boost capital clinic crazy date dread drill drink elegance factor force gallop handsome joust ladder laugh leaf lens litmus lottery lumber
nation nicotine orange pact pant pastor peach rancid riotous search sect sham side slab slat slip tart teller toll trash turmoil
Today’s soluTions
AN INTuITIVE SKILL
ChESS White to play: play and mate in 4 moves 8 7 6 5 4 3 2 1 A
B
C
D
E
F
G
H
CMYK
chess solution
2. Gawk at 3. Crummy 4. A liquid fuel 5. Lunatic 6. Assist 7. Canine 8. Affirm 9. Prefix meaning "After" or "beyond" 10. Payola 11. birth-related 12. Ancient Greek marketplace 13. Merchandise 19. Angered 21. Neuter 25. detail 26. No more than 27. Confined 28. A low evergreen shrub 29. Almost 40 inches 30. Muse of love poetry 31. zero 34. Wise men 35. dogfish 36. After-bath powder 38. Coxcomb 39. A type of bacterium 41. A stone craftsman 42. Sediment 44. delicate 45. Patter 46. Easy to use 47. Playful aquatic animal 48. Lying facedown 51. Stow, as cargo 52. Render senseless 53. Farm soil 54. Chamber 55. Countertenor 56. A source of seepage 58. Frozen water
WORd SEARCh
2.Rh5+ Kg7 4.bf8# 1-0
1. burden
bALdO
1.qxh7+ Kxh7 3.bh6+ Kh8
DOWN
GARFIELd
sudoku solution
1. deadbolt 5. A woman of refinement 10. Chew on 14. Monster 15. Not below 16. Indian music 17. Winged 18. Go-between 20. Put into a bank account 22. Armed combat 23. Resort 24. Collection of maps 25. A charge of misconduct in office 32. Minuscule 33. Strange 34. Welcome ___ 37. Coastal raptor 38. deadly 39. Tibetan monk 40. Encountered 41. Choral work 42. A seal 43. Excitant 45. Stores 49. Computer key 50. Guards 53. Not figurative 57. Chanting 59. Part portrayed 60. biblical garden 61. Old gold coin 62. bit 63. Stringed instrument 64. Foe 65. berserk
dILbERT
crossword solution
ACROSS
07
Profit for e-paper_Layout 1 11/4/2011 10:34 AM Page 8
Friday, 04 November, 2011
it is confirmed that Pakistan has given the most favoured nation status to india and granting new status to the neighbouring country will not affect the domestic industry
news
08 Business community speaks out on the MFN issue
Secretary Commerce Zafar Mehmood
g
Pakistan to continue trade with india under positive list g india will not oppose eu package to Pakistan on november 7 KARAChI\LAhoRe
P
GhuLAM AbbAS, IMRAN AdNAN
aKiSTan will continue its trade with india under the existing positives list of trade as the process of evaluation of the impact of trade liberalisation on domestic industry has not been completed.
SalvaGinG DoMeStiC inDuStry
“it is confirmed that Pakistan has given the most favoured nation status to india and granting new status to the neighbouring country will not affect the domestic industry,” said Zafar Mehmood Secretary commerce Zafar mehmood in a meeting with the members of Karachi chamber of commerce and industry (Kcci) here on Thursday. He had visited the chamber to discuss the matters of trade with india and proposed “negative list”. “as the cabinet has approved the fresh move of granting MFn to india, Delhi will also not oppose the european Union unilateral trade concession package to Pakistan in the forthcoming meeting of World Trade Organisation (WTO) scheduled to be held on november 7, 2011,” he added. Both the countries are committed to implement the joint declaration made during the previous meeting between the two commerce ministers in Delhi, he said; adding that the two neighbouring countries of South asia have decided to move forward for strengthening trade ties. AcHiEving cOnSEnSuS: Talking about the fresh decision of moving from the negatives list of trade to the positives list, the secretary commerce said that as the process was yet to be completed with the consensus of all sectors, the government has temporarily decided to continue trading on the bases of the existing positive list. He was of the view that granting the MFn status to the neighbouring country will not harm indigenous industries or sectors as there is still room to protect domestic products. For MFn, he said that technically there should be no negatives list, however he explained that they would examine the proposals of a probable harm to the domestic industry and the problems would be overcome in a scientific manner, keeping the WTO legal framework under consideration. “The government can impose high tariffs and other duties to protect the domestic market after trade liberalisation,” Mehmood added. “in the modern world regional trade has become very important and through strengthening economic ties within the region Pakistan comparatively can move towards more economic development,” he added. as the ministry is in direct contacts with various chambers of commerce and trade bodies, every step would be taken in the best interest of the country and its industry. The ministry would definitely protect the country’s own industry.
FoSterinG reGional traDe On the other hand President, Kcci Mian abrar ahmad, has urged to foster the process of regional trade and economic cooperation between Pakistan and india to bring peace and prosperity in the remIan abrar gion. in his welcome address to commerce Secretary he said, ”We can change our friends but cannot change bordering neighbours so Kcci, firmly believes that both the countries will have to demonstrate greater political will to foster relations.” He said that it is a misconception that opening up trade with india will bring net losses to Pakistan. a win-win situation needs to be created to explore untapped potential, which is enormous and estimated at around $10 billion as compared with the current level of trade of only $2.5 billion. President Kcci was of the view that constraints on economic integration including high tariff and non tariff
barriers, inadequate infrastructure, bureaucratic inertia held back trade between the two countries. Mian abrar stated, “at Kcci, we believe that the issue of granting MFn status to india needs to be realised as an economic obligation instead of a political framework and india should come forward with an open mind to promote bilateral investment and deepen economic relations. india should oblige the commitment to support Pakistan for accomplishing GSP plus in european Union as Pakistan has offered MFn to india.”
FaCilitatinG buSineSS CoMMunity chairman Businessmen Group Siraj Kassam Teli said, “Since 2004, we at Kcci opine that MFn should be granted to india, a step that would be beneficial for both countries.” He explained that he led sIraj kassam telI the Kcci delegation to india in the year 2004 which received overwhelming response from the indian Government and Private Sector. Several meetings with important indian dignitaries and counterparts were held and various MoUs were also signed, however, due to visa and trade barriers the said MoUs could not be implemented. He also urged the commerce Secretary to support BombayKarachi Joint chamber of commerce and industry to facilitate business communities of two countries.
beneFitS oF MFn ZUBaiR MOTiWala stated that the benefits of MFn between india and Pakistan must be passed in the real sense while political and economic relations must be segregated. He stressed upon the need of ZubaIr motIwala more cBMs between the two Governments with a focus on long term objectives. He urged the immediate resolution of non-Tariff Barriers. He said that the negative list from india should be shared with Kcci. REActiOnS Of BuSinESS cOMMunity in LAHORE: The Business and trade community in lahore has been divided on granting Most Favoured nation (MFn) status to india. Farmers, pharmaceutical manufacturers and traders are against the decision, while textile, information technology, lahore chamber of commerce and industry are in the favour of MFn status to india. However, all business leaders in the country are of the view that the government should press india to remove non-tariff barriers (nTBs) and provide a level playing field to Pakistani products.
teXtile PerSPeCtive all Pakistan Textile Mills association (aPTMa) chairman Mohsin aziz said that aPTMa welcomed the MFn status to india as it would help in normalising trade relations between the two neighbouring countries. However, mohsIn aZIZ he urged the indian government to remove non-tariff barriers (nTBs) to make MFn status a success for Pakistan too. Statistics show, he pointed out, that trade between the two countries was $1.4 billion in 2009-10, of which indian exports to Pakistan stood at $1.2 billion, while Pakistan exports to india were merely $268 million. it clearly indicated that india had not opened up its market for Pakistani goods, he maintained. He underlined that
despite the MFn status from india to Pakistan since 1996 nTBs have hampered attempts of increasing trade volumes from Pakistan to india. On the contrary, there was hardly any nTB against indian goods in Pakistan despite non-granting of MFn status to india.
CHaMber oF CoMMerCe PerSPeCtive lahore chamber of commerce and industry (lcci) has also appreciated the Federal cabinet’s decision to grant MFn status to india but urged the government to take pharmaceutical, automobile, motorcycle, petrochemical, auIrfan QaIser toparts, sugar, textile, cooking oil and ghee industries on board before signing the MFn treaty document with india. Speaking to Profit, lcci President irfan Qaiser Sheikh said, “lcci had always advocated regional trade, especially with india for the sake of peace and prosperity in the region. However, the MFn status should not be granted at the cost of the domestic industry. The government should take business community in to confidence before signing the MFn treaty with india.” He was also of the view that the government should take up the nTBs issues with the indian government so that both the sides had a level playing field to do business with each other. He said bilateral trade between the two countries could boost the economies of both countries, if customs procedures were harmonised. tHE AgRicuLtuRE pERSpEctivE: agriForum Pakistan chairman ibrahim Mughal stated, “The MFn status to india would badly hit Pakistani agriculture. curtailing water by india is an attempt to convert Pakistan into a desert and wants to sell its fruits and vegetables in Pakistani markets. Bilateral trade between the two countries should be on the basis of equality.” Figures show that india was giving around Rs812 billion subsidy to its farmers to reduce their production, whereas Pakistan was hardly spending Rs8 billion on that account. india’s agriculture production cost was around two to three times lower than Pakistan due to these subsidies, he maintained.
PHarMaCeutiCal PerSPeCtive PaKiSTan Pharmaceutical Manufacturers association (PPMa) Former chairman Khawaja Shahzeb akram said “The decision would compromise the viability of domestic pharmaceutical industry. local indusshahZeb akram try is importing 99 per cent of its raw material from india and china, but once the MFn status is functional local pharma manufacturing would be out of question.”
it PerSPeCtive leaDinG iT firm Managing Director ibrahim Qureshi believes that MFn status to india would help flourish the domestic iT industry in the country. He pointed out that Pakistan could benefit from the iT experiIbrahIm QureshI ence of india as india had tremendous software exports. in addition the decision would help the domestic iT industry in establishing business to business relationships. However, he urged the government that before moving forward bilateral trade modalities should be finalised so that domestic industry could enjoy a level playing field.
Fbr issues guidelines for broadening tax base ISLAMABAD STAFF REPORT
F
eDeRal Board of Revenue (FBR) on Thursday by pointing out the various shortcomings in the tax system, issued instructions to all its chief commissioners of Regional Tax Offices to improve the Broadening of Tax Base (BTB) campaign for the achievement of BTB targets. FBR, in a letter sent to all field offices, has pointed out various causes of BTB campaign not getting its due importance due to factors including poor logistic support to the BTB units, lack of ownership of the initiative, incomplete regional databases, Human Resource weaknesses and inadequate iT infrastructure crucial to achieve their full potential. The chief commissioners were asked to own the BTB initiative and to shoulder the responsibility of this key objective. it recommends evaluation and subsequent strengthening of existing physical and human resources, allocating the best resources and establishing new structure of BTB Zones and Ranges to achieve the 2011-12 BTB targets. Keeping in view the on-ground situation, new BTB targets (over 700000 new taxpayers) have also been assigned through the letter issued here, along with the recommended steps to achieve these targets. The steps include using withholding tax regimes as a BTB tool, taxpayers’ mapping, field surveys, tapping real estate & motor vehicle registration and other possible potential areas for BTB.The communication also elaborates steps for maximising the benefits of the BTB campaign by comprehensively expanding the tax base to cover all tax streams, iT backing of all BTB efforts helping create a databank for analysis and utilisation, and monitoring of BTB targets for each team and unit. a quarterly BTB review of performance of all RTOs is also sought, to review and modify the regional and national BTB strategy. The chief commissioners will be required to furnish their quarterly review reports in the first weeks of January, april and July and the performance of the chief commissioners would mainly be based on regional BTB performance.
Forex reserves dip to $17.146 billion KARAChI STAFF REPORT
M
ainTaininG a week-long seasawing trend, the country’s liquid foreign exchange reserves slid to $17.146 billion during the week ending on the 28th of last month. according to State Bank, the country’s dollar holdings, after last week’s slight 0.18 per cent recovery, witnessed a slump of 0.3 per cent or $63 million and accumulated to $17.146 billion against $17.202 billion of the preceding week. State Bank of Pakistan (SBP) Thursday said during the week under review the country’s total foreign exchange reserves ballooned by $7 million or 0.04 per cent to $17.209 billion compared to $17.202 billion of last week. During the week under review the central bank held $13.409 billion, down 0.2 per cent or $34 million when compared with the regulator’s last week’s holding of $13.443 billion. The foreign exchange reserves of the commercial banks, a major stimulus for the country’s overall reserves, also remained downward at $3.737 billion. This shows a decline of $ 29 million or 0.7 per cent over the last week that saw the banks’ reserves aggregating to $3.766 billion. according to SBP chief spokesman Syed Wasimmudin, such up and downs in foreign exchange reserves were because of growth in bank deposits and with drawls and routine debt repayments.