A blessing in disguise for commodity market Page 2 America should turn to Reaganomics again Page 3 Govt’s budgetary borrowing from banks crosses Rs708b Page 8 Pages: 8
profit.com.pk
Saturday, 19 November, 2011
laSt nail in the Coffin
Govt to restrict CNG consumption ISlaMaBaD
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JaLaLUDDIN RUMI
HILe the country is facing a crippling power and gas shortfall that is likely to worsen further in the coming months of winter, the government is considering to restrict the consumption of compressed natural gas (CNG) in privately used CNG fitted vehicles for six month to one year, minister for Petroleum and Natural resources dr Asim Hussain said in a meeting of National Assembly standing Committee on Finance on Friday. The ministry of Petroleum and Natural resources has sent a summary to the economic Coordination Committee (eCC) for approval to discourage consumption of CNG in private cars except CNG buses and transport vehicles used by passengers, the minister said.
minister said that Government intends to reduce the difference between prices of CNG and other fuels as there is a huge price difference between petrol and diesel that spurred people to switch to CNG. He said people need to realise that the country is facing a severe gas shortage and gas shortfall would further exacerbate in the coming days if people did not follow the gas load management plan. He said that in this year under the load management plan gas load shedding will be observed in sindh and Punjab while only 90 mmcfd gas will be provided to Quetta. However, the CNG filling station operators may react strongly to this move. CNG has a share of around 8 per cent in total gas consumption. Public transport vehicles started converting to CNG a few years ago and today a large number of small and big buses are running on this cheaper fuel.
Ban on CnG KitS
PetroleuM levy and GaS infraStruCture Bill
Hussain said that the ministry would ask the cabinet to bar car companies from fitting CNG kits in private vehicles at their manufacturing facilities. The ban would be implemented on CNG fitted imported cars, CNG kits and cylinders. The government aimed to impose a ban on CNG usage in all kinds of cars as vehicle owners could afford petrol and diesel, though they were expensive, he said.
National Assembly standing Committee on Finance also approved gas infrastructure development cess and petroleum levy bills with govt aiming for rs35 billion under the gas cess; $1b for dedicated Karachi-Lahore LNG pipeline. These levies would not be chargeable on domestic sector consumers and general public, limiting its scope to
‘Put your house in order’ PM Gilani, tells petroleum ministry ISlaMaBaD
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Staff RepoRt
rIme minister syed Yusuf raza Gilani directed the ministry of Petroleum and its concerned departments to put their house in order as the attitude of ‘business as usual‘ is unacceptable. The Pm while chairing a meeting at Pm House on Friday asked the ministry to work on war footings to ensure that people get to face minimum inconvenience due to gas shortage in the forthcoming months of November, december and January. The minister for Petroleum, dr Asim Hussain, secretary Finance, Cabinet secretary, secretary Petroleum, Acting Chairman Fbr and other senior officials of the relevant ministries were present in the meeting. The Prime minister directed the ministry of Petroleum to accelerate the process of increasing the supply of gas in the country. All
irritants in the way must be removed as of today, the Prime minister directed. The ministry of Petroleum and Natural resources briefed the meeting about various gas development projects like Iran-Pakistan gas pipeline, TurkmenistanAfghanistan- Pakistan-India gas pipeline and import of Liquefied natural gas (LNG) to overcome the shortage of gas in the country. The Prime minister directed to expedite work on these projects. He said all the concerned authorities should meet in quick succession, if need be, to evolve an operational strategy aimed at speeding up the work to overcome the energy deficiency in the country in the earliest possible time. The Prime minister also underscored the need of launching an awareness campaign to sensitise people to the imperative of energy conservation, particularly gas conservation measures in the upcoming winter to ensure maximum benefit and comfort to the people.
the companies. The senate standing Committee on Finance already approved these two bills for the imposition of gas infrastructure development cess and petroleum levy on compressed natural gas (CNG) and liquefied natural gas (LPG).
GaS CeSS, MiSuSed inStruMent NA Finance committee met under the chairmanship of Chairperson Fauzia Wahab. The committee members were of the view that historically cess has been a misused instrument, never serving the purpose it was employed for. The PPP mNA Qamar Zaman Qaira gave the example of Iqra surcharge, terming that the money collected from it have never been used for the betterment of education system in the country. Finance secretary Waqar masood assured the committee members that the funds collected from gas infrastructure cess will only be utilised on development of gas infrastructure in the country. He said that only 25 per cent people in this country are benefiting from gas while other 75 per cent people are using expensive fuel for daily use. He said government is trying to minimise the difference between different fuels and to make them realistic. He said that government is only charging 30 per cent price of gas from consumers and assured the members that gas price will be determined at 55 per cent of the petrol price.
rS35B to Be raiSed Petroleum minister dr Asim Hussain said the gas cess will create space for the federal government for infrastructure development, as it will generate rs35 billion per annum. He assured that cess and petroleum levy would only be imposed on companies that are included in the industrial and fertiliser sectors. 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. dr Asim said a few chosen people have held up opening of the LPG sector for competition. 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. He said that price of PakistanIran gas would be available round $13 to 14 per mmbTU while gas from TurkmenistanAfghanistan-Pakistan-India (TAPI) would be available at $12 to 13 per mmbTU. He said that his ministry has given the proposal to Finance division for the Fertiliser equalisation surcharge in order to maintain the urea price equal in the whole country.
Shahbaz seeks cooperation with Korea lahore
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Staff RepoRt
mbAssAdor of south Korea in Pakistan Choong Joo Choi met Punjab Chief minister muhammad shahbaz sharif here today and discussed matters of mutual interest as well as cooperation in transport, mining, hydel power and other sectors. member National Assembly Pervaiz malik, Chairman Lahore Transport Company Khawaja Ahmad Hasaan and secretary Transport were also present on the occasion. Talking to the Korean Ambassador, the Chief minister said that Pakistan has cordial relations with south Korea which has made remarkable progress in various sectors. He said that there are vast opportunities of cooperation in different sectors in Punjab and provincial government has created a favourable environment for promotion of investment where all facilities are being provided to investors under one roof. shahbaz sharif said that he visited south Korea during his last tenure and introduced a well-organised transport system for the first time in Pakistan in the form of daewoo bus service. He said that an air-conditioned CNG bus
service has recently been launched in Lahore with the cooperation of Chinese company Foton which has resulted in availability of affordable, comfortable and efficient transport services to the people. An agreement has been signed between the leading companies of Istanbul and solid Waste management for the disposal of solid waste from provincial metropolis. In addition to other foreign companies, negotiations are also being held with different Korean companies for cooperation in various sectors including bus rapid Transit system (brT) and mono rail project the chief minister said. He was of the view that Korea has expertise in transport, hydel power, mining and other sectors and it can also extend cooperation in brT and mono rail sectors in Punjab. He thanked Korean Ambassador for inviting him to Korea and said that it will be an honour for him to visit Korea. south Korean Ambassador in Pakistan Choong Joo Choi appreciated the measures taken by the Chief minister Punjab, muhammad shahbaz sharif for the development of transport and other sectors and said that Korea will increase cooperation in brT, mining, hydel power and other sectors. He also invited muhammad shahbaz sharif to visit Korea.
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Saturday, 19 November, 2011
debate
We have identified hundred points through which
US-European debt crisis: a blessing in disguise for commodity market Commodity market emerges as a reliable safe haven for investors g Commodities now being recognised world over as equal asset class g Gold prices escalated by about 700 per cent in past decade g PMeX is switching from raw to refined commodities g Price lock in futures trading at PMeX enables investors to manufacture advantageously g
ISMaIl DIlaWar
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roFIT, talks to mr samir Ahmed, md Pakistan mercantile exchange Limited to discuss the prospects of the commodity market in Pakistan.
international outlooK The individual and institutional investors took shelter in the commodity market as fear for the re-emergence of a double dip global recession, emanating from the financial centers in Us and europe, played havoc with sentiments of the riskaverse traders on the volatile equity and currency markets. samir Ahmed, managing director of Pakistan mercantile exchange Limited (PmeX), says the country’s first and only de-mutualised commodity futures exchange provides investors with a safer and transparent forum to hedge against the unpredictable market risks. The global financial negatives led by American debt ceiling and european debt crises was a sort of blessing in disguise especially for the commodity market in Pakistan which welcomed huge investment from the already volumes-starved capital market and saw the (per ounce) gold prices climbing to the historic $1800 mark. The PmeX managing director discussed these and other issues related to the commodities exchange at length in an exclusive interview with Profit.
700 Per Cent aPPreCiation in Gold About the recent hike in international gold prices, samir said gold had witnessed a 700 per cent appreciation in its prices during the past decade. “It skyrocketed from $250 to $1800 (10 grams) with 2010 and 2011 seeing a respective price hike of 29 and 30 per cent,” samir said.
reaSonS for the PriCe hiKe? The md PmeX cites two major factors. Firstly, a weakening Us dollar had tempted the central banks the world over to go for extensive buying of gold during the last couple of years. The PmeX md recalled that there was a time when the central banks used to sell on average 500 tonnes of their gold reserves every year. “The central banks are diversifying their reserves in view of the troubled Us economy and the resultant weakening of the dollar,” he said. samir said euro being a weak currency could not be an international safe haven for the risk-averse individual and institutional investors therefore turn to gold. “People are now seeing gold as a safe haven after the traditional safe heavens (like euro and dollar) came under question during the recent debt crisis,” he added.
CounterinG the inflation effeCt secondly, samir said, was the inflation factor. “Gold maintains its prices over time, making itself a big beneficiary of the ongoing financial crisis that could worsen further.”
“As an exchange we are bringing international commodity prices (be it gold, crude oil or silver) on real time basis (live) that enables the traders at PmeX to benefit from international prices,” samir said. samir said PmeX was the only licensed and regulated institution in the country where transparency of the dealing is guaranteed. “You can keep your gold in your account with us and guarantee it in the open market.” The managing director also sees the PmeX as a great platform for those willing to invest in fuel where the price volatility remains greater. “The investors could book their demands months ahead (on PmeX) where we are giving a good platform to hedge their price risk,” he said.
introduCinG aGriCultural CoMModitieS Whereas the exchange has secured the securities and exchange Commission of Pakistan’s (seCP) nod for the hedging of risk management in cotton contracts, other agri produces like wheat and maize are also in line. The PmeX, according to samir, was also planning to do some industrial metals like steel, copper and zinc in 2012. “research is underway to determine specification of the commodities.” About demutualisation of the commodity exchange, samir said demutualisation was the rare distinction of PmeX and was very helpful in avoiding the conflict of interest on the market. “From day one this exchange is demutualised and is, therefore, free of conflict of interest. The exchange is run for the benefit of all stakeholders,” he said.
2008 MarKet CraSh Asked if the equity market-like price manipulation was possible on the PmeX, samir replied in the negative, “Almost every commodity like gold, silver, crude oil is internationally traded, so there is no question of price manipulation or to say influencing the market,” the md said. Feeling pride in having a tremendous increase in trade volumes at the PmeX, samir said investors were now switching to the commodity market where the average turnover had recently hit the rs118 billion mark against the rs52 billion total portfolio of the local shares markets. “Normally, commodity markets are much larger than equity markets.” When we asked for his expert opinion regarding the local stock markets where trade volumes were depleting, samir said along with other negatives the closure of Karachi stock exchange for four months during the 2008 crash had inflicted an irreparable damage upon the investors’ confidence at the country’s largest bourse. “The setting of a floor was a silly move. You should allow the market to flourish on its own in an orderly way,” viewed samir.
deClininG voluMeS The PmeX chief said the local bourses direly needed new enlistments for seeing increased volumes. “The size of the market is not growing in terms of new enlistments. You need new companies to come for enlistment that would increase the volumes,”
MD Pakistan Mercantile Exchange Limited Samir Ahmed he said. The liquidity crunch on the stock market and other macroeconomic issues were other factors that samir said were keeping the investors at bay at Kse. regarding the Capital Gains Tax (CGT) controversy at Kse, the PmeX md said more important was the question of “how to collect the levy”. “It’s all about the comfort of the investor.” Underlining salient features of the exchange, samir said the PmeX was owned 100 per cent by institutions with National bank of Pakistan (NbP) holding 9.0 million (47.4 percent) shares, Karachi stock exchange (Kse) 3.64 million (47.4 percent), Lahore stock exchange (Lse) 2.27 million (19.2 percent), Islamabad stock exchange (Ise) 2.27 million (11.9 percent), PKIC 0.91 million (4.8 percent) and ZTbL 0.91 million (4.8 percent) shares totaling 19 million shares.
StaBility and tranSParenCy He said the PmeX ensures two things. First, the prices of listed commodities remain in check thus stable. second, a transparent futures-based trading mechanism provides the risk-averse investors with an effective risk management, also called lodging, tool that guards the investors against price volatility and the losses it incurs. “The downfall of prices does not adversely affect the investors at the commodity exchange. The price lock in futures trading enables the investor to move on with manufacturing works advantageously. similarly, the farmers may grow (their crops) as per demand,” he said. He said cotton
had been very volatile with its prices being variable across the country. “The market ensures that the prices remain discounted.” Unlike the volumes-starved stock market, the commodity market presented an impressive year on year growth of 671 per cent during the previous fiscal year, according to PmeX’s July 6th statement. In terms of volume this growth amounted to rs490.515 billion in FY11 against rs63.610 billion of FY10.
future of the CoMModity MarKet And these trading volumes would certainly go up further, as samir said; the exchange was tending to switch, in terms of enlistment, from raw commodities to refined ones. He said the exchange would be working on the prospect of ginned cotton, refined sugar and milled rice in which the millers and not the farmers would be the sellers of agri produces. “The millers and farmers would have a direct correlation, we would be working on it as soon as we mitigate some infrastructure issues,” the md said. “Commodities are now recognised world over as an equal asset class along with equity, bond and currency markets and Pakistani investors could also invest in PmeX in a transparent way,” samir said. The PmeX current product portfolio includes international commodities like gold, crude oil, silver, palm olein and domestic commodities like IrrI-6 rice Futures Contract, sugar, financial futures and KIbor futures contracts.
Saturday, 19 November, 2011
EDITORIAL
A viable system VeN if the senate standing committee on finance hasn’t exactly figured out which particular economic system it wants for the country, it is no longer in the dark about what it doesn’t want. so “anti-consumer” laissez faire will no longer do, and preferably regulated market mechanism should be revived for effective price control. There is a ring of truth in rejecting the free market economy mantra. suddenly, elected representative around the world are facing stiff public resistance to what is perhaps rightly dubbed exploitative capitalism, its fissures progressively ominous since the giant collapse of ’08. There is also considerable truth in the committee chairman’s landmark finding that the current model allows a privileged few to hold many hostage, influencing market forces and fluctuating prices at whim. but his suggestion of reviving the magistracy system to check profiteering seems betraying opposition politicking more than genuine concern for the system. For, considering our own example, it is not the system that is so
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much to blame as those toggling it. Corruption, top to bottom, compromises more resources and funds than market inefficiencies or even spill over of natural calamities. simply resorting to another form of checks and balances will not do, especially if there isn’t a more important system in place, one that checks and punishes corruption and wrongdoing. Plus, it’s just too obvious to ask the able chairman why such measures were not incorporated during his own watch as finance minister. There will be no satisfactory answer, and that’s where it’ll end. It bears noting that while the last decade or so has seen the rich-poor gap widen in even the most advanced economies, ours no longer has the cushion where government patronage and subsidies can keep masses quiet much longer. With the poor on the brink of no longer affording subsistence, the winds of change sweeping our part of the world will alter a lot more than just the market’s supply-demand mechanism. Those at the helm should take this very seriously. Yes, prices must be controlled. but it’s far more important to check inefficiencies that skew the entire system.
America should turn to Reaganomics again
Shan Saeed He financial bazooka has created havoc for the Us economy. Confidence is lacking in the Us economy which is the main driver. There is a very nice article written by my friend Lynn Forester de rothschild in Huffington Post titled restoring capitalism on November 10, 2011, sharing important insight. she stated: President obama has broken trust with the American people. Not only has he left the Americans more bitterly divided than ever imaginable, but since the beginning of his presidency, 1.3 million more Americans are unemployed, 913,000 private sector jobs have been destroyed, 13 million people have been added to food stamp dependency and over six million have lost their homes. While UsA economy needs 90,000 new jobs each month just to keep up with the national birth rate, it has reached that threshold only nine times since February 2009. All that is bad enough, but at the same time Us government has increased the debt burden from $5.8 trillion in 2008 [40.3 per cent of GdP] to over $9 trillion in 2011 [67 per cent of GdP]. And, Us annual federal government budget deficit has grown from $458 billion in 2008 to $1.7 trillion in 2011. only 19 per cent of Americans "always" or "mostly" trust the government to do what is right, down from 75 per cent in 1958. millions are fed up and are opting to "starve the beast". That is not crazy. mr President, if you can follow milton Friedman's economic insights [Nobel Laureate of 1976 from University of Chicago, UsA], you will surely see through this crisis with ease. You have taught at University of Chicago Law school and you have great regard for the school. The only way President barack obama and his economic team can solve the Us economic woes is to adopt “common-sense” reaganomics, the policy. reaganomics would fix any economy that’s in the doldrums. It’s not a magic sauce, it’s common sense. How can obama do it?...Follow these five simple steps adopted during reagan era in 1980's. step 1: The Us has got to get rid of all federal taxes in the extreme and replace them with a lowrate flat tax on business net sales, and on personal unad-
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People work to get what they can after taxes Biogas, an answer to Pakistan s energy crisis
Road to Islamic banking
bio-gas, no doubt, is an answer to the energy crises if implemented in right earnest. It is sad to say that many such projects of use of bio gas from animal faeces for domestic energy need and running of tube wells from solar energy have been tried successfully in the country side in say sixties/seventies under foreign aid/grant, but could not continue persistently due to wrong policies and rampant corruption in the government agencies. Government does everything for the elite class of society, whereas, the poor are neglected. moreover, whatever is done in this respect does not initiate at grass root level which is why the efforts remain futile.
M. aSlaM ChauDhry LahoRe
The article no doubt proposes an enlightening suggestion; now the world needs Islamic economic system and not just banking system. but by resorting to the proposal that has been given by the writer in the article, would render PTI away from its popular impression. PTI's sole objective is 'indiscriminate justice and a holy war against corruption' rather than to hold the emblem of Islam. I am sorry, but aren’t we expecting a little too much from PTI? Another question that I would to raise here is that why is Islamic banking still resorting to KIbor system, which is the corner stone of conventional banking?
ahMeD ShakIl LahoRe
justed gross income. step 2: The Us will have to have spending restraints. Government spending causes unemployment, it does not cure unemployment. Government spending has never raised the GdP. It’s the tax cut that enhances the GdP growth. empirically proven. step 3: Us needs sound money. Fed Chairman ben bernanke is running the least sound monetary policy I’ve ever heard of. markets don’t like uncertainty and chaotic moves. The Us has increased it money supply by 138.6 per cent from sept-2008 from $851 billion to dec-2010 by $2.03 trillion. Price inflation can be decreased through monetary deflation. This was advocated by Late Nobel Laureate milton Friedman in his book money mischiefepisode in monetary history. I openly admit that I follow milton Friedman – the greatest Nobel Laureate in economics of modern epoch along with Prof Gary becker at Uni. of Chicago, booth school. step 4: The Us need regulations, but they don’t need those regulations to go beyond the purpose at hand and create collateral damage. The regulatory policies are really way off here. step 5: Lastly, the Us needs free trade. Foreigners produce some things better than Americans do and Us produce some things better than foreigners. It would be foolish in the extreme if America didn’t sell them those things Us produce better than they do in exchange for those things they produce better than Us do. I think that the UsA can win its top rating back, but only when economic policies are completely turned around. However, President barack obama’s administration’s only economic plan seemed to be to expand government ownership of the means of production. Washington has nationalised the health care industry pretty extensively and is doing it with home building as well. obama tried it with the auto industry as well. so obama administration has moved very, very deliberately and purposefully toward extending government ownership of the means of production. That to me, if you read the tea leaves, is what they are doing. It is not what they are saying they are doing, but that is what they actually are doing. People don’t work to pay taxes, people work to get what they can after taxes. It’s that very private incentive that motivates them to work. If you pay people not to work and tax them if they do work, don’t be surprised if you find a lot of people not working.” Current economic woes started to form under President George W bush, but have been made worse by obama’s policies. There’s a wedge driven between wages paid and wages received and that wedge is the tax/government spending wedge. That wedge has grown dramatically in the last 4 ½ years…under W and a republican administration and…under obama. bipartisan ignorance has led America to this very disastrously desolate state. Shan Saeed is a graduate from Booth School of Business, University of Chicago, and IBA Karachi with 12 years of financial market. He Blogs at www.economistshan.blogspot.com
The case of exploding railways
Ali Rizvi e Pakistanis are a funny little nation. While the entire world blows their trivial problems out of proportion, we have been accustomed to burying the most gargantuan problems into the depths of obscurity. While the royal family of Louis the XIV was accused of not being privy to the misery of the masses, with one of their queens rendering the infamous statement, ‘well if they don’t have bread, they can eat cake instead’, the Pakistani figures that have infested the cor-
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ridors of power are often heard making similar statements. “If you don’t have railways, use buses instead,” or something similar was echoed by Pakistan’s railway minister Haji Ghulam Ahmed bilour, who ironically is a transporter by profession. Now if any self interested businessmen are reading this, they will understand that capitalism is all about maximising profits. It really doesn’t need a rocket scientist to decipher the link between the shut down of railways and profit maximisation of the private transporters, our honourable minister being one of them. It needs a death to shake our worthy government from its deep slumber. Therefore, we pay salaries when someone dies, we repair hospitals when someone dies, we make alternative VIP routes when a kid is born in a rickshaw – at least someone isn’t dying in this case – we make laws when someone dies, we break laws when someone dies and if the death doesn’t cause enough chorus, then we simply don’t make an effort to change. It is almost like this big black blob of alien
lethargy has engulfed policy makers and people alike. I never really fell for those zombie movies. They were too gory for my liking, and I never really believed it was possible for thousands of people to walk around like robots uttering the occasional ‘YAP’. The gods it seemed were listening, for they have proved me wrong yet again. All those zombie movies apparently had taken their inspiration from the Pakistanis. We are the walking dead. We just cannot bother. While many self-proclaimed ‘models’ will want to execute me for treading the ‘blasphemous’ path of daring to call them ugly, what else would you call a dead, empty and hollow nation that cannot join in the cause of its fellow citizens or protest against the decimation of national institutions, railways being one of them. We all love to speak and be heard no matter how unpleasant we sound. It is our favourite past-time. so, what exactly is wrong with Pakistan railways? Is it an inherent problem with public institutions that they simply cannot sustain efficiency. I wasn’t born back then, but I have read a lot about PIA in the 1960’s. PIA
Public institutions cannot perform the way they do without sustained mismanagement and inefficiency
made emirates what emirates is today. Public institutions are not inherently rotten, it takes sustained levels of mismanagement and corruption to bring them to the levels they are at today. so, Pakistan railways has 520 locomotives, a handsome number, more than what it needs really. However, the problem is not the number of locomotives but rather how many of them are really operational. Any guesses? only 87. Yes, out of 520 locomotives only 87 are operational, but that’s not where the story ends. Intriguingly, Pakistan railways does not have money to purchase fuel for the 87 locomotives that are operational. Talk about rotten luck. The writer is News editor, Profit What do the powers to be propose when things get out of hand? Privatisation. This seems to be the new ‘in’ thing, after those rubber strap
swatch watches that our worthy rulers, adorned on their precious wrists. once upon a time, we did try to privatise PTCL. right now, we’re desperately trying to get etisalat to pay $800 million it owes to the government for PTCL. Then we have the KesC, another success case, or so we make it out to be. Just yesterday, KesC’s outstanding payments to ssGC stood at rs32 billion. Privatisation, isn’t a utopian world with fairies and glitter. It sometimes has the ability to emanate the putrid smell of the wasteland that has evolved in terms of our state owned institutions. The answer, to all our dilemma’s is simply honesty, and the will to inculcate efficiency by making the right decisions. The question is, are we up for the challenge? The writer is News Editor, Profit. He can be reached at ali.rizvi7957@gmail.com
Saturday, 19 November, 2011
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Gas cess will create space for the federal government for infrastructure development, as it will generate Rs35 billion per annum
news
Petroleum Minister, dr asim hussain
WAPDA to initiate hydropower projects
Piaf lauds rs4.5b recovery from rental power plant LAHORE: Pakistan Industrial and Traders Association Front (PIAF) has paid rich tributes to supreme Court of Pakistan for ordering to recover rs4.5 billion from a rental power company and said the decision would go a long way in helping to remove menace of corruption that is hollowing foundations of the country. In a news statement PIAF Chairman sohail Lashari, senior Vice Chairman Nadar Kamal osman and Vice Chairman Junaid Iqbal sheikh and said that business community has always urged government to construct Kalabagh dam for generating cheap and sufficient electricity in the country but present regime shelved the project and depend on costly thermal energy. Staff RepoRt
lahore Staff RepoRt
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ATer and Power development Authority (WAPdA) is implementing a number of projects in water and hydropower sectors. These projects, on completion, will not only help increase water storage capacity but also decrease electricity deficit in the country. This was stated by WAPdA member (Water) syed raghib Abbas shah, while addressing a delegation of Pakistan Air Force (PAF) War College, Karachi. delegation, headed by PAF War College Commandant Air Vice marshal Azher Hasan, visited WAPdA House. WAPdA secretary Imtiaz Tajwar and senior officers concerned were also present on the occasion. member (Water) said initiation of diamer-basha dam, the largest project in the history of Pakistan, is a major breakthrough in water resource development in the country. This roject alone will store 8.1 million acre feet (mAF) of water to supplement irrigation supplies besides generating 4500 megawatt (mW) of low-cost hydel electricity. some other mega
Banks asked to report investment portfolio to CiB
projects, currently in various stages of their implementation, include 7,100 mW bunji, 1,410 mW Tarbela 4th extension, 4,500 mW dasu and 740 mW munda Hydropower Project, he added. member (Water) further said a programme of constructing small and medium-sized dams in all four provinces is underway for socio-economic uplift of backward areas. earlier, WAPdA Hydro Planning General manager Hasnain Afzal and PePCo
Chief engineer Farasat Zaman briefed delegation about water and power sector respectively. delegation was informed that another 20 million acres of virgin land can be cultivated, subject to availability of water. delegation was briefed that five hydropower projects with cumulative generation capacity of about 400 mW will start contributing to national grid by 2012. delegation was apprised of new initiatives of WAPdA related to
SRO1012 UNREALISTIC: LCCI lahore Staff RepoRt
AHore Chamber of Commerce and Industry termed sro 1012 as unrealistic, unjustified and urged Federal board of revenue (Fbr) to immediately withdraw the said sro that is bound to create more troubles for commercial importers. In an issued statement LCCI President Irfan Qaiser sheikh said federal board of revenue must avoid issuing any sros without due consultation of chambers of commerce in the country for being main stakeholders. LCCI President said sudden imposition of higher rate of 5 per cent income tax and sales tax on commercial importers has blocked clearance
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of raw materials; thus hitting commercial importers hard. Irfan Qaiser sheikh said sro 1012 will have devastating effects as with increase in tax on commercial imports, cost of manufacturing and end product would ultimately become dearer. He said these and many other proposed increase in tax will strangle crisis-hit businessmen in the country. Irfan Qaiser sheikh said Lahore chamber of commerce and industry feels that federal board of revenue is fast attaining status of a money making machine which is unjust and unethical. “If Fbr was interested collecting revenues, it must bring more
sectors into the tax net instead of creating troubles for the registered persons who were already doing businesses in the presence of multiple internal and external challenges.” LCCI president said it is very difficult to understand why people at helm of affairs at federal board of revenue do not consult chambers of commerce and industry in the country before issuing sros or formulating business related policies. He urged federal finance minister dr Abdul Hafeez sheikh to help withdraw sro 1012 that is going to spoil the very spirit of business. In prevailing economic conditions business community will have no other option but to stop their businesses he concluded.
canal lining, treatment of saline water, application of high efficiency irrigation system, inland water transportation etc. delegation was also informed about current situation of power sector including reasons for electricity loadshedding, measures being taken to mitigate power shortages as and receivables and payables of PePCo. Later, WAPdA member (Water) and Commandant PAF War College gave souvenirs as memento to visitors.
uS to help Pakistan improve aquaculture sector ISlaMaBaD Staff Report
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merICAN soybean Association (AsA) and Fisheries development board (Fdb) of Pakistan have signed an agreement for a three-year programme aimed at improving the capacity, productivity, quality and profitability of the Pakistani fishing industry. The public-private venture is being funded by a $2 million grant from Us department of Agriculture. The programme will begin with six select trial sites and will expand over three years, eventually reaching an estimated 4,000 farmers. It will implement feed trials, with the goal of building capacity in the aquaculture sector and increasing the productivity of fish farmers.
Bulls led by OGDC return to KSE karachi
Sundar estate to start own power generation from 2012 LAHORE: Punjab Industrial estate and development & management Company (PIedmC) will start generating its own coal-based electricity at sunder Industrial estate from 31st october, 2012. PIedmC Chairman s m Tanveer, while speaking to a select group of journalists, said a separate powerhouse with capacity of 50 megawatts would be established within nine months after awarding contract. Powerhouse at sundar Industrial estate will start trial production from 31st August, 2012 in line with vision of Punjab Chief minister mian shahbaz sharif to make the province an industrial hub. Staff RepoRt
Conference and exhibition on logistics and Supply Chain Management to be organised LAHORE: Pakistan International Freight Forwarders Association, Air Cargo Agents Association of Pakistan and Publicity Channel are jointly organising International Conference and exhibition on Logistics and supply Chain management on November 22, 2011 at a local hotel. Conference director, mehmood Tareen, in a statement said Logistics and supply Chain management companies, Ports and shipping, Airlines, road and rail transports, Import and export Companies, Freight Forwarders, Terminal operators and experts of various relevant businesses are participating in this conference. Staff RepoRt
Custom houses to remain open today ISLAMABAD: Federal board of revenue (Fbr) has announced that all model Customs Collectorates shall remain open today in order to facilitate the trade and industry in getting their cargo cleared for imports and exports. Fbr directed all chief collectors to coordinate with management of sbP and NbP to provide banking facility by designated branches to ensure payment of duty and taxes. Port authorities and port operators have been advised to synchronise their working accordingly. Staff RepoRt
Silkbank buys 11.24pc shares of GCl KARACHI: silkbank has acquired 11.24 per cent stakes of Gharibwal Cement Limited (GCL), the bank’s shareholders at Karachi stock exchange (Kse) were informed. According to a notice issued by silkbank, the bank has entered into a debt-equity swap transaction with the sponsors of GCL whereby, the bank has acquired some 45 million shares of the cement company. Staff RepoRt
Staff report
L
oW volume spur during closing hours in oil sector heavy weights did allow the index to recover from deep red zone wherein oGdC contributed 44 points, while substantial contribution by mid tier stocks allowed the volume to match the previous sessions, wherein bAFL and Fatima fertiliser led the volume by making a combined contribution of almost 50 per cent to over all turnover. The Kse 100 index closed at 11970.53 levels with the gain of 57.11 points, while Kse 30 index lost 39.81 points to close at 11239.51 levels. All share index closed at 8276.41 levels after gaining 38.87 points. Total 150 scrips advanced 132 declined and 17
KARACH: Central bank has asked all member financial institutions to report details of selected portfolio of their investments to its Credit Information bureau (CIb) against specific product codes enumerated by the regulator. “This refers to bsd letter No bsd/sU61/101/7494/2004 dated december 9, 2004, forwarding therewith specimen for credit information reports and data collection formats for submission of credit data to Credit Information bureau, state bank of Pakistan,” said CPd Circular Letter No 3. Staff RepoRt
100,000 mt imported urea arrives remain unchanged out of total 299 scrips traded. Gloomy economic and financial situation along with uncertain political environment coupled with various internal matters will continue to restrict the activity at the local bourse, said Hasnain Asghar Ali at Aziz Fidahusein, adding that low
volume strength in high priced and expensive stocks will therefore continue to invite renewed selling. “However despite various rumours regarding new taxes on fertiliser sector, stocks away from the wrath of gas curtailment will continue to invite equity specific funds, dips can therefore be looked for both
accumulations,” he added. “Clarity on political front and unveiling of the strategy to address economic and financial matters that are likely to deteriorate further in upcoming months will continue to stay essential for reduction in degree of nervousness’ prevailing amongst the local stakeholders,” he said.
KARACHI: ship mV “HYderAbAd” carrying 50,000 mT imported Urea and mV “PoLLUX” carrying 25,000 mT imported Urea arrived yesterday at Gwadar Port. Another vessel mV “Great mary” from UAe carrying 25,000 mT Urea will arrive by 22nd November, 2011. According to a statement issued by Trading Corporation of Pakistan (TCP), two more vessels, mV “medI LIsboN” from bahrain and mV “dubai Ambassador” from Qatar, carrying 45,000 mT each, are expected to arrive within next few days. Staff RepoRt
Saturday, 19 November, 2011
The good news is that some serious minded politicians are placing good governance and institutional reform at the heart of agendas they are constructing
news
former Govt advisor, Sakib Sherani
05
The Wall Street disconnect NeW york
I
ReUteRS
T was a telling moment at the height of the occupy Wall street protests. John Paulson, the hedge-fund trader who famously made billions betting on the collapse of the housing market, was threatened by the demonstrators with a march on his Upper east side home in New York last month. Paulson responded by putting out a press release that described his $28 billion, 120-person fund as an exemplar of the American dream: "Instead of vilifying our most successful businesses, we should be supporting them and encouraging them to remain in New York City." other captains of finance like to portray themselves as humble entrepreneurs. one owner of a multi-billion-dollar hedge fund grumbled in the midst of the financial crisis that he has to worry not only about making trading decisions but also about "all the hassles that come with running a small business." With U.s. cities moving this week to crack down on occupy Wall street encampments - including the one in New York's Zuccotti Park - the staying power of the movement is in question. Whatever its future, it's clear that so far, the occupiers haven't changed many minds on Wall street over blame for the country's hard times. The cognitive disconnect between the protesters and the captains of finance is alive and well. david mooney, chief executive officer of Alliant Credit Union in Chicago, one of the nation's larger credit unions, used to work at one of Wall street's top banks, JPmorgan Chase. There's a vast cultural gap between Wall street and his new world, he says: old friends from the street, he says, now jokingly refer to him as a "socialist." A credit union is supposed to be run in the interests of all members, he says, while commercial bankers tend to see consumers as customers who can be "exploited" by layering on more fees.
says mooney: "I don't say this lightly, but the consumer is simply an income stream and exploiting that is the purpose of the banking organization." In conversations with nearly two dozen current and former bankers, finance professionals and money managers across the United states, the prevailing sentiment is that the anger at Wall street's elite is misguided and misdirected. blame the politicians and policymakers in Washington, many of them say, for encouraging people to buy homes they couldn't afford and doing nothing to stop or discourage U.s. consumers from piling on more than $10 trillion in household debt. "I think everyone gets what the anger is about... but you just can't say, 'Well I want all debts forgiven.' That is not happening," says one West Coast trader, who like most still working in the financial services industry, declined to be identified by name in this article. The disconnect, says Jason Ader, a former top Wall street casino analyst turned hedge fund manager, is in part a simple product of Wall street's isolation from the hardship out there. Ader says he spends a lot of his time in Las Vegas, one of America's hardest-hit housing markets, and thus wasn't too surprised by this fall's anti-Wall street outburst. but the 43-year-old Ader, who manages $200 million in his hedge fund, says it's a different story for many of the wealthy who work in finance in New York City and don't spend a lot of time in states with high unemployment and high foreclosure rates. Living in manhattan or the Hamptons or hedge fund havens like Greenwich, Connecticut, can lead to a bit of myopia, he says. "At first I had friends who were scratching their heads at the protests," says Ader.
BLAME GAME To put it bluntly, many on Wall street still see the events leading up to the financial crisis as a case of banks having le-
gitimately sold something - whether it be mortgages or securities backed by those loans - that someone wanted to buy. Thomas Atteberry, a partner and portfolio manager with Los Angeles-based First Pacific Advisors, a $16 billion money management firm, says his success "wasn't a gift" and he had to work hard to get where he is. Atteberry says he understands the frustration many feel about income inequality. but he said the problem isn't with those who are successful, but rather our "tax codes and regulations." While some members of the financial elite say they are willing to pay higher taxes, they note the picture for Wall street firms is not as sunny as some on main street might paint it. Wall street banks already are beginning to shed jobs, and consulting firm Johnson Associates Inc. is predicting bonuses for those who remain will shrink by 20 per cent to 30 per cent. Complaints over new financial regulations burdening Wall street firms are a major reason blamed for the layoffs. sit down with a hedge fund manager or a top trader and it won't take long before he or she grabs some spreadsheet that shows all the new rules and regulations coming out of the dodd-Frank financial reform bill. many of America's well-to-do, not just Wall streeters, say they don't feel particularly advantaged. A recent survey by marketing firm HNW Inc. found that half of the nation's richest 1 per cent "don't see themselves as being part of that elite group." Also, 44 per cent of those surveyed told HNW's pollsters they already pay too much in taxes. maybe it is just the ethos of Wall street, where success is defined solely by who makes the most money, that makes it hard for financiers to feel they've wronged anyone. but in a time of 9 per cent unemployment and 15 per cent of U.s. citizens receiving food stamps, some Wall street alums say the financial elite are doing themselves no favors by giving the appearance of shrugging off the current mood. "I think Wall street hasn't taken in
how much anger there is out there and they haven't taken partial responsibility for the financial crisis," says brookings Institution fellow douglas elliott, who was an investment banker for two decades before joining the liberal-oriented public policy group. "I think both sides - Wall street and main street - misunderstand each other." some who get paid to advise the rich on how to deal with the media and the public are telling clients to pay attention. robert dilenschneider, founder and principal of The dilenschneider Group corporate consulting group, recently sent a report to his clients telling them that many of the protesters taking part in the occupy movement are not a bunch of unemployed crazies and hippies. "The Ceos in big board rooms in Paris, in Zurich and New York don't normally think about people who are demonstrating in parks," says dilenschneider, whose firm advises some of the biggest companies in the world. "In the banking and financial area, we are telling our clients you have to explain more completely what makes up your business and why your profits are what they are."
MOM AND POP HEDGE FUNDS some of the disconnect is simply a matter of lifestyle and the fact that the super wealthy really do live differently from everyone else. Hedge fund managers and bankers fly around on private jets, live in palatial penthouse apartments overlooking Central Park and have second homes in the country. In New York City, the average pay for those working in finance is $361,183, more than five times the average salary of $66,106 for all workers in the city, according to the New York state department of Labor. This disparity in income and attitudes was evident in the response of hedge fund managers like Paulson who portrayed themselves as humble busi-
nessmen. says Wall street historian Charles Geisst, "Hedge funds may be small businesses in terms of labor intensity, but in terms of capital intensity they are just the opposite." A spokesman for Paulson said he had nothing more to add on the subject.
LESSONS LEARNED There are exceptions, of course. some are saying it may be time for the government which has bailed out the banking system to help millions of struggling homeowners. one of those is former top Pacific Investment management Co executive Paul mcCulley, best known for his analysis on central banks and monetary policy when he worked at the world's biggest bond fund. mcCulley, who retired a year ago from Newport beach, Californiabased PImCo to become a consultant with a public policy firm, enjoys the wealth he accumulated in his old role. He lives in a house by the water where he docks his two boats. but he says Wall street went too far. "our society was ripe for a convulsion about social justice, and occupy Wall street was the catalyst for that," says mcCulley. "New York can be very insular. It is not the real world and neither is Newport beach." Now that he's no longer working for PImCo, mcCulley is a bit more free to speak his mind. And he says the only way to jumpstart the U.s. economy is for the federal government to get behind a serious program to encourage consumer debt forgiveness and principal reductions on mortgages by banks. mcCulley noted that mortgage firms Fannie mae and Freddie mac have been propped up by about $169 billion in federal aid since they were rescued by the government in 2008, yet there's a "a moral overtone" to the argument against reducing mortgage debt burdens for individual borrowers. "Wall street capitalism has given us a foul stench in our society," says mcCulley.
CORPORATE CORNER habib Bank ltd to launch mobile financial services
Price, discription, bid offer, Investment secure Fund, 104.7081 110.2827. Investment multiplier Fund, 103.7081 109.1664. pReSS ReLeaSe
uS diplomats appreciate Chen group and Chenone
SINGAPORE: HbL, inked a technology support agreement with sybase 365, a subsidiary of sybase, Inc and AbacusConsulting, for the deployment of branchless banking services. senior management of HbL, mr Faiq sadiq, Head of Payment services, mr mudassir Khan, Chief Information officer, mr Tarik Husain, business development director, Commerce, sybase 365 and mr Abbas Ali Khan, senior Partner, AbacusConsulting along with other officials of sybase 365 were present on the occasion. sybase 365 and AbacusConsulting will implement branchless banking services for HbL and facilitate this large scale deployment for capitalising on great market potential including the rural and non banking population. pReSS ReLeaSe
adamjee life investment growth funds see an upward trend KArACHI: Adamjee Life Investment growth funds saw an upward trend during october. Per unit NAVs (as of oct 31st 2011) are as follows: Unit
LAHORE: Chenab group and Chenone are one of the leading brands of Pakistan which are also well recognised internationally for their textile products. Us Ambassador, mr Cameron munter and Us Consulate General, Lahore, Nina m Fite visited Chenab mills and Chenone head office in Faisalabad. The Chairman, mian muhammad Latif and Ceo, mian muhammad Kashif Ishfaq, greeted them and showed them different departments of mills. They highly appreciated the ambiance of the mill and work done by the group. pReSS ReLeaSe
aurat foundation holds a consolation meeting LAHORE: eminent economist, dr Qais Aslam, addressed a provincial consultation meeting on women and issues of food security in Pakistan organised by legislative group of Aurat foundation at a local hotel. emphasising on the importance of the agriculture sector, he said that agrarian period
farm managers and female farm workers are disadvantaged by being less informed and less educated. They are not even acknowledged for the efforts that they put in. pReSS ReLeaSe
Added services system will allow the customers to subscribe to all sms based value added services directly through the website. pReSS ReLeaSe
Mr akbar takes charge as co-chairman MSSSt
ISLaMaBaD: Dr Ruqayya Saeed hashmi, provincial Minister is awarding certificate to Mr Shahid hussain, Lecturer, Mass Communication aIoU on completion of 16th Master trainers–faculty professional Development programme, Chairman heC, Dr Javaid R Laghari is also present. PRESS RELEASE PESHAWAR: Inspector General of Police, Khyber Pukhtunkhwa, mr Akbar Khan Hoti, visited malik saad shaheed sports Trust (msssT) office after taking charge of co-chairman of msssT. He appreciated the efforts made by msssT, in promotion of sports education and health care sector in the province and also for the promotion of sports activities by paying rich tribute to shaheed Police officers. pReSS ReLeaSe
Zong revamps its website ISLAMABAD: To facilitate its customer, Zong, has successfully revamped its website. New userfriendly features have been added to the website which include, value added services activation facility, online chat to provide online support and poll for customer feedback. The latest online Value
KaRaChI: executive Director finance and It, Yacoob Suttar and General Manager Lubricants and Retail Business, S Zulfiqar a Jaffri unveiled the model of Deo 6000. Chairman pakistan petroleum Dealer association and CNG Dealers’ association, abdul Sami Khan was also present on the occasion. PRESS RELEASE
Saturday, 19 November, 2011
06 Markets top 10 sectors
24% 09% 35% 10% 08%
Chemicals
01% 07% 02% 03% 01%
General Industrial
Construction & Materials Electricity Banks
Fixed Line Telecommunication
Oil & Gas
Financial Services
Personal Goods
Equity Investment Instruments
STOCK MARKET HIGHLIGHTS Index 11937.81 3118.72 2684.88
KSE-100 LSE-25 ISE-10
Change +24.393 -1.45 19.96
Volume 4,138,780 1,303,320 52,950
Market Value 1,346,540,124 28,200,451 1,607,508
Major Gainers Company Bhanero Tex.XD Indus Motor Co. Sapphire Tex.XD Thal Ltd P.S.O.
Open 228.58 204.00 103.50 82.00 252.58
High 239.00 210.00 108.65 85.70 256.02
Low 220.00 204.00 108.00 81.05 250.59
Close 238.53 209.59 108.65 85.22 255.26
Change Turnover 9.95 2,051 5.59 6,381 5.15 3,208 3.22 261,765 2.68 369,531
5600.00 690.00 3030.00 200.00 175.50
5252.00 670.00 2855.00 195.00 172.00
5479.96 680.00 2986.39 195.14 172.75
-47.64 5 -20.00 117 -16.28 10 -3.87 1,126 -3.53 1,413,159
Major Losers UniLever Pak Ltd. Wyeth Pak Limited Nestle PakistanXD Service Industries Fauji FertilizerXD
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
Bank Al-Falah Fatima Fert.Co. Lotte PakPTA Byco Petroleum Fauji FertilizerXD
11.79 23.16 10.54 6.93 176.28
12.19 23.30 10.90 7.28 175.50
11.65 22.35 10.53 7.00 172.00
12.07 23.05 10.78 7.20 172.75
0.28 -0.11 0.24 0.27 -3.53
11,184,726 7,301,127 1,617,640 1,601,616 1,413,159
Bullion Market Gold 24K Gold 22K Silver (Tezabi) Silver (Thobi)
Per Tola (PKR) 56,378.00 51,608.00 1,053.00 1025.00
Per 10 Gm (PKR) 48,387.00 44,245.00 904.00 880.00
Per Ounce US$ 1,736.00 – 35.05 –
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 86.70 117.43 136.97 1.1261 84.32 11.00 23.60 23.11 86.71
Sell 87.40 118.67 138.31 1.1338 86.49 11.25 23.76 23.25 89.21
Brent Crude Oil
$112.39
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
Abdullah Shah Colony Sugar Mills Engro Foods Ltd. Habib Sugar Mills Habib-ADM Ltd.XD
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
31.00 30.82 4.01 120.42 119.16
AHCL-NOV AHCL-OCT ANL-OCT ATRL-NOV ATRL-OCT
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)
voluMe
Pharma and Bio Tech
General Industrials Cherat PackagingXD ECOPACK Ltd Ghani Glass LtdXD MACPAC Films Merit Pack
ChanGe
Future Contracts
Construction and Materials
Ados Pakistan AL-Ghazi Tractors Bolan CastingXD Ghandhara Ind. Hinopak Motor
International Oil Price WTI Crude Oil
$99.05
23.90 1.45 8.93 34.98 11.56
loW Current
Personal Goods
Industrial Engineering
87.1242 137.1160 1.1310 117.2082
US Dollar Euro Great Britain Pound Japanese Yen Canadian Dollar Hong Kong Dollar UAE Dirham Saudi Riyal Australian Dollar
Crescent Steel Dost Steels Ltd. Huffaz Seamless Pipe Int. Ind.Ltd. Inter.Steel Ltd.
hiGh
Household Goods
Industrial metals and Mining Volume Leaders
oPen
Food Producers
Chemicals
5527.60 700.00 3002.67 199.01 176.28
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 AL-Noor ModarXD 3.98 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
13.42 32.00 35.20 6.01 30.00 15.85 70.00 1.52 70.02 115.96 62.39 133.00 29.45 14.50 7.96 1.90 10.75 0.91 1.83 1.05 17.50 19.85 68.25 1.60 10.60 2.60
13.50 32.00 35.20 7.00 31.00 15.98 70.50 1.60 70.60 115.96 62.39 140.00 29.50 15.50 7.96 2.00 10.80 0.96 1.85 1.11 17.69 20.16 68.36 1.68 10.73 3.00
0.00 0.21 -0.32 0.00 0.00 0.13 -0.16 0.04 0.00 0.00 0.00 0.00 1.40 0.00 0.00 0.04 -0.07 0.03 -0.04 0.01 0.04 0.17 0.23 0.00 0.01 0.40
226 2,500 1,047 209 263 1,603 562 151,424 144 2 100 2 6,693 399 162 3,304 286,584 63,010 36,169 62,318 21,001 43,567 720 106,404 383,612 604
Miscellaneous Century Paper Pak Paper Prod. Security Paper Johnson & Philips Pakistan Cables P.N.S.C.XD Pak.Int.Con. SD TRG Pakistan Ltd. Murree BreweryXDXB Shezan Inter.XD Pak Tobacco Co. Philip Morris Pak. Shifa Int.Hospitals Hum Network XD Media Times LtdXR P.I.A.C.(A) P.T.C.L.A Telecard Limited Wateen Telecom Ltd WorldCall Telecom Sui North GasXDXB Sui South GasXDXB EFU Life Assur Pace (Pak) Ltd. Netsol Technologies Pak Telephone
13.50 31.79 35.52 7.00 31.00 15.85 70.66 1.56 70.60 115.96 62.39 140.00 28.10 15.50 7.96 1.96 10.87 0.93 1.89 1.10 17.65 19.99 68.13 1.68 10.72 2.60
13.90 32.00 35.99 7.00 32.10 16.00 71.80 1.63 70.99 118.50 64.00 140.00 29.50 15.99 8.96 2.14 10.95 1.00 1.90 1.14 17.80 20.50 69.94 1.80 11.00 3.60
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
Saturday, 19 November, 2011
closing bell
BooNDoCKS
AriES
tAuruS
gEMini
You are more accident-prone than usual today, so either take greater care than usual to buffer yourself from harsh reality or just accept that you're going to get scraped up (Maybe emotionally).
Your fun energy is making life sweeter for almost everyone around you, and you might find it hard to keep from smiling yourself! Keep up whatever it is that's working for you and share the love!
You and your people (family, mostly) need to deal with each other in a new, more intimate fashion. It's easier than ever for you all to misunderstand each other, so do your best to chill for the time being.
cAncEr
LEo
virgo
Your ability to get your point across -- even when you're not sure what it is yourself when you start -- is peaking right now, so you've got to speak up to make the most of it. Share your thoughts!
Your financial situation is pushing you into new and strange territory today. It might be a good time to rethink your big plans, or maybe you just need to deal with life as it really is for now.
Your latest achievement is making life much more interesting for you -- and possibly more lucrative! You should certainly expect more attention, and you may want to keep building on this.
LibrA
ScorPio
SAgittAriuS
Pay close attention to detail today -it's in your nature to be perceptive, but you also need to be meticulous in order to clear out everything that needs to go. Life starts to get more engaging soon.
You're great with secrets -- almost everyone knows that. Still, on a day like today, you'd just as soon not feel the pressure of keeping them held so tightly. Try to find one person to trust and share with.
You need to deal with something bigger than just your own needs today -- some authority figure demands it. See if you can get your colleagues or friends to pitch in and help you out.
DILBeRt
GaRfIeLD
AQuAriuS
PiScES
Details are everything today, so make sure that you're on top of them. It shouldn't be all that hard for you, as your energy is just right for tackling issues of importance. Show the world how it's done!
Details are everything today, and though you often prefer the big picture, you can still get ahead by focusing on one small piece at a time. Make sure you can take some time off soon, though!
You need to spend some time and energy with a friend or loved one today -- your ability to patch up relationships is near-perfect right now. Make sure that everyone is getting a little of what they need.
CMYK
BaLDo
cAPricorn
CRoSSWoRD
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.
Today’s soluTions
NoN CoNSoLatIoN
CheSS White to play: play and mate in 4 moves 8 7 6 5 4 3
1 A
B
C
D
E
F
G
H
CMYK
chess solution
2
2.axb3 Bxh6+ 4.Qg7# *
1. Sailors 2. Curved molding 3. Diplomacy 4. Send forth 5. official tree of Canada 6. pair 7. flower part 8. Unyielding 9. 5280 feet 10. practices 11. Lengthways 12. anxious 13. S S S S 18. Crimson 24. eastern newt 25. Ringworm cassia 26. a fitting reward (archaic) 27. Church alcove 28. Seats oneself 29. Daughter of a step-parent 31. an amount of medicine 33. Warms 34. arab chieftain 36. Murres 37. Lease 38. Border 42. a vehicle that races 43. possessed 45. Incumbency 47. Slang for money 48. Sound 49. Malicious 51. Metric unit of area 52. Leases 54. Group of cattle 56. ampule 57. Skin disease 58. a magician 59. Raindrop sound 62. Kitten's cry
nEighbor PELt rAiSE rAMbLE rELic rELiES rEwArD right riLL SALvAtion SEriES ShAkE ShArE SLED SPort StrEEt StroLL tArS unDEr viEwErS writE wrong
1.Bxf6 Nb3+ 3.Qxh6+ Kg8
1. Clan emblem 6. Streetcar 10. Be worthy of 14. Small terrestrial lizard 15. Dry riverbed 16. X X X X 17. Multiplicative inverse 19. ancient units of liquid measure 20. homestead 21. an uncle 22. "___ on Down the Road" 23. Swelling under the skin 25. the general activity of selling 26. Catholic church service 30. Mudguard 32. an abusive word or phrase 35. the shaved crown of a head 39. high regard 40. Caught 41. hopelessness 43. Curative 44. Layers 46. Satisfy 47. foundation 50. a type of tree 53. flows 54. female chicken 55. overhaul 60. Modify 61. Nonsectarian 63. assistant 64. Unusual 65. a type of dance 66. one who accomplishes 67. Sketched 68. Slumber
ALwAyS ASPirE bELLS boArD cEDE cLAuSE cLoSES coronAtion cruMbLE DoPE EMAiL grEAt guiDES hELM hirE intErESt LEASE LiES LiLy MiLES MonEy nAgS
sudoku solution
DOWN
WoRD SeaRCh
crossword solution
ACROSS
07
Saturday, 19 November, 2011
Change in management is not easy but we also know that Pakistan is an example of resourceful people. the only area where it lacks is in processes that defines fully articulated formulation of plan
news
08
former Governor SBP dr ishrat hussain
Government’s budgetary borrowing from banks crosses Rs708 billion g g g
Govt borrows rs96 billion from SBP, rs612 billion from scheduled banks loans from commercial banks skyrocket by 700 per cent Banks credit to private sector down to negative rs31 billion karaChI
C
ISMaIL DILaWaR
AsH-sTrAPPed government’s budgetary borrowings from banking system continue to swell and accumulated to rs708.145 billion during first four months of current financial year. The amount depicts an exorbitant increase of 177 per cent when compared with rs255.311 billion the funds-starved central and provincial governments had borrowed from banks during corresponding months last year. In monetary terms this mammoth increase in government’s budgetary borrowings account for rs452.834 billion. Central bank, however, has been successful in significantly decreasing volume of its budgetary loans from state bank that, analysts believe, is inflationary in nature. Central bank reported that during July-Nov 4 (FY21) the resource-constrained government borrowed rs95.750 from sbP billion, 46 per cent less than rs179 billion it had taken during the same period in FY11. some quarters, however, perceives that dip is part of government’s new covert strategy to borrow indirectly from state bank. This means that the embattled government, amid dim chances of financing from its foreign lenders and donors, first
injected billions into banking system and then borrowed the same from commercial banks. Friday also saw central bank pumping a huge sum of rs342.750 billion into banking system at 11.52 per cent annual rate of return to avoid an otherwise imminent liquidity crunch. on the other hand, scheduled banks remained major financers of government’s ever-widening fiscal deficit, which sbP counted at rs1.194 trillion during FY11 against rs929.061 billion of FY10. Leaving little space for the growth-oriented private sector, government is borrowing extensively from commercial banks and secured, during period under review, over rs612.39 billion. Compared to rs76.514 billion, of corresponding period last year, this amount shows a huge growth of 700 per cent or rs535.881 billion. banks’ credit to private sector is constantly depleting and shrank to negative rs31.531 billion against last year’s positive rs671 billion. banks’ credit to nongovernment sector came down to negative rs262.960 billion against negative rs19.774 billion in FY11. on the back of their excessive lending to non-productive public sector, banks’ net domestic assets (NdAs)
marked an increase of rs64.32 billion and accumulated to rs168.40 billion compared to rs104.16 billion in corresponding period of FY11. According to sbP figures, of total budgetary support sbP extended rs31.393 billion to federal and rs50.075 billion to provincial governments. While scheduled banks’ lending to centre and provinces stood at rs611.232 billion and 13.227 billion, respectively. monetary expansion is also on lower side due to reduced foreign assts of banking system that contracted to negative rs106.377 billion compared to last year’s positive rs57.118 billion. According to sbP, broad money, also called m2, shrank to 0.936 per cent or rs62.102 billion (in monetary terms) against 2.79 per cent or rs161.278 billion of corresponding period in FY11. Circulation of money also slid to rs183.139 billion from rs195.015 billion previously. economists warn that since much of the bank finances are being eaten up by public sector for non-productive purpose of running of government, the country was likely to miss its 4.2 per cent GdP growth target for the current year. They suggest that banks’ advances must go to private borrowers who, through generating economic activity, create jobs that would lead to economic growth in the poverty-hit country.
Govt working towards equalisation of tax on fertiliser plants fertiliser company margins shoot up g fauji fertiliser Company and fatiMa, benefiting g engro increased urea price to rs2,000 per bag g
karaChI
A
Staff RepoRt
dVIsor on Petroleum and Natural resources has said government is studying a proposal to slap an equalisation tax on fertiliser plants running on gas in order to analyse the per bag rise in the prices of urea. Fertiliser company margins have shot up exorbitantly since urea bag prices have increased by more than 50 per cent this year thus, benefiting efficient players such as, Fauji Fertiliser Company (FFC) and new players like, FATImA. some of the plants that resorted to increase urea prices include, engro Fertiliser whose new plant got interrupted gas supplies from Qadirpur and did not receive designated 100mmcfd gas from Qadirpur throughout the year and hence, resulted in a shortfall in urea supplies. engro got enraged and reportedly increased the price of urea to rs2,000 per 50kg bag, but was maneuvered back by government to keep the prices at an old rate of rs1,580 per 50kg bag. The rolling back of prices to nearly rs1580 per 50kg is still high from local standards since these prices were around rs1,200 per 50kg only a few months ago or at least at the start of the year. The question of putting equalisation tax may be for those plants that are not efficient
users of gas supply. It is being reported that an efficient fertiliser plant produces 42 tonnes of urea by utilising one million cubic feet of gas per day whereas, there are few that are inefficient users and produce 38 tonnes with the same gas supply. It has also been said that this arrangement would only be probable if plant audits are carried out (which may take some time). The matter is likely to be brought up by the advisor into Cabinet Committee of economic affairs called eCC. reportedly, 4 fertiliser plants, on the network of sui Northern Gas Pipelines Limited, need 240 mmcfd, but they are currently getting 162 mmcfd thus, causing problems for engro fertiliser and some other plants such as Agritect and dawood Hercules. Faisal shaji at ssC Trade said they consider CY11 ePs of preferred scripts such as, FFC and Fatima, and also like, Fauji bin Qasim (yielding 5x) given intact margins on dAP fertilisers despite tight position of margins globally while FFbL is placed at a favourable position due to uninterrupted supply of raw material P2o5. ‘We signal cautious approach on engro Corp since company is still not in a favourable position as far as reception of gas supplies is concerned. Pak Arab Fertilisers (not listed) situated at multan is reportedly receiving prices. Arif Habib Corp (AHCL) has beneficial ownership in Pak Arab and hence, at a favourable situation,’ he added.
Pakistan improves five points in global productivity ranking ISlaMaBaD Staff RepoRt
P
AKIsTAN has improved five points in global productivity ranking according to International Productivity Congress (IPC) 2011 that ended with a note to carry mission of productivity enhancement at various economic areas. dr Ishrat Hussain, former Governor state bank of Pakistan, said change in management is not easy but we also know that Pakistan is an example of resourceful people. The only area where it lacks is in processes that defines fully articulated formulation of plan, he added. He stressed on building processes that have a tendency to disseminate information. shaista sohail, Joint secretary, ministry of Industries said currently people are going through a time of uncertainty and low confidence. It is the task of government to use every tool at its disposal to build confidence and strengthen economy against global threats. ministry understands that reform for industrial development through policy and
planning is the need of time. And this is where NPo becomes more important since it has been mandated to address and fill gaps of industrial zone. each resource speaker emphasised the important role NPo is playing in Pakistani economy via series of capacity development programmes. ryuichiro Yamazaki secretary General (APo) – Japan and John Heap President WCPs congratulated NPo for organising a unique event under guidance of CeoNPo Khawaja muhammad Yousuf. CeoNPo Khawaja muhammad Yousuf at his closing remarks said, “I feel that NPo is moving in right direction and by looking at the interest of various dignitaries, who are part of the session, one gets a reflection of expectations from NPo.” on this occasion WCPs awards were given to five honourable individuals on their valuable contribution to industrial productivity enhancement projects. Five people who were awarded included saqib moin-uddin, dr Fakir muhammad, Nauman Wazir and Khawaja mohammad Yousuf.
aPtMa concerned over falling economic indicators g
Sharp decline of 61 per cent in foreign private investment during current fiscal year g textile tops all industrial sectors with record exports of $14b lahore
A
Staff RepoRt
LL Pakistan Textile mills Association (APTmA) Chairman mohsin Aziz has expressed deep concerns over falling economic indicators, likely to dampen growth of textile industry further if no timely action is taken by authorities concerned. He said a sharp decline of 61 per cent in foreign private investment during four months of current fiscal year, lowest-ever
growth rate and increase in Non Performing Loans (NPLs) to rs629 billion has affected industry at large. APTmA chairman said both unbearable interest rate regime and short supply of gas to textile industry are prime reasons behind negative economic indicators. economic state of affairs is full of negative signals and whole economy is likely to be trapped into NPLs in case policymakers fail to take timely actions. He expressed fear that NPLs are likely to catch up further due to deteriorating
state of textile industry which is being denied by gas supply on sNGPL network. Gas supply to industry is in doldrums on sNGPL network, as supply has been reduced to four days a week against five days a week previously, he said. Gas curtailment for three days during a week has impaired 40 per cent capacity of industry he added. He asked if there was any policymaker on earth who could suggest textile industry a recipe to perform with short energy supply and such exorbitantly interest rate but still survive and keep on making payments
to banks in these circumstances. APTmA Chairman pointed out that textile industry performs in a highly competitive environment world over and absence of a level playing field is detrimental to growth of textile industry in Pakistan. He said interest rate is not in double digits anywhere in the region, a phenomenon exclusively rare to Pakistan. mohsin said textile industry has outperformed all industrial sectors last year by achieving record exports of $14 billion and although there was curtailment for two days and could have achieved over $15 bil-
lion if that was even corrected. He said uninterrupted gas supply becomes more urgent for textile industry which has a share of 9 per cent in GdP and employs a workforce of 15 million directly and indirectly in the country. He said President Asif Ali Zardari, Prime minister Yusuf raza Gilani as well as federal Petroleum minister dr Asim Hussain should immediately intervene to not only ensure minimum five days a week gas supply but also bring down interest rate to single digit for sustainable growth of textile industry in larger interest of national economy.