Defying the market?: Market surprised by rupee’s sudden appreciation in interbank market

The rupee has appreciated by 1.9% against the dollar in the interbank market from December 2 to December 19. PHOTO: FILE

KARACHI: Few people believed Finance Minister Ishaq Dar’s fiery statements about arresting the rupee’s swift depreciation against the greenback would actually lead to substantive stabilisation in the foreign exchange market.

But the outcome of his impassioned warnings to speculators has been surprising. The rupee has appreciated by 1.9% against the dollar in the interbank market from December 2 to December 19. The rupee’s strength has been more pronounced in the open market where its value increased by 3.1% over the same period.

Keeping in mind that the rupee depreciated by as much as 9% in the first five months of the current fiscal year alone, one wonders what magic wand Dar waved to fix deep-rooted problems overnight. After all, the rupee has appreciated against the dollar in only two of the last 30 years (2002 and 2003) while the average depreciation of the rupee over the same period has remained at 6.5%.

According to KASB Securities, a Karachi-based research and brokerage house, December has recorded the fourth highest monthly currency appreciation in the last 30 years.

Speaking to a TV channel on December 3, Dar had reportedly vowed to bring the dollar back to Rs98. Although he later clarified the statement by saying the rebound in the rupee’s value would be similar to the one witnessed in 1998-99, Dar continued to warn speculators of an imminent drop in the value of the dollar.

He also urged exporters to repatriate their export proceeds in order to shore up foreign currency reserves.

His persistent calls to the quarters concerned finally start bearing fruit after the first week of December with the rupee gaining strength in the currency market. It was met with Pakistan receiving a long-anticipated inflow of $144 million from the United Kingdom’s Department for International Development, $137 million from the Islamic Development Bank and $149 million from other multilateral institutions.

From a 12-year low of $2.9 billion a week earlier, the inflow of $505 million increased the State Bank of Pakistan (SBP)-held foreign reserves to $3.4 billion on December 13, giving the rupee a long-due respite.

But is the recent improvement in the rupee-dollar parity sustainable? Dar claimed on a public forum recently that he could ‘guarantee’ the rupee would not slide back.

However, most analysts seem unimpressed with the certitude shown by the finance minister. “We continue to expect the rupee-dollar parity to reach Rs112 by June 2014,” said KASB Securities research analyst Farrukh Khan.

Saying that although the recent improvement in the rupee’s value has been swift, Khan noted that the reserves situation has not changed significantly. The rupee-dollar parity was Rs98 in December 2012 when the country’s total liquid reserves stood at $13.5 billion, he noted while implying that the recent development in the currency market will likely be a short-lived phenomenon. Pakistan’s total liquid foreign reserves were $8.5 billion on December 13.

Similarly, another brokerage house, Global Securities, estimates the rupee-dollar parity will be Rs109 at the end of fiscal year 2013-14.

Speaking to The Express Tribune, the head of the foreign exchange desk in the treasury department of a leading private bank said he estimates the dollar to stay around Rs110 by the end of June 2014.

“I think it’ll be wrong to say that the rupee will appreciate against the dollar going forward. Our current account deficit is higher than usual, which will inevitably put the rupee under pressure,” he said while requesting anonymity.

Current account deficit

Pakistan’s current account deficit widened to $1.8 billion in the first five months of fiscal 2013-14 as opposed to a deficit of $684 million in the corresponding period of last year, according to data released by the SBP on Friday.

The current account deficit – the value of how much a country’s imports exceed its exports− in November was $589 million as opposed to $96 million in October.

More Japanese investment depends on law and order

$12.7b is the total amount of aid Japan has provided Pakistan so far. ILLUSTRATION: JAMAL KHURSHID

LAHORE: Among the advanced countries helping Pakistan’s economy, through trade, aid, technical assistance and private investment, Japan is believed to be one of the top contributors.

For the majority of people in Pakistan, Japan is known as the technology giant, which has and is inventing latest automobiles, electrical and ancillary products. Japanese companies have invested heavily in Pakistan, especially in the automobile sector.

In Pakistan’s automobile industry, Japanese companies have a controlling share due to the quality and technology-oriented nature of their two and four-wheel vehicles. These companies are looking to expand their networks mainly due to increasing demand and ideal geographical location of the country. The most recent bout of fresh investment in the sector comes from Yamaha, which is once again entering the Pakistani market, planning to invest some Rs15 billion over the next five years.

“Currently, 76 Japanese companies are working in Pakistan and more will jump in when the law and order situation stabilises,” said Toshikazu Isomura, Counsellor at the Japanese Embassy, while talking to The Express Tribune recently.

These Japanese companies are not only contributing to Pakistan’s economy by paying taxes and generating employment, they are also focusing on localisation of technologies by providing training to locals in order to meet growing demand. For this, these companies are investing in infrastructure improvement, plant/machinery imports and human resources.

Development assistance

Japan was the third largest donor to Pakistan in 2010 after the United States and the United Kingdom, and had been extending assistance to Pakistan through multilateral and bilateral institutions. Bilateral aid is extended through the Japan International Cooperation Agency (JICA) and Grant Assistance for Grassroots Human Security Projects (GGP).

Japan started the Official Development Assistance (ODA) to Pakistan in 1954 by providing technical training and the first Japanese ODA loan was extended in 1961. After Pakistan’s nuclear test in May 1998, Japan took economic measures, suspending new ODA loans and grant aid. The economic measures were discontinued in October 2001.

In April 2009, Japan co-hosted the Pakistan Donors Conference with the World Bank in Tokyo to support Pakistan in counter-terrorism measures and economic reforms. It announced assistance of up to $1 billion in two years, premised on continued steady implementation of the IMF programme.

So far, Japan has provided assistance worth 1,297.2 billion yen ($12.7 billion). Of this, 976 billion yen has been provided as soft loans, 274.8 billion yen as grants and 46.4 billion yen in the shape of technical cooperation.

Such assistance is offered on the request of the Government of Pakistan. Besides the automobile sector, Japan is helping in basic economic and social infrastructure projects like technical training programmes by establishing some high-class technology training institutes, industrial development, power sector, transportation, irrigation and agriculture and other key civic sectors.

Japanese officials are hopeful of further assistance to different sectors, plus inflows of private investment. Private investment is linked with the law and order situation, which the Japanese hope will get better.

Pakistan, Afghanistan face common problems’

Agriculture serves as a backbone to the economies of both neighboring countries. PHOTO: AFP/FILE

FAISALABAD: A five-day international workshop, “Strengthening Extension Skills of Young Professionals in Afghanistan and Pakistan” concluded at the University of Agriculture Faisalabad yesterday.  The workshop was arranged by the Office of Re­search Innovations and Com­mercialization (ORIC), UAF, in collaboration with the US Department of Agriculture (USDA).

Addressing the concluding session, UAF Vice Chancellor Prof Dr Iqrar Ahmad Khan said that the world was gripped by food insecurity and stressed the need for scientists, farmers and extension workers to tackle the issue with collaborative efforts.

“Pakistan and Afghanistan face common challenges and can have common solutions,” said Khan, adding that the lack of quality seed, machinery and horse power was hampering the process of increasing production.

Meanwhile, Dr Jim Hill from the University of California, Davis, USA, said that agriculture served as a backbone to the economies of both neighboring countries.

“Skilled manpower that can increase production will pave the way for the development of Pakistan and Afghanistan,” said Hill.

Dr Louise Ferguson, Dr Chris Pankuk, Dr Grant Dewell,  Dr Charles Schuster and Dr Jerry Peters were also present during the final sessio

Court battle: Former consultants to sue PTA, block spectrum auction

A lawsuit seeking a stay on the spectrum auction would mean further delay in the much-awaited and oft-delayed high-speed mobile internet services. CREATIVE COMMONS

KARACHI: 

The consultants hired by the former government of Pakistan Peoples Party, under then chairman of Pakistan Telecommunication Authority, Farooq Awan, are planning to sue the telecom regulator and block the spectrum auction until they are paid for their services.

“We are in the process of preparing legal documents to block the auction on several grounds, including non-payment of our bill and the fact that it will use some of our work without having paid us,” Martin Sims, one of the consultants told The Express Tribune.

This would be the first major challenge for the Pakistan Muslim League-Nawaz government that has had smooth sailing so far in the auction process. But regardless of who wins the legal battle, the general public will be the loser in either case.

A lawsuit seeking a stay on the spectrum auction would mean further delay in the much-awaited and oft-delayed high-speed mobile internet services. Payment to the consultants, on the other hand, would mean more than Rs50 million of taxpayers’ money going down the drain as the government has already signed a fresh contract with Value Partners Management Consulting Limited.

On November 23, 2012, PTA had hired Rob Nicholls from the Australian law firm Webb Henderson; Dennis Ward, the former spectrum auctioneer for the Canadian Spectrum Management Programme; and Martin Sims from spectrum specialists PolicyTracker to assist the regulator in carrying out a spectrum auction.

However, PTA’s Member Technical (MT) Khawar Siddiq Khokhar and Member Finance (MF) Nasrul Karim Ghaznavi opposed what they said were illegal appointments. The matter went to the National Accountability Bureau (NAB), which declared the hiring of consultants illegal and the PTA eventually terminated the contracts in December 2012.

This is not the first time the former consultants have talked about legal action against the PTA. They had engaged three Pakistani lawyers to recover the money earlier this year.

Taking a stay on the spectrum auction until the settlement of payment and legal action in British courts were some of the options they were considering back then. The legal action would mean that the PTA was liable not only for the unpaid fees, which amounts to Rs50 million, but also for the legal costs associated with the case, the consultants had told The Express Tribune in a joint statement.

Before their contracts were cancelled, the consultants had completed more than half of the work at their own expense, which includes travelling to and a four-week stay in Pakistan. The PTA didn’t confirm cancellation of their contracts until January 14, 2013, they said.

The consultants said they were not paid a penny for the work they had done. They were given individual cheques by the PTA for 10% of the agreed fee, but those could not be cashed as the regulator had already cancelled them.

“This is cheque fraud, pure and simple, and punishable by a jail sentence under Pakistani law,” consultant Sims told this correspondent in a previous statement.

“That is something only a court can decide,” said consultant Ward. “The PTA is legally obliged to honour contracts. It can’t appoint itself judge and jury and suddenly decide to pull out,” he said.

Barjees Tahir, former head of the National Assembly Standing Committee on IT and Telecom, had clarified that Awan, then PTA chairman, would have to pay the consultants from his personal account since he didn’t seek consensus by inviting views of other PTA members before the appointments.

The amount claimed by the consultants, it may be added here, is in addition to Rs20 million of public money the former government had spent in advertisements for hiring the consultants

RDB: Making it rain with Daddy Da Cash

Band member Surj on RDB’s latest collaboration with T-Pain, and their plans for the future.

KARACHI: 

He has a certain calm in his voice, and is both patient and enthusiastic. He listens intently to questions being asked and answers them thoroughly. The Express Tribune brings you an exclusive interview with Surj of Rhythm Dhol Bass (RDB). The British-Sikh duo, comprising of Surj and Manj has been around for a while. Their catchy, bhangra-infused numbers are both addictive and energetic, and a regular feature at most weddings this side of the globe.

Bollywood is no stranger to this eclectic duo. Songs like Tamanche Pe Disco, Sadi Gali andAloo Chat became mehendi anthems after their respective releases. “With Bollywood, there’s a certain sound, but with our own work we can play around and experiment with different flavours,” says Surj.

Daddy Da Cash is a standalone single that comes after a long line of numbers for Bollywood films. “We’ve been doing Bollywood for quite a while now, and we wanted to get back to doing our own stuff,” explains Surj. The song features none other than two-time Grammy award winning artist Faheem Rasheed Najm, more commonly known a T-Pain, whose notable hits include songs like Low, Bartender, Buy you a drank and  . Apple bottom jeans and boots with the fur, anyone?

The cheeky song digresses from the Bollywood/bhangra sound of their previous singles and item numbers. “We knew Daddy Da Cash would be an international collaboration, so we fine-tuned the song for that,” says Surj. “The style of the song is very Dirty South; it sounds like a track T-Pain would be on. It had to have a powerful global sound as we’re catering to an international audience with this number.”

On the subject of working with T-Pain, Surj was generous with his praise for the artist. “T-Pain is awesome! He went out of his way to break down boundaries, he was joking around on set, we had a great time with him,” says Surj.

The duo must have absolutely loved T-Pain, as they’ve recently presented him with a diamond and gold-studded auto rickshaw, which features a personalised name plate with T-Pain’s moniker engraved on it. RDB gave T-Pain the souvenir after the US star became fascinated by the mode of transport during his last visit to Mumbai.

RDB have already worked with a number of international artists such as Ludacris and Snoop Dogg in the past, and it sounds like they have a long bucket list for future collaborations. “There are so many artists we want to work with, Justin Timberlake, Eminem… Collaborating with Jay-Z would be a dream come true!”

RDB debuted Daddy Da Cash at the MTV India VMA’s back in March with a live performance featuring T-Pain. “He [T-Pain] was electrifying! He wanted to come to this side of the world and we thought this would be the perfect opportunity for him to do so,” he says. The reaction of the song at the event was unbelievable, according to Surj, and it has been performing well since its official release.

Surj says that fans should expect their fourth studio effort, Worldwide, to tentatively be released in the first quarter of the next year. For this album, RDB are looking to bring together rhythms from across the world, and are attempting to fuse genres like hip hop, dubstep, reggae, acoustic, EDM and Punjabi folk to create a fresh and current new sound. “The name of the album came about while we were touring, we felt a connection with the world, and how every place had its own unique sound, along with the fact that all music is so international these days,” he says. “Someone sitting in Russia has access to Bollywood music, the same way some in India would know who T-Pain is, and it’s amazing.”

RDB themselves are an ode to the international music scene. Born and bred in England, the band is as British as they are Sikh. “Being raised abroad gave us a different flavour and an understanding of Western culture,” says Surj. They grew up listening to musicians such as Michael Jackson and Snoop Dogg. Working with the latter after idolising him his entire youth was a dream come true for Surj. “It was brilliant, being able to work with Snoop Dogg. I’m a big fan of his music,” he says.

Their Sikh background has also had a great influenced on their music. “We’re very proud of who we are and our roots. We had to learn Punjabi, but it’s our first language now!” says Surj with a laugh.

RDB is also in talks with concert promoters in Pakistan. The duo hasn’t been touring too often since their brother and fellow band member Kuly passed away last year, but they feel that they are ready to change that now. “We want to reconnect with the fans we have in Pakistan,” says Surj. Tours have been fickle in the country, due to security concerns, but RDB hopes to perform here soon. “We actually go to Lahore quite often, we’re good friends with Mustafa Zahid,” says Surj. Zahid is the lead singer of Pakistani rock band Roxen, and RDB have jam sessions with him whenever they’re in the city.

The band has come a long way, facing both trials and triumphs, but with their new song it’s clear that they’re all set for a comeback. So, what’s next on the agenda for the band?

“We’re currently in talks with David Guetta, so hopefully that’ll work out,” says Surj with a chuckle.

As do we RDB. Imagine the dances one could choreograph to that

Snowden revelations may lead to spying curbs: Experts

Edward Snowden. PHOTO: REUTERS

WASHINGTON: Intelligence leaker Edward Snowden’s revelations about the scale of American eavesdropping have succeeded in triggering a fierce debate which could ultimately lead to limits on National Security Agency spying, experts say.

Snowden has been labeled a “traitor” by government officials but events this week signalled a possible vindication for the former computer contractor, who has always insisted he is a whistleblower trying to shed light on the NSA’s secret surveillance.

Six months since a stream of bombshell revelations began pouring out from Snowden, members of Congress are proposing new laws to rein in the NSA, a federal judge ruled one of its programs is likely unconstitutional and a panel handpicked by the White House has called for sweeping changes to electronic surveillance.

It is “undeniable that we’re having a series of debates about the appropriate limits of government surveillance that, without Edward Snowden, we would not be having,” said Stephen Vladeck, professor of law at American University.

“If Snowden’s goal was to spark a public debate I think he succeeded beyond his wildest dreams,” he told AFP.

Snowden, who has been granted asylum in Russia and faces espionage charges in the US, has expressed satisfaction that federal judge Richard Leon found the NSA’s collection of Americans’ telephone records probably violated privacy rights and that the snooping was “almost Orwellian” in scale.

“Today, a secret program authorized by a secret court was, when exposed to the light of day, found to violate Americans’ rights,” Snowden said after Monday’s ruling.

The most serious rebuke to the NSA came Wednesday from a panel of establishment figures named by the White House to review the surveillance operations that mushroomed after the attacks of September 11, 2001.

The panel, which included a career spy who served as acting director of the Central Intelligence Agency, Michael Morrell, called for imposing limits on the NSA’s powers, scaling back its secrecy and reforming the agency.

“We conclude that some of the authorities that were expanded or created in the aftermath of September 11 unduly sacrifice fundamental interests in individual liberty, personal privacy, and democratic governance,” the panel wrote in its report issued Wednesday.

The panel also called into question claims from US spy chiefs that the dragnet of phone and Internet traffic has kept America safe, saying the spying “was not essential to preventing attacks.”

The panel warned that privacy rights outlined in the Fourth Amendment to the US Constitution should not be sacrificed in the name of preserving security, but also said the government had a duty to protect its citizens.

The tension between those two principles is at the heart of the debate triggered by Snowden.

“I think the question is: what is the spirit of the Fourth Amendment as applied to the new technologies?” Vladeck said.

“That is the incredibly important and so far unanswered question looming behind the Snowden disclosures.”

Even the Director of National Intelligence, James Clapper, reluctantly acknowledged in September that Snowden’s leaks have generated a much-needed discussion about the parameters of eavesdropping.

More than a decade since the 9/11 attacks, the sweeping powers granted to the NSA by two successive presidents and lawmakers are now being re-examined, according to James Lewis, a former senior US official who worked on intelligence and cyber security.

“It’s painful to say but yes, Snowden triggered long overdue thinking about how we engage in intelligence collection,” said Lewis, a senior fellow at the Center for Strategic and International Studies.

Snowden’s leaks, however, also have damaged the US government’s ability to gather intelligence and that will carry unknown risks, he said.

Snowden evokes mixed feelings among Americans.

According to a Washington Post-ABC News poll last month, only 35 percent of Americans between the ages 18 to 30 say Snowden should be charged with a crime, compared with 57 percent of those 30 and older.

Rights activists believe the leaks have opened up a rare opportunity to enact major reforms but it remains unclear where President Barack Obama will come down on the panel’s recommendations.

For Snowden, the secrecy surrounding NSA spying represented a bigger threat than the surveillance itself.

“What we recoil most strongly against is not that such surveillance can theoretically occur, ” he wrote to Time magazine in an email interview, “but that it was done without a majority of society even being aware it was possible.”

Japan robot astronaut talks Santa in first chat with spaceman

Humanoid communication robot Kirobo (R) and Japanese astronaut Koichi Wakata exchange messages in their first communication session between a robot and a human being in space, at the International Space Station (ISS). PHOTO: REUTERS

TOKYO: The world’s first robot astronaut has begun chatting to the Japanese commander of the International Space Station, in what was being billed as the first conversation of its kind.

Kirobo, a pint-sized android equipped with artificial intelligence and capable of learning how to respond appropriately to humans, even put a marker down for Christmas, telling Koichi Wakata he expected a visit from a certain man bearing gifts.

“Santa Claus will come to space,” Kirobo, wearing a Santa hat, told Wakata as they drifted in zero gravity hundreds of miles (kilometres) above the Earth.

“What will you ask for from Santa Claus, Kirobo?” asked the Japanese astronaut.

“I want a toy rocket… let’s ask Santa Claus.”

The unscripted conversation, in Japanese, was held on December 6, with footage unveiled on Friday. It is part of a longer-term project to see how a robot can act as a companion for isolated people, particularly to see if it can develop conversational skills.

The wide-eyed and bootie-wearing Kirobo – roughly the size of a chihuahua – left Earth on a cargo-carrying rocket and reached the space station on August 10.

Wakata along with Mikhail Tyurin of Russia and NASA astronaut Rick Mastracchio joined him at the ISS in November.

“We’ve had some trouble before having the robot carry on the conversation smoothly,” said developer Tomotaka Takahashi.

“When people develop a relationship, it is an accumulation of small bits of communication. Small things make it work or not work,” he said. “We’ve learnt important tips to develop a robot that can communicate with people more.”

Kirobo and his interlocutor managed several minutes of spontaneous conversation aboard the ISS, which included the robot giving very general opinions.

“How was it when the rocket launched?” Wakata asked the machine.

“It was exciting!” Kirobo replied.

Kirobo and a twin android, Mirata, which stayed on Earth were created jointly by advertising firm Dentsu, the University of Tokyo, robot developer Robo Garage and Toyota.