Cricket World T20: Wasim tips Pakistan amongst favourites

Wasim during a press conference in Karachi on Tuesday. PHOTO: AFP

KARACHI: Former Pakistan captain and legendary paceman Wasim Akram on Tuesday tipped Pakistan as one of the top three favourites to win the World Twenty20 starting in Bangladesh next week.

The fifth edition of the World Twenty20 with 16 teams in competition will be held in Bangladesh from March 16 to April 6.

“For me Pakistan, India and the West Indies are top three favourites as they play this format well and have enough experience at their disposal,” Wasim said during a reception.

India won the inaugural World Twenty20 held in South Africa in 2007 while Pakistan won the second edition held in England two years later.

Hosts Bangladesh and Zimbabwe along with six qualifiers will open the first round of the fifth edition of the World Twenty20.

The top two teams from the first round will join the eight seeded teams in the second round which kicks off with a much-awaited India-Pakistan clash in Dhaka on March 21.

Wasim said an Indo-Pak match will be an ideal kick off to the main round.

“What else do you want as an opening match,” said Wasim, who will be commentating on the event. “Whenever Pakistan and India play, millions watch the game and there are no favourites in that match.”

Wasim said the Asia Cup finalists must enter the event with a positive frame of mind.

“Pakistan had a very balanced squad and all they need to do is to enter the event with a positive frame of mind,” said Wasim, who criticised Pakistan’s loss in the Asia Cup final to Sri Lanka last week.

Sri Lanka chased down a challenging 261-run target in 46.2 overs with opener Lahiru Thirimanne notching a brilliant 101.

Defending champions Pakistan had posted a tough 260-5 with Fawad Alam hitting a maiden hundred with 114 not out.

This was Sri Lanka’s fifth Asia Cup title, equaling India’s number of triumphs in the event initiated in 1984.

“I couldn’t sleep for two days as I failed to understand the manner in which we used our bowlers in the final,” said Wasim.

“I think in the first place the decision to bat first was not correct because Pakistan had chased well in the matches against India and Bangladesh and then defending a 260-plus total we didn’t use our bowlers well

9-month high: Rupee strengthens to 99 against dollar

Expects to gather $10.1 billion through remittances, auction of 3G licences and outstanding CSF payments. PHOTO: FILE

KARACHI: The US dollar depreciated against the Pakistani rupee, reaching a 9-month low, Express News reported on Tuesday.

The rupee-dollar parity now stands at Rs99.90 in the interbank market, decreasing by Rs1.52 today.

Speaking to The Express Tribune, Standard Chartered Bank Senior Economist Sayem Ali had said the rally is driven more by sentiments, as macros remain largely weak.

“Sentiments have shifted due to positive IMF staff reviews, expectations of significant aid and investment inflows in 2014, and interventions by the State Bank of Pakistan (SBP) through the forward/swap market,” Ali had said.

An inflow of investment in fiscal year 2013-14 also helped shift market sentiments in favour of the rupee. According to the SBP, Pakistan received foreign direct investment (FDI) of $523 million in the first seven months of 2013-14. FDI amounted to $106.9 million in January alone.

In addition, the expected receipt of $550 million from the International Monetary Fund (IMF), along with the launch of Eurobonds amounting to $500 million likely next month, has also led to positivity in the foreign exchange market.

While appreciation of the rupee will contain inflation, a stronger currency will inevitably make exports less competitive.

“Hence, a widening trade gap will put more pressure on foreign exchange reserves, forcing the SBP to readjust the rupee to equilibrium levels,” Ali had noted.

22,000MW of electricity to be added within 7 years: Iqbal

Federal minister for planning, development and reform Ahsan Iqbal speaking at the International Marketing Congress (Marcon). PHOTO: PPI

LAHORE: The government has signed energy generation projects with China through which 22,000 megawatts (MW) of energy will be added to the system in the coming five to seven years, said Federal Minister for Planning and Development Ahsan Iqbal.

The country’s total energy production is 22,000MW, with the same amount being added to the grid in this time span, Iqbal said, while speaking at the International Marketing Congress (Marcon).

The government is focused on overcoming the development lag of the last 14 years, he said, adding that the government was turning towards China as its Foreign Direct Investment was very low in the context of the relations the two countries enjoy.

To strengthen economic cooperation, Pakistan has signed an agreement for the development of the Karakoram Highway, construction of six lane Mansehra-Islamabad and Lahore-Karachi Motorways. Through this, the country will be connected to the North-South corridor. Construction of a modern Airport in Gwadar, linking of the Gwadar deep sea port to the northern part of the country is also part of the plan. Through this, Pakistan will become a connecting bridge for the North-South and East-West regions and play a pivotal role in regional connectivity and development, Iqbal said.

Development in Gwadar and the Gadani coal generation project will start a new era of prosperity and economic development in Balochistan, said Iqbal, adding that the Thar Coal power generation project will change the fate of the people of Sindh.

Iqbal said that the government’s vision is to bring about an industrial revolution in Sindh through Thar coal as reserves there could generate electricity for the next 200 years.

Poverty, unemployment, law and order issue, hopelessness is the main tides faced by the government and we are committed to turn these tides during the next five years, he stated.

Iqbal believed that Pakistan has been run on the ‘sale paradigm’ and the time had come to shift to the ‘marketing paradigm’. The government is focused on producing and exporting items which were in line with international market requirements, Iqbal said.

Relief for auto part vendors: Govt paves way for withdrawal of 2% additional sales tax

Ishaq Dar in a meeting with Pakistan Association of Automotive Parts Accessories Manufacturers (PAAPAM) on Monday. PHOTO: PID

ISLAMABAD: 

The federal government agreed on Monday with auto part vendors to treat their sales to car assemblers as input instead of value-addition, paving way for the withdrawal of 2% additional sales tax being charged from vendors.

The understanding was reached during a meeting between Finance Minister Ishaq Dar and representatives of the Pakistan Association of Automotive Parts Accessories Manufacturers (PAAPAM).

“The finance minister acknowledged that the imposition of an extra tax of 2% on sales of auto parts to automobile manufacturers by auto parts manufacturers constitute a hardship for the industry and may have the undesired effect of escalation in the prices of vehicles,” according to an official handout issued by the ministry.

Paapam Chairman Usman Malik stated during the meeting that the additional 2% tax on items sold in retail markets was leading to an increase in vehicle cost.

Dar agreed with the assertion that sales made by auto parts manufacturers to automobile manufacturers were not to be treated as retail sales and it was not the intention of the Federal Board of Revenue (FBR) to subject these sales to extra tax.

Dar directed FBR Chairman Tariq Bajwa to institute a case for removing the anomaly in the taxation system.

While talking to The Express Tribune, Bajwa maintained that the government was not withdrawing the additional tax but merely issuing interpretations of law that will help treat the auto parts supplies as inputs instead of value-addition.

The association also proposed the federal government to levy 5% tax on the transfer of vehicle within six months of new purchases, a move aimed at discouraging hoarding and curtail the dealers’ practice of earning money by creating an artificial shortage.

Bajwa said the government may consider the proposal at an appropriate time.

Meanwhile, the association expressed concerns over the government’s decision to completely normalise trade ties with India and sought protection against opening the auto sector to Indian firms.

Dar directed officials of the Ministry of Industries and Engineering Development Board (EDB) to hold a meeting with the stakeholders of the automobile industry in order to resolve issues.

The Finance Minister also directed officials of the Ministry of Commerce to hold a meeting with the automobile industry representatives and present a report within one month on issues related to the Ministry. He assured Paapam that the recommendations will be considered in the next financial year 2014-15.

Malik gave a detailed presentation to Dar on the current status of the Pakistan automobile industry and its future potential. He said that there were 13 vehicles per 1,000 persons in Pakistan, while in Indonesia and Brazil the numbers 79 and 259 per 1,000 persons respectively.

Probably, what he did not highlight the fact that affording a vehicle in these countries was easier than in Pakistan where car manufacturers were fleecing customers.

Exports increase 18% YoY

The trade deficit was recorded at $1.43 billion in February 2014, lower by 7.5% or $115 million when compared with February 2013, showed the trade summary released by the PBS. PHOTO: FILE

ISLAMABAD: Pakistan’s exports increased dramatically by 18% in February compared with the corresponding month last year, almost three times more than the growth in imports, clocking in at $2.2 billion, according to the Pakistan Bureau of Statistics (PBS).

The growth in imports was recorded at 6.4% in February over the corresponding period of the previous year. Due to exceptional growth in exports, the trade deficit contracted in February compared to the same month last year, according to the PBS.

The trade deficit – gap between imports and exports in trade of merchandise goods− was recorded at $1.43 billion in February 2014, lower by 7.5% or $115 million when compared with February 2013, showed the trade summary released by the PBS.

In February 2014, imports stood at $3.6 billion, which were 6.4% or $217 million higher than the imports in February 2013.

For the first time in recent months, the monthly import bill has remained lower than official foreign currency reserves held by the State Bank of Pakistan (SBP). The SBP’s reserves stood at $3.9 billion by the end of February as a result of ‘aid’ given by ‘friendly countries’ to the Pakistan Development Fund (PDF), established after the changing geopolitical situation in gulf countries.

Meanwhile, the Pakistani currency continued appreciating against the United States (US) dollar. On Monday, the inter-bank rate further came down to Rs102.2, thanks to contributors of the PDF.

The terms of trade are expected to improve further in coming months, if the exporters are able to fully exploit the benefits offered to them under the duty free access to the European Union markets, according to analysts. The Generalised System of Preference Plus facility became effective from January.

On a month-on-month basis, the trade deficit in February over January dramatically contracted 31%. The trade deficit was $1.43 billion in February, $643 million lower than the trade deficit posted in January. Exports grew 5.2% month-on-month while imports contracted 13% in February over January, according to the PBS.

For the period from July-February of the fiscal year 2013-14, the trade deficit stood at $12.6 billion, which was 4.9% or $645 million less than the deficit the country posted in the corresponding period last fiscal year, according to the PBS.

Import payments in the period under review were $29.4 billion, $339 million or 1.2% higher than the payments made in the comparative period of the previous year, according to the PBS.

Exports during July-February remained at $16.9 billion as compared to $15.9 billion of the previous year, showing growth of 6.2% or $984 million.

For the current fiscal year, the government has targeted increasing exports to $26.6 billion and estimated that its import bill will remain at $43.3 billion, showing a gap of $16.7 billion in trade of merchandise goods.

Canadian oil firm wraps up Pakistani operations

AROL had a non-operating 10% working interests in Gambat South, Naushehro Feroz and Kotri North exploration blocks in Pakistan. PHOTO: FILE

ISLAMABAD: 

As Canadian-based firm Asia Resources Oil Limited (AROL) decides to divest interest in all its assets in Pakistan, Pakistan Petroleum Limited (PPL) has decided to acquire shares in three of its fields with potential reserves of tight and shale gas.

Several foreign firms have sold their assets in Pakistan due to poor law and order situation, low incentives and bureaucratic hurdles. AROL will add to the growing list.

The government is heading to form a subsidiary of PPL to acquire AROL’s assets. The three blocks are identified by PPL as ideally located in the unconventional exploration fairway of the Middle Indus Basin for tight and shale gas. PPL is spearheading the unconventional exploration initiative in the country, acquiring these blocks of strategic value to kickstart the exploration programme.

Sources said that the petroleum ministry had moved a summary to the Economic Coordination Committee (ECC), seeking approval for forming the subsidiary and acquiring AROL assets in Pakistan.

AROL, a British Virgin Islands (BVI) registered company with an office in Calgary and non-operating 10% working interests in Gambat South, Naushehro Feroz and Kotri North exploration blocks in Pakistan, is divesting its interest in all its assets. PPL, being the operator and a majority interest holder in the three exploration blocks, has an agreement with AROL on right of first refusal upon divestment of AROL’s working interests in the blocks. This means that in the event of AROL selling its stake, PPL will have to be offered the sale before the open market.

In Gambat South Block, PPL recently made two successive hydrocarbon discoveries and plans to drill further exploratory and appraisal wells. In Naushehro Feroz Block, drilling of an exploratory well is currently in progress. Furthermore, drillable prospects have been identified and land acquisition for drilling site is in progress in Kotri North Block.

Petroleum ministry had informed the economic decision-making body that the proposed acquisition by PPL would protect the three assets from being sold by AROL to small entities thereby creating hindrances for PPL in the fast-paced exploration required in these blocks. Moreover, through this acquisition, it would become relatively easier for PPL to raise foreign currency project financing for partly meeting the Gambat South field development costs.

The ECC has been informed that it is therefore of strategic national importance for PPL to acquire the 10% working interest and restructure it to source unconventional exploration technology through it from Canada.

For the corporate acquisition of AROL and three target assets through PPL’s wholly-owned subsidiary, an investment will be required to meet the immediate acquisition cost and for the subsequent exploration and appraisal plan costs for the Gambat South discovery. This amount will be injected by PPL in the form of equity contribution to PPL’s wholly-owned subsidiary.

The acquisition will contribute significantly to the long-term energy security of the country by enabling technology transfer in exploring unconventional hydrocarbon reserves (shale and tight gas).

The petroleum ministry has sought the ECC’s approval for equity investment by PPL. It had also sought approval of external debt financing in foreign currency which may be wholly or partly secured through PPL’s assets in Pakistan.

Freight charges: ECC likely to rule in favour of Pak Arab Refinery

The Inland Freight Equalisation Margin allowed the government to ensure a uniform price for fuel across the country by distributing the cost of transport equally. PHOTO: FILE

ISLAMABAD: 

The Economic Coordination Committee (ECC), scheduled to meet today, is likely to direct the regulator to implement the decision by the previous government to allow Pak Arab Refinery Limited (Parco) to charge freight on High Speed Diesel (HSD), leading to an increase of Rs0.18 per litre in its price.

It may be noted that Byco refinery had already approached the Competition Commission of Pakistan (CCP) over discriminatory treatment of Inland Freight Equalisation Margin (IFEM) incentives to the refineries. They had quoted the examples of Parco and Attock Refinery which were allowed to charge IFEM.

Sources told The Express Tribune that Oil and Gas Regulatory Authority (Ogra) had not implemented the decision of the previous government, saying that Parco had already reaped hefty profits due to incentives given by the federal government. The regulator had recommended that the decision regarding freight charging on HSD by Parco should be deferred until the complete deregulation of upstream and midstream sector.

“The estimated annual impact of crude transportation reimbursement on HSD will be Rs1.26 billion and per litre incidence on the HSD price will be Rs0.18 per litre. Existing annual crude reimbursement on Motor Spirit (MS) and Light Diesel Oil (LDO) is Rs945.37 million,” the regulator said.

Ogra said that since its establishment the Parco refinery had been given various protections/incentives by the federal government including a 25% guaranteed return regime and import parity price (IPP) price based on its implementation agreement and petroleum policy 1994. As a result, Parco had been earning a handsome pre-tax profit, earning a total profit of Rs74.88 billion till financial year 2011-12.

As per its IPP, Parco was allowed to include applicable inland freight from Karachi to Parco’s refinery in its ex-refinery price till the same were regulated. However, after controlled deregulation in June 2011, Parco was allowed to include crude pipeline transportation rates in its ex-refinery prices of MS, LDO and High Octane Blending Component (HOBC) instead of the applicable road freight on the same.

This decision resulted in passing the benefit of deregulation to the consumers and prevented Parco from charging higher road freights.

“In view of the federal government’s policy of liberalisation/deregulation in the petroleum sector, it is recommended that Parco crude transportation cost recovery on petroleum, oil and lubricants (POL) products should be deferred till complete deregulation of petroleum prices in the midstream and upstream sector. This proposal will add to the HSD price about Rs0.18 per litre which is not appropriate keeping in view the profitability of the refinery,” Ogra said.