NTC signs Telenor for Online Services

on 20/07/2017

The National Telecommunication Corporation (NTC) and Telenor Pakistan have signed an agreement for provision of telecom services to NTC customers across Pakistan, through their mobile network. Under the agreement between NTC and Telenor, Telenor will provide services like internet dongles, mobile handsets and SIM cards to provide 3G/4G GSM and data services in areas where NTC infrastructure is not available. The signing ceremony was attended by Brig (r) Viqar Rashid Khan, MD NTC, and Irfan Wahab, CEO Telenor Pakistan. NTC is the official IT and telecom service provider for the Government of Pakistan and has been granted Integrated LDI License to provide ICT services to armed forces, defense projects, federal government, and provincial governments or as the federal government may determine. Telenor Pakistan has reported a subscriber base of over 36 million, making it Pakistan’s second largest mobile operator. It is the first operator in Pakistan to establish a Cloud Based National Data Center for the public sector. The corporation has witnessed unprecedented financial growth of 359 percent during 2015-16 and an increase in broadband subscriber base by 36 percent. It has extended its services from 54 districts and cities to 87 including underdeveloped districts in Sindh and Baluchistan.  The number of exchanges were increased from 139 (in 2012- 13) to 260 in 2016, thereby overall 87% increase. It utilized 99 percent of its ADP budget in FY 2016-17. Also, NTC is the first to use M2M and P2P networks for extending fixed lines and data connectivity. NTC has already resumed the international gateway operations. Large scale Wide Area Networks of CDNS, Election Commission, State Bank, AGP and other strategic organizations have been established. Pertinent to mention that, NTC has also signed a Service Provider License Agreement (SPLA) with Microsoft to provide SaaS in the country through its cloud based National Data Centre. NTC is pursuing strategic partnership with private operators in the telecom industry to bring new services for its subscribers. The Chairman said NTC is the first in the country to introduce new apps like Go-Smart for its customers and have extended 3G/4G Mobile data connectivity to its subscribers under public private partnership. MD NTC further briefed about the future plans and projects of NTC. These include establishment of strategically vital submarine cable landing station at Gwadar as an alternate route to existing network. NTC further envisions expanding its network to all districts of Pakistan within the next 3 to 4 years.

People asked to vacate weak buildings

on 20/07/2017

 

Karachi has 354 weak buildings

A number of 354 buildings in Karachi has been declared ‘dangerous’ by concerned authorities and people living in these buildings have been advised to vacate them and relocate themselves somewhere else to protect themselves from any harm, if the building/s collapsed during upcoming rains. Sindh Building Control Authority Director General Agha Maqsood Abbas said in a recent statement that a technical committee, comprising engineers and architects, had after a survey declared these  354 buildings dangerous.He said the committee was continuing the survey and if more such buildings are identified, these too would be notified as dangerous.He urged the people to come forward and inform SBCA, about any building or structure in their vicinity that look dangerous and are in a dilapidated condition so the committee could review and examine it and issue a statement about its health/ life.

Understanding Chinese’ entry in Pakistani Market

on 19/07/2017

I think the prevalent questions in the minds of Pakistani society regarding CPEC are that what will be the consequences of Chinese entering the domestic market? Either they will occupy the whole market by monopolising it or they will compete fairly in the market or they will destroy our domestic manufacturing industry by pumping lower priced China-made products into the market?

In my opinion basic Economics can be a great help to cater all these questions and following points seem important in this regard. Is import good for our society or bad?

The answer to this question depends on our understanding of what does it mean for a product or service to be good or bad for a society? What are the needed attributes in a commercial product being sold in a market? Either it is the standard of living of the Pakistani citizens which matter or the so-called national prestige which becomes high when we see the products mentioning “made in Pakistan”?

If it is the standard of living which is valued then decrease in the price level escalates the standard of living of the people because it increases our purchasing power. For example, I have Rs20 and I need to buy bread for my daily meal. The price of one slice of bread is Rs5, so I will get four slices by paying Rs20. Supposedly, the price of one slice decreases to Rs4, what will happen then? In fact, I will be able to buy five slices. Now we again suppose that the price of a bread jumps to Rs7. Now, my purchasing power will be decreased and I will get only three slices of bread. So, the benefit of society is in low priced items. The fewer consumers will spend, the more they will save which result in more investment. If a consumer wants to spend all her disposable income, then she will buy more items (less in basic needs and more in luxuries).

Is foreign investment good or bad?

Foreign investment is always good for an economy. It increases the know-how in the society by inserting advanced knowledge and technology. Important thing is that workers learn new things from their repetition of tasks and from the innovative practices introduced by entrepreneurs or foreign firms. Similarly, when a foreign firm introduces new ideas and practices in the society, their employees learn from them, it increases the rate of entrepreneurship because some employees leave their job and start their own business which they have learned from their experiences.

Ricardo Hausman writes this in the following words:

“The key to [Progress) is tacit knowledge. To make stuff, you need to know how to make it, and this knowledge is, to a large extent, latent – not available in books, but stored in the brains of those who need to use it……new firms are formed mainly by workers who leave other successful firms, taking the relevant tacit knowledge with them. The reality is that people learn more by performing and repeating tasks, better than mere reading books in Academics.”

Remember that local businessman has more competitive advantage than a foreign one because he knows more about the local environment. Bangladesh’s textile industry is a beautiful case study in this regard which shows that foreign investment increases the comparative advantage of the local firms. It increases total production of the society. It creates more jobs and opens more opportunities for entrepreneurs which definitely increase the standard of living of the people.

More investments mean the pie of the economy enlarges. The economy is not a fixed pie. The new entries in the market do not mean that new entrants will disentitle local firms from their fair shares in the market. When Chinese businesses will enter the market, they will definitely search the opportunities in which they have more competitive advantage. While local businesses will search the opportunity in which they can contribute better than their Chinese competitors. Be confident that our business community has the potential to do it and foreign competition will further enhance it.

The important thing to be more concerned about CPEC is not the foreign competition but the term s and conditions of the deal, and the risk of monopoly if it is being granted by the state to the investors. We should keep our focus on the incentives being provided to them. Either they are coming to join us and compete with our local firms just like other foreign investors do or they will be treated differently from Pakistani investors with more privilege? There should be no special treatment or special incentives to any firm either it is local and foreign. The monopoly of any kind will destroy our economy, politics and society, and we will be in big trouble in future. We must be very careful and cautious by asking critical questions to the government on behalf of our civil society.

(The writer is an economist in a public policy think tank PRIME based in Islamabad).

ADB to continue support Pak infrastructure – road projects

on 17/07/2017

Asian Development Bank (ADB) Vice President Wencai Zhang said in July that the bank would release almost two billion dollars loan to Pakistan during ongoing financial year 2017-18. He said that currently ADB is disbursing around $1.5-$1.6 billion annually to Pakistan. However, the ADB is trying to do more, as the Bank would release nearly two billion dollars in the current fiscal year. The ADB would provide $6 billion to Pakistan under the three-year (2018-20) operation plan. The government of Pakistan is asking us to disburse $2.5 billion annually, said Vice President ADB, who is currently visiting to Pakistan to discuss ADB’s development partnership with the Pakistan’s economic team. He met with Finance Minister, Railways Minister, Planning and Development Minister, Water and power minister and chairman NHA. “In coming years we will continue to support projects and especially infrastructure and road projects as traditionally a lot of projects have been done,” Wencai Zhang said while talking to journalists. Wencai Zhang said that stable political situation in Pakistan is important for reforms and development of the country. Political stability is always important for the economic development of the country. “It will be the government of Pakistan to decide to approach IMF after the upcoming general election. However, the ADB would continue to help Pakistan in reforms in power sector and public sector entities after the general election,” he replied to a question. He appreciated the economic gains achieved by the incumbent government during last four years. He said that Pakistan had completed three years IMF programme, improved macroeconomic situation and achieving higher economic growth. However, he emphasised to continue the ongoing structural reforms to consolidate the economic gains. The country needs to achieve economic growth of 7 percent in next few years, which is achievable, he added. Vice President of Asian Development Bank said that they are exploring social sector for investment. Health, education, and water resource management are so important for the economic growth of the country, he explained. The ADB is currently financing the power sector and public sector entities reforms in Pakistan. “We will see other public sector entities like Pakistan International Airlines and Pakistan Steel Mills if government asks for financing,” said former country director Werner Liepach, who was also present on the occasion. The ADB has supported China Pakistan Economic Corridor (CPEC), which is very helpful in regional integration. He said that ADB is interested to finance the projects of Pakistan Railways. Earlier, Wencai Zhang called on the Finance Minister Ishaq Dar. The Vice President said that development cooperation has expanded between Pakistan and ADB during the last few years, which has resulted in impressive levels of approvals and disbursement of aid from ADB to Pakistan in FY 2016-17.He said that ADB is interested in learning more about the government’s new initiatives, including the Pakistan Development Fund (PDF) and the Pakistan Infrastructure Bank (PIB), with a view to potentially collaborate on them with the government. The Vice President said that the ADB’s recent experience of policy-based lending for reforms in Pakistan has been very successful. Both sides agreed to identify further areas where reforms are required, which may be good candidates for policy based lending. The areas that are being explored in this regard include governance and public sector enterprise reforms. He reiterated ADB’s commitment to supporting development initiatives in Pakistan. The finance minister appreciated the role of ADB as a development partner for Pakistan. He congratulated the Vice President on ADB’s 50th Anniversary, and appreciated the Vice President’s visit to Pakistan to celebrate the anniversary. He appreciated contributions of former Country Director, Werner Liepach, and the progress made in a short time by current Country Director, Ms. Xiaohong Yang. The finance minister said that, after having achieved macroeconomic stability, the government is now focused on achieving higher, sustainable and inclusive economic growth. He said that federal PSDP of Rs. 1,001 billion for FY 2018 is over three times higher than federal PSDP for FY 2013. He highlighted that provincial transfers have increased significantly due to increase in tax collections during the last 4 years, and as a result, the provinces are in good fiscal shape. He said that both ADB and the Government of Pakistan must work together to further strengthen this relationship. He appreciated ADB’s interest in participating in the government’s initiatives, such as PDF and PIB, which will enable mobilization of resources for further infrastructure projects in the country. The finance minister said that the Government of Pakistan will continue to work closely with development partners on initiatives aimed at improving the quality of lives of the people of Pakistan.

CDWP approves 17 Developmental Projects

on 17/07/2017

Central Development Working Party (CDWP) has approved 17 development projects worth Rs178.3 billion. It also forwarded 6 mega projects, including RBOD-I-II and III to the Executive Committee of National Economic Council (ECNEC) for further approval. The approved projects are of transport & communications, energy, water resources, information technology, higher education, physical planning & housing, health and governance sectors. The meeting was chaired by Federal Minister and Deputy Chairman Planning Commission, Ahsan Iqbal and was attended by officials from different ministries and provincial governments. The body gave go ahead to Right Bank Outfall Drain I, II and III worth Rs90.2 billion and recommended it to ECNEC for further approval. The cost of RBOD-I is Rs17.5 billion, RBOD-II Rs61.9 billion and RBOD-III Rs10.8 billion. The project was referred by ECNEC to CDWP for revision and reconsideration. The RBOD-II project was reconsidered by the CDWP in March 2017 wherein the financing mechanism of flood component of RBOD-II was discussed in detail. After agreement by the Sindh government to share the flood protection cost (Rs7 billion), the project was approved by CDWP. In transport and communication sector, CDWP recommended three projects of Rs43.2 billion to ECNEC.CDWP recommended CAREC (Central Asia Regional Economic Cooperation) Corridor Development Investment Program Tranche-I Projects to ECNEC for approval. The project is part of CAREC Corridor road network 5 & 6 which connects Pakistan up north to China and west through Afghanistan respectively.The Rs24.7 billion Asian Development Bank financed project envisages improving 208 km of N-55 road in three sections including Petaro to Sehwan Section dualization, 128 km, Ratodero to Shikarpur Section dualization, 44 km, including construction of 2 km bypass at Lakhi town to avoid huge cost of land and impacts of resettlements and rehabilitation of existing dual carriageway from Darra Adam Khel to Peshawar Section, 36 km. Construction of Shaheed Benazir Bhutto Bridge over Indus with Guide Banks linking N-5 with N-55 including approach roads worth Rs9.8 billion was also approved by CDWP. The revised project envisages construction of 1.2 km and 11.9 meter wide two lanes single carriageway bridge across River Indus, connecting district Ranjanpur (Mithankot), located on the National Highway (N-55) with district Rahim Yar Khan (Chachran), located on the National Highway (N-5). Another project in transport & communication sector that CDWP forwarded to ECNEC for further approval is Rs8.6 billion project for the construction of Chitral – Garam Chashma – Doraha Pass Road (82.5 km). The project envisages construction, rehabilitation, improvement and widening of existing 82.5 km and 3.65 meter wide road to a width of 7.3 meter of Chitral – Garam Chashma to Doraha Pass. The scope of work also includes elimination of major causeways to have all weather road, construction of 10 km new road on other side of Lutkho River for tourist activities with allied facilities & stretches. The project has been taken up as a result of announcement of the Prime Minister during his recent visit to Chitral. In physical planning & housing sector, CDWP approved two projects worth 29.4 billion. In physical planning, CDWP recommended Punjab Intermediate Cities Improvement Investment Program’ worth Rs27.2 billion to ECNEC. The project includes transforming the selected urban areas of Sailkot and Sahiwal into green, inclusive, resilient and comparative smart cities with improved livability supporting social and economic growth through improved municipal governance, integrated urban planning, improved service delivery, efficient local mobility and climate resilient infrastructure and introduction of IT for city service delivery improvement with the framework of SMART City. The chair recommended cost rationalization for this project to be completed with the support of Asian Development Bank. Similarly, the CDWP also approved the project of Rural Sanitation through Saaf Suthro Sindh (SSS). This Sindh government project of 2.2 billion rupees would be financed by Asian Development Bank. CDWP further approved two projects in information technology sector worth Rs 2.7 billion. It includes e-office (basic common applications) replication at divisions of federal government. The e-office or e-filing system comprising of six modules which were developed as pilot project at ministry of information technology, including internal communications & movement of files, human resource management system, inventory & procurement management system, project management system, finance, planning & budgeting, internal portal. Ahsan Iqbal instructed to ensure CDWP meetings to be held through e-office system in future. Another IT sector project approved includes Pakistan Post Reform Initiatives: Automation of Post Offices. The proposed project will facilitate Pakistan Post and improve public service at its business units. This will also provide value added services including Online Post Stores, Mobile Card Top-Ups through Mobile Companies to Pakistan Post clients in future. Automation of Pakistan Post will improve financial control, ensure accurate assessment of budget estimates, improve customer service, decrease workload on Pakistan Post staff and extend additional facilities to public. The project would be completed through Korean soft loan. The Planning Commission Forum approved Rs104.7 million energy sector project ‘Hiring Consultancy Services for Third Party Validation of Neelum Jhehlum Hydropower Project. The project will broadly include validation of actual cost incurred under various phases, assessment of cost of various activities as per awarded contracts and evaluation, assessment of delays and cost overrun thereof, in order to determine value for money. Minister Ahsan Iqbal instructed to prepare ToRs to ensure realistic and clear evaluation of the project. The meeting also approved three projects in health sector worth Rs1.2 billion which include strengthening of health services Academy, Islamabad, establishment of safe blood transfusion services project phase II, KP and establishment of medical device development center (MDDC) at NUST. The MDDC project envisages of development of medical devices including stents. CDWP approved a Rs 2.4 billion agriculture project promotion of olive cultivation on commercial scale in Pakistan besides giving go ahead to Economic Affairs Division project ‘Strengthening of External Debt Management worth 64 million. In education sector, CDWP approved three projects worth Rs9.7 billion, including Award of Scholarship to Students from Gwadar, Science Talent Farming Scheme and mega project ‘Award of Allama Muhammad Iqbal 3000 Scholarships to Afghan Students’. Under the project Award of Scholarship to Students from Gwadar, students will be facilitated to get higher education at Pakistan’s universities and learn Chinese language abroad. Under the project Award of Allama Muhammad Iqbal Scholarships to Afghan Students’, 3000 students would be facilitated to get higher education in Pakistan’s universities. The project also envisages short professional training to Afghan civil servants.