Pakistan to set up Infrastructure Bank

on 08/05/2017

Government will set up Pakistan Infrastructure Bank with a paid-up capital of one billion dollars to finance private investors in development projects, said Finance Minister Ishaq Dar. “Both the International Monetary Fund (IMF) and government will hold 20 percent stake each in the proposed Bank, while international organisations, such as International Finance Corporation, will have the remaining shares,” Dar told a press briefing with the Pakistani media towards the end of his current visit to Washington DC. He gave a detailed round up on the plenary sessions with the IMF and World Bank during the briefing. He was on a five-day visit to U.S. to attend the spring meetings of IMF and the World Bank. The government would soon be launching Pakistan Development Funds. The shares worth Rs100 billion of the Fund would be offered to Pakistani diaspora in order to effectively channelise their valuable remittances. Later on, the Fund’s shares would be enlisted on the Pakistan Stock Exchange. “After success of sukuk bonds, Pakistan Development Fund would be another attractive investment for overseas Pakistanis,” he added. The government is consulting with the World Bank to introduce solar energy, as a new electricity generation alternative, at a lowest cost in Pakistan. World Bank remained bullish on Pakistan’s growth prospects for the next three years, revising its earlier projection notches up on large cross-border infrastructure investment, reforms and restoration of investor confidence. The bank, in its flagship report, forecast the GDP growth in the South Asia’s second biggest economy at 5.2 percent for 2017. It added that the growth is expected to accelerate from 5.5 percent in 2018 to 5.8 percent in 2019, “reflecting improvements in agriculture, infrastructure, energy and external demand.” IMF, in its world economic outlook, forecast the country’s growth at 5 percent in 2017 and 5.2 percent in 2018, supported by ramped-up infrastructure investment. The Asian Development Bank is also bullish over the country’s economic prospects this fiscal year, upgrading its growth forecast to 5.2 percent on improved energy supply and security and rising investment. The minister said the global credit rating agencies have upgraded the rating of Pakistan from ‘negative’ to ‘stable’ and from stable to ‘positive’ over the years to an extent that the country is likely to be included in G-20 countries by 2030.

An engineering marvel of the century! NEELUM JHELUM Project set to produce power next year

on 07/05/2017

Chairman Water and Power Development Authority (WAPDA) Lt. Gen. Muzammil Hussain (R) has said the first unit of the project is planned to commence electricity generation by end February 2018 A communication said the second phase would begin in March and the third and fourth in April 2018. The project will contribute about 5 billion units of electricity to the National Grid every year. The 969 MW-Neelum Jhelum Hydropower Project (NJHP) is scheduled to attain a major landmark, when the second Tunnel Boring Machine (TBM) will achieve breakthrough of the Right Headrace Tunnel. The target set to achieve during the last week of April, marking the completion of excavation of over 68-kilometer long tunnel system of the project. The breakthrough of Left Headrace Tunnel was achieved in October 2016. To review the ongoing construction work on various sites of the project, Hussain today visited the under construction NJHP in Azad Jammu and Kashmir (AJ&K). Speaking on the occasion, the Chairman said that it is a matter of satisfaction that overall progress on the project as of now is 92 percent, and the project is heading towards its completion in accordance with the stipulated work plan. During his visit to the headrace tunnel, the Chairman was briefed that following excavation of the tunnels, the water way system will enter the final phase which is scheduled to be completed in seven months. Thereafter, the tunnels will be ready to divert water from Dam site to the Power House. It was further briefed that impounding of the Reservoir will commence during October this year. Chairman WAPDA said that once completed, NJHP would be an engineering marvel of the century. It is worth mentioning that the first unit of the project is planned to commence electricity generation by end February 2018, second in March and the third and fourth in April 2018. The project will contribute about 5 billion units of electricity to the National Grid every year. (PR)

Chinese company to set up cross-border telecom infrastructure

on 07/05/2017

China Telecommunications Corp will set up resources to complete cross-border telecom infrastructure initiatives including the China-Pakistan information corridor, China-Laos-Thailand and China-Bangladesh-Myanmar-India projects. “Cross-border telecommunication infrastructure is one of the first steps for international cooperation,” Deng Xiaofeng, CEO of its international unit China Telecom Global Ltd said. “Our experience in deploying one of the world’s largest information networks in China can help narrow the digital gap,” he added. The company will invest more than $1 billion over the next three to five years to expand its presence in the economies along the Belt and Road Initiative including Pakistan. He said it will also raise more money from state-owned financing institutions and private investors, in a move to build land cables, internet data centers and other infrastructure in Southeast Asia, Europe and other regions. “State-owned and private capital are now keen to be part of our efforts. We also need their expertise to help us evaluate whether the plans are plausible,” Deng added. Deng said the company did not exclude the possibility of investing in foreign telecom carriers to help other developing countries accelerate the development of 4G. But Deng did not disclose more details. As of 2016, China Telecom has more than 4,700 overseas employees, with branches and offices in 30 countries and regions, most of which are along the Belt and Road. It has already built 13 internet data centers in six of them. According to data from the International Telecommunication Union, the Asia-Pacific region scored 4.58 in informatisation level in 2016, lower than the global average of 4.94. Xiang Ligang, a telecom analyst and founder of the telecom industry website cctime.com, said China Telecom was one of the first Chinese telecom carriers to go global, with the push starting in the 1990s. “Its expansion plans will also help more Chinese telecom equipment makers venture into overseas markets,” Xiang said. China Telecom expects that China’s plan to help economies along the Belt and Road improve telecom services will create a market worth $10 billion to $20 billion for the telecom industry over the next five years.

Plan to revive sick textile unit gets nod

on 07/05/2017

The National Assembly`s Standing Committee on Finance has supported the proposal by the textile sector to restructure bank loans of sick units to help their revival. Members of the textile sector informed the committee that the revival of sick units will earn $1 billion in foreign exchange and create five million jobs. Committee chairman Qaiser Ahmed Sheikh noted that exports have declined from $25bn to $20bn in the last four years and the decrease will continue if its basic causes are not addressed. The representatives of the textile sector identified a high cost of LNG, non-clearance of refunds and government borrowing by banks as major causes that led to the decline in exports. Committee members noted that the government borrows heavily from banks and leaves no space for the private sector to obtain loans. The meeting was also informed that exports from Bangladesh have increased from $24bn to $34bn.

Sialkot Businessmen demand Parallel Support Industry

on 06/05/2017

Pakistan’s vibrant export hub, Sialkot, has asked the economic managers of the country to establish a parallel support industry to encourage businessmen and investors to play their part in a bid to complement the existing manufacturing setup of the country. “The support industry will help the export-oriented industries to cut their costs thereby reducing the import bill of the country,” said Sialkot Chamber of Commerce and Industries (SCCI) President Majid Raza Bhutta. He said it would make ‘made in Pakistan’ products more acceptable in cost-competitive global markets, hence increasing the export revenues of the country. Currently, the export sector of Pakistan relies heavily on import of raw materials especially from China for further value-addition and re-exports. This practice adds to the cost of doing business and is a major contributor towards increasing import bill. Bhutta said that Pakistan has seen many industrial surges where new industries were established yet no work has ever been done to invest in support industry. Despite all the recommendations of Sialkot’s business community, to protect and further enhance the diversification of product lines within the five key export industries the city is famous for, the stakeholders feel a sense of negligence from current as well as previous governments in acceptance of such demands. According to Bhutta, more than 99% of the city’s business is export-oriented and regardless of overall decline exports trend, Sialkot has managed to grip its exports share, which is around $2 billion. “We claim that in Pakistan there is no other city manufacturing export-oriented value-added products through Small and Medium Enterprises, we just need friendly policies not incentives from the government to further boost the export revenues,” he added.