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Pakistan's economic turmoil under Shehbaz Sharif's second term as Prime Minister of Pakistan

Pakistan’s weak debt affordability drives ‘high debt sustainability risks’: Moody’s​


Global rating agency Moody’s on Friday said that the country’s weak debt affordability drives high debt sustainability risks as it noted that the government spends more than half its revenue on interest payments.

In a comment regarding the newly finance bill for the fiscal year (FY) 2025, it said, “The budget estimated debt servicing payments to have increased by about 18pc for fiscal 2025 compared with a year ago.”

“The government spends more than half its revenue on interest payments, indicating very weak debt affordability which drives high debt sustainability risks” it said, adding that “about 55pc of fiscal year 2025 revenue (Rs9.8 trillion) is earmarked for interest payments on the government’s debt”.

Regarding the increase in expenditure, the rating agency said it reflected “lack of significant cost-containment measures and Pakistan’s very high interest payments”.

It was quick to note that the subsidies increased by 27pc to Rs1.4 trillion, “mainly driven by large increases in subsidies to the power sector” which reflected litte progress in energy sector reforms.

Overall, the rating agency said that budget reflected “quicker fiscal consolidation, but ability to sustain reforms will be key to easing liquidity risks”.

Moreover, the agency echoed the same sentiments as experts as it highlighted that the finance bill “will likely support Pakistan’s ongoing negotiations with the IMF for a new Extended Fund Facility (EFF) programme that will be crucial for the government to unlock financing from IMF and other bilateral and multilateral partners to meet its external financing needs”.

However, it cautioned that the government’s ability to “sustain reform implementation” will be key to meeting the budget targets and unlocking external financing, which is necessary for easing of liquidity risks.

It highlighted that “a resurgence of social tensions on the back of high cost of living — which may increase because of higher taxes and future adjustments to energy tariffs — could weigh on reform implementation.

“Moreover, risks that the coalition government may not have a sufficiently strong electoral mandate to continually implement difficult reforms remain,” it commented.

In the budget, the government had announced a consolidated budget deficit of 5.9 per cent of the GDP for the fiscal year 2025 — from the previous year’s estimated 7.4pc — with the primary balance set at a surplus of 2pc of GDP for the upcoming year, the report recounted.

Additionally, the government has projected real GDP growth at 3.6pc and headline inflation at 12pc. It also sought to increase federal government revenue to an ambitious Rs17.8trillion — 46pc higher than previous year’s — through a “combination of new taxes and stronger nominal growth”.

According to the comment, this showed that “the government seeks to achieve quicker fiscal consolidation mainly through increases in revenue, with little spending-containment measures”.

The World Bank in its ‘Global economic prospects’ report said that Pakistan’s growth was expected to pick up at 2.3pc in FY25, where else “industrial activity and confidence are projected to improve mainly due to easing import restrictions and moderating inflation, although they remain constrained largely as a result of tight macroeconomic policies”.

The report said that the growth is assumed under “continued sound macroeconomic management, progress with structural reform implementation, and continued multilateral inflows and bilateral rollovers, which would boost investor confidence”.

Regarding inflation, the report noted that inflation had “moderated over the past year due to high base effects coupled with the stabilisation of the exchange rate, but it remains high”.

On a more positive note, it said that “foreign exchange reserves have increased in several countries, including Pakistan and Sri Lanka, reflecting the easing of currency pressures and receipts of official flows”.

www.dawn.com

Pakistan’s weak debt affordability drives ‘high debt sustainability risks’: Moody’s

"The government spends more than half its revenue on interest payments," the report says.
www.dawn.com
 
PM Shehbaz relieves finance minister from key economic forum

In a rare but apparent downgrade, Prime Minister Shehbaz Sharif will personally head the Executive Committee of the National Economic Council (Ecnec), instead of Finance Minister Muhammad Aurangzeb, as he notified the newly formed eight-member centre-provincial forum.

This marks the first time in decades that a finance minister will not chair Ecnec, a subordinate committee of the constitutional forum traditionally led by the finance minister. Prime Minister Sharif is also the chairman of the Cabinet Committee on Energy.

According to a notification issued by the Cabinet Division on Friday, the newly constituted Ecnec, led by the prime minister, would also comprise Deputy Prime Minister and Foreign Minister Ishaq Dar, Finance Minister Muhammad Aurangzeb and Planning Minister Ahsan Iqbal from the Centre.

This meant that in the absence of the prime minister, Mr Dar would preside over Ecnec meetings.

The prime minister had already appointed Dar as the head of the Cabinet Committee on Privatisation, while Finance Minister Aurangzeb is heading only two committees of the cabinet, including the Economic Coordination Committee and the Committee on State-Owned Enterprises.

As finance minister, Dar used to head almost all cabinet committees, the chairmanships of which are now being shared by the prime minister, the deputy prime minister, the finance minister and the planning minister.

Ecnec’s provincial members include Punjab’s senior minister Marriyum Aurangzeb, Sindh Irrigation Minister Jam Khan Shoro, adviser to KP Chief Minister Muzzammil Aslam and Balochistan’s Finance Minister Mir Shoaib Nosherwani.

In addition, the Planning Commission’s deputy chairman, secretaries of economic affairs, finance and planning, chairpersons of planning boards of Punjab and Sindh and additional chief secretaries of KP and Balochistan attend all the meetings on special invitation.

Moreover, the officers of federal and provincial governments, as well as those of Azad Kashmir and Gilgit-Baltistan, would be called to the meeting if needed.

Under its terms of reference, Ecnec will consider and approve Public Sector Development Programme schemes at both federal and provincial levels, in line with the sanctioning limits set by the National Economic Council (NEC) and notified by the Planning Division.

Ecnec also holds the authority to modify plans proposed by the Planning Commission and to review policy issues related to development projects before they are submitted to the NEC.

SOURCE: DAWN
 

Pakistan, Kazakhstan pledge to expand cooperation in trade and investment​

Prime Minister Muhammad Shehbaz Sharif engaged in a productive discussion with President Kassym-Jomart Tokayev of Kazakhstan on Monday, covering various bilateral and regional topics of mutual interest.

During the telephone conversation on the occasion of Eid-ul-Adha, both leaders exchanged warm greetings and extended prayers for the well-being of their respective nations.

Prime Minister Shehbaz Sharif highlighted the importance of enhanced connectivity between Pakistan and Kazakhstan to bolster economic and trade relations, emphasizing the need to prioritize this aspect.

The Kazakh president expressed his delight at the Prime Minister's re-election, foreseeing its positive impact on Pakistan's political and economic landscape.

Both leaders expressed satisfaction with the positive trajectory of bilateral relations and reaffirmed their commitment to expanding cooperation, particularly in trade and investment.

Looking ahead, Prime Minister Shehbaz Sharif mentioned his anticipation for the upcoming SCO Heads of State meeting in Astana, Kazakhstan, scheduled for July 3-4, 2024, underlining the significance of regional cooperation.

President Kassym-Jomart Tokayev welcomed the Prime Minister's participation in the summit, expressing happiness at the prospect of discussing a comprehensive agenda for advancing regional cooperation.

Furthermore, Prime Minister Shehbaz Sharif extended a cordial invitation to President Tokayev for an official visit to Pakistan, which was graciously accepted.

In a social media post, the Prime Minister expressed his satisfaction with the conversation, highlighting their discussions on strengthening bilateral relations, particularly in trade, investment, and regional cooperation. He also anticipated his visit to Astana for the SCO Heads of State meeting next month.

Source: SAMAA
 
Govt considers rollback of income tax hike amid criticism

In response to widespread public outcry and opposition from various sectors, the government of Pakistan is contemplating a partial rollback of its ambitious tax proposals, particularly concerning income tax hikes on salaried individuals.

The move comes amidst escalating discontent over the proposed fiscal measures aimed at generating additional revenue amounting to Rs 1.5 trillion in the upcoming fiscal year.

The Finance Ministry, led by Muhammad Aurangzeb, has initiated internal consultations following severe backlash from taxpayers and businesses alike. The proposed budget, totaling 18.9 trillion rupees, represents a staggering 30% increase over the current fiscal year, yet faces mounting resistance for its heavy reliance on increased taxes rather than expenditure cuts.

Prime Minister Shahbaz Sharif has been pressed by Finance Minister Aurangzeb to reconsider the substantial burden imposed on the salaried class, which has already contributed 360 billion rupees this year alone. Despite efforts to reduce this burden by 240 billion rupees, an additional 75 billion rupees in income taxes has been earmarked for the upcoming fiscal year.

Exporters, who have traditionally enjoyed a fixed income tax rate of 1%, are also slated to face gradual increases under the new proposals. Critics argue that such measures could jeopardize Pakistan's export competitiveness at a time when global economic uncertainties prevail.

Furthermore, contentious proposals such as an 18% sales tax on baby milk have sparked fierce debate. Stakeholders from the dairy industry warn that such a tax hike, if implemented abruptly, could lead to a significant spike in prices, burdening consumers already grappling with rising costs of living.

The Standing Committee on Finance, chaired by Senator Saleem Mandviwala, has emerged as a vocal opponent of these tax hikes. Mandviwala's committee has recommended a thorough review of the budgetary proposals, particularly the imposition of taxes affecting vulnerable groups like the salaried class and consumers of essential goods.

Chairman FBR, Malik Amjad Zubair Towana, has indicated openness to revisiting the proposed 18% sales tax on baby milk, suggesting a phased implementation instead. Industry leaders, including Nestlé Pakistan's Sheikh Waqar Ahmad, emphasize the potential hardships that an immediate tax hike on baby milk could impose on Pakistani families.

Meanwhile, the government's move to grant Pakistan International Airlines a 10-year deficit adjustment plan has drawn criticism from opposition figures like Senator Mohsin Aziz of Tehreek-e-Insaf. Aziz argues that such measures could amount to hidden incentives for potential buyers of state-owned enterprises, raising concerns over transparency and fiscal accountability.

In addition to tax policy revisions, the government has also proposed stringent measures such as banning non-filers from traveling abroad, a move aimed at expanding the taxpayer base and enhancing revenue collection.

With ongoing deliberations and consultations underway, the fate of these proposed tax revisions hinges on both Pakistan's financial capacity and its obligations under the International Monetary Fund's program, underscoring the delicate balance between fiscal consolidation and public sentiment.


Samaa TV
 
China has downgraded its diplomatic status with us

Excellent outcome of these frauds recent "successful" visit.
 

Pakistan's inflation rate to drop in next fiscal year: Fitch​

Fitch Ratings has said it expected inflation and interest costs to decline in Pakistan during the upcoming fiscal year 2024-25, in the light of recently presented federal budget FY25.

The rating company has predicted that the inflation will remain at 12% in the country as it struggles to avert an economic crisis.

The State Bank of Pakistan (SBP) last week cut its key interest rate by 150 basis points in a widely expected move, marking its first rate reduction in nearly four years in its effort to boost growth amid a sharp decline in retail inflation.

The decision to cut the key rate to 20.5% came a week after data showed inflation slowed to a 30-month low of 11.8% in May.

“Government debt looks set to decline to 68% of GDP by FYE24 due to high inflation and deflator effects, offsetting soaring domestic interest costs. We expect inflation and interest costs to decline in tandem, with economic growth and primary surpluses driving government debt/GDP gradually lower,” the rating agency added.

It also forecast the FY25 policy rate at 16%.

Fitch Ratings further stated that the “ambitious FY25 budget” strengthened Pakistan’s prospects to strike a bailout agreement with the International Monetary Fund (IMF).

It expressed doubts whether the government’s fiscal targets will be hit but predicted a drop in the fiscal deficit even if the said budget is only partially implemented.

“This should reduce external pressures, albeit at a cost to growth,” it said, adding that tight policy settings may depress growth more than the government expects.

The ratings agency said that the growth rate is expected to remain at 3% in the FY25, despite some improvements in short-term indicators of economic activity.

As per Fitch, Pakistan’s external position has continued to improve since February’s election.

It said that the The current account deficit is on track to narrow to 0.3% of GDP (just USD1 billion) in FY24, from 1.0% in FY23.

Moreover, the subdued domestic demand has compressed imports, while exchange rate reforms have attracted remittance inflows back to the official banking system.

The rating agency also expressed optimism about the economic situation with the help of strong agricultural exports.

While gsross reserves of the country, including gold now stood at USD15.1 billion, over two months of external payments, up from USD9.6 billion at FYE23, Fitch stated.

Source: GEO
 
Pakpak said:
China has downgraded its diplomatic status with us

Excellent outcome of these frauds recent "successful" visit.
Click to expand...
Tbf to China , Pakistan rulers visit China almost every month it seems to me.
 
Pakistan's inflation rate to drop in next fiscal year: Fitch

Fitch Ratings has said it expected inflation and interest costs to decline in Pakistan during the upcoming fiscal year 2024-25, in the light of recently presented federal budget FY25.

The rating company has predicted that the inflation will remain at 12% in the country as it struggles to avert an economic crisis.

The State Bank of Pakistan (SBP) last week cut its key interest rate by 150 basis points in a widely expected move, marking its first rate reduction in nearly four years in its effort to boost growth amid a sharp decline in retail inflation.

The decision to cut the key rate to 20.5% came a week after data showed inflation slowed to a 30-month low of 11.8% in May.

“Government debt looks set to decline to 68% of GDP by FYE24 due to high inflation and deflator effects, offsetting soaring domestic interest costs. We expect inflation and interest costs to decline in tandem, with economic growth and primary surpluses driving government debt/GDP gradually lower,” the rating agency added.

It also forecast the FY25 policy rate at 16%.

Fitch Ratings further stated that the “ambitious FY25 budget” strengthened Pakistan’s prospects to strike a bailout agreement with the International Monetary Fund (IMF).

It expressed doubts whether the government’s fiscal targets will be hit but predicted a drop in the fiscal deficit even if the said budget is only partially implemented.

“This should reduce external pressures, albeit at a cost to growth,” it said, adding that tight policy settings may depress growth more than the government expects.

The ratings agency said that the growth rate is expected to remain at 3% in the FY25, despite some improvements in short-term indicators of economic activity.

As per Fitch, Pakistan’s external position has continued to improve since February’s election.

It said that the The current account deficit is on track to narrow to 0.3% of GDP (just USD1 billion) in FY24, from 1.0% in FY23.

Moreover, the subdued domestic demand has compressed imports, while exchange rate reforms have attracted remittance inflows back to the official banking system.

The rating agency also expressed optimism about the economic situation with the help of strong agricultural exports.

While gsross reserves of the country, including gold now stood at USD15.1 billion, over two months of external payments, up from USD9.6 billion at FYE23, Fitch stated.


GEO TV
 
During Eid ul Adha, over 680,000 animals, worth more than Rs500 billion, were sacrificed across Pakistan. Yet, we claim it's a poor country facing economic fall, when in fact, the rich are getting richer and the poor are getting poorer.
 
Leader of the Opposition in the National Assembly (NA) Omar Ayub on Thursday assailed the budget presented for fiscal year (FY) 2025 as “economic terrorism” against the people as debate opened on the finance bill

Finance Minister Muhammad Aurangzeb presented his first federal budget with a total outlay of Rs18.9 trillion last week. The budget for the upcoming year aims for a modest 3.6 per cent GDP growth, and sets an ambitious Rs13tr tax collection target, raising taxes on salaried classes and removing tax exemptions for the rest.

Debate on the budget formally opened today in the NA after the Eidul Azha holidays with its passage planned for June 24. Ayub opened the debate with vociferous criticism of the budget.

His speech was muted several times as he lamented the alleged interference of the establishment.

“This budget is the story that began with vote ko izzat do (respect the vote) and ended with boot ko izzat do (respect the boot),” Ayub said while criticising the government.

“The budget is a fraud with the people. This is a highway robbery against the people of Pakistan. This budget in actuality is economic terrorism against the people and the future of the country,” he added.

Ayub alleged that the budget was made with the help of “economic hitmen who want to shake the foundation of this country”.

He further claimed that these same “economic hitmen” were also involved in the PTI’s ouster from power in April 2022.

Ayub said investors would not trust the economy to invest in a country where there was “no rule of law”, adding that the International Monetary Fund (IMF) had clearly instructed the government to talk to other stakeholders.

“The finance minister is a very professional man but his wings were clipped,” Ayub said, alleging that the government was trying to undermine Aurangzeb such as removing him from the chairmanship of the Executive Committee of the National Economic Council (Ecnec).

“Aurangzeb sahib’s heart must have sunk,” he said. “The Ecnec chairmanship was taken away by the prime minister and his wingman […] entered and his name is Senator Ishaq Dar. Family concern, family business, private limited,” Ayub added.

“Aurangzeb is smiling right now but he must be thinking that I will talk to Omar Ayub later because I have said the right things.”

“If you look at the people who Aurangzeb is associated with, if you look at their biography, each one of them is a known gangster,” he said.

The word gangster was expunged by NA Speaker Ayaz Sadiq.

The opposition leader also questioned whether the members of the PPP owned the budget.

“Would you vote for it with the government or not,” he said, adding that only a few people from the PPP participated in the budget presentation.

“And if they are not with them then the government would be slaughtered. They do not have it in them to run the government,” he said.

“The budget won’t be passed. An illegal, anti-people budget cannot work.”

He also said that the federal government had failed to impose taxes on the elite it promised in the previous budget.

“The biggest element of tax is income tax where they underperformed. They are unable to put weight on the elite,” he said.

Ayub added that everyone was saying the budget was “a constrained budget under the long shadow of IMF stipulations,” adding that the government did not put any room to manoeuvre for itself.

“They dug a grave for themselves, laid in it by themselves and are now asking to be saved,” he said, adding that only PTI founder Imran Khan could save the economy.

He said the nation stood behind the former premier and would go through hard times for him, however, the same could not be said for the current government.

The opposition also harshly came down on Planning Minister Ahsan Iqbal’s comments about the government intending to keep Imran in jail for its five-year term till 2029, warning that there would be a “reaction” to the remarks.

Source: Dawn News
 
Inflation genie still out of the bottle

The promises made in last year's financial budget to curb inflation have not been fulfilled as the prices of essential daily items such as vegetables, fruits, pulses, milk, curd, meat, rice, ghee, oil, tea, spices, and chicken have skyrocketed, making it increasingly difficult for the people to manage their household expenses.

Moreover, the rising unemployment rate has only exacerbated the situation. People face financial challenges every year after the budget is announced. The previous year's budget included promises to control inflation, but those promises were not fulfilled. The inflation started on July 1, 2023, and still shows no signs of abating.

According to market data and figures, potatoes were Rs30 to Rs40 per kg in June 2023, today they are being sold at Rs100 per kg; onions were Rs40 per kg last year and today they are Rs100 to Rs150 per kg; garlic was Rs350 last year and today its Rs600 per kg; ginger was sold at Rs330 per kg last year and today at Rs550; tomatoes’ price was Rs70 per kg last year and today they are being sold at Rs80.

Okra was sold at Rs120 last year while today it is Rs200 kg; lemon was last year Rs300 and today they are Rs700 kg; red gram was Rs400 per kg last year while today it is Rs540 per kg.

Milk was sold at Rs180 a litre last year and today it is being sold at Rs210 a litre, yoghurt last year was Rs190 per kg and now today it is being sold at Rs230 per kg.

Similarly, mutton last year was Rs16,00 kg and today it is Rs23,00 kg; beef was Rs900 per kg and today it is being sold between Rs1,250 to Rs1,300 per kg; chicken last year was Rs500 per kg and today it is being sold at Rs550 per kg; eggs last year were Rs250 a dozen and today they are Rs270 a dozen.

EXPRESS TRIBUNE
 
Pakistan’s current account deficit drops to $464mn: SBP

Pakistan’s current account deficit has seen a substantial reduction over the past 11 months, dropping by $3.3 billion to a mere $464 million, according to the State Bank of Pakistan (SBP), which is still massively lower than $3.76 billion in the same period of the previous year.

This improvement attributed to a notable decrease in the trade deficit, which fell by 87 percent during the same period.

In May 2024, the current account deficit stood at $27 million. The month’s trade figures revealed imports worth $5.93 billion against exports of $3.69 billion, resulting in a trade deficit of $2.3 billion. The combined deficit from trade, services, and revenue for 2024 reached $3.66 billion.

Worker remittances in May amounted to $3.24 million, contributing positively to the current account balance, while the current account balance for the 11 months remained slightly negative at $46.40 million.

From July 2023 to May 2024, Pakistan’s imports totaled $48.40 billion, while exports were significantly lower at $28.67 billion, leading to a trade deficit of $19.72 billion.

The overall loss from trade, services, and income for the 11 months was recorded at $29.37 billion. Worker remittances over this period were reported at $27.9 million.

Pakistan is currently engaged in talks with the International Monetary Fund (IMF) over a new longer and longer bailout with the lender as it looks to shore up its central bank’s foreign exchange reserves, which currently stand at $9.13 billion.

arynews.tv

Pakistan's current account deficit drops to $464mn: SBP

KARACHI: Pakistan's current account deficit has seen a substantial reduction over the past 11 months, dropping by $3.3 billion to a mere $464 million,
arynews.tv arynews.tv
 
Pakistan’s REER index down 3.62% MoM in May, now stands at 100.67

Pakistan’s Real Effective Exchange Rate (REER), a measure of the value of a currency against a weighted average of several foreign currencies, witnessed a decrease as it clocked in at 100.67 in May 2024, down from the revised 104.44 in April 2024, data released by the State Bank of Pakistan (SBP) on Friday showed.

A REER below 100 means the country’s exports are competitive, while imports are expensive. The situation reverses when REER stands above 100 on the index.

As per latest data by the SBP on Friday, the REER decreased 3.62% month-on-month (MoM) in May 2024.

When compared with May 2023, the REER value increased 15.27%, when it stood at 87.33.

The SBP says a REER index of 100 should not be misinterpreted as denoting the equilibrium value of the currency.

“Movement of the REER away from 100 simply reflects changes relative to its average value in 2010 and is unrelated to its equilibrium value,” the central bank said in an explanatory note on the topic.

Meanwhile, the Nominal Effective Exchange Rate Index (NEER) decreased by 0.23% MoM in May 2024 to a provisional value of 39.20 from 39.30 in April 2024.

On a yearly basis, the NEER index rose by 6% from the value of 36.97 in May 2023.


www.brecorder.com

Pakistan’s REER index down 3.62% MoM in May, now stands at 100.67

Pakistan’s Real Effective Exchange Rate (REER), a measure of the value of a currency against a weighted average of...
www.brecorder.com
 
Pakistan’s current account deficit drops to $464mn: SBP

Pakistan’s current account deficit has seen a substantial reduction over the past 11 months, dropping by $3.3 billion to a mere $464 million, according to the State Bank of Pakistan (SBP), which is still massively lower than $3.76 billion in the same period of the previous year.

This improvement attributed to a notable decrease in the trade deficit, which fell by 87 percent during the same period.

In May 2024, the current account deficit stood at $27 million. The month’s trade figures revealed imports worth $5.93 billion against exports of $3.69 billion, resulting in a trade deficit of $2.3 billion. The combined deficit from trade, services, and revenue for 2024 reached $3.66 billion.

Worker remittances in May amounted to $3.24 million, contributing positively to the current account balance, while the current account balance for the 11 months remained slightly negative at $46.40 million.

From July 2023 to May 2024, Pakistan’s imports totaled $48.40 billion, while exports were significantly lower at $28.67 billion, leading to a trade deficit of $19.72 billion.

The overall loss from trade, services, and income for the 11 months was recorded at $29.37 billion. Worker remittances over this period were reported at $27.9 million.

Pakistan is currently engaged in talks with the International Monetary Fund (IMF) over a new longer and longer bailout with the lender as it looks to shore up its central bank’s foreign exchange reserves, which currently stand at $9.13 billion.


ARY News
 

FM pledges consultation with masses, business community regarding economic decision​


A delegation from the Pakistan Business Council held discussions with FM Aurangzeb concerning the upcoming fiscal year's budget. During the meeting, the delegation presented specific tax proposals and commended the government's ongoing efforts.

Aurangzeb assured the delegation that their recommendations were being carefully considered and would be taken into account as much as possible in the finalization of the budget.

Additionally, the finance czar informed the delegation about the ongoing initiatives of the Federal Board of Revenue (FBR). He emphasized that these efforts aim to expand the tax base and include more retailers in the tax system.

Earlier, Aurangzeb had underscored the country's need to 'privatise' critical sectors of the country. He emphasised the urgent need to address the unsustainable losses incurred by state-owned enterprises, a burden disproportionately borne by the public.

He added that looking ahead, the administration plans to initiate the outsourcing of airports, a strategic move intended to stimulate economic growth by leveraging private sector efficiency.

The FM also highlighted that the country's current Tax-to-GDP ratio of 9.5% was not sustainable. While education, universities, and hospitals can be sustained through donations, the country can only function through taxes, he said.

tribune.com.pk

FM pledges consultation with masses, business community regarding economic decision | The Express Tribune

Highlights the need to expand tax base and include more retailers in the tax system
tribune.com.pk tribune.com.pk
 

FBR, finance ministry under fire for 18% GST on children's nutrition​

The Senate Standing Committee on Finance has raised serious concerns about the proposed tax measures in the budget for the next fiscal year, warning that they will fuel inflation in the country and increase malnutrition.

The committees recommendations to finance ministry and FBR will include withdrawal of 18% GST on child nutrition products, according to news reports in the media.

Committee chairman Senator Saleem Mandviwalla made these remarks during the committee meeting on Saturday. Criticising the imposition of taxes on basic food items, the committee rejected the proposed taxes on locally produced baby food and infant nutrition, as well as packaged milk.

The budget drew ire from lawmakers from both the ruling PML-N and PPP, as well as opposition Senators, with FBR being criticized for heavy taxation on essential items, as it will make life difficult for the common man.

The committee rejected the proposal to impose an 18 percent sales tax on baby milk, with members voicing concerns about how such a measure could be allowed in a country with a 40 percent stunting rate. PML-N Senator Anusha Rehman and PPP Senator Sherry Rehman both criticized the increase in sales tax on milk as cruel and noted that no consultation was held before making the decision.

In his budget speech, Finance Minister Muhammad Aurangzeb emphasized the vital importance of nutrition during the first 1,000 days of a child's life and the urgent need to address stunting. However, industry experts see the proposed 18% GST on locally produced infant formula, baby food, and child nutrition milk powders as counterproductive and misaligned with the government's stated goals.

In earlier meetings, industry representatives cognizant of the challenges being faced by the economy suggested three-year phase-wise general sales tax as a win-win solution for both the government and the industry, with the 5% on Y1, 10% Y2 and 18% on Y3.

Amid high inflation, it is crucial to recognize that locally produced infant formula, baby food, and fortified child nutrition milk powders are approximately 50% less expensive than imported versions, making them more affordable for the general population and less burdensome on foreign exchange reserves.

Source: SAMAA
 
No new duties to be imposed on solar panels

No new duties would be imposed on solar panels to ensure common people’s access to renewable solar energy, Prime Minister Shehbaz Sharif said on Tuesday.

“We will make low-cost renewable solar energy available to every citizen,” he said while presiding over a federal cabinet meeting in Islamabad.

“We are also actively planning to move the economy in a positive trajectory,” he said and added that the exports would be increased by developing small and medium-scale industries. “Further, privileges of elites of country’s resources will be abolished.”

The premier was of the view that the economic security of the common people and providing opportunities for equal development were among the priorities of the government.

In a move aimed at promoting the domestic solar panel industry, the federal government decided to offer tax concessions on the import of raw materials and components used in the manufacturing of solar panels, inverters, and batteries.

In his budget speech on June 12, Finance Minister Muhammad said that in order to reduce the country’s dependence on imported solar panels and conserve precious foreign exchange, the government has decided to provide tax incentives for the local production of solar panels, inverters, and batteries.

Last month, the energy minister clarified that the International Monetary Fund, which is in Pakistan for talks with the government on a new bailout package, has not set any condition to convert net metering to gross metering.



AAJ TV
 

Budget for next year aimed at reducing fiscal deficit: Aurangzeb​

Finance Minister Muhammad Aurangzeb said in the National Assembly (NA) on Tuesday that next year’s fiscal budget will aim to reduce fiscal deficit by focusing on measures that enhance the government’s revenues and reduce unnecessary expenditures.

Aurangzeb presented the budget on June 12 in the National Assembly, after which the lower house of parliament mulled over the financial plan for the upcoming fiscal year.

Today, PPP — which had initially boycotted the debate over the budget — decided that it would vote for the finance bill despite certain reservations.

While giving a press briefing after the party’s meeting, PPP leader Naveed Qamar said the meeting decided that if the party did not vote for the budget, “it would amount to dismantling the government and paving the way for instability in the country”.

The government now has numbers and this budget will go through, Qamar said.

Besides the PPP, members of MQM-P, another ruling coalition partner, also expressed concern over the government’s move to impose taxes on the salaried and middle-class people, stating that the budget would cause more inflation in the country.

A number of treasury members also questioned the credentials of FM Aurangzeb, calling him an “imported” person, and accusing him of having no clue about the ground realities and real issues being faced by the masses.

On Sunday, PTI leader Asad Qaiser met Jamiat Ulema-i-Islam — Fazl (JUI-F) chief Maulana Fazlur Rehman and the pair rejected the proposed federal budget for the upcoming fiscal year, calling it an “IMF budget” and “anti-people”.

Winding up today’s NA discussion on the budget, Aurangzeb quoted Prime Minister Shehbaz Sharif as saying that the process of simplicity and austerity would continue in the next fiscal year.

According to state-run Radio Pakistan, he said a committee, which he would head, was constituted to present recommendations, which include shutting down certain ministries or their merger and devolution to the provinces.

He announced that pension expenditures would be brought down through pension reforms in the future.

The finance minister pointed out that the homegrown reforms programme was the basis of the next year’s fiscal budget to steer the country out of a difficult economic situation.

The reforms include enhancing the tax-to-GDP ratio to 13 per cent, state-owned entities (SOE) reforms, public-private partnerships and energy sector reforms, Aurangzeb said, noting that the government was seriously committed to the plan and had begun its implementation.

He assured that all the stakeholders would be taken on board for the plan’s implementation.

Aurangzeb said that the digitisation process of Federal Board of Revenue (FBR) has been accelerated, adding that legislation was being introduced in parliament to bring changes in boards of the power sector.

The privatisation of PIA has been taken forward, he said.

Highlighting other points of the home-grown reforms plan, the FM said they included targeted social protection, a broad-based fair taxation system and initiatives for the health and education sectors.

Aurangzeb was appreciative of the recommendations submitted by the Senate for inclusion in next year’s budget, adding that the government had decided to include these recommendations in the budget keeping in view the public interest.

He said these include providing an opportunity to the non-filers for a personal hearing before implementing the measures of SIM blockage and a ban on foreign travel.

He announced that the stationery items would remain exempted from tax, and that current reduced rates for Hybrid-Electric Vehicles will remain intact.

He said under the Export Facilitation Scheme 2021 policy, zero rating for the local suppliers was not being abolished.

The finance minister said agriculture, education and health sectors were prioritised, while proposals such as exempting charity hospitals from sales tax would be given serious consideration.

He further noted that the government was fast-tracking reforms in the FBR, and Rs7 billion were earmarked in the budget for it.

Aurangzeb noted that action would be taken against retailers from July 1 for failing to register them with the FBR Tajir Dost Scheme.

With regards to the defence budget, the finance minister said that the country’s armed forces have rendered immense sacrifices for Pakistan’s defence and are standing firm to meet internal and external threats.

He said national security was Pakistan’s foremost priority, assuring that the armed forces will be provided with necessary resources.

The finance minister announced honoraria equivalent to three months of basic pay for various departments, including the staff of the National Assembly, Senate, PID, Radio Pakistan, PTV and APP, who performed duties in Parliament House during the budget session.

www.dawn.com

Budget for next year aimed at reducing fiscal deficit: Aurangzeb

Says government decided to include Senate recommendations in budget.
www.dawn.com
 
Just handover this country to IMF. These pathetic guys cannot even prepare their own budget, LOL

--------------------

PM Shehbaz confirms IMF role in budget prep

Prime Minister Shehbaz Sharif confirmed on Tuesday that the federal budget for next year was prepared in collaboration with the International Monetary Fund (IMF). His remarks came as Finance Minister Muhammad Aurangzeb announced significant amendments to the proposed finance bill for 2024-25.

“We had to prepare the budget jointly with the IMF” because of the prevailing circumstances and ground realities, the prime minister said in the National Assembly when he took the floor briefly to respond to some points raised by a PTI member regarding the prevailing sense of deprivation in south Punjab, taxes on fertilisers and burden on farmers.

PM Shehbaz expressed hope for a positive response from the lender, but refrained from making a premature statement. He said if the government received any response from the IMF, he would share it with parliament, expressing hope for some “good news”. However, it was unclear if the premier was referring to the IMF bailout or relaxations related to fertiliser.

The prime minister’s statement came shortly after Finance Minister Muhammad Aurangzeb departed from some critical reform measures announced in his budget speech on June 12, apparently after the government came under pressure from some influential industrialists and doled out more taxpayer money to appease public sector employees working in parliament.

The entire staff of the National Assembly and the Senate would get honoraria equivalent to three basic salaries, he said in his winding-up speech on the budget debate in the National Assembly.

Mr Aurangzeb said the government was progressing positively with the IMF, insisting that a bailout was necessary to achieve a sustainable solution to prevailing national economic and financial challenges.

Changes to original budget

Key changes to the original budget include the revival of zero rating (zero sales tax) on local sales of export industries and stationery items. To balance the revenue loss from these amendments to Finance Bill 2024-25, the government has reduced allocations for the Public Sector Development Programme (PSDP) by Rs250 billion.

This amount would now be shown against the Public-Private Partnership (PPP) at Rs350bn instead of Rs100bn earlier, but this notional funding has to come from the private sector, which would be an uphill task.

Besides the PSDP, Mr Aurangzeb announced three major changes to his original budget, including relaxations for hybrid vehicles, stationery items and the Export Facilitation Scheme 2021.

The finance minister also advocated for provincial contribution to expenses of national importance, reduction in provincial expenses and increased provincial resource mobilisation for national financial stability under what he called a “national financial pact”.

He said the budget was “based on homegrown reform plan through which the government wanted to take the country out of the current economic situation for which structural reforms are needed”.

He recalled key points of this plan, including increasing the tax-to-GDP ratio to 13 per cent, implementing state-owned enterprise (SOE) reforms, privatisation, and energy sector reforms, besides giving a central role to the private sector to transform a government-led economy into a market-driven economy.

In addition, he said the plan also envisaged an end to subsidies creating distortions in pricing and efficiencies and building a targeted social protection system through the establishment of a “broad-based and fair taxation system”.

He said the government was committed to these reforms and would provide quarterly progress reports to all the stakeholders.

On budgetary changes, he said that based on recommendations from various stakeholders, including the Senate Standing Committee on Finance, the government had decided to give an opportunity for personal hearing to non-filers of income tax before blocking their phone SIMs or foreign travels.

Likewise, under Section 116 of the Income Tax Ordinance, an explanation will be added to the declaration of foreign assets and assets of spouse in case of spouse being dependent on the taxpayer.

The finance minister also announced that default surcharge in terms of sales tax, income tax or federal excise duty would be charged at the rate of Kibor plus 3 or 12pc, whichever is higher.

On the other hand, Mr Aurangzeb said that stationery items would continue to be exempted from sales tax. In his June 12 budget speech, he announced a 10pc tax sales tax on stationery items.

He also announced changes to fines for late filers and non-filers of income tax, saying the tax rate would not be increased for those who had timely filed tax returns at least once in the last three years.

Likewise, he also announced the continuation of reduced sales tax rates at the existing level for hybrid electric vehicles in Schedule 8 and Serial no. 73 besides the continuation of zero rating on local supplies of the export sector under Export Facilitation Scheme 2021, which was subject to 18pc GST on local sales under the draft financial bill 2024-25. This will have a revenue impact of about Rs10bn.

He promised to accommodate tax exemptions demanded by PPP leader Bilawal Bhutto-Zardari for charity hospitals and to seriously review income tax rebates to professors and said that agriculture, education, health and renewable energy sectors had been protected as much as possible on the instructions of the prime minister.

Strict measures for retailers, distributors

He announced strict measures for retailers and distributors outside the tax net, saying the government was fast-tracking FBR reforms and the prime minister himself was monitoring the digitalisation of FBR under which the scope and operations of track-and-trace system (TTS) and point of sales (POS) would be expanded and tax policy and administration were being separated.

“Time has come to take strict action against retailers who do not participate in the FBR’s Tajir Dost Scheme,” Mr Aurangzeb asserted.

He said it had been decided to heavily increase tax rates on traders, shopkeepers, retailers and distributors who are non-filers under Section 236G and Section 236H. “This will be implemented from July 1, 2024, on all sectors,” he said.

He said the government was also taking expenditure control measures and austerity in the government departments would continue next year as well. In this regard, he also mentioned pension reforms for future expenditure management besides the creation of a committee to recommend the closure and merger of federal ministries or transfer to provinces functions of the devolved ministries.

Mr Aurangzeb announced that the financial requirements of the armed forces and civil armed forces would be met notwithstanding all the difficulties and provided foolproof security to Chinese workers as investment through the second phase of CPEC was at the top of the government priorities.

He also expected the reduced electricity rates and SBP’s policy rate would promote the industrial sector.

The finance minister delivered his winding-up speech with empty front rows as no other minister, except Planning and Development Minister Ahsan Iqbal, was present in the house at that time.

Mr Iqbal was also seen busy in his mobile phone most of the time. In the middle of his speech, Adviser to the Prime Minister Rana Sanaullah, who is not an elected member of the house, came to the assembly hall and sat on a chair in the front row.

DAWN
 

PM Shehbaz calls for enhanced trade partnership with Azerbaijan​


Prime Minister Shehbaz Sharif on Thursday instructed the formulation of a comprehensive strategy to strengthen cooperation and trade partnerships with Azerbaijan in the fields of economy and investment.

Chairing a high-level meeting on enhancing relations with Central Asian states, particularly Azerbaijan, the prime minister stated, “Pakistan geographically offers a natural economic corridor to the sea for Central Asian states.”

He highlighted the enduring fraternal relations between Pakistan and Azerbaijan, which have spanned decades.

He believed that there were significant opportunities for trade and investment between Azerbaijan and Pakistan.

“Foreign investment in the country is on the rise due to the government’s business and investment-friendly policies,” the prime minister mentioned.

The prime minister directed the development of a comprehensive action plan to boost trade efficiency and expand current trade between the two countries.

During the meeting, the prime minister was briefed on initiatives aimed at enhancing trade volume, capacity, and trade and investment between Pakistan and Azerbaijan.

It was highlighted during the briefing that there was substantial potential for energy cooperation with Azerbaijan, and discussions were ongoing for a preferential trade agreement between both countries.

Deputy Prime Minister and Foreign Minister Mohammad Ishaq Dar, along with Minister for Planning and Development & Special Initiatives Ahsan Iqbal, Federal Minister for Industries and Production Rana Tanveer Hussain, Federal Minister for Privatisation and Investment Abdul Aleem Khan, Federal Minister for Power Sardar Owais Khan Leghari, Federal Minister for Petroleum Dr Musadik Malik, Federal Minister for Commerce Jam Kamal Khan, Special Assistant to PM Tariq Fatemi, and other senior officials attended the meeting.

 
Foreign investment increasing due to govt’s policies: PM Shehbaz

Prime Minister Shehbaz Sharif directed to devise a comprehensive strategy to strengthen cooperation and trade partnership with Azerbaijan in the fields of economy and investment.

“Pakistan geographically offers a natural economic corridor to the sea for Central Asian states,” the prime minister said while chairing a high-level meeting on strengthening ties with Central Asian governments, especially Azerbaijan, in the sectors of commerce and investment.

He said that Pakistan offers a natural economic corridor through Sea waters for Central Asian states. He said that Pakistan and Azerbaijan have longstanding fraternal ties spanning decades.

PM Shehbaz said that foreign investment is increasing in the country due to the business and investment-friendly policies of the government.

PM Shehbaz directed the development of a comprehensive action plan to boost trade efficiency and expand current trade between the two countries.

During the meeting, the prime minister was briefed on initiatives aimed at enhancing trade volume, capacity, and trade and investment between Pakistan and Azerbaijan.

It was highlighted during the briefing that there was substantial potential for energy cooperation with Azerbaijan, and discussions were ongoing for a preferential trade agreement between both countries.

Deputy Prime Minister and Foreign Minister Mohammad Ishaq Dar, along with Minister for Planning and Development & Special Initiatives Ahsan Iqbal, Federal Minister for Industries and Production Rana Tanveer Hussain, Federal Minister for Privatization and Investment Abdul Aleem Khan, Federal Minister for Power Sardar Owais Khan Leghari, Federal Minister for Petroleum Dr. Musadik Malik, Federal Minister for Commerce Jam Kamal Khan, Special Assistant to PM Tariq Fatemi, and other senior officials attended the meeting.

Earlier on Wednesday, PM Shehbaz Sharif gave the green light to the joint ventures between Chinese and Pakistani companies for relocating the Chinese industries to Pakistan.

Chairing a meeting to discuss the matters of the Board of Investment (BoI), he said that promoting both local and foreign investment in Pakistan was among the government’s priorities.

He said the government was taking all possible steps to create a business-friendly environment for traders and investors. The prime minister directed the concerned to submit a comprehensive report on the follow up of Memorandum of Understanding (MoUs) signed between Pakistani and Chinese companies in Shenzhen during his recent visit to China.

arynews.tv

Foreign investment increasing due to govt's policies: PM Shehbaz

ISLAMABAD: Prime Minister Shehbaz Sharif directed to devise a comprehensive strategy to strengthen cooperation and trade partnership with Azerbaijan in
arynews.tv arynews.tv
 

National Assembly approves budget 2024-25 amidst opposition criticism​


The National Assembly on Friday approved the federal budget of Rs18,877 billion for the fiscal year 2024-25 following the completion of the approval process.

During the session, all opposition amendments were rejected unanimously.

Prime Minister Shehbaz Sharif, Pakistan Peoples Party (PPP) Chairman Bilawal Bhutto-Zardari, and Asifa Bhutto-Zardari participated in the proceedings, where the opposition criticised the budget, labelling it as IMF-driven and harmful to the public.

Regarding the Petroleum Development Levy reduction, the PPP retracted its amendments, while the opposition's amendments were dismissed by a vote count in the Assembly. Opposition amendments concerning the levy were voted down in the Assembly, with 170 members opposing and 84 supporting the reduction.

The prime minister responded to criticisms from PTI Chairman Barrister Gohar and former Speaker of the National Assembly Asad Qaiser regarding project allocations and fund distribution in Khyber Pakhtunkhwa.

Member of the Sunni Ittehad Council Junaid Akbar Khan criticized the premier, stating that if their government were to come to power, they would show him the reality of being in jail.

Additionally, amendments were passed to empower FBR officers for sales tax audits, allowing them to access necessary records without demanding data older than six years.

To strengthen tax enforcement, the FBR will establish a Tax Fraud Investigation Wing in Wang, focusing on preventing tax evasion and fraud, with dedicated legal and accounting units.

Minister of Finance Muhamamd Aurangzaib termed the budget 2024-25 as growth budget and said it was based on a well-thought-out strategy to boost the economic growth.

He said that the budget for the next fiscal year was aimed at narrowing the fiscal deficit by expanding the government’s revenues and cutting unnecessary expenditures.

Muhammad Aurangzaib reiterated the government’s commitment to increasing the tax-to-GDP ratio to 13 percent, which currently stands at a low 9.5 percent.

He said that the country had achieved macroeconomic stability. He highlighted that the economic indicators, including the current account, fiscal deficit, inflation, and foreign exchange reserves, were stable and under control.

He outlined the government’s plan to continue this economic stability into the next fiscal year, aiming to lead the country towards sustainable economic growth.

He also called for reconstructing and digitizing the Federal Board of Revenue (FBR) to ensure a high GDP target. He said that the concept of non-filers would be eliminated from the tax system, making it mandatory for everyone to pay taxes.

The minister expressed the government’s resolve to curb tax evasion and expand the tax net, particularly targeting retailers and the real estate sector.

He said that the current account deficit had decreased, the fiscal deficit was under control, and the country had foreign reserves of $9 billion, providing an import cover for two months.

He highlighted a significant reduction in inflation, from 38 percent to 11 percent, and sustained food inflation at two percent. He said that no tax had been imposed on solar energy.

The Finance Minister said that cardiology stents, surgical items, books, printing materials, and items in the FATA and PATA regions had been granted tax exemptions.

He said that tax exemptions could not be granted for packaged milk that did not meet quality standards. He said that these tax exemptions for the education and health sectors were provided despite the challenging economic conditions.

Opposition leader in the National Assembly, Omar Ayub, along with Pakistan Tehreek-e-Insaf (PTI) Chairman Gohar Ali Khan and Sunni Ittehad Council leader Ali Muhammad, said relevant stakeholders were not taken on board during the formulation of the bill.

Omar Ayub said: “The finance bill fails to address the critical economic challenges faced by the country and has been drafted without adequate consultation with key stakeholders.”

Gohar Ali Khan said: “This bill is not reflective of the people’s aspirations or the country’s economic realities.”

tribune.com.pk

National Assembly approves budget 2024-25 amidst opposition criticism | The Express Tribune

FM Aurangzaib vows to boost tax-to-GDP ratio to 13%, up from 9.5%
tribune.com.pk tribune.com.pk
 
This is the bravest budget in Pakistan's history. A lot of people are whining because they've finally come into the tax bracket. If Pakistan follows through on these new tax policies and goals, it will soon achieve economic stability.
 
The 15% additional income tax on banks may remain in place after Prime Minister Shehbaz Sharif intervened on Thursday, directing authorities not to provide any relief to the banks

The premier’s intervention came as the government finalised new tax avenues that might be announced today (Friday) during the approval of the Budget 2024-25. The National Assembly is expected to approve the new budget and reveal new tax proposals, which are over and above the Rs1.5 trillion in taxes imposed on June 12th.

At least two cabinet members confirmed to The Express Tribune that the premier intervened after widespread reaction against an attempt to provide tax relief to the banks. The banking industry has enjoyed exceptionally high profits due to a desperate borrower in the form of a cash-starved finance ministry.

Deputy Prime Minister Ishaq Dar also sensitised the prime minister about the income tax relief issue to the banks, while advising the premier to stop the 15% income tax relief to the banks For the next fiscal year, the government plans to borrow Rs24 trillion outside the budget from commercial banks to repay maturing loans. Another Rs9.8 trillion will be spent from the budget on interest payments to banks and foreign creditors.

However, banks argue that they are not forcing the federal government to borrow money from them, and that the 15% additional income tax on the amount they lend to the federal government is unjust.

The development came after The Express Tribune reported that, despite severe economic challenges, the government might abolish the 15% additional income tax on profits banks make by extending loans to the cash-strapped finance ministry. This move could have provided approximately Rs60 billion in benefits to a sector that earned Rs960 billion in profits last year.

The Express Tribune had reported that an understanding was reached between commercial banks and the federal government to abolish the Advances-to-Deposit rate-based income tax.

About 27 banks made Rs960 billion in net profit in 2023.

Finance Minister Muhammad Aurangzeb did not respond to a question about whether he also stopped the FBR on Thursday from including the proposal to withdraw the tax in the Finance Act, to be passed by the National Assembly today (Friday).

Sources said that one Islamic bank, three larger conventional banks, and one small conventional bank were the main beneficiaries of the move. One field office of the FBR had estimated receiving Rs17 billion in this fiscal year.

The federal government unveiled an Rs18.9 trillion bloated budget on June 12th and set the FBR’s tax collection target at Rs13 trillion, based on Rs1.5 trillion in additional measures. The government once again hit the salaried class with Rs75 billion in additional taxes, bringing their total contributions to about Rs435 billion in the next fiscal year due to higher rates.

Banks often avoid the levy by readjusting their lending to the government just before the December 31 tax payment deadline. The FBR proposed calculating the tax liability based on average annual lending to the government rather than on the last day of the year.

If the government retains the additional income tax on lending to the government, it needs to plug the loophole that banks exploit to avoid the tax. The government can fix this loophole through a Statutory Regulatory Order, as it did by suspending the ADR tax last year.

Under pressure from banks, the government suspended the additional tax for 2023, but it became effective again in January 2024.

Source: The Express Tribune
 
Govt introduces new tax measures to meet IMF criteria

The government has extended exemptions in specific sectors while announcing new tax measures in several areas to generate additional revenue in the coming fiscal year to meet the International Monetary Fund’s criteria.

Finance Minister Muhammad Aurangzeb announced the new measures in the National Assembly on Friday. These include introducing a capital value tax on property in Islamabad and implementing new tax measures on builders and developers.

The government amended the Finance Bill 2024, which was presented to the National Assembly on June 12. In the amended finance bill, the government reduced the Petroleum Development Levy (PDL) on diesel and petrol from Rs80 to Rs70 per litre but increased it from the existing Rs60.

FED on air tickets

The Federal Excise Duty (FED) rates have been raised from Rs5,000 to Rs12,500, representing a 150 per cent increase for economy and economy-plus foreign travel tickets. The tax rates for other classes were raised by 40pc. The new rates will take effect from July 1.

The FED rate differs for club, business, and first-class flight tickets issued to IATA Traffic Conference Areas 1–3. The FED rate will be Rs350,000 for air tickets to IATA Traffic Conference Areas-1 (North, Central, and South America), Rs150,000 for IATA Traffic Conference Areas 2 (Middle East and Africa), and Rs210,000 for Europe. Air tickets in IATA Traffic Conference Areas 3 (Far East, Australia, New Zealand, and Pacific Islands) will be Rs210,000 from July 1.

Exporters/salaried individuals

Despite opposition, exporters will pay the standard corporate tax rate of 29pc and a super tax where applicable. This is a significant change from the previous 1pc tax on export turnover. Individuals (salaried and non-salaried) and associations of persons earning over Rs10m per year will be subject to a 10pc surcharge on their income tax.

The government has extended the reduced tax rates for hybrid vehicles until June 30 2026, as outlined in the auto policy. The FED on cement has been increased to Rs4 per kg from Rs3. However, the sales tax benefits for erstwhile Fata/Pata have been extended for another year.

The scope of exemption on sales or transfer of immovable property is further widened to include a war-wounded person while in service of Pakistan Armed Forces or Federal or Provincial Government or an ex-serviceman and serving personnel of armed forces or ex-employees or serving personnel of federal and provincial government.

The penalty rate for non-compliant telecom operators was cut to Rs50 million and Rs100 million, respectively. A tax fraud investigative wing will be established within the FBR to detect, analyse, investigate, battle, and prevent tax evasion and fraud. The dividend withholding tax rate was reduced to 15pc from 20pc. The 25 rebate for teachers and researchers was restored.

The sales tax exemption is restored on newsprint and books excluding brochures, leaflets, and directories; exercise books; various cardiology/cardiac surgery, neurovascular, electrophysiology, endosurgery, endoscopy, oncology, urology, gynaecology, disposables and other equipment; supplies and imports of plant, machinery, equipment for installation in tribal areas and of industrial inputs by the industries located in the tribal areas; supplies of electricity to AJK, goods excluding electricity and natural gas supplied to hospitals run by charitable hospitals of beds or more.

The government has also placed the import of gold under the entrustment scheme under SRO 760(I)/2013 under the Sixth Schedule of Sales Tax (exemption from sales tax); import of cystagon, cysta drops and trientine capsules (for personal use only); and bovine semen.

Sales tax on milk

Milk supplied by corporate dairy farms is subject to an 18 sales tax, and lubricating oil is subject to an FED at the rate of 5pc ad valorem. The FED on the minimum price for selling cigarettes at retail (excluding sales tax) has been reduced to 55pc from 60pc.

The finance bill levied a capital value tax on farmhouses and residential homes in the federal capital region. Farmhouses within the geographical borders of the Islamabad Capital Territory would be subject to a CVT rate of Rs500,000 for areas ranging from 2,000 square yards to 4,000 square yards. The CVT will be Rs1 million where the space surpasses 4,000 square yards.

The CVT fee for residential houses inside the territorial borders of the ICT is Rs1,000,000 for areas ranging from 1,000 sq. yards to 2,000 sq. yards, and Rs1,500,000 for areas above 2,000 sq. yards.

The government has also introduced a new tax on the construction and sale of residential, commercial, or other buildings and on the development and sale of residential, commercial, or other plots.

DAWN
 
Exporters to get tax refunds within three days: Aurangzeb

Addressing a press conference here finance minister said that the PSDP has been slashed, the ministers are not getting salaries.

He thanked 42,000 new retailers for registering themselves and said that they will be taxed from July 1st (tomorrow).

He said that non-filers should not exist. “In this particular budget, we have taken it to the punitive level so as to make the non-filers to file their taxes.”

The finance minister said: “The IMF programme is our assurance in terms of macro stability it will be difficult to reform in absence of macro-economic stability”.

The minister said he was clear-headed and would ensure that the government works to lessen the burden on the common people and businesses in the coming days by curbing leakages and improving the management system.

He said the government measures have improved the economy. “I’m very optimistic that we’ll be able to take it through the finish line for an Extended Fund Programme which is going to be larger and longer in nature.”

arynews.tv

Exporters to get tax refunds within three days: Aurangzeb

ISLAMABAD: Finance Minister Muhammad Aurangzeb Sunday announced tax refunds to exporters within three days, ARY News reported. Addressing a press
arynews.tv arynews.tv
 

Government to end the concept of non-filers: FM Augranzeb​


Finance Minister Muhammad Aurangzeb has said that the government has decided to abolish the concept of 'non-filers'.

Addressing mediapersons in capital Islamabad, the finance minister said he understood that the salaried class was particularly experiencing financial strain from new taxes. He pledged to offer relief to salaried individuals once any financial respite becomes feasible.

He also argued against the category of "non-filers," expressing confidence that government initiatives will eventually make the cetegorisation obsolete.

Highlighting key economic improvements, he stated that the country's foreign exchange reserves stand at $9 billion, and inflation has reduced from 38% to 12%.

The repatriation of dividends to international companies, which is crucial for attracting foreign direct investment, is complete.

The FM revealed that the World Bank approved $1 billion for the Dasu project, and the International Finance Corporation (IFC) sanctioned $400 million for PTCL, to be received in the next fiscal year. The Federal Board of Revenue (FBR) achieved tax collections of Rs 9.3 trillion, reflecting 30% growth.

Emphasising macroeconomic stability, he noted the FBR's complete digitisation, which will enhance efficiency and curb corruption through technological advancements.

Following this, Aurangzeb assured that all tax refunds up to June 30, 2024, amounting to over Rs 50 billion, would be disbursed within the next two to three days, along with the Duty Drawback of Local Taxes and Levies (DLTL) refunds. The FM mentioned that 42,000 retailers are now registered and will be taxed from July 1, reiterating his stance on eliminating the 'non-filers' concept.

Addressing the inflation-struck masses, the finance minister said, "I completely understand the stress that people from different sectors feel about additional taxes; I completely empathise and sympathise, but we need to work for it."

He emphasised the government's commitment to reducing the burden on common people and businesses by curbing leakages and improving the management system.

Announcing a new pension system for civil employees effective immediately, with the military to follow next year, Aurangzeb expressed optimism about the upcoming agreement with the IMF, expected in July.

"The IMF program is our assurance in terms of macro stability. We are taking it forward; it is inevitable. I'm very optimistic that we'll be able to take it through the finish line for an Extended Fund Programme which is going to be larger and longer in nature," he told reporters.

The cash-strapped federal government adopted a Rs 18.9 trillion budget laced with tax-raising measures to secure a new IMF bailout after almost defaulting last year.

The finance minister concluded by stating that the recent resolution on Pakistan in the US Congress is unrelated to the IMF program, and discussions with IMF officials during his recent US visit were satisfactory.

This final IMF program will span three years and be valued between $6 to $8 billion.

tribune.com.pk

US resolution unrelated to IMF Programme: FM Augranzeb | The Express Tribune

Aurangzeb expresses optimism about upcoming agreement with IMF, expected in July
tribune.com.pk tribune.com.pk
 
Headline inflation for June clocked in at 12.6 per cent on the year, data from the Pakistan Bureau of Statistics (PBS) showed on Monday

The reading is higher than the 11.8pc year-on-year rise in May, but is well below the average reading of 23.4pc for the financial year which ended June 30.

Month on month, the headline consumer inflation, measured by a basket of goods and services called the Consumer Price Index (CPI), rose 0.5pc in June.

The June CPI reading is in line with the forecasts of both the State Bank of Pakistan and the finance ministry, which had spoken of an uptick due to spending linked to Eidul Azha holiday.

The index has eased from a historic high of 38pc in May 2023, a slowdown that has provided relief for an economy beset by high inflation and low growth.

The central bank last month cut the main interest rate by 150 basis points — the first cut in nearly four years — bringing it down from a historic high of 22pc.

Finance Minister Muhammad Aurangzeb has said he expects further cuts this year in the face of falling inflation.

Rate cuts are key for the government as it seeks to rein in its fiscal deficit to 5.9pc of GDP, of which interest on local debt is a big part. Fiscal tightening is a key part of bailout talks with the International Monetary Fund (IMF).

The government is pushing for a long term bailout in the region of $6-$8 billion, and says it wants an agreement this month after it passed a tax-heavy budget on Friday.

However, in its monetary policy statement last month, the State Bank also warned of an uptick in inflation beyond the seasonal rise — pointing to expected taxation measures in the annual budget.

Source: Dawn News
 
Pakistan’s exports increase to $30 bln in FY 2023-24

The exports from the country witnessed an increase of 10.54 percent during the fiscal year 2023-24 as compared to the corresponding period of last year 2022-23, the Pakistan Bureau of Statistics (PBS) reported.

The exports during July-June (2023-24) were recorded at $30.645 billion against the exports of $27.724 billion, according to latest PBS data.

On the other hand, imports into the country declined by 0.84 percent to $54.734 billion this year against the imports of $55.198 billion last year.

Based on the figures, the trade deficit during the current fiscal year under review was recorded at $24.089 billion against the deficit of $27.474 billion last year, showing a decline of 12.32 percent.

Meanwhile, on a year-on-year basis, the exports from the country increased by 7.34 percent in June 2024 compared to the exports of the same month of last year. The exports during the month were recorded at $2.529 billion as against the exports of $2.356 billion in June 2023.

On the other hand, the imports during June 2024 were recorded at $4.919 billion compared to the imports of $4.189 billion in June 2023, showing an increase of 17.43 percent, according to the data.

On a month-on-month basis, the exports from the country decreased by 10.92 percent when compared to the exports of $2.839 billion during May 2024.

The imports into the witnessed a nominal increase of 0.08 percent when compared to the imports of $4.915 billion in May 2024, PBS reported.

arynews.tv

Pakistan's exports increase to $30 bln in FY 2023-24

ISLAMABAD: The exports from the country witnessed an increase of 10.54 percent during the fiscal year 2023-24 as compared to the corresponding period of
arynews.tv arynews.tv
 
Pakistani Prime Minister Shehbaz Sharif proposed to Russian President Vladimir Putin on Wednesday to consider barter trade as a means to circumvent Western financial sanctions hindering economic cooperation

Speaking at a meeting on the sidelines of the Shanghai Cooperation Organization (SCO) summit in Kazakhstan's capital Astana, Sharif recalled that during the Soviet period, Russia and Pakistan engaged in barter trade.

"In the 50s, 60s, and 70s, we had a trade turnover based on barter. We imported a lot of machinery and products from the Soviet Union and exported textiles and leather to your country. All of this was done on barter terms. It seems to me that now is the time to overcome financial and banking problems and resume and expand our trade relations under the terms of barter," he said.

Sharif said this option would greatly benefit Pakistan and help overcome many other challenges.

Meanwhile, in a separate meeting with Azerbaijani President Ilham Aliyev, Putin emphasized the significance of the North-South Transport Corridor project, calling it a "top priority" on the bilateral agenda.

The Russian leader described cooperation with Azerbaijan as "extensive," saying: "I believe we would have plenty to discuss even if we met every month."

Aliyev noted "a few positive developments" regarding the North-South project since their last meeting and expressed determination to expand the transport corridor infrastructure on the Azerbaijani side. He acknowledged that it currently does not meet the maximum potential use plans of their partners and neighbors.

Putin also held bilateral talks with his Mongolian counterpart Ukhnaagiin Khurelsukh, highlighting advancements in energy cooperation between the two countries.

The Russian president highlighted Mongolia's challenges due to climate change and offered assistance in the form of grain supplies, other goods, and energy free of charge.

Khurelsukh emphasized Mongolia's priority on logistics projects such as the development of railroads. He also mentioned the country's ongoing efforts to address its energy shortage, including the recent construction of a hydroelectric power plant with China, and expressed interest in pursuing a similar project jointly with Russia.

Later, Putin highly praised cooperation between Moscow and Beijing in a meeting with Chinese President Xi Jinping, saying "Russian-Chinese relations of comprehensive partnership and strategic cooperation are going through the best period in their history."

"Our cooperation is not directed against anyone. We do not form any blocs or alliances. We are simply acting in the interests of our peoples," he stressed.

For his part, Xi highlighted the importance of completing bilateral projects on time and strengthening the friendship between the two countries.

"In a complex international situation and challenging external environment, we must remain steadfast in our commitment to eternal friendship, work diligently for the welfare of our peoples, enhance the unique value of Sino-Russian relations, cultivate new drivers of cooperation, and make tireless efforts to protect our legitimate rights and interests, as well as the fundamental norms of international relations," he said.

Source: Anadolu Agency
 
PM proposes steps to boost trilateral trade

Prime Minister Shehbaz Sharif on Wednesday proposed a tripartite institutional mechanism, particularly in the economic and investment fields to further strengthen Pakistan-Turkiye-Azerbaijan trilateral economic and commercial cooperation.

Sharing his views during an inaugural session of Pakistan-Turkiye-Azerbaijan Trilateral Summit held on the sidelines of the Shanghai Cooperation Organization (SCO) Summit, the prime minister underscored that Pakistan deeply valued its fraternal ties with Azerbaijan and Turkiye which were grounded in deep-rooted cultural, historic and religious bonds as well as mutual respect and support towards each other on core issues.

The summit was attended by Prime Minister Muhammad Shehbaz Sharif, President of Turkiye, Recep Tayyip Erdogan and President of the Republic of Azerbaijan Ilham Heydar Aliyev.

Prime Minister Muhammad Shehbaz Sharif welcomed the convening of inaugural session of Pakistan-Turkiye-Azerbaijan Trilateral Meeting at the summit level, PM Office Media Wing said in a press release.

He termed it a natural progression of trilateral engagements amongst the three brotherly Muslim countries which shared a similar outlook on a host of issues of mutual interest and common concern.

While noting excellent trilateral cooperation in political, parliamentary and defence domains since the First Trilateral Meeting of Foreign Ministers of the three countries held in Baku in 2017, he affirmed Pakistan’s commitment to working together with Turkiye and Azerbaijan to elevate the tripartite cooperation into a strong multifaceted partnership across all areas of mutual interest including economic, energy, tourism, cultural, educational, technology and innovation, healthcare and environmental cooperation.

Emphasizing strong bonds of friendship and robust people-to-people contacts amongst the three countries, the prime minister also outlined significant potential for collaboration in the areas of culture, tourism, academia as well as science and technology.

Pakistan, Turkiye and Azerbaijan have previously held trilateral consultations at the level of foreign ministers, speakers of parliaments and defence personnel.

The trilateral meeting discussed regional and global peace and prosperity and focused on fostering of regional cooperation for sustainable development.

A round of trilateral meeting had already been held among the three respective foreign ministers.

The prime minister said that Pakistan accorded high priority to its bilateral ties with Turkiye and Azerbaijan.

He said Pakistan was committed to enhancing the trilateral cooperation with Turkiye and Azerbaijan in areas of the economy, energy, tourism, climate change, culture, education and IT.

EXPRESS TRIBUNE
 
Pakistan’s total liquid foreign reserves increased to $ 14.57 billion

The total liquid foreign reserves of Pakistan increased to US$ 14,573 million while the foreign reserves held by the central bank were recorded as $ 9,389.5 million as of June 28, 2024.

“The SBP reserves increased by US$ 494 million to US$ 9,389.5 million due to official inflows from multilateral agencies,” a statement issued here on Thursday by the central bank informed and added that net foreign reserves held by commercial banks were recorded as $ 5,183.5 million, during the week ended on June 28, 2024.

Total liquid foreign reserves held by the country, in the previous week ended on June 21, 2024, were $ 14,207.3 million. Among them foreign reserves held by the central bank were $ 8,895.8 million while $ 5,311.5 million were held by commercial banks.


www.app.com.pk

Pakistan's total liquid foreign reserves increased to $ 14.57 billion

KARACHI, Jul 04 (APP):The total liquid foreign reserves of Pakistan increased to US$ 14,573 million while the foreign reserves held by the central bank were
www.app.com.pk
 
Pakistan, Belarus to bolster trade ties

Pakistan and Belarus on Thursday noting positive growth in all aspects of bilateral relations over the past decade reaffirmed their commitment to further strengthen mutually beneficial cooperation and economic and trade relations.

The bilateral relations were discussed in a meeting between Prime Minister Shehbaz Sharif and President of the Republic of Belarus Aleksandr Lukashenko, on the sidelines of the SCO Summit here.

A wide range of topics, including political relationship, trade and investment, military cooperation and regional issues, were discussed.

Prime Minister Shehbaz congratulated President Lukashenko on Belarus’ membership of the SCO underlining that this would further strengthen the organization.

He highlighted Pakistan’s policy of economic revival through export-led growth, strengthening of public finances, and attracting investment from friendly countries.

The two leaders also discussed global and regional developments and reviewed progress on various aspects of work under the Shanghai Cooperation Organization (SCO). The prime minister shared Pakistan’s efforts and desire for a peaceful and stable region.

EXPRESS TRIBUNE
 

Ishaq Dar promises consultation with coalition partners on privatisation plans​


Deputy Prime Minister and Foreign Minister Ishaq Dar assured the Senate that all coalition partners would be consulted on the privatisation process, emphasising transparency and accountability.

Dar addressed the Senate, stating that as the head of the Cabinet Committee on Privatisation (CCOP), he would ensure the process is transparent.

He highlighted the financial losses suffered by Pakistan Steel Mills, questioning the feasibility of enduring further losses.

Dar criticised previous governments for failing to resolve the Pakistan Telecommunication Company Limited (PTCL) privatisation issues dating back to General Musharraf's era.

He mentioned that only a fraction of PTCL's assets had been transferred to Etisalat, which had undervalued these assets.

Dar also reiterated Pakistan's support for Palestine, detailing the country's efforts in international forums such as the Organisation of Islamic Cooperation (OIC) and the Shanghai Cooperation Organisation (SCO).

He announced that Palestinian medical students would receive support to complete their education in Pakistan.

tribune.com.pk

Ishaq Dar promises consultation with coalition partners on privatisation plans | The Express Tribune

Deputy PM highlights losses suffered by Pakistan Steel Mills, questioning feasibility of enduring further losses
tribune.com.pk tribune.com.pk
 
Pakistan trade deficit reduced by 12.3pc, consumers hit by food exports surge

A sizeable jump in exports and minor decrease in imports meant that Pakistan saw trade deficit shrinking by 12.3 per cent in 2023-24, latest data released by the Pakistan Bureau of Statistics (PBS) shows.

These figures mean that the trade deficit was recorded at $24.09bn against $27.47bn in 2022-23, after the country’s exports increased by 10.54pc to $30.64bn and imports reduced by 0.84pc to $54.73bn.

Meanwhile, Pakistan exported goods worth $2.529bn in June 2024, translating into an increase of 7.3pc when compared to $2.356bn in the same period last year, marking the tenth consecutive monthly rise in exports.

However, Pakistan’s imports for the month under consideration reached $4.92bn with a jump of 17.43pc, totalling, which means there was trade deficit of $2.39bn in June after shooting up by 15.39pc.

When compared to the previous month of May, exports in June were down by 10.9pc, and imports remained the same.


dunyanews.tv

Pakistan trade deficit reduced by 12.3pc, consumers hit by food exports surge

Overall exports in 2023-24 jump 10.54pc, imports down 0.84pc
dunyanews.tv dunyanews.tv
 
https://twitter.com/x/status/1801933926081900919

Rs 75 billionRevenue of increase in income taxes on salaried and non salaried classes:Rs 1500 billionImpact of pay and pension increase for babus across Pakistan.The other Rs 1425 billion is borrowed in your name.This is why you should care about public sector pay and pensions, and the size of a govt system in which 9 of 10 people in most departments don't work but have a pay and pension for life.


https://twitter.com/Jhagra/status/1801933926081900919
 
PM Shehbaz to visit Karachi for one-day port operations review

Prime Minister Shehbaz Sharif will arrive in Karachi on Sunday for a one-day visit, particularly to review port operations in the metropolis.

According to a statement published on PML-N’s official account on the X platform, the PM will be briefed about the operations of the Karachi Port Trust, Port Qasim Authority, and the Pakistan National Shipping Corporation.

The premier is also expected to meet a delegation of businessmen from Karachi’s export and import sector.

The visit comes after PM Shehbaz invited Tajikistan to “avail the facilities of Pakistani seaports” for transit trade while on a two-day official visit to the Central Asian country this week.

“The prime minister informed the Tajik president about the operationalisation of Gwadar seaport and offered Tajikistan the opportunity to avail the facilities of Pakistani seaports,” a joint statement issued by the two countries said.

“It was highlighted that the Pakistani seaports offer the most efficient, shortest, and economic route for the Central Asian countries including Tajikistan to the markets in the Middle East and beyond”.

During his maiden visit to Karachi in April since assuming premiership earlier this year, the PM’s resolve was met with apprehensions from industry leaders who said it was “almost impossible” to do business under the current circumstances, particularly with high energy costs and inconsistent government policies.

Posing tough questions during an hour-long meeting at the CM House, Karachi’s business community appreciated the PM’s “determination”, but advised him to focus on bringing about political stability to “turn around” the economy.

He termed the meeting an attempt to listen to the “brilliant minds of business, absorb what they say, and put it into action” for a comprehensive economic growth roadmap.“

DAWN
 
Pakistan’s ports being developed for regional corridor: PM Shehbaz

Prime Minister (PM) Shehbaz Sharif on Sunday that the government was taking steps for the development of Pakistan’s seaports for the provision of shortest corridor to the regional countries, especially to the Central Asian States.

He said with a spur in sea trade by the Central Asian States, China and other countries of the region via Pakistani ports, the country could earn worth billions of dollars as foreign revenue every year.

The prime minister expressed these views during a visit to Hutchison Port, South Asian Pakistan Terminal where he was given a briefing, PM Office Media Wing said in a press release.

On the occasion, he directed the Chairman Federal Board of Revenue (FBR) to prioritize installation of latest scanners on Pakistani ports.

The prime minister said that the customs authorities in collaboration with the ports authorities should ensure immediate steps for complete utilization of the sea ports in Pakistan.

The prime minister was briefed that process for installation of latest scanners on ports by the FBR, was in the final stages which would enable rapid scanning of containers in the shortest time with the assistance of latest gadgets and artificial intelligence.

PM Shehbaz said for the progress of the country, it was imperative that its ports were also developed.

He said for increasing country’s exports, the government was taking measures on priority basis.

Federal ministers Muhammad Aurangzeb, Attaullah Tarar, Jam Kamal Khan, Qaiser Ahmed Shaikh, Ahad Khan Cheema, Governor Sindh Kamran Khan Tessori, Chief Minister Syed Murad Ali Shah, chairman FBR and other relevant officials accompanied the prime minister.

The prime minister was apprised that Hutchison Port, South Asian Pakistan Terminal was amongst the few global terminals located in deep seas which was being automatically operated upon.

The terminal had been equipped with latest technology and scanners and its operations were of the international standards.

PM Shehbaz was further informed that port had the capacity to handle the shipment of 35,00,000 containers annually.

The prime minister appreciated the latest operations of the port.

arynews.tv

Pakistan’s ports being developed for regional corridor: PM Shehbaz

KARACHI: Prime Minister (PM) Shehbaz Sharif on Sunday that the government was taking steps for the development of Pakistan's seaports for the provision of
arynews.tv arynews.tv
 

Hike in taxes ‘must to break IMF bailout cycle’​


Finance Minister Muhammad Aurangzeb has warned that the country would continue seeking financial assistance packages from the International Monetary Fund (IMF) if the government failed to significantly boost its tax revenues.

Speaking to a UK publication, the minister said he was “relatively confident” of reaching a staff-level agreement with the IMF this month for a loan the government had estimated to be between $6-$8 billion.

“But it will not be our last fund programme if we don’t bring our tax revenues up,” he added.

Aurangzeb’s comments came days after the president signed the federal budget for the current fiscal year—that has been criticised by the opposition, trade associations and even the government’s allies for its ambitious tax targets.

The government has set a tax revenue target of Rs13 trillion for the fiscal year that began on July 1, a nearly 40% jump from the prior year.

The budget for the ongoing fiscal has set a sharp drop in the country’s fiscal deficit to 5.9% of gross domestic product from 7.4% the previous year.

The government has set challenging revenue targets in its annual budget to help it win approval from the IMF for a loan to stave off another economic meltdown, even as domestic anger rises at the new taxation measures.

However, the Pakistan Stock Exchange (PSX) exhibited a bullish trend during the outgoing week as the KSE-100 index broke through the psychological barrier of 80,000 points, and the central bank’s foreign exchange reserves hit a two-year high at $9.4 billion.

“The direction of travel is positive, and investors are showing confidence in the stock market,” Aurangzeb said.

tribune.com.pk

Hike in taxes ‘must to break IMF bailout cycle’ | The Express Tribune

tribune.com.pk tribune.com.pk
 
PM says it would be a shame to go back to IMF again after 3 years

Lamenting that the burden of debt has mortgaged the future of nation's generations, Prime Minister Shehbaz Sharif has said it will be a matter of great shame if Pakistan has to once again return to the International Monetary Fund (IMF) for another loan after three years.

“To free ourselves from this cycle of debt, the federal and provincial governments, along with the relevant institutions, must work together,” the premier said while addressing a signing ceremony to launch a significant initiative aimed at the solarisation of agricultural tube wells in Balochistan on Monday.

“If we make this collective effort, future generations will be grateful. However, if we fail to make tough decisions, we will find ourselves seeking assistance from the IMF once again,” the PM, who was on a daylong visit to Quetta, said.

Pakistan is looking to strike a staff-level deal on an IMF bailout of more than $6 billion this month after addressing all of the Washington-based lender's requirements in its annual budget.

Moreover, the country’s debt has soared since the mid-2000s, as authorities failed to invest a gusher of loans from international bondholders and countries including China and Gulf nations into productive, export-oriented sectors.

Minister for Finance Muhammad Aurangzeb warned on Sunday that Pakistan would continue to seek the IMF bailouts "if it fails to boost tax revenue".

The finance czar said that he was "relatively confident" of reaching a staff-level agreement with the global lender this month for an estimated loan of $6 to $8 billion.

"But it will not be our last Fund programme if we don’t bring our tax revenues up," said the finance minister while speaking during an interview with the Financial Times.

The federal government presented the tax-loaded Rs18.877 trillion budget for the fiscal year 2024-25 (FY25) last month, aimed at shoring up public revenue and satisfying the IMF, which has repeatedly demanded improved tax collection.

The budget aims to raise Rs13 trillion by next July, a roughly 40% increase from the current financial year, to bring down a ruinous debt burden that has caused 57% of government revenue to be swallowed by interest payments.

Maintaining that turning to the IMF was a necessity, the PM Shehbaz said Pakistan had to finalise a deal with the IMF this month.

“Tomorrow in Islamabad, I will discuss measures to provide relief to the poor. The federal government stands with Balochistan in its development and prosperity. We will embrace anyone who genuinely cares for the well-being of Balochistan and Pakistan.”


www.geo.tv

PM says it would be a shame to go back to IMF again after 3 years

PM launches initiative for solarisation of tube wells in Balochistan.Vows to embrace those who care for the well-being of province.Says failing to take tough decisions will send us back to the IMF.QUETTA: Lamenting that the burden of...
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PM Shehbaz announces 3-month relief for protected consumers of electricity

Prime Minister Shehbaz Sharif on Tuesday announced a three-month relief period for lifeline consumers of electricity whose consumption remains below 200 units per month.

A post on the X account of state broadcaster PTV News said: “The government will give a discount of Rs50 billion to the electricity lifeline consumers in July, August and September. For three months, 25 million consumers of the country will benefit from the government’s relief.”

It added that the move would benefit “94 per cent of the country’s domestic consumers” of electricity.

Addressing a press conference in Islamabad, PM Shehbaz said the package would provide relief of up to Rs7 per unit to around 25m domestic consumers falling in the protected category for three months till September.

“Today, an amount of Rs50bn has been allocated to provide a relief of Rs 4-7 per unit as a concession to our protected category consumers using up to 200 units a month for a three-month period from July to September.

“This will benefit around 25m domestic power consumers which constitute around 94pc of the total consumer base,” the prime minister said.

He said that the federal government had scraped the said amount from its development budget to realise its commitment to public relief, contrary to the “hollow claims” of previous governments.

Shehbaz also assured the people of further relief as the government achieved fiscal space consequent to its ongoing measures of taxing the elite class, expanding the tax net, closing non-performing entities and plugging financial leakages.

He told the gathering of federal ministers and senior government officers that during its previous 16-month stint, the coalition government saved the country from default by putting its politics at stake.

PM Shehbaz said the government was going to sign a three-year programme with the International Monetary Fund (IMF) and had also taken it on board about the relief announced for the domestic power consumers.

He said the federal and Balochistan governments had reached an agreement a day ago to solarise around 28,000 tube wells in the province to save annual Rs80-90bn as the consumers were defaulting payment on power bills.

“The same model will be launched in other provinces as around a million tube wells are being run on imported oil having a financial implication of $3.5bn on foreign exchange,” he said and told the participants that a business model was being prepared in this regard.

PM Shehbaz said new taxes were imposed on the real estate sector in the annual budget to generate around Rs100bn and that the salaried class was justified to protest the tax burden.

“The time has come for the elite class to pay back to the country,” he remarked.

“These are the challenges and parasites which are eating up the country. If we have to make the country prosper, we will have to get rid of loans and begging. The only way is to make efforts and make the elite class pay back to the country,” he added and also called for exploiting the immense potential in agriculture, information technology, mining and mineral sectors.

Amid public outcry and potential political backlash, the government had decided to step back from about 51pc increase in electricity rates it had approved last week for so-called protected consumers by meeting a ‘prior action’ required by the International Monetary Fund (IMF).

On the instructions of the prime minister, a revised summary was planned to be urgently run through the federal cabinet that only last week cleared the massive tariff hike, including for ‘protected consumers’.

According to sources, PM Shehbaz had been alerted by some quarters, other than the power division, that consumers already had a lot of pent-up anger following accumulated bills in view of public holidays around Eidul Azha, coupled with higher consumption in hot and humid weather. They had already expressed their wrath through violence against officials of distribution companies in some areas.

Before flying to Quetta from Islamabad, the prime minister had issued instructions on Monday morning to modify the tariff increase summary already submitted to Nepra and exempt protected consumers from the hike. By the evening, the power division had circulated the summary as instructed. The resultant revenue gap of about Rs50bn would be covered by the government through subsidies and innovative tariff setting.

The tariff hike has to become effective from July 1, 2024 for all ex-Wapda distribution companies (Discos) and K-Electric as part of the IMF’s “prior action and structural benchmark”.

The tariff adjustment summary approved by the federal cabinet through circulation had envisaged raising the tariff by 51pc for “protected consumers” using up to 100 units per month and 41pc for protected consumers using up to 200 units per month. More than 15.5m consumers fall into this category, including 10.11m in less than 100 units and 5.5m in 101-200 units who remain below this threshold and could come on roads anytime.

But those unfortunate who cross 200 units even once in six months fall in the “unprotected category”.

DAWN
 

Finance minister calls for overhaul of military pensions​


Finance Minister Muhammad Aurangzeb on Thursday stated that the military's pension structure is unique, requiring a complete overhaul of its service structure, and announced one year for implementing new pension regulations.

He stated that their unique structure necessitates a comprehensive change in their service system, with a one-year timeframe to adopt new pension laws.

According to Express News, he said this at the National Assembly's Finance Committee meeting, chaired by Syed Naveed Qamar, on Thursday. The meeting included a briefing on ongoing negotiations with the International Monetary Fund (IMF).

The minister pointed out the heavy burden pensions place on the national treasury, with Rs1 trillion spent annually. He announced the introduction of new schemes in the budget to reduce pension costs, including a voluntary pension scheme for new employees.

The finance minister informed the committee that all macroeconomic indicators showed positive trends in the previous fiscal year, with inflation decreasing.

He noted that difficulties arose in 2023 when the IMF program was suspended, particularly regarding the repatriation of profits by investors. However, the situation has significantly improved.

Aurangzeb highlighted that the International Finance Corporation (IFC) provided a $400 million loan to PTCL. He assured that there are no longer import restrictions, and there is no pressure to artificially suppress any commodities.

He further emphasised the stabilisation of the forex market and the goal to increase the tax-to-GDP ratio to 13%, as the IMF indicates that no country can sustain a 9% tax-to-GDP ratio.

Aurangzeb expressed gratitude to provincial finance ministers for their support of agricultural income tax and stressed the importance of bringing everyone into the tax net, aligning with the IMF's demand for taxation on actual income.

He mentioned efforts to increase public trust in the Federal Board of Revenue (FBR) with Rs60 billion in additional refunds issued last fiscal year.

He highlighted that government expenditures are significantly impacted by debt and interest payments and suggested promoting public-private partnerships for development budgets.

The finance minister also reiterated introducing austerity measures to reduce government expenses, including the dissolution of five ministries and the decision to shut down the Public Works Department due to financial losses.

Aurangzeb concluded by noting the positive progress in negotiations with the IMF and expressed confidence that an agreement would be reached within the current month.

tribune.com.pk

Finance minister calls for overhaul of military pensions | The Express Tribune

Aurangzeb says their unique structure necessitates comprehensive change in service system
tribune.com.pk tribune.com.pk
 
The government borrowed Rs3.2 trillion from scheduled banks from May 15 to June 28 of the fiscal year 2023-24, despite a 30 per cent growth in revenue generation

The latest State Bank data shows that the government borrowed Rs71.8bn per day during the period, reflecting the government’s massive spending of the government.

In the budget for FY25, the government has resorted to heavy taxation in order to generate 40 per cent more revenue than what it did the previous fiscal year.

Although the government has been hinting at imposing more taxes to increase revenue, there seems to be little effort to curb spending in order to avoid borrowing.

Per day borrowing stood at Rs72bn for the period
Click to expand...
Government borrowing from scheduled banks reached a record high of Rs8.564tr during FY24, more than twice the Rs3.716tr it borrowed during FY23.

The borrowing for the last 45 days of FY24 — Rs3.2tr — was incidentally close to the entire borrowing in FY23. These borrowings come at a staggering cost since the interest rate is as high as 22pc.

Lavish spending​

The data shows that the government borrowed Rs6.55tr for domestic debt servicing during the year.

The government has been exhorting the nation to be ready for more sacrifices in the wake of ongoing talks with the International Monetary Fund (IMF), but has shown reluctance to stop its lavish spending.

The economy is under severe pressure since fixed investments have gone down to a 50-year low. The government slashes the development programme every year while the private sector’s borrowings from banks were negligible due to a whopping 22 per cent interest rate.

All these factors combined to restrict the growth rate to a miserable 2.38pc.

The government has set a 3.5pc growth target for FY25, but a ballooning debt servicing liability, a high interest rate despite low inflation and a slump in economic activities by the private sector is unlikely to allow economic managers to reach the target.

Govt raises Rs442bn at slightly reduced rates​

The government raised Rs442 billion against the target of Rs150bn through the auction of treasury bills on Wednesday.

The cut-off yields on the papers were reduced by 10 basis points for three months to 20.04 per cent and 18 basis points to 19.78pc for six-month T-bills. The rate on 12-month papers was kept unchanged at 18.54pc.

The government raised Rs74.6bn for three-month, Rs158.3bn for six-month and Rs121.4bn for 12-month papers. An amount of Rs87.4bn was raised through a non-bidding process.

Source: Dawn News
 
The Bald Eagle said:
The government borrowed Rs3.2 trillion from scheduled banks from May 15 to June 28 of the fiscal year 2023-24, despite a 30 per cent growth in revenue generation

The latest State Bank data shows that the government borrowed Rs71.8bn per day during the period, reflecting the government’s massive spending of the government.

In the budget for FY25, the government has resorted to heavy taxation in order to generate 40 per cent more revenue than what it did the previous fiscal year.

Although the government has been hinting at imposing more taxes to increase revenue, there seems to be little effort to curb spending in order to avoid borrowing.


Government borrowing from scheduled banks reached a record high of Rs8.564tr during FY24, more than twice the Rs3.716tr it borrowed during FY23.

The borrowing for the last 45 days of FY24 — Rs3.2tr — was incidentally close to the entire borrowing in FY23. These borrowings come at a staggering cost since the interest rate is as high as 22pc.

Lavish spending​

The data shows that the government borrowed Rs6.55tr for domestic debt servicing during the year.

The government has been exhorting the nation to be ready for more sacrifices in the wake of ongoing talks with the International Monetary Fund (IMF), but has shown reluctance to stop its lavish spending.

The economy is under severe pressure since fixed investments have gone down to a 50-year low. The government slashes the development programme every year while the private sector’s borrowings from banks were negligible due to a whopping 22 per cent interest rate.

All these factors combined to restrict the growth rate to a miserable 2.38pc.

The government has set a 3.5pc growth target for FY25, but a ballooning debt servicing liability, a high interest rate despite low inflation and a slump in economic activities by the private sector is unlikely to allow economic managers to reach the target.

Govt raises Rs442bn at slightly reduced rates​

The government raised Rs442 billion against the target of Rs150bn through the auction of treasury bills on Wednesday.

The cut-off yields on the papers were reduced by 10 basis points for three months to 20.04 per cent and 18 basis points to 19.78pc for six-month T-bills. The rate on 12-month papers was kept unchanged at 18.54pc.

The government raised Rs74.6bn for three-month, Rs158.3bn for six-month and Rs121.4bn for 12-month papers. An amount of Rs87.4bn was raised through a non-bidding process.

Source: Dawn News
Click to expand...
Keep borrowing towards total bankruptcy.
 
The chairman of Federal Bureau of Revenue (FBR) on Friday issued a warning to non-filers, stating that a 6 percent tax will now be levied for those who become late filers.

This announcement came during a meeting of the National Assembly’s Standing Committee on Finance, where Chairman FBR, Amjad Zubair, provided detailed insights into the current tax filing landscape.

According to Chairman FBR, a total of 5.2 million individuals submitted their tax returns in 2023, compared to 4.1 million in 2022.

He mentioned that the already imposed penalties on late filers have been increased to encourage timely submissions.

The FBR chairman elaborated on the tax implications for property buyers, noting that filers are required to pay a 3 percent tax, whereas non-filers must pay a significantly higher rate of 10 percent.

Chairman FBR revealed that the country currently has 240,000 non-filers, with data collected showing that 180,000 individuals have not submitted returns in the last three years.

Additionally, the data indicates that 600,000 non-filers have made substantial purchases, such as expensive vehicles and property.

Regarding measures to enforce compliance, Chairman FBR mentioned that more than 250,000 SIM cards of non-filers have been blocked.

Consequently, 86,000 individuals have since submitted their returns following the blocking of their SIM cards.

Source: Ary News
 
SBP reserves rise to $9.4bn

The foreign exchange reserves of the State Bank of Pakistan (SBP) increased by $16 million to $9.405 billion during the week ended on July 5.

The reserves exceeded the target of $9bn until the end of FY24. The IMF has been forcing the central bank to improve its forex holdings. The SBP restricted imports, managed the exchange rate, and curtailed dollar outflows from the country.

The country’s total foreign exchange reserves reached $14.644bn during the week under review. This figure includes a significant portion of $5.239bn from commercial banks.


Dawn
 

PM directs FBR to bring 4.9 million wealthy individuals into tax net​


Prime Minister Shehbaz Sharif has instructed Federal Board of Revenue (FBR) officials to bring 4.9 million wealthy and affluent individuals into the tax net without placing additional burdens on the poor.

According to a statement from the Prime Minister's Office on Thursday, PM Sharif chaired a four-hour-long review meeting focused on FBR reforms and digitisation. The session included briefings on the progress of Inland Revenue and Customs reforms over the past eight weeks.

"The digitisation process of the FBR is being overseen by internationally renowned consultants McKinsey, and the initial results are promising," an FBR spokesperson noted.

Prime Minister Sharif highlighted a significant achievement: "In the last four months, an Rs800 billion tax refund fraud was detected. We will further improve the tax refund system," he said. He also expressed concern over the delays in several FBR reform projects, deeming them "extremely regrettable."

The FBR briefing revealed that 83,579 tax-related cases, amounting to Rs3.2 trillion, are pending in various courts and tribunals. "Since the current government's tenure, various measures have been taken to resolve tax cases, with 63 cases worth Rs44 billion settled in the last four months," the spokesperson added.

Advanced technology has identified 4.9 million individuals with the capacity to pay taxes. The prime minister directed FBR officials to prioritise taxing the wealthy and affluent among them while sparing the poor.

The meeting also discussed the FBR's trader-friendly mobile application, which has registered 150,000 retailers since April 1, 2024. PM Sharif urged continued consultations with retailers to make this system more effective.

The premier instructed to increase the number of appellate tribunals to expedite tax case resolutions, aiming for 100 tribunals. He also ordered the establishment of a performance dashboard for these tribunals.

PM Sharif emphasised that there should be no delays in the payment of sales tax refunds and called for an immediate strategy to recover illegal refunds granted in the past. "The Fraud Detection and Investigation Department of the FBR must be fully digitised," he asserted.

He further directed the integration of all ongoing FBR reform projects into a centralised system and advocated for the use of state-of-the-art technology and skilled personnel in the digitisation efforts.

"There will be no delay in providing funds for upgrading the customs system," PM Sharif affirmed. He instructed the FBR to present strategies for new system software design and implementation, and for reforms in the Pakistan Revenue Automation Authority (PRAL).

The FBR officials announced the implementation of the Integrated Transit Trade Management System (ITTMS) at the Pakistan-Afghanistan borders of Torkham and Chaman starting October 2024. "International standard one-window facilities will be established," they said.

The development of the Automated Entry-Exit System (AEES), based on advanced scanning technology and linked to the Web-Based One Customs and Pakistan Single Window, has also begun. Initially, AEES will be implemented at Karachi's four ports and the airports in Karachi, Multan, and Peshawar. PM Sharif has also instructed its implementation at Gwadar port.

Lastly, FBR officials introduced the Single Sales Tax Return system, already implemented in the telecom sector, which will connect FBR with revenue authorities nationwide. PM Sharif mandated the application of this system to all taxpayers by October 2024.

tribune.com.pk

PM directs FBR to bring 4.9 million wealthy individuals into tax net | The Express Tribune

Shehbaz Sharif chairs a four-hour-long review meeting focused on FBR reforms and digitisation
tribune.com.pk tribune.com.pk
 
PM wants more tax tribunals to unlock Rs3.2tr

Prime Minister Shehbaz Sharif directed authorities on Thursday to increase the number of Appellate Tribunals from 50 to 100, to expedite the resolution of pending tax cases while asking the Federal Board of Revenue (FBR) to bring affluent individuals under the tax net.

The premier held a follow-up meeting with top FBR officials to review the performance of several tax projects that have been delayed for over three years. This was one of several meetings held by the prime minister to direct the FBR to speed up the digitalisation of the tax system.

He also directed an increase in the number of Appellate Tribunals for Customs cases and the creation of a dashboard to assess the performance of these tribunals.

During the meeting, a minister proposed appointing an FBR deputy chairman to oversee the reforms’ implementation. However, a ministerial committee will examine the idea before it is sent to the prime minister for approval, a source privy to the meeting told Dawn.

The FBR officers informed the prime minister that 83,579 tax-related cases totalling Rs3.2 trillion were pending in various courts and tribunals. According to officials, the government has taken some initiatives to resolve outstanding tax matters. Various courts disposed of 63 lawsuits totalling Rs44bn during the last four months.

Mr Shehbaz directed the FBR to hire top lawyers in high-paying cases.

He was also briefed on the work of McKinsey, a globally known consultant who has overseen the FBR’s digitisation process for the previous eight weeks. The premier directed that the procedure be completed as soon as possible.

Tax officials informed the premier that sophisticated technology has identified 4.9m people who are able to pay taxes. Mr Shehbaz has asked to prioritise bringing wealthy individuals into the tax net while ensuring that the underprivileged bear no additional burden.

During the briefing, it was stated that since April 1, 150,000 retailers had registered through the FBR’s trader-friendly mobile app. Mr Shehbaz directed the implementation of a unified sales tax system for all taxpayers by October.

The premier was briefed that the telecom sector successfully implemented a unified sales tax return system for taxpayers’ convenience.

The prime minister regretted the unnecessary delay in implementing several projects related to the FBR reforms.

DAWN
 
Govt looking for external financing avenues: FM Aurangzeb

Pakistan will focus on meeting its external financing needs by speaking with foreign governments and lenders to draw foreign investment as well as seeking loan rollovers, Finance Minister Mohammad Aurangzeb said on Friday, as the government prepares to execute its new $7bn International Monetary Fund (IMF) agreement.

Pakistan and the IMF reached an agreement for the 37-month loan programme earlier this month.

Tough measures such as raising tax on agricultural incomes and lifting electricity prices have prompted concerns about poor and middle-class Pakistanis grappling with rising inflation and the prospect of higher taxes.

Pakistan has relied heavily on IMF programmes for years, at times nearing the brink of sovereign default and having to turn to countries such as the United Arab Emirates (UAE) and Saudi Arabia to provide it with financing to meet external financing targets set by the IMF.

The finance minister in an interview said that external financing continued to be an important component, though the government was seeking to focus on more sustainable forms such as direct investment and climate financing.

“I think in the existing situation we can expect those (loan) rollovers to continue to take place […] we have requested extension of maturities,” Mr Aurangzeb said.

Rollovers or disbursements on loans from Pakistan’s long-time allies Saudi Arabia, the UAE and China, in addition to financing from the IMF, have helped Pakistan meet its external financing needs in the past.

The IMF said the new Extended Fund Facility programme is subject to approval from its executive board and obtaining “timely confirmation of necessary financing assurances from Pakistan’s development and bilateral partners”.

Mr Aurangzeb said meeting the external financing gap was “very manageable and very doable”. He said Pakistan plans to expand its strategy beyond relying heavily on rollovers and towards foreign direct investment, including in the huge copper and gold Reko Diq mine in southern Pakistan.

The government was working on identifying “bankable and investable” projects for Saudi Arabia and the UAE, which announced interest in billions of dollars in investment in the country, he added.

“That is what’s going to lead to sustainability,” he said. “If we can’t get this executed in the next three years, we will not be able to get out of the ‘last’ programme.”

Pakistan has been plagued by boom-and-bust cycles for decades, leading to more than 20 IMF bailouts since 1958. It is currently the IMF’s fifth-largest debtor, owing $6.28 billion as of July 11 according to IMF data.

Mr Aurangzeb said the Reko Diq copper and gold mine project had drawn interest from the World Bank’s private investment arm, the International Finance Corporation (IFC), which had signalled it would invest a “large amount”.

He said that during an upcoming trip to China, Islamabad would discuss power sector structural reforms with Beijing that the IMF suggested. Beijing has set up over $20bn worth of planned energy projects in Pakistan.

Climate finance

Pakistan — one of the countries worst affected by climate change — has also agreed with the IMF to launch talks this year on financing under the Fund’s Resilience and Sustainability Trust (RST) to draw financing for projects related to climate change.

Huge floods in 2022 caused billions of dollars of damage to infrastructure and agriculture, besides claiming hundreds of lives.

“We will start the discussions around that during this calendar year, possibly at the time of the first review, which will be in October, around the annual meetings in Washington,” Mr Aurangzeb said, though he did not specify how much the government would request.

Having successfully completed the long-term EFF in 2017, the PML-N government believed the plan was underway to ensure Pakistan completed the current programme as well, despite mounting political pressure and the inflationary impact of IMF-suggested reforms.

The minister, the former head of Pakistan’s largest bank, also stressed the government planned to push through the privatisation of loss-making enterprises including national carrier Pakistan International Airlines.

DAWN
 
LOL at 60 billion dollars. Electricity rates are closing in at 100 PKR per unit. Which export is he talking about???

----------------------------

PM Shehbaz unveils plan to double exports to $60 billion

Prime Minister Shehbaz Sharif has set an ambitious goal to boost Pakistan's annual exports to $60 billion within three years, directing the Ministry of Commerce and relevant agencies to implement practical measures to achieve this target.

Chairing the National Export Development Board meeting in Islamabad, the premier stated, "Alhamdulillah, our exports exceeded $30 billion last fiscal year, and IT exports surpassed $3.2 billion, which is a positive sign thanks to government policies."

During the meeting, Shehbaz instructed that the issues highlighted by exporters should be resolved within the next two weeks, with a report to be submitted, emphasizing, "I will personally chair the National Export Development Board meetings every month and a half. We must all work hard for Pakistan's progress. Despite challenging circumstances, I salute the business personalities and investors who have played their part in increasing Pakistan's exports."

Further directives from the Prime Minister included instructions to the Ministry of Commerce to finalize policy proposals in collaboration with representatives from export-capable sectors. He also tasked the Ministry of National Food Security to work with provinces to improve extension services, ensuring high-quality seeds and further processing of agricultural products for export.

Shehbaz further emphasized the importance of introducing high-yielding varieties of agricultural products and resolving shipping issues to reduce delivery times to Europe and the US. He also urged the Ministry of Commerce and the Board of Investment to ensure cooperation for the relocation of Chinese export industries to Pakistan.

Addressing the increase in exports, the premier said, "To boost exports and create a unique identity for Pakistani products, focus on research and development, innovation, and brand development. Any delay in exporters' refunds by the FBR will not be tolerated. Trade officers in Pakistani embassies worldwide should facilitate exports and guide Pakistani exporters."

The PM called for a comprehensive plan from the Ministry of Power to reduce electricity costs for industries. He highlighted that the private sector plays a crucial role in a country's development and should be included in policy formation to address their issues.

Export industry representatives praised Shehbaz for consistently meeting to address their issues, acknowledging his special interest in the export sector as encouraging and appreciated his initiative to ensure timely refunds from the FBR.

The meeting was attended by Deputy Prime Minister and Finance Minister Ishaq Dar, Federal Ministers Jam Kamal Khan, Ahsan Iqbal, Rana Tanveer Hussain, Muhammad Aurangzeb, Sardar Owais Khan Leghari, Dr. Musadik Malik, Ministers of State Ali Pervaiz Malik, Shaza Fatima Khawaja, Deputy Chairman Planning Commission Jahanzeb Khan, Governor State Bank, Prime Minister's Coordinator Rana Ehsan Afzal, Chairman FBR, relevant officials, and a large number of exporters from various sectors, including textiles, IT, leather, and agriculture.

EXPRESS TRIBUNE
 
FBR to bring property valuations closer to market rates

At a time when the government has implemented several tax measures in the budget for the real estate sector, the Federal Board of Revenue (FBR) on Tuesday directed its field formations to increase property valuation rates to bring them closer to market values, starting next month.

FBR Chairman Amjed Zubair Tiwana told Dawn that the new rates will be finalised in the coming days across more than 50 cities.

“I have directed the regional tax offices to revise the valuation rates,” he said, noting that the process had been delayed due to tax officials’ involvement in finalising indicative incomes and tax rates for retailers under the Tajir Dost Scheme.

The FBR did not raise property valuation rates last year due to a change of government. Property values, currently around 75 per cent of market value, are expected to increase to 90pc of estimated market rates.

The tax authority has previously adjusted property valuations four times, in 2018, 2019, 2021 and 2022.

Since 2016, the FBR has been carrying out the task of determining a property’s fair market price in major urban centres. In the provinces, valuation tables are typically notified by the district collector under Section 27-A of the Stamp Act of 1899.

The revised property tables will be used to calculate federal taxes, including capital gains tax (CGT) and withholding tax. Internationally, tax is charged on the transaction value, but in Pakistan, the collector value is often much lower than the actual transaction value.

Mr Tiwana confirmed that the FBR had completed the preliminary work to revise property valuations. He said tax officials would complete the revisions for over 50 cities shortly, aiming for implementation by Sept 1. The new rates will then be officially notified.

He said tax officers had been busy finalising tax rates with trader representatives. The final rates for indicative incomes and fixed rates are now being notified.


www.dawn.com

FBR to bring property valuations closer to market rates

New rates to be finalised in over 50 cities; property values expected to rise from 75pc to 90pc of estimated market rates.
www.dawn.com
 

PM Shehbaz Sharif commits to ECO reforms and intra-regional trade​


Prime Minister Muhammad Shehbaz Sharif reaffirmed Pakistan’s commitment to supporting the Economic Cooperation Organization (ECO) in enhancing intra-regional trade and advancing the ECO reforms agenda.

He conveyed this during a meeting with ECO Secretary General Ambassador Khusrav Noziri at the PM House on Thursday.

The Prime Minister underscored the significance of the “ECO Vision 2025” document, signed during the 2017 ECO Summit in Islamabad under then Prime Minister Muhammad Nawaz Sharif, as a vital framework for ECO's future direction.

Ambassador Noziri briefed the Prime Minister on ECO’s initiatives, activities, and his reform agenda aimed at revitalizing the organization.

Prime Minister Sharif appreciated Noziri’s contributions to promoting ECO as a regional cooperation platform and extended best wishes for his future endeavors.

The Prime Minister also highlighted that Ambassador Noziri is a graduate of Pakistan’s Foreign Service Academy and conveyed warm wishes for Tajikistan’s President Emomali Rahmon.

He expressed pride in the appointment of Dr. Asad Majeed Khan, former Foreign Secretary of Pakistan, as the incoming Secretary General of ECO.

Ambassador Noziri expressed gratitude for Pakistan’s consistent support during his tenure as Secretary General of ECO.

tribune.com.pk

PM Shehbaz Sharif commits to ECO reforms and intra-regional trade | The Express Tribune

PM Sharif highlights the significance of “ECO Vision 2025” for regional cooperation.
tribune.com.pk tribune.com.pk
 

Business owners slam govt for ‘economic mismanagement’ amid rising inflation, taxes​


Business owners in Pakistan have expressed growing pessimism about their future due to ongoing political turmoil and a new tax-heavy budget, calling Prime Minister Shehbaz Sharif's government a "worse" manager of the economy, according to a recent survey.

The Gallup Pakistan survey, which gathered responses from 454 small, medium, and large businesses across more than 30 districts in the second quarter of 2024, revealed negative values across all three strands of its Business Confidence Index.

The index showed declines of 4-10% in scores for the current business situation, future business situation, and the direction of the country.

A significant number of businesses criticised the government’s financial plan for FY25, deeming it unfriendly to business, while about two in five businesses identified inflation as their biggest problem.

As in the first quarter, price hikes were the most cited issue, with 37% of business owners urging the government to address it. Inflation soared to 12.6% in June, further eroding consumers' purchasing power.

More than half of Pakistan’s businesses, 54%, believe the current Pakistan Muslim League-Nawaz (PML-N) government is worse at managing the economy than the previous administration, according to the survey.

"Continued political uncertainty and the recently announced heavy-on-taxation federal and provincial budgets have had a significant impact on business optimism in the country," said Bilal Ijaz Gilani, executive director at Gallup Pakistan and chief architect of the Business Confidence Index.

The business community, already burdened by various regulatory measures and taxes, expressed serious concerns about the new budget during the survey, Gilani added.

The number of businesses seeking government intervention on taxation issues has increased considerably since the first quarter due to the heightened taxes in the latest federal budget.

Six out of 10 businesses reported crippling load-shedding, with 16% more businesses noting increased power outages due to heavy loads on the power infrastructure in summer. Overall, 61% of businesses reported experiencing load-shedding.

National and global challenges have made economic security a distant dream for Pakistan's business owners, leading to a 16% drop in the net current business situation score in the second quarter of 2024.

Business owners appeared more pessimistic about the future, with 57% expressing negative expectations and only 43% expecting improvements. The net future business confidence score has declined by 36% since the last quarter, now standing at -14%.

Pessimistic expectations were particularly prevalent among those selling hardware, tools, electrical items, and manufacturing products. Businesses selling home decor, gift items like toys and sports goods, and cosmetics were among the most optimistic.

The net direction of the country score also worsened to -64%, dropping by four percentage points from the previous quarter.

"Only 18% of respondents claimed that the country is heading in the right direction," the report stated.

A majority of business owners, 54%, criticised the current economic managers from the PML-N government, considering them worse than their predecessors. Meanwhile, 23% of respondents from the manufacturing sector saw no difference between the current and previous governments.

A sweeping majority of business owners, 85%, did not consider the government’s new financial plan a "good budget". Only 11% of manufacturers and 15% of service providers deemed it business-friendly.

High inflation and poor business conditions led to a 9% increase in employers, particularly manufacturers, reducing their workforce in the second quarter. Six out of 10 businesses reported worse sales this year, with 66% of manufacturers and 58% of service providers noting a decline.

"Governments in Pakistan need to listen and address the voice of business communities across Pakistan," Gilani urged.

tribune.com.pk

Business owners slam govt for ‘economic mismanagement’ amid rising inflation, taxes | The Express Tribune

Prime Minister Shehbaz Sharif's govt termed ‘worse’ manager of economy, according to Gallup survey
tribune.com.pk tribune.com.pk
 

Pakistan secures $400 million loan from ADB​


The Asian Development Bank (ADB) has approved a $400 million concessional loan to support the reconstruction of houses and community infrastructure in Sindh province which was severely affected by the 2022 floods.

The Sindh Emergency Housing Reconstruction Project aims to rehabilitate damaged homes and community infrastructure, with a focus on enhancing climate resilience.

The initiative is part of ADB's broader commitment of $1.5 billion in assistance from 2023 to 2025 to accelerate Pakistan's flood recovery efforts.

"This project will help rebuild homes and restore livelihoods and essential services in Sindh, the province hardest hit by the 2022 floods," said ADB Director General for Central and West Asia Yevgeniy Zhukov.

Sindh province sustained 83% of the total housing damage from the 2022 floods, with about 2.1 million homes either destroyed or damaged.

Many victims still reside in inadequate, temporary shelters lacking essential services.

The project will provide conditional cash grants to rebuild 250,000 homes with resilient designs and support the construction of infrastructure such as drinking water and sanitation facilities, covered drainage, and renewable energy solutions for 100,000 households in around 1,000 flood-affected villages in Sindh.

Additionally, grants for livestock, agriculture, small enterprises, and e-commerce will be provided.

"ADB’s support will help Pakistan build back better and promote community-led climate resilience and disaster risk management," said ADB Director for Water and Urban Development Srinivas Sampath.

"We are coordinating with other development partners to support the government’s recovery and reconstruction priorities."

The project aligns with the government’s resilient rehabilitation, reconstruction, and recovery strategy (4RF) and will follow an integrated approach to ensure complementary investments across sectors.

A $500,000 technical assistance grant will support the government’s operational capabilities.

tribune.com.pk

Pakistan secures $400 million loan from ADB for flood recovery | The Express Tribune

The funds will support the Sindh Emergency Housing Project for flood rehabilitation, says statement
tribune.com.pk tribune.com.pk
 

China and Saudi Arabia expected to rollover $9 billion debt for Pakistan​


Pakistan is anticipated to secure a rollover of $9 billion in debt from China and Saudi Arabia for the fiscal year 2024-25.

In addition, Pakistan is seeking funding for the Diamer-Bhasha Dam project.

Sources from the Ministry of Economic Affairs indicate that Pakistan expects a $500 million facility from the Islamic Development Bank for oil and commodities.

However, there is no expectation of an extension for the existing oil credit facility from Saudi Arabia.

The ministry sources also revealed that Pakistan faces over $20.8 billion in payments this year.

The Geneva Donor Conference in 2023 had promised $10.7 billion, but only $3 billion has been received so far. Pakistan is also working to secure funding based on commitments made at donor conferences.

Furthermore, Pakistan anticipates a $1 billion loan from the World Bank for the Dasu Hydropower Project.

The Asian Infrastructure Investment Bank is expected to provide financing for the N-5 project.

tribune.com.pk

China and Saudi Arabia expected to roll over $9 billion debt for Pakistan | The Express Tribune

Sources say Islamabad expects a $500 million facility from Islamic Development Bank for oil and other commodities
tribune.com.pk tribune.com.pk
 

Traders threaten nationwide protests against govt’s tax policies​


The trader community has threatened to take to the streets in protest against the government's new tax scheme, which they have labelled as "anti-trader."

The All Pakistan Anjuman-e-Tajiran (APAT) and the Traders Action Committee have issued directives to traders nationwide, urging them to prepare for demonstrations.

Ajmal Baloch, President of APAT and the Traders Action Committee Islamabad, stated on Saturday that the trader community across Pakistan has outright rejected the government's newly introduced trader-friendly tax scheme, describing it as "anti-trader."

He called on the Federal Board of Revenue (FBR) to withdraw the SRO immediately and engage in negotiations based on traders' suggestions.

"The valuation table set by the FBR is impractical and unjust to various markets in smaller cities, as well as in Islamabad, Lahore, Karachi, Multan, Quetta, Peshawar, and Faisalabad," Baloch said. "What is the fault of the old taxpayers who are also included in this scheme? Expanding the tax net is necessary, but the question lies in FBR's capacity."

Baloch emphasised that traders across the country have been advised to prepare for protests and shutdowns, declaring that the trader-friendly scheme will not be implemented under any circumstances.

Speaking at an online consultative meeting with Malik Mehr Ilahi, President of Khyber-Pakhtunkhwa Traders, Abdul Rahim Kakar, President of Balochistan Traders, Abdul Qayoom Qureshi, President of Sindh Traders, Jameel Ahmed Paracha, Chairman of Sindh Traders Ittehad, Iftikhar Feroz, President of Azad Kashmir Traders, and Tariq Kareem, President of South Punjab Traders, Baloch highlighted the dire situation faced by traders.

"There has been a 70% decline in purchasing across the country. Electricity bills have broken the traders' backs. Under such conditions, it has become extremely difficult to conduct business, and if the situation persists, traders will be forced to shut down their businesses," Baloch warned.

tribune.com.pk

Traders threaten nationwide protests against govt’s tax policies | The Express Tribune

Community outrightly rejects govt's newly introduced trader-friendly tax scheme, describing it as ‘anti-trader’
tribune.com.pk tribune.com.pk
 
Proposed pledged promised expected , all stories so far nothing concrete , chaos calamity catastrophe this is synonym for Pak economy
 
The State Bank of Pakistan (SBP) on Monday announced a one per cent reduction in the interest rate, bringing it down to 19.5 per cent

This was revealed by SBP Governor Jameel Ahmad during a media briefing following the monetary policy meeting.

Ahmad stated that inflation is gradually decreasing, and the country's economy is on a path to recovery. Consequently, the monetary policy committee decided to reduce the interest rate by 100 basis points, lowering it to 19.5 per cent, he added.

The decision comes as a measure to support economic growth, with the central bank optimistic about further improvements in economic indicators.

"The reduction in the interest rate reflects our confidence in the current economic trajectory," he said.

He said that future projections expect the average inflation rate to stabilize between 23% and 25%, following last year's 23.4%.

Earlier in June, Pakistan's central bank had cut its key policy rate for the first time in four years, lowering it by 1.5 percentage points to 20.5% due to a significant slowdown in inflation, which dropped to 11.8% in May from a high of 38% in May 2023.

A reduction in the current account deficit was also reported, with the deficit decreasing to $700 million in the last fiscal year. Foreign exchange reserves saw a significant increase, rising by $5 billion to reach $9.4 billion by June 2024.

Governor Ahmad announced the removal of all import restrictions, facilitating seamless external payments. Despite a monthly increase of $1.3 billion in imports, reserves have remained stable. Banks have resumed dividend payments to foreign investors, transferring $2.2 billion in profits abroad, marking a sevenfold increase in profit repatriation.

Improvements were noted in payments for airline royalties and technical fees. The SBP has made it easier for importers to conduct transactions through their banks without needing prior central bank approval.

The oil import bill has decreased significantly, dropping from $2.3 billion to $1.4 billion in the first quarter due to lower international prices and reduced volumes. This reduction has provided substantial support. Non-oil imports stood at $3.2 billion, reflecting an increase of over $1 billion.

For the current fiscal year, GDP growth is projected to be between 2.5% and 3.5%.

Source: The Express Tribune
 
Govt likely to provide income tax relief to salaried class

In a move to ease the financial burden, the Government of Pakistan is considering to provide income tax relief to the salaried class citizens, ARY News reported on Friday, citing sources.

Sources close to the development revealed that the Prime Minister Shehbaz Sharif has tasked the economic team to revise the current income tax rate on salaried class earning up to Rs 100,000 per month.

In the recent budget, the government had increased the income tax rate to 2.5 percent on monthly salaries up to Rs 100,000.

Sources indicate that this 2.5 percent tax may be partially or fully withdrawn to provide relief to the salaried class individuals.

This initiative will result in a revenue shortfall of approximately Rs 40 billion. Sources suggest that this shortfall will be compensated by reducing the Public Sector Development Program (PSDP).

The proposed income tax relief for the salaried class will also be discussed with the International Monetary Fund (IMF), sources said.


ARY News
 
PM Shehbaz says officially requested China to reschedule debt for five years

Prime Minister Shehbaz Sharif said on Sunday that he has formally requested China to reschedule Pakistan’s debt for a period of five years.

“We hope that the Chinese government will positively respond to this request,” he said while talking to a group of reporters who recently visited China at the government’s invitation.

Last week, the premier told his cabinet members that he has written a letter to the Chinese government seeking debt reprofiling for Pakistan as the country takes steps to secure the International Monetary Fund bailout package. PM Shehbaz added that Chinese President Xi Jinping had shown “keen interest in his idea” of using local coal to cut down imports.

In his first press conference after visiting China, Finance Minister Muhammad Aurangzeb told reporters that the country has sought the reprofiling of more than $27 billion in debt and liabilities with friendly nations — China, Saudi Arabia, and the UAE — to secure $7 billion loan programme from the Fund.

Debt reprofiling refers to “modifications of the aggregate schedule of future country repayments through refinancing, debt substitution, or renegotiations,” according to the World Bank.

In Lahore on Sunday, PM Shehbaz told journalists that multiple Chinese companies would be investing in Pakistan in the coming period. “The prosperity of the Chinese people is rooted in their unity, which the Pakistani people must also emulate to achieve their economic development goals.”

Moreover, the premier said that he was “fully aware” of the issues surrounding inflation and electricity and reviewing the priorities related to independent power producers (IPPs).

“Households using up to 200 units of electricity will be provided relief,” he said.

Many economic experts blame the past governments for signing expensive power agreements with the IPPs. According to economist Kaiser Bengali, the government was even paying for the electricity that was not produced.

The economist stated that the cost-plus revenue, capacity payments, and dollarised payments to IPPs were also a disaster.

The journalists informed the premier about the “success” of their China visit, which was organized by the China Public Diplomacy Association. The journalist delegation included Shehryar Hasnat, Salman Ghani, Amir Mir, Khizar Gondal, Khalid Hussainain, Azam Malik, and Abdul Muti. They visited Beijing, Shenzhen, and Guangzhou on the invitation of the Chinese government.

PM Shehbaz hailed Pakistan’s friendship with China and claimed that he was able to achieve “important objectives during his recent visit to the neighbouring country.

He went on to add that there would be no compromise on the security of Chinese residents working in Pakistan. He emphasised that the government and its institutions “are on the same page when it comes to the protection of Chinese nationals, considering it their responsibility.”

The premier also reaffirmed the government’s commitment to the China-Pakistan Economic Corridor (CPEC) project. “CPEC will continue, and the incumbent government’s effort is to complete the CPEC projects as soon as possible during their tenure.”



AAJ News
 
Cricket Warrior said:
PM Shehbaz says officially requested China to reschedule debt for five years

Prime Minister Shehbaz Sharif said on Sunday that he has formally requested China to reschedule Pakistan’s debt for a period of five years.

“We hope that the Chinese government will positively respond to this request,” he said while talking to a group of reporters who recently visited China at the government’s invitation.

Last week, the premier told his cabinet members that he has written a letter to the Chinese government seeking debt reprofiling for Pakistan as the country takes steps to secure the International Monetary Fund bailout package. PM Shehbaz added that Chinese President Xi Jinping had shown “keen interest in his idea” of using local coal to cut down imports.

In his first press conference after visiting China, Finance Minister Muhammad Aurangzeb told reporters that the country has sought the reprofiling of more than $27 billion in debt and liabilities with friendly nations — China, Saudi Arabia, and the UAE — to secure $7 billion loan programme from the Fund.

Debt reprofiling refers to “modifications of the aggregate schedule of future country repayments through refinancing, debt substitution, or renegotiations,” according to the World Bank.

In Lahore on Sunday, PM Shehbaz told journalists that multiple Chinese companies would be investing in Pakistan in the coming period. “The prosperity of the Chinese people is rooted in their unity, which the Pakistani people must also emulate to achieve their economic development goals.”

Moreover, the premier said that he was “fully aware” of the issues surrounding inflation and electricity and reviewing the priorities related to independent power producers (IPPs).

“Households using up to 200 units of electricity will be provided relief,” he said.

Many economic experts blame the past governments for signing expensive power agreements with the IPPs. According to economist Kaiser Bengali, the government was even paying for the electricity that was not produced.

The economist stated that the cost-plus revenue, capacity payments, and dollarised payments to IPPs were also a disaster.

The journalists informed the premier about the “success” of their China visit, which was organized by the China Public Diplomacy Association. The journalist delegation included Shehryar Hasnat, Salman Ghani, Amir Mir, Khizar Gondal, Khalid Hussainain, Azam Malik, and Abdul Muti. They visited Beijing, Shenzhen, and Guangzhou on the invitation of the Chinese government.

PM Shehbaz hailed Pakistan’s friendship with China and claimed that he was able to achieve “important objectives during his recent visit to the neighbouring country.

He went on to add that there would be no compromise on the security of Chinese residents working in Pakistan. He emphasised that the government and its institutions “are on the same page when it comes to the protection of Chinese nationals, considering it their responsibility.”

The premier also reaffirmed the government’s commitment to the China-Pakistan Economic Corridor (CPEC) project. “CPEC will continue, and the incumbent government’s effort is to complete the CPEC projects as soon as possible during their tenure.”



AAJ News
Click to expand...
In Lahore on Sunday, PM Shehbaz told journalists that multiple Chinese companies would be investing in Pakistan in the coming period. “The prosperity of the Chinese people is rooted in their unity, which the Pakistani people must also emulate to achieve their economic development goals.”

Our politicians have these lines on auto pilot. Big investments coming soon guys, hold on!
 
Pakistan ‘targets’ $1.3bln financing under Geneva donors moot

According to sources, the Ministry of Planning and the Ministry of Economic Affairs have completed their working for the current financial year, and the amount will be spent on flood recovery and rehabilitation and development projects.

This funding is part of the international community’s efforts to support Pakistan in the aftermath of the catastrophic floods.

Pakistan has so far received $3 billion under the Geneva Donors Conference and is expected to receive up to $10 billion by 2027.

The funding will be allocated to the provinces and the federal government to spend on the rehabilitation and development of areas affected by the flood. The World Bank, Asian Development Bank, and Asian Infrastructure Bank are among the donors that will provide funding under the Geneva Donors Conference.

It is pertinent to mention here that PM Shehbaz Sharif co-hosted an international conference on ‘Climate Resilient Pakistan’ in Geneva along with United Nations Secretary General Antonio Guterres.

The conference brought together governments, leaders from the public and private sectors and civil society to support the people and the government of Pakistan to deal with the enormous challenge of post-flood reconstruction and rehabilitation.

Pakistan secured over $10 billion in pledges from international financial institutions, donor agencies and development partners for the rehabilitation, recovery and reconstruction of flood-affected areas, during the International Conference.

The major pledges made at the conference, co-chaired by Pakistan and the United Nations in Geneva, Switzerland, included $4.2 billion from the Islamic Development Bank (IsDB), $2 billion from the World Bank, $1.5 billion from the Asian Development Bank (ADB), $1 billion from the Asian Infrastructure Investment Bank (AIIB) and $1 billion from Saudi Arabia, according to the state news agency.

arynews.tv

Pakistan 'targets' $1.3bln financing under Geneva donors moot

ISLAMABAD: Pakistan has targeted $1.3 billion in financing under the Geneva Donors Conference, with $1 billion for project financing and an additional
arynews.tv arynews.tv
 
Taxation and taxation FUK, Pakistanis have paid 850billions tax on Internet and cellphones, what more these leeches want , compare it with capacity payment to IPP and subsidy on energy and fuel to elite.

Understandable economy cannot expand in this situation, unemployment is high and so is inflation, but why does not this stooge of a PM takes two initiatives.

End the free electricity and fuel to all civil and defense persons. Revoke capacity payments to national private IPP owners
 
Kianig89 said:
Taxation and taxation FUK, Pakistanis have paid 850billions tax on Internet and cellphones, what more these leeches want , compare it with capacity payment to IPP and subsidy on energy and fuel to elite.

Understandable economy cannot expand in this situation, unemployment is high and so is inflation, but why does not this stooge of a PM takes two initiatives.

End the free electricity and fuel to all civil and defense persons. Revoke capacity payments to national private IPP owners
Click to expand...
The chota polish is a mere puppet. The real shots are taken somewhere else. He has no control so its irrelevant to criticize chota polish.
 
Not sure what these guys have to do anything with the electricity prices. If you know, You know.

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Consultations on reducing electricity prices underway with army chief and allies: PM Shehbaz

Prime Minister Shehbaz Sharif has announced that consultations with the Army Chief and political allies to devise a comprehensive plan to reduce electricity prices were underway.

Speaking at an Ulema and Mashaikh Conference in Islamabad, Sharif emphasised the unprecedented cooperation between the political government and constitutional institutions, stating it is crucial for the country's best interests.

The Prime Minister addressed the nation's economic challenges, highlighting the need to combat internal threats and misinformation on social media.

He condemned the disrespect shown to military martyrs and the divisive actions of certain groups, referencing the tragic events of May 9 and historical incidents from 1971.

While referring to Jamaat-e-Islami protests, the Prime Minister urged religious leaders to oppose societal divisions and promote national prosperity.

He acknowledged the burden of high electricity costs on households consuming 200 to 500 units and stressed the importance of ongoing efforts to alleviate this burden.

PM Shahbaz mentioned recent discussions with Nawaz Sharif, the Army Chief, and political leaders, revealing that a detailed plan is in progress.

Despite the challenges, PM Shahbaz expressed hope for relief from high electricity prices and announced that Punjab and Sindh would soon make relevant declarations.

He reiterated the necessity of the IMF programme to achieve economic stability and underscored the commitment of the political government, institutions, and the Army Chief to resolve the country's economic difficulties.

EXPRESS TRIBUNE
 
PM okays launch of ‘ease of doing business’ initiative

Prime Minister Shehbaz Sharif approved the launch of the “largest reform programme of Ease of Doing Business in history” to attract business and investment in Pakistan.

The PM approved the launch of the first digital registry of Pakistani laws and rules to promote business and investment.

He thanked international institutions for expressing their interest in funding the project. He called for finalisation of agreements with international institutions interested in funding of the project.

He thanked American development partners for their interest in assistance for implementation of the government’s agenda of economic reforms.

The prime minister said officials and ministries should ensure timely implementation of policy measures. He set up a special committee to focus on implementation of the project. In the first phase, sectors of high importance would be reformed.

Mr Shehbaz thanked Dr Scott Jacob for working on the project. He praised the Board of Investment and other departments for assistance in formulating a strategy for the project.

Besides Dr Scott Jacob, federal ministers Ahad Khan Cheema, Attaullah Tarar, Muhammad Aurangzeb, Abdul Aleem Khan, state minister Shaza Fatima Khawaja and chief secretaries of the four provinces attended the meeting.

Under the initiative, bureaucratic hurdles would be removed and the time needed for registration and permits and other crucial steps would be reduced through digitisation.

DAWN NEWS
 
Destruction goes on.

========================================

Super-rich companies exit Pakistan, divest billions in assets​


The exits span various sectors, reflecting broader concerns and strategic recalibrations by global corporations.

Pharmaceutical giant Pfizer (USA) sold its manufacturing operations in Pakistan to the Lucky Group in May 2024. This move marks a substantial withdrawal from a market where Pfizer had a longstanding presence. Energy behemoth Shell (Netherlands) divested its retail business and lubricants plant to the Wafi Energy Group. This sale underscores Shell’s strategic shift as it recalibrates its global portfolio.

Ride-hailing service Uber (USA) discontinued its operations in Pakistan, including its subsidiary Careem’s food delivery business. This cessation highlights challenges in the local market, including regulatory hurdles and competitive pressures.

French oil major TotalEnergies has agreed to sell its 50 percent stake in oil marketing company Total PARCO Pakistan Limited to global commodities trader Gunvor Group, the company said in a statement on Tuesday. Eli Lilly (USA) ceased its manufacturing operations in Pakistan in November 2022. The company’s withdrawal points to strategic realignments and possibly concerns over local market conditions. Sanofi (France) sold its 52.87 percent shareholding in Sanofi-Aventis Pakistan Limited to an investor consortium led by Packages Limited in April 2023. This divestment reflects Sanofi’s broader global restructuring efforts.

Telecommunications provider Telenor (Norway) sold its operations to Ufone/PTCL in December 2023. The move signifies a strategic exit from a highly competitive market where operational challenges have persisted. Viatris (USA) sold a portfolio of certain pharmaceutical brands to AGP Limited (AGP) in April 2023, marking another significant divestment in the healthcare sector. Lotte Chemical (South Korea) sold its assets in Pakistan to Lucky Core Industries in May 2023. This transaction highlights the reshuffling within the chemical industry amid global economic pressures.

These exits represent a substantial outflow of foreign investment, with companies capable of further investments or expansions opting to withdraw. The divestments raise questions about Pakistan’s investment climate and economic policies, posing challenges for the government to attract and retain foreign direct investment.

The cumulative impact of these withdrawals could be far-reaching, affecting employment, technological advancements and economic growth.

www.thenews.com.pk

Super-rich companies exit Pakistan, divest billions in assets

ISLAMABAD: Over the past two years, nine multi-billion, super-rich companies have divested their assets in Pakistan, signaling a significant shift in the country’s economic landscape.The exits...
www.thenews.com.pk
 
Last edited by a moderator:
Prime Minister Shehbaz Sharif will unveil an economic plan on August 14, which will focus on devising the main principles for real-time export-led growth and removing decade-old economic bottlenecks.

The plan was evolved by a task force constituted by the premier, later joined by Professor of Economic Policy at the University of Oxford Stefan Dercon over the past two months. The local team collated the facts and shared them with the professor to create a consensus document.

Well-placed sources told Dawn that the last meeting on the draft policy titled ‘Home-grown economic plan’ took place on Saturday and is now ready for presentation to the prime minister.

According to the sources, the economic plan’s contents will be disclosed to a large group of stakeholders following Independence Day.

The document’s main focus is on economic liberalisation, eliminating the government’s involvement in providing subsidies to any sector and exposing local producers to worldwide competition. There will be no restrictions on imports to manage the current account deficit; instead, the focus will be on increasing exports from the country.

According to a source in the Planning Commission, the evolving document continues the work of former chief economist Dr Muhammad Ahmed Zubair, who was hired by the PTI government.

According to a source, Mr Zubair’s policy statement also addressed structural challenges that hampered growth and elite capture of economic policy formulation. The policy also addressed structural flaws that have resulted in a concentration of export of raw materials and semi-finished products, rather than a shift towards high-value-added products.

Ex-premier Imran Khan approved the three-year implementation plan just a few days before his government was ousted in a no-confidence vote. The approved plan anticipated the export target to be $110 billion by the end of the policy.

However, the PDM government did not approve the policy for implementation. Then, according to the source, the caretaker government began work on establishing a new policy, and this effort is being further led by Planning Minister Ahsan Iqbal.

Mr Ahsan worked with the relevant parties to develop a five-year plan. During the deliberations on the plan, Professor Stefan Dercon penned an op-ed in Dawn in April 2024, advising the new administration to learn five lessons from recent development winners such as Indonesia, Ghana, Bangladesh and India.

According to the source, PM Shehbaz read this article and directed his team to engage Mr Stefan in discussions about the country’s economic plan. He abandoned previous proposed policy plans, including the one developed by his Planning Minister Ahsan Iqbal.

The source said this will be Pakistan’s first economic plan, as the government now only possesses budgetary documents. This document will set the course of the economy as the country has not had any economic plan in place for decades.

Mr Stefan referred to the finance ministry’s budget documents as a strategic blueprint for revenue and expenditure. The budgetary document is export-biased, with import volumes significantly lower than the economy’s needs. He said the lack of direction has caused economic distortions, making exports less competitive.

The economist also identified import tariffs, such as additional customs duty, regulatory duty and export duty, as one of the primary causes of Pakistan’s sluggish export growth. The finance ministry’s budget policy evolved to tax raw materials or semi-finished products, imposing taxes on rising sectors.

The new plan calls for less government participation in running the economy or supporting industries through subsidies or high tariff protection. The policy is based on the whole spirit of neoliberalism, which advocates open capital flow, investment, and a market-driven exchange rate.

Mr Stefen has written a book titled Development Bargain, in which a country’s elites change from safeguarding their positions to betting on a growth-based future.

Despite the flaws of such deals, China is one of the most notable recent success stories, along with Indonesia and less expected destinations like Bangladesh, Ghana, and Ethiopia. Gambling on Development is about these winning attempts, as opposed to countries trapped in elitist bargains that lead nowhere.

www.dawn.com

PM Shehbaz to unveil new economic plan on August 14 to drive liberalisation

Tariff protection, subsidies to go; local producers to be exposed to global competition.
www.dawn.com
 
Last edited by a moderator:
Paksitan economy is in meltdown, nothing left for any person its the black money which is keeping things afloat, the tax system is so complicated that majority takes it as a headache add to it the loopholes for elite to exploit it easily.
 
Foreign investors coming to Pakistan with confidence: Jam Kamal

Commerce Minister Jam Kamal has said that foreign investors are coming to Pakistan with confidence, ARY News reported on Sunday.

“The security situation has been satisfactory in Pakistan,” commerce minister talking to media here said.

“We are trying to bring investments for each sector of the country,” he said.

Federal minister said that the country faces energy crisis and vowed to jointly address the challenges faced by industries.

Jam Kamal yesterday said that the government has achieved target of eight to 8.5 bln dollars agriculture exports.

Addressing a press conference at Expo Centre in Karachi, federal commerce minister said that the investors from China, Germany and other countries called on him. “The investors have urged for turning farm products into value added products,” he said.

Commerce Minister said the government is providing a conducive environment to investors.

Addressing a Pak-China Trade Conference he said foreign investors will be facilitated to boost business and the economy in the country.

Jam Kamal said Pakistan offers a lot of investment opportunities in many sectors especially in agriculture and IT sector.

He said Pakistan wants to use advanced technology and modern methods for the development of the agriculture sector in the country, adding that the economy will strengthen with foreign investment.

arynews.tv

Foreign investors coming to Pakistan with confidence: Jam Kamal

KARACHI: Commerce Minister Jam Kamal has said that foreign investors are coming to Pakistan with confidence, ARY News reported on Sunday. "The security
arynews.tv arynews.tv
 
offstump said:
Prime Minister Shehbaz Sharif will unveil an economic plan on August 14, which will focus on devising the main principles for real-time export-led growth and removing decade-old economic bottlenecks.

The plan was evolved by a task force constituted by the premier, later joined by Professor of Economic Policy at the University of Oxford Stefan Dercon over the past two months. The local team collated the facts and shared them with the professor to create a consensus document.

Well-placed sources told Dawn that the last meeting on the draft policy titled ‘Home-grown economic plan’ took place on Saturday and is now ready for presentation to the prime minister.

According to the sources, the economic plan’s contents will be disclosed to a large group of stakeholders following Independence Day.

The document’s main focus is on economic liberalisation, eliminating the government’s involvement in providing subsidies to any sector and exposing local producers to worldwide competition. There will be no restrictions on imports to manage the current account deficit; instead, the focus will be on increasing exports from the country.

According to a source in the Planning Commission, the evolving document continues the work of former chief economist Dr Muhammad Ahmed Zubair, who was hired by the PTI government.

According to a source, Mr Zubair’s policy statement also addressed structural challenges that hampered growth and elite capture of economic policy formulation. The policy also addressed structural flaws that have resulted in a concentration of export of raw materials and semi-finished products, rather than a shift towards high-value-added products.

Ex-premier Imran Khan approved the three-year implementation plan just a few days before his government was ousted in a no-confidence vote. The approved plan anticipated the export target to be $110 billion by the end of the policy.

However, the PDM government did not approve the policy for implementation. Then, according to the source, the caretaker government began work on establishing a new policy, and this effort is being further led by Planning Minister Ahsan Iqbal.

Mr Ahsan worked with the relevant parties to develop a five-year plan. During the deliberations on the plan, Professor Stefan Dercon penned an op-ed in Dawn in April 2024, advising the new administration to learn five lessons from recent development winners such as Indonesia, Ghana, Bangladesh and India.

According to the source, PM Shehbaz read this article and directed his team to engage Mr Stefan in discussions about the country’s economic plan. He abandoned previous proposed policy plans, including the one developed by his Planning Minister Ahsan Iqbal.

The source said this will be Pakistan’s first economic plan, as the government now only possesses budgetary documents. This document will set the course of the economy as the country has not had any economic plan in place for decades.

Mr Stefan referred to the finance ministry’s budget documents as a strategic blueprint for revenue and expenditure. The budgetary document is export-biased, with import volumes significantly lower than the economy’s needs. He said the lack of direction has caused economic distortions, making exports less competitive.

The economist also identified import tariffs, such as additional customs duty, regulatory duty and export duty, as one of the primary causes of Pakistan’s sluggish export growth. The finance ministry’s budget policy evolved to tax raw materials or semi-finished products, imposing taxes on rising sectors.

The new plan calls for less government participation in running the economy or supporting industries through subsidies or high tariff protection. The policy is based on the whole spirit of neoliberalism, which advocates open capital flow, investment, and a market-driven exchange rate.

Mr Stefen has written a book titled Development Bargain, in which a country’s elites change from safeguarding their positions to betting on a growth-based future.

Despite the flaws of such deals, China is one of the most notable recent success stories, along with Indonesia and less expected destinations like Bangladesh, Ghana, and Ethiopia. Gambling on Development is about these winning attempts, as opposed to countries trapped in elitist bargains that lead nowhere.

www.dawn.com

PM Shehbaz to unveil new economic plan on August 14 to drive liberalisation

Tariff protection, subsidies to go; local producers to be exposed to global competition.
www.dawn.com
Click to expand...
Mr Stefen has written a book titled Development Bargain, in which a country’s elites change from safeguarding their positions to betting on a growth-based future.

Although I do find it odd that based off an Op Ed published in Dawn, Shehbaz and Co outsourced the development of an economic plan to a Cambridge professor and completed it in two months, what this guy talks about makes sense. Whether or not this actually happens is another case.
 
Multinational companies plan exit amid internet disruptions: Pakistan Business Council

The Pakistan Business Council (PBC) warned on Friday that several multinational companies are planning to relocate their back offices from Pakistan, with many having already done so recently.

The warning came amid a report by the Dubai Chamber of Commerce that 3,968 Pakistani companies registered in Dubai between January and June 2024 — making Pakistan the second-ranked country on the list. The figure was also 17 per cent higher than the 3,395 firms registered during the same period in 2023.

Last year, the Dubai Chamber of Commerce registered 8,036 new Pakistani businesses.

The surge in Dubai-based Pakistani businesses highlights a growing exodus from a country already grappling with severe unemployment and sluggish economic growth. As hundreds of thousands of skilled and unskilled workers have already left Pakistan, millions more are reportedly seeking opportunities abroad.

“Many multinational companies (MNCs) are either planning to relocate their back offices from Pakistan or have already done so, as the reported imposition of a firewall causes widespread internet disruptions across the country,” the PBC said in a statement.

This migration reflects a deepening lack of confidence in the government’s economic policies. Key factors contributing to this trust deficit include the high cost of doing business, political uncertainties, soaring electricity costs, and deteriorating law and order.

“While we struggle with the costs of idle capacity in power generation leading to unemployment and loss of exports and tax revenue, we now have to contend with the threat of idle capacity in the emerging software sector due to poor execution of a firewall,” the PBC said.

The tech industry has already expressed serious concern over the recent internet slowdown, warning that these disruptions could cost Pakistan up to $300 million. The PBC asked the authorities concerned to go back and get the right firewall or learn to apply it without creating an unnecessary impact on employment and exports.

“IT and IT-enabled services, besides agriculture and tourism, offer a valuable opportunity to achieve the PM’s export target over the next three years. High-speed connectivity is also vital for the domestic economy,” the council said.

The Overseas Investors Chamber of Commerce and Industry (OICCI) also warned that frequent internet disruptions in Pakistan could derail the country’s economic progress.

The Pakistan Software Houses Association said in a statement that these disruptions are not mere inconveniences but a direct, tangible and aggressive assault on the industry’s viability, inflicting devastating financial losses estimated to reach $300m, which can increase exponentially.

DAWN NEWS
 
FearlessRoar said:
Foreign investors coming to Pakistan with confidence: Jam Kamal

Commerce Minister Jam Kamal has said that foreign investors are coming to Pakistan with confidence, ARY News reported on Sunday.

“The security situation has been satisfactory in Pakistan,” commerce minister talking to media here said.

“We are trying to bring investments for each sector of the country,” he said.

Federal minister said that the country faces energy crisis and vowed to jointly address the challenges faced by industries.

Jam Kamal yesterday said that the government has achieved target of eight to 8.5 bln dollars agriculture exports.

Addressing a press conference at Expo Centre in Karachi, federal commerce minister said that the investors from China, Germany and other countries called on him. “The investors have urged for turning farm products into value added products,” he said.

Commerce Minister said the government is providing a conducive environment to investors.

Addressing a Pak-China Trade Conference he said foreign investors will be facilitated to boost business and the economy in the country.

Jam Kamal said Pakistan offers a lot of investment opportunities in many sectors especially in agriculture and IT sector.

He said Pakistan wants to use advanced technology and modern methods for the development of the agriculture sector in the country, adding that the economy will strengthen with foreign investment.

arynews.tv

Foreign investors coming to Pakistan with confidence: Jam Kamal

KARACHI: Commerce Minister Jam Kamal has said that foreign investors are coming to Pakistan with confidence, ARY News reported on Sunday. "The security
arynews.tv arynews.tv
Click to expand...
Why would Foreign investors come to PK when all the establishment and Govt steal everything and take it abroad.
 
Shipping giant Maersk to invest $2b in Pakistan

Danish shipping company Maersk has announced to invest $2billion in Pakistan’s port and transport infrastructure over the next two years.

According to state-owned news agency, the investment under this project will contribute to the infrastructure development and economic improvement.

In this regard, Minister for Maritime Affairs Qaiser Ahmed Sheikh will visit Denmark this month for the signing of a Memorandum of Understanding (MoU) between Maersk Shipping Company and Karachi Port Trust.

In a statement Qaiser Ahmed Sheikh said that Karachi has great potential to increase exports and the Maritime Affairs ministry is providing an enabling environment to the business community in this regard.

Last month, the Chief Executive Officer of Abu Dhabi Ports Pakistan, Khurram Aziz Khan, announced a $250 million investment in Karachi Port over the next ten years during a meeting with Prime Minister Shehbaz Sharif.

Accompanied by a delegation, Khan also detailed a $130 million investment in a fully equipped multipurpose terminal, set to be completed within two years.

The delegation briefed the prime minister on the enhancements to the container terminal facility at Karachi Port, which will include automated gates, an expanded berth, a crane rail track, and new infrastructure.

arynews.tv

Shipping giant Maersk to invest $2b in Pakistan

Danish shipping company Maersk has announced to invest $2billion in Pakistan's port and transport infrastructure over the next two years. According to
arynews.tv arynews.tv
 
PM Shehbaz pins hopes on IT Park to achieve $25bn export milestone

Prime Minister Shehbaz Sharif on Monday said the completion of the Information Technology Park project would help boost the country’s exports in this sector and be a significant milestone in achieving the $25 billion IT exports target.

The prime minister, while chairing a meeting to review ongoing IT projects, digitisation efforts, and initiatives to boost IT exports, expressed satisfaction with the progress on the IT Park project in Islamabad.

He instructed officials to consult with Korean experts to explore ways to reduce the project’s completion timeline, according to a press release issued by the PM Office’s Media Wing.

The meeting was informed that construction on the IT Park project was progressing rapidly, with the Korean company revising its completion deadline to February 2025, from the previously announced June 2025.

Capital Development Authority teams were conducting regular site visits to monitor and oversee the project’s progress.

The meeting was attended by ministers Ahsan Iqbal, Ahad Khan Cheema, Muhammad Aurangzeb and Attaullah Tarar, Minister of State for IT Shaza Fatima Khawaja, Deputy Chairman of Planning Commission Jehanzaib Khan, PM’s coordinators Malik Mukhtar Bharath and Rana Ahsan Afzal and relevant senior officials.

Cargo shift

Prime Minister Shehbaz on Monday instructed the concerned authorities to bring 50 per cent of all public sector cargo inland via sea through Gwadar Port.

The prime minister issued the directives while chairing a review meeting on Chinese investment in Pakistan, where he was briefed on the visit of a Chinese experts’ delegation to the country from July 30 to August 6.

The meeting was informed that the Chinese delegation met representatives of various ministries who gave suggestions regarding increasing cooperation in related fields.

During the visit of the delegation, significant progress was made in terms of cooperation and investment in the fields of trade and investment, energy, agriculture, information technology, communication and infrastructure.

The meeting was informed that services of Chinese experts would be hired to increase domestic exports and eliminate non-trade barriers. Shows on different sectors will be organised in different cities of China to increase exports of Pakistani products.

DAWN NEWS
 
The kekra oil reserves will prove to be a game changer for Pakistan. It’s like the arrival of Shahid Afridi.
 
BouncerGuy said:
PM Shehbaz pins hopes on IT Park to achieve $25bn export milestone

Prime Minister Shehbaz Sharif on Monday said the completion of the Information Technology Park project would help boost the country’s exports in this sector and be a significant milestone in achieving the $25 billion IT exports target.

The prime minister, while chairing a meeting to review ongoing IT projects, digitisation efforts, and initiatives to boost IT exports, expressed satisfaction with the progress on the IT Park project in Islamabad.

He instructed officials to consult with Korean experts to explore ways to reduce the project’s completion timeline, according to a press release issued by the PM Office’s Media Wing.

The meeting was informed that construction on the IT Park project was progressing rapidly, with the Korean company revising its completion deadline to February 2025, from the previously announced June 2025.

Capital Development Authority teams were conducting regular site visits to monitor and oversee the project’s progress.

The meeting was attended by ministers Ahsan Iqbal, Ahad Khan Cheema, Muhammad Aurangzeb and Attaullah Tarar, Minister of State for IT Shaza Fatima Khawaja, Deputy Chairman of Planning Commission Jehanzaib Khan, PM’s coordinators Malik Mukhtar Bharath and Rana Ahsan Afzal and relevant senior officials.

Cargo shift

Prime Minister Shehbaz on Monday instructed the concerned authorities to bring 50 per cent of all public sector cargo inland via sea through Gwadar Port.

The prime minister issued the directives while chairing a review meeting on Chinese investment in Pakistan, where he was briefed on the visit of a Chinese experts’ delegation to the country from July 30 to August 6.

The meeting was informed that the Chinese delegation met representatives of various ministries who gave suggestions regarding increasing cooperation in related fields.

During the visit of the delegation, significant progress was made in terms of cooperation and investment in the fields of trade and investment, energy, agriculture, information technology, communication and infrastructure.

The meeting was informed that services of Chinese experts would be hired to increase domestic exports and eliminate non-trade barriers. Shows on different sectors will be organised in different cities of China to increase exports of Pakistani products.

DAWN NEWS
Click to expand...
IT park after IT park but no internet available 😂
 
The State Bank of Pakistan (SBP) decided to replace currency notes with denominations ranging from Rs 10 to Rs 5,000, ARY News reported

According to details, SBP Governor Jameel Ahmed told the Senate Standing Committee on Finance that the central bank will soon permission from the federal cabinet to introduce the new currency note. He said that new currency note denominations of Rs 10, Rs 20, Rs 50, Rs 100, Rs 500, Rs 1000, and Rs 5000 having all new features will be issued by December 2024.

The Senate Standing Committee on Finance chaired by Senator Farooq H Naik was also briefed by the SBP governor that contrary to rumors, the Rs 5,000 note will not be phased out, but replaced with a new design.

The SBP governor said that besides paper currency note, plastic notes made from polymeric material will also be issued. “Plastic currency will be used in the future if it proves to be more durable than paper currency,” the Jameel Ahmed added.

Read More: Pakistan to get new currency notes of all denominations

During the meeting, Senator Mohsin Aziz proposed to phase out Rs 5000 note to curb smuggling, however his suggestion was rejected by the SBP governor.

“The Rs 5,000 note will not be phased out and no such proposals are being considered.” The SBP governor said.

Source: Ary News
 
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