Pakistan Economy - News & Updates - Archive

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Valued members and guests!

I've initiated this new thread to report a daily update about our growing economy.
I'll be providind newsarticles, editorials, opinions, surveys and stats from global media.

Please do join me and don't hesitate to contribute if you have interesting news you'd like to share with me and other readers of this thread.

Enjoy! :thumbsup:

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Pakistan's economy to remain robust: survey


ISLAMABAD (March 31 2006): Pakistan's economy would remain robust this year with gross domestic production (GDP) growth rate at 6.5 percent, says the Economic and Social Survey of Asia and the Pacific-2006.

However, there are concerns about the overall budgetary deficit in years ahead as it may rise again. Besides, weak buoyancy of tax revenue, unemployment and poverty still remain the big challenges.

The survey launched here on Thursday points out that the economy of the Asian Pacific region grew strongly in 2005, aided by a buoyant global economy and the region should maintain its growth momentum in 2006, barring any unfavourable external events.

For 2006, the survey forecasts that oil prices will fluctuate within the range of $50-55. There are fears, however, that they may touch $100 a barrel within the next four years.

Despite high global energy prices, the price pressures rose only moderately in 2005 and are expected to remain muted or even ease slightly in 2006.

The Unescap has praised Pakistan's impressive economic growth in 2005. The GDP growth of 8.4 percent in 2005 was the highest in the last two decades. The factors which contributed to acceleration were strong domestic demand, better weather conditions for agriculture, continuity of economic policies and a robust financial sector.

The government had set a growth target of 7 percent of GDP for 2006, less than the rapid 8.4 percent achieved in 2005 but higher than the long-term growth trajectory of 6 percent.

A number of factors may interfere however; agriculture, prone to weather-related fluctuations, may perform below expectations. On the other hand, large-scale manufacturing may achieve the target and growth in services is expected to remain strong. Sustaining a higher growth rate is thus possible.

The earthquake is expected to have a minimal impact on economic growth. Natural disasters, damage and destroy assets, however, the repair and rebuilding of these assets generates economic activity that can help growth. Keeping all these factors in view, the surveys indicates that the GDP should grow 6.5 percent or higher in 2006.

There are indications that the economy as a whole is not likely to lose momentum in the short-term as a result of the devastating quake.

There was a sharp increase in nominal investment supported by strong macroeconomic fundamentals, increased availability of credit and a significant rise in foreign direct investment (FDI).

However, the investment to GDP ratio has remained at about 17 percent in the last four years. On the supply side, agriculture performed exceptionally well in 2005, with good weather and supportive government policies contributing to growth rate of 7.5 percent, an increase of 2.2 percent than in 2004.

Large-scale manufacturing recorded an impressive and broad-based growth rate of 15.4 percent in 2005. The service sector grew by 7.9 percent in 2005, in line with the higher growth in the commodity-producing sectors.

Inflationary pressure strengthened considerably in 2005, as inflation rose from 4.6 percent in 2004 to 9.3 percent.

Three years of strong economic growth, complemented by record low interest rates and the ongoing structural shift of many households towards higher consumption have injected new vigour into domestic spending.

This spending, coupled with rising oil and other commodity prices, contributed to a sharp increase in inflation in 2005. Food inflation reached double digits, a heavy burden on the poor who spend most of their income on food.

The government took several measures to ease inflationary pressures by not passing on to consumers the entire increase in the international prices and it began to tighten monetary policy to ease demand pressures.

The inflation is expected to drop to about 8 percent in 2006, pulled down by the decline in aggregated demand implicit in the lower growth estimate, a high base effect for 2006 prices and an anticipated improvement in food supplies.

However, prices of construction materials are expected to increase at a faster pace because of supply bottlenecks associated with the reconstruction work in the wake of the earthquake.

Budget deficit brought down to a relatively low level in recent years may rise again. In fiscal year 2005, it stood at 3.3 percent of the GDP.

Tax revenue buoyancy remained weak, as reflected in the continuing fall in the tax to GDP ratio that limits the government's ability to provide adequate funds for infrastructure and social programmes.

High growth of exports was outpaced by even higher growth of imports and current account turned into deficit. In 2005, while exports grew at a healthy rate of 16.9 percent, imports grew almost twice as fast, at 32.3 percent.

Higher oil prices led to a substantial increase in import payments and to higher shipment charges and so to higher prices for other imports as well. While growing domestic demand boosted import, imports of machinery and raw material also increased substantially.

Coupled with these large remittances, gains from the lower interest payments on Pakistan's external debt and liabilities partially offset the impact of the large trade gap. As a result, the current account deficit was contained in 2005.

The survey points out that there has been a significant increase in net inflows of capital in 2005. Capital inflows included mainly one-off inflows and an increase in concessional long-term loans from the World Bank and the Asian Development Bank. Foreign Direct Investment (FDI) reached $1.5 billion in 2005, 61 percent higher than in 2004. New FDI is so far concentrated in a few sectors such as telecommunications, finance and insurance and oil and gas exploration.

Following the adoption of a robust strategy of debt reduction, Pakistan's external debt declined from $37.9 billion at June-end 2000 to $36.6 billion at March-end 2005.

Highlighting the challenges, the survey says that the government expenditure related to the earthquake is likely to put pressure on the budgetary balance but with the continuing fiscal discipline, prudent monetary policy and focused attention on improving infrastructure and social sector indicators, the economy should maintain its medium-term growth trajectory.

Besides, enhancing the buoyancy of tax revenues, the growth in current expenditure needs to be curtailed and imbalances in the external sectors need to be addressed to ensure that the economy does not deviate from the growth path, achieved in the past few years.

Volatile oil prices: The current bout of high oil prices is hurting countries and if oil prices rise further by $10 a barrel, GDP growth of a developing country such as Pakistan can drop by 0.5 percent, inflation can rise up to one percent and current account deficit can widen up to 0.3 percent of the GDP.

The Challenge of Avian Influenza: The region has suffered significant human and economic losses as a result of the outbreak of H5N1 and estimates of human deaths from a possible global pandemic of the highly pathogenic avian influenza range from five million to 150 million people.

As a conservative loss in GDP from a pandemic would amount to $200 billion in just one quarter and in a worst case-scenario could plunge the global economy into recession.

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Rs 825-Rs 850 billion likely revenue target for 2006-07
ISLAMABAD (March 11 2006): The Central Board of Revenue (CBR) has conveyed to the International Monetary Fund (IMF) that the revenue collection target for 2006-07 would range between Rs 825 billion and Rs 850 billion, depending on the continuity in the current pace of revenue collection till the end of 2005-06.

Official sources told Business Recorder on Friday that the initial sketch of tax projections for 2006-07 was discussed by the tax authorities and Fund mission during recent series of meetings convened by the Board.

IMF technical mission, comprising Schimmelpfennig, Flecher, Hakura, Savastano and Di Tata, held a series of meetings with CBR Chairman Abdullah Yusuf and his reform team headed by Member Tax Policy and Reforms Khawaja Tanveer Ahmed and other members including Member Income Tax Salman Nabi, Member Sales Tax Shahid Ahmed and Member Customs. Presently, the mission is in the process of revamping of the taxation system under Article IV Consultation.

Sources said that CBR has estimated to collect Rs 708 billion by the end of current fiscal year against the target of Rs 690 billion, showing an increase of Rs 18 billion. The estimated target, of Rs 825 to 850 billion, for 2006-07 would be substantially higher than the target of Rs 690 billion set for 2005-06.

Officials said that CBR has not yet finalised the exact target for 2006-07. Taking into account the economic indicators, like GDP growth rate, inflation and reform initiatives including expansion of tax-base, sources said that the break-up of tax-wise projections would be hammered out on the basis of final revenue collection in 2005-06.

Keeping in view the previous years' trend of revenue collection, the initial tax projections have been worked out between Rs 825 and 850 billion for the next financial year.

Officials said that CBR would be able to surpass the target through broadening of tax base, voluntary compliance and increase in imports of dutiable items.

The CBR members also briefed the IMF team on tax-wise performance, including income tax, sales tax, federal excise duty (FED) and customs duty, officials added.

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Pakistan's investment climate favourable: Merrill Lynch
ISLAMABAD (updated on: March 14, 2006: Merrill Lynch Investment, one of the world's largest investment management organisations, has shown its interest to avail opportunities of Pakistan's emerging mutual fund market.

The interest was shown by Managing Director Merrill Lynch Investment, David Graham, who called on Dr. Salman Shah Advisor to PM on Finance and Economic Affairs here on Tuesday and described the investment climate of Pakistan favourable for foreign investment.

The Managing Director is currently visiting Pakistan to explore possibilities of investment including portfolio investment prospects in Pakistan.

Merrill Lynch Investment has over $500 billion of assets under worldwide management.

They have also singed an agreement with one of the largest US Investment Management Firm M/S Black Rock and the combined assets of both entities are approximately one trillion dollars. KASB is the local affiliate of Merrill Lynch.

Welcoming David Graham to Pakistan, Dr. Salman Shah said that Pakistan's economy is growing rapidly and integrating in the regional and global markets. Pakistan offers tremendous investment opportunities in various sectors including portfolio investment.

He said, "we have introduced structural reforms in fiscal, financial sectors and the corporate governance has improved."

The investment policy of Pakistan is business friendly and liberal as compared to other countries of the region. It also provides liberal tax incentive, he added.

The Advisor said, "we are in the process of converting state owned National Saving Departments into a corporate body to make it more investor friendly and market-oriented."

The Advisor assured all possible support to Merrill Lynch on behalf of the Government.

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Pakistan spending more on development:
ISLAMABAD (March 15 2006): Prime Minister Shaukat Aziz said on Tuesday that Pakistan is now spending more on development than ever before, thanks to the additional fiscal space made available by efficient revenue collection and better debt management.

Consequently, the overall poverty in the country has declined by 6.7 percent, and the unemployment rate for the current year has fallen to 6.8 percent, he said, and added that the expected GDP growth is close to 6.5-7 percent in 2005-06, which would be well within the growth target of 6 to 8 percent.

The Prime Minister was talking to World Bank Vice-President for South Asia Praful C. Patel, who called on him at the Prime Minister House. He said economic growth is expected to maintain its momentum despite the tragic loss of life and large-scale destruction in the wake of October 8 earthquake and spikes in oil prices surging to $70 per barrel. Shaukat Aziz said the high growth rate has resulted in benefits as well as challenges, adding the government will take steps to bring down inflation as well as the interest rate regime and keep ready to cope with any global downturn. Bridging the skills gap, redistribution of wealth and more jobs for an increasing labour force, including human resource development and institutional capacity building are other challenges that the government is preparing to meet, he added.

The Prime Minister said: "The strong and sustained economic growth over the last several years is underpinned by our economic philosophy based on deregulation, liberalisation, privatisation and truly home grown wide-ranging and deep structural reforms, consensus, continuity, consistency and transparency in our policies, growing domestic demand and renewed confidence of the private sector, improved fiscal discipline and debt-restructuring with currency stabilisation, rising public sector development spending, robust performance of industrial sector, expanding services sector, aggressive privatisation program, higher foreign direct investment, strong revenue performance, expanding trade and buoyant capital markets."

He appreciated Pakistan-World Bank Co-operation in North-South corridor development, infrastructure development and other areas.

Praful Patel appreciated the implementation of economic reforms introduced by the government, and said that according to World Bank assessment Pakistan is moving in the right direction. "World Bank assessment about the economic performance of Pakistan is positives. The country is doing well", he added.

Also present at the meeting were Dr Salman Shah, Advisor to the Prime Minister on Finance; Ms Hina Rabbani Khar, and Minister of State for Economic Affairs and senior officials.

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Government keen to enhance level of coal energy up to 9 percent
ISLAMABAD (March 15 2006): Planning Commission of Pakistan Infrastructure Advisor Dr Asad Ali Shah said on Tuesday the country wanted to enhance the level of coal energy up to 19 percent by existing six percent.

Speaking in a PTV programme, he said according to the estimates there were about 175 billion tons of coal reserves in Thar area, which could be utilised as energy generating source.

He said keeping in view the future energy requirements the government had evolved a 25 years plan with an approximate cost of dollars 150 billion. Around two third of this plan would be implemented by the private sector, he added.

Under this plan, the level of nuclear and alternative energy sources would be raised up to 5 per cent each, he said adding presently nuclear energy contributed 0.8 per cent while the share of alternative energy sources was almost nil.

To a question, he said the quality of the Thar coal was suitable for producing electricity adding in Germany similar coal was being used for energy generation.

He said the price of the oil was on constant increase in the international market with very little new discoveries.

In such a situation, the oil would be a scarce commodity in the world he said and added it was under those conditions the government was looking for alternate energy sources.

He said there was existed great potential for Pak-US co-operation in the area of energy generation, which would hopefully be utilised, in the prevailing conditions.

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Musharraf pledges to develop tribal areas
RAWALPINDI (March 16 2006): President General Pervez Musharraf on Wednesday expressed a firm commitment to establish writ of the government in tribal areas and vowed to realise rapid socio-economic development of the people.

The President was speaking at a meeting he chaired to review general security situation with particular reference to the federally administered tribal areas. In his remarks, the President appreciated the performance of law enforcement agencies and political administration in the areas vis-ÃÂ*-vis maintenance of law and order.

He emphasised on the need for continuation of processes till the enunciated objective are achieved, the writ of the government established the miscreants are brought to justice and foreign elements fomenting trouble are ousted.

On economic development of the areas, the President expressed the hope that the setting up of reconstruction zones would produce economic opportunities for the local populace.

"The economic activity will not only generate employment opportunities at grassroots level for the people but also set the pace for all-round and sustainable socio-economic progress of the region."

He said the government is committed to putting in place better health and education facilities in the areas, which will raise the quality of life and equip the youth with tools of progress and prosperity.

In this regard, the President underlined the importance of timely completion of the projects and said their effective implementation would begin a new era of development in the tribal areas and help steer the people out of backwaters of development and bring them at par with the mainstream developed areas.

Governor NWFP and Minister for Industries and Special Initiatives made presentations at the meeting.

The meeting was attended by Minister for Interior, Minister for Tourism, Minister of State for Water and Power and senior officials of law enforcement organisations.

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Concept of Pakistan emerging as energy hub widely recognised
KARACHI (March 16 2006): The concept of Pakistan emerging as the energy hub for all of Asia was widely recognised by the delegates attended the 2nd Annual Energy APAC-2006 conference held in Beijing the other day (March 13 & 14).

In a comprehensive presentation by the Sui Southern Gas Company (SSGC) Managing Director Munawar Baseer Ahmad highlighted Pakistan's comprehensive gas sector, high growth and large demand coupled with high economic growth rates matching that of China.

According to a message received here, the delegates accepted that Pakistan was ideally situated to cater to the energy and trading needs of other countries in the region, particularly the landlocked Central Asian Republics (CARs).

The SSGC MD also informed the conference about the progress on the new port of Gwadar in Balochistan, that is expected to serve as secure outlet as well as storage and transshipment hub for the Middle East and Central Asia oil and gas supplies through a well defined corridor passing through Pakistan.

Conference delegates appreciated Pakistan's position and complimented the Munawar Baseer for presenting the strategic concept of formulating a plausible solution to meet Asia's energy supply and security needs.

SSGC General Manager (IT) Zuhair Siddiqui also presented a paper portraying how SSGC had over the last three years used technology and expertise from the world's leading companies, to build its Enterprise Information System, which had provided for a transformation to excellence through effective implementation of IT for automation of various business processes and developed a company-wide culture of excellence.

He stated the SSGC now has the required proficiency to provide advisory services to other companies in Pakistan and the region on IT, as well as gas optimisation and conservation technology.

The 2nd Annual Energy APAC 2006 attracted strong sponsorship support from consulting, engineering and leading oil and gas companies. Media companies and publications were also present in force.

The avenue provided SSGC and the Pakistan delegation a vibrant forum for putting the country on the world's energy map, and presenting the concept of an interconnected and interdependent Asian energy network based on transnational pipelines from Middle East and CARs, to demand centers in Pakistan, India, China and other countries.

The proposed energy network will provide the producing companies the opportunity to supply oil and gas to user countries via multiple routes, modalities and different sources, thus ensuring energy safety, security and sustainability in the 21st century.

The conference delegates agreed to further review and develop the concept presented by Pakistan.

The SSGC delegation offered to hold a follow up discussion or workshop, where stakeholders may be invited to find solutions and develop strategies the proposed Asian energy network.

Speakers from China, Australia, United Kingdom, Germany, Holland, Singapore, India, Pakistan, Malaysia and Canada and representatives of oil / gas companies made their presentation in the Conference.

The theme of the Conference, "Creating energy solutions for the 21st century" was designed to address these concerns and look for opportunities to ensure predictable, secure and affordable access to energy resources, particularly, for the countries of Asia.

Alternative energy sources such as nuclear energy, renewable energy and natural gas, LNG and LPG also featured prominently as key discussion areas.

They covered topics such as barriers to energy security in Asia, the need to liberalise and deregulate energy trading, creation of energy partnerships, and the latest developments in oil and gas and related technology. There was focus on growing importance of LNG, renewable energy, nuclear energy as well as opportunities for foreign investments.

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Pakistan, China to discuss road projects
ISLAMABAD: Senior officials from Pakistan and China will meet in Urumqi on Monday to discuss ways to improve road transport facilities between the two countries. It will be a working-level consultation, from March 20 to 22 and will focus on how to facilitate the business community in enhancing bilateral trade.

“The two sides have recently stepped up efforts to promote trade through the land route, so it is important to further develop their road network,� official sources said on Wednesday.

The Karakorum Highway (KKH) provides an important link between the two countries and the proposals for the rehabilitation and upgrading of the KKH will also come under consideration during the forthcoming meeting, said the sources. Pakistan and China have signed a MoU for widening 600 kilometres of the KKH. According to the sources, road development transport system carries special significance when the two countries are engaged in consolidating their economic ties. The two countries have reduced tariff on a number of import and export items under the Early Harvesting Programme.

President Pervez Musharraf, during his recent visit to Beijing, told China daily in an interview that his country wants to act as a transit facility giving China access to Central Asian markets and energy sources. He was referring to the Gwadar Port through which crude oil imports from Iran and Africa could be transported to northwest China’s Xinjiang Uighur autonomous region by land.

Musharraf said that the route, on which a feasibility study was being conducted, was a shortcut compared to the one via the Straits of Malacca. The port is strategically located as it is quite near the Strait of Hormuz, through which 40 per cent of the world’s oil passes. The president said he was looking forward to the result of the feasibility study on transporting crude oil via mountainous regions in Pakistan and suggested that building a railway route was an option. APP

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WB to give $2b to upgrade rail, road networks
ISLAMABAD: The World Bank will provide $2 billion to Pakistan over the next five years for the North-South Corridor development project for modernizing rail and road infrastructure across the country to promote trade and economic activity.

Praful Patel, World Bank Vice-President for the South Asia region, said this while talking to reporters at the end of the inaugural session of the Pakistan Development Marketplace here on Wednesday.

He said the North South Corridor development is a infrastructure development and modernization project that will include development of infrastructure of roads, highways, bridges, rail links, rail system and infrastructure for future requirements of the country.

This project aims to facilitate the transportation of export cargoes from Peshawar to Karachi and making it competitive. He informed that about six months ago at a meeting with President Pervez Musharraf this North South Corridor development initiative was discussed and was agreed with the World Bank.

The project will modernize the infrastructure of the country. In the first phase, the infrastructure from Lahore to Karachi will be up-graded and modernized. He said the modernization of Pakistan Railways is also the main part of the project, under which it will be re-structured and reformed to meet the future requirements of the country. The demand is there, but the railway system is 50 years old that need up-gradation.

The World Bank will provide $2 billion for North South Corridor development project over the next five years to help the country to modernize its infrastructure. He said the amount for re-structuring and reforming the railways for future requirements is to be decided in consultation with the local authorities.

Responding to another question, he said inflation is in the range of 8% and the government is taking steps to bring it down to a reasonable level. He said the World Bank Portfolio review will be held on Thursday between the Bank authorities and Adviser to the Prime Minister on Finance and Revenues Dr Salman Shah.

A special task force on the North South Corridor has already suggested to the government to rationalize taxes and duties on the import of modern multi-axle trucks with a view to improving the operational efficiency and modernization of trucking fleet in the country.

The task force had highlighted in its report that Pakistan’s highway infrastructure is under multiple overload stress that is reducing its life to less than half. Annual maintenance and rehabilitation bill is touching staggering proportions, causing road sector inefficiency loss of Rs 240 billion per year, as per the World Bank Report 2002. Highways with 10-year design life becomes unserviceable in only 18 months (on an average) and is to be rehabilitated five times during the 10-year design period.

The ministry of communications keeping in view the recommendations of the task force has proposed to the government that under the deletion programme condition the import of CKD trucks be allowed on 0% customs duty and 15% general sales tax against the existing rate of 20% customs duty and 15% general sales tax.

The ministry has also suggested to the government that import of trucks in CBU condition without deletion programme is allowed on 10% customs duty and 15% general sales tax against the existing rates 60% customs duty and 15% general sales tax so that the future requirement of trade and industry can be met through a modern fleet of trucks in the country. The government is expected to approve and announce some of the recommendations of the task force in the budget for the fiscal 2006-07.

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China to expand investment in Pakistan
ISLAMABAD (March 17 2006): Chinese government encourages its public and private sectors to actively take part in projects based in Pakistan and the objective of this visit is to strengthen co-operation between the corporate entities of the two countries in the manufacturing sector.

These views were expressed by Liu Yingjun, Deputy Director General of the Ministry of Commerce of China currently visiting Pakistan at the head of a 6-member delegation during a meeting in Board of Investment (BoI).

Jehangir Bashar, Secretary Board of Investment briefing the delegation about the economic and investment policies of the government said that Pakistan provides the most friendly environment to the foreign investors which is evident from the fact that over 600 multi-nationals are operating in Pakistan and not a single company, which came to Pakistan has gone back.

Bashar pointed out that unfortunately despite the time tested friendship on the political and diplomatic front, economic co-operation between the two countries remained insignificant. The inking of number of agreements during the recent visit of the President of Pakistan to Chine, he hoped, would boost bilateral trade in various fields and enhance economic ties of the two countries also.

He said that as China is now looking for expanding its investments abroad, given the geographical location, cheaper cost of production, economic reforms, liberal investment policies, abundant human resource and above all a local market of 150 million people, Pakistan is an ideal place for China to invest in.

Liu Yingjun expressing her gratitude on the supportive role of the Government of Pakistan, pointed out that the Chinese companies established in Pakistan were greatly facilitated by the government especially Board of Investment (BoI) and this has encouraged more Chinese companies to consider investment in Pakistan

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'All NWFP villages to be electrified by 2007'
PESHAWAR (March 18 2006): Under the Roshan Pakistan Programme of the federal government, the Peshawar Electricity Supply Company (Pesco) would electrify all villages of NWFP by end of year 2007.

Pesco Chief Executive Brigadier Sakhi Marjan announced this during a 33rd Board of Directors meeting of the company held under the chairmanship of Jamshed Savul at Wapda House, Peshawar.

Pesco Chief Executive Brigadier Sakhi Marjan, Dr Mir Hatim, Ahmed Nawaz Mughal, Chaudhry Abdul Qadeer, Ghulam Hussain Kulachi, members, Chief Engineer (Operation) Muhammad Shafiq Khattak, Chief Engineer (Technical) Roshan Din, Chief Engineer (Customer Services) Iqbal Ali Shah and Riaz Hussain, Secretary Board of Directors, attended the meeting.

Riaz Hussain, Secretary Board of Directors presented a comprehensive report about the minutes of the 32nd Board of Directors meeting, which were approved with minor amendments after a detailed discussion.

Pesco Chief Executive Brigadier Sakhi Marjan briefed the BoD regarding ongoing developmental schemes of electricity running under various programmes. He told the meeting that the government had chalked out its policy to electrify all villages in the country by December 2007.

The Pesco is taking all out efforts for implementation of the government directives and electrification work of all villages of NWFP is underway throughout the province.

He said that 3648 villages had been electrified from July 1, 2004 to February 28, 2006, with a cost of Rs 1204 million while work to electrify more villages is under progress.

The Pesco has prepared a detailed plan for electrification of all villages in the NWFP province by the end of December 2007, out of which 1191 villages would be electrified with a cost of Rs 631.9 million by December 2006, while remaining villages to be electrified by December 2007.

The board directed to complete the electrification of all villages of the province within stipulated time and directed to utilise all the available funds in this regard. The board stressed to ensure the availability of required material on sites for the developmental schemes. It called for the presentation of report on village electrification in the next meeting of the board.

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Asian Bank pledges $130 million for Balochistan
ISLAMABAD (March 17 2006): The Asian Development Bank (ADB) has agreed to provide $130 million loan from its Ordinary Capital Resources (OCR) for Balochistan Devolved Social Services (BDSS) programme to help achieve Millennium Development Goals (MDGs). The loan is for 15 years, including a grace period of three years. The Program is to be implemented during 2006-09.

Sources told Business Recorder on Thursday that last year, a high-powered ADB mission visited Pakistan, and discussed modalities of the project with representatives of the Planning and Development Department of Balochistan (executing agency), Planning and Development Division and Economic Affairs Division (EAD).


In July 2004, the bank had approved $0.40 million for project preparation now the government is seeking funds to execute the project, sources added.


This programme aims at expanding the coverage of health services, especially for women and children, increasing school enrolment, improving educational facilities for handicapped children (girls) and improving water supply and sanitation services. It will also support institutional strengthening and partnership building to deliver social services effectively in Balochistan.


The project will also execute social sector performance grants to the districts; support capacity building and institutional strength at both provincial and district levels in social service delivery; enable the private sector to participate in public and private social sector services delivery. It will also provide policy reform support for province-wide devolved social services in education, health and water supply and sanitation. The Planning and Development Department of Balochistan shall be the program-executing agency. The beneficiary shall pay to ADB an interest charge at the rate of one percent per annum during the grace period and 1.5 percent per annum thereafter.

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India, Pakistan trade almost doubles to one billion dollars: industry group
NEW DELHI (updated on: March 19, 2006, 13:48 PST): Trade between India and Pakistan almost doubled to cross the one billion dollar mark this year, an industry body said.

The 400 million dollar increase in the year to March 2006 was attributed to the launch of a South Asian Free Trade Area Agreement (SAFTA) and the opening of rail and road links last year, the Associated Chambers of Commerce and Industry said in a statement.

"The establishment of relations along with SAFTA has brought changes in customs tariffs and reduced trade-related barriers, leading to restoration of direct trade linkages and reducing the transaction costs," said the statement quoted by the Press Trust of India news agency. India and Pakistan launched a peace process in January 2004.

After the start of the peace talks Pakistan scrapped import duties on 13 commodities from India that were scarce in its local markets including garlic, onions, potatoes, tomatoes and livestock.

India last year imported onions from Pakistan to make up for a domestic shortfall.

Bilateral trade, which stood at 161 million dollars almost five years ago, has the potential to reach 10 billion dollars by 2010, the industry body added.

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2007 to be celebrated as 'Visit Pakistan Year
PESHAWAR, Matrch.19 Federal Minister for Tourism Dr Ghazi Gulab Jamal said that 2007 would be celebrated as "Visit Pakistan Year" to attract tourists and promote the tourism industry of the country.

Talking to news agency he said the ministry had planned a number of events to further boost and attract domestic as well as international tourists to visit and explore the inspiring tourism sites of the country.

He said Pakistan was gifted with rich cultural and natural beauty, which is a great source of inspiration for the foreign tourist to visit and explore it.

The minister said, as tourism has become an industry it needs more attention towards its promotion to make it a productive tool in the development of national economy.

The minister underscored the role of local community in improving the industry by extending visitors maximum care and love.

Establishing skiing resort in the northern areas, Ghandara week and

Sufi festivals were the major events planned to attract local and foreign tourists, he added.

The minister further said that the opening of the route that Alexander the Great used during his invasion of sub-continent is also under consideration.