Yaaree Sort of ‘Business & Finance’ Category



The central bank pumped in Rs325.00bn into the banking system on Sept 08, in the open market operation. The injection was made in a one day contract at 5.80pc. The central bank had received bids worth Rs341.50bn.

According to the weekly statement of position of all scheduled banks for the week ended Aug 19, deposits and other accounts of all scheduled banks stood at Rs10,165.79bn after a 0.41pc fall over the preceding week’s figure of Rs10,207.59bn. Compared with last year’s corresponding figure of Rs9,020.41bn, the current week’s figure was higher by 12.70pc.

Deposits and other accounts of all commercial banks stood at Rs10,109.37bn against preceding week’s deposits of Rs10,151.25bn, showing a decrease of 0.41pc. Deposits and other accounts of specialised banks stood at Rs56.43bn, up 0.20pc against previous week’s figure of Rs56.31bn.

Bank borrowing rose by 21.43pc against the previous week

Total assets of all scheduled banks stood at Rs13,891.38bn, higher by 1.93pc over preceding week’s figure of Rs13,627.94bn. Current week’s figure is higher by 9.55pc compared to last year’s corresponding figure of Rs12,679.83bn.

Total assets of all commercial banks stood at Rs13,666.16bn, higher by 1.96pc over previous week’s figure of Rs13,403.46bn, while total assets of specialised banks at Rs225.23bn, were higher 0.33pc over the previous week’sRs224.48bn.

Gross advances of all scheduled banks stood at Rs5,040.71bn, smaller by 0.13pc over the preceding week’s figure of 5,047.52bn. Compared with last year’s corresponding figure of Rs4,566.00bn, current week’s figure is higher by 10.40pc.

Advances by all commercial banks fell to Rs4,877.07bn from previous week’s Rs4,884.05bn indicating a fall of 0.15pc, whereas advances of specialised banks stood at Rs163.63bn against previous week’s 163.47bn.

Borrowings by all scheduled banks increased in the week under review. It rose by 21.43pc to Rs1,742.68bn against previous week’s Rs1,435.13bn. Compared to last year’s corresponding figure of Rs1,696.38bn, current week’s figure is larger by 2.73pc.

Borrowings by commercial banks in the week at Rs1,665.24bn were higher by 22.58pc against previous week’s Rs1,358.52bn. Borrowings by specialised banks stood at Rs77.44bn against the previous week’s Rs76.61bn.

Investments of all scheduled banks stood at Rs7,114.16bn against preceding week’s figure of Rs6,962.69bn, showing a rise of 2.18pc. Compared to last year’s corresponding figure of Rs6,293.03bn, current week’s figure is higher by 13.05pc.

Chart by Rehan Ahmed
Chart by Rehan Ahmed

Investments by all commercial banks stood at Rs7,071.73bn, higher by 2.20pc against preceding week’s figure of Rs6,919.64bn, whereas investment by all specialised banks stood at Rs42.44bn against preceding week’s figure of Rs43.05bn.

Cash and balances with treasury banks of all scheduled banks increased over the week and stood at Rs8,26.51bn against previous week’s Rs758.18bn, showing an increase of 9.01pc. Current week’s figure increased by 13.16pc compared to last year’s corresponding figure of Rs730.38bn.

Cash and balances of all commercial banks stood at Rs823.76bn, higher by 9.12pc over previous week’s Rs754.94bn. Cash and balances of all specialised banks were smaller by 15.04pc at Rs2.75bn against the preceding week’s Rs3.24bn.

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The Pakistan State Oil (PSO) on Thursday denied any imminent fuel shortage in the country and assured smooth transition to new fuels in due course of time.

“Pakistan State Oil refutes the impression that is being created by some circles that there will be shortage of fuel in the country in the next few days owing to the decision of the government to import higher grades of Mogas and compliance of the same by all Oil Marketing Companies (OMCs),” said a statement released by the national oil company.

The statement added that as opposed to the claims made; the company has sufficient quantities of Mogas and assures the public that there will be no shortage of fuel for its customers at PSO outlets across the nation.

“PSO does not operate on short term gains or minimise its stocks and will continue to honour its commitment of fuelling the nation under all circumstances irrespective of commercial benefit to itself as our topmost priority and commitment is to keep the wheels of the country running.”

High Octane Blending Content (HOBC) sold in Pakistan is RON 97. The local refineries, except for Attock RON 87, will be producing RON 90 petrol from the beginning of November 2016 as well, the statement added.

The policy steps taken are a paradigm shift for Pakistan’s oil industry and provision of clean fuels will assist the climate change plans of the country.

PSO assured the people of Pakistan that the transition to new improved quality fuels will be a smooth one, it was further pointed out.

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There are two elements for small businesses’ security: firstly, information technology (IT) security, and secondly, physical security. Securing IT infrastructure in Pakistan is quite easy.

Off-the-shelf systems and even capable vendors are readily available. However, what’s important to understand is how your online presence impacts your physical security.

Continue Reading…

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THE textile industry is in a dilemma as cotton trade between Pakistan and India has been hit by a rise in border tension; and traders across the border, being uncertain of future developments, are not entering into new deals.

Pakistan’s Cotton Commissioner Khalid Abdullah says a low quantum of trade activity is still taking place. The government has not asked importers to stop buying cotton from India but many of them are not buying on their own as a gesture of national solidarity. However, Indian exporters are refusing to sell at their government’s behest although they would be the losers.

Pakistani spinners are the biggest buyers of Indian fibre. Fewer imports by Pakistan this year could hurt Indian exports, raise their prices and help rival cotton exporters like Brazil, the United States and some African countries. For Pakistan’s industry, buying the raw material from other sources may prove costly owing to long distance freight. In fact, the situation is in a wait-and see mode. Cotton trade between the two countries is worth $822m a year.

Pakistan’s Cotton Commissioner Khalid Abdullah says a low quantum of cotton trade activity is still taking place

Another victim of high political temperature is vegetables. According to Times of India, traders from the Indian state of Gujarat have decided to stop supplying vegetables to Pakistan.

Gujarat used to send 50 trucks having 10 tonnes of vegetables, mainly tomatoes and chilli, to Pakistan via the Wagah border. This is the first time in almost two decades that Gujarat’s exporters have halted the supply of essential vegetables to Pakistan. The commission agents say they will not resume exports till the normalisation of relations.

The suspension in cotton trade comes at a time when Pakistan’s cotton crop has recorded an overall decrease of 15pc over the last year, adding to the industry’s woes. Pakistan, the world’s third-largest cotton consumer, starts importing from September, but this time there has been little activity so far.

In the 2015-16 fiscal year ending on March 31 in India, official trade between the two was $2.6bn with cotton being a major component. However, in the crop year that ended on September 30, Pakistan was India’s biggest cotton buyer after its own crop was hit by drought and whitefly pest. According to an estimate, Pakistan will need to import at least three million bales in 2016-17.

The Cotton Crop Assessment Committee (CCAC), on Oct 7, estimated that the output for 2016-17 stood at 11.039m bales.Participants were informed that the lower output was mainly due to effects of climate change on the crop, besides pests like pink bollworm and whitefly. The crop output in Punjab is estimated at 7.3m bales, with each bale weighing 170 kilograms.The crop size of Sindh is estimated at 3.7m bales.

The representative of growers from Punjab agreed to the assessment whereas the Pakistan Cotton Ginners Association chairman was of the opinion that the crop size in Punjab was about 7.5-8m bales. Cotton sowing has registered a decrease of 21pc in Punjab while it has risen by 2pc in Sindh. The crop size is assessed on the basis of data provided by provincial governments.

Meanwhile, Afghan President’s special envoy and Ambassador to Pakistan, Dr Omar Zakhilwal, has refuted reports that Kabul has shut down the land route for Pakistani trucks going to Central Asian states through its territory. Ashraf Ghani had threatened, last month, to shut Pakistan’s transit route to Central Asian countries if it did not allow Afghan traders to use the Wagah border for trade with India. Pakistani trucks, the envoy says, can deliver transit goods directly to Uzbekistan, Tajikistan and Turkmenistan via Afghanistan.

It is interesting to note that in a highly charged political atmosphere, trade in other commodity goods has not been affected. The inward flow of Indian goods into Karachi’s major commodity and grocery markets, in old city areas which form the hub of the country’s wholesale trade, continues uninterrupted without any increase in prices or shortage of goods.

Shopkeepers selling Indian cosmetics and jewellery are doing business as usual because of their smooth flow and easy availability. The war-like situation has not affected their business. Not only is the arrival of goods from India normal, even exports are taking place at the usual pace. Pulses, spices and dried fruits continue to land in Pakistan, with these items not having faced any shortage in the wholesale market so far.

Trade balance between the two countries is in favour of India. In 2015-2016, exports from Pakistan to India dropped to $400m from $415m in 2014-2015. India’s exports to Pakistan surged 27pc to $1.8bn over the same period.

The All Pakistan Textile Mills Association (APTMA) Punjab Chairman Aamir Fayyaz says that since now the textile industry has become highly dependent on imported cotton, duties and taxes on import of cotton would make the entire value chain uncompetitive. The situation calls for the withdrawal of 4pc customs duty and 5pc sales tax on the import of cotton. He wants the government to resolve the textile industry’s issues and enable it to undertake investment worth $1bn per annum.

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ISLAMABAD: The Executive Committee of the National Economic Council (Ecnec) on Friday approved six development projects worth Rs281 billion, including import of 58 locomotives, Gwadar-Nawabshah gas pipeline and a terminal at Gwadar for handling imported liquefied natural gas (LNG).

All these projects will have combined foreign financing of about Rs164bn.

In a meeting presided over by Finance Minister Ishaq Dar, the country’s highest development project approval authority approved Gwadar-Nawabshah LNG terminal and pipeline project at a cost of Rs203.314bn including foreign exchange Chinese loan of Rs135.128bn. The project was previously approved by the Economic Coordination Committee (ECC) of the Cabinet in 2014 for completion in November 2015. But it has now been delayed until 2018 due to internal issues of the petroleum ministry and the agencies concerned.

“The project is expected to complete in two years (2016-18),” confirmed a statement issued by the finance ministry. The project aims to overcome the shortage of natural gas supply by importing LNG at Gwadar and then transmit it to Nawabshah through a 700-kilomtere pipeline having a diameter of 42 inches.

The government has already decided to award the contract for the project to a Chinese firm — China Petroleum Pipeline Bureau — on a build-own-and-operate basis for which Export-Import Bank of China would provide a commercial loan of about $1.35bn.

The pipeline would also facilitate Iran-Pakistan pipeline project. The terminal will have the capacity to handle up to 600 million cubic feet per day (mmcfd) of gas.

Ecnec also allowed the Ministry of Railways to procure 58 diesel electric locomotives at a revised cost of Rs16.3bn, including a foreign loan of Rs11.755bn. The procurement will be completed by December. The proposed locos will replace 50 over-aged locomotives and will be used to haul freight and passenger services along with high-capacity wagons fitted with air brakes and roller bearing. The capacity of Pakistan Railways is expected to improve after the project’s completion.

The meeting also approved package-III of Balochistan’s irrigation department project for construction of 20 small dams in different districts of the province at a cost of Rs7.83bn.

The project is targeted for completion in three years to help the province harness flood flows and supply about 175,500 acre-feet of conserved flood water for direct irrigation and drinking purposes. It is expected to benefit about 58,500 acres of fertile cultivable land and save the land from flood damages and create jobs.

Ecnec directed the Planning Commission to set up a monitoring committee to make sure that the project was completed in three years. This committee will also have a member from the Ministry of Water and Power to look after the implementation.

The meeting also approved Southern Punjab Poverty Alleviation Project ) at a total cost of Rs4.658bn, including Rs4.14bn international soft loan from the International Fund for Agricultural Development (IFAD). It will help improve the standard of life in four less-developed districts of Punjab, ie Bahawalpur, Bahawalnagar, Muzaffargarh and Rajanpur.

The IFAD has helped in the financing of the project through a soft loan of $40.13m. The project will help reduce poverty in the areas of Southern Punjab by generating more income, increasing agricultural productivity, improving livelihood opportunities, providing vocational training, especially to women, and building physical infrastructure to improve the quality of life. The project is expected to complete in 2017.

The meeting also cleared the 106-megawatt Golan Gol Hydropower project in Chitral, Khyber Pakhtunkhwa, at a cost of Rs29.077bn, including foreign exchange component of Rs10.68bn. The project would generate an annual energy of about 436 gigawatt hours. The project will be connected with the national grid with a 198km transmission line from Golan Gol to Timurgarha passing over Lowari pass and then reaching Chakdara.

Ecnec also approved a project of Peshawar Electric Supply Company to construct 7th secondary transmission line and grid stations at a cost of Rs20bn, including foreign loan of Rs1.92bn. The project will be completed in five years.

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If you’re reading this, then I congratulate you. To even consider early retirement, you need to know the value of figuring out how much money you need to be happy, spending less than you earn, and investing the difference. The problem, however, is that once you save up enough money in a tax-advantaged retirement account, you have to wait until you’re nearly 60 to start withdrawing that money tax-free.

Well, I have good news for you. If you’ve learned to live a frugal life, then there’s something even better than a Roth IRA, and it’s been hiding under our noses all along: a plain old brokerage account — with absolutely no tax advantages to speak of.

Did you ever notice this before considering early retirement?

In 2014, I was doing some research on capital gains taxes when I noticed something I’d never seen before:

Screen Shot

© Provided by Fool Screen Shot

I was astounded. If — after adding together all of your sources of income — your household is in or below the 15% tax bracket, you pay absolutely no taxes on capital gains. “Sure,” you might say, “but only the uber-poor are in those tax brackets.”

That’s not quite true. Here’s the adjusted gross income limit that would put you in that tax bracket.

Single $37,650
Married, Jointly $75,300
Head of Household $50,400

Data source: The Tax Foundation. 

Consider how high these levels really are. The median household income in America sits at $55,500. If that household has a married couple filing jointly, they fall below the 15% tax threshold.

What this means for early retirees

Let’s consider a couple that’s 50 years old. They’ve been putting money away in their 401(k)s and traditional IRAs for their entire working lives. That has allowed them to build up a substantial nest egg — say $600,000.

But because they lived a disciplined lifestyle that eschewed things like buying as much house as they could afford, driving brand-new cars, and sending their kids to the most expensive colleges on Earth, they can live comfortably on $40,000 per year now that the kids are gone.

The couple knows that once they are 62, they’ll be able to have all of their needs met by a combination of Social Security and their nest egg. They’ll also be able to start getting that money from retirement accounts starting at age 59-1/2 years old. They just need to bridge the gap between when they retire and when they can tap those sources of income.

They did this by investing any leftover money they had — after contributing to their 401(k) and IRA — in a regular brokerage account. They bought stocks of solid companies with durable competitive advantages and, in many cases, dividends. In some years they’d have to pay taxes on those dividends while they were working, but not in all years.

While the couple was well aware of the 4% rule for safe withdrawals, they were comfortable taking out 8% in the first year, given that they only needed their nest egg to last about a decade, rather than all of retirement. That means over the years they’ve built up a normal brokerage account worth $500,000.

Once they quit their jobs, they’ll get the requisite $40,000 in annual income by collecting dividend payments and selling some stocks — and they’ll never pay taxes on any of it.

Practical applications for you and me

To be frank, some of these figures seem fantastical. I would love to believe that I’ll have $600,000 in retirement accounts and another $500,000 in a brokerage account when I’m 50. But I probably won’t find myself there — and that’s OK.

I still use this knowledge to my advantage. Every year, after our bills are paid, we contribute to a traditional IRA instead of a Roth. We prefer the tax reduction right now, because we know that any excess cash we might have can simply be put into a regular brokerage account that’s as good as a Roth, so long as we keep an eye on how much we’re earning and when we sell certain stocks.

If you have the time, this is an easy approach that will give you much more flexibility when early retirement comes knocking at your door.

If you’re like most Americans, you’re a few years (or more) behind on your retirement savings. But a handful of little-known “Social Security secrets” could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $15,834 more… each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we’re all after.

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ISLAMABAD: The Oil and Gas Regulatory Authority (Ogra) on Thursday suggested no change in the prices of petrol and diesel for October.

However, it worked out increase in the prices of almost all other petroleum products that are not in common use.

In its working paper, Ogra based on existing high tax rates calculated just a 10 paisa per litre increase in the price of petrol and a 28 paisa per litre reduction in the price of high speed diesel for the next month. Therefore, it wanted a no change in the prices of both products.

Ogra forwarded its working paper to government on the basis of existing tax rates under instructions from Finance Minister Ishaq Dar. A final decision about the adjustment in oil prices would be announced on Friday.

Petrol, diesel prices kept unchanged

Based on existing tax rates and PSO purchases from international market, Ogra worked out the ex-depot price of petrol at Rs64.37 per litre for next month instead of Rs64.27, an increase of 0.2pc. The regulator estimated the ex-depot sale price of HSD to go down by 0.28 paisa or 0.4pc to Rs72.13 instead of Rs72.52 per litre.

On the other hand, Ogra calculated the price of high octane blending component at Rs76.13 per litre instead of Rs72.58 per litre, an increase of Rs3.55 per litre or 4.9pc. It also recommended ex-depot price of kerosene to increase by R2.71 per litre (6.3pc) to Rs45.96 per litre from Rs43.25. Likewise, it worked out ex-depot price of light diesel oil at Rs42.15 per litre instead of Rs43.42, up Rs1.81 or 4.2pc.

Also, it suggested 4.1pc increase in the price of jet petrol (JP-1) to Rs42.19 per litre instead of Rs40.52.

Currently, the government is collecting about Rs25 per litre taxes on petrol in the form a fixed sales tax and petroleum development levy. Similarly, it is collecting about Rs35 per litre taxes on high-speed diesel (HSD).

Petrol and HSD are the two major products that generate most of revenue in oil sector. The HSD sales are average 600,000 tonnes per month against monthly consumption of around 400,000 tonnes of petrol while kerosene sales are less than 10,000 tonnes per month and that of HOBC less than 6,000 tonnes per month on average.

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