PAR News - Fri, 29 Mar 2024

TOPLINE

• The Ministry of Commerce (MoC) has authorized the export of wheat flour produced from imported wheat exclusively for export under the Export Facilitation Scheme.
• On Thursday, the local gold market surged as global bullion prices rose, with gold reaching Rs 231,000 per tola and Rs 198,045 per 10 grams. The global bullion value closed at $2214 per ounce.
• Nepra has approved a Rs 85.275 billion quarterly tariff adjustment (QTA) for the 2nd quarter of FY 2023-24, impacting consumers by Rs 2.7492/kWh due to various factors. The existing Rs 4.43/kWh adjustments will cease from March 30, 2024, ending the current billing structure which includes two quarterly adjustments.
• The Punjab government will provide 56 types of subsidized agricultural machinery to farmers. Additionally, a program to concrete water channels across Punjab to prevent irrigation water wastage was approved with two phases for completion.
• A moderate 5.3 magnitude earthquake struck Islamabad and parts of Khyber Pakhtunkhwa province, including Rawalpindi and Peshawar, with no casualties or damages reported.
• Ukraine launched a sophisticated air and naval attack on Sevastopol, damaging ships and infrastructure, followed by a devastating missile strike targeting Russian military assets.

COMMODITIES - CROPS, LIVESTOCK & HORTICULTURE

• Wheat Flour Export Authorization: The Ministry of Commerce (MoC) has authorized the export of wheat flour produced from imported wheat exclusively for export under the Export Facilitation Scheme, 2021, as per Statutory Regulatory Order (SRO) 433(1) 2024. This amendment to the Export Policy Order, 2022, allows the export of wheat flour made from wheat imported solely for export under the scheme. [BR] [ET]
• Maple Leaf Acquires Agritech Shares: Maple Leaf Cement Factory Limited (MLCF) has acquired and settled 6,000,000 voting shares of M/s Agritech Limited, bringing the total aggregate shareholding, including Maple Leaf Capital Limited, to 11.38 percent in the target company, as per a notice sent to the Pakistan Stock Exchange on Thursday. [BR]
• PFA Seizes Substandard Cooking Oil & Ghee: The Punjab Food Authority (PFA) intercepted an attempt to distribute substandard cooking oil and ghee from popular brands during a factory raid. PFA Director General Muhammad Asim Javaid reported the confiscation of 9,000kg of substandard ghee, 8,000 liters of unhygienic oil, along with equipment and packaging materials. [BR]
• Local Gold Market Surges on Global Price Rise: On Thursday, the local gold market surged as global bullion prices rose, with gold reaching Rs 231,000 per tola and Rs 198,045 per 10 grams. The global bullion value closed at $2214 per ounce, up by $14, while silver remained stable at Rs 2580 per tola and Rs 2211.93 per 10 grams, in line with its global value of $24.55 per ounce. [BR]
• Intercropping for Sindh's Sustainability: Progressive growers and agriculture experts are advocating for the promotion of intercropping in Sindh to address water scarcity and enhance food security. Intercropping, a traditional farming method involving the simultaneous cultivation of multiple crops in the same field, has been underutilized due to resistance from landlords with vested interests. [ET]

AGRI-INPUTS, WEATHER, WATER & POWER

• Nepra's Q2 Tariff Adjustment: Nepra has approved a Rs 85.275 billion quarterly tariff adjustment (QTA) for the 2nd quarter of FY 2023-24, impacting consumers by Rs 2.7492/kWh due to various factors. The existing Rs 4.43/kWh adjustments will cease from March 30, 2024, ending the current billing structure which includes two quarterly adjustments, with the last adjustments for FY 2022-23 and FY 2023-24 expiring by the end of March 2024. [BR] [Dawn] [ET]
• Nepra Urges Electricity Tariff Review: Nepra advised the government on Thursday to review the electricity tariff structure to boost business activities, following discussions on factors like higher tariffs, increased FCAs, lower industrial growth affecting electricity demand, and system constraints during a public hearing on CPPA-G's FCA adjustment request for February 2024. [BR]
• Indus River Water Quality: The Water and Sanitation Agency's test reports on the Indus River water quality showed an increase in total dissolved solids (TDS) attributed to discharges from Manchar Lake. Wasa, after purifying the water at its lagoons, supplies it to Hyderabad city, but faces water shortage issues in parts of the city due to the stoppage of lake discharges, prompting actions to mitigate the effects of the "toxic water spillage" into its lagoons. [Dawn]
• Sindh High Court Upholds Gas Tariff Increase: The Sindh High Court deemed the gas tariff increase lawful as per Ogra's 23.10.2020 notification and directed the encashment of deposited security to pay the gas company. It affirmed that industrial gas connections used for self-generated electricity are classified as Captive Power Plants under the Nepra Act's amended definition. [BR]
• BYD Partners with Mega Conglomerate for Pakistan Entry: BYD, a leading new energy vehicle manufacturer, will enter Pakistan's passenger vehicle market in partnership with Mega Conglomerate Pvt. Ltd. This was announced during BYD's Asia Pacific dealer conference in Xi’an, China, aiming to accelerate Pakistan's automotive industry electrification. [The News]
• Punjab Government Initiatives for Farmers: The Punjab government, chaired by Chief Minister Maryam Nawaz, will provide 56 types of subsidized agricultural machinery to farmers. Additionally, a program to concrete water channels across Punjab to prevent irrigation water wastage was approved, with 1,200 channels in the first phase costing Rs 10 billion, and 7,000 channels in the second phase. [BR]
• Moderate Quake Shakes Islamabad: A moderate 5.3 magnitude earthquake struck Islamabad and parts of Khyber Pakhtunkhwa province, including Rawalpindi and Peshawar, with no casualties or damages reported. The quake originated from the Afghan-Tajikistan border area, as confirmed by the Meteorological Department. [Dawn]

AGRI UPDATES & PAKISTAN POLICY

• Prime Minister Revamps Council of Common Interests: Prime Minister Shehbaz Sharif has revamped the Council of Common Interests (CCI), excluding Finance Minister Muhammad Aurangzeb and adding Foreign Minister Ishaq Dar. The new CCI, effective from March 21, 2024, includes eight members, including the Prime Minister, Chief Ministers, and other ministers. [BR]
• FY 2023-24 Q2 GDP Growth Slows to 1%: FY 2023-24's 2nd quarter GDP growth was one percent, down from 2.50 percent in Q1 and 2.20 percent in the same quarter last fiscal year. The National Accounts Committee (NAC) reviewed the quarterly GDP estimates, introducing Quarterly National Accounts (QNA) for more frequent economic updates. [BR] [ET]
• Pakistan's Forex Reserves Increase: The State Bank of Pakistan's foreign exchange reserves rose by $4 million in a week, reaching $8.021 billion by March 22, 2024. While the source of the inflow wasn't disclosed, interbank dealers suggest the central bank purchased dollars. Overall, the country's reserves, including commercial banks' holdings, stood at $13.427 billion, with commercial banks holding $5.405 billion. [Dawn]
• Pakistan Sticks to Trade Suspension with India: Pakistan's Foreign Office stated that its position on suspending trade ties with India since August 5, 2019, due to what it deems as illegal actions in Kashmir, remains unchanged. It will consider a proposal from the business community seeking to reopen bilateral trade, but emphasizes that trade relations with India have been non-existent since 2019. [BR]
• Pakistan, IMF to Discuss Privatisation at Spring Meetings: Privatization discussions between Pakistan's economic team and the IMF may occur during the IMF-World Bank spring meetings from April 15th to 20th. The Privatisation Commission spokesperson noted no talks with the IMF during the recent Stand-By Arrangement review. The meetings aim to address global economic concerns and aid effectiveness. [BR]

INTERNATIONAL – OVERVIEW & MARKET OUTLOOK

• Ukraine Strikes Sevastopol: Devastating Blow - Ukraine launched a sophisticated air and naval attack on Sevastopol, damaging ships and infrastructure, followed by a devastating missile strike targeting Russian military assets, including communication centers and landing ships, severely weakening Russia's Black Sea Fleet. [AL Jazeera] [ET]
• Reliance Industries Shuns Russian Oil Amid US Sanctions: India's Reliance Industries, owner of the world's largest refinery, won't buy Russian oil shipped by Sovcomflot due to US sanctions, further complicating Russia's oil export issues. Recent Ukrainian drone attacks on Russian refineries have worsened the situation, making it harder for Russian firms to sell oil and collect payments amid banking restrictions. [BR]
• Iran Police Chief Sentenced to Death: An Iranian court has sentenced police chief Jafar Javanmardi to death for killing a protester during the 2022 mass protests following the death of Mahsa Amini, who died in custody for violating Iran's strict dress code. Javanmardi was arrested in December 2022 in relation to the killing during the widespread demonstrations after Amini's death in September of the same year. [BR]
• Nissan, Honda Mull Electric Vehicle Partnership: Nissan and Honda are considering a strategic partnership in electric vehicles to adapt to industry changes. This move aims to catch up with Chinese competitors leading in EVs, while Nissan CEO Makoto Uchida highlights the need to compete with both traditional and new players, citing innovative products and competitive pricing as key factors. [BR]
• Oil Prices Rebound on OPEC+ Cuts Expectation: Oil prices rose over $1 a barrel on Thursday, rebounding after two consecutive sessions of decline, as investors anticipated tighter supplies with the OPEC+ producer alliance expected to maintain current production cuts. Brent crude futures for May increased by $1.21 to $87.30 a barrel, while WTI crude futures for May delivery surged by $1.28 to $82.63 a barrel. [BR] [Dawn]

PAKISTAN - REMAINDERS

• PM Shehbaz Forms Commercial Transactions Committee: Prime Minister Shehbaz Sharif has formed the Cabinet Committee on Intergovernmental Commercial Transactions (CCoIGCT), with a notification issued by the Cabinet Division on March 28, 2024. The committee, headed by the Minister for Defence, will include members from the Finance, Economic Affairs Division, Privatization, and Petroleum ministries. [BR]
• Opinion: Possible Need for Price Controls - “It is suggested that a ‘price commission’ is formulated at the earliest so that over-pricing and over-profiteering are checked, especially for goods and services of significant importance for the economy overall. Moreover, the proposed commission may underscore or explain the criticality of price controls.” - By Dr Omer Javed [BR]