PAR News Bulletin - Fri, 5 August, 2022

TOPLINE

• A 17.2% increase was witnessed in the country’s service exports during FY22.
• Torrential rains in Balochistan’s Makran belt have severely affected date fruits too, causing an estimated Rs 2 billion loss to farmers.
• Pursuing a revenue target of Rs 121 billion for the current financial year, WAPDA has requested NEPRA to increase the tariff of hydroelectric power by Rs 0.47 per unit.
• Sindh Minister for Health and Population Welfare has said that waterborne diseases, especially cholera and diarrhea, have been on the rise due to the contamination of water following the heavy monsoon rains in the province.
• The Pakistan Sugar Mills Association (PSMA) expects surplus production next season and demanded a timely decision of allowing export of surplus sugar.
• Southeast Asian foreign ministers urged restraint Thursday as China launched military drills off Taiwan, warning the situation risked spiraling into “open conflicts”. US House Speaker Nancy Pelosi arrived in Japan on Thursday for the final stop on her Asian tour, following a visit to Taiwan that incensed China.
• Britain will sink into a lengthy recession later this year as inflation rockets even higher, the Bank of England forecast on Thursday as it unveiled the biggest interest rate hike since 1995.

COMMODITIES - CROPS, LIVESTOCK & HORTICULTURE

• Cotton Market: On Thursday, the spot rate decreased by Rs 1,000 per maund and closed at Rs 17,500 per maund. The rate of cotton in Sindh is in between Rs 15,200 to Rs 15,400 per maund. The rate of cotton in Punjab is in between Rs 17,000 to Rs 17,500 per maund, and in Sindh is in between Rs 6,000 to Rs 7,000 per 40 kg, and in Punjab is in between Rs 7,500 to Rs 8,500 per 40 kg. The rate of cotton in Balochistan is in between Rs 15,500 to Rs 16,000 per maund. [BR]
• Rupee Appreciates: The rupee, which has been on an upward trend for more than a week now, continued strengthening against the dollar in the interbank market on Friday. The local currency gained Rs2.11, or 0.94 per cent, against the dollar to close at Rs224.04. [BR] [Dawn] [ET] [The News] [Dawn] [Dawn]
• Dates Farmers Suffer: Like human settlements and infrastructure, torrential rains in Balochistan’s Mekran belt have severely affected the date fruits too, causing an estimated Rs 2 billion loss to farmers. Local residents told The Express Tribune that heavy rains destroyed dates in Panjgur, Turbat and other parts of the Makran. [ET]
• FY22 Exports: 17.2% increase was witnessed in the country’s service exports during FY22. [ET]
• Sugar Production: The Pakistan Sugar Mills Association (PSMA) referring to the statistics of the Federal Board of Revenue (FBR) expected surplus production in next season and demanded a timely decision of allowing export of surplus sugar. [BR]

AGRI-INPUTS, WEATHER, WATER & POWER

• Lahore Weather: 35°C centigrade was the temperature recorded in Lahore on Thursday. [ET]
• Gas Tariff: Minister of State for Petroleum Dr Musadik Malik on Thursday while ensuring no increase in gas rate said that the government had not increased the rate of gas for any sector, being provided to the consumers on networks of the SNGPL and the SSGC. [BR]
• Hydropower Tariff: Pursuing a revenue target of Rs 121 billion for the current financial year, the Water and Power Development Authority (WAPDA) has requested the National Electric Power Regulatory Authority (NEPRA) to increase the tariff of hydroelectric power by Rs 0.47 per unit. [ET] [The News]
• Petrol Price: As part of its efforts in getting the stalled $6 billion IMF bailout package revived, the Pakistan government is all set to revise the prices of petroleum products on a weekly basis, which was one of the preconditions for the release of the amount to Islamabad, said sources in the Finance Ministry. [The News]
• Contamination of Water: Sindh Minister for Health and Population Welfare has said that waterborne diseases, especially cholera and diarrhea, have been on the rise due to the contamination of water following the heavy monsoon rains in the province. Cholera continues to haunt the cities and hinterlands of KPK as 8 children have reportedly died of the disease in Swabi district. [ET] [ET]

AGRI UPDATES & PAKISTAN POLICY

• WAPDA’s Eurobond: The National Electric Power Regulatory Authority (NEPRA), on Thursday, said that the value of Wapda $500 million raised through Eurobond and deposited into the National Bank of Pakistan, has reduced to $312 million due to rupee depreciation versus the US dollar. [BR]
• Foreign Funding case: Bilal Azhar, coordinator to the Prime Minister for Energy said on Thursday that the Election Commission has exposed the wrongdoing of the Pakistan Tehreek-e-Insaf (PTI) in the prohibited funding case and the government would decide legal action against the party and its chairman. The federal cabinet on Thursday has taken a principled decision to send the declaration against the Pakistan Tehreek-e-Insaf (PTI) to the Supreme Court as per the decision of the Election Commission of Pakistan (ECP). Cabinet orders Interior Ministry, FIA to conduct impartial inquiry. The Ministry was given three days to prepare a declaration for the next cabinet meeting. [BR] [BR] [Dawn] [ET] [The News]
• Pakistan & Zawahiri: Pakistan on Thursday once again dismissed media reports with regard to use of its air space by the United States for carrying out a recent drone attack in which top al-Qaeda leader Ayman al-Zawahiri was killed. [BR]
• Additional Taxes: The Federal Board of Revenue (FBR) Chairman Thursday said additional taxes to the tune of Rs30 billion would be finalised and unveiled soon as the Board was working on it as per the decision of the Economic Coordination Committee (ECC) of the Cabinet in this regard. [BR]
• Withdrawal of CNIC condition: The Directorate General of Digital Invoicing and Analysis (DGDIA) aim to integrate whole supply chain including manufacturers, dealers, distributors, wholesalers and retailers would face issues due to the withdrawal of the Computerised National Identity Card condition on supplies to unregistered persons. [BR]
• Engro Polymer and Chemicals Limited: Engro Polymer and Chemicals Limited (PSX: EPCL) was established in 1997 under the repealed Companies Ordinance, 1984 (now Companies Act, 2017). It is a subsidiary of Engro Corporation Limited. The latter is a subsidiary of Dawood Hercules Corporation Limited. Engro Polymer and Chemicals manufacturers, markets, and sells Poly Vinyl Chloride (PVC), Vinyl Chloride Monomer (VCM), caustic soda and other chemicals. [BR]
• Tighter Fiscal Controls: For ensuring tight fiscal control, the government has put restrictions on technical supplementary grants (TSGs) in the first quarter and imposed a ban on supplementary expenditure, both for developmental and current expenditure, throughout the current fiscal year, except in extreme and exceptional cases. [Dawn]
• World Bank Blocks Loans: In the middle of a serious economic crisis, the World Bank has cancelled or withheld a $335 million concessionary loan quota for Pakistan after Islamabad failed to empower the debt office and could not harmonise the sales tax and property valuation procedures. [ET]
• Telecom Troubles: Telecom sector’s earnings yielded a negative growth in dollar terms due to the spectrum price pegged to the dollar. This threatens the very survival of the telecom sector. [ET]
• NAB Bill Passed Amid PTI Uproar: The National Accountability (Second Amendment) Act 2022 sailed through Senate on Thursday amid strong protests by the opposition parties, especially the Pakistan Tehreek-i-Insaf (PTI) senators who termed the legislation an attempt to turn the National Accountability Bureau (NAB) into a “toothless” organisation. [Dawn]
• Shariah-Compliant Investment: The Securities and Exchange Commission of Pakistan (SECP) has issued a list of seven products and practices that investors adhering to Shariah principles must not procure or utilise, including conventional derivative products. [BR]

INTERNATIONAL – OVERVIEW & MARKET OUTLOOK

• Taiwan Tensions: Southeast Asian foreign ministers urged restraint Thursday as China launched massive military drills off Taiwan, warning the situation risked spiralling into “open conflicts”. US House Speaker Nancy Pelosi arrived in Japan on Thursday for the final stop on her Asian tour, following a visit to Taiwan that incensed China. [BR] [BR]
• Ukraine Under Pressure: Ukraine said on Thursday it had been forced to cede some territory in the east of the country in the face of a Russian offensive, and the head of the NATO military alliance said Moscow must not be allowed to win the war. [BR]
• Iran Nuclear Talks: Indirect talks between Tehran and Washington resumed in Vienna with a meeting between Iran’s chief nuclear negotiator and the EU’s Enrique Mora, who coordinates the talks aimed at salvaging a 2015 nuclear deal, Iranian state media reported on Thursday. [BR] [Dawn]
• Saudi Arabia Crude Prices: Saudi Arabia, the world’s top oil exporter, raised September crude oil prices for Asian buyers to record high levels despite falling refining margins. [BR]
• Bank of England Rate Hike: Britain will sink into a lengthy recession later this year as inflation rockets even higher, the Bank of England forecast on Thursday as it unveiled the biggest interest rate hike since 1995. [Dawn]
• Taliban Deny: Days after US President Joe Biden announced Ayman al Zawahiri’s killing by a drone strike in Kabul, the Taliban said on Thursday they had no knowledge of the Al Qaeda chief’s presence in Afghanistan. [Dawn] [ET]

PAKISTAN - REMAINDERS

• Report: China has lent Pakistan $21.9bn since 2018 - China has made nearly $26 billion in short and medium-term loans to Pakistan and Sri Lanka over the past five years as its overseas lending shifts from funding infrastructure toward providing emergency relief, Bloomberg reported. [The News]
• Opinion: Acute food inflation and a shallow global policy leadership response: - “Global south in particular is suffering from both high food inflation, and serious debt default risk possibilities. Having said that, global leadership, in terms of rich, advanced countries, and multilateral institutions continue to remain quite oblivious to the financing needs of countries, many of which are going through high imported inflation.” - By Dr Omer Javed [BR]
• Opinion: The forever war - “A YEAR after the ignominious withdrawal of American troops from Afghanistan and the tame reconquest of that country by the Afghan Taliban, the Biden administration has reminded us that the US is still the world’s policeman.” - By Asim Sajjad Akhtar [Dawn]
• Editorial: - “Washington swears by One-China policy, and to this day has not recognised Taipei. But when it comes to jingoism, the island-state is a perfect flashpoint for the US to browbeat the Chinese.” [ET]

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