Friday, 26 May 2017
Budget 2017-18 Increase/Decrease In Prices
Pakistan Finance Minister Presented Budget 2017-18 Today at 5 Pm 26-05-2017.
Dekhiye Kya cheez sasti hue aur kya mehngi..
Click the link here under to know:
Kya Hua Sasta in Budget 2017-18
Kya Hua Mehnga in Budget 2017-18
Dekhiye Kya cheez sasti hue aur kya mehngi..
Click the link here under to know:
Kya Hua Sasta in Budget 2017-18
Kya Hua Mehnga in Budget 2017-18
Thursday, 25 May 2017
Exclusive: CPEC Master Plan
Details from original documents laying out the
CPEC long term plan are publicly disclosed for
the first time.
- Plan eyes agriculture
- Large surveillance system for cities
- Visa-free entry for Chinese nationals
The floodgates are about to open. Prime Minister Nawaz Sharif arrived in
Beijing over the weekend to participate in the One Belt, One Road
summit, and the top item on his agenda is to finalise the Long Term Plan
(LTP) for the China-Pakistan Economic Corridor.
Dawn has acquired exclusive access to the original document, and for the
first time its details are being publically disclosed here. The plan
lays out in detail what Chinese intentions and priorities are in
Pakistan for the next decade and a half, details that have not been
discussed in public thus far.
For instance, thousands of acres of agricultural land will be leased out
to Chinese enterprises to set up “demonstration projects” in areas
ranging from seed varieties to irrigation technology. A full system of
monitoring and surveillance will be built in cities from Peshawar to
Karachi, with 24 hour video recordings on roads and busy marketplaces
for law and order. A national fibreoptic backbone will be built for the
country not only for internet traffic, but also terrestrial distribution
of broadcast TV, which will cooperate with Chinese media in the
“dissemination of Chinese culture”.
The plan envisages a deep and broad-based penetration of most sectors of
Pakistan’s economy as well as its society by Chinese enterprises and
culture. Its scope has no precedent in Pakistan’s history in terms of
how far it opens up the domestic economy to participation by foreign
enterprises. In some areas the plan seeks to build on a market presence
already established by Chinese enterprises, eg Haier in household
appliances, ChinaMobile and Huawei in telecommunications and
ChinaMetallurgical Group Corporation (MCC) in mining and minerals.
In other cases, such as textiles and garments, cement and building
materials, fertiliser and agricultural technologies (among others) it
calls for building the infrastructure and a supporting policy
environment to facilitate fresh entry. A key element in this is the
creation of industrial parks, or special economic zones, which “must
meet specified conditions, including availability of water…perfect
infrastructure, sufficient supply of energy and the capacity of self
service power”, according to the plan.
But the main thrust of the plan actually lies in agriculture, contrary
to the image of CPEC as a massive industrial and transport undertaking,
involving power plants and highways. The plan acquires its greatest
specificity, and lays out the largest number of projects and plans for
their facilitation, in agriculture.
Agriculture
For agriculture, the plan outlines an engagement that runs from one end
of the supply chain all the way to the other. From provision of seeds
and other inputs, like fertiliser, credit and pesticides, Chinese
enterprises will also operate their own farms, processing facilities for
fruits and vegetables and grain. Logistics companies will operate a
large storage and transportation system for agrarian produce.
It identifies opportunities for entry by Chinese enterprises in the
myriad dysfunctions that afflict Pakistan’s agriculture sector. For
instance, “due to lack of cold-chain logistics and processing
facilities, 50% of agricultural products go bad during harvesting and
transport”, it notes.
Enterprises entering agriculture will be offered extraordinary levels of
assistance from the Chinese government. They are encouraged to “[m]ake
the most of the free capital and loans” from various ministries of the
Chinese government as well as the China Development Bank. The plan also
offers to maintain a mechanism that will “help Chinese agricultural
enterprises to contact the senior representatives of the Government of
Pakistan and China”.
The government of China will “actively strive to utilize the national
special funds as the discount interest for the loans of agricultural
foreign investment”. In the longer term the financial risk will be
spread out, through “new types of financing such as consortium loans,
joint private equity and joint debt issuance, raise funds via multiple
channels and decentralise financing risks”.
The plan proposes to harness the work of the Xinjiang Production and
Construction Corps to bring mechanization as well as scientific
technique in livestock breeding, development of hybrid varieties and
precision irrigation to Pakistan. It sees its main opportunity as
helping the Kashgar Prefecture, a territory within the larger Xinjiang
Autonomous Zone, which suffers from a poverty incidence of 50 per cent,
and large distances that make it difficult to connect to larger markets
in order to promote development. The prefecture’s total output in
agriculture, forestry, animal husbandry and fishery amounted to just
over $5 billion in 2012, and its population was less than 4 million in
2010, hardly a market with windfall gains for Pakistan.
However, for the Chinese, this is the main driving force behind
investing in Pakistan’s agriculture, in addition to the many profitable
opportunities that can open up for their enterprises from operating in
the local market. The plan makes some reference to export of agriculture
goods from the ports, but the bulk of its emphasis is focused on the
opportunities for the Kashgar Prefecture and Xinjiang Production Corps,
coupled with the opportunities for profitable engagement in the domestic
market.
The plan discusses those engagements in considerable detail. Ten key
areas for engagement are identified along with seventeen specific
projects. They include the construction of one NPK fertilizer plant as a
starting point “with an annual output of 800,000 tons”. Enterprises
will be inducted to lease farm implements, like tractors, “efficient
plant protection machinery, efficient energy saving pump equipment,
precision fertilization drip irrigation equipment” and planting and
harvesting machinery.
The plan shows great interest in the textiles industry in particular,
but the interest is focused largely on yarn and coarse cloth.
Meat processing plants in Sukkur are planned with annual output of
200,000 tons per year, and two demonstration plants processing 200,000
tons of milk per year. In crops, demonstration projects of more than
6,500 acres will be set up for high yield seeds and irrigation, mostly
in Punjab. In transport and storage, the plan aims to build “a
nationwide logistics network, and enlarge the warehousing and
distribution network between major cities of Pakistan” with a focus on
grains, vegetables and fruits. Storage bases will be built first in
Islamabad and Gwadar in the first phase, then Karachi, Lahore and
another in Gwadar in the second phase, and between 2026-2030, Karachi,
Lahore and Peshawar will each see another storage base.
Asadabad, Islamabad, Lahore and Gwadar will see a vegetable processing
plant, with annual output of 20,000 tons, fruit juice and jam plant of
10,000 tons and grain processing of 1 million tons. A cotton processing
plant is also planned initially, with output of 100,000 tons per year.
“We will impart advanced planting and breeding techniques to peasant
households or farmers by means of land acquisition by the government,
renting to China-invested enterprises and building planting and breeding
bases” it says about the plan to source superior seeds.
In each field, Chinese enterprises will play the lead role.
“China-invested enterprises will establish factories to produce
fertilizers, pesticides, vaccines and feedstuffs” it says about the
production of agricultural materials.
“China-invested enterprises will, in the form of joint ventures,
shareholding or acquisition, cooperate with local enterprises of
Pakistan to build a three-level warehousing system (purchase &
storage warehouse, transit warehouse and port warehouse)” it says about
warehousing.
One of the most intriguing chapters in the plan speaks of a long belt of
coastal enjoyment industry that includes yacht wharfs, cruise
homeports, nightlife, city parks, public squares, theaters, golf courses
and spas, hot spring hotels and water sports.
Then it talks about trade. “We will actively embark on cultivating
surrounding countries in order to improve import and export potential of
Pakistani agricultural products and accelerate the trade of
agricultural products. In the early stages, we will gradually create a
favorable industry image and reputation for Pakistan by relying on
domestic demand.”
In places the plan appears to be addressing investors in China. It says
Chinese enterprises should seek “coordinated cooperation with Pakistani
enterprises” and “maintain orderly competition and mutual coordination.”
It advises them to make an effort “seeking for powerful strategic
partners for bundling interest in Pakistan.”
As security measures, enterprises will be advised “to respect the
religions and customs of the local people, treat people as equals and
live in harmony”. They will also be advised to “increase local
employment and contribute to local society by means of subcontracting
and consortiums.” In the final sentence of the chapter on agriculture,
the plan says the government of China will “[s]trengthen the safety
cooperation with key countries, regions and international organizations,
jointly prevent and crack down on terrorist acts that endanger the
safety of Chinese overseas enterprises and their staff.”
Industry
For industry, the plan trifurcates the country into three zones: western
and northwestern, central and southern. Each zone is marked to receive
specific industries in designated industrial parks, of which only a few
are actually mentioned. The western and northwestern zone, covering most
of Balochistan and KP province, is marked for mineral extraction, with
potential in chrome ore, “gold reserves hold a considerable potential,
but are still at the exploration stage”, and diamonds. One big mineral
product that the plan discusses is marble. Already, China is Pakistan’s
largest buyer of processed marble, at almost 80,000 tons per year. The
plan looks to set up 12 marble and granite processing sites in locations
ranging from Gilgit and Kohistan in the north, to Khuzdar in the south.
The central zone is marked for textiles, household appliances and
cement. Four separate locations are pointed out for future cement
clusters: Daudkhel, Khushab, Esakhel and Mianwali. The case of cement is
interesting, because the plan notes that Pakistan is surplus in cement
capacity, then goes on to say that “in the future, there is a larger
space of cooperation for China to invest in the cement process
transformation”.
“There is a plan to build a pilot safe city in Peshawar, which faces a
fairly severe security situation in northwestern Pakistan”.
For the southern zone, the plan recommends that “Pakistan develop
petrochemical, iron and steel, harbor industry, engineering machinery,
trade processing and auto and auto parts (assembly)” due to the
proximity of Karachi and its ports. This is the only part in the report
where the auto industry is mentioned in any substantive way, which is a
little surprising because the industry is one of the fastest growing in
the country. The silence could be due to lack of interest on the part of
the Chinese to acquire stakes, or to diplomatic prudence since the
sector is, at the moment, entirely dominated by Japanese companies
(Toyota, Honda and Suzuki).
Gwadar, also in the southern zone, “is positioned as the direct
hinterland connecting Balochistan and Afghanistan.” As a CPEC entreport,
the plan recommends that it be built into “a base of heavy and chemical
industries, such as iron and steel/petrochemical”. It notes that “some
Chinese enterprises have started investment and construction in Gwadar”
taking advantage of its “superior geographical position and cheap
shipping costs to import crude oil from the Middle East, iron ore and
coking coal resources from South Africa and New Zealand” for onward
supply to the local market “as well as South Asia and Middle East after
processing at port.”
The plan shows great interest in the textiles industry in particular,
but the interest is focused largely on yarn and coarse cloth. The
reason, as the plan lays out, is that in Xinjiang the textile industry
has already attained higher levels of productivity. Therefore, “China
can make the most of the Pakistani market in cheap raw materials to
develop the textiles & garments industry and help soak up surplus
labor forces in Kashgar”. The ensuing strategy is described cryptically
as the principle of “introducing foreign capital and establishing
domestic connections as a crossover of West and East”.
Preferential policies will be necessary to attract enterprises to come
to the newly built industrial parks envisioned under the plan. The areas
where such preferences need to be extended are listed in the plan as
“land, tax, logistics and services” as well as land price, “enterprise
income tax, tariff reduction and exemption and sales tax rate.”
Fibreoptics and surveillance
One of the oldest priorities for the Chinese government since talks on
CPEC began is fibreoptic connectivity between China and Pakistan. An MoU
for such a link was signed in July 2013, at a time when CPEC appeared
to be little more than a road link between Kashgar and Gwadar. But the
plan reveals that the link goes far beyond a simple fibreoptic set up.
China has various reasons for wanting a terrestrial fibreoptic link with
Pakistan, including its own limited number of submarine landing
stations and international gateway exchanges which can serve as a
bottleneck to future growth of internet traffic. This is especially true
for the western provinces. “Moreover, China’s telecom services to
Africa need to be transferred in Europe, so there is certain hidden
danger of the overall security” says the plan. Pakistan has four
submarine cables to handle its internet traffic, but only one landing
station, which raises security risks as well.
So the plan envisages a terrestrial cable across the Khunjerab pass to
Islamabad, and a submarine landing station in Gwadar, linked to Sukkur.
From there, the backbone will link the two in Islamabad, as well as all
major cities in Pakistan.
The expanded bandwidth that will open up will enable terrestrial
broadcast of digital HD television, called Digital Television
Terrestrial Multimedia Broadcasting (DTMB). This is envisioned as more
than just a technological contribution. It is a “cultural transmission
carrier. The future cooperation between Chinese and Pakistani media will
be beneficial to disseminating Chinese culture in Pakistan, further
enhancing mutual understanding between the two peoples and the
traditional friendship between the two countries.” The plan says nothing
about how the system will be used to control the content of broadcast
media, nor does it say anything more about “the future cooperation
between Chinese and Pakistani media”.
udging from their conversations with the government, it appears that the
Pakistanis are pushing the Chinese to begin work on the Gwadar
International Airport, whereas the Chinese are pushing for early
completion of the Eastbay Expressway.
It also seeks to create an electronic monitoring and control system for
the border in Khunjerab, as well as run a “safe cities” project. The
safe city project will deploy explosive detectors and scanners to “cover
major roads, case-prone areas and crowded places…in urban areas to
conduct real-time monitoring and 24 hour video recording.” Signals
gathered from the surveillance system will be transmitted to a command
centre, but the plan says nothing about who will staff the command
centre, what sort of signs they will look for, and who will provide the
response.
“There is a plan to build a pilot safe city in Peshawar, which faces a
fairly severe security situation in northwestern Pakistan” the plan
says, following which the program will be extended to major cities such
as Islamabad, Lahore and Karachi, hinting that the feeds will be shared
eventually, and perhaps even recorded.
Tourism and recreation
One of the most intriguing chapters in the plan is the one that talks
about the development of a “coastal tourism” industry. It speaks of a
long belt of coastal enjoyment industry that includes yacht wharfs,
cruise homeports, nightlife, city parks, public squares, theaters, golf
courses and spas, hot spring hotels and water sports. The belt will run
from Keti Bunder to Jiwani, the last habitation before the Iranian
border. Then, somewhat disappointingly, it adds that “more work needs to
be done” before this vision can be realized.
The plans are laid out in surprising detail. For instance, Gwadar will
feature international cruise clubs that “provide marine tourists private
rooms that would feel as though they were ‘living in the ocean’”. And
just as the feeling sinks in, it goes on to say that “[f]or the
development of coastal vacation products, Islamic culture, historical
culture, folk culture and marine culture shall all be integrated.”
Apparently more work needs to be done here too.
For Ormara, the plan recommends building “unique recreational
activities” that would also encourage “the natural, exciting,
participatory, sultry, and tempting characteristics” to come through.
For Keti Bunder it recommends wildlife sanctuaries, an aquarium and a
botanical garden. For Sonmiani, on the eastern edge of Karachi,
“projects like a coastal beach, extended greenway, coastal villa, car
camp, SPA, beach playground and a seafood street can be developed.”
It is an expansive vision that the plan lays out, and towards the end,
it asks for the following: “Make the visa-free tourism possible with
China to provide more convenient policy support for Chinese tourists to
Pakistan.” There is no mention of a reciprocal arrangement for Pakistani
nationals visiting China.
Finance and risk
In any plan, the question of financial resources is always crucial. The
long term plan drawn up by the China Development Bank is at its sharpest
when discussing Pakistan’s financial sector, government debt market,
depth of commercial banking and the overall health of the financial
system. It is at its most unsentimental when drawing up the risks faced
by long term investments in Pakistan’s economy.
The chief risk the plan identifies is politics and security. “There are
various factors affecting Pakistani politics, such as competing parties,
religion, tribes, terrorists, and Western intervention” the authors
write. “The security situation is the worst in recent years”. The next
big risk, surprisingly, is inflation, which the plan says has averaged
11.6 per cent over the past 6 years. “A high inflation rate means a rise
of project-related costs and a decline in profits.”
Efforts will be made, says the plan, to furnish “free and low interest
loans to Pakistan” once the costs of the corridor begin to come in. But
this is no free ride, it emphasizes. “Pakistan’s federal and involved
local governments should also bear part of the responsibility for
financing through issuing sovereign guarantee bonds, meanwhile
protecting and improving the proportion and scale of the government
funds invested in corridor construction in the financial budget.”
It asks for financial guarantees “to provide credit enhancement support
for the financing of major infrastructure projects, enhance the
financing capacity, and protect the interests of creditors.” Relying on
the assessments of the IMF, World Bank and the ADB, it notes that
Pakistan’s economy cannot absorb FDI much above $2 billion per year
without giving rise to stresses in its economy. “It is recommended that
China’s maximum annual direct investment in Pakistan should be around
US$1 billion.” Likewise, it concludes that Pakistan’s ceiling for
preferential loans should be $1 billion, and for non preferential loans
no more than $1.5 billion per year.
It advises its own enterprises to take precautions to protect their own
investments. “International business cooperation with Pakistan should be
conducted mainly with the government as a support, the banks as
intermediary agents and enterprises as the mainstay.” Nor is the growing
engagement some sort of brotherly involvement. “The cooperation with
Pakistan in the monetary and financial areas aims to serve China’s
diplomatic strategy.”
The other big risk the plan refers to is exchange rate risk, after
noting the severe weakness in Pakistan’s ability to earn foreign
exchange. To mitigate this, the plan proposes tripling the size of the
swap mechanism between the RMB and the Pakistani rupee to 30 billion
Yuan, diversifying power purchase payments beyond the dollar into RMB
and rupee basket, tapping the Hong Kong market for RMB bonds, and
diversifying enterprise loans from a wide array of sources. The growing
role of the RMB in Pakistan’s economy is a clearly stated objective of
the measures proposed.
Conclusion
It is not clear how much of the plan will be earnestly followed up and
how much is there simply to evince interest from the Pakistani side. In
the areas of interest contained in the plan, it appears access to the
full supply chain of the agrarian economy is a top priority for the
Chinese. After that the capacity of the textile spinning sector to serve
the raw material needs of Xinjiang, and the garment and value added
sector to absorb Chinese technology is another priority.
Next is the growing domestic market, particularly in cement and
household appliances, which receive detailed treatment in the plan. And
lastly, through greater financial integration, the plan seeks to advance
the internationalization of the RMB, as well as diversify the risks
faced by Chinese enterprises entering Pakistan.
In some areas the plan seeks to build on a market presence already
established by Chinese enterprises, eg Haier in household appliances,
ChinaMobile and Huawei in telecommunications and China Metallurgical
Group Corporation (MCC) in mining and minerals.
Gwadar receives passing mention as an economic prospect, mainly for its
capacity to serve as a port of exit for minerals from Balochistan and
Afghanistan, and as an entreport for wider trade in the greater Indian
Ocean zone from South Africa to New Zealand. There is no mention of
China’s external trade being routed through Gwadar. Judging from their
conversations with the government, it appears that the Pakistanis are
pushing the Chinese to begin work on the Gwadar International Airport,
whereas the Chinese are pushing for early completion of the Eastbay
Expressway.
But the entry of Chinese firms will not be limited to the CPEC framework
alone, as the recent acquisition of the Pakistan Stock Exchange, and
the impending acquisition of K Electric demonstrate. In fact, CPEC is
only the opening of the door. What comes through once that door has been
opened is difficult to forecast.
Courtesy: Daily dawn
In March
Mar 16: Justice Saeeduddin Nasir of Sindh High Court passed away.
Mar 16: Pakistan Navy successfully conducted the test launch of a land-based anti-ship missile.
Mar 16: The
federal government made it mandatory for health professionals or
healthcare establishments to make video recording of every cardiac
procedure.
Mar 16: The Senate of Pakistan passed the Pakistan Climate Change Act.
Mar 16: The Sindh government launched Sindh Peoples Ambulance service in Thatta and Sujawal.
Mar 16: Celebrated
British social worker and environmentalist Maureen P. Lines, known for
her work on the Kalasha people, passed away. She was 79.
About Ms Lines
- Born in 1937 in England, Ms Lines first visited Pakistan in 1980.
- She lived among the Kalasha, learning their language and ways.
- She was a recipient of the Tamgha-i-Imtiaz for extraordinary services rendered in the preservation and promotion of Kalasha culture.
- Ms Lines was the founder of the Kalasha Environmental Protection Society and the Hindukush Conservation Association.
- She was also the author of several books, including Beyond the North-West Frontier, A Guide to the Kalasha People, and The Kalasha of the Hindu Kush.
Mar 18: Brilliant athlete Nadia Nazir breathed her last.
About Nadia Nazir
- Nadia was a four-time national champion and a record-holder in 400-metre hurdles race since 2007 with a timing of 61.50 seconds which is yet to be surpassed.
- She started her running career in 2000.
- She became the national champion in 2006.
- She beat her own record at the 2007 National Games and from then on, she won the title of national champion for six consecutive years.
- Nadia also competed in the World Championship and Asian Games besides visiting India, Sri Lanka, Bangladesh, Iran, Hong Kong and China.
Mar 18: The
United Nations Security Council adopted a resolution to extend the
mandate of the UN Assistance Mission in Afghanistan (UNAMA) by one year.
China’s “One Belt, One Road” project that includes the China-Pakistan
Economic Corridor (CPEC) also received the backing by being mentioned in
the resolution.
Mar 19: Twelve-year-old
Uzair Abdullah became the youngest charter member in the certification
of Microsoft Certified Solutions Expert (MCSE) in cloud platform and
infrastructure.
Mar 19: Islamabad’s Shabbir Iqbal, the top-ranked golf professional of the country, clinched the Punjab Open Golf Championship title.
Mar 19: President Mamnoon Hussain gave his formal assent to the Hindu Marriage Bill 2017.
The Hindu Marriage bill — the first personal law at the federal level to
regulate the marriages of Hindus — is aimed at protecting the marriages
and the family and safeguarding the rights and interests of the Hindu
families in Pakistan.
March 19: Pakistan was ranked as the 80th happiest country on the planet in the World Happiness Report 2017.
5 Happiest Countries: Norway (1); Denmark (2); Iceland (3); Switzerland (4) and Finland (5).
5 Saddest Countries: Rwanda (151); Syria (152); Tanzania (153); Burundi (154) and Central African Republic (155).
Other SAARC Nations: Nepal (99); Bhutan (97); Bangladesh (110); Sri Lanka (120) and India (122). Maldives did not figure in the report.
Mar 20: The government reopened border crossings with Afghanistan as a goodwill gesture.
Mar 20: Tehmina
Janjua assumed charge as the 29th foreign secretary, becoming the first
woman in the country to lead the foreign ministry.
Mar 20: The
Islamabad High Court (IHC) ordered the release of former religious
affairs minister Hamid Saeed Kazmi in the Haj corruption case.
Mar 21: Saeed Ahmad, former Deputy Governor SBP, was appointed the President National Bank of Pakistan (NBP).
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