Twelve Satellite Television Licenses
To Be Awarded To Pakistani Companies

ISLAMABAD, Pakistan : April 15 (PNS) - It has been decided in principle to award licenses to twelve Pakistani companies for operation of satellite television channels in the country. The decision to this effect was taken at a meeting of the Pakistan electronic media regularity authority held in Islamabad Thursday.

Already ten licenses have been granted by the authority for operation of satellite television channels in the country this year. In order to liberalize and ease restrictions on cross media ownership of electronic media the Authority decided to setup a working group to formulate recommendations for making amendments in the PEMRA ordinance and PEMRA rules 2002. The PEMRA has awarded licenses for establishment of fm radio stations and cable TV operations in the country.

It has taken wide ranging steps to promote electronic media in the private sector in the country with the objective of giving greater access to the people of Pakistan to the mass media and for raising standards of information, education and entertainment.

http://www.paknews.com/flash.php?id=9&date1=2004-04-16

Essentials for Islamic banking approved

RECORDER REPORT

KARACHI (April 17 2004): The State Bank's Shariah Board on Friday approved essentials and model agreements for Islamic modes of financing to ensure compliance with the minimum Shariah standards by banks conducing Islamic banking in the country.

These essentials and guidelines would be enforced as prudential regulations for Islamic banks in due course and would be taken as general guidelines to be followed by banking institutions conducting Islamic banking in the country.

With dual objectives of facilitating the existing Islamic banking sector and the potential market players to develop Islamic banking products in particular and to create awareness about Islamic banking products in general, model agreements for following modes have been designed: Murabaha, Musawamah, Lease Agreement, Salam, Musharaka (Musharaka Investment Agreement), Istisna, Intfree (agreements for interest-free loan), Mudaraba, (Mudaraba financing agreement), Synd Mudaraba (syndication Mudaraba agreement).

These are model agreements, which can be modified, according to the products designed by the banks conducting Islamic banking business, with the approval of Shariah Board of Islamic commercial banks or Shariah adviser of banks having Islamic banking branches, ensuring that such changes are consistent with the principles of Shariah.

"It does not preclude the possibility of developing new modes or instruments of financing, modifications or variants of the modes provided they are Shariah compliant," said a detail statement issued by the State Bank.

The State Bank has provided details about the each type of agreement and posted all details on its website.

The Bank also invited suggestions for the posted details.

TURNING POINT: Bankers said it was a turning point in the banking history of Pakistan and would bring tremendous change with the inclusion of Islamic flavour in the banking.

The Governor State Bank, Dr Ishrat Husain, had said last month that the Islamic banking had been provided with level playing field and there was tremendous potential for its growth in the country.

Islamic banking has just started in the country and only one bank is operational here.

Recently, Bank-al-Khybar has converted one branch into Islamic banking and the NWFP government is taking interest for its promotion.

The Islamic banking is the fastest growing financial sector in the world of which annual growth is 15 percent.

The Shariah Board of the SBP, headed by former minister of religious affairs Mahmood Ghazi last month assured that the Islamic banking would be promoted on fast track.

VAST POTENTIAL: However, bankers were of the opinion that so far the Islamic mode of banking is very limited and believe that it would take another five years to produce popular products.

The Islamic mode of financing or banking has vast potential to grow but big efforts are required to mobilise funds for its development.

Bankers said that over 50 percent of rural population were whiling to use Islamic banking and most of them are interested in the interest-free loan.

Some bankers said that the Islamic mode of financing for the housing sector would be another attraction for many people.

Copyright Business Recorder, 2004
www.brecorder.com

Drivers using cell phones on highways to be fined

By Our Staff Reporter

LAHORE, April 23: The National Highways and Motorway Police will book drivers who use cell phone while driving on highways from May 1. This was stated by DIG (N-5) Dr Wasim Kausar while talking to Dawn here on Friday.

He said the motorway police squads would make video films of the violators and fine them up to Rs500. He said the decision was taken in the wake of a number of accidents on the highways due to this reason.

He said the motorway police had already launched a campaign to create awareness among drivers. DIG Kausar said students of different colleges and universities had been involved in the campaign.

VIDEO FILMS: The NH&MP has started making video films of the passengers of a private transport company following the recent incidents of dacoity aboard its vehicles.

The NH&MP usually makes videos of all the private vehicles especially buses and vans on the GT roads and highways to identify culprits who deprive passengers of their valuables during the journey. However, Daewoo was exempted because of its own security system.

But in the recent past, highwaymen had struck successfully in the company buses. NH&MP DIG (N-5) Dr Waseem Kasur told Dawn on Friday that the motorway police had asked the company management to also recruit guards to ensure safety of its passengers.

http://www.dawn.com/2004/04/24/local21.htm

NCA Film and TV Department: Education Ministry approves Rs 40 million

*College could collaborate with German film academy

By Shoaib Ahmed

LAHORE: The Ministry of Education has approved Rs 40 million for the purchase of equipment to be installed at the Film and Television Department of the National College of Arts (NCA), sources told Daily Times on Friday.

“Proposal for the purchase of the equipment was forwarded to the university a few months ago. It has recently been approved and the funds will be released in the next financial year,” said sources.

Sources said the NCA had paid around seven million rupees for a five-kanal piece of land adjacent to the college owned by Army to set up the Film and TV Department, but the land had not yet been handed over to the college. The land was promised to the college by President Pervez Musharraf at a convocation.

“The plot has not yet been given to us. Therefore, the administration has decided to build two additional storeys on the existing Architecture Department building,” said the NCA sources. They said the department’s studio is planned to be set up at the ground where the second year’s design studio is located. The design studio would be shifted to the architecture block, they added.

They said the Academy for Film and Television in Munich, Germany, had also shown its willingness to collaborate with the NCA’s film and TV department.

The Japan International Cooperation Agency (JICA) has sent Iswasaki Kohie, one of their senior officials, to help the NCA set up the new department. Mr Kohie will help the college select the equipment and develop the curriculum.

“The NCA will organise an Iranian film festival followed by a German film festival as part of its preparatory efforts to start the new department,” said sources. NCA Principal Sajida Wandal also confirmed the Education Ministry’s approval, the college’s collaboration with the German academy and the construction of two additional storeys. “With the establishment of the Film and TV Department, another important art form would formally be introduced to students to explore and integrate in a variety of visual art practices at the NCA,” said Ms Wandal. She said the department would start a four-year study programme, ending with an undergraduate degree and a one-year professional diploma certificate in screenplay writing.

The department’s project was initiated in 2000 and initially a five-member committee, consisting of Roshan Dhanjibouy from the Henrich Boll Foundation, Faryal Gohar, Shireen Pasha, Samina Peerzada and Sajjad Gul, was formed for consultation and assistance. Later, more members were added to the committee and it held several workshops on different aspects of the department. The first workshop was conducted by Faryal Gohar on Fundamentals of Filmmaking, followed by a documentary film production by Shireen Pasha, a video film production by Usman Peerzada, screenplay writing by Wolfgang Laengsfeld from Germany, a Spanish cinema workshop conducted by Don Oscar Peyrou – a Spanish film expert and TV scriptwriting by Haseena Moeen.

Ms Wandal said the college had also planned a six-month course in Multan in collaboration with the Bahauddin Zakariya University. “The course will focus on introducing art creativity to students, enhancing their skills through lectures and talks,” she said. She added that the main areas of the programme would be basic drawing, introduction to painting ceramics and design. Students would be offered three two-week workshops on ceramics, block printing and watercolour painting. Additionally, a study trip to historic monuments in Multan would be organised where students would do onsite drawings.

http://www.dailytimes.com.pk/default...-4-2004_pg7_18

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ANF anti-drug programmes extended

ISLAMABAD Interior and Narcotic Control Minister Makhdoom Faisal Saleh Hayat has said that anti-drug programmes have been extended for the next five years to root out the drug menace.

Talking to journalists after chairing a high-level meeting at the Narcotic Control Division on Friday, he said that this programme has been extended to 2008 and during this span the division would be revamped. He said that the Frontier Constabulary and the other law enforcement agencies would also help the Anti Narcotics Force eradicate this scourge from society.

He said that there is an acute shortage of manpower in the Anti Narcotics Force (ANF) and more than 1,000 people will be recruited into this force. staff report

http://www.dailytimes.com.pk/default...-4-2004_pg7_26


'Upgradation of port to attract transit trade'

By Our Staff Reporter

KARACHI, April 24: The Karachi Port could become a global hub for the shipping sector connecting Central Asia, Afghanistan and the rest of the world if the current pace of development and automation is continued for providing state-of-the-art facilities to port users.

This was stated by Communications Minister Senator Babar Khan Ghouri on Saturday at a reception organized by the Karachi International Container Terminal on the occasion of completion of its Phase-II.

The upgradation of port facilities, he said, would enable the port to attract traffic to and from the Middle and Far East, and also attract transit trade to North India, the traditional hinterland for the Karachi Port.

The minister said that with the establishment of Gwadar Port, the country would be having greater impact on the shipping sector of the region and would open up new vistas by bringing in a deep change in the shipping routes of the region.

Commenting on the efforts of the KPT and KICT, the minister said: "Recent growth in country's exports required such port infrastructural developments as being presently undertaken and it is an excellent example of the public-private sector partnership and other organizations should emulate."

He said the current team involved in development activities of the port and shipping sector, including director general of Port and Shipping, Capt Anwar Shah and KPT team headed by its chairman vice-admiral Ahmad Hayat, are rendering great services to this sector.

Mr Ghouri said that it was a great pride that the KPT, which was primarily a public sector organization, was earning over Rs4 billion for the last two years and had been financing its projects from its own resources.

He also appreciated that welfare projects of the port town under taken by the KPT and said this would not only provide much-needed shelter to the families of a large number of workers, but would also help boost the construction industry.

The setting up of a desalination plant, the minister said, would remove the sufferings of the people of the port city and act as an example for others to follow so that portable water shortage could end and give relief to the masses.

The minister assured his full support for the development of resorts and clubs being undertaken by the KPT and said that such investments were needed to provide recreation facilities to the citizen.

KPT chairman Ahmad Hayat said: "It is indeed a matter of pride for both the KPT and the KICT to have completed the second phase project ahead of time. Serving as the backbone to regional trade, we are looking forward to continued success of the ports and shipping sector of the country through public-private partnership."

The KPT chief said in the years to come the country would be well-positioned as the preferred trade route for transit cargo as well as international trade carried out in this region.

He said the Karachi Port initiated its privatization process when the KICT was awarded to the container terminal in July 1996, and since then there had been no looking back. In 2002, the PICT was set up on East Wharves. Its phase-I has been completed with the arrival of two gantry cranes and many RTGs.

The recent political developments, he said, had placed the region in a central yet fragile position. A lot of extra effort has been made to make the Karachi Port investment friendly.

He said the KICT had proposed another expansion in its facilities by adding berth 26 and 27 to its terminal, deepening the entire 975m length of the quay wall to 14m for the KPT, and bringing two new gantry cranes and other equipment to the terminal with a total investment of $55 million.

The KPT chairman also briefly highlighted other development projects which are being undertaken by the port in the near future.

He said the cargo village, which started on a limited concept, would eventually spread over 1,250 acres with CFS, integrated container depots, warehouses, various processing industries, but special emphasis would be on food processing plants having their own quay walls, connected to the main channel.

http://www.dawn.com/2004/04/25/ebr4.htm

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[B]Pakistan-Iran gas pipeline

Technical team leaves for Iran to hold talks

ISLAMABAD: A four-member expert team from Pakistan will leave for Iran on Monday (tomorrow) to visit the site from where Iran would export gas to Pakistan and to hold discussions on other technical issues with regard to laying of proposed $2.5 billion Iran-Pakistan gas pipeline, a senior official of the ministry of petroleum and natural resource told Daily Times here Saturday.

“The four member technical team, headed by Rashid Lone, managing director of Inter State Gas System (ISGS), would visit the South Pars gas filed, the site from where the Iran would export gas to Pakistan.” “The expert team would be briefed about the potential of the gas reserves in South Pars gas filed,” the official said and added the Pakistani team would also examine as to whether any other country have the claim for importing the gas from the said side or not.

He said in case of Turkmenistan-Afghanistan-Pakistan gas pipeline (TAP), Russia had the claim to import of gas from the Daultabad gas field in Turkmenistan from where the gas was to be exported to Pakistan through the TAP gas pipeline. This was a source of worry to Afghanistan and Pakistan and therefore Pakistani experts will also examine whether any country has the claim of importing gas from the said site or not before formally inking the agreement on importing gas through the Iran-Pakistan gas pipeline.

The official said the delegation would also discuss routes from where the gas pipeline would enter Pakistan and added that Iran would bear the cost of laying the gas pipeline from the South Pars gas field to the Pakistani border area, from where the government of Pakistan would lay the gas line from border to its own gas system.

“After the refusal by India in becoming the part of the gas pipeline, Iran had sought the commitment from Pakistan for purchasing the gas through the proposed $3 billion Iran-Pakistan-India gas pipeline under its new proposal.” The official said Iran under its new proposal wants the completion of the gas pipeline in two phases and under the Phase-1, the gas pipeline would be completed from Iran to Pakistan and then under Phase-2 it would be completed from Pakistan to India in case of willingness by India. “Iran had asked Pakistan to give commitment as to how much gas it would purchase from Iran after the completion of phase-1,” the official said. —KM

http://www.dailytimes.com.pk/default...5-4-2004_pg5_9


Review of the economy]

EDITORIAL (April 26 2004): The nine-month review (July-March, 2004) of the economy released by the Government of Pakistan on 21st April underlines once again a steady improvement in most of the economic indicators.

Higher-than-expected wheat and rice output owing to 29 percent increase in water availability, and extraordinary industrial production have improved the growth prospects to 5.8 percent as against the target of 5.3 percent during the current fiscal year.

Tax collections during July-March, 2004 stood at Rs 352 billion as against Rs 310 billion last year, showing a marked rise of 13.6 percent, and Rs 10 billion higher than the target of Rs 342 billion set earlier by the government. Credit to the private sector expanded by Rs 237 billion which was almost two-and-a-half times higher than Rs 101 billion in the same period last year.

The Karachi Stock Exchange Index moved up from 3,433 points on 1st July, 2003 to 5,582 points on April 16, 2004 while the market capitalisation increased from Rs 754 billion to Rs 1490 billion, implying an increase of 97.5 percent.

Although trade deficit widened from $1.17 billion to $1.6 billion, exports registered an increase of 13.3 percent and are likely to easily exceed the target during the year.

Workers' remittances, though lower than last year, are also expected to reach the target of $3.6 billion.

Foreign exchange reserves of the country stood at $12.57 billion as on April 15, 2004 as against $10.73 billion at the end of June, 2003. Exchange rate of the rupee in the interbank market also appreciated marginally during the review period.

As against these favourable developments, there are certain weak areas which could be easily noticed. Inflation rate is higher than last year. In particular, food inflation has gone up to 4.6 percent compared with 3.3 percent in the corresponding period last year.

The increase in inflation was due to price hike in some core items like wheat, beef, mutton, wheat flour, vegetable ghee and onions in the last five months. Total foreign private investment was down.

While direct foreign investment decreased from $658 million to $632 million, portfolio investment registered on outflow of $45.5 million as against the inflow of $6.5 million last year.

Overall, however, there are indications that most of the targets of the key economic indicators would be surpassed by significant margins.

According to the review, it is generally perceived, within and outside the country, that Pakistan's economy is now back on the path of high economic growth as it experienced in the 1980s along-with macro-economic stability.

Certain facts can easily be discerned from the report. It is obvious that the process of streamlining Pakistan's economic fundamentals that began four years ago, has more or less succeeded and is gaining ground with the passage of time.

The country has overcome the menace of widening deficits of budgetary balance and external sector account which at one time appeared to be out of control.

The debt profile has been greatly improved and solvency of the country is now more or less assured. Thanks to the success of structural reforms and macro-economic stability, Pakistan is now poised for a higher growth trajectory of 6 percent and even beyond.

However, there are certain endemic problems which are usually highlighted by the top officials of the government, but refuse to go away or even subside. Poverty and unemployment is, by most indications, growing in the country.

The fact that inflation is rising and that too because of a sharp increase in the prices of essential items like wheat flour, edible oils and onions is a matter of great concern. This would make the lives of poor people even more miserable.

The government was quite optimistic about the increased inflow of FDI and its positive impact on growth, creation of jobs and poverty reduction but the developments during the year so far are not encouraging.

In order to increase FDI and tap its potential, the government needs to do much more in concrete fashion than lip service. Mere seminars and conferences cannot influence the decisions of foreign investors in a significant manner.

Some other policies also need to be revisited. A large part of expansion in private sector credit may have been attributable to the pick-up in economic activity in the country, but some of its uses appear to be sub-optimal.

Although the State Bank has limited commercial banks' exposure towards equity markets to 20 percent of capital yet their overall investment in shares market continues to be large, if the credit lines to major brokerage firms are added in this portfolio.

This together with abnormal growth in personal loans which might have been utilised for buying shares has pushed up the stock exchange indices to dizzying heights and have no correlation with the productivity of individual companies.

The financing of this kind of speculative activity generally does not add to productive capacity or employment generation. On the other hand, it could promote a gambling culture or the desire for easy money in the society. Also, Badla rates in the market are several times higher than the average lending rates, which means that agents with easy access to credit lines are taking undue advantage of their privileged position.

The channelising of credit in this way sends wrong signals to the genuine investors and is not judicious.

As the review indicates, portfolio investment is on the decline and this should prompt the policy makers to investigate the causes of this trend and the role of credit in financing speculative activities and undertake necessary measures to channelise credit towards more productive activities.

Government policies and bank credit were also expected to be geared to promote construction activities and SMEs for very justifiable reasons, but no major headway seems to have been made in this direction due to various constraints. Title of lands needs to be streamlined along with certain other improvements to induce the banks to advance more loans to the housing sector.

Land for construction of housing units should be auctioned to the developers and, like other countries, prospective home owners should be encouraged to mortgage the property.

The present practice of developing the land at a great cost by the local authorities and then giving it to the army and civil servants at a low fixed price is highly inequitable.

The lack of a proper system has resulted in a situation where cost of houses has gone out of the reach of even upper middle classes, banks are reluctant to commit themselves on a long term basis and vested interests are making a lot of money without some real effort.

SMEs, which were supposed to be the engine of growth and employment generation, are so much shackled by outdated laws and fearful of corrupt practices that they don't want to be registered as such.

While, overall, we are pleased with economic policies and performance, there are still certain areas that require immediate attention of the authorities for promoting balanced growth and employment.

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ADB warns of banking crisis in Pakistan

* Says non-performing loan ratio is alarming

MANILA: Pakistan, India and Taiwan are at risk of a banking crisis unless the authorities push through reforms in the industry, the Asian Development Bank (ADB) warned on Wednesday.

Seven years on, India, Pakistan, and Taiwan “may face one if the authorities are unable to forestall a crisis using pre-emptive financial reforms,” the ADB said in its annual economic outlook report.

The pressure of globalisation and ensuing liberalisation has exposed the shortcomings of the financial sectors of these countries including “low capitalisation ratios, limited expertise in risk management”, rising bad loans and inadequate banking supervision and regulation. “Non-performing loan (NPL) ratios are reaching all-time highs in these three economies, even as the reported figures are still thought to underestimate the actual levels,” the report said. “The role that globalisation has played in exposing financial sector weaknesses suggests that financial sector problems could become more acute over the coming decade unless, critically, governments take advantage of the current macroeconomic buoyancy to address them.”

Asian governments must develop capital markets to serve as alternative financing sources, improve corporate governance of banks and revamp insolvency laws, the report said.

The health of the banking sectors of the five previous crisis countries remains “fragile” while in some others, “reform efforts have been more limited and problems may be looming”, the ADB said. “This situation reflects cases where resolution schemes and banking supervision may not be working properly”, or more importantly, “that banking sector reform has been limited and banks are creating more NPLs while disposing of the old ones”.

The ADB also warned that the practice by banks of using debt-equity swaps to dispose of NPLs may come back to haunt them as such a practice may not improve banking operations, raising the possibility of more NPLs in the future. Boosted by continued buoyancy in domestic and external sectors, Pakistan’s economy is expected to grow 5.5 percent in fiscal year 2004 and 5.8 percent in 2005, according to an Asian Development Bank (ADB) report released on Wednesday.

The Asian Development Outlook 2004 (ADO), an annual ADB publication that forecasts economic trends in the region, says that the foundation has been laid for significantly higher growth and Pakistan’s outlook is stronger and the economy could possibly move to a path of over 6 percent in subsequent years.

“Solid improvement in the macro-economic fundamentals and structural reforms that are boosting investment activity, such as the modernisation of the textile industry, underpin this outlook,” the ADB said. The current account surplus increased sharply, foreign exchange reserves touched new heights, the overall fiscal deficit declined further, and inflation remained low. Export growth was also the highest in over a decade, the report said.

Pakistan’s economy is supported by global economic recovery, and improved relations with India will enhance the investment climate and boost economic activity. In addition, the positive economic outlook is backed by a significantly strengthened economic base. Agriculture will get a lift from investments made in irrigation infrastructure in the past few years to combat drought. Adoption of water-saving techniques by farmers during the drought years will also benefit agricultural production, the report said.

Pakistan’s largest industry, textile production, has seen a sharp increase in investment, as indicated by the more than doubling of imports of textile machinery in the past three years, the report said. This has substantially improved the prospects of the industry. The large scale manufacturing sector, especially the textile industry, is expected to grow by 8 percent to 9 percent in the next two years, the report said. —Agencies

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Pakistan Poised To Develop Close Economic Ties With Countries In Asia

BANGKOK, Thailand : April 29 (PNS) - Prime Minister Mir Zafarullah Khan Jamali said Wednesday Pakistan was all poised to develop strong economic and business ties with the countries in Asia as the future belonged to this region.

Speaking here at a dinner hosted in his honour by Pakistan's Ambassador to Thailand Mir Hussain Bakhsh Bangulzai, he said, Asia is fast turning into a trading centre of the future. He said there was a need for enhanced relatiions between the regional countries to gain from each others experiences and work together for the uplift of their masses. He said his visit was focused on having strong business and trade ties with the regional countries and he looked forward to invite the Thai businessmen to come and invest in Pakistan.

He said there were tremendous opportunities for business in the country and many lucrative sectors were open to joint ventures with leading multinationals. He said the completion of Gawadar port would open a gateway to the Central Asian Republics and serve as an economic hub. Jamali said there were huge unexplored mineral and natural resources, telecommunication and projects in Information Technology that were open for investment.

Prime Minister was appreciative of the economic progress Thailand has made in the recent past and said the credit goes to the government and the people for their commitment to make this happen. Jamali said Pakistan's vision East Asia was to work for the creation of a win-win situation in Asia. He said Pakistan as chairman of the seven nation region alliance of SAARC looked forward to forging intraregional alliances. Prime Minister was also appreciative of the hard work put in by ambassador Mir Hussain Bakhsh Bangulzai for forging strong ties with the Thai government. He said ambassador Bangulzai made his visit to Laos, Cambodia and Thailand fruitful. Ambassador Bangulzai said Prime Minister's visit will promote strong ties between the two countries. He said it would also go a long way in enhancing economic, political and bilateral ties with Thailand.

The dinner was attended by leading businessmen of Thailand and members of Prime Minister's delegation including Minister for Information Sheikh Rashid Ahmed, Minister for Petroleum Ch Nauraiz Shakoor, Minister for Privatisation Abdul Hafeez Sheikh, Secretaries of Foreign Affairs and Interior.

http://www.paknews.com/top.php?id=1&date1=2004-04-29

EU, Pakistan agree to fight drug trade, terrorism

BRUSSELS: The European Union concluded new agreements on Thursday with Pakistan that it said would lead to a "significant deepening" of relations, including in fighting drugs, unconventional weapons and terrorism.

The agreement and a parallel declaration were adopted following approval by the European Parliament on April 22.

Besides establishing "respect for human rights and democratic principles as an essential basis for co-operation," the agreement provides a framework for cooperation in trade, investment and development, the European Commission said.

It also "opens up possibilities for dialogue and cooperation in important new areas," ranging from environmental issues to drugs and money laundering. The commission said improving relations between Pakistan and India had helped make the agreement possible.

In the separate declaration, the EU said it would propose and develop "as appropriate" ways of cooperating with Pakistan on issues of weapons of mass destruction and of the fight against terrorism. EU foreign ministers, meeting last month after the Madrid train bombings, said that they would insist on cooperation in fighting terrorism in any new aid and trade agreement.

jang.com.pk

Pakistan’s Commonwealth membership
may be restored in May: UK envoy

KARACHI: British High Commissioner Mark Grant Lyall on Thursday hoped that Commonwealth meeting, scheduled on May 21, would lift suspension of Pakistan from organisation imposed after the military took over in 1999.

Speaking at a seminar on "Role of Britain in the Region" organised by Pakistan Institute of International Affairs (PIIA) at the library of the institute, British High Commissioner urged Pakistan and India to carry forward the present peace process to bring a change in poverty stricken region of world. He said that United Kingdom (UK) attached great importance to South Asian Region due to its geo-strategic position in the world.

"The UK has close relations with both nuclear armed countries, Pakistan and India, and is really
encouraged by recent thaw in the relations between two countries," he said.

He further said that UK has no regional policy for the region but has separate policies both for Pakistan and India based on different factors.

British High Commissioner, who spoke at length covering regional, international affairs besides invasion of Iraq and Afghanistan by allied forces and justified the invasion of Iraq as it was based on political grounds rather religious grounds.

He observed that UK’s interests in the region are multifaceted as these are based on historical context, size of region with two
nuclear-armed countries, trade partnership with countries of the region etc.

"The UK is really worried due to conflicting situation in the region as it is also providing breeding ground to extremism, however, recent SAARC summit in Islamabad has yielded great opportunities for India and Pakistan to reach a solution to all issues including core issue of Kashmir," he remarked.

Regarding Kashmir issue he acknowledged that UK shares some responsibility of Kashmir problem, but solution to this problem couldn’t be thrust outside. "It is Pakistan and India to find a just solution of problem incorporating aspirations of people of Kashmir."

"The UK can help both the countries to find a solution through political and diplomatic channels," he added.

Commenting on UK-Pak relations, the British diplomat opined that his government is encouraged by recent developments taken place in Pakistan, but still faces enormous challenges.

"Poverty, drug trafficking, extremism and some other problems are being faced by Pakistan, which need to be tackled effectively in order to strengthen the position, which Pakistan gained due to its contributions in war on terror," he said.

He observed that Pakistan has also gained much at internal front as holding of general elections in 2002 and resolution of LFO
issue have improved the image of country.

On bilateral relations between Pakistan and Britain, he said that bilateral development assistance has gone four times this year compared to few years back and this is primarily focussed on education, health and governance sectors.

"We are also considering to review licence procedure for sale of military equipment to Pakistan, relaxation on travelling advice and granting more visas to Pakistani students," he mentioned.

He said that UK supports President Gen Pervez Musharraf’s concept of "enlightened moderation" and stressed that other Muslim countries should also follow the same to weed out extremism and terrorist elements. British High Commissioner contradicted the
notions that these are based on theory of "clash of civilizations."

Admitting that security situation in Iraq and Afghanistan is fragile, he claimed that over 60 per cent population of Iraq has expressed their confidence that they are in a better conditions compared to Saddam Hussain’s era according to a recent polls.

Chairman PIIA Fateyab Ali Khan, S M Fazal, President Commonwealth Journalists, Farzana Shakoor, Assistant Professor NED University of Engineering also spoke on the occasion. British Deputy High Commissioner was also present on the occasion.

jang.com.pk

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Pakistan poised to achieve rapid economic growth: ADB

F.P Report ISLAMABAD: The Asian Development Bank has said that Pakistan is poised to achieve accelerated economic growth during the next fiscal due to the successful implementation of economic reforms and continued buoyancy in domestic and external sectors. The Bank said in its Annual Report “Asian Development Outlook 2004”, released in Islamabad on Thursday. The report said the economic recovery started in the second half of financial year 2002 and gained momentum in fiscal 2003. It said, the current account surplus increased sharply, foreign exchange reserves touched new heights, the overall fiscal deficit declined further and inflation remained low. Export growth was also the highest in over a decade, it maintained. Agriculture will get a lift from investment made in irrigation infrastructure and adoption of water saving techniques by farmers during the drought years will also enhance agricultural production. The report noted that there has been a sharp increase in investment in Pakistan’s largest textile industry. The large scale manufacturing sector especially the textile industry is expected to grow by 8 to 9 per cent in the next two years. The report noted that a sharp rise in worker remittances, as well as a decline in interest payments on foreign debt pushed up the current account surplus by 49.5 percent last year. The country’s external debt and liabilities also declined by one billion dollars to 35.5 billion dollars in fiscal year 2003.The government has implemented a comprehensive debt reduction strategy of paying off expensive outstanding liabilities. Releasing the Report at a news conference in Islamabad on Thursday, the ADB Country Director Marshuk Ali Shah said Pakistan’s economy is gaining higher rates of growth which will be reflected both in terms of employment and investment over the next couple of years. He said the growth will continue to accelerate. Replying to questions, he said private investment has been increasing rapidly over the last couple of years particularly in manufacturing sector. He said the emerging new sectors of telecommunications and electronic media have been really booming for the last one year.Shah said the Bank is supplementing government efforts on poverty reduction and employment generation. To a question, he said Pakistan has gone through very significant reforms in the banking sector and the non-performing loans as a percentage to total loans have been declining.

Pakistan to be introduced as a Progressive state: Jamali

BANGKOK: 'Role should be played for building the image of Pakistan as a progressive state' . This was said by the Prime Minister Mir Zafarullah Khan Jamali while inaugurating the foundation stone of Pakistani embassy in Hong Kong here on Friday.

He stressed the need to portray Pakistan as an ideal state for investment at the same time be conducive to help Pakistani citizens in their role to solve problems.

jang.com.pk

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President Asks To Ensure Dignity Of Labour

ISLAMABAD, Pakistan : May 01 (PNS) - President General Pervez Musharraf has called on the countrymen on the occasion of 'May Day' to work hard for the progress of Pakistan and urged them to follow Islamic injunctions to ensure the dignity and welfare of the working class.

"No covenant upholds the dignity of labour as firmly as does Islam," he said in his message, adding, the best way to ensure the welfare of the working class, therefore, was to follow Islamic injunctions. The President said the 1st of May is observed every year to pay tribute to the entire working class and to reaffirm commitment to uphold and enhance the dignity of labour.

"As we celebrate May day let us pledge that we will strive in accordance with the teachings of Islam, to rid our country of all discrimination against labourers and workers," he added. President Musharraf said for the first time in the country's history, workers have been given the right to participate in the decision-making process through the introduction of devolution of power at the grass-roots level.

The purpose of the devolution plan, he added, was to ensures representation to all segments of the society. "Workers and peasants under this devolution plan are elected on seats reserved for them in the local Government elections." He expressed the confidence that with this system in place, workers would now be able to contribute to their emancipation by participating in the political decision-making, ensuring well-being of not only the working class but other sections of the society as well.

The President said there was an urgent need for the aspirations of the employees and working class to converge in order to increase productivity and promote the well-being of all. "For without economic development of the country we cannot realize the objective of a modern dynamic and moderate Islamic welfare state," he added.

He urged all Pakistanis to work hard for the progress and prosperity of Pakistan and asked the employers to ensure good working conditions to their employees. The President said workers' skill and their terms of services would have to be improved, if Pakistan was to enter the WTO regime as a prosperous and self-respecting nation. He called on the people to resolve to eliminate all forms of exploitation and oppression.

While urging the employers to have an enlightened approach in their dealing with labourers, the President also called upon the workers to contribute fully towards increasing productivity. "May Allah be with us in our endeavours. Ameen".

http://www.paknews.com/flash.php?id=15&date1=2004-05-01


Pakistanis Urged To Respect Foreign Laws

BANGKOK, Thailand : May 01 (PNS) - Prime Minister Mir Zafarullah Khan Jamali Friday said the Pakistanis living abroad are real ambassadors of Pakistan and they must strictly abide by the laws and respect the customs of the country they live in.

Speaking here at the foundation stone laying ceremony of the Pakistan new embassy building, he said, every citizen whether a ruler or a common man is equal and must keep into account their country's image before taking any step. Jamali said he has directed the parliamentarians and the senior officials going abroad to visit the Pakistan embassy and see their working.

He said the government was aware of the problems being faced by the members of the Pakistani community and has directed the embassies to extend all facilities to them. The Prime Minister, who earlier visited, Laos, China and Cambodia, said his talks with their leadership and noticed that the Asian countries were now preparing to pool their resources for the economic uplift of their people.

Asia is now rising to meet challenges of the 21st century and compete with the developed nations of the world, he added. The Prime Minister stated that he had no doubt that future belonged to Asia. Jamali said Pakistan attached great importance to enhancing its relations with countries of South East Asia where Thailand enjoyed a pivotal status.

He underlined the cordial relations that existed between Pakistan and Thailand and said Islamabad now wished to concentrate on economic cooperation between the two countries with focus on enlarging the two-day trade volume.

http://www.paknews.com/flash.php?id=13&date1=2004-05-01

Pakistan Has One Of Asia's Most Qualitative Grain-Testing Laboratories

ISLAMABAD, Pakistan : May 01 (PNS) - Federal Minister for Food, Agriculture and Livestock Sardar Yar Muhammad Rind Friday said that Pakistan has one of Asia's most qualitative grain-testing laboratories.

He said, the rejected Australian wheat was declared sub-standard and live insects were found during the examinations. Talking to ARY television channel he said, the tests confirmed that the wheat was sub-standard and unfit for human consumption and the presence of some insects and Kernal Bunt were proved in it. Required gluten level was also missing in the wheat, he added.

The Minister said the quality of consignment was not according to the agreement. If the wheat with Kernal Bunt was imported in the country, it could prove very harmful for wheat crop, he said adding "Kernal Bunt is a cancer of wheat." He said, it could destroy more than 25-30 per cent wheat crop across the country which is about 5-6 million tons.

Responding to a question, he said the rejected wheat was accepted by those countries which were not known as wheat growing countries. He added, the wheat was sold to those countries with a rate of $ 178 per ton while the same was being given to Pakistan as $224.75. He also recalled that Pakistan had also rejected the consignment of sick Australian sheep, which were even being given free of cost.

http://www.paknews.com/flash.php?id=8&date1=2004-05-01

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Soomro For Joint Efforts To Move SAARC's People Away From Poverty Level

KARACHI, Pakistan : May 01 (PNS) - Chairman Senate, Mohammedmian Soomro has said that at this juncture it is demand of time and need of SAARC countries to move their people away from poverty level.

The developed countries, he observed, have entered into a new era of advancement, therefore it is necessary for SAARC countries to prepare themselves and unite for a joint struggle to lift themselves from the level under which they remained backward and unable to meet the challenges of this era.

In a message on the occasion of 3rd SAARC Diploma Engineers Conference which begins here Saturday, the Chairman Senate hoped that SAARC Diploma Engineers Forum, which enjoys the support of its technically trained manpower, can play a vital and effective role to achieve the target of elevating their people out of poverty level. He prayed that this Forum succeeds in the achievement of their target and wished all success to the Convention.

http://www.paknews.com/flash.php?id=5&date1=2004-05-01

Government to launch pension scheme: Budget 2004-05

By Our Staff Reporter

ISLAMABAD, April 30: The government plans to introduce a comprehensive pension scheme in the coming budget as part of its financial sector reforms and is likely to put together pensions and national savings scheme to launch a mutual fund, Dawn has learnt.

"We would be introducing a full pension scheme in the budget," Finance Minister Shaukat Aziz told reporters here on Friday but declined to give further details. He said the World Bank and International Monetary Fund (IMF) have commended Pakistan for introducing sweeping reforms in the banking and financial sector that have led to the soundness and expansion of the private sector in these areas.

Mr Aziz said the World Bank-IMF joint assessment report prepared this month had fully supported Pakistan's initiatives and noted that the country had achieved a high degree of transparency in the monetary and fiscal policy.

The two lenders had, however, asked the government to further consolidate privatization and legal reforms to ensure that no policy reversals take place and at the same time called for the need to introduce reforms in the insurance sector as well.

The two institutions noted that Pakistan had turned a weak and sinking banking sector into an efficient and growing private sector and increased competition has spread to SMEs, Agriculture and other innovative sectors.

He said the report also noted that financial soundness and great resilience has also led to a situation where Pakistan's banking sector fulfilled international standards. The two lenders had called for further consolidating the reforms process and appreciated the rationalization of national saving schemes.

He took strong exception to the recent annual Asian Development report that forecast a looming banking crisis in the Pakistan and said none of the issues raised by the report were Pakistan-specific.

He said that Pakistan's banking sector was one of the best performing sector and was internationally recognized and itself spoke volumes about the excellent performance. Replying on point to point as raised by the ADB report, Mr Aziz said that as far as the supervision and regulation is concerned, after SBP was granted autonomy in 1997 the supervisory capacity has been strengthened over the years.

Further, on the weak corporate governance of banking sector in Pakistan as stated by the ADB, Mr Aziz said it is not acceptable since it was one of the best and recognized by many international financial institutions.

Our regulations are as per best international practices and a loan, including agricultural loan becomes non-performing loan (NPL) when it becomes overdue by 90 days, as compared with India, where it is declared NPL after 180 days and for agriculture it is one year.

Challenging the allegation of low capitalisation ratios, the minister said that capital adequacy ratio is 12.1pc for commercial banks which is far higher than internationally required which is 8 per cent, therefore, reducing the chances of systematic risk.

He said there was no increase in bad loans/NPLs as stated by ADB report, since NPLs of the banking sector in Pakistan have been on a decline and as of December 2003 were lower by Rs24 billion against the level of December 2002. The NPLs have come down to 5.2 percent in 2003 on net basis from 10.3 per cent in 2001.

The Committee for Revival of Sick Industrial Units (CRSIU) has restructured loans worth Rs45.3 billion and helped revive 170 sick units by allowing waivers and write-offs up to January 31, 2004.

The Corporate and Industrial Restructuring Corporation (CIRC) has a success story, which had purchased loans worth Rs46.886 billion from the banks at a discounted price of Rs5.087 billion and auctioned off 87 units recovering Rs 2.822 billion.

http://www.dawn.com/2004/05/01/ebr1.htm

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Anti-money laundering law shortly: Shaukat

By Nadeem Malik

ISLAMABAD: Pakistan will enact laws against money laundering and benami practices to strengthen the financial sector, said Finance Minister Shaukat Aziz on Friday.

At a press conference, Aziz talked about the banking sector reforms, non-performing loans, next generation reforms and the legal environment governing the financial sector. "Our regulations are as per best international practices, and much stronger than the peer countries, like India and others," he said.

The minister said the cabinet has approved the draft anti-money laundering law, which would be placed before the House, once law division vets the act. He also announced the introduction of a banking ombudsman. Pakistan initiated banking sector reforms in 1997 with the help of multilateral institutions, as the financial sector entities were on the verge of bankruptcy after nationalization.

"Now almost 85 per cent of the banking system is in the private sector, with the Capital Adequacy Ratio (CAR) for commercial banks at 12.1 per cent at the end of 2003, far higher than the 8 per cent mandatory requirement under the international Basel Capital Accord," Aziz said.

The minister said the better supervisory and monitoring of the State Bank helped timely actions against the Bankers Equity, Indus Bank and Prudential Commercial Bank, and now against the Saudi Pak Commercial Bank. He said the corporate governance in the financial sector has improved due to transparent policies on appointment, powers and responsibilities.

Aziz also highlighted the performance of the Corporate and Industrial Restructuring Corporation (CIRC), an Asset Management Company (AMC), in containing the rising trend of NPLs. He said as of March 31, 2004, CIRC purchased loans worth Rs 46.9 billion from the banks at a discounted price of Rs 5.8 billion, and auctioned off 87 units, receiving Rs 2.82 billion. The Committee for Revival of Sick Units (CRSU) has restructured loans worth Rs 45.3 billion since 2000 by allowing waivers and write-offs to revive 170 sick units.

Similarly, under the SBP guidelines on loan write-off of 2002, 51,152 borrowers approached the banks/DFIs till February 29, 2004, to settle the defaulted loans worth Rs 89.6 billion. The banks/DFIs settled 49,816 cases, with total amount of Rs 41.97 billion. Total cash recoveries under the scheme have been Rs 3.3 billion so far.

The minister said the government is already working on the next generation of reforms, which would address most of these issues in the financial sector. APP adds: Aziz said Pakistan is now on top tier of the World Banking and Financial reforms and its policies are acknowledged internationally.

Regarding low capitalization ratios, Aziz said capitalization requirements for banks in Pakistan are as per international standards. Capital adequacy ratio for the commercial banks, he said, was 12.1% as of December 2003, which is far higher than basel capital accord required level of 8%. He added that SBP has also raised the minimum capital requirement to Rs. 1 billion (over $ 17 million), consequently a number of financially weaker and/or smaller banks have consolidated/merged, therefore, reducing the chances of systematic risk.

He said the expertise of the banks in risk management has improved through SBP imposed higher requirements in this area and through induction of professional risk managers and intensive training of the bank staff.

In 2003, he said, to make the regulatory framework more risk focused (for all types of risks) and to cover diverse areas of banking, three sets of Prudential Regulations for Corporate and Commercial banking, SME financing and Consumer banking were issued by SBP.

The SBP, he said, also has taken the initiative to prepare the Pakistani banks for basel capital accord II by issuing comprehensive guidelines on risk management in 2003. Furthermore, he said, SBP is finalizing the introduction of capital requirements, on Pakistani banks, to cover market risk.

Aziz said that NPLs of the banking sector in Pakistan have been on a decline and as of December 2003 were lower by Rs 24 billion against the level of December 2002. Aziz said on a flow basis, the situation is even better as gross NPLs, for the loans booked after year 1997, as a percentage of total loans, is far below 5%, which is the international standard.

On inadequate banking supervision and regulation, the minister stated that after being granted autonomy in 1997, SBP has considerably strengthened its supervisory capacity over the years. It, he said, has adopted various proactive tools of offsite supervision and onsite inspection and is complying with the international accepted core principles of banking supervision.

State Bank, he said, has also demonstrated its ability to resolve problems of distressed banks. The sharper supervision of banks/DFIs has earned SBP favourable comments from the World Bank, IMF and other central banks, he remarked.

Aziz said to ensure stability of the financial system and safeguard interest of the deposition, SBP is continuously monitoring the banks thereby ensuring that sudden bank failure does not lead to domino effect resulting in systemic crisis.

On improved corporate governance of banking in Pakistan, the minister said that the comment about weak corporate governance in the banking sector is no longer applicable to Pakistan. SBP, he said has issued detailed regulations and guidelines on corporate governance that comprehensively cover the broad areas of appointment, powers and responsibilities of the Board of Directors, CEOs and external auditors.

He added that a comprehensive Corporate Governance handbook has also been issued by SBP which followed it up by organizing a conference on corporate governance in October 2003 for the Board of Directors and CEOs of banks/DFIs.

SBP, he said, has also issued and enforced "Fit and Proper Test", a criteria for appointment of directors to the board of banks/DFIs, for the CEOs and for the senior management of the banks/DFIs.

jang.com.pk

Pakistan makes major inroad into South East Asia for economic co-operation

ISLAMABAD (May 02 2004): Pakistan has made "major inroad" into the countries of South East Asian region for economic co-operation, during the nine-day visit of Prime Minister Zafarullah Khan Jamali to Laos, China, Cambodia and Thailand, informed sources said here on Saturday.

They said Mr Jamali's tour of South East Asian countries from April 21-30, 2004 is "a major step" towards the realisation of Pakistan's Vision East Asia.

It envisages building strong co-operative ties with South East Asia states and Asean countries - Brunei, Cambodia, Indonesia, Lao, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam, while being closely associated with important regional processes in broader Asia-Pacific region.

Prime Minister Jamali's visit immensely contributed towards strengthening of co-operative links with this extremely important region, and Pakistan is hopeful to get membership of the prestigious Asian Regional Forum (ARF) (a grouping of 23 nations) at its meeting in Indonesia in June next.

The relevant ministries in Islamabad would now work out plans to take benefits from the visit of Mr Jamali. "Our thrust is economic and its benefits would also be political," sources said.

The sources said that Sultan of Brunei would pay a state visit to Pakistan this month, while Prime Minister of Singapore to visit Pakistan in June next.

The Presidents of Indonesia and Vietnam have paid state visits to Pakistan recently during which they had detailed discussions with President Pervez Musharraf and Prime Minister Jamali.

President Musharraf visited Thailand in year 2000, while the Thai premier undertook visit to Pakistan in 2002.

POLITICAL STABILITY: Mr Jamali and Federal Minister for Information Shaikh Rashid Ahmed, Minister for Privatisation & Investment Abdul Hafeez Shaikh and Petroleum & Natural Resources Minister Nouraiz Shakoor, who accompanied the prime minister on the tour, in talks with their counterparts spoke about political stability in Pakistan and continuation of economic and financial reforms.

They highlighted liberal investment regime in Pakistan and attracting international capital to flow into the country.

They briefed on the recent successful privatisation of Habib Bank, Telecom and award of cellular phone licences, and felt the momentum these have generated has to be built upon. It was a major breakthrough in terms of private sector financing of Pakistan's economic development.

Prime Minister Jamali addressed Business & Investment Conference focusing on making investment in Pakistan on April 26 in Hong Kong, attended by prominent businessmen and investors from China, Pakistan, some from South Korea, Singapore and Malaysia, besides, representatives of international fund managers. The Privatisation Ministry would hold another such conference in London on May 12, 2004.

The sectors available for foreign investment in Pakistan include oil, gas, telecom, food processing, electronics, infrastructure, construction material, textile, banking and commercial services and IT.

Copyright Pakistan Press International press

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