Pakistan Economy: News & Discussion

[pankaj nema]

Balance of payments worsens: Pakistan could knock at IMF’s doors in April

 

[AMCA]

Pakistani and Chinese workers at the site of a New Silk Road project in northern Pakistan. Photo: AFP
ASIA UNHEDGEDREAL-TIME INTEL ON WHAT MOVES MARKETS
Pakistan financial woes exposing more cracks in Belt and Road?
Key country in China’s grand plan sees finances and currency in disarray; some are blaming the Belt and Road Initiative
By ASIA TIMES STAFFMARCH 29, 2018 3:38 AM (UTC+8)

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The China-led Belt and Road Initiative (BRI) is putting strain on Pakistan’s public finances and currency, some are saying, casting a shadow over Xi Jinping’s signature connectivity plan.

Jonathan Rogers writes in The Asset on potential hiccups for the grand infrastructure scheme.

“[Pakistan’s] current account worsened substantially last year on the back of a sharp increase in imports due to trade activity related to the Belt Road initiative.

“This in turn has put pressure on the Pakistan rupee, which was the worst performer in the Asian currency complex last year and which has experienced downside revaluation pressure since December, with two sharp legs down met with a depletion of the central bank’s foreign exchange reserves.

…

“Pakistan had signed up to Belt Road-related projects to the tune of US$60 billion, including plans to build power plants and a railway linking Western China with the Pakistani Indian Ocean port of Gwadar. But political dial back prompted the Pakistani government to withdraw from a joint venture with China to develop the Diamer-Bhasha dam in Kashmir last November.

“That pullback apparently came as the Pakistan authorities baulked at the use of Chinese companies and labour that was stipulated under the terms of the Belt Road agreement. Above and beyond the politics, the economics would strain Pakistan’s balance of payments given that the bulk of the work would appear on the import side of the country’s trade balance with China.”

Pakistan is not the only BRI country that has pulled back from Chinese-led projects. Nepal reportedly scrapped a US$2.5 billion deal to build a hydroelectric dam with the Chinese state company China Gezhouba Group. A new administration abandoned the plan last November, saying the deal was signed without an open tender process, which is required by law.

“Full transparency – through competing public tenders – of the adequacy, suitability and quality of the Chinese equipment being used,” The South China Morning Postreported last November, “could soon become a serious problem.”

In Pakistan, security and local politics also loom over potential projects. China reportedly pulled the plug on US$1 billion worth of road projects late last year, a decision made amid local political infighting.

Pulling money from projects is “China’s way of conveying a diplomatic yet strong message to the Pakistanis: We will pay, but only on our terms,” the European Foundation for South Asian Studies, an Amsterdam-based think tank, was quoted by CNBC as writing. The decision was “a temporary punitive step to affirm control,” according to the think tank.

“Pakistani ministries charged with carrying out the projects have incurred delays because of infighting … Concerns that the project bypasses Pakistan’s poorer regions and will mainly benefit the financially-strong province of Punjab has made politicians argue,” the group said.

RBP

Security risks are also lurking below the surface. China has reportedly been discreetly holding talks with separatist groups in hopes of protecting infrastructure projects.

 

[Mikesingh]

Fastest Depleting Dollar Reserves in Asia to Slump Even Further

• Pakistan’s foreign reserves may drop below Cambodia’s
• Pakistan devalued currency twice in four months

Pakistan is depleting its dollar reserves at the fastest pace in Asia and may soon have a buffer that’s smaller than Cambodia, an economy that’s less than a 10th of its size.

Reserves have dropped by about a fifth in the past year to reach $13.5 billion in February, while in Cambodia they’ve increased a third to $11.2 billion in January, according to data from the International Monetary Fund. Pakistan’s reserves are expected to drop as much as $2.2 billion by June, according to Insight Securities Pvt.

Pakistan is facing a balance of payments crunch. Its current-account deficit has ballooned by 50 percent in the past eight months to $10.8 billion, fueled by rising imports. With reserves coming under pressure, authorities devalued the currency for the second time in four months last week.

“There is no easy fix,” said Uzair Younus, a South Asia director at Washington-based consultancy Albright Stonebridge Group LLC. “The solution lies in improving the business climate” to attract greater foreign direct investment inflows and implementing reforms to make exports more competitive globally, he said.

https://www.bloomberg.com/news/arti...dollar-reserves-in-asia-to-slump-even-further

He says that the solution lies in "improving the business climate” to attract greater foreign direct investment inflows. But with the condition that Pak is in today, who is going to invest in that failing state? They've earned not accolades but brickbats from the world at large for their sponsorship of terrorism. The security situation and economy is pretty bad so why would anyone in his right mind even contemplate doing business there?

Unless and until the Paki Establishment turns its ship around, things are going to get a lot worse. The present conversion rate is $1 = Rs 116 PKR. Was Rs 110 PKR last week. Prices of commodities have gone up by 4% to 7%!

If that isn't good news, what is?? :biggrin2:

 

[Suryavanshi]

Fastest Depleting Dollar Reserves in Asia to Slump Even Further

• Pakistan’s foreign reserves may drop below Cambodia’s
• Pakistan devalued currency twice in four months

Pakistan is depleting its dollar reserves at the fastest pace in Asia and may soon have a buffer that’s smaller than Cambodia, an economy that’s less than a 10th of its size.

Reserves have dropped by about a fifth in the past year to reach $13.5 billion in February, while in Cambodia they’ve increased a third to $11.2 billion in January, according to data from the International Monetary Fund. Pakistan’s reserves are expected to drop as much as $2.2 billion by June, according to Insight Securities Pvt.

Pakistan is facing a balance of payments crunch. Its current-account deficit has ballooned by 50 percent in the past eight months to $10.8 billion, fueled by rising imports. With reserves coming under pressure, authorities devalued the currency for the second time in four months last week.

“There is no easy fix,” said Uzair Younus, a South Asia director at Washington-based consultancy Albright Stonebridge Group LLC. “The solution lies in improving the business climate” to attract greater foreign direct investment inflows and implementing reforms to make exports more competitive globally, he said.

https://www.bloomberg.com/news/arti...dollar-reserves-in-asia-to-slump-even-further

He says that the solution lies in "improving the business climate” to attract greater foreign direct investment inflows. But with the condition that Pak is in today, who is going to invest in that failing state? They've earned not accolades but brickbats from the world at large for their sponsorship of terrorism. The security situation and economy is pretty bad so why would anyone in his right mind even contemplate doing business there?

Unless and until the Paki Establishment turns its ship around, things are going to get a lot worse. The present conversion rate is $1 = Rs 116 PKR. Was Rs 110 PKR last week. Prices of commodities have gone up by 4% to 7%!

If that isn't good news, what is?? :biggrin2:

Does this mean we can smuggle beautiful Paki girls for Lower prices?

 

[Mikesingh]

Does this mean we can smuggle beautiful Paki girls for Lower prices?

If you're smart you can get them for free!

 

[Suryavanshi]

If you're smart you can get them for free!

We can use Paki girls to fix Indias sex ratio

 

[Flame Thrower]

We can use Paki girls to fix Indias sex ratio

Chinese will give tough competition....

Remember "Chalay thay Saath"

 

[Butter Chicken]

Number of labourers going to Saudi Arabia drops

ISLAMABAD: The number of Pakistani labourers recruited by SaudiArabian employers dropped by 11 per cent to 460,000 in 2016 despite the fact that the kingdom has remained the busiest corridor for Pakistani migrants higher than in any year since 2005.

Nonetheless, in 2017, Bangladesh appears to have replaced Pakistan as the main source of labour force to Saudi Arabia, the Asian Development Bank (ADB) says in a new report, ‘Labour Migration in Asia’.

This downward trend is likely to continue since partial figures up to October 2017 indicate only 450,000 departures for overseas employment from Pakistan. The increase in Bangladeshi workers going to Saudi Arabia can be attributed to the end of a six-year ban on recruitment, which was lifted in mid-2016.

 

[Butter Chicken]

More foreign loans only way to sustain reserves: Pak MOS for Finance

The government plans to take commercial loans and in addition it has sent requests to friendly countries to place more deposits in the State Bank of Pakistan, according to sources in the Ministry of Finance. Friendly countries have already placed $1.7 billion as deposits with the central bank under currency swap arrangements, which are part of the $11.8 billion gross official reserves.


In its latest report, the IMF said that Pakistan’s net official foreign currency reserves were negative $724 million as of mid-February. It has estimated Pakistan’s gross financing requirements at $24.5 billion for this fiscal year.


Rana Afzal defended high debt levels and said that the government did not have an option but to borrow to run its affairs. He said that high spending on security was also the reason behind the growing debt burden.

 

[lcafanboy]

He said that high spending on security was also the reason behind the growing debt burden.

So basically India's plan of bankrupting Porkistan through limited war/hostilities is working...... A few more years of increased hostilities with IAF & IN too getting involved in some limited form will simply make it unbearable for porkies and we could see a repeat of USSR, albeit this one being a dangerous one as we could see a Syria like situation in our neighborhood........

 

[Kalki_2018]

Which is exactly what we want. Situation is syria or Libya have not affected Egypt, Jordan, Saudi or Turkey at all. They have made a profit by stealing and selling syrian oil. Just mine the IB, LOC and AGPL and let porkis slug it out for a few decades.

 

[darshan978]

One image says every thing haha

 

[Mikesingh]

Rana Afzal defended high debt levels and said that the government did not have an option but to borrow to run its affairs. He said that high spending on security was also the reason behind the growing debt burden.

And yet.....

Pak Eyeing Russian Tanks, Anti-Aircraft Missiles

Pakistan is in talks with Russia to buy air defence hardware and main battle tanks that Russia has been exporting to other nations, Pakistan's defence minister Khurram Dastgir Khan has told Russia's Sputnik news agency. The Pakistani minister claimed in the interview that his country has been working to increase cooperation with Kremlin.

"We are interested in T-90 tanks and it is not going to be a one-time purchase but it is going to be a long-term commitment," Mr Khan said.

Though the Pakistani minister did not say what kind of air defence missile Islamabad is looking to buy from Russia, there has been speculation that Pakistan may request hard to get hold of the long-range S-400 air defence missile.

https://www.ndtv.com/india-news/pak...rcraft-missiles-which-india-also-uses-1834253

Oh wow! These frikkin Porkies talk like as if they are flush with funds and an economic superpower that they can afford these weapons which they can't, even if they eat grass for the next 30 years!

And the S-400 to Pak? Lol! Smoking adulterated Afghan weed that Pakis are in the habit of chewing makes for grandiose delusions!

 

[undeadmyrmidon]

And yet.....

Pak Eyeing Russian Tanks, Anti-Aircraft Missiles

Pakistan is in talks with Russia to buy air defence hardware and main battle tanks that Russia has been exporting to other nations, Pakistan's defence minister Khurram Dastgir Khan has told Russia's Sputnik news agency. The Pakistani minister claimed in the interview that his country has been working to increase cooperation with Kremlin.

"We are interested in T-90 tanks and it is not going to be a one-time purchase but it is going to be a long-term commitment," Mr Khan said.

Though the Pakistani minister did not say what kind of air defence missile Islamabad is looking to buy from Russia, there has been speculation that Pakistan may request hard to get hold of the long-range S-400 air defence missile.

https://www.ndtv.com/india-news/pak...rcraft-missiles-which-india-also-uses-1834253

Oh wow! These frikkin Porkies talk like as if they are flush with funds and an economic superpower that they can afford these weapons which they can't, even if they eat grass for the next 30 years!

And the S-400 to Pak? Lol! Smoking adulterated Afghan weed that Pakis are in the habit of chewing makes for grandiose delusions!

Pakis are taking their begging bowls everywhere. Pay with what? Paki women's @$$? Even Chinese convicts can smell them miles away!

 

[Butter Chicken]

In absence of payment mechanism, Pakistan loses Iran market

The absence of banking channels cast a pall over Pakistan-Iran trade, which nosedived from $1.16 billion in 2009-10 to $318.69 million in 2015-16. Pakistan’s exports to Iran fell from $207.19 million to $35.48 million while imports from Iran decreased from $962.13 million to $283.21 million over this period, according to data compiled by the Pakistan Bureau of Statistics.

Not surprisingly, the bilateral trade has not taken off in the wake of the lifting of sanctions on Iran. In 2016-17, the bilateral trade was $300 million including $29 million of exports from Pakistan and $271 million of imports from Iran.

Despite the sanctions, some other Iran’s trading partners, notably India, were able to put in place an alternative payment mechanism and thus they were able to sustain their trade with Iran.

 

[Indibomber]

Pakis are taking their begging bowls everywhere. Pay with what? Paki women's @$$? Even Chinese convicts can smell them miles away!

True but what i see that its all a ploy to make US pay up. Afghanistan is a battle ground which neither US or Russia want to loose (Russkies they want revenge). If Pakistan agrees to stop american arms getting into Afghanistan to NATO/American forces russians will provide them some weapons.
Americans will have only 2 choices, since there is no other way to reach Central Asia. They cant go through Turkey, Afghanistan or Iran.
1) Pay through the nose to bakis
2) Back out of Afghanistan.

India has to play the game really well to ensure we do not have to put our boots on the ground and ensure that bakistan breaks up due to civil war. I hope the oil prices dip to 2016/2017 ($40 a barrel) level so that Russian economy is not able to support bakis in anyways and Indians tie them with multiple defense deals or business deals so that Russians are forces to stay on our side. I expect India to engage China so that we are able to buy time and raise internal troubles for bakis..

Sadly enough i haven't heard of any major blasts/killing for few months now. hope to hear news on blasts in karachi, islamabad and pindi..

PS: not sorry being so nasty about bakis...i have no love/kindness for any baki and they all are potential suicide bombers of tomorrow.

 

[Mikesingh]

True but what i see that its all a ploy to make US pay up. Afghanistan is a battle ground which neither US or Russia want to loose (Russkies they want revenge). If Pakistan agrees to stop american arms getting into Afghanistan to NATO/American forces russians will provide them some weapons.
Americans will have only 2 choices, since there is no other way to reach Central Asia. They cant go through Turkey, Afghanistan or Iran.
1) Pay through the nose to bakis
2) Back out of Afghanistan.

India has to play the game really well to ensure we do not have to put our boots on the ground and ensure that bakistan breaks up due to civil war. I hope the oil prices dip to 2016/2017 ($40 a barrel) level so that Russian economy is not able to support bakis in anyways and Indians tie them with multiple defense deals or business deals so that Russians are forces to stay on our side. I expect India to engage China so that we are able to buy time and raise internal troubles for bakis..

Sadly enough i haven't heard of any major blasts/killing for few months now. hope to hear news on blasts in karachi, islamabad and pindi..

PS: not sorry being so nasty about bakis...i have no love/kindness for any baki and they all are potential suicide bombers of tomorrow.

India hopes Russia wouldn’t Supply Weapons to Pakistan and harm its interests

India today hoped that Russia would not do anything to harm its interests as it steps up ties with Pakistan, underlining that New Delhi and Moscow enjoyed a multidimensional relationship based on mutual trust and strategic convergence.

Underlining that India and Russia have the same objectives in Afghanistan, Saran said India wants to help Afghanistan build a safe, secure and stable society, to defeat the evil of terrorism and eradicate the threat from narcotics.

http://defencenews.in/article/India...ons-to-Pakistan-and-harm-its-interests-547512

Except for a few choppers and minor sundtry defence equipment, Russia will never like to ruffle India's feathers by giving the Porkies big ticket items thereby losing the billion-dollar Indian arms market.

 

[Butter Chicken]

Trade deficit widens to $27.3 billion even as Pakistan records higher exports

ISLAMABAD: Pakistan exported goods worth $2.23 billion in March, a figure the Ministry of Commerce said was the highest level in four years, reflecting a massive year-on-year increase of 24.4% or $437 million when compared with the amount in March 2017.

However, the trade deficit still widened 17.3% year-on-year to $27.3 billion in the cumulative nine-month period, surpassing the amount projected for the entire fiscal year, suggesting that worries for economic managers is far from over.

 

[Guest]

Just look at this.

 

[F-14B]

Just look at this.

View attachment 24217

What's so astonishing about it the guy on the right is the master the guy on the left is the slave as simple as that