TC May-Jun 2021 Issue

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www.tradechronicle.com TRADE CHRONICLE Vol 68 -Issue Nos. 5 & 6 - May - Jun. 2021 Rs. 250/-

ESTABLISHED IN MARCH 1953

68 th - YEAR OF PUBLICATION

TRADE CHRONICLE

PAKISTAN OLDEST MONTHLY MAGAZINE OF COMMERCE, TRADE, INDUSTRY & PUBLIC AFFAIRS

Our prime objective is

to revive our economy

and steer Pakistan onto

the path of becoming a

stronger economy

Federal Budget 2021-22

has mixed incentives for

industries

Finance Minister

Shaukat Fayyaz Ahmed Tarin, presenting

Federal Budget 2020-21, in Parliament on June 11.

Provinces Budget

Finance Minister

Hashim Jawan Bakht

presenting Punjab budget

Chief Minister

Syed Murad Ali Shah

presenting Sindh budget

Finance Minister

Taimur Saleem Khan Jhagra

presenting KPK budget

Finance Minister

Zahoor Ahmed Buledi

presenting Balochistan budget

• Tariq Glass Industries continues

• General Tyre evolves to reiterate

to expand its production capacity

its market leadership through

in Pakistan TRADE CHRONICLE - May - Jun - 2021 - Page # technological advancements


MG

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TRADE CHRONICLE - May - Jun - 2021 - Page #

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www.tradechronicle.com Vol. 68 Issue Nos. 5 & 6 May - Jun 2021 Rs. 250/-

TRADE CHRONICLE

PAKISTAN OLDEST MONTHLY MAGAZINE OF COMMERCE, TRADE, INDUSTRY & PUBLIC AFFAIRS

Circulation Audited by

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CONTENTS

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editorial

• Bird’s eye view on the Federal Budget 2021-22

• The Paper & Paperboard industry urges rationalization of import tariff

article & feature

• A joint statement issued on the successful visit of PM Imran Khan to KSA

• Pakistan and China celebrate 70 years of friendship

By Mustafa H Sayed

• Federal Budget 2021-22 has mixed incentives for industries

A Chronicle Report

• Balochistan presents Rs584.1bn budget

• Punjab government presents Rs2.65 trillion budget for 2021-22

• The Sindh government presents Rs1.48trn budget for the province

• KPK unveiled a Rs1.118 trillion budget for the fiscal year 2021-22

• A Pragmatic view of Pakistan’s budget 2021-22

By Dr. Muhammad Nawaz Iqbal

• Salient feature of Pakistan Economic Survey FY21

• Tariq Glass Industries continues to expand its production capacity in Pakistan

A Chronicle Report

• RCET policy helps in boosting textile export in Pakistan

By Saddam Hussein

leather industry

• leather exports from Pakistan continue to decline in 9MFY21

• Bangladesh leather industry sees significant growth despite the negative impact

of Covid 19

• Indian leather exports continue to contract in outgoing fiscal year FY21

• Federal Budget FY22 offers cheap raw materials for the footwear industry in

Pakistan

ports & Shipping

• Tariq Haleem hails the appointment of Mahmood Moulvi as Special Assistant to

PM for Maritime Affairs

• Shipping agents seek amendments to trans-shipment rules

• ‘PQA’s reserve fund crosses $700mln’

• New shipping service commences regular calling at Hutchison Ports Pakistan

• Anomalies in clearance process: APCAA suggests amendments in budget measures:

chairman

• ZODIAC Terminal Operating System delivers upgrades to Aden Container Terminal

regular features

• Automobile News, Banking & Insurance News, Cement Industry,

• People Events, Telecommunication News, Travel World, Steel & Allied Industry

TRADE CHRONICLE - Mar - Apr - 2021 - Page # 5


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We begin with the name of Allah the Magnificient

Bird’s eye view on the Federal Budget 2021-22

The Finance Minister, Mr Shaukat Tarin, presented the third budget on behalf of

the government of Pakistan Tehreeke Insaf (PTI) or Pakistan Justice Movement

for Fiscal Year July 1, 2021, to June 30, 2022, amidst the usual uproar by the

opposition parties against budget speech at the Parliament in Islamabad on June

11. The total outlay is set at Pakistani Rupees 8.5 trillion and the growth target

at 4.8% of Gross Domestic Product (GDP). It may not be easy to encompass the

whole budget in a short note, nor we claim to be top economic experts, except

to write on some fundamental matters on the budget, which had already been

debated in media.

FROM THE

EDITOR’S

DESK

Also, renowned experts have challenged a high income envisaged in the budget

to be unrealistic and unachievable, with shortfalls expected in meeting the set

budgetary targets. They may result in a series of deficits in many fields, prompting

a series of undesirable amendments in the budget disagreed by the business

community in general.

For example, the budget shows ‘Tax Revenue (by Federal Bureau of Revenue or

FBR) of Pak Rs 5,829 billion’ whereas, until May 29, 2021, the FBR had collected

Rs 4,143 billion in 11 months. That means the FBR may end up collecting around

Rs4,500 billion this year. How can the FBR collect a wholesome 30 per cent more

next year? If the FBR collects 15 per cent more next year, it will come to Rs5,000

billion or so. That would leave a gap of Rs800 billion – a serious question raised

by economic experts. If the set target could not be achieved, it would either open

the door for levy of new taxes, cut in subsidies and lesser funds for development

projects and soft borrowing of huge loans from friendly countries, etc., we believe.

However, contrary to the above remarks, this budget’s concrete recommendations

this year 2021-22 align with next year’s growth projections. The government rolled

out necessary relief measures for several sectors, observed research houses in

their initial impressions and termed fiscal measures positive for the industries.

ABDUL RAB SIDDIQI

One eye-catching relief proposal in the Finance Bill 2021-22 was a series of

incentives for the auto industry - reducing FED and GST for locally assembled

ICE/regular cars (up to 850cc). Later, the finance minister announced that the

incentives would cover passenger cars up to 1,000cc engine displacement.

First, however, a robust mechanism is required to check and balance car prices

because manufacturers jack up prices in the disguise of dollar vs rupee parity.

On a negative note, some industries published appeals in the local media, pointing

to ignorance of some related budget recommendations they believed went

against their ambitions. The oil refineries, dairy sector, larger steel producers,

tea importers, cement manufacturers and a few more sectors, institutions and

industries were unhappy with the finance bill suggestions. Many demanded

removing anomalies and aggressive tax measures and withdrawal of incentives

given to remote areas. They also demanded the withdrawal of concessions for

setting up industry in Federally Administered Tribal Areas (FATA) and Provincially

Administered Tribal Areas (PATA).

Meanwhile, addressing a post-budget press conference, the Federation of

Pakistan Chambers of Commerce & Industry (FPCCI) and several other chambers

have vehemently rejected section 203A that authorizes a tax officer to arrest a

taxpayer. “This will increase harassment, bribery and blackmail,” the chambers,

constituting the organized economic lifeline of Pakistan, remarked. In addition,

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the clause of mandatory invoice

in the imported containers and

the banning of smuggled goods

in shops – also becomes the

bone of contention between

the government and people in

business.

Later, some adjustments were

made in finance bills after the

widespread criticism in public/

industrialists. The Federal Finance

Minister Shaukat Tarin fine-tuned

the budget and clarified that there

would be no tax on internet usage

and SMS. However, 75 paise

would be collected in tax for every

mobile phone call exceeding five

minutes. In addition, he said, the

tax on milk had been removed, and

17 per cent tax on gold and silver

was being reduced to one per cent

and three per cent, respectively.

However, he added that the 17 per

cent tax would remain in place for

the value addition of the metals.

Likewise, Tarin said, the tax on

poultry products and cattle feed

The Paper & Paperboard industry

urges rationalization of import tariff

Pakistan has the highest tax

on paper globally and one of

the lowest literacy rates. The

Pakistan Association of Printing

& Graphic Industry (PAPGAI) and

the All Pakistan Paper Merchants

Association (APPMA) have

urged the government to reduce

customs duty and rationalize

the import tariffs on paper and

paperboard. A cursory look at

import and production data of PBS

reveals that paper & paperboard

& manufacturing consumption

is increasing in Pakistan,

besides a significant amount of

foreign exchange spent on its

import. Therefore, we think the

sector needs the government’s

exceptional attention to make its

trade cheaper and increase its

local production.

The import of paper & paperboard

saw a growth of 9.18 % in dollar

value and 8.66% in quantity

during the first eleven months of

was being reduced from 17 per

cent to 10 per cent, and the tax on

textile products for retailers had

been decreased from 12 per cent

to 10 per cent. He further clarified

that no tax was imposed on wheat

and wheat byproducts. These

revisions in tax proposals would

bring down the rising inflation, we

believe.

He further announced that taxes

initially imposed on IT and

e-commerce platforms had been

withdrawn, a widely welcomed

decision. He added that the income

tax, which was increased to 35

per cent under the construction

package, had been reduced to 20

per cent.

Tarin said Pakistan was facing

major structural issues in the

power sector. The government had

to pay Rs900 billion on account of

capacity payments for electricity

that was not being utilized. To

overcome this, the donor agency

the outgoing financial

year 22021. However,

in Pak rupees, the

imports account for

a growth of 11.47% due to the

depreciation of rupees against the

dollar during this period of July

–May 2021. Pakistan imported

438,655 tonnes of paper and

paperboard at USD 400 million

against 403,697 tonnes at $ 364

million in FY21.

The growth was also observed in

the local production of paper and

paperboard as it reached 616,467

tonnes, a nominal gain of 1.92

% YoY basis but commentable,

we consider. A valid suggestion

from stakeholders to reduce

customs duty on paper produce

in Pakistan to 10% and that paper

not produced in Pakistan should

have 5% duty. Due to the unlimited

continuation of abnormal tariffs,

printed materials including books,

catalogues, packing materials,

literary materials etc. are imported

at 3% customs duty; whereas, the

paper and paperboard (H.S code

had asked to raise the power

tariff. But the prime minister had

been committed that there would

be no increase in the electric

rates. He assured that the circular

debt would begin to decrease

in the coming year as measures

were taken to reduce losses and

increase the recoveries of bills – a

sigh of relief for the stakeholders.

We hope that, as a viable solution

to achieve the high income

suggested in the budget and to meet

expenditures without progresshalting

deficits, the government

would speed up the Privatization

programme to complete the set

targets, including PKR 252 billion.

The other challenges would be

to meet power sector circular

debt, high inflation, makeup job

losses in the aftermath of Covid,

balance commodity operations,

and successful negotiation

with the IMF. Last but not least,

procurement of Vaccines for every

Pakistani.

4802 & 4810) imported by the

printing and packaging industry is

charged with 27 % customs duty

as well as anti-dumping duty.

The continuation of an unbalanced

tariff and the fact that other

regional countries have managed

to establish equally well-organized

printing units has led to increasing

imports of books -- including Urdu

books prescribed in Pakistan’s

schools and colleges -- from

Malaysia, Singapore, Indonesia,

and China, which were once

printed locally.

International printing industries

derive benefits of $ 900 billion

markets, essentially consumed by

Singapore, Malaysia, China and

UAE; even though our printing

industry is far cheaper but heavy

customs duty, additional customs

duty and anomalous taxes are the

major factors that confined and

kept us behind without effective

entry into the $900 billion export

market – a well-presented plea, we

think.

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A joint statement issued on the

successful visit of PM Imran Khan to KSA

The following is the joint statement

issued on the visit of the Prime Minister

of Pakistan Imran Khan to the Kingdom

of Saudi Arabia (KSA):

On the kind invitation, extended by

His Royal Highness, Crown Prince,

Deputy Prime Minister and Minister

of Defence, the Prime Minister of the

Islamic Republic of Pakistan, His

Excellency Mr. Imran Khan paid an

official visit to the Kingdom of Saudi

Arabia on 7-9 May 2021, corresponding

to 25-27 Ramadan 1442/AH. His

Royal Highness, the Crown Prince,

warmly welcomed the Prime Minister of

Pakistan.

The two leaders reaffirmed the

historical and fraternal ties between

the Kingdom of Saudi Arabia and the

Islamic Republic of Pakistan, reviewed

all facets of bilateral cooperation

and discussed regional and

international issues of mutual

interest. The two sides discussed

ways to strengthen relations of

the two brotherly countries in all

fields, and agreed to intensify

contacts and cooperation

between government officials

and the private sector in the

two countries with the aim of

promoting bilateral relations to

the benefit of both countries.

His Excellency Prime Minister

Imran Khan praised the leadership

role of the Custodian of the Two Holy

Mosques King Salman bin Abdulaziz

Al Saud in promoting Islamic unity,

and the positive role of the Kingdom in

resolving the issues facing the Islamic

world, as well as its endeavours for

regional and international peace and

security.

The Prime Minister recalled his visits

to the Kingdom in 2018 and 2019, as

well as the historic visit of His Royal

Highness, the Crown Prince, Deputy

Prime Minister, Minister of Defence

to Pakistan in February 2019, during

which the two leaders jointly announced

the launch of the Saudi-Pakistan

Supreme Coordination Council, to

further enhance bilateral cooperation

based on mutual trust, benefits and

common interests of the two countries.

The Crown Prince assured the Prime

Minister of the Kingdom’s continued

s u p p o r t

to Prime

Minister’s

vision to

transform Pakistan into a modern

developed and welfare state.

The two sides discussed ways to

strengthen and enhance economic and

trade relations by exploring areas of

investment and opportunities available

in light of the Kingdom’s 2030 vision

and Pakistan’s development priorities

emanating from a shift from geo-politics

to geo-economics. The discussions also

focused on increasing cooperation in

other fields, including energy, science,

technology, agriculture and culture.

Both sides expressed satisfaction at

existing cooperation in bilateral military

and security relations, and agreed

to further augment collaboration and

cooperation to achieve mutually agreed

goals.

The two leaders also discussed

issues pertaining to the Islamic

world. They stressed the need for

concerted efforts by the Muslim

countries to confront extremism and

violence, reject sectarianism, and

strive to achieve international peace

and security. They also stressed the

importance of continuing joint efforts

to combat terrorism, in all its forms and

manifestations. They reaffirmed that

terrorism cannot and should not be

associated with any religion, nationality,

civilization, or ethnic group.

In the constructive spirit of discussions,

the two sides reaffirmed their full

support for all the legitimate rights

of the Palestinian people, especially,

their right to self-determination and

establishment of their independent

state with pre-1967 borders and East

Jerusalem as its capital, in accordance

with the Arab Peace Initiative and

relevant UN resolutions. They also

expressed their support for political

solutions in Syria and Libya, as well as

the efforts of the United Nations and its

envoys in this regard.

The two sides also stressed the

importance of supporting efforts to

reach a comprehensive political solution

to the conflict in Yemen based on the

Gulf Initiative and its implementation

mechanism, the outcomes of the

comprehensive national dialogue,

and the relevant Security Council

resolutions, including Resolution

(2216). They condemned the attacks of

terrorist groups and militias, including

Houthi militias, by ballistic missiles and

drones on the territory of the Kingdom of

Saudi Arabia against vital installations

and civilian objects. They expressed

serious concern at the threats posed

to the security of oil exports and the

stability of energy supplies, which

was vital for the progress and

development of the region and

its peoples. The Prime Minister

praised the role of Kingdom of

Saudi Arabia for the resolution

of crisis in Yemen which aims

at achieving peace and security

in Yemen which will result in

prosperity and development of

the region and its people.

Discussing the situation in

Afghanistan, the Crown Prince

acknowledged Pakistan’s

facilitative role in the Afghan

peace process. The two sides,

underlining that an inclusive, broadbased

and comprehensive political

settlement is the only way forward,

urged the Afghan parties to realize

the historic opportunity for achieving a

political settlement in Afghanistan. The

two leaders agreed to continue mutual

consultations on the Afghan peace

process.

Pakistan and Saudi Arabia agreed

to continue supporting each other at

multilateral fora. They agreed to further

deepen coordination and cooperation

to safeguard mutual interests and

uphold the principles of fairness and

justice. The two sides also stressed

the importance of the commitment

by all States to the United Nations

Charter, the principles and decisions

of international legitimacy, as well as

adherence to the principles of good

neighbourly relations, respect for the

Contuined on page # 16

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Pakistan and China celebrate

70 years of friendship

By Mustafa H Sayed

Pakistan and China will today – May

21 – celebrate 70 years of what has

been a model bilateral relationship.

The Pakistan-China relationship has

been re-enforced by a consistent policy

of Pakistan towards China, regardless

of who is in power, supporting China

on its key international issues and

core interests such as Taiwan, Tibet,

Xinjiang, Hong Kong and South China

Sea.

Similarly, China has been Pakistan’s

voice in the Security Council, supporting

Pakistan’s position on Indian Occupied

Kashmir, as well as on Pakistan’s fight

against terrorism, core interests in

Afghanistan, and more recently in the

fight against the Covid-19 pandemic.

By making CPEC the flagship project

of the BRI, China gave a vote of

confidence in Pakistan’s economy

by investing a mammoth $62 billion.

While there is much to celebrate in

the ‘all-weather friendship’ between

the two countries, it is also an

opportune moment to pause and

reflect on how this relationship can

be optimized, and how the next

decades should (or could) look like

for Pakistan.

Since the start of CPEC in 2013,

Pakistan has received investments

in roads, energy, the Gwadar Port

– as well as grants in the socioeconomic

sphere that involve clean

water, vocational training institutes and

hospitals. Moving forward, Pakistan

should use CPEC as an opportunity

to: i) undertake ‘targeted’ poverty

alleviation using China’s experience

and expertise; ii) make the CPEC’s

Rashakai and Allama Iqbal SEZs in

Khyber Pakhtunkhwa and Faisalabad,

respectively, a resounding success by

courting top Chinese manufacturers

looking to relocate their industry to

consider both; and iii) negotiate and

prepare for better market access to

China whose economy is now 18.34

percent of Global Gross Domestic

Product.

Pakistan’s youth bulge is ballooning,

with 65 percent of our approximately

220 million population under the age

of 35. As per some estimates, the

Covid-19 pandemic has brought 87

million into poverty. ‘Targeted’

Poverty Alleviation, popularly

known in China as Jin Zhun Fu

Pin, identifies poverty-stricken

villages, conceives appropriate

projects mostly related to housing

and infrastructure, and proceeds with

efficient implementation of the same.

The strategy also involves identifying,

more specifically, what are called

“poverty households”, which are

essentially poor households without

any special policies or subsidies being

catered to them. Pakistan’s Ehsaas

Programme should engage and work

with China’s State Council Leading

Group Office of Poverty Alleviation

and Development to create a five-year

plan for Pakistan’s ‘Targeted’ Poverty

Alleviation Strategy.

The Rashakai SEZ has received 1,998

applications for industrial plots, while

companies such as Century Steel of

China are in the process of relocating to

Rashakai; the company had requested

the State Bank of Pakistan to provide

approval for import of machinery from

its parent company in China, which was

later given. The issue of exemption of

custom duty for import machinery has

still not been finalized, which would

be a crucial incentive for investors. As

of now, this policy will be applied on a

case-to-case basis, not as a uniform

policy for all investors wishing to invest

in these SEZs.

When China created SEZs, some

of them took off, and some of them

did not. For example, in 1979-80, the

SEZ established in Xiamen’s Fujian

province was more successful than

that established in 1985 in Hainan. It

is important for Pakistan to understand

that the governance of SEZs is a

nuanced exercise, and cannot be done

by a government official or a locally

recruited management professional;

the entity or individual that governs the

SEZ must have prior experience in SEZ

governance.

While the Board of Investment and

its affiliated agencies have given

incentives for foreign investors, we

still do not have an actual one-window

where investors can receive a one-stop

shop solution. We also must understand

that Pakistan is one of many countries

competing for investment from top

Chinese companies that are looking

to relocate manufacturing bases to

countries with lower costs of production.

Apart from being an ‘all weather friend’

of China, what commercial competitive

advantages do we offer that, for

example, Bangladesh or Cambodia

cannot match? We must make sure

that these SEZs, like any lucrative land,

do not become trading/speculative

grounds of prime real estate, which

may make money for local companies,

but would make the concept of an SEZ

futile.

After the signing of the China-Pakistan

Free Trade Agreement II, Pakistani

exporters have more access to the

$2 trillion Chinese market. Nearly 40

percent of the CPFA II products that

China imports have seen lowering of

tariff barriers, 401 Pakistani products

for which there is a market in China

can now be exported to China.

In total, 724 Pakistani products

have zero import duties in China.

However, Pakistan’s export volume

to China in 2020’s fiscal year was all

of $1.87 billion. China has lowered its

tariff barriers for 603 out of the 1,436

products listed in Priority Products II of

the CPFTA II, which are lower than that

extended to the likes of Japan, South

Korea, US, Australia and Germany for

the same products.

The government’s pivot to ‘economic

diplomacy’ should begin with China,

which is the world’s biggest market and

,fortunately for Pakistan, a neighbor

and close partner. The opportunity

that China presents to Pakistan has

to be addressed through a collective

and coordinated effort and action of

business groups like the Pakistan

Business Council, relevant government

agencies such as the Ministry of

Commerce and CPEC Authority, and

think-tanks. This is a good opportunity

to prove wrong the idea that: ‘Pakistan

never misses an opportunity to miss an

opportunity’.

The writer is the executive director of

the Pakistan-China Institute.

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Federal Budget 2021-22 has mixed

incentives for industries

A Chronicle Report

The Finance Minister, Mr. Shaukat

Tarin, presented the Federal Budget

FY 2021-22 in the Parliament on

June 11. According to his speech,

the government proposed a Rs 8.495

trillion spending-led outlay for the fiscal

year 2021-22 designed to achieve six

to seven percent GDP growth in the

next two to three years and 4.8 percent

for FY2021-22 by facilitating auto,

telecom, agriculture as well small and

medium enterprises for job creation.

The Finance Minister, in his budget

speech, came down hard on the

economic policies of the previous

governments and stated that Prime

Minister Imran Khan helped the country

avert a default and put it back on the

economic growth of 3.4 percent in the

outgoing (current) fiscal year.

The number of reaseach

houses expressed

their initial impression

on the budget with

healthy remarks. They

unanimously termed

the projected growthoriented

as significantly

increasing subsidies and

incentives for big business,

manufacturing, corporate

market and agriculture

sectors and proposing

about 24 per cent hike in

revenues, including Rs506bn worth of

additional measures.

Some salient features of the budget

are as follows:

▪ National PSDP outlay set at PKR

2,102Bn (Federal; PKR 900Bn,

Provincial; 1,202Bn), up by 36% YoY.

▪ The government expects large scale

manufacturing to grow by 6.0% in FY

2021-22.

▪ The government has set a debt

repayment target of PKR 3,060Bn for

FY 2021-22.

▪ The government has set NFC

distribution target of PKR 3,411Bn for

FY 2021-22, up PKR

707Bn / 25% YoY.

at PKR 5.8Trn for FY 2021-

22 compared to

PKR 4.7Trn in FY21.

▪ Subsidies target of PKR 530Bn for FY

2021-22.

▪ The government is eyeing total

revenue collection of PKR 7,909Bn for

FY 2021-22 of

which PKR 5,829Bn pertains to tax

revenue while the remainder (PKR

2,080Bn) relates to non-tax revenue.

▪ The government has allocated PKR

260Bn for Ehsaas programme.

▪ No change in tax rates for salaried

class individuals.

▪ Government to provide interest-free

loans of up to PKR 500,000 to the less

privileged.

▪ Turnover tax ceiling for small business

raised from PKR 3Mn to PKR 10Mn.

▪ Capital Gain Tax on disposal of

securities is reduced to 12.5%.

▪ 10% increase in pension for retired

employees.

▪ The minimum wage increased to PKR

20k per month.

▪ USD 1.1Bn allocated for vaccination

drive, 100Mn vaccination target by Jun-

22.

▪ 12 types of WHT’s abolished including

PSX, Margin financing, banking

transactions, air travel.

Sector-wise Proposals

Capital Markets (Positive):

12.5%

▪ 12 types of WHT’s abolished including

PSX, Margin financing, banking

transactions, air travel.

Cement (Positive)

▪ PKR 2Mn loans allocated for low cost

housing schemes applicable to people

below age 30.

▪ New Pakistan Housing Authority has

been made. Low income people will get

PKR 300,000

subsidy with a low mark-up on loan.

Until now applications of PKR 100Bn

worth has been

received by the banks.

▪ PSDP has been increased from PKR

630Bn to PKR 900Bn.

▪ Relating to the constructions of dams

and water preservation,

PKR 91Bn have been

allocated out of which PKR

57Bn, PKR 23Bn, PKR

6Bn and PKR 5Bn are

assigned for Dasu hydro

power project, Daimer

Bhasha dam, Mohmand

dam and Neelum Jhelum,

respectively.

Steel (Positive):

▪ Steel and alloy custom duty removed.

I.T Telecommunication sector (Neutral

to Positive):

▪ Telecom sector to be given the status

of an industry.

▪ FED on telecommunication to be

reduced from 17% to 16%.

▪ Special Technology zones will

be introduced and import of plant,

machinery and raw material in those

zones are proposed to be exempted by

sales tax.

▪ WHT of mobile phones decreased

from 12.5% to 10%.

▪ Turnover tax abolished for SEZ’s and

10-year tax holiday for STEZ’s (special

technology economic zone)

▪ FBR tax collection target has been set

▪ CGT on PSX reduced from 15% to

▪ To promote IT sector, it is proposed

TRADE CHRONICLE - May - Jun - 2021 - Page # 11


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that the export of services may be zerorated.

Pharmaceuticals (Positive):

▪ Custom duty on 350 APIs abolished.

Chemical (Positive):

▪ The rate of sales tax on potassium

chlorate is proposed to be increased

from Rs. 80 per kg

to Rs. 90 per kg in addition to 17%

standard sales tax rate.

▪ Reduction if CD/ACD on raw materials

for paint industry.

Banks (Positive)

▪ Govt has proposed removal of WHT

on Banking Transactions.

Real Estate (Positive):

▪ Reduction of block taxation on

capital gains on disposal of immovable

properties if gain

exceeds Rs. 20Mn.

Automobile (Neutral):

▪ Small cars up to engine capacity of

850cc to be exempt from value added

tax besides reduction in sales tax rate

from 17% to 12.5%.

▪ Exemption from VAT on import of

electric vehicles, CKD kits for small car,

2-3 wheelers,

HCVs and all these vehicles in CBU

conditions.

▪ PKR 0.2Mn subsidy announced for

tractors.

▪ Income from ‘On’ money on vehicles

will be taxed.

Power (Neutral to Positive):

▪ Power sector subsidy allocated at

PKR 118Bn.

▪ Measures to control Circular Debt

to be implemented in the next two

years, which include controlling line

losses, increasing renewable energy

and restructuring of private power debt

among others.

Agriculture and Fertilizer (Positive):

▪ The government has set aside PKR

12Bn for food security.

▪ The government will provide up to PKR

200,000 interest-free loan to farmers to

purchase tractor and machinery.

▪ Exemption from tax on import of

agricultural equipment.

Refinery (Positive):

▪ Zero-rating is proposed to be

withdrawn from Petroleum Crude Oil,

parts/components of

zero-rated plant and machinery, import

of plant and machinery by petroleum

and gas sector and supply, repair and

maintenance of ships.

▪ Exemption from tax on income of

deep conversion new refineries and

BMR projects of existing refineries for

10 years.

Consumer/Food (Neutral to Positive)

▪ Reduction of duties on raw material/

inputs of the footwear industry.

▪ Reduction/exemption of CD & ACD on

inputs for the poultry industry.

▪ Dairy industry tax reduced.

▪ Sales tax on sugar is proposed.

▪ Reduction/exemption of CD/ACD on

inputs for the electronic manufacturing

industry

(Courtesy- BMA Capital)

Balochistan presents

Rs584.1bn budget

The Balochistan government has

proposed an Rs584.1 billion budget for

the next fiscal year that carries a hefty

development stimulus of Rs237.2bn

and resource shortfall of Rs84.6bn amid

rare violent protest by the opposition.

Presenting the budget, Finance

Minister Zahoor Ahmed Buledi said

the government was presenting a

`balanced budget` that focused on the

development of the province in spite

of serious financial difficulties. He said

the next year`s spending plan aimed at

inclusive growth and development of

backward areas.

Balochistan is expecting federal

transfers of Rs355.9bn, provincial own

tax and nontax receipts of Rs103.2bn,

cash carryover of Rs15.5bn and foreign

project the assistance of Rs17.3bn to

finance its total current and development

expenditure of Rs584.1bn. Thus,

the province is facing a resource

shortfall of Rs84.6bn for its Annual

Development Programme, which it

will have to fill either through savings

on the current revenue expenditure

size or by slashing its development

spending like the outgoing year. The

provincial government had allocated

Rs156.5bn for development during

the ongoing financial year, which has

been revised downwards to Rs104.6bn

due to resource shortfall of Rs87.6bn

indicated in the budget.

The budget boosts health expenditure

at Rs38.5bn against current year`s

estimates of Rs31.4bn. The education

expenditure has been increased

marginally to Rs71.9bn from Rs70.3bn

while the allocation for social protection

has been doubled to Rs10.7bn. A

sum of Rs3.6bn has been set aside

for combating the Covid-19 pandemic

in the province. The finance minister

announced that 5,854 government jobs

would be created, health insurance

cards scheme would be launched

to provide free healthcare of up to

Rs1 million a year to 1.9m families,

100 middle schools would be built,

a food security revolving fund would

be launched and emergency centres

would be established on highways.

He also announced several initiatives

for the fishermen, youth, minorities,

women, destitute people and students.

The minister also announced a 10pc

increase in pay and pension of the

provincial government employees in

line with the federal government`s

decision.

TRADE CHRONICLE - May - Jun - 2021 - Page # 12


TRADE CHRONICLE

Punjab government presents Rs2.65

trillion budget for 2021-22

Punjab Finance Minister Hashim Jawan

Bakht presented the budget for the

fiscal year 2021-22 with an estimated

outlay of Rs 2,653 billion which is 18

percent more than the current fiscal

year’s budget and

The government expected to get Rs

5,829 billion from the federal Divisible

Pool and is expected to get Rs 1,684

billion from the National Finance

Commission Award, which is 18

percent more than the current fiscal

year’s allocation.

In his speech, Hashim said a target

of Rs 405 billion had been set for

provincial tax collection, which is 28

percent more than the current fiscal

year. The current expenditure estimates

in the budget is around Rs 1,428 billion.

The government has increased the

development budget by 66 percent,

which shows that it is committed to

bringing economic prosperity to the

province. He said the government

allocated Rs 189 billion for the South

Punjab, which is 34 percent of the total

The Sindh government presents

Rs1.48trn budget for the province

The Sindh government on June 15

presented Rs1.477 trillion budget for

the financial year 2021-22 with an

estimated deficit of Rs25.738 billion.

However, the Sindh government didn’t

introduce any new tax in the budget,

whereas it proposed 20 percent

increase in the salaries of government

employees and 10 percent rise in

pensions. The provincial government

also proposed the minimum wage

at Rs.25,000 against the existing

Rs17,500, in the new fiscal year.

annual development

budget of Punjab.

The government has

allocated Rs 12 billion

for the development of the industrial

sector and more than Rs 28 billion for

Lahore, considering its importance as a

business hub, he added.

He also said that the health and

education sector is the priority of the

government as it has allocated Rs

370 billion for the health sector. The

government has allocated Rs 96 billion

for development budget of the health

sector, which is 182 % more than the

current fiscal year, and it is initiating

universal health insurance program

with the allocation of Rs 82 billion.

Under this program, 100% population

of Punjab will get free and quality

health services. It is expected that

government will issue health cards to

110 million people of the province.

Moreover, the minister said, the

government has allocated Rs 442

billion for the education sector, which

is Rs 51 billion more than the current

year, and more than Rs 54 billion has

been earmarked for the development

budget while Rs 388 billion has been

allocated for

the current

expenditure.

More than

Rs 6 for the

up-gradation

of schools

and Rs 23

billion for the

schools run

by Punjab

Education

Foundation

and Punjab

Terming it a ‘citizens

budget,’ Sindh Chief

Minister Syed Murad Ali

Shah announced that the

total budget outlay for Financial Year

2021-22 is estimated at Rs1.477 trillion

against a budget estimate Rs1.241

trillion for the current FY, showing an

overall increase of 19 percent.

The current expenditure of the province

has been projected at Rs.1.14 trillion,

which includes a current revenue

expenditure of Rs.1.089 trillion and

current capital expenditure of Rs.59.49

billion in the budget. “This is 78% of

the total expenditure of the province

Education Initiative Management

Authority billion has been reserved.

The government has allocated Rs 15

billion for higher education which is

285% more than the current fiscal year.

In order to ensure food security and

increase agricultural productivity, the

minister added, the government has

made a whopping increase of over

300% in the agriculture development

projects. It allocated more than Rs31

billion for the agriculture transformation

and Rs 100 billion for Agriculture

Transmission Plan. Moreover, Rs

55 billion has been set aside for the

irrigation sector.

For livestock and dairy development

projects, Rs5 billion have been

allocated, and for the improvement

of watercourses, Rs5 billion have

been earmarked. For environmental

protection, an allocation of Rs4 billion

has been made, out of which Rs2.5

billion will go to the Prime Minister’s

flagship 10 billion tree tsunami project.

The government has earmarked Rs 380

billion for the construction, repair and

expansion of roads in the province. In

order to provide relief to the taxpayers

and revival of business, the government

has proposed tax concessions of Rs

50 billion. There will be no change

in the rate of stamp duty, and it will

remain 1% only. The ratio of sales

tax on services will remain 5%. The

government has proposed a reduction

of the tax ratio on call centres from 19

% to 16 %. The government has also

proposed a 10% increase in salaries

and pension of provincial employees

besides increasing the minimum wage

of workers from Rs17,500 to Rs20,000.

(Courtesy – Business recorder)

and shows an increase of 14%

overestimates of Rs.1 trillion for last

year,” Shah said.

The development expenditure of

the province in the budget has been

proposed at Rs.329.032 billion, which

include Rs.222.5 billion for Provincial

ADP and Rs.30.0 billion for Districts

ADP, foreign project the assistance of

Rs.71.16 billion and Rs.5.4 billion from

Federal PSDP Grant for schemes being

executed by the Government of Sindh.,

The Chief Minister said that a 20%

increase had been proposed for the

government employees and a 10% rise

TRADE CHRONICLE - May - Jun - 2021 - Page # 13


TRADE CHRONICLE

in pensions of the retired government

workers had been proposed. He said

the minimum salary of the laborers

would be increased from Rs17,500 to

Rs25,000.

Chief Minister said that health

remains a priority sector, and for the

next financial year, an allocation of

Rs.172 billion is proposed as against

a budget of Rs.132.88 billion in 2020-

21.

The budget for education in the next

budget has been proposed Rs.277.5

billion against Rs.244.5 billion in the

current fiscal.

Murad Shah announced that

budget estimates for the current

revenue expenditure of the Energy

Department are estimated at 23.26

billion, which includes Rs.21 billion for

clearance of outstanding liabilities of

electricity dues of various government

departments pertaining to DISCOs

KPK unveiled a Rs1.118 trillion budget

for the fiscal year 2021-22

The Khyber Pakhtunkhwa

Government’s Minister for Finance

Taimur Saleem Jhagra presented a

Rs1.118 trillion budget for the fiscal

year 2021-22 (21 per cent higher than

current year`s Rs923bn) with a record

development outlay of Rs371 billion to

mitigate the impact of Covid-19 and

boost economic development.

Revenue estimates showed that the

province would receive Rs559bn from

the federal divisible pool, Rs74.5bn

net hydel profit on hydroelectricity

produced in the province and Rs75bn

own revenue. The Centre would

provide Rs187.7bn in lieu of federal

grants for merged districts with a

transfer of Rs34.6bn from the divisible

such as KE, Hesco and Sepco.

He said that to exploit Thar coal

potential, Sindh had requested the

Federal Government to consider

progressing on Kati Bandar Project and

laying a railway line from Islamkot to

Mirpurkhas for coal logistics. The two

approaches are essential as industrial

expansion in Thar is challenged by

extreme weather conditions and water

Rs89.2bn.

pool at Rs34.6bn.

Foreign assistance for

development projects

has been pitched at

Expenditure estimates showed that

salaries of government employees and

pensions would cost the province a

whopping Rs466bn.

The development outlay of Rs371bn

has proposed a provincial component

of Rs150bn and Rs24bn for merged

districts. District ADP for settled parts

of the province has been pitched at

Rs15bn and that for merged districts at

Rs2.4bn.

The donor-funded projects have been

pitched at Rs89bn.

He said the government had set the

minimum

wage at

Rs21,000

a month for

labourers,

w h i l e

Rs10bn each

has been

allocated

for wheat

subsidy and

provision of

food basket

for poor.

availability.

The Chief Minister said that Rs.78

billion is earmarked for local councils in

Sindh during the current financial year.

For the next financial year allocation of

Rs.82 billion has been proposed.

He stated that the Government

of Sindh provided Rs.4.02 billion

as a relief grant and distributed

compensation to the victims of

monsoon during CFY. For 2021-22,

an allocation of Rs.500 million has

been kept for various relief measures.

Shah stated and desired to work in

close coordination with the Federal

Government in the immense interest

of the people of Pakistan to overcome

these issues. “We expect that the

Federal Government would also

support us in all our endeavours and

help to come up with viable solutions

to the issues being faced by Sindh,” he

stated. (Courtesy – BR)

For economic recovery, Rs10bn will

be provided to small and medium

enterprises, women, minorities, youth

and businesses hit by the pandemic.

The finance minister also announced

a 10pc pay raise in salary of all

government employees and said those

employees who did not draw special

allowances would get a pay raise of

37pc.

He said the province would also

spend Rs10.4bn on reducing regional

disparities and Rs2.6bn on providing

stipends to 20,000 prayer leaders in

the province.

Mr Jhagra said that in order to boost

economic activities in the province, the

government had reduced taxes. He

said f armers had been given exemption

from landholding tax during the next

year, while registration fee for vehicles

has been reduced to a nominal rate of

Re1. He also announced tax exemption

for all professionals.

The finance minister said the

government would spend Rs2.8bn on

extension of Rescue 1122 services to

other parts of the province.

He said the tourism department

development budget had been

increased to Rs12bn from Rs2bn

and that of science and technology to

Rs2bn from Rs1.1bn. (Excerpt – Dawn)

TRADE CHRONICLE - May - Jun - 2021 - Page # 14


TRADE CHRONICLE

A Pragmatic view of Pakistan’s

budget 2021-22

By Dr. Muhammad Nawaz Iqbal

Pakistan’s Budget 2021-22 is

quite different from the past one of

incumbent government. This difference

is in a positive outlook. The current

government of Pakistan under Prime

Minister Imran Khan has introduced

its third financial plan for the Fiscal

Year 2021-22. This financial plan has

a worth of Rs8.49 trillion, an expansion

of Rs700 billion in the course of the last

financial plan, and a GDP development

rate focus of 4.8 percent. The 2021-

22 spending plan is significant as the

nation has introduced positive financial

markers throughout the most recent a

half year of the FY21.

The Regulatory obligation on the import

of cocoa glue, margarine, and powder

will be decreased. The government

has brought up in the Economic

Survey that unfamiliar interest in

Pakistan has declined because of

worldwide conditions brought about

by the Covid-19. The Economic

Survey shows unfamiliar speculation

figures for the initial nine months of

the current financial year, esteemed

at about ً 1.4 billion in the July-March

period, up from the past monetary year.

The nation’s overall imports in these

months remained at 42.3 billion, up

13.5 percent from $37.3 billion dollars

in a similar period last monetary year.

During the period under review, the

nation’s fares expanded by 6.5 percent,

yet the sharp ascent in imports cleared

out the advantages of the increment in

sends out. It very well might be reviewed

that Pakistan had set an absolute

import focus of 42 billion this year,

yet in ten months, the nation’s

imports surpassed this objective,

prompting a broadening

import/export imbalance. The

development force got noticeable

by the center of the current monetary

year. Huge scope producing, income

assortment, trades, mechanical power

utilization and private area credit off

take began to show solid development.

Horticulture, the biggest work area in

Pakistan, and development, the biggest

business metropolitan area, are both

seeing solid development. The budget

2021-22 hopes to gather PKR 5.83

trillion in charges. This is 24% more

than the assessed PKR 4.69 trillion that

Pakistan desires to gather in the active

financial. As indicated by the Finance

Minister, with the economy developing

by 4.8 percent and with expansion being

around 8%, then, at that point there

will be a characteristic development

of around 13% or PKR 550 billion in

charge incomes. The monetary review

for the current monetary year likewise

specifies Pakistan’s developing import/

export imbalance.

The overview gives unfamiliar

exchange information to the initial ten

months of this monetary year, July-

April, which shows that the nation’s

import/export imbalance has expanded

by over 21% in those ten months. The

government has provisioned for a gross

outer receipt of PKR 2.75 trillion.

This incorporates credits of PKR 2.7

trillion and awards of PKR 0.32 trillion

and undertaking advances and awards

outside PSDP of PKR 0.23 trillion. Out

of this gross sum, PKR 1.5 trillion will

go in reimbursing unfamiliar advances

and PKR 0.74 trillion in reimbursing

unfamiliar credits, leaving net unfamiliar

receipts of PKR 1.25 trillion. Out of the

complete outer advances being taken,

about PKR 800 billion (about US $5

billion) will be taken from business

banks.

Cotton is the country’s fundamental

material fare significant crude material.

As per the Economic Survey, the region

under cotton development has likewise

declined in the monetary year under

audit.

In the last monetary year, cotton was

developed in a space of 2517 thousand

hectares. Nonetheless, in the current

monetary year, the region under cotton

has diminished by about 17.5 percent

and the region under development

stayed at 2079 thousand hectares. The

rationale of expenses and the choice

not to expand power rates could help

keep away from burglary from electrical

cables and the non-installment of

assessments – however it is very

hard to perceive how merchants, who

structure a monstrously incredible hall,

will be burdened effectively.

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TRADE CHRONICLE - May - Jun - 2021 - Page # 15


TRADE CHRONICLE

Salient feature of Pakistan

Economic Survey FY21

Key Highlights

Provisional GDP growth rate clocks

in at 3.94% for FY21. GDP growth for

FY20 was revised down to -0.47% from

-0.38% earlier.

GDP at current market prices stood at

PKR 47.7trn for FY21 (14.8% YoY).

Key growth sectors: Services 4.43%,

Industrial 3.57% and Agriculture 2.77%.

Growth of important crops: wheat

(8.1%), rice (13.6%), and maize

(7.38%).

Sugarcane recorded the secondhighest

ever production at 22%.

Other crops such as livestock and

forestry grew 1.41%, 3.1% and 1.4%,

respectively.

Cotton witnessed negative growth of

22.8% resulting in 15.6% decline in

cotton ginning.

Industrial sector’s growth was primarily

driven by unprecedented growth of

9.29% in LSM.

Service’s sector growth was mainly on

the back of wholesale and retail trade

Contuined from page # 9

unity and sovereignty of states, noninterference

in their internal affairs, and

the endeavour to resolve disputes by

peaceful means.

His Royal Highness, the Crown Prince,

welcomed the recent understanding

reached between the military authorities

of Pakistan and India regarding

ceasefire at the Line of Control (LoC),

which is based on a 2003 understanding

between Pakistan and India. The two

sides emphasized the importance of

dialogue between Pakistan and India to

resolve the outstanding issues between

the two countries, especially Jammu

and Kashmir dispute, to ensure peace

and stability in the region.

The Prime Minister congratulated the

government of the Kingdom of Saudi

Arabia for successfully organizing and

holding the G20 summit meetings and

the positive decisions that resulted

from it in economic, developmental,

environmental, health, energy and

segment

(8.37%) and

finance and

insurance

s e c t o r

(7.84%).

Pakistan’s

total public

debt stood

at PKR 38trn

as at end of

Mar’21. The

domestic debt

amounted to

PKR 25.6trn

(up 13.8%

YoY) while the

foreign public debt was PKR 12.5trn.

Average National Consumer Price

Index (CPI) clocked in at 8.83% (as per

11MFY21 PBS data).

Pakistan’s fiscal deficit arrived at PKR

1.65trn in 9MFY21 (3.6% of GDP)

compared to PKR 1.69trn in 9MFY20

(3.8% of GDP).

Remittances have clocked in at USD

26.7bn as per 11MFY21 SBP data, up

29% YoY.

Foreign Direct Investment (FDI) clocked

in at USD 1,553mn during 10MFY21,

down 32% YoY.

other fields.

The Prime Minister appreciated the

efforts of the Kingdom and its leadership

in serving the Two Holy Mosques,

their pilgrims, Umrah performers and

visitors, especially in organizing the

Hajj season for the past year 1441 AH,

despite the challenges posed by the

Corona pandemic.

In order to further strengthen and

diversify bilateral relations, the

following agreements and Memoranda

of Understanding were signed;

Agreement on Establishment of Saudi-

Pakistan Supreme Coordination

Council (SPSCC);

MoU in Combating Illicit Traffic in

Narcotics, Drugs, Psychotropic

Substances and Presursor Chemicals;

Framework MoU between SFD

and Islamic Republic of Pakistan

Pakistan recorded a Current Account

surplus of USD 773mn in 10MFY21

against a deficit of USD 4,657mn

recorded in the SPLY. During 10MFY21

total imports recorded an increase

of 8% YoY to USD 48,625mn while

exports have clocked in at USD 25,889

mn posting a jump of 6% YoY.

Trade deficit recorded a deficit of USD

22,736mn compared with a deficit of

USD 20,599mn in 10MFY21, marking a

jump of 11%.

The per capita income for FY21 in PKR

terms stood at PKR 246,414 (+14.6%

YoY) while in USD terms it was USD

1,543 (+13.4% YoY).

for financing projects in Energy,

Hydropower Generation, Infrastructure,

Transport & Communication and Water

Resource Development;

Cooperation Agreement in the Field of

Combating Crimes; and Agreement on

Transfer of Convicted Prisoners.

The Prime Minister expressed gratitude

and offered his best wishes to His

Majesty King Salman bin Abdulaziz

Al Saud, Custodian of the Two Holy

Mosques, His Royal Highness Crown

Prince Muhammad bin Salman bin

Abdulaziz Al Saud, Deputy Prime

Minister and Minister of Defence, and

the brotherly people of the Kingdom of

Saudi Arabia. His Royal Highness the

Crown Prince warmly reciprocated with

best wishes for health and wellbeing

of the Prime Minister, and prayers

for the progress and prosperity of the

brotherly people of the Islamic Republic

of Pakistan.

TRADE CHRONICLE - May - Jun - 2021 - Page # 16


TRADE CHRONICLE

Tariq Glass Industries continues to expand

its production capacity in Pakistan

A Chronicle Report

Tariq Glass Industries Limited is

a premier glass manufacturing

organisation of international standards

and repute. It produces tableware, float

glass and container-ware products

under brand names Toyo Nasic,

Omroc, Nova and Tariq Float Glass.

In container-ware, we supply mostly to

the beverage industry such as Coca

Cola, Pepsi along with other domestic

manufacturers.

With the largest state of the art

production facility, Tariq Glass

Industries Ltd. produces its tableware

products on single and double gob

press machines as well as H-28 (press

& blow) and stretch machines.

Onsite mould workshop, all weather

warehousing, international standard

packaging, advanced laboratory and

Tecno 5 decorating machines are just a

few examples of the facilities that Tariq

Glass Industries offers to its valued

customers.

Quality and reliability are the

cornerstones of Tariq Glass Industries

Ltd. The company offers innovative,

value-added products, tailored to

the customer’s needs and

satisfaction for household

as well as industrial

requirements.

Expansion program:-

The Company’s has

expanded its float glass

production capacity by adding

an additional 500 tons per day

furnace in 2021. This increase

in production

will bring Tariq

Glass Industries

Limited’s total

float glass

capacity to 1,050 tons per day.

Further Expanion plans in 2021 /

2022 will see the company increase

its production of tableware as well,

thereby, enabling the company to

better cater to the growing demand

for glass both domestically as well as

internationally.

Financial Performance for 9MFY21

The Company has performed beyond

expectations in the second and third

quarters of the financial year by

delivering revenue growth, despite the

challenging environment, maintaining

profitability and ensuring business

continuity.

The top-line revenues of the Company

registered a robust growth of 23.61%,

which is recorded as Rs. 14,059 million

for a cumulative period of nine months

as compared to Rs. 11,374 million of

the corresponding period of the last

year.

The EPS for the period under report

also reflected a sturdy improvement

and stood at Rs. 14.82 as compared to

EPS of Rs. 6.28 of the same period of

the last year.

The Company’s production facilities of

Tableware and Float Glass, were fully

operational during the nine months

ended on March 31, 2021.

Future Outlook

The Company acknowledges the boom

in the construction industry, which has

created demands in the concerned

sectors. This was possible due to

conducive policies of the government.

In support of the construction sector

and to boost employment and economic

output, the Government has announced

a construction stimulus package by

fixing the tax rate for the construction

industry, a subsidy worth PKR30 billion

(US$191.5 million). The predicted

growth in this sector is expected to

increase by 3% in real terms in 2021,

recovering from a decline of 6.2% in

2019.

The Company has expressed hope

that with the induction of the added

production from the Float Glass Plant

Unit II, a wide variety of float glass

products will be available not only in

the shape of the clear and coloured

float glass (i.e., green, blue, bronze),

mirror and reflective coated float glass

but also, the float glass of varied

thicknesses in the range

of 2 mm to 12 mm will be

maintained in stocks for sales.

Tariq Glass is poised to

not only meet the growing

domestic demand but also

the international requirements

for glass, which would earn

valued foreign exchange by

exporting tableware and float

glass products.

TRADE CHRONICLE - May - Jun - 2021 - Page # 17


TRADE CHRONICLE

RCET policy helps in boosting

textile export in Pakistan

By Saddam Hussein

Pakistan has untapped export potential

in the textile sector. The role and

impact of the textile sector can very

well be gauged from its contribution to

the national economy. It comprises 8.5

percent of the country’s GDP, employs

40 percent of the labour force and

contributes 60 percent to the export

sector. Directly and indirectly, the textile

sector impacts the lives of 25 million

people out of a 220 million population.

To actualize this great inherent potential,

considerable investment in machinery,

enhanced skill set and product

development are critical. Success in

these avenues is not possible in the

absence of supporting policies from

the government, particularly in the

backdrop of tough competition in the

sector in the region.

The Pakistan Institute of Development

Economics (PIDE), in its latest study,

has highlighted the policy consistency

and other critical issues concerning the

textile sector of the country. The report

argues that the PTI government’s policy

of regionally competitive energy tariff

(RCET) has boosted textile exports

and brought economic stability. It says

abandoning the policy in favour of a

new support regime will have serious

repercussions for the industry. The

government of Pakistan introduced the

RCET policy in 2018. From October

2018 onwards, under this policy, the

government provided re-gassified

liquieied natural gas (RLNG) at $6.5/

mmbtu, and since January 2019,

electricity tariffs were 7.5 cents/kWh.

However, the electricity tariffs were

raised to 9 cents/kWh in September

2020.

A policy is a tool to achieve a certain

objective and an effective way to

eliminate uncertainty by upholding a

clear pathway. A predictable and stable

policy enables all agents to have a

level playing field and act accordingly.

Unfortunately, there is a lack of policy

predictability and consistency in

Pakistan. This is a significant growth

constraint. For instance, a few large

textile mills are taking the risk of

expansion and installing additional

units in the backdrop of favourable

policy for textiles. Yet, most of the textile

industry is reluctant to decide what kind

of machinery to import and how much

expansion to plan. All of them are

unsure about the time frame of

the current policy, which could

change anytime. A miscalculation

could inflict considerable losses on

the mills.

The textile sector is in dire need of a

long-run comprehensive investment

plan to emerge as a key driver of

economic growth. Investment on such a

scale can have positive spillover effects

in the sector and in allied industries.

As of now, the industry’s productivity

has increased a bit, and investment

is happening. Now, to avail the full

potential of the textile sector and retain

and enhance the existing customer

base, consistent implementation of the

RCET policy is needed.

Instead, some quarters are arguing

that the RCET will make the sector

regionally uncompetitive. Others are

suggesting a moratorium on gas

supplies. With these whimsical policy

signals, we would not be able to

develop investors’ confidence to reap

the full potential benefits of the sector

will remain a distant dream.

Assuming that competitive energy

prices alone would solve all the

problems is naive. Take the example

of electricity. Power supply from the

grid follows a lot of fluctuations and

breakdowns. These fluctuations in

the supply have heavy costs for a unit

depending upon which sub-sector it

is operating in. For instance, a oneminute

breakdown in spinning stops

work for 20 to 25 minutes and causes a

10 to 15 percent production loss in the

case of weaving.

Likewise, ensuring the desired pressure

of the gas at the unit’s inlet cannot

be guaranteed by just competitive

energy tariffs. Additionally, the latest

machinery is computerised and comes

with sensitive electronic gadgets.

Power shutdowns and fluctuations can

sometimes cause damage to these

gadgets and stop working. These

gadgets are not locally made, so these

must be imported. This takes at least a

few days, if not more, further adding to

the costs.

Furthermore, availability of the raw

material, i.e., cotton, is increasingly

becoming a significant challenge.

Its production is on the low side and

its quality is poor. Cotton is a Kharif

crop (monsoon crop/ autumn crop). In

Pakistan, there are three other major

Kharif crops besides cotton. These

include maize, rice, and sugarcane.

Over the last two decades, the area

under sugar cane and rice cultivation

has increased by almost 19 percent.

Whereas the cultivation area of

maize has increased by 40 percent.

The cultivation area of cotton has

decreased by 18 percent. Besides,

the cotton crop is more prone to pest

attacks and plant diseases. If farmers

use pesticides, it adds to the cost,

and for the small farmer, integrated

pesticide management is expensive.

Thus, farmers are shifting from cotton

to crops which are more profitable for

them.

Additionally, contamination in handpicked

cotton in Pakistan is a persistent

issue concerning the quality and value

of cotton. Pakistani cotton is one of

the most contaminated in the region.

Untrained cotton pickers from field

and low-ginned quality standards add

to cotton fetching lower value in the

market. Pakistani ginned bales contain

8-10 percent trash, while in the world,

it averages around 2-3 percent. Poor

quality cotton in terms of its physical

properties raises the processing costs

and reduces the output and quality of

the final products. To increase cotton

production, we need to supply farmers

high-yield seeds that raise profitability.

The provision of such high-yield

seeds is only possible after necessary

research and innovation regarding the

seed quality. Research should also be

done on the type of seeds resistant to

pests/insects and plant diseases. All

these concerns put a question mark

on the performance of government

agriculture research bodies.

The state machinery has apparently

misunderstood policy-related

dynamics. Most of the policies can

rightly be described as arbitrary,

unpredictable, non-consistent and

non-conclusive. There is a sheer lack

of long-term comprehensive planning.

Consistency and long-term planning is

the way forward.

TRADE CHRONICLE - May - Jun - 2021 - Page # 18


TRADE CHRONICLE

Leather Industry

leather exports from Pakistan

continue to decline in 9MFY21

Pakistan leather industry export

proceeds during the first nine months

of July – March 2021 reduced by 2.54

per cent to US$ 640.02 million against

US$ 656.71 million, earned in the nine

months of last fiscal year July –March

20, says data released by the Federal

Bureau of Statistics (FBS).

The breakdown of export shows that

tanners have earned US$113.32 million

on the export of 8.125 million sqm of

finished leather between the periods of

July – March 2021 as compared to US$

151.33 million on the export of 13.895

million sqm in similar nine months

in a year-ago period. The export

figure translates that tanned

leather exports fell by 41.53 per

cent in terms of quantity and 25.12 per

cent in terms of dollars respectively

during this export period.

Similarly, the footwear exports recorded

a fall of 5.15 per cent in terms of value

between July and March 2020-21.

During this period, footwear export

reached US$98.98 million by exporting

13.290 million pairs as against US$

104.35 million for 11.560 million pairs

shipped in the same nine months of

the previous fiscal year. However, the

quantity rose by 14.97 per cent during

this exporting period.

On positive development,

the export of leather

manufacturing, including

the export of garments and

leather gloves, increased

to US$ 427.72 million from

US$ 401.02 million during

this period. This export

represents a rise of 6.66

per cent on a YoY basis.

Indian leather exports

continue to contract in

outgoing fiscal year FY21

According to the Indian’s Council for

Leather Exports (CLE), the export

revenue on account of leather and

leather products for the period April

2020 – March 2021 stood at the

US $ 3.681 billion as against the

performance of US $ 5.070 billion in

April 2019 – March 2020, recording a

significant decline of 27.39%. However,

in rupee terms, the export received

revenue of INR 272.099 billion during

this period against INR 359.503 billion

in the corresponding period last year.

Thus, registering a decline of 24.31%

only.

The finished leather exports fell in value

by 27.84% to $378.23 million from US$

524.15 million, leather footwear by

28.64 % to the US $1485.55 million

Bangladesh leather industry sees significant growth

despite the negative impact of Covid 19

Bangladesh leather industry sees

significant growth despite the negative

impact of Covid 19 on the country’s

export. During the first ten months of

the financial year 2020-21 (July – April

2021), the leather sector has earned

export revenue of US $760.92 million

as compared to US$ 700.93 million

earned in the same months of the

previous year. It translates a singledigit

growth of 8.56 per cent on a YoY

basis, says the Bangladesh Export

Promotion Bureau (EPB).

The break down shows that Bangladesh

bagged US$ 96.10 million on exports

of finished leather in the first ten

months of the current financial year

compared to US$ 90.47 million in July

– April 2020. It shows a growth of 6.22

per cent.

The exports of leather products

have also expanded to US$ 203.10

million from the US $ 197.30 million

of the same ten months of last year. It

translates to an incline of 2.94 per cent

on a YoY basis.

The leather footwear exports saw

double-digit growth of 11.76 per cent

to the US $ 461.72 million from US$

413.15 million during this export period.

The Bangladesh Export Promotion

Bureau (EPB) had set the export target

for the leather industry at US $920

million for the financial the year 2020-

21 (July – June) compared to the US

$797.6 million earned in the previous

fiscal year.

from US$ 2081.64 million, and leather

garments by 31.12 % to $ 295.56

million from US$ 429.11 million during

this period.

The leather goods export also

decreased by 29.56%, US$ 944.31

from US$ 1340.56 million during this

export period. But on a positive note,

Saddlery and Harness export rose to

US$ 186.18 million from US$ 151.44

million, reflecting a growth of 22.94%.

Out of total exports, the footwear

(Leather Footwear, Footwear

Components & Non-Leather Footwear)

holds a significant share of 50.99% in

the total export of leather and leather

products with an export value of US

$ 1877.30 million. This is followed by

Leather Goods & Accessories with a

share of 25.65%, Finished Leather

10.27%, Leather Garments 8.03% and

Saddlery & Harness 5.06%.

TRADE CHRONICLE - May - Jun - 2021 - Page # 19


TRADE CHRONICLE

Federal Budget FY22 offers cheap raw materials for the

footwear industry in Pakistan

Finance Minister Shaukat Tarin,

presented Federal budget in Parliament

on June 11. A Rs 8.495 trillion spendingled

outlay for the fiscal year 2021-

22 designed to achieve six to seven

percent GDP growth in the next two to

three years 4.8 percent for FY2021-22

by facilitating auto, telecom, agriculture

as well small and medium enterprises

for job creation amid roaring protest

from the opposition.

Last year, the minister said that this

government initiated a comprehensive

customs tariff reforms exercise, and

more than 1600 tariff lines constituting

thousands of raw materials were

exempted from customs duty. In the

forthcoming budget, the same trend

jacks up to make them completely

duty-free. These items include the raw

material used in chemicals, leathers,

textile, rubble and fertilizers.

In addition, the rate of customs duty

on around 200 tariff lines consisting of

raw materials and intermediate goods

is being proposed to be reduced from

20%, 16% and 11% and 3% to 11%,

3% and 0%. These items include

Bleaching, Rubber and raw material

for particular domestic use. Hopefully,

these reductions would bring down the

manufacturing cost of footwear.

Earlier, Pakistan Footwear Association

has suggested its recommendations

regarding the Income & Sales Tax in

the forthcoming 2021-2022 Financial

Budget.

Besides Income Tax & Sales Tax, the

25-point recommendations include

suggestions to reduce various duties

& tariffs. And to implement policies

that benefit the footwear sector In the

country to promote and pursue the

“Made In Pakistan” policy aggressively.

The recommendations proposed

by Mr Muhammad Imran Malik

ChairmanPakistan Footwear

Association with regards to Income Tax

include:

• The surplus Income Tax amount paid

this year should be carried forward next

year and adjusted against the Income

Tax due next year.

• Exempt from minimum Income Tax

• The percentage of Depreciation

Allowance for the Plant, Machinery and

Equipment to be reinstated stored at

50%, and for the buildings, it should be

restored to 25%.

• And the tax credit for investment to

be restored to 10%

• Instead of the Business, the Income

should be made as to the base.

• Exemption of Income-tax on

dividends, for the companies in the

Green Field Industries & in the Special

Industrial Zones.

• Gradual adjustment of the Corporate

Income Tax from 29% to up to 25%

• Abolishment of Advance Income Tax

• Tax charged on the Shareholder’s

dividend to be reduced from 15% to

10%.

• Request to extend the term for

Business losses from 5-years to

unlimited.

Similarly, for the sales tax.

• Sales tax on Retailers

to be reduced up to 8%

• Additional tax should

be a part of the Output

Tax

• Sales tax on Small

Retailers & Wholesalers

tax should be brought

from 17% to 10%.

• Sales Tax Refund to

be adjusted against the

Mr. Muhammad Imran Malik

Sales Tax.

• Viable solutions should be

implemented at STA for the due Income

Tax.

• Permit Zero ratings on Sales Tax

against the IOU Manufacturing Bonds

utilized against the purchase of locally

manufactured material.

• Form C’s submission date to be

strictly implemented from the end-ofthe-month

to the 10th of the following

month.

• Unregistered dealers to be brought in

the tax net.

• Business with a history of full

compliance with FBR should be

exempted to pay 14% instead of 17%

on all materials.

• To evaluate prices, the ITP valuation

ruling should be made on a half-yearly

basis.

• Water Treatment & Waste Treatment

for all industries to be exempted from

tax.

• To promote Made in Pakistan

policy, duties to be waived off on all

lab equipment used for in the shoe

manufacturing industry.

• DORD to be abolished on all raw

material used for the shoe industry &

should be brought on the lowest slab of

the customs duty.

• And a humble request to the

Government of Punjab to allocate land

to establish the Pakistan Footwear

Associate Institute at the Quade-e-

Azam Business Park.

A Chronicle report

TRADE CHRONICLE - May - Jun - 2021 - Page # 20


TRADE CHRONICLE

Cement Industry

Federal budget 2021/22 positives for

cement industry in Pakistan

Pakistan Finance Minister Shaukat

Tarin presented the PKR8.48 trillion

federal budget for 2021-22 in the

National Assembly last week. The

government had set the GDP growth

target at 4.8 per cent against the

expected 3.9 per cent for the outgoing

fiscal. In addition, Islamabad allocated

a considerable fund for Public Sector

Development Programme (PSDP).

These indirect invectives are

conducive for the cement industry

in Pakistan; research

experts believe and

unanimously termed

the budget, neutral to

positive for the cement industry.

The government allocated PSDP at

PKR 2,135bn (highest ever; federal

PSDP at PKR 900bn against PKR

650bn last year with PKR 1,235bn set

aside for provinces) should encourage

development in the country and hence,

propel cement demand, analysts

remarked.

Additionally, the National Highway

Authority allocated PKR 114bn vs PKR

Budget impacts on cement

Maple Leaf awards a contract

to DESCON again

Maple Leaf Cement awarded

Construction Contract to Descon

Engineering Limited [DESCON].

DESCON has a long-standing

relationship with Maple Leaf Cement,

having successfully contributed

towards the construction of Maple

Leaf’s Line 3 in 2019. Maple Leaf

has now awarded the contract for the

construction of its upcoming Line 4

to DESCON, to be launched in 2022.

The scope of the work includes civil

works of 7,000 metric tons cement

clinker per day plant at existing Maple

Leaf Cement Factory in Iskanderabad,

District Mianwali.

Being a market leader, Descon has

executed major industrial projects

across the region and as a

leading cement contractor, it has

successfully delivered and worked

on numerous cement plants in Pakistan

with a total capacity of 80,900 TDP.

DESCON’s work and its

long service history in

Pakistan is a testament

to its belief in Partners in

Progress. It is because

of for this very reason

that Maple Leaf has

once again chosen

DESCON to develop its

new project.

Taimur Saeed, President

Sales & Marketing

welcomed the news,

“We have always upheld

our tradition of delivering

118bn in FY21 (actual expenditure

in 10MFY21 set at PKR 79bn as

per Planning Commission suggests

augmented allocation by 44 per cent

this year). Furthermore, a subsidy of

PKR 30bn has been earmarked for

the Naya Pakistan Housing Authority

alongside PKR 3bn for the Naya

Pakistan mark-up subsidy, which

should trigger construction demand.

Moreover, PKR 57bn, 23bn, 06bn and

14bn has been set aside for Dasu,

Diamir-Bhasha, Mohmand and Neelum

Jhelum dam, and work on their colonies

should materially pick up cement

demands.

The All Pakistan Cement

Manufacturers Association (APCMA)

is yet to comments on the merits of

fiscal measures. However, they had

appealed to the government to abolish

the FED and reduce other duties and

taxes to provide an opportunity for

the manufacturers to control their cost

of production and further, optimize/

expand their pant that will help generate

more employment and revenues for

the government. Similarly, the AHCML

Research raised the question that

corporate income tax, fuel, and duty

on Coal should have been slashed to

support the cement industry.

A Chronicle report

excellence on projects executed by

DESCON. Having worked on majority

of Pakistani cement plants and several

plants internationally. We are grateful

to Maple Leaf Cement for continuing to

show their faith in our capabilities.”

TRADE CHRONICLE - May - Jun - 2021 - Page # 21


TRADE CHRONICLE

The Federal Bureau of Statistics (FBS)

of Pakistan has released cement export

and production data for the July 2020-

May2021 (eleven months) and July

2020-April 2021 ( ten months) periods.

Both segments of cement post rising

trends in export and local production.

Export values and volumes increased

during this period, but an average

export price remained weaker,

reflecting a poor price market for

cement and clinker. Meanwhile, local

output increased driven by high local

demands, enabled by the central

bank continued incentive directly and

indirectly.

AHL Research reports that exports

were climbing up during this period due

to a stunning jump in North exports to

Afghanistan and visible South exports

to Bangladesh and Sri Lanka.

Export

Pakistan registers higher export and production

in eleven and ten months FY21

Pakistan’s cement industry in

11MFY20-21 earned US$253.584m of

Bestway Cement to set up Greenfield

cement plant in Punjab/Pakistan

Bestway Cement Limited has informed

Pakistan Stock Exchange (PSX) on

May 27 that because of the increasing

demand for cement in the country,

the Company has decided to set up a

Greenfield cement plant with a capacity

of 7,200tpd of clinker near Paikhel,

District Mianwali, in Punjab Province.

Company Seceerraty, Sehar Husain,

in material information to PSX added

that plant would have a 9 MW Waste

Heat Recovery Plant. To that end,

the Company has entered into an

agreement with Sinoma International

Engineering Co., Limited, PR China for

EPC.

In addition, all necessary regulatory

approvals and financial arrangements

export revenue by dispatching 7.442Mt

of cement and clinker overseas,

compared to US$242.505m from

6.570Mt of exports in the year-ago

period. The export figures represent

a noticeable growth of 4.57 per cent

in dollar terms and rising double-digit

growth of 13.27 per cent in terms of

volumes during this period on a YoY

basis, as reported by FBS.

In local currency terms, the export

value increased by seven per cent to

PKR40. 722bn (US$253.584m) from

PKR38.053.96bn during this 11MFY20-

21. Nevertheless, the cost per tonne

fell from US$36.91/t in 11MFY19-20 to

US$34.07/t during the July 2020-May

2021 period.

While, in May 2021 alone, revenues

surged to US$28.527m on the export

of 818,471t from US$15.012m on the

export of 377,016 cement and clinker

exports in April 2021, apparently due

to the vanishing of the negative impact

of COVID-19 in the world supply

chain. The export trend represents a

have been secured.

However, no time

frame of completion

was disclosed.

Bestway is the second-largest cement

producer with six state-of-the-art

production lines at four locations:

Hattar, Farooqia, Chakwal and Kallar

Kahar. Its total production capacity

of 10.7Mta. It had remained the

single largest exporter of cement to

Afghanistan and India (Presently,

export to India is suspended)

Operating Highlights

The Company recorded a gross

turnover of Rs. 63.2bn in the nine

months ended March 31 2021, 30 per

cent higher compared with Rs. 48.8

bn during the same period last year.

Net turnover for the period increased

by 46 per cent,

from Rs. 28.7

bn to Rs. 41.9

bn. This was

driven by higher

sales volume,

a decrease in

FED and better

selling prices.

substantial rise of 90.03 per cent and

117.09 per cent in terms of value and

quantity, respectively, on MoM.

Similarly, in the comparison period

of May 2020, when exports stood at

US$19.302m on the shipments of

611,284t of commodities, exports grew

by 47.79 per cent in value and 33.89

per cent in quantity, YoY.

Production in 10MFY21

The overall output of Large Scale

Manufacturing Industries Index (LSMI)

increased by 12.84 per cent for July-

April 2020-21 compared to July- April

2019-20 in Pakistan, including the local

cement production, FBS estimated.

During this cumulative ten-month period

of July 2020-April2021, Pakistan’s

cement production increased by 25.36

per cent, YoY to 41.845Mt compared

to 33.379Mt a year earlier. The upward

trend in cement production was also

observed in April 2021 alone, when

production rose by 27.44 per cent to

4.2261Mt versus 3.316Mt in the same

month last year.

New export markets for

Pakistani cement

Once its biggest market, Afghanistan

is no longer a budding space for

Pakistani cement exports—given its

increasing reliance on India, Iran and

Central Asian countries—however,

Pakistani cement manufacturers could

be looking at Uzbekistan which has

suddenly become more accessible to

Pakistani exporters with the signing of

Transport Internationaux Routier (TIR).

Pakistani exports can go straight to

Torkham through the Afghanistan

border on road.

As a surplus producer of cement, it is

important for export markets to remain

open for the industry, especially as it

embarks on a fourth expansion cycle in

recent history.

Over the next few years, the industry

may touch a 100 million tons, adding

18 million tons of capacity within the

next two years.

It’s confidence in domestic demand is

unwavering, it seems.

( Excerpt BR )

TRADE CHRONICLE - May - Jun - 2021 - Page # 22


TRADE CHRONICLE

Lucky cement and Sinoma sign

agreement for renovation of WHRP

A Chronicle report

An agreement on a renovation project

of a waste heat recovery power plant

was signed between China Sinoma

Energy Conservation Limited (Sinoma

EC) and Lucky Cement last weekend.

The generating capacity of the two

power stations - Lines CD and 01

(former AB) of the Pezu Plant in Darra

Pezu, Khyber Pakhtunkhwa - utilising

waste heat is expected to increase by

about 4MW after the transformation.

The agreement

came after a

contract entered

between the

two sides on

a 7500t/d

supporting

power station

project with

waste heat of

cement in late

March this year,

according to

China Economic

Net (CEN) recently.

Sinoma EC, a patent-holding

company specialised in energy-saving

and emission-reduction, started

cooperation with Lucky Cement in

2008. Since then, it has undertaken

several projects, including the Pezu

Lines AB and CD waste heat recovery

power plant with a generating capacity

of 10 MW respectively, the 15 MW

Karachi Line EFG power plant with

waste heat, Karachi Line H waste heat

boiler extension, etc.

Waste thermal energy is one of the

largest sources of inexpensive and

Cherat Cement Co gets approval to set up

a greenfield cement plant in KPK

Cherat Cement Co.

Ltd (CHCC) informed

the Pakistan Stock

Exchange Limited

(PSX) that the Board

of Directors of the

Company, in its meeting held on June

24, 2021, has approved a greenfield

cement plant installation at D.I. Khan,

Khyber Pakhtunkhwa Province in

Pakistan.

clean energy available.

Waste heat power

generation, or Waste

Heat to Power (WHP), is

the process of recovering

waste heat and using it to generate

power with no combustion and no

emissions. In cement plants, heat

generated through rotary kiln preheater

(PH) and AQC exhaust hot gases

are used to generate steam in steam

generator (Boiler) which is further used

to generate electricity/power through

steam turbo generator (STG).

Recovery of waste heat helps reduce

energy costs

for industrial

processes. By

using the waste

heat to generate

emission-free

electricity,

industrial users

can put wasted

energy back

into the process

that created it,

route the power

somewhere

else in the facility, or sell it to the grid

to support clean energy production,

distribution and use. Moreover, such

practices are in conformity with the

initiative to build a green CPEC (China

Pakistan Economic Corridor).

Due to the upgraded epidemic control

protocols, Lucky Group appointed

Muzamil, head of the Pezu Waste Heat

Power Plant to complete the signing

ceremony in a simplistic way with

Chinese counterparts Wang Jianfeng,

Vice Director of Marketing Department

of Sinoma EC International Engineering

Branch, and Marketing Manager Liu

Geng.

According to

Azam Faruque,

Chief Executive of

the Company, the

plant will have an installed production

capacity of 11,000tpd of clinker. The

project’s total cost is estimated to

be approximately PKR 34 bn, with

completion of the project expected in 3

years.

In addition, the Board has approved the

acquisition of certain assets, including

immovable property and mining leases

in D.1. Knan from a company for a price

Bangladesh next fiscal

budget offers incentives for

the cement industry

Bangladesh National Budget for 2021-

2022 (July –June) presented by A H M

Mustafa Kamal, Minister of Finance,

in Parliament on 03 June. During his

speech, the minister had acknowledged

that cement, iron and iron products are

the critical components of infrastructural

development. Therefore, if tax incentive

is provided to these industries engaged

in producing these items, development

of physical infrastructure will be easy

and cost-effective. Therefore, in this

context, he proposes reducing the

tax rate on the import of raw material

related to cement production from 3

per cent to 2 per cent. Likewise, he

also offers to reduce the tax deduction

rate at source on supply of cement, iron

and iron products from 3 per cent to 2

per cent. He expressed hope that these

measures will help these industries

flourish and enable them to make a

positive contribution to the country’s

infrastructural development.

In addition, the finance minister cut

corporate tax rates by 2.5 percentage

points to 30 per cent for the listed

companies and 32.5 per cent for the

non-listed ones. As expected, the

mega projects, whose completion are

expected to raise Bangladesh’s GDP

by as much as 4 per cent, got about

48 per cent more allocation in the

upcoming fiscal year, as part of the

government’s push to ensure their

timely implementation. Seven of the

eight mega projects -- Padma bridge,

Dhaka mass rapid transit line-6 (Metro

Rail), Chattogram-Cox’s Bazar rail

link, Rooppur nuclear power plant,

Matarbari 1,200MW coal-fired power

plant and the Payra deep seaport -- will

get Bangladeshi Taka 370 bn in fiscal

2021-22, in contrast to Tk 254 bn this

fiscal year.

of PKR 1.3 bn.

An Analyst of Foundation Research

in welcoming note stated that CHCC

currently has an installed capacity of

4.5Mta at Lakrai, Nowshera. After the

commencement of the announced

capacity, the total capacity will be

increased to 8.0Mta. It is to remind

here that CHCC cement dispatches

increased by 12.9 per cent YoY in

9MFY21, and plant capacity utilization

remained at 88 per cent in 9MFY21

compared to 78 per cent in 9MFY20.

TRADE CHRONICLE - May - Jun - 2021 - Page # 23


TRADE CHRONICLE

A remarkable growth in cement

dispatches recorded in Pakistan

All Pakistan Cement Manufacturers

Association (APCMA) has documented

remarkable growth in domestic and

exports dispatching of cement for May

2021 alone and 11MFY21, last week. It

registered an increase of 49.86 per cent

in May 2021, when total cement/clinker

dispatches were 3.947Mt against

2.634Mt against the same month

of last fiscal year. Whereas, during

11MFY 21, total cement dispatches

stood at 52.222Mt, reflecting 20.91 per

cent higher than 43.189Mt of cement

dispatched during the eleven months

of last fiscal year.

May breakup

The breakdown showed domestic

cement dispatches during May 2021

increased to 3.201Mt from 2.271Mt

in May 2020, depicting a healthy

increase of 40.95 per cent. Exports

also massively increased by 105.56

per cent, from 363,174t in May 2020 to

746,550t in May 2021.

In May 2021, the North based cement

mills dispatched 2.713Mt of cement

in local markets, showing an increase

of 35.55 per cent over 2.001Mt

dispatches in May 2020. Exports from

Flying Cement Company slates

expansion to complete in 3QFY22

Flying Cement Company Ltd. (FLYING)

announced that its plant expansion due

to come online in 3QFY22, located in

Mangowal, District Khushab, in Punjab

province of Pakistan. It has an existing

clinker production capacity of 4,000tpd

(Line-I) while FLYING is currently

undertaking an expansion in Clinker

production capacity - Line-II – by an

incremental 7,700tpd; the Company

is thus expanding its total clinker

production capacity to 11,700tpd.

Out of the total projected cost (i.e.,

PKR 10.2bn) for the expansion,

the Company has already incurred

PKR7bn.

Management plans to achieve

utilization of 35% in FY22 (incorporating

total capacity of new plant which will

be available in 2HFY22). It is also

expecting to target an 8 per cent market

share post-expansion in 3QFY22.

North based mills that, due

to covid-19 issues was just

7,520t in May 2020 showed

a healthy increase to 203,625

tons in May 2021.

South-based mills dispatched 487,311t

cement in domestic markets during

May 2021, registering a robust increase

of 81.15 per cent compared to the

dispatches of 269,003t in May 2020.

Exports from the South also increased

by 52.66 per cent to 542,925t in May

2021 from 355,654t during the same

month last year.

Collective dispatches 11MFY21

During this period, total cement

dispatches (domestic and exports)

were 52.222Mt, which are 20.91 per

cent higher than 43.189Mt of cement

dispatched during 11MFY20. Out of

this total, local dispatches increased

by 20.26 per cent to 43.451Mt from

36.13Mt, while exports increased

from 7.059Mt to 8.771Mt, showing a

growth of 24.25 per cent during under

reference period.

During 11MFY 21, North-based mills

dispatched locally 36.722Mt, which

was 18.67 per cent higher than the

dispatches during the last budgetary

period of 30.943Mt. Exports from North

were 2.365Mt, showing an increase of

Meanwhile,

F l y i n g

C e m e n t

Company has

informed Pakistan Stock

Exchange (PSX) Thursday

that the Company has

completed installing a

new captive power plant

of 12 MW at its site in

Distt. Khushab and its trial

operations are expected

to be started next month,

hopefully.

This captive power

plant will eliminate the

dependency on WAPDA and enable

the Company to be self-reliant in power

consumption whilst also resulting in

significant cost saving on account

of power in the future. The power

plant will be based on coal being the

economical source of fuel.

Earlier, the Company had installed

a 7.5MW WHR, which was

commissioned in Feb’21. Line-1 has

22.89 per cent over exports of 1.924Mt

during the same fiscal year.

Local despatchers from South-based

mills were 6.729Mt during this period,

29.73 per cent higher than 5.187Mt

dispatched during the corresponding

period of last fiscal year. The exports

from the South recorded 6.406Mt,

registering an increase of 24.76 per

cent over exports of 5.135Mt during the

same period the previous year.

APCMA budget submissions

The federal budget for 2021-22 is

expected on June 11. The APCMA

takes this opportunity and highlights

problems/suggestion on the radar of

the government. A representative of

APCMA said that the cement industry

is subject to a FED of Rs. 1500 per

ton and GST of 17 per cent of the

maximum retail price, and these taxes

calculate to around Rs. 170 per bag. He

appealed to the government to abolish

the FED and reduce other duties and

taxes to provide an opportunity to the

manufacturers to control their cost

of production and further optimize/

expand their pant that will help generate

more employment and revenues for the

government.

a capacity of 4,000tpd with a 17MW

energy requirement, while Line 2,

with a capacity of 7,700tpd of clinker,

has a 32MW energy requirement.

Thus, the total energy requirement of

FLYNG hovers at 49MW. As against

this requirement, FLYING has a total

energy source of 58.5MW, including

Load connection from WAPDA (25MW),

WHR System (7.5M), Furnace Oil

Engines (14MW), and Captive Power

Plant (12MW).

TRADE CHRONICLE - May - Jun - 2021 - Page # 24


TRADE CHRONICLE

People & Events

Zulfiqar Younus appointed

Member FBR

Federal Board of Revenue (FBR)

has appointed Zulfiqar Younus, as

Member FBR, (on promotion to BS-21).

According to FBR notification issued

recently, he has assumed the charge

of the post.

Coca-Cola appoints Aisha Sarwari

as director public affairs

The Coca-

Cola Export

Corporation,

Pakistan has

appointed Aisha

Sarwari as the

new Director,

Public Affairs,

Communications

a n d

Sustainability,

for Pakistan and Afghanistan region.

She joins at a time when the Company

identifies Pakistan as the largest

market in the region, and also a time

of global restructuring to instil a flat and

integrated system that gains enterprise

efficiencies amidst the Covid-19

pandemic.

Aisha brings over 18 years of leadership

experience in communications, public

relations and sustainability across

several industry sectors and the

Government. Her early career was

in the US with international news

organisations including CNN and

National Public Radio. Her consulting

and programme work spans the Bill

and Melinda Gates Foundation, USIP,

and the World Bank. She has also

KPT chief visits Ferry Terminal Shed

Chairman KPT Nadir Mumtaz Warraich

alongwith General Manager (CW/E) paid

a visit to Ferry Terminal Shed to evaluate

FBR also notified that Muhammad

Waqas Hanif, a BS-19 officer of Inland

Revenue Service (IRS) has been

appointed as Director (OPS) to Special

Assistant to Prime Minister on Finance

and Revenue/ Minister of State. He

has relinquished the charge of the post

Additional Commissioner-IR, Corporate

Tax Office, Islamabad.

Waqas Ahmed, a BS-18 officer of IRS

appointed as Secretary (OPS) (HRM-

IR-III), FBR, Islamabad.

FBR also notified that Muhammad

Nayyar Shafiq, a PCS/BS-20 officer

has been appointed as Collector,

Collectorate of Customs (Adjudication),

Faisalabad

previously worked with

Adam Smith International,

USAID, the Punjab Board

of Investment, and most

recently Jazz.

“Aisha’s wide experience and expertise

fulfil the prerequisites for this important

leadership role, especially amidst the

pandemic, and it will prove to be an

asset for the company, while exploring

new modes of Coca-Cola brand’s

story-telling. We are looking forward

to her strengthening relations with our

stakeholders and supporting business

sustainability,” stated Fahad Ashraf, VP

and General Manager for Pakistan &

Afghanistan region at The Coca-Cola

Export Corporation.

In addition to two published books,

Aisha has been an opinion-former in

Pakistan and abroad for several years,

raising awareness about the need to

advance women economically. Her

opinion pieces have been featured

in The Guardian, BBC World and

NPR. In Pakistan, she has been a

regular contributor to The Express

Tribune and Dawn.com. She is a

Dean’s Scholar from San Jose State

University, California, in media and

communication, and is currently based

out of Islamabad.

progress. According to

KPT, the development

work was taking place

at the port for the fulfillment of future

requirements of the global shipping

sector.

Imran Ahad made HBFC MD

Imran Ahad has

been appointed as

Managing Director

& Chief Executive

Officer of House

Building Finance

Company Limited

(HBFC).

Imran is a seasoned banker with

vast experience of working in senior

leadership roles in many countries

across the Middle East as well as in

Pakistan. He has been associated with

some of the leading international banks

throughout the span of his career

including BCCI, Standard Chartered

Bank and NIB Bank where he held

various senior level positions. He has

recently moved back to Pakistan from

the UAE to take up this assignment.

Commenting on his new role as

managing director HBFC, Imran said,

“With a strong commitment to the

country; HBFC’s deep knowledge of the

housing sector uniquely positions us

to take advantage of the opportunities

that exist in the market.”

Shamshad elected as

first woman chairperson of

PSX board

For the first

time in the 73

years history

of Pakistan

S t o c k

Exchange

(PSX), a

w o m a n

chairperson

has been

elected on the board of directors on the

bourse. The decesion was taken in the

first meeting of the newly-elected PSX

Board held recently when the former

Governor of State Bank of Pakistan

(SBP) Dr Shamshad Akhtar has been

unanimously elected as the PSX Board

Chairperson.

Dr. Shamshad Akhtar needs no

introduction as she is a veteran of the

financial markets of Pakistan and has

also held the honourable position of

Governor, State Bank of Pakistan, in

the past.

TRADE CHRONICLE - May - Jun - 2021 - Page # 25


TRADE CHRONICLE

Indus Motor pays homage to Late Ali Habib pledging

support to Shaukat Khanum Cancer Hospital

As a tribute to the late Ali Suleman

Habib, Founding Chairman of Indus

Motor Company (IMC), the Company

has pledged support to the Shaukat

Khanum Memorial Cancer Hospital

& Research Centre

(SKMCH), through

a Rupees 60 Million

donation towards

the hospital’s under

construction facility at

Karachi.

Indus Motor’s Vice

Chairman, Shinji

Yanagi and Chief Executive, Ali Asghar

Jamali presented the cheque to Prime

Minister, Imran Khan, at Islamabad.

Sharing his thoughts on the occasion,

Mr. Jamali said: “IMC’s association

with the Shaukat Khanum Cancer

Hospital stretches back over two

Imran Yaqoob Minhas made

new Karachi police chief

Sindh government appointed Imran

Yaqoob Minhas as Karachi Police

Chief, who replaced the outgoing

Ghulam Nabi Memon.

According to details, AIG Karachi

Tariq Malik to take charge as

new Nadra chairman

New Nadra Chairman Tariq Malik will

take charge of his new responsibilities

soon. Tariq Malik is currently working

as adviser to the UN Secretary

General in New York. He has asked

the UN Secretary General to relieve

him from his responsibilities after his

appointment as Nadra chairman.

Tariq Malik is son of eminent scholar and

educationist Prof Fateh Muhammad

Malik. The Government of Pakistan had

advertised the post of Nadra chairman

to which 109 candidates applied. Tariq

decades. Cancer treatment in Pakistan

is very expensive and beyond reach

of the common man. This is where the

SKMCH steps in and provides the much

needed support to the less privileged

of our country and I congratulate its

management for a commendable job.

This pledge pays homage to our late

Chairman, Ali Habib san and the legacy

he’s left behind. It not only serves as

sadqae jaaria but also an aide-memoire

of his compassion and kindness that he

possessed.’

Ghulam Nabi Memon has been

transferred as the Additional

Inspector General (AIG) Special

Branch. Previously, Imran Yaqoob

Minhas was posted as AIG Special

Branch.

The new police chief had served as

Karachi’s IG Traffic, and AIGP Special

Branch.

Ghulam Nabi Memon has served as the

city police chief for nearly 10 months

after he was appointed to the post

on July 15 last year when the Sindh

government made a major reshuffle in

the provincial police department after

the passage of the new police order.

Malik was selected after tough

competition among the short-listed

candidates. He has also served

as Nadra chairman previously. He

is currently serving as chief technical

adviser in the UN.

The SKMCH at Karachi is the third and

most modern cancer facility being built

on 20 acres of land at DHA City where

over 75 percent cancer patients will

receive free cancer care. Construction

is expected to be completed over a

period of three years at an estimated

cost of Rs.13 billion with state-of-theart

diagnostic, radiation and treatment

facilities under one

roof, catering to

patients in Karachi,

Sindh and Baluchistan.

According to a WHO

report, in 2020 there

were over 178,000

new cancer cases and

177,000 plus cancer

deaths documented in Pakistan. Over

the next five years, the number of

prevalent cases has been estimated to

reach an alarming 329,524 cases, the

most common cancers in both sexes

related to breast, oral cavity, lung,

digestive tractand leukaemia.

FINCA appoints CEO

The board

of directors

of FINCA

Microfinance

Bank Limited

has appointed

Jahanzeb Khan

as the new chief

executive officer

(CEO) of the

bank, a statement said recently. An

experienced business leader, Khan will

assume responsibilities as the bank

CEO on June 14, 2021, it added.

“With Jahanzeb’s extensive and global

experience in fintech, we are delighted

to welcome him to the FINCA family

and believe that his rich diversity and

history of work lends itself to FINCA’s

vision for the future, said Zar Wardak

| vice president and division director of

FINCA Impact Finance.

We strongly believe that Jahanzeb is

the right leader for FINCA Pakistan and

we wish him all the best in his new role.”

Prior to Telenor Microfinance Bank,

Khan had been successfully associated

with one of the largest financial services

institutions (JPMorgan Chase & Co.),

Blue Chip Management Consulting firm

(Deloitte Consulting) and the Fintech

startup - First USA Bank (acquired by

JPMorgan), it added.

TRADE CHRONICLE - May - Jun - 2021 - Page # 26


TRADE CHRONICLE

KATI praises the appointment of Mahmood Maulvi as

Special Assistant for Maritime Affairs

Patron-in-Chief of Korangi Association

of Trade and Industry (KATI) SM Muneer

and President Saleem-uz-Zaman

praises the appointment of Senior Vice

President of Pakistan Tehreek-e-Insaf

(PTI) the Karachi Division, Mehmood

Moulvi as

Special Assistant

to Prime Minister

Imran Khan on

Maritime Affairs.

Welcoming the

move, they said

that Mehmood

Moulvi is

a beloved

personality of

the industrial

and business Mr. SM Muneer

community of

the country. Mahmood Maulvi is highly

regarded in business, political and

social circles for his ability and wisdom.

Engro Polymer plans to setup

Circular Plastics Institute

Engro Polymer and Chemicals Limited

(EPCL) plans to establish a Circular

Plastics Institute (CPI), a not-for-profit

thinktank, to promote research and

development in Pakistan’s circular

plastics economy. Pakistan faces the

pervasive problem of plastic pollution

as the country generated 3.9 million

tons of plastic waste in 2020, and it has

the highest percentage of mismanaged

plastic in South Asia.

In line with Engro’s central idea of

solving the most pressing issues of our

time, the CPI is aimed to be a pioneer

establishment in Pakistan that will

streamline efforts towards the circular

economy through knowledge exchange

and collaboration across Government,

businesses, and civil society sectors.

By rethinking its plastic problem,

Pakistan can benefit from effective

resource management to support job

creation and innovation in the economy,

while also conserving the environment

through lower plastic waste. Globally,

countries like Sweden and Germany

are reaping the benefits of promoting

a circular economy by making it a key

part of government policy.

According to Jahangir Piracha, CEO of

EPCL, “While the demand for plastics is

growing every year, the main problem

Earlier, Mahmood Maulvi had been

performing his duties as an advisor to

the Ministry of Coastal Affairs in a very

cheerful and skillful manner. During this

time he played a key role in resolving

employee issues.

Mehmood

Moulvi has vast

experience in

maritime affairs.

They hoped

that Mahmood

Maulvi, now in

a very important

position, would

play his full role

in identifying

and resolving all

Mr. Saleem-uz-Zaman issues related

to the business

community, port and shipping and

coastal affairs across the country.

is its responsible collection

and disposal. Customization of

global best practices, coupled

with local knowledge, is needed

to reach our sustainable development

goals. Once established, the Circular

Plastics Institute will take us a step

closer towards our vision of enabling

a zero-waste future. This platform

will also aim to increase economic

activity in Pakistan by instilling circular

economy principles, eliminating waste

and safeguarding natural resources.”

The CPI will be designed by

Maleeha Habib, a student of Harvard

University’s Extension School. “Engro’s

establishment and support of CPI

will open critical areas of opportunity

for Pakistan including collaboration

with international organizations,

conservation of natural ecosystems,

reduction of environmental impact,

improvement of health and well-being

for its citizens

and economic

development

through innovation”

said Will O’Brien,

Capstone Advisor,

Global Development

P r a c t i c e ,

Sustainability,

Harvard University

Division of

Continuing

Education.

Saleem Khan made director

press information Sindh

Muhammad Saleem Khan, Senior

Director of Information Department,

has been posted as Director Press

Information, Information Department

Sindh.

In this regard, a notification has

been issued by Services, General

Administration and Coordination

Department on Monday.

Muhammad Saleem Khan possesses

more than 31 years experience in the

field of media management and public

relations.

He has worked as Press Secretary

to Governor Sindh, Public Relations

Officer to Governor Sindh, Public

Relations Officer to Chief Minister

Sindh and various provincial ministers

and advisors.

Acknowledging the need of CPI

for Pakistan Fahd Khawaja, Chief

Commercial Officer of EPCL said “It

is important to provide a platform to

all stakeholders including students,

government officials, policy makers

and public at large to educate them

about the concept of circularity/circular

economy and recycling.”

A virtual signing ceremony of this

initiative was organized in the presence

of Jahangir Piracha (CEO of EPCL),

Will O’Brien (Capstone Advisor), Judith

Rodriguez (Capstone Instructor, Global

Development Practice, Division of

Continuing Education), Fahd Khawaja

(Chief Commercial Officer of EPCL),

Maleeha Habib (graduate student of

Global Development Practice, Harvard

University’s Extension School) and the

Management team of EPCL and Engro

Foundation.

TRADE CHRONICLE - May - Jun - 2021 - Page # 27


TRADE CHRONICLE

Vaccination Center in KATI

CCI Pakistan announces

USD 50 million investment

for 7thProduction Plant

Government of Sindh Spokesman,

Advisor to CM Barrister Murtaza Wahab

inaugurating COVID-19 vaccination

center in KATI, Parton-in-Chief SM

Muneer, President Saleem-uz-Zaman,

Zubair Chayya, Irfan Salam, Gulzar

Feroz, Johar Qandhari, Shaikh Umer

Rehan & Zaki Ahmed Sharif are

also present.

SBCA official to be deployed at KCCI: DG

Chairman Businessmen Group (BMG)

& Former President Karachi Chamber

of Commerce & Industry (KCCI) Zubair

Motiwala and President KCCI Shariq

Vohra presenting crest to Director

General Sindh Building Control

Authority (SBCA) Shamsuddin Soomro

during his visit to KCCI.

Law and order in Korangi will be maintained

A delegation of Coca-Cola Beverages

Pakistan Limited (CCI Pakistan), GM

Ahmet Kursad Ertin met with the Prime

Minister of Pakistan and announced

an investment of USD 50 million for a

Greenfield project the company plans

to set up in Haripur district, Khyber

Pakhtunkhwa (KP).

This will be CCI’s 7th the production

facility in the country. Construction of

this new state-of-the art plant site is

scheduled for completion by the first

quarter of 2022. It will mainly cater

to the beverage needs of northern

Pakistan.

During the meeting, Mr. Ahmet Kursad

Ertin presented the company as a

leading member of Pakistan-Turkey

Business Council and one of the

largest private Turkish investors in

Pakistan, which is paving the way for

other Turkish investors.

KATI President Saleem-uz-Zaman

presenting shield to SSP Korangi

Shahjahan Khan, Zubair Chhaya,

Danish Khan, Deputy Commissioner

Korangi Arfan Salam, SSP Traffic

Dutch ambassador visits

FCEPL’s dairy plant

The Ambassador of Kingdom of

Netherlands to Pakistan, Mr. Wouter

Plomp, visited FrieslandCampina

Engro Pakistan Limited’s state of the

art manufacturing facility in Sahiwal

this week for a guided tour of the dairy

plant and farms.

During the tour, Mr. Plomp was given

a thorough briefing on the operations,

Latif Siddiqui, Zaki Ahmed Sharif,

Nighat Awan, Syed Johar Qandahari,

Masood Naqi, Sheikh Fazale-Jalil and

SM Yahya were also present on the

occasion.

from milk procurement, milk collection,

and quality checks to supply chain

and production. A tree plantation

was also carried out along the dairy

plant as the Dutch Ambassador’s

contribution to the Billion Tree Tsunami

Project. FrieslandCampina Engro

Pakistan Limited is a Pakistani dairy

company which is a subsidiary of

Royal FrieslandCampina, a Dutch

multinational dairy cooperative.

Bringing 150 years of experience to the

dairy landscape of Pakistan, FCEPL is

committed to transforming the health

According to the delegation, the

proposed project will not only bring

major investment to the region but also

create direct and indirect employment

opportunities and revenue generation

for the Government as well as for third

party suppliers, vendors & distributors.

and wellbeing of Pakistanis by ensuring

the supply of safe and quality milk

while also enhancing the livelihood of

farmers. Headquartered in Karachi,

the Company operates two processing

plants in Sukkur and Sahiwal.

TRADE CHRONICLE - May - Jun - 2021 - Page # 28


TRADE CHRONICLE

Automobile News

General Tyre evolves to reiterate its market leadership

through technological advancements

Reflecting a fresh outlook, General

Tyre and Rubber Company (GTR) one

of the country’s premier suppliers of

tyres, is rebranding itself to resonate

more effectively with a younger

demographic which forms bulk of

the company’s customer base. The

organization will now carry a revamped

logo to assert itself as a name which

has been synonymous with road safety

and ride performance for more than 50

years. The new logo is a vibrant and

distinct take to rejuvenate the image in

the minds of its target audience.

GTR is one of Pakistan’s largest

manufacturer of tyres which provides a

complete range of tyres in all segments

across Pakistan. The company

was founded in 1963 and has since

upheld a strong presence within the

industry for being a leader through

innovation in product development and

passenger safety. GTR tyres undergo

rigorous testing both locally as well as

internationally in Europe and Japan.

May 2021: Industry sales falter

on extended Eid holidays

In May 2021, Auto industry sales fell

9% mom to c.15,700 units, on account

of lower production (down c.10% mom)

amid reduced working hours at the

tail-end of Ramadan and unusually

long Eid holidays (to tame the rise in

Covid-19 cases), in our view. Despite

the reduced work hours, the industry

was able to contain the decline, as

the resolution of supply-chain issues

enabled a ramp up of production

following the holidays. PSMC added

most units to total industry sales.

Among INDU models, Hilux volumes

cushioned the overall decline in sales

(up 22% mom), while the remaining

models fell by an average 15% mom.

We expect an uptick in both production

and sales in June, due to the easing

of lockdown restrictions and robust

demand. HCAR sold c.2,000 units in

May, with combined sales of Civic and

City of c.1,600 units, down 23% mom.

We believe that the decline was due

to the phasing out of old City, prior to

The company also makes sure that

90% of its raw materials are imported

from high quality and verified sources.

GTR the new logo is a personification

of the company’s dynamic vision to be

the leader in tyre technology through

quality improvement, competitive

prices, customers’ satisfaction and

the launch of the 6th generation

model (potentially in July). BR-V

sales rose a sharp 80% mom to

c.400 units.

PSMC’s Cultus sales rose a sharp

c.40% to c.1,800 units, due to

improvements in the supply-chain,

in our view. Despite the c.20% mom

decline, Alto sales remained above the

3,000 units’ level for the fifth sequential

month. We expect PSMC sales to

continue the present momentum in the

remainder of CY21, where the impact

of new competition is likely to remain

moderate, in our view. We highlight that

the positive Budget measures such as

the reduction in FED on the Economy

segment will boost volumes further.

Tractor industry recorded sales of

c.4,200 units, down 6% mom. AGTL

sales remained flattish mom, while that

of MTL declined a modest 9% mom to

c.2,900 units. We expect tractor sales

to resume the uptrend in the coming

months as farmer income continues to

expand, ahead of the Rabi harvesting

season. MTL sales may also benefit

meeting social obligations.

Speaking on the development, Hussain

Kuli Khan, CEO/M.D, General Tyre and

Rubber Company of Pakistan, stated;

“The visual cues like logos and taglines

speak volumes about what it stands for

and how it envisions to deliver the core

offerings to customers. Our rebranding

efforts focuses on distributing a

message that the company is staying

connected with its customer base in a

sustainable manner. Our products are

rigorously tested and designed with

Pakistani roads in mind to ensure user

satisfaction to the highest levels. The

revamped logo and identity signify this

approach with a fresh outlook towards

future prospects.”

General Tyre has and still supplies all

the leading automotive companies in

the country with their tyres. In 2021, a

milestone of manufacturing more than

40 million units since establishment

was achieved by the company. The

organization has also been recognized

by Forbes as Asia’s best under a billion

companies.

from an increase in exports. May

witnessed a drop in sales following

reduced working hours. The lowerfor-longer

interest rates and influx of

new models in the sector, will maintain

the robust demand for cars, in our

view. The removal of FED (2.5%) and

reduction in GST to 12.5% (vs. 17%)

for cars up to 850cc will spur additional

demand for the Economy segment, in

our view. PSMC being the only listed

economy segment OEM, is likely to

witness a strong positive reaction in its

stock price, in our view. We have an

Overweight stance on both the Auto

and Tractor OEMs, with Buy rating

on all the scrips under coverage. We

prefer PSMC (TP of PKR450/sh), INDU

(TP of PKR1,458/sh), and MTL (TP of

PKR1,460/sh), as our top picks.

TRADE CHRONICLE - May - Jun - 2021 - Page # 29


TRADE CHRONICLE

NBP, MTL sign MoU

A Memorandum of Understanding

(MoU) has been signed virtually

between National Bank of Pakistan

(NBP) and Millat Tractors Ltd (MTL)

for collaboration between the two

organizations for the development and

promotion of farm mechanization on a

nationwide basis.

The objectives of this MoU are

to increase the disbursement of

institutional credit for tractors and

farm implements to eligible farmers in

Pakistan through mutual efforts of both

Parties and to improve the financial

literacy of farmers and entrepreneurs

to encourage them to avail credit facility

from NBP.

IMC gives the Fortuner a

fresh look

Indus Motor Company (IMC), launched

the much awaited Toyota Fortuner

model lineup which has been given a

fresh look. Toyota Dealers across the

country are now booking orders from

customers with an upfront payment of

Rs 3 million, for a diesel or gasoline

engine available in three new variants

i.e. Fortuner Sigma 4 (4X4 1GD Hi

Diesel), Fortuner V (4X4 2TR Hi Petrol)

and Fortuner G (4X2 2TR Std Petrol).

The ex-factory RSP range between

Rs.7.99 million and Rs 9.65 million.

The Company’s Chief Executive,

Mr Ali Asghar Jamali, observed,

“The Fortuner is in a league of its

own. The SUV undeniably, is great

value for money, offering unmatched

Uber appoints new Country Head for

Pakistan, GM for MENA and Pakistan

Uber, the global

ride-hailing

platform that

seamlessly

connects drivers

with riders, has

announced the

appointment of

Shahid Khan

as the new

Panther Tyres, Al-Ghazi

sign pact

Panther Tyres has entered into a

contract with Al-Ghazi Tractors Ltd for

regular supply of tractor tyres which will

Millat Tractors Limited is Pakistan

leading Tractor Company, established

in 1964. They are engaged in the

manufacturing and marketing of the

world-renowned Massey Ferguson

(MF) tractors and a range of allied

agricultural and industrial implements.

They offer ten models of tractors in

the range of 50 hp to 100 hp, diesel

generating sets of capacities 12.5

kVA to 150 kVA and 3, 3.5 and 4 ton

forklift trucks. Presently MTL is holding

approx. 70% share of the local tractor

market in the country. NBP and MTL

will cooperate to identify and carry out

joint marketing activities to support

tractor purchases by farmers. Such

activities may include joint sales calls to

prospective customers and trade show/

performance and power which is why

customers have been vying its arrival.

The newly added features are sure to

please the discerning taste and needs

of our premium customers and new

buyers.”

Adding further, he said, “Under the

Government’s ‘Roshan Apni Car’

scheme, non-resident Pakistanis will

soon be able to purchase vehicles

for their families from the Company

Country Head for Uber

in Pakistan. He has

replaced Saad Naveed

Pall, who has been

promoted to the position of General

Manager across the Middle East, North

Africa, and Pakistan (MENAP) region.

Shahid Khan has been previously

affiliated with the company as the

Head of Operations in Pakistan. With

this promotion, Shahid will be heading

Uber in the country, and will be looking

have a positive impact

on the annualrevenue

andconsequently

increase the bottom

line of the company,

said PSX filing

recently.

seminar support and participation.

NBP is Pakistan’s largest publicsector

commercial bank, providing a

diverse range of products and services

to the agriculture sector. The Bank

is taking initiatives for increasing

market penetration and growth in the

priority sectors of the economy by

developing and strengthening value

chains between producers, processors,

exporters and financial institutions.

under the scheme. IMC is supportive

of this initiative and will facilitate such

customers with preferential vehicle

delivery times.”

All 3 variants have a new Prestigious

Exterior look, a more Premium Feeling

Interior, and for the Diesel variant, a

Performance Refinement. Notable

spec features in the flagship model

include new generation 1GD engine

with power, torque and fuel-efficiency

improvements, addition of Variable

Flow Control in the steering which

improves steering feel based on vehicle

speed, improved drive modes, Electrochromic

rear-view mirror and Balance

Shaft addition in the engine which

significantly improves the NVH of diesel

variant. To further augment the traction

control system, Limited Slip Differential

functionality has also been included.

after the overall Uber operations,

rider recovery, driver engagement,

community partnerships, with a strong

focus on innovation and advanced

technologies to bring enhanced user

experience on the app.

Shahid Khan holds a Master’s degree

from INSEAD and brings more than 18

years of experience across different

functions from various corporations,

including Maersk Line, K-Electric and

Careem.

TRADE CHRONICLE - May - Jun - 2021 - Page # 30


TRADE CHRONICLE

Ports, Shipping & railway

Tariq Haleem hails the appointment of Mahmood Moulvi

as Special Assistant to PM for Maritime Affairs

President Pakistan Stevedores’

Conference (G) Ltd, Tariq Haleem,

has hailed Mr Mahmood Moulvi as

Special Assistant to the Prime Minister

of Pakistan Imran Khan, for Ministry of

Maritime Affairs, Govt of Pakistan.

Special Assistant to the PM.

He expressed hope that Mahmood

Moulvi would trigger off speedy

improvement and progress of all Ports

of Pakistan.

Tariq Haleem expressed his heartiest

congratulations on Mahmood induction

into the cabinet, a notification for which

appointment was issued last Tuesday.

While congratulating Special Assistant,

the President Pakistan Stevedores’

Conference said that Mahmood Moulvi

has vast experience handling the dayto-day

business of shipping in all its

varied aspects. In addition, he has close

contacts with all the relevant persons in

the port and maritime sector, and we

are sure that he will be a role model

Shipping agents seek amendments

to trans-shipment rules

In its Budget 2021-22 proposals shared

shared with media, the Pakistan Ship’s

Agents Association (PSSA) urged the

government to facilitate re-export of

shipments by amending trans-shipment

rules as it was shifting businesses

from local ports to other facilities in the

region.

The PSSA asked

the government

to amend Rule

510A of SRO

03(I)/2021, Jan

4, 2021, related

to the “transshipment

of

imported cargo

from gateway

port to a foreign

port”. Under the

rules, only Full Con tainer Load (FCL)

or sealed cargo containers are allowed

for “International trans-shipment (IT)”

via seaports in Pakistan.

While ship agents have asked the

government to allow trans-shipment

of Less than Container Load (LCL)

cargoes too, which are forwarded

to the country of origin in the form of

Mahmood also announced it on

Twitter, thanking PM Khan and Federal

Maritime Affairs Minister Ali Zaidi for

“honouring” him with the position.

Tariq Haleem said, “We are sure that he

will always take a proactive approach in

the removal of all impediments causing

slow/negligible growth of Pakistan

merchant ships fleet, solving longpending

port-related projects – issues

and implementing the best facilities,

which are imperative for competing

with the regional ports”.

“grouped shipment” as

an international business

practice. Allowing LCL

cargo will enhance business

opportunities and revenue generation

for the sector, the association added.

The PSSA has asked for five

amendments in the Customs Act 1969,

including enhancing the limit of ocean

losses on bulk oil cargo to 0.50 per cent

of the manifested

quantity. The

other demand was

an amendment

in clause 24 (i)

of section 156

asking that the

“shipowner”

should be defined

as “shipowner not

as a local agent”.

The association

said that

amendments were needed in Section

55(1)(e) and 55(2) of the Customs Act

as under the current rules a shipping

agent is held liable for claims brought

by the owner of the goods even when

the agent has excluded his liability

under the Agency Agreement and in

situations where the agent was not

involved in default, negligence or willful

act.

Courtesy (DAWN)

Mahmood Moulvi

Tariq Haleem

We are confident that Prime Minister

Imran Khan’s vision of choosing a

person from the concerned sector

aware of ground realities will bear fruit.

Mahmood Moulvi “Hum main say hain”.

Tariq Haleem has assured Mahmood

Moulvi of the wholehearted support of

Pakistan Stevedores’ Conference (G)

Ltd (PSCGL) for the progress of ports

in Pakistan.

‘PQA’s reserve fund

crosses $700mln’

The Reserve fund of Port Qasim

Authority (PQA) has crossed $700

million (Rs110 billion mark) due to

strong financial performance of PQA

during the last three years, Minister

Maritime Affairs Ali Haider Zaidi said.

In his budget speech in the national

assembly, the minister added the

strong growth in PQA reserves is

possible due to hefty profit earned by

PQA in last three years and PQA will

make a record Rs19 billion net profit

this financial year which will be 23

percent higher than last financial year.

Interestingly, out of total PQA reserves

of Rs110 billion, Rs43 billion was added

during last three years compared

to Rs67 billion since PQA inception

in 1973. The minister said PQA has

paid Rs8 billion in taxes to federal

government during this financial year.

Zaidi said PQA has handled 57 million

tonnes this year which was 12 percent

higher than last year.

The minister added that he had not

allowed sale of a single acre during his

tenure and all PQA profits are based on

port commercial operations.

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TRADE CHRONICLE

Hutchison Ports Pakistan, the country’s

state-of-the-art deep-water port,

welcomes a new regular shipping

service brought by the consortium

comprising of Global Feeders, Sinokor,

Heung A, and Sea Lead. It strengthens

trade links through providing ease

of access to the booming markets of

South-East Asia, China, and Korea.

The service will provide much-needed

extra capacity for Pakistani exporters

through non-vessel operating common

carriers (NVOCCs) as well as mainline

operators. This service includes 5 ships

operating on a weekly basis.

All Pakistan Customs Agents

Association (APCAA) has suggested

amendments in the measures

proposed by the federal government

in the federal budget 2021-22 to avoid

anomalies in the customs clearance

process.

Talking to media, Arshad Jamal,

Chairman APCAA said that the

association had forwarded its proposals

to the Federal Board of Revenue (FBR),

suggesting several amendments in the

measures recommended in the federal

budget 2021-22 to avoid glitches in the

customs clearance process after its

implementation.

He said that the pasting of the invoice

and packing the list is a must on the

containers/LCL shipments for the

immediate release of consignments

before the filing of goods declarations

and no shipping agents or air cargo

agents accept any consignment without

the goods declarations, internationally.

However, in Pakistan, the shipping

agents bypass this condition and

Commenting

on this latest

development,

Raymond

Chan, General Manager & Head of

Business Unit of Hutchison Ports

Pakistan delightedly remarked:

“Pakistan’s economic growth in future

substantially counts on international

trades, especially exports. Hutchison

Ports Pakistan are always at the

forefront of introducing groundbreaking

service offerings that create seamless

trade links for Pakistan. CSC/SIS-II

is another cornerstone we reached

to bring vast arsenal of Pakistan’s

tradable commodities to the world”.

New shipping service commences

regular calling at Hutchison Ports Pakistan

Hutchison Ports Pakistan has been

Anomalies in clearance process: APCAA suggests

amendments in budget measures: chairman

Aden Ports Development Company

(APDC), has made the switch on

ZODIAC Terminal Operation System

(TOS) at their Aden Container Terminal

in Aden, Yemen, bringing the

cuttingedge technology into full-fledged

application at the terminal.

As one of ZODIAC’s first customers

transport the consignment against

international practices.

In the federal budget 2021-22, it is

proposed to impose heavy penalties on

the importers if the shipment invoice/

packing list was not found or pasted on

containers/packages or parcels.

He said that this condition would

not only increase examination and

create containers backlog at the

already congested ports but it would

also negate the concept of the single

window project, being propagated by

the government of Pakistan. Moreover,

he said that this condition should

be declared mandatory but without

penalties as the legal instrument

was goods declaration but not such

documents.

For the implementation of this condition

smoothly, the APCAA has suggested

that if the importer of the goods

mentioned the condition “pasting of

invoice/ packing list” on or inside the

containers or on LCL shipments in

ZODIAC Terminal Operating System delivers

upgrades to Aden Container Terminal

since 2012,

APDC has

c h o s e n

to stay

with ZODIAC software solutions in

upgrading their Zodiac 5.0 to Zodiac

7.1, which is one of the most advanced

and user friendly systems on the market

for ports and terminal management.

This means the enhancement of the

terminal’s operations will ensure a

smooth migration even during the

persistently uplifting trading connectivity

of Pakistan, by not just attracting and

handling at world-class productivity the

biggest container ships the country has

ever received, but also investing on

state-of-the-art technologies in cargo

handling and logistics. The organization

is constantly recognized by local and

international shipping community on

incredible agile performance as well as

customer-centric services.

the letter of credits, bank contracts,

performa invoice then no penalty may

be imposed on the importer of goods.

Furthermore, APCAA also

recommended that the shipping line

or shipping agent to ensure that the

invoice/ packing list was pasted on

containers or LCL shipments as per

international practices and mention

the invoice no, date, and amount on

the bill of lading and import manifest

and in case of no compliance, the

shipping lines or shipping agents would

be penalized with a maximum of Rs

25,000.

APCAA also proposed that all goods

declarants should be restricted to file

the true declarations along with the

copy of the bill of lading, transactional

invoice, and packing list, letter of credit,

bank contract, or any other banking

instrument, concessionary certificates

/NOC in terms of IPO and customs

tariff. And, if the goods declarants fail to

upload such documents, his profile may

be listed for the red channel and the

authorities may issue show cause and

impose the penalty of not more than Rs

25,000 against him, APCAA suggested.

COVID-19 pandemic, as ZODIAC

continues to provide to its customers

with complete support in accessing

global supply chains with high efficiency

and capacity.

TRADE CHRONICLE - May - Jun - 2021 - Page # 32


TRADE CHRONICLE

Telecommunication News

PTA renews cellular (NGMS) licenses

of three operators in AJK & GB

The cellular license renewal ceremony

for Azad Jammu & Kashmir and Gilgit

Baltistan was held recently at PTA

Headquarters, Islamabad. Three

Cellular Mobile Operators i.e. Telenor

Pakistan, PMCL (Jazz) and

PTML (Ufone) have deposited

payment (50% of the PTA

determined license fee)

amounting to PKR 3.19 Billion

against their license renewal

fee with PTA.

The event was attended

by Federal Secretary for IT

& Telecommunication, Dr.

Muhammad Sohail Rajput,

Chairman PTA, Major General

Amir Azim Bajwa (R); Member

Finance PTA, Muhammad

Naveed and Member

Compliance & Enforcement

PTA, Dr. Khawar Siddique

Khokhar; Executive Director,

Frequency Allocation Board (FAB);

Joint Secretary Gilgit Baltistan Council;

Deputy Secretary (Finance) and Deputy

Secretary (Welfare & Development)

AJ&K Council and senior officers of

PTA. CEOs of Telenor, Jazz and Ufone

PTCL signs MoU with GCU for providing

premium ICT services

Pakistan Telecommunications

Company Limited (PTCL), signs a

Memorandum of Understanding (MoU)

with Government College University

(GCU), during a ceremony organized

at GCU campus in Lahore. Under this

MoU, PTCL will offer students, alumni

and staff members with exclusive

discounted packages for premium

ICT services including seamless

telephone and internet services.

On the occasion, Nauman Durrani,

Executive Vice President (EVP)

Sales, PTCL, said, “We are glad to

partner with GCU and contribute to

the education sector by providing

students and staff members with

discounted packages to enjoy seamless

ICT service. With this collaboration

PTCL strives to provide cost-effective

connectivity solutions equipped with the

along with senior

representatives of

CMOs also attended

the event.

On the occasion, Chairman PTA lauded

the efforts of the cellular operators

for playing a crucial role in providing

connectivity across these regions. He

also appreciated the tireless efforts of

concerned officials of PTA, FAB and

MoIT for timely conclusion of the renewal

process. He further stated that AJ&K

and GB are the prime areas of tourism

in Pakistan and the license renewal will

latest ICT services

that will empower

students to focus

on their ideas and

execute them for a better future of

Pakistan. Through such partnerships,

pave the way for provision of 3G/4G

and Next Generation Mobile Services

to the consumers of these areas as

well to the tourists. Continuous efforts

are being made to bring state of the art

telecommunication services to far flung

areas enabling access to a multitude of

opportunities for businesses, education

and health.

On this occasion Secretary

IT & T, Dr. Muhammad Sohail

Rajput congratulated the

mobile operators on renewal of

licenses. He said that AJ&K and

GB have immense importance

in government policies, and

it is the government’s priority

to provide advanced telecom

services in these regions.

He said that there are vast

opportunities for public-private

collaboration in various sectors

including telecoms.

It is pertinent to mention that

due to license renewals,

this will not only contribute towards

uninterrupted provision of better

telecom services to the people of AJ&K

and GB but will also help in promotion

of competition and investment in the

telecom sector.

we endeavor to further strengthen

educational institutions across Pakistan

such as GCU that play a pivotal role in

grooming of the students for nationbuilding.”

On the occasion, Prof. Dr. Asghar Zaidi

(T.I), Vice Chancellor, Government

College University, Lahore, said “We

are delighted at this partnership with

PTCL that will enable our education

system to efficiently serve all

stakeholders with access to quality

ICT services. With advancement in

technology, better connectivity has

most certainly become a prerequisite

for academic excellence. Tapping

into PTCL’s vast infrastructure and

expertise, it will certainly support our

increasing demand for internet and

telecom services that would most

certainly benefit our students and

teachers in a multifaceted way.”

PTCL has always been at the forefront

to provide latest and innovative

solutions to cater to the ever-growing

demand for best-in-class internet

services in Pakistan.

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TRADE CHRONICLE

Jazz collaborates with USF to provide 4G services

in Jacobabad, Shikarpur & Kashmore

Jazz, Pakistan’s number one 4G

operator and the largest internet and

broadband service provider, has

collaborated with the Universal Service

Fund (USF) to provide 4G services in

Jacobabad, Shikarpur & Kashmore

districts of Sindh. The contract was

signed by Haaris Mahmood Chaudhary,

CEO – USF and Aamir Ibrahim, CEO

– Jazz. Syed Amin Ul Haque, Federal

Minister for Information Technology

and Telecommunication; Asad

Umar, Federal Minister for Planning,

Development, Reforms and Special

Initiatives; and Mian Muhammad

Somroo, Federal Minister for

Privatization graced the occasion

with their presence.

Aamir Ibrahim, CEO – Jazz, said,

“Jazz invested US$ 462 million

during the last two years mainly

to expand its 4G footprint in rural

and semi-urban areas and bridge

the digital divide as we collaborate

with the Government of Pakistan in

realizing the #DigitalPakistan vision.

Today, close to 60% of Pakistan’s

Zong offers amazing postpaid

roaming package for Singapore

After introducing unbeatable

international roaming offers for many

countries in the past, Pakistan’s

connectivity leader, Zong 4G, has now

come up with an amazing roaming

offer for Singapore. The offer will help

Pakistanis travelling to Singapore

for business or leisure keep in touch

seamlessly with their family and friends

back at home.

Strengthening its position as a key

communications solutions provider

for corporate and government

organizations, Zong 4G

has now joined hands

with Gul Ahmed Textile

Mills Pvt. Ltd., one of

Pakistan’s largest textile

mills, to become its

connectivity partner.

The partnership

between the companies

was formalized, after

population has access to Jazz’s 4G

network. Through this contract, Jazz in

collaboration with USF will equip over

a million unserved residents of the

three districts with high-speed mobile

broadband, creating socioeconomic

opportunities and uplifting lives.”

Addressing the ceremony, Syed Amin

Ul Haque said that the Ministry of IT

and Telecommunication has launched

nine projects worth over PKR 8.48

Billion in the last two years focusing

on improvement of network coverage

and provision of high-speed mobile

“The Singapore

Postpaid Roaming

Offer is in continuation

of our IR offers that

are designed to deliver the

best connectivity solution to

Pakistanis travelling abroad.

Helping them always stay

connected with their loved

ones in Pakistan, as they travel

internationally, is Zong 4G’s

top priority. We will continue

enhancing our roaming portfolio

through more innovative products and

Zong 4G joins hands with Gul Ahmed Textile

Mills as connectivity partner

the signing

of contract

between

the senior

management of Zong 4G and Zain

Bashir, Vice Chairman of Gul Ahmed

broadband services along with a

number of optical fiber cable projects

in Sindh. The completion of these

projects will provide facilities to 17.7

Million people in 19 districts of the

province. Currently, 1,900 km of optical

fiber cable is being laid which will serve

educational institutions, health centers

and businesses, allowing citizens to

access high-speed internet. While

addressing the ceremony, Asad Umar

and Muhammad Mian Soomro thanked

Syed Amin Ul Haque for launching

projects worth billions of rupees for the

province of Sindh.

Haaris Mahmood Chaudhary, CEO

– USF said, “Federal Minister of IT

and Telecommunication, Syed

Amin Ul Haque has given special

instructions to spread the benefits

of Information and Communication

Technologies (ICTs) to all corners

of Pakistan regardless of province,

region, language or political

affiliation. This project will benefit an

unserved population of 1.09 Million

in 271 unserved mauzas, there by

covering an unserved area of 3,996

sq. km. of the three districts. The

project will be completed within 12

months.”

services for our customers,” shared

Zong’s official spokesperson.

Textiles Mills in the presence of other

senior representatives.

Through the partnership, Gul Ahmed

Textile Mills will get access to Zong

4G’s state-of-the-art business

solutions, enabling

them to digitalize their

operations and deliver

a seamless connectivity

experience.

These products and

services from Zong are

designed to cater to the

ever-evolving needs of

corporate customers.

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TRADE CHRONICLE

Jazz has secured a PKR 50 billion

syndicated credit facility from a banking

consortium led by HBL. This 10-year

facility will be used to finance the

company’s ongoing 4G network rollouts

and technology upgradation.

This is the first of its kind facility

extended to the telecom sector in

terms of the amount and tenor. The

facility is fully subscribed by HBL, the

consortium’s investment agent and

mandated lead arranger. Other banks

who are also acting as the mandated

lead arrangers and advisors on this

deal include: United Bank Limited,

National Bank of Pakistan, MCB Bank,

Bank Alfalah, Allied Bank Limited,

Askari Bank Limited, Bank of Punjab,

Meezan Bank Limited and Faysal Bank

Limited

As the country’s leading digital services

provider, Jazz has over 69 million

subscribers

and more

than 28

million 4G

users nationwide. Over a period of two

years, the company has invested USD

462 million on 4G infrastructure. The

Pakistan Credit Rating Agency Limited

(PACRA) has also recently upgraded

Jazz secures telecom sector’s largest credit

facility to support 4G network rollout

Jazz’s long-term rating to ‘AA’ with a

stable outlook, depicting the company’s

strong financial depth in the industry.

“We continue to drive the digital

Pakistan agenda by improving digital

infrastructure, bridging the digital divide

and focusing on financial inclusion.

We are enabling societies by investing

State Bank of Pakistan and JazzCash join hands

to increase financial literacy among youth

National Institute of Banking and

Finance (NIBAF) – a subsidiary of the

State Bank of Pakistan (SBP), and

JazzCash, Pakistan’s leading FinTech

Company, have signed a Memorandum

of Understanding for increasing

financial literacy amongst youth of

Pakistan. The two parties aim to jointly

promote financial literacy through the

engaging and interactive game called

“PomPak – Learn to Earn” developed

under SBP’s project, National Financial

Literacy Program for Youth (NFLP-Y).

PomPak, utilizes a story-based

narrative by following the journey

of two families setting up a small

entrepreneurial venture. This helps to

keep the

players

engaged

w h i l e

effectively inculcating ethical behavior

and financial skills such as budgeting,

saving, and banking. PomPak is

available in both English and Urdu

for three age groups: children (9-12);

adolescents (13-17); and youth (18-

29). Anyone who completes the course

is awarded a certificate of financial

literacy jointly from NIBAF and NFLP-Y.

It can be played on a desktop computer

or can be downloaded from Google

Play and the App Store for other

devices.

JazzCash, under its partnership, is

going to provide SBP access to more

than 26 million Pakistanis by promoting

K-Electric and Easypaisa collaborate to offer

convenient digital bill payment options

K-Electric (KE), Karachi’s electricity

provider and Easypaisa, Pakistan’s

leading provider of digital financial

services have partnered together to

extend a convenient and hassle-free

bill payment solution for the power

utility’s customers.

The partnership with Easypaisa offers

5% cashback (up to PKR 100) to new

Easypaisa customers on their first

KE bill

payment.

Through

this partnership, KE is encouraging

customers to use digital modes of

payments from the comfort of their

homes.

Furthermore, Easypaisa’s extensive

agent network of 170,000 +

registered agents spread across the

country will also facilitate customers,

especially those residing in the

in entrepreneurship, digital skills and

literacy. This facility is an integral step

towards ensuring that people are not

bound by the limitations of geography,

gender, or socioeconomic background,

in harnessing the power of the internet.

A transaction of this size is a testament

to the trust the financial community has

on Jazz’s strong financial profile and

its leadership position in the telecom

industry,” said Gabor Kocsis, Chief

Financial Officer, Jazz.

Muhammad Aurangzeb, President

& CEO - HBL commenting on the

occasion stated, “We are delighted

to have led this landmark transaction

in the Telecom sector. HBL has a

long-standing relationship with Jazz

spanning more than two decades.

For the Bank, such transactions serve

HBL’s strategic priority of supporting

the promotion of digitalization across

the country, while underscoring HBL’s

commitment to stand by the robust

and progressive telecom sector of

Pakistan.”

the PomPak application on its platform.

This will help the application reach

a wider audience, thus increasing

its usage and eventually promoting

financial literacy of the nation resulting

in a highly positive socio-economic

impact.

To know more about PomPak, please

visit: www.nflpy.pk/PomPak

outskirts of the city where access to

conventional banking facilities is limited.

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TRADE CHRONICLE

Wateen Telecom partners with Huawei to

upgrade its nationwide Data Transmission

Network to 10 TB capacity

Wateen Telecom, a leading ICT company

with a fiber infrastructure across 250

cities in Pakistan, has signed an

PSX signs NBP as market maker

for govt listed securities

National Bank of Pakistan (NBP) and

Pakistan Stock Exchange (PSX) have

signed an agreement to onboard NBP

as a ‘market maker’ for government

securities listed on PSX.

The signing ceremony was held at the

PSX trading hall in the presence of NBP

President Arif Usmani, PSX MD and

CEO Farrukh H Khan, NBP Treasury

and Capital Markets Group Chief

Muhammad Ismail Usuf, and senior

management of both organisations.

Proceedings started with the gong to

mark the beginning of the trading day.

PSX MD welcomed NBP as Market

Maker for debt securities on PSX.

“The development and growth of debt

capital market is an important strategic

objective of Pakistan Stock Exchange.

It is also a key aspect of the capital

market development plan as a large

and liquid debt capital market is critical

for the economic development of

Pakistan.”

It was for this reason that the SECP

and PSX recently introduced regulatory

agreement with

Huawei Pakistan

to modernize

its countrywide

data transmission

network. Wateen will be deploying a

state-of-the-art Optical Transmission

Network from Huawei to revolutionize

digital landscape

of the country. The

agreement was

signed in Lahore at

the Wateen Telecom

head office by Adil

Rashid, CEO Wateen

Telecom and Mark

Meng, CEO Huawei

Pakistan.

changes allowing banks to

become market makers.

He said that the inclusion of

NBP, one of the largest top-tier banks

in Pakistan, as market maker of debt

securities on PSX was a momentous

occasion for the on-going collaboration

between banks and the capital markets

to develop, deepen, and expand

Pakistan’s debt capital market.

NBP President and CEO Arif Usmani

said, “The market maker status is a

landmark moment for NBP and we are

grateful to PSX for this opportunity. It is

a pleasure to visit the Pakistan Stock

Exchange

for the gong

ceremony

w h i c h

signifies the

commitment

of NBP and

PSX to work

together for

deepening

of debt and

capital markets

in Pakistan

and improving financial intermediation.”

He said that NBP was committed

to playing a role in diversifying the

investor-base of debt securities by

tapping digital distribution channels to

promote investment and develop the

debt securities market in Pakistan.

The market maker initiative would

allow a much wider group of investors

to participate in the government debt

market. It would facilitate capital market

development by mobilising domestic

resources and channelling them

effectively.

Mobilink Microfinance

Bank, CARE International

in Pakistan sign MoU to

strengthen entrepreneurial

and financial ecosystem

Pakistan’s largest digital bank, Mobilink

Microfinance Bank (MMBL) has joined

forces with leading global humanitarian

and development non-governmental

organization, CARE International

in Pakistan (CIP), through a recent

Memorandum of Understanding (MoU),

to foster financial inclusion for small

and medium businesses, especially

those led by women to support their

sustainable development.

President and CEO MMBL, Ghazanfar

Azzam, and Adil Sheraz, Country

Director, CIP signed the MoU in

Islamabad, in presence of senior

officials from both organizations. The

partnership will facilitate financial

inclusion, and business development

skills and linkages for Pakistani

entrepreneurs especially women,

to positively strengthen Pakistan’s

economy, in line with the Government

of Pakistan’s national development

objectives and the National Financial

Inclusion Strategy (NFIS).

Mobile phones worth

$1.684bn imported: PBS

Pakistan

imported

m o b i l e

phones

worth $1.684

billion during

July-April (2020-21) compared to

$1.027 billion during July-April (2019-

20), showing growth of 63.98 percent,

according to the Pakistan Bureau of

Statistics (PBS) data.

The overall telecom imports into the

country during the period under review

increased by 43.76 percent by going

up from $1.337 billion in 2019-20 to

$1.923 billion during the current fiscal

year.

TRADE CHRONICLE - May - Jun - 2021 - Page # 36


TRADE CHRONICLE

Steel & Allied Industry

Steel industry in Pakistan

registered no growth in

1H-FY21

The State Bank of Pakistan while

taking the stock of performance of steel

industry in the first half of the ongoing

fiscal year has pointed out that the

steel sector was unable to register a

growth in H1-FY21, but its contraction

narrowed significantly as the year

progressed. Meanwhile, analysis of the

sector on a quarterly basis reveals that

the output of the sector grew by 6.0

percent in Q2-FY21 against a decline

of 6.8 percent in the same period last

year. However, this rebound in Q2-

FY21 was not enough to offset the

decline in the preceding quarter, which

resulted in a slight overall contraction

during the first half of the fiscal year.

Demand for billets, primarily used in the

construction industry, remained strong.

This led to a 39.1 percent expansion in

the output during H1-FY21 compared

to a contraction of 25.9 percent in same

period last year. On the other hand,

the demand for flat steel products

remained subdued owing to a drop

in the production of appliances in the

country. However, robust demand from

the automobile sector compensated for

some of the losses from the appliances

segment. The increase in demand

from the vehicle industry aided in

narrowing the contraction in the flat

steel production from 30.1 percent in

the preceding quarter to 22.4 percent

in Q2-FY21

ASTL: 3QFY21 Corporate

Briefing Session

The ASTL - Amreli Steels sold a total of

272,198 Tons of rebars during 9MFY21

(↑19% YoY). Wherein, the prime and

subprime rebars sold were 262,381 and

9,817 Tons, respectively. On the other

hand, the sales dispatch in 3QFY21

amounted to 89,290 tons (↓10% QoQ).

As a result, the company’s top line

clocked in at PKR 27.2Bn and 9.8Bn in

9MFY21/3QFY21, up 27/26% YoY.

ASTL managed to sell at an average

price of PKR 109,480/ton in 3QFY21

(↑14% QoQ), compared to average

price of PKR 95,960/ton in 2QFY21.

Government policies are

disabling steel sector

All major steel industry associations

have joined hands to warn the

government of disastrous policy

measures that will hurt the economy

and national interests in a big way. The

most pressing issue is to reverse the

decision of moving the steel industry

from FED to GST regime as it will give

a free hand to over 40 units located in

FATA to illegally sell tax exempt goods

in major markets across the country.

This will directly hit the tax paying and

quality compliant sector of the industry,

causing de-industrialization, closure

of mills, price distortions and most

importantly, an estimated revenue loss

of PKR 50 billion for the government.

Due to weak administrative controls,

many rent seekers have moved their

steel manufacturing facilities to the

FATA areas, taken advantage of the

tax incentives

and abused the

law by selling

tax-free goods

in settled areas

that undercuts

the tax paying

industry. Over

the past few

years, the steel

capacity in FATA

has risen to

approximately 1 million tons per annum

and represents about 16 percent of

the long steel output of the country.

Continuation of this practice will lead to

closure of many steel units, particularly

in Punjab, over the next year.

The government has also rejected

another proposal of the steel industry to

reduce turnover tax on its downstream

retailers to 0.25%. Currently, most

steel retailers are forced to work in an

undocumented environment due to the

huge incidence of turnover tax. There

is no reason for the retailers to join

the tax net as the turnover tax wipes

out their very small profit margins

on selling the steel commodity. By

rejecting the proposal, the government

does not want to create documentation

in the steel supply chain, improve

ease of doing business and facilitate

stakeholders towards compliance.

Furthermore, PSMA has also lodged

its complaints to the Ministry of

Commerce for not rationalizing the

industry’s tariffs as agreed upon. The

National Tariff Policy aims to reduce

import tariffs on imported raw material

that is not manufactured in Pakistan

and abstain from revenue-centric tariff

measures. However, the government

has not been able to walk the talk on

its own National Tariff Policy and has

kept tariffs on primary raw material

for revenue reasons, which makes

the domestic industry uncompetitive.

Currently, the industry’s raw material is

taxed at 7% - 10% on import.

In the backdrop, the industry is

struggling to keep pace with volatile

and changing raw material prices

and costs. Steel scrap, industry’s raw

material, has risen from USD 300 at

the beginning of the fiscal year to USD

535 currently, translating into a PKR

cost increase of 37,000. Further, duties

and taxes on

raw materials

account for

another PKR

5,500 per ton.

Electricity has

increased by

37% this fiscal

year, climbing

from PKR 13.5

to PKR 18.5 and

causing a cost

escalation of over PKR 4,000. As such,

cumulative cost increases are above

PKR 40,000 per ton, which is partly

absorbed by the industry and balance

has to be passed on by increasing

prices. Industry experts believe prices

must rise again as recent electricity and

raw material cost increases have not

been passed on and manufacturers are

working on razor thin margins.

Pakistan Association of Large Steel

Producers (PALSP) appeals to the

government to pay attention to the

proposals submitted in order to avert a

major crisis within the industry that will

jeopardize various national objectives

such as PM’s Naya Pakistan Housing

Scheme, PSDP Projects, CPEC

Projects and various other commercial

and residential projects that are the

cornerstone of a growing economy.

TRADE CHRONICLE - May - Jun - 2021 - Page # 37


TRADE CHRONICLE

Travel World

PIA to complete its business

plan in 3 months: CEO

Pakistan International Airline (PIA) is

going to complete its business plan in

three months. This was stated by CEO

PIA Air Marshal Arshad Malik during a

live session held on the airline’s official

Facebook page to answer queries of

customers and general public recently.

He said that the airline’s business plan

was being formulated by IATA on the

instructions of the government and it

would be completed in three months,

adding that PIA was going to induct

narrow body aircraft in its fleet and was

in the process to return the aircraft ATR

72 aircraft which were acquired many

years ago on expensive lease.

Answering queries about in-flight

entertainment, he said that PIA would

gradually replace its aircraft with

newer versions equipped with in-flight

World’s largest cargo plane

lands at JIAP

The world’s largest cargo plane

Antonov An-225 Mriya recently landed

at Jinnah International Airport (JIAP),

Karachi.

According to details, the flight ADB-

3859 arrived at the Karachi airport

at around 11:27am from Kabul. The

similar six engine cargo aircraft had first

landed at the JIAP on April 20, 2018.

The only outsized cargo jet, having a

wingspan of 88.4 meters, a height of

18.2 meters, and a take-off weight of

AirSial launches Islamabad

to Quetta service

Deputy Speaker National Assembly

Qasim Khan Suri has inaugurated

AirSial Airline services from Islamabad

to Quetta here at Islamabad Airport.

Speaking on the occasion, he remarked

that initiation of private domestic airline

service from Islamabad to Quetta would

connect Balochistan to other parts

of the country, said a press release.

He also stated that easy access to

Gwadar Port and China Pakistan

entertainment system.

He said that the UK

government still followed the

EU rules as were imposed

before Brexit, regular

correspondence with UK

authority was being held for

review; adding that PIA had

been certified by EASA and

safety certification was valid till

2023, however, the restrictions

were now based on audit of

airlines’ regulator that was

CAA- Pakistan but not PIA.

“PIA is making HR restructuring

and rationalization and now regular

promotions of all departments are

being conducted purely on merit.

He said that the flying academy had

been closed as PIA presently did not

have the financial support, equipment

and aircraft for the flying academy.

Moreover, he said that PIA was the

1,410,958 pounds,

was designed and

built in the 1980s

in the then Soviet

Union.

The largest aircraft

having registration

UR-82060 operated

several relief

flights, transporting

pandemic-related

humanitarian and

medical goods before

its 10 months break in

August 2020.

Economic Corridor (CPEC) related

projects would

capitalize the

opportunities

of growth and

investment in

province. He said

that the successful

operation of

domestic AirSial

Airline Services

for Six cities

especially for

Quetta would

bring ease and

comfortable

Mr. Arshad Malik

only airline operating in Pakistan

which operates on social economic

routes which other domestic airlines

do not operate and the airline was

still operating flights to domestic

destinations for national cause despite

being commercially unviable just to

provide easy access and connections

from such cities to rest of Pakistan and

the world.

traveling to people of Balochistan.

TRADE CHRONICLE - May - Jun - 2021 - Page # 38


TRADE CHRONICLE

Banking & Insurance

NBP declares Rs7.7bn PAT;

87pc up YoY

For the quarter ended March 31, 2021,

the National Bank declared a profit

before tax of Rs 12.6 bn; whereas profit

after tax closed at Rs 7.7 bn, 87 percent

up, YoY. The Bank’s earnings per share

increased from Rs 1.94 in Q1 ’20 to

Rs 3.62 in Q1 ’21. Net profit translates

into after-tax Return on Average Assets

and Return on Average Equity at 1.0

percent and 15.7 percent, up from 0.5

percent and 10.0 percent in Q1 ’20,

respectively.

Given the significant drop in

the policy rate as compared

to the same period last year,

gross mark-up/interest income

was Rs 48.5 bn being 33.2

percent lower, YoY. Likewise,

the interest/mark-up expense

also dropped by 52.0 percent

at Rs 26.9 bn. Consequently,

net interest/mark-up income of

the Bank stood at Rs 21.6 bn,

i.e. 30.3 percent higher, YoY.

Despite the subdued economic

activity during the year, nonmark-up/non-interest

earning

HBL invests Rs176 million

in Finja

Habib Bank Limited (HBL) has invested

Rs176 million ($1.15 million) in the

last tranche of Finja’s Rs1.56 billion

($10.15 million) Series A1 round, a

statement said. HBL becomes the first

bank in Pakistan to invest in a digital

fintech startup, it added.

Habib Bank joins an

impressive list of leading

global fintech funds that have

invested in Finja, including

BeeNext, Vostok Emerging

Finance, Quona Capital, and

ICU Ventures.

All investors from previous

rounds topped up their

investment in Finja’s

Series A1 round. For HBL,

an investment in Finja

serves two of the bank’s

strategic priorities, making

investments into digital

of the Bank closed 2.4 percent higher

at Rs 8.5 bn (Mar ‘20: Rs 8.3 bn).

Accordingly, total revenue of the Bank

was 21.0 percent up YoY at Rs 30.1 bn

(Mar ‘20: Rs 24.9 bn).

Administrative expenses remained

controlled and recorded a marginal

increase of 3.8 percent YoY to close

at Rs 14.3 bn. Cost-to-income ratio

of the Bank improved to 47.7 percent

from 55.5 percent in Q1 ’20. During

the year, NPLs of the Bank increased

by 6.6 percent to close at Rs 182.5

bn (Dec’20: Rs 171.3 bn). Proactively

financial inclusion and development

finance companies, especially ones

making an impact in agriculture and

SMEs, as these are the backbone of the

economy, and proactively reinventing

HBL to become a “technology company

with a banking licence”, it said.

Since the beginning of the Covid-19

pandemic in April last year, Finja has

scaled its digital lending portfolio by 550

percent, disbursing over 50,000 digital

moving from ‘incurred’ to ‘expected’

credit loss model, the Bank created

provision charge of Rs 3.11 bn to make

its balance sheet more resilient in the

prevailing circumstances.

On the balance sheet side, the Bank’s

capital discipline has improved its

Common Equity Tier 1 capital ratio to

16.50 percent (Dec’20:14.99 percent)

and Total Capital Adequacy Ratio to

21.91 percent (Dec’20:19.78 percent).

This capital position enables the Bank

to absorb shocks in the foreseeable

future and leverage emerging

opportunities to create value

for its shareholders.

The Bank’s liquidity and

net stable funding ratios

improved to 156 percent and

256 percent, respectively. Net

Assets at end March ’21 stood

at Rs 269.8 bn, translating into

break-up value per share at

Rs 126.8, which is 30 percent

up from Rs 97.2 at end 2018.

The Bank’s end of year total

assets closed at Rs 3,340.3 bn

i.e. 11.0 percent higher than

Rs 3,008.5 bn level of the year

end 2020.

loans to Micro, Small, and Medium

Enterprises (MSMEs).

Despite being the backbone of the

economy, small businesses in Pakistan

have traditionally not been able to

obtain credit to grow, the statement

said.

“We are elated to have HBL

participate in this funding round. Our

groundbreaking success in digitally

scoring undocumented small

businesses has resulted in a

64 percent month-on-month

portfolio growth for us since

the outbreak of the pandemic

earlier this year,” said Finja

CEO and Co-Founder Qasif

Shahid.

“Undoubtedly, HBL’s financial

clout, massive network, and

progressive leadership will

help us elevate the country’s

most important segment, the

SMEs.”

TRADE CHRONICLE - May - Jun - 2021 - Page # 39


TRADE CHRONICLE

Pakistan Kuwait Investment Company

(Private) Limited (PKIC) announces

that it is making an equity investment

of PKR 500 million in Planet N

(Private) Limited. This is the largest

equity investment by a local Financial

Institution in a Tech Investment

Platform in Pakistan. It was approved

by the Board of PKIC in December,

2020. This investment will not only

help Planet N expand its operations,

but it will also motivate

other investors to

explore opportunities

to develop and

strengthen tech

entrepreneurship

and disruption in the

country.

With total assets of

over PKR 107 billion

and equity of over

PKR 38 billion, PKIC is Pakistan’s

leading DFI engaged in investment and

development financing activities in the

country. PKIC was established as a

joint venture between the Governments

of Pakistan and Kuwait in 1979. It

is a “AAA” (Triple A) rated financial

institution.

Planet N has invested and nurtured tech

start-ups such as Tapmad TV, Dawaai.

pk, PublishEx, Tez Financial Services,

Datalift, PiePie, Kashat, JinglePay,

etc. spread across various jurisdictions

including

Pakistan,

U A E ,

Egypt,

Singapore and USA. It currently has

more than 30 companies in its portfolio

focusing on financial inclusion, fintech,

digital media, data science & AI. This

portfolio is expected to grow further

after the equity investment by PKIC.

Pakistan Kuwait Investment Company to make

PKR 500 million equity investment in Planet N!

Pak-Qatar Takaful Group gets ISO

27001 certification

Pak-Qatar Takaful, Pakistan’s Pioneer

and Largest Takaful Group has been

declared ISO/IEC 27001:2013 certified

from Risk Associates for its Information

Security Management System (ISMS)

after its performance met the standard

required for the certification

The event was attended by Muhammad

Nasir Ali Syed (CEO, Pak-Qatar

Speaking on the occasion of the signing

ceremony, MD PKIC Mr. Mubashar

Maqbool expressed his elation at this

investment by PKIC and stated that

PKIC has a firm desire to support

all priority sectors of the economy,

especially the growing technology

sector, by providing traditional as well

as innovative financing solutions to its

prospective customers. Mr. Maqbool

hoped that this landmark investment

should inspire other players, investors,

family business houses, and

investment companies to do the same

and would also encourage the young

entrepreneurs in the tech sector.

General Takaful), Mr. Azeem

I. Pirani (CEO, Pak-Qatar

Family Takaful), Mr. Kashif

Hassan (Director, Professional

Services – Risk Associates), Mr.

Noman Jehangir (Director, Certification

Services – Risk Associates) along with

senior officials from both organizations.

Speaking at the occasion Mr. Nasir Ali

Syed said, “It is indeed an honor for us

to be awarded with this certification.

Now, more than ever, information

security is critical in maintaining

CEO Planet N Mr. Nadeem Hussain said

he has always tried to encourage local

investors to aid young entrepreneurs

with innovative ideas. His initial

investment in tech companies has

seen exponential gains and he hopes

that having PKIC as an equity partner

will initiate a big disruption in the localinvestors-

horizon and their approach

towards tech-based investments.

Mr. Irfan Siddiqui, CEO and President

Meezan Bank Ltd, chief guest to the

occasion said that this is one of its

kind investment by a

local DFI into a Tech

disruption investment

company paving

the way for further

investment by other

financial institutions

that will help tech

start-ups in Pakistan.

Also, present on the

occasion were Mr.

Ariful Islam, Deputy

CEO Meezan Bank Ltd, Mr. Khurram

Hussain, MD Pak Libya Holding Co.

and senior management from PKIC,

Planet N, and Arif Habib Limited (AHL).

AHL acted as the Financial Advisor to

this landmark transaction.

Planet N was founded by Mr. Nadeem

Hussain in 2016; with a vision to invest

in growth oriented hi-tech companies.

Mr. Hussain is the founder and ex-

CEO of Telenor (previously Tameer)

Microfinance Bank.

continuity between IT and Business

departments. By achieving our ISO

27001 certification, Pak-Qatar Takaful

extends our commitment to our internal,

as well as, external customers, for

whom security is a top priority.”

Mr. Kashif stated, “Certification

and strict compliance with latest

security standards demonstrates the

commitment of Pak-Qatar Takaful

Group to keep the customers

information and data secure at the

optimum level. Achieving ISO/IEC

27001:2013 certification is a major

milestone for PQTG and is a critical

component of its comprehensive and

transparent leadership effort to protect

the businesses.”

TRADE CHRONICLE - May - Jun - 2021 - Page # 40

Pak-Qatar Takaful remains committed

to provide best in class services to its

participant base.


TRADE CHRONICLE

TRADE CHRONICLE - May - Jun - 2021 - Page #

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