Category: Business

The most important business news, explained in a young, easy to understand way. News that affects young career professionals.

  • PM offers Sri Lanka to join CPEC, says trade links vital to eradicate poverty

    PM offers Sri Lanka to join CPEC, says trade links vital to eradicate poverty

    Prime Minister Imran Khan on Wednesday invited the Sri Lankan businessmen to invest in Pakistan, saying trade connectivity among the countries of the Asian sub-continent was vital for poverty alleviation.

    Addressing the Pakistan-Sri Lanka Trade and Investment Conference held in Colombo which he jointly chaired with his Sri Lanka counterpart Mahinda Rajapaksa, Imran proposed establishing trade links, as existed among the European countries, for the prosperity of the Asian sub-continent.

    The PM also urged the Sri Lankan government to become part of the China-Pakistan Economic Corridor (CPEC), saying joining the Belt and Road Initiative could open up new avenues for Sri Lanka with an opportunity to establish trade links with the Central Asian states via Gwadar.

    The PM, who is in Colombo on a two-day official visit, said political stability in the region by maintaining good relations with neighbouring countries would ensure a business-friendly environment.

    He said Pakistan and Sri Lanka could explore the idea of generating wealth through joint business activities and diverting the wealth to alleviate poverty. Imran offered the Sri Lankan businessmen to explore the immense opportunities offered by the government of Pakistan in the form of ease-of-doing business. He said his government would welcome and facilitate investment from the island nation.

    The PM mentioned that as Pakistan and Sri Lanka both suffered the brunt of terrorism in the past, their journey together towards development could make a difference. He expressed intent for Pakistan to learn from Sri Lanka’s advanced tourism industry and mentioned that he made the tourism minister part of his delegation to explore the area.

    Imran said Pakistan has a lot of undiscovered sites of religious tourism, including the Gandhara civilization. He added that a recently discovered 40-feet-long Sleeping Buddha could be of special interest for Sri Lankan tourists.

    In an effort to maintain good relations with neighbouring states, Imran Khan recalled his offer to Indian Prime Minister Narendra Modi for a dialogue to resolve all outstanding issues including the Kashmir dispute. To encourage trade ties with neighbours, he said, “maintaining amiable relations and living like civilized nations must be a priority”.

    Imran Khan emphasized that with 1.3 billion people, the South Asian region needed to resolve its mutual conflicts through dialogue for sustainable prosperity.

    On Tuesday, Pakistan and Sri Lanka agreed to further strengthen bilateral relations in diverse areas, including trade, investment, science and technology, and culture, as Prime Minister Imran Khan urged the Sri Lankan counterpart to become part of the CPEC.

    “My visit is aimed at strengthening bilateral relationship [with Sri Lanka], especially trade and economic ties through enhanced connectivity…,” Prime Minister Imran Khan said while addressing a joint press conference with his Sri Lankan counterpart Mahinda Rajapaksa after holding one-on-one and delegation-level talks.

  • Pakistan signs $85.6m deal with Ukrainian company to modernise tanks

    Pakistan has awarded a contract worth $85.6 million for modernising T-80UD battle tanks to Ukroboronprom, a state-owned association of major defence conglomerates of Ukraine.

    According to reports, the contract is signed at the International Defense Exhibition (IDEX) 2021, being held in Abu Dhabi.

    Zubaida Jalal, the minister for defence production, and the CEO of Ukroboronprom, Yuri Gusev, signed the contract. After signing the contract, the minister said that bilateral military-technical cooperation between Pakistan and Ukraine will increase in the future.

    The Ukroboronprom CEO said that Ukraine’s companies are constantly updating their production capacity and improving technologies to ensure high-quality work and products.

    T-80UD tanks were first introduced in 1976. They have significant importance in the defensive arsenal of many countries to this day.

    Besides Ukraine, China, Russia, South Korea, Kazakhstan, and Egypt, and Pakistan are a few of the countries which use T-80UD tanks to augment their defence. An estimated 6,000 of these tanks are present worldwide.

    Weighing around 46 tonnes, the T-80UD tank is 9.6 meters long with gun forward, 3.6 meters wide, and 2.2 meters high. At least three crew members can fit into the modernised T-80UD tank which has a ground clearance of 0.44 meters and a top speed of 48km/h.

  • Foreign experts to arrive in Pakistan to revive PIA

    A delegation of foreign experts will arrive in Pakistan on Monday (today) to devise a five-year corporate business plan for cash-strapped Pakistan International Airline (PIA).

    According to reports, the four-member team is arriving in Pakistan on the invitation of Dr Ishat Hussain, advisor to Prime Minister (PM) Imran Khan on institutional reforms. They will stay in the country for 12 days to develop the plan for the national carrier.

    The team will review the business model and also meet government officials at the finance ministry as well as the airline’s chief executive officer (CEO), Air Marshal Arshad Malik.

    They will devise a business plan for the airline to make it profitable and sustainable. “We will be following the government’s directives on restructuring and reforms in the airline,” reports quoted them as saying.

    It is pertinent to note that Dr Hussain is supervising the reforms in PIA. Back in November 2019, the airline had sought the services of a reputed international firm with extensive aviation consulting experience to prepare a five-year corporate business plan through a tender.

    The objective was to revive PIA as a leading international airline, and enable it to play an important role in the country’s struggling economy.

  • ACE unearths mega corruption scam in excise department

    ACE unearths mega corruption scam in excise department

    According to media reports, Punjab Anti-Corruption Establishment (ACE) has unearthed multi-billion scam pertaining to vehicle registration.

    Reportedly, many vehicles were registered through a fake auction in the name of a government department in Punjab.

    In a letter to ACE, the department confirmed that it had never auctioned these vehicles and the vouchers used for auction were fake.

    A group of excise and taxation bureaucrats are responsible for registering these vehicles through fake action vouchers and caused losses of billions of rupees to the provincial economy.

    The report added that the ACE acquired the data of the bank transactions from the beneficiaries of the auctions that show money transfers worth millions of rupees.

    Earlier, in December 2020, a corruption scandal of the same nature was unearthed by ACE. Used, smuggled and stolen vehicles were auctioned on the basis of fake army action vouchers for several years by a gang, comprising officials of Punjab excise and taxation department and private person.

    The anti-graft watchdog started the investigation in 2017. They revealed that as many as 7,013 vehicles were dubious, with 4,000 of them being registered on the basis of fake vouchers. Moreover, they were unable to verify other vehicles in records. This has caused a total loss of Rs 300 billion to the exchequer directly or indirectly.

  • Bitcoin hits new record of $50,000

    Bitcoin hits new record of $50,000

    Cryptocurrency Bitcoin has hit a new record after its value crossed 50,000 dollars on Wednesday.

    The cryptocurrency was created by an unknown investor, and its values has risen about 72% this year.

    Bitcoin and other cryptocurrencies are generated by computers. Part of its supposed value comes from the finite number that can be computed.

    However, regulators and investors have warned about its high volatility. The values of cryptocurrencies can change fast, both upwards and downwards.

    Business magnate Elon Musk, the founder of Tesla and SpaceX, has bought Bitcoin worth $1.5 billion. He has said that he would accept them as payment for its cars.

    There is a strong opinion among cryptocurrency supporters that Bitcoin will replace gold in the future, as amid the COVID-19 pandemic, it was the top performing asset in 2020.

    However, there is an opposite view…

    “If that narrative comes to fruition, then the growth potential is off the charts as $50,000 per bitcoin equates to a market cap of roughly $931bn, which is almost 9% of gold,” said John Wu, president of blockchain company Ava Labs.

    “If BTC meets gold’s market cap, then that would be at least $500,000 per bitcoin.”

    Unlike other commodities, Bitcoin, however, cannot be used for anything else, merely bought and sold. This has made attempts to value it difficult.

    Many supporters are holding on to them in anticipation of higher valuations. Should they all sell at once, the price could tumble.

    People have lost large amounts of money in steep drops in the value of cryptocurrencies, hacks and even scams linked with them.

    British financial watchdog, Financial Conduct Authority (FCA), launched 52 investigations into alleged cryptocurrency frauds.

    There is another problem with cryptocurrency, it can pass international borders swiftly because they are not regulated, in a way cash or regular investments are; which makes investigating thefts hard.

    Last month, the FCA issued a stark warning to investors in so-called crypto-assets.

    The financial watchdog said investors should be “prepared to lose all their money” should their investment’s value collapse

  • Pakistan, IMF agree on reforms for release of $500m

    Pakistan, IMF agree on reforms for release of $500m

    The International Monetary Fund (IMF) and Pakistan on Tuesday reached a staff-level agreement over reforms that will lead to the release of around $500 million in funds, the IMF and the finance ministry said.

    The package strikes an appropriate balance between supporting the economy, ensuring debt sustainability and advancing structural reform, the fund said in a statement.

    “Pending approval of the Executive Board, the reviews’ completion would release around US$500 million,” the IMF said.

    Finance Minister Dr Abdul Hafeez Shaikh also confirmed the agreement on Twitter, saying that “overcoming the challenges created by the pandemic has required concerted effort”.

    “This is a good development for Pakistan,” he added.

    In a statement, IMF said that Pakistan’s progress under the Extended Fund Facility (EFF) had been temporarily disrupted by the shock of the pandemic.

    “The Pakistani authorities remain committed to ambitious policy actions and structural reforms to strengthen economic resilience, advance sustainable growth, and achieve the EFF’s medium-term objectives,” the statement noted.

    Last month, State Bank of Pakistan Governor Dr Reza Baqir had said that Pakistan was in talks with the IMF to put the financial support programme back on track.

    “We hope to have good news for the market and the world that we are putting the programme back on track,” Baqir had said.

    Last year, staff from the IMF and Pakistani authorities reached an agreement to pave the way for a disbursement of $450m in IMF funds pending approval from the global lender’s executive board.

    Pakistan and the IMF have been working to implement IMF-supported economic reforms, in particular tax collection, aimed at stabilising the economy and shoring up a yawning fiscal deficit.

    Pakistan entered a $6 billion IMF programme in 2019.

  • PAMA calls out federal govt for favouring ‘one specific car manufacturer’

    PAMA calls out federal govt for favouring ‘one specific car manufacturer’

    The latest Auto Development Policy (ADP) has paved the way for several new companies to enter the Pakistani auto market. Companies like Regal Motors, KIA, Hyundai, Proton, and Changan entered the market following the ADP.

    During the 34th meeting of the Auto Industry Development Committee (AIDC), the Pakistan Automotive Manufacturer Association (PAMA) expressed concerns that the federal government favours one specific car manufacturer, a fresh entrant in Pakistan.

    A PAMA official said, “There is a new entrant in the market, selling and booking vehicles without establishing a production plant in the country. Under ADP 2016-2021, the new entrants can import only 100 complete built-up (CBU) units at 50% duty for marketing and production purposes. Meanwhile, the companies have to pay complete duty on the 101st vehicle.”

    According to media reports, PAMA members have asked the Engineering Development Board (EDB) in a letter that “when will the benefits for new entrants will end?”

    PAMA further said in the letter: “Under the ADP, the new entrants are allowed a concession period of 3 to 5 years; depending on each unique case, starting from the production date.”

    PAMA finds it problematic that the new entrants are reported, submitting revised business plans; even those who have already started commercial production.

    These revised plans may circumvent the incentive period that could be more than three or five years.

    It is pertinent to note that the statement comes at a time when businessman Javed Afridi, who has brought MG to Pakistan, alleges that “As new entrants bring in exciting new models at far lower prices, instead of competition, we expect maligning campaigns and baseless rumours. While we know that competition is an unfamiliar phenomenon in Pakistan’s automobile industry, we invite everyone to join in a fair competition to serve Pakistani consumers with a bigger and better variety of vehicles at lower prices.”

    What are your thoughts on this? Please share with us in the comment section below.

  • Here is why some banks are charging Rs2.50 at ATM withdrawals

    Here is why some banks are charging Rs2.50 at ATM withdrawals

    Many people have been charged Rs2.50 at Automated Teller Machines (ATM), creating buzz on social media. But what is it all about?

    As per details of the new charges, the State Bank of Pakistan (SBP) has not issued any directives to commercial banks to charge against the service of transaction receipts.

    But one of the largest banks in the country, Habib Bank Limited (HBL), confirmed that the initiative is part of a “GO GREEN” exercise by 1Link to urge customers to avoid unnecessary use of paper and keep the environment clean.

    1Link, which provides ATM services to the banks in Pakistan, came up with a unique justification in their official statement.

    Ther payment switch operator stated that the SMS Service is free and could be used as an alternative. Many banks charge an amount ranging from Rs50 to 75 + tax on a monthly basis. Notwithstanding, the central bank directed them to make SMS services free.

    The fee of Rs2.5 on printing receipts has been implemented by some banks. One after another, banks will likely impose the charges on the customers.

    Some banks might use it as a marketing strategy to their advantage and refrain from this practice.

    What are your views on this? Share with us in the comments below.

  • VIDEO: MG electric cars damaged in Sindh trailer overturn

    At least 13 MG (Morris Garages) electric cars imported from South Korea were damaged when a loaded trailer overturned near Nawabshah.

    According to the media reports, the speeding trailer turned turtle near Dino Machine area of Daulatpur in Nawabshah on National Highway on Friday.

    Motorway Police shared the details of the accident, saying that the trailer was on its way to Lahore from Karachi when it overturned.

    They added that no loss of life was reported due to the accident. In terms of monetary value, each car was worth almost Rs9 million.

    In December, the federal cabinet had approved Pakistan’s first Electric Vehicle (EV) Policy. The EV Policy and the Mobile Manufacturing Policy was endorsed by the Federal Cabinet, following their approval by the Economic Coordination Committee (ECC) on December 16.

    Earlier, Federal Minister for Science and Technology Fawad Chaudhry, while attending the ceremony of an upgraded version of Lahore Chambers of Commerce website, said that the battery-powered electric cars would hit the roads of Pakistan very soon.

    He further added that the government is taking every step to make Pakistan environmental friendly and economically strong.

  • Pakistan’s e-commerce market size increases to Rs96bn

    Pakistan’s e-commerce market size increases to Rs96bn

    Pakistan’s e-commerce marketing size has increased to Rs96 billion in the first quarter of the financial year 2021 as compared to Rs71 billion in the first quarter of the financial year 2020.

    This was informed during the fourth meeting of the National e-Commerce Council (NeCC), chaired by Abdul Razak Dawood, advisor to Prime Minister (PM) on commerce.

    NeCC is a body of representatives from the public and private sector, established under the National e-Commerce Policy approved by the cabinet in October 2019.

    According to officials, the NeCC discussed operationalisation of cross border e-commerce procedures, incentives to promote e-commerce, ways to introduce international payment services.

    Furthermore, deliberations on the mercantile stock exchange, digital on-boarding services, reports of the consultative committee on Women Economic Empowerment (WEE), e-commerce business facilitation portal, consumer protection councils, availability of broadband to remote areas, Trade Development Authority of Pakistan (TDAP) a digital transformation process, and collaboration with Small and Medium Enterprises Development Authority (SMEDA) on e-commerce related matters were also discussed.

    The Federal Board of Revenue (FBR) informed the meeting on the legal framework updates, including e-commerce rules regarding the mechanism of imports goods clearance, and return of goods policy.

    The State Bank of Pakistan (SBP) also gave a detailed presentation on efforts to promote cross-border e-commerce.

    The National Institutional Facilitation Technologies (NIFT) informed the meeting that they are developing a payment solution for cross border/international payments in collaboration with the SBP through which people outside of Pakistan will be able to pay through Paypal, Google Pay and Apple Pay. Payments within Pakistan will be processed through the help.

    NIFT said that the payment system was to become functional by the end of 2020 but the diversion of efforts towards COVID affected the plan badly.

    Meanwhile, the sub-committee on financial inclusion and digitization shared its progress of conducting three webinars for freelancers, mobile wallets, account-based solutions and card-based payments.