KARACHI: The State Bank of Pakistan (SBP) is expected to keep its key interest rate unchanged at 7 percent amid economic recovery, experts say, as the central bank is scheduled to announce its monetary policy for the next two months on Monday.
The SBP slashed its key policy rate from 13.25 percent to 7 percent between March 17 and June 25 to support the economy hit by the coronavirus outbreak.
"The central bank is expected to keep the interest rate unchanged because the COVID situation prevails and we believe that the government will not like to increase rates amid the economic recovery," Samiullah Tariq, head of research at Pakistan Kuwait Investment, told Arab News on Sunday.
According to a poll conducted by Topline Securities, majority of top-notch financial market participants also believe the rate will remain the same.
"Out of 72 responses received, 87.5 percent are of the view that rate will remain unchanged, 7 percent voted for a rate increase of 25 bps and above,” Muhammad Sohail, chief executive of Topline Securities said.
Another brokerage firm, Arif Habib Limited (AHL), also predicts that the monetary stance would not change.
“We expect the SBP to keep policy rates unchanged at 7 percent in the upcoming monetary policy statement," AHL said in a report, forecasting that inflation is likely to ease in coming months.
The central bank forecasts that the average inflation rate would be between 7 percent and 9 percent during the current fiscal year.
Pakistani industrialists, however, are calling for a further reduction of interest to 5 percent, saying it is necessary for the growth momentum and industrialization in the country.
"Our economy was on a ventilator before that coronavirus outbreak and after the situation turned worst the unemployment has substantially increased and now the government is taking long-term measures and it seems that the economic situation is improving," Sheikh Sultan Rehman, vice president of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), told Arab News.
"There are signs of economic recovery and to keep the momentum continue we demand that the interest should be reduced to 5 percent and gradually to around 3 percent for long-term growth," he said.
Economists say that in the current global and domestic situation, monetary policy has to ensure that financing conditions remain favorable.
"An uncertain global recovery is pushing central banks to actively ensure that monetary policy remains geared to financing the whole economy. In addition, lower inflation has given room for near zero rates globally," said Dr. Khaqan Najeeb, former advisor at the Ministry of Finance.
He added that with slowing growth and higher food inflation the task is complex for Pakistan.
The central bank expects that economic growth would be between 1.5 percent and 2.5 percent as compared with the negative growth of 0.4 percent recorded in the previous fiscal year. Pakistan had recorded negative growth for the first time since 1952.
"Monetary policy has to ensure financing conditions remain extremely favorable. Beyond just lower funding costs it is crucial to recalibrate instruments to counteract the negative impact of funding measures for containment of the virus," Dr. Najeeb said.
Pakistan’s central bank likely to keep interest rate unchanged
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Pakistan’s central bank likely to keep interest rate unchanged
- SBP slashed its key policy rate from 13.25 percent to 7 percent between March 17 and June 25 to help the economy hit by COVID-19
- Industrialists are calling for a further reduction to 5 percent to support the growth momentum and industrialization
Three militants killed, one arrested in Pakistan’s restive southwest — military
- The militants were killed in an intelligence-based operation in the Pishin district of Balochistan
- Military says one militant apprehended in injured condition was identified as an Afghan national
ISLAMABAD: Three militants were killed and another was injured in a shootout with security forces in Pakistan’s southwestern Balochistan province, the Pakistani military said on Tuesday.
The shootout took place during an intelligence-based operation in the Pishin district of Balochistan, according to the Inter-Services Public Relations (ISPR), the military’s media wing.
The militants were killed after intense exchange of fire during the conduct of operation.
“One terrorist was apprehended in injured condition, who has been identified as an Afghan national,” the ISPR said in a statement.
“A huge cache of arms, ammunition and explosives was also recovered during the operation.”
Balochistan, which borders Afghanistan, is the site of a long-running insurgency by separatists and religiously motivated militants, who have recently carried out a number of attacks in the region.
Gunmen this month killed nine people, who hailed from the eastern Punjab province, after abducting them from a bus on a highway near the Noshki district. The outlawed Balochistan Liberation Army claimed responsibility for the attack.
Although the government says it has quelled militancy, violence by various groups has persisted in the region.
Last year, Islamabad also set a November deadline for all undocumented migrants, mostly Afghans, to leave or face arrest, forcing more than 500,000 Afghans to flee Pakistan.
Pakistan defended the crackdown by pointing to security concerns and is expected to begin a renewed push to deport more Afghan nationals in the coming weeks, according to officials.
At $306 million, Pakistan reported highest ever single-month IT exports in March — representative
- The Pakistani IT exports surged by $49 million in the last month from $257 million recorded in Feb.
- Representative calls the achievement a result of hard work of all stakeholders and favorable policies
KARACHI: Pakistan recorded highest ever single-month exports in the field of information technology (IT) in March, chairman of the country’s software houses association said on Tuesday.
The Pakistani IT exports surged by $49 million in the last month from $257 million recorded in the month of February, according to Pakistan Software Houses Association (P@SHA).
The exports, which stood at $225 million in March 2023, recorded an increase of 36 percent on a year-on-year basis.
“Crossing $300 million in a single month makes the IT industry second to only textiles in Pakistan,” Zohaib Khan, the P@SHA chairman, said in a statement.
“It is pertinent to note that IT exports for the month of March 2024 is also the highest exports of the industry in a single month in the country’s history.”
Khan said this achievement was a result of hard work of all stakeholders and favorable government policies over the past several months.
“All we need is policy continuity coupled with new initiatives vis-a-vis skills development and branding of the IT sector on a global-scale for the country’s soft-image,” he said, urging the country’s finance and revenue authorities to give due consideration and incorporation to their budgetary proposals that had already been submitted at concerned forums.
The P@SHA Chief reiterated the IT industry would fully support the initiatives of the Pakistani IT ministry in achieving the export target of $3.5 billion for the outgoing fiscal year, which ends in June.
“We should aim for $5 billion for the forthcoming fiscal year, i.e. FY25,” he added.
PepsiCo. reports double-digit revenue growth in Pakistan, China and other nations
- The company reported better-than-expected revenue in first quarter on strong demand for snacks, beverages
- PepsiCo. has leaned heavily into price increases over the past two years to combat higher ingredient costs
PepsiCo. reported better-than-expected revenue in the first quarter on strong international demand for its snacks and beverages.
The Purchase, New York-based company said revenue rose 2 percent to $18.3 billion for the January-April period. That was higher than the $18 billion Wall Street forecast, according to analysts polled by FactSet.
Pepsi reaffirmed its financial guidance for 2024, including organic revenue growth of 4 percent. The company has said it expects to return to more normal rates of growth this year after several years of inflation-driven price increases.
That may have disappointed investors who have grown used to stronger growth at PepsiCo. Last year organic revenue grew 9.5 percent, for example. PepsiCo’s shares fell more than 2.5 percent in morning trading Tuesday.
In North America Frito-Lay revenue rose 2 percent while Pepsi beverage sales were up 1 percent. Sales were hurt by a recall early in the quarter of Quaker Oats cereal, bars and snacks because of potential contamination with salmonella. Quaker Foods sales dropped 24 percent during the quarter.
But the company saw 11 percent sales growth in Asia Pacific and 10 percent sales growth in Europe.
PepsiCo. Chairman and CEO Ramon Laguarta said the company is optimistic that consumer demand will continue to rise this year in the US and elsewhere.
“The consumer, globally, we think is very resilient,” Laguarta said during a conference call with investors. “It’s basically supported by two facts: very low unemployment or quite low unemployment globally and wages growing at a good pace in the majority of the countries where we participate.”
In Europe, sales were driven by demand in Eastern Europe, Laguarta said. In Western Europe, consumers saw fewer PepsiCo. snacks and drinks on grocery shelves during the quarter. Carrefour, one of Europe’s largest supermarket chains, announced in January that it was pulling PepsiCo. products from stores in France, Belgium, Spain and Italy due to unacceptable price increases. The two companies resolved their pricing dispute and Carrefour began restocking PepsiCo. products in early April.
The company said it also saw double-digit organic revenue growth in Mexico, Brazil, Egypt, Pakistan, China and Australia.
But Laguarta added a note of caution. Consumer spending in China remains cautious, he said, and PepsiCo. is also keeping a close eye on lower-income consumers in the US, who are buying fewer snacks or switching to store brands in the face of higher prices.
“The lower-income consumer in the US is stretched,” he said. “That’s a consumer that we are emphasizing in our commercial programs and we are learning how best to keep that consumer in our categories.”
PepsiCo. has leaned heavily into price increases over the past two years to combat higher ingredient costs. The fourth quarter of 2023 was the company’s eighth straight quarter of double-digit percentage price increases.
Those increases moderated in the first quarter. PepsiCo. said net pricing was up 5 percent globally during the quarter, while volumes fell 2 percent. PepsiCo. has said some of that volume decline is strategic. The company has been shrinking package sizes to meet consumer demand for convenience and portion control.
PepsiCo. said its net earnings rose 5.6 percent to $2 billion in the first quarter. Excluding special items, the company earned $1.61 per share. That beat Wall Street’s forecast of $1.52.
Pakistani families urge visiting President Raisi to release cargo crew detained in Iran
- Jalal Ahmed, the cargo boat captain, was on his way from Dubai to Somalia when he was caught by Iran four years ago
- The families of detained Pakistanis say they have not been informed of the charges against Ahmed, others on the boat
KARACHI: Families of Pakistani crew members aboard a cargo boat, which set sail from Dubai to Somalia but was detained by Iran four years ago, appealed to Iranian President Ebrahim Raisi on Tuesday for their release, citing a lack of cooperation from Iranian authorities.
Raisi, who arrived in Pakistan on Monday for a three-day visit, flew to Karachi today after a brief stopover in Lahore. During his stay in Karachi, the Iranian president is slated to meet with government officials and businessmen.
The family of Jalal Ahmed, the captain of the cargo boat, along with others, staged a demonstration in front of the Karachi Press Club to highlight the difficulties they have faced in securing the release of their loved ones, who have been incarcerated in Iran’s Minab city for the past four years.
“We have come here because my brother is imprisoned in the city of Minab in Iran,” Gul Saba, Ahmed’s sister, told Arab News while urging Pakistan’s President Asif Ali Zardari and Prime Minister Shahbaz Sharif to intervene in the matter to secure the release of the detained crew members.
“We also appeal to Iran’s President Ebrahim Raisi to release our brother and the other ten [people] who accompanied him,” she continued.
Saba added her 45-year-old brother, who has three children, was transporting cargo from Dubai to Somalia when his ship was stopped by the Iranian authorities.
She said her family members had traveled to Iran, but there had been no response from Iranian authorities.
“No statement has come [from Iranian officials] regarding why [the Pakistani crew members] have been imprisoned,” she added. “There may be no crime involved as their cargo ship was legal.”
Arab News could not independently verify the claims made by the affected family.
Jawad Jalal, Ahmed’s 10-year-old son, also participated in the protest along with his mother, Sadia Ahmed, and aunt Saba.
“When I was six, my father was imprisoned in Iran,” he said while reminiscing how Ahmed escorted him to school before being detained.
“He should be released so he can drop me off at school once again,” he continued, holding a placard emblazoned with the demand for his father’s release from Iranian prison.
Pakistan says will reconstitute panel on ‘enforced disappearances’ after US report points out rights abuses
- Pakistan has long been plagued by disappearances of political workers, rights activists and professionals
- Families say people picked up by security forces often disappear for years, security agencies deny involvement
ISLAMABAD: Pakistan will be reconstituting a committee to address the longstanding issue of “enforced disappearances,” Law Minister Azam Nazeer Tarar said on Tuesday, hours after the release of a US report highlighting rights abuses in the South Asian country.
Over the years, hundreds of political workers, rights activists and professionals have gone missing in Pakistan, particularly in the northwestern Khyber Pakhtunkhwa and the southwestern Balochistan provinces, where militants have waged a war against the state for decades.
Families say people picked up by security forces often disappear for years, and are sometimes found dead, with no official explanation. Pakistani security agencies deny involvement in such disappearances.
Speaking at a press conference in Islamabad, Tarar noted the former Pakistan Democratic Movement (PDM) government had formed a committee on the issue with the representation of all stakeholders.
“Now the work is being initiated on this again on the directives of the prime minister. A committee is going to be reconstituted, there will be parliamentary presence in that committee,” he said. “There is no lack of seriousness on the government’s part to resolve this issue.”
The minister said they visited the Quetta, the capital of Balochistan province, met with stakeholders there as well as reviewed reports on the matter from the tenure of the caretaker government.
Tarar said 10,200 cases of “missing persons” had been registered in the Commission of Inquiry on Enforced Disappearances (CIoED), out of which around 8,000 cases had been addressed.
He, however, said the issued could not be resolved “overnight,” adding that there had been no “concrete evidence” of the involvement of state agencies in these cases.
The law minister’s comments came hours after a report released by the US State Department said Pakistan’s government “rarely” took steps to identify and punish officials who may have been involved in rights abuses in 2023, pointing out incidents of extrajudicial killings, torture, enforced disappearances, violence against journalists and restrictions on media freedom.
“The government rarely took credible steps to identify and punish officials who may have committed human rights abuses,” the State Department said, pointing out Pakistan last year had seen incidents of restrictions on freedom of expression and media, violence against journalists, unjustified arrests, disappearances of journalists, censorship and criminal defamation laws.
Pakistan’s actions in recent months to restrict Internet and mobile services throughout the country, especially on days when elections are held, have invited criticism from rights organizations and Washington.
The interior ministry last week confirmed it had banned social media platform X in February to protect national security, maintain public order, and preserve the country’s “integrity.”
The South Asian country has seen an uptick in violence, mainly suicide attacks, since November 2022 when a fragile truce between militants and the state broke down.
Pakistan has since then carried out military operations against the Pakistani Taliban or the Tehreek-e-Taliban Pakistan (TTP) and a Baloch separatist militant organization, the Balochistan Liberation Army (BLA) in the country’s two western provinces that border Afghanistan.
