Bloodbath at Pakistan stock exchange, rupee hits another historic low

A stockbroker monitors the share prices during a trading session at the Pakistan Stock Exchange in Karachi, Pakistan, on May 16, 2022. (AFP/File)
Short Url
Updated 16 May 2022
Follow

Bloodbath at Pakistan stock exchange, rupee hits another historic low

  • Pakistan Stock Exchange shed 819 points on Monday, dropping to its lowest since December 2020
  • Experts point to lack of clarity on political front, position on IMF program and the future roadmap

KARACHI: Pakistan’s stock and currency markets witnessed another bloodbath on Monday, traders and economists said, after weeks of indecisiveness of the country’s new administration to implement prior actions demanded by the International Monetary Fund (IMF) and a lack of clarity on the future roadmap.

The benchmark KSE100 index of the Pakistan Stock Exchange (PSX) shed more than 1,000 points in the early trading before closing at 42,667 level, losing 819 points.  This brought the stock market down to its lowest since December 2020. 

However, the trading volume increased from 208.1 million shares to 250.4 million shares, while the average value rose by 27.8 percent to $45.9 million against $35.9 million.

The currency market continued to experience a declining trend as the rupee hit another all-time low against the United States (US) dollar. The greenback closed at Rs194.18 in the interbank market.

Financial experts believe the stock and currency markets suffered the losses due to the government’s inaction on the economic front, including the decision to not withdraw fuel subsidies, a prior action to resume talks with the IMF for the completion of seventh review of the $6 billion program. 

“The stocks were down due to uncertainty surrounding the IMF program as no steps were taken to adjustment oil prices and the investors expected some decisions yesterday,” said Khurram Schehzad, chief executive officer of the Alpha Beta Core financial advisory firm. 

The government “needs to move fast and take the markets and investors into confidence if there is any alternate plan, otherwise the outcomes are scary,” he said.  

Economists say the country’s economy is paying the price for the government’s indecisiveness as investors lack clarity of action. 

“The current crisis is not macroeconomics-driven, rather it stems from the government’s inaction because markets need clarity of action and a future roadmap,” Dr Sajid Amin, deputy executive director at the Sustainable Development Policy Institute (SDPI), told Arab News.   

“The government needs to swiftly declare its economic agenda, including its position on the IMF program and clearly inform about its tenure as to how long it is going to stay.” 

Pakistan and the IMF are currently negotiating the country's seventh review under the $6 billion Extended Fund Facility (EFF), which has so far disbursed $3 billion. Islamabad is expected to receive another $1 billion after the completion of the review. 

The review has been stalled since the previous government announced in February around $1.7 billion relief in energy prices, deviating from the objectives of the IMF program.   

Economists say the success of talks with the IMF would help the Pakistani currency regain some lost ground. 

“The dollar is expected to slide by Rs11-12 immediately once talks with the IMF are positively materialized,” Amin said. 

Pakistan officials and IMF representatives are expected to meet in Doha this week to draw a line of action for the completion of the South Asian country's seventh review. 

Pakistan's Finance Minister Miftah Ismail on Sunday said he was going to hold talks with the IMF, but the government did not raise the petroleum prices under its fortnightly schedule, contrary to expectations. 

“I think Pakistan is expected to talk to the IMF about keeping the fuel subsidies unchanged till June, as announced by the former government of prime minister Imran Khan,” Amin said. 

“Petrol subsidy given in March, April and May equals the BISP (Benazir Income Support Program) for the whole fiscal year 2020-21 and it could have saved Rs27 billion.”  

Analysts say the country has no other options but to avail the IMF program that is needed to stabilize the wobbling economic indicators. 


Pakistan condemns fresh Israeli strikes killing hundreds of Palestinians in Gaza

Updated 18 March 2025
Follow

Pakistan condemns fresh Israeli strikes killing hundreds of Palestinians in Gaza

  • The surprise bombardment threatened to wreck the ceasefire in place since January and fully reignite the 17-month-old war
  • Islamabad urges international community to end violence, resume diplomatic efforts for lasting peace in Gaza and Middle East

ISLAMABAD: Pakistan condemns fresh Israeli strikes on Gaza that have killed hundreds of people and threatened a ceasefire with Hamas, the Pakistani foreign office said on Tuesday, expressing fears about renewed regional instability.
Israel launched airstrikes across the Gaza Strip early Tuesday that killed more than 300 Palestinians, including women and children, according to hospital officials.
The surprise bombardment threatened to wreck the ceasefire in place since January and fully reignite the 17-month-old war, with Israeli officials saying the operation was expected to expand.
Pakistan’s Foreign Office condemned the strikes as a “horrific act of aggression” in the holy month of Ramadan and called it a flagrant violation of the ceasefire agreement.
“This horrific act of aggression, in the holy month of Ramadan, is a flagrant violation of the ceasefire agreement and marks a dangerous escalation that threatens to destabilize the entire region once again,” it said in a statement.
The surprise attack shattered a period of relative calm during the Muslim holy month of Ramadan and raised the prospect of a full return to fighting in a 17-month war that has killed tens of thousands of Palestinians and caused widespread destruction across Gaza. It also raised questions about the fate of the roughly two dozen Israeli hostages held by Hamas who are believed to still be alive.
Prime Minister Benjamin Netanyahu said he ordered the strikes because of a lack of progress in talks to extend the ceasefire. The White House said it had been consulted and voiced support for Israel’s actions.
A senior Hamas official said Netanyahu’s decision to resume the war amounts to a “death sentence” for the remaining hostages. Izzat Al-Risheq accused Netanyahu of launching the strikes to try and save his far-right governing coalition and called on mediators to “reveal facts” on who broke the truce.
“We urge the international community to play it’s role to immediately end the violence and resume diplomatic efforts toward an immediate and lasting peace in Gaza and the Middle East,” the Pakistani foreign office said.
Israel’s war on Gaza began after Hamas’ attack on southern Israel on Oct.7, 2023, which killed 1,200 people and over 200 others were taken into Gaza as hostages. The subsequent Israeli campaign killed around 50,000 Palestinians and displaced almost all of Gaza’s 2 million population, leaving the territory a wasteland.
Both sides agreed to an uneasy, six-week truce on Jan. 19 which paved the way for the release of hostages from both sides.


Pakistan mulls transaction structure for second attempt to privatize loss-making national airline

Updated 18 March 2025
Follow

Pakistan mulls transaction structure for second attempt to privatize loss-making national airline

  • Last year, a deal fell through after a potential buyer reportedly offered $36 million for a 60 percent stake in PIA, a fraction of the asking price
  • Pakistan is looking to privatize the debt-ridden airline to raise funds and reform state-owned enterprises as envisaged under a $7 billion IMF program

ISLAMABAD: Pakistan is mulling transaction structure for a second attempt to sale 51-100 percent share of its loss-making national carrier, the Pakistan International Airlines (PIA), the Privatization Commission said on Tuesday.
Cash-strapped Pakistan is looking to privatize the debt-ridden PIA to raise funds and reform state-owned enterprises as envisaged under a $7 billion International Monetary Fund (IMF) program secured last year.
Late last year, a deal fell through after a potential buyer reportedly offered $36 million for a 60 percent stake in the national flag carrier, a fraction of the asking price of approximately $303 million.
On Tuesday, Muhammad Ali, Pakistan prime minister adviser on privatization, presided over the commission’s board meeting to discuss transaction structure for the divestment of the Pakistan International Airlines Corporation Limited (PIACL).
“The board recommended to CCOP (Competition Commission of Pakistan) the transaction structure proposed for the 2nd attempt of PIACL privatization based on divestment of 51 percent to 100 percent share capital of PIACL together with the management control of PIACL,” the Privatization Commission said.
“The final terms and conditions for the transfer and acquisition of equity stake shall be finalized during course of bidding process and set out in the bid documents for approval by CCOP.”
In June, the government had pre-qualified six groups, but only real-estate development company Blue World City participated in the bidding process to acquire the airline.
Among concerns raised by potential bidders for the PIA stake include policy continuity, honoring contracts, inconsistent government communication, unattractive terms and taxes on the sector, and the flag carrier’s legacy issues and reputation.
Officials say PIA’s cumulative losses alone are close to $3 billion, with the total asset valuation of the airline standing at approximately $572 million.
Earlier this year, PIA resumed operations in Europe, after a 2020 ban by the European Union Aviation Safety Agency (EASA) over concerns about the ability of Pakistani authorities and its Civil Aviation Authority (PCAA) to ensure compliance with international aviation standards.
EASA and UK authorities both suspended permission for PIA to operate in the region after Pakistan began investigating the validity of pilots’ licenses following a deadly plane crash that killed 97 people. Pakistan hopes new European routes and flying approval to the UK will boost PIA’s selling potential.


Pakistan’s top military, political leaders call for national consensus, political unity amid militancy surge

Updated 18 March 2025
Follow

Pakistan’s top military, political leaders call for national consensus, political unity amid militancy surge

  • Country’s top civilian and military leaders assembled at Parliament House on Tuesday to discuss measures to curb militancy
  • Meeting of Parliamentary Committee on National Security called after hijacking of train by separatists in Balochistan province

ISLAMABAD: Pakistan’s Parliamentary Committee on National Security on Tuesday stressed the need for a national consensus to counter militancy, calling for a unified political stance to confront the threat with “full force of the state.”
The statement came after a meeting of Pakistan’s top civilian and military leaders at the Parliament House days after the hijacking of a passenger train by the Baloch Liberation Army (BLA) separatist group in Pakistan’s southwestern Balochistan province, holding hundreds of passengers hostage. The military launched an operation and, after a day-long standoff, rescued 354 captives and killed 33 insurgents. A final count showed 23 soldiers, three railway employees and five passengers had died in the attack.
Militant violence has persisted in the province following the incident, with three paramilitary soldiers among five people killed in a suicide attack in Balochistan’s Nushki district on Sunday. The escalation in attacks prompted National Assembly Speaker Sardar Ayaz Sadiq to convene a session of the parliamentary committee on Tuesday at Prime Minister Shehbaz Sharif’s advice.
Tuesday’s meeting at the Parliament House was attended by Prime Minister Shehbaz Sharif, members of the parliamentary committee, political leaders, Army Chief General Asim Munir, federal ministers and senior intelligence officials. The military leadership and intelligence officials briefed the participants on the security situation, while political leaders expressed their views on how to deal with the prevailing situation. At the end of the meeting, PM Sharif read out a communiqué that was later adopted by the committee unanimously.
“The committee stressed the need for a national consensus on counter-terrorism, emphasizing strategic and a unified political commitment to confront this threat with the full force of the state,” Sharif said.
“It also called for the immediate implementation of the National Action Plan and the Azm-e-Istahkam strategy to dismantle terrorist networks, counter logistical support, and eliminate the nexus between terrorism and crime.”
Sharif said the committee expressed concern over the “increasing misuse of social media platforms” by militant groups for propaganda, recruitment and coordinating attacks.
“It emphasized the need for immediate measures to curb this threat and called for a clear framework to counter terrorists’ digital presence and activities,” he added.
The committee reiterated that no institution, individual or group collaborating with enemy forces would be allowed to jeopardize Pakistan’s peace and stability, according to the premier. It expressed regret over the absence of some opposition members.
An alliance of opposition parties, led by jailed former prime minister Imran Khan’s Pakistan Tehreek-e-Insaf (PTI) party, declined to participate in the meeting, objecting to Khan’s absence from the moot.
Pakistan ranks as the second-most affected country by terrorism, according to The Global Terrorism Index 2025. Militancy-related deaths surged by 45 percent, rising from 748 in 2023 to 1,081 in 2024, marking one of the steepest global increases.
Militant attacks in Pakistan more than doubled, from 517 in 2023 to 1,099 in 2024. Balochistan and Khyber Pakhtunkhwa, bordering Afghanistan, remained the hardest-hit provinces, accounting for over 96 percent of attacks and fatalities.
‘GOVERNANCE GAPS’
Speaking at the forum, Army Chief Gen. Munir said no agenda, no movement and no personality was greater than the security of the country, according to the Inter-Services Public Relations (ISPR), the military’s media wing.
“For sustainable development, all elements of national power will have to work in harmony. This is a battle of our survival and that of our future generations,” he was quoted as saying.
The army chief stressed the need for “better governance” in the country and making Pakistan a “hard state.”
“How long will we continue to sacrifice countless lives in the style of a soft state,” he asked. “How long will we continue to fill the governance gaps with the blood of the armed forces of Pakistan and the martyrs?“
The general urged religious scholars to expose the distorted interpretation of Islam by the religiously motivated militant groups.
“We exist only if the country exists,” he said. “There is nothing more important for us than the security of the country.”
Defense Minister Khawaja Muhammad Asif said Pakistan was planning a “decisive action” against militants.
“Civilian and military leadership are working to unite the entire nation against the terrorist enemy,” he said on X after the meeting. “The ranks have been formed, victory will be Pakistan’s.”
The minister criticized the PTI for its absence from the key security meeting: “No Khan, No Pakistan, is PTI standing by this slogan?”
Khan’s party said the ex-premier should have been invited to the meeting.
“No representative from us will attend the meeting and Khyber Pakhtunkhwa Chief Minister Ali Amin Gandapur would attend the meeting as the KP chief minister, not the party representative,” PTI Secretary General Salman Akram Raja announced at a press conference earlier in the day, saying Khan should have been invited by releasing him on parole.
Sayed Zulfikar Bukhari, a close Khan close aide and spokesperson for the international media, told Arab News the government and military wanted to use the PTI for its “upcoming adventures.”
“The government and army just want to use PTI for their upcoming misadventures in Balochistan and Afghanistan,” he told Arab News, questioning how the largest party in the country could attend the meeting without directions from their leader.
“Give us access to Khan to get directions as he is the only unifying figure in the country.”
Mahmood Khan Achakzai, an opposition leader, said instead of such meetings a joint session of parliament should have been called to discuss this important issue.
“Pakistan’s dire circumstances call for a joint session of parliament, where everyone must be given the opportunity to speak,” he said.


Pakistan shuts universities in southwest province over ‘security concerns’

Updated 18 March 2025
Follow

Pakistan shuts universities in southwest province over ‘security concerns’

  • Security across the provincial capital has been heightened, with an increased number of security forces on the streets
  • The decision to reopen the campuses will be made after the Muslim festival of Eid, just two weeks away, an official says

QUETTA: Pakistan’s volatile Balochistan province has ordered the closure of three universities in recent weeks due to “security concerns,” an official told AFP on Tuesday, as separatist attacks surge in the region.
Two universities in the provincial capital of Quetta were ordered to close for an “indefinite period” last week, while on Tuesday, a third was instructed to switch to virtual learning, a provincial administration official told AFP on condition of anonymity as he was not authorized to speak to the media.
“The decision was made after reviewing the overall security situation,” the official said
“It was decided to switch to virtual learning until further notice due to security concerns.”
The decision to reopen the campuses, which will impact thousands of students, will be made after the Muslim festival of Eid, just two weeks away, the official said.
Security across the provincial capital has been heightened, with an increased number of security forces on the streets and additional checkpoints set up throughout the city following the recent surge in separatist violence.
Last week, ethnic Baloch separatists attacked a train with 450 passengers on board, sparking a two-day siege during which dozens of people were killed.
And on Sunday, at least five paramilitaries were killed in a vehicle-borne suicide attack.
The assaults were claimed by the Baloch Liberation Army (BLA), one of a number of separatist groups that accuse outsiders of plundering natural resources in Balochistan near the borders with Afghanistan and Iran.


Pakistan to resume Jaffar Express train service today after deadly hijacking

Updated 18 March 2025
Follow

Pakistan to resume Jaffar Express train service today after deadly hijacking

  • Separatist militants last week hijacked Jaffer Express and killed 31 people, including security personnel
  • Railways Minister Hanif Abbasi says drone surveillance will be conducted for train operations in Balochistan

ISLAMABAD: Railways Minister Hanif Abbasi has announced the resumption of Jaffar Express train service today, Tuesday, Pakistani state media reported, a week after separatist militants hijacked the passenger train in the southwestern Balochistan province.
Fighters of the Balochistan Liberation Army (BLA) separatist group bombed a section of the railway track and stormed the Peshawar-bound Jaffar Express train carrying over 400 passengers, in Mushkaaf, a rugged area in the mountainous Bolan range of Balochistan on March 11.
The crisis was resolved the following day when the armed forces carried out a successful operation to rescue the hostages, killing 33 militants in the process. A final count showed 23 soldiers, three railway employees and five passengers had died in the attack.
Abbasi said the track, which had been damaged in the recent attack by separatist militants in Balochistan, has now been fully restored, the Radio Pakistan broadcaster reported.
“Jaffar Express will resume its operations from today. Drone surveillance will be launched for train operations in Balochistan,” Abbasi was quoted as saying. 
“CCTV cameras are also being installed at railway stations and other sensitive locations across the country to improve security.”
In oil-and-mineral-rich Balochistan, Pakistan’s largest and least populated province, ethnic Baloch separatists have long accused the central government of denying locals of a share in the province’s resources. Islamabad and Pakistan’s military strongly reject the allegations.
The military has a huge presence in Balochistan and has long run intelligence-based operations against insurgent groups such as the BLA, who have escalated attacks in recent months on the military and nationals from longtime ally China, which is building key projects in the region, including a port at Gwadar.
More than 50 people, including security forces, were killed in August last year in a string of assaults in Balochistan claimed by the BLA.