Pakistan seeks deferred payments for over $220 million in Azerbaijan oil, LNG — official

Oil tankers park in a terminal amid a countrywide strike by the All Pakistan Oil Tankers Association near a port in the Pakistani city of Karachi on July 26, 2017. (AFP/FILE)
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Updated 23 February 2023

Pakistan seeks deferred payments for over $220 million in Azerbaijan oil, LNG — official

  • Pakistan moves summary for the import of oil, LNG from Azerbaijan to the ECC for approval, says official 
  • Pakistani experts say import of energy products on credit will give breathing space under tough economic conditions 

KARACHI: Cash-strapped Pakistan’s Petroleum Division has moved a summary to the Economic Coordination Committee (ECC)--the country’s top economic decision-making body— to import energy products worth $220 million from Azerbaijan, an official confirmed on Thursday. 

Pakistan has been striving to clinch favorable energy deals from various countries in an attempt to cut down its whopping import bill of gas and petroleum products which surpassed $23 billion during the last financial year.

With alarmingly low foreign reserves, the country is out of the LNG spot market since June 2022, firstly due to skyrocketing prices of energy products and secondly, due to its fast-depleting forex reserves. 

Islamabad and Baku this week held talks to materialize two credit lines worth around $220 million to import petroleum products and LNG under government-to-government (G2G) arrangements, the official added. 

“The [Pakistani] delegation has arrived back and we have moved a summery to the ECC for the approval for imports from Azerbaijan. After approval, it would be operationalized,” a Petroleum Division official privy to the development told Arab News on condition of anonymity. 

The official said Pakistan has requested Azerbaijan for the credit lines facility and is awaiting response while the ECC’s approval is expected within this month. 

The State Oil Company of the Azerbaijan Republic (SOCAR) will arrange for the credit lines it offered to Pakistan back in 2016, with local banks and financers, the official shared. Credit lines worth $120 million for LNG and $100 million for oil imports are expected from SOCAR. 

The proposal under discussion will also allow the country to avail the deferred payment facility for 60 days, he added. 

In August 2022, LNG spot prices soared to a record high of $69.9 per million British thermal units (mmBtu) for Asia after the Russian invasion of Ukraine and subsequent supply chain disruptions in Europe. 

However, prices have dropped by around 40 percent since January as demand remains weak. Last week , the average LNG price for the April delivery was $16 per mmBtu for Asian deliveries, which further dipped to $14.6 per mmBtu on February 20, 2023. 

Pakistan meets more than half of its LNG requirements through long-term import contracts while it meets gaps in demand through spot cargo purchases. Islamabad has long-term agreements with Gunvor and ENI— multinational commodity and energy trading companies— for the supply of an LNG cargo every month. 

Energy officials have said the country is not in a position to resort to the LNG spot market due to its current financial crunch, despite a significant cut in prices in the global market. 

The average import bill of Pakistan for the first seven months of the current fiscal year (FY23) remained over $5 billion while the country’s state bank has reserves of only $3.1 billion left.

Pakistan has restricted imports to prevent the outflow of dollars, slowly clearing cargo at the ports as banks delay or deny opening of Letters of Credits (LCs) for importers. 

Petroleum sector experts say the import of petroleum products, given Pakistan’s current economic climate, is good news that will provide the country— already low on forex reserves— some breathing space. 

“Under the current economic situation of Pakistan, the import of oil from Azerbaijan is a welcome move that the country desperately needs,” Tahir Alam, general secretary of the Petroleum Club of Pakistan, told Arab News. 

“However, it still remains to be seen at what terms and conditions the imports will be materialized and how beneficial it would be for Pakistan in the long term.” 

Under the credit line for the petroleum products, the country is negotiating for the import of at least two cargos of Mogas (motor gasoline) a month through the state-owned Pakistan State Oil (PSO), the official said. 

Ex-PM Khan shifted to Rawalpindi’s Adiala Jail on court’s orders

Updated 26 September 2023

Ex-PM Khan shifted to Rawalpindi’s Adiala Jail on court’s orders

  • A day earlier, Islamabad High Court ordered authorities to shift Khan to Adiala Jail 
  • Khan had filed a petition seeking to be transferred from high-security prison in Attock

ISLAMABAD: Former prime minister Imran Khan was moved on Tuesday to Rawalpindi’s Adiala Jail from a prison in Attock two days after orders from the Islamabad High Court, the Pakistan Tehreek-e-Insaf (PTI) party said. 
Khan’s Pakistan Tehreek-e-Insaf (PTI) party said earlier during the day that its chairman was not shifted to Adiala Jail despite the Islamabad High Court’s (IHC) directives on Monday. The cricketer-turned-politician was arrested on Aug. 5 and taken to a high-security prison in Attock after a trial court in Islamabad found him guilty of “corrupt practices” in a case involving the unlawful sale of state gifts during his tenure as prime minister from 2018 to 2022.
The IHC suspended Khan’s sentence on Aug. 29 but he remains in jail on remand in another case, popularly called the cipher case, in which he is charged with leaking state secrets. The latest extension of the remand order will keep Khan in jail until Oct. 10. Meanwhile, the former PM had filed a petition with the IHC seeking his transfer to Adiala Jail.
“PTI Chairman Imran Khan, who has been serving a three-year sentence in the Toshakhana case at the Attock Jail, was on Tuesday shifted to Rawalpindi’s Adiala jail on directives of the Islamabad High Court (IHC),” Pakistan’s English-language daily Dawn said.
Separately, the PTI shared a video from the Islamabad Toll Plaza in which a few party supporters could be seen showering rose petals at the convoy of police cars transporting Khan. 

On Monday, IHC Chief Justice Aamer Farooq observed that under-trial prisoners (UTPs) of all the courts in the federal capital were kept at Adiala, issuing directions to shift Khan to that prison.
In the state secrets case, Khan is charged with making public the contents of a confidential cable sent by Pakistan’s ambassador to the United States and using it for political gain, according to the Federal Investigation Agency (FIA).
Khan alleges that the cable proves the United States had pressed Pakistan’s military to orchestrate the fall of his government because he had visited Russia shortly before its invasion of Ukraine in February 2022.
Washington and the Pakistani military have denied Khan’s accusations.
The former prime minister also faces a range of other legal cases he says are politically motivated.


Pakistan moves to remove investment impediments in agriculture, IT, mining and energy sectors

Updated 26 September 2023

Pakistan moves to remove investment impediments in agriculture, IT, mining and energy sectors

  • Pakistan in June set up Special Investment Facilitation Council, a civil-military forum, to attract foreign funding
  • SIFC’s executive committee meets to review measures to improve Pakistan’s investment environment

ISLAMABAD: Pakistan’s top investment body on Tuesday said it had finalized plans to resolve key issues related to the country’s economic sectors of agriculture, information technology, minerals and energy.
Pakistan in June set up the SIFC — a civil-military hybrid forum — to fast-track decision-making and promote investment from foreign nations, particularly from Gulf Cooperation Council (GCC) nations. The council has pinpointed five key sectors for attracting investment: agriculture, mining, information technology, defense production, and energy.
The South Asian country established the council as it grapples with a serious economic crisis that has seen its currency weaken against the US dollar over the past one year amid staggering inflation. Pakistan is also facing an acute balance of payments crisis amid increasing foreign debt.
The SIFC’s executive committee held its fifth meeting on Tuesday to review measures for improving the investment environment in the country, a statement from the body said.
“After healthy debate, the Committee formulated workable options, by drawing consensus among stakeholders, to resolve key impediments to investment environment in the country,” the SIFC said. “The plans were also finalized to resolve issues related to four key sectors (Agri, IT, Minerals and Energy) besides, adding new projects to the forum.”
Last week, Pakistan’s Caretaker Prime Minister Anwaar-ul-Haq Kakar, during his visit to New York to attend the UN General Assembly, met business and thought leaders and stakeholders to pitch the forum to them and made the case for improved business climate in Pakistan together with its potential for foreign direct investment in a range of sectors.
Earlier this month, Kakar confirmed Saudi Arabia and the United Arab Emirates (UAE) would invest $25 billion each in cash-strapped Pakistan within the next five years as part of projects under the SIFC.
Saudi Arabia has also explored investment opportunities in Pakistan’s mining sector and contributed $500 million to modernize Pakistan’s agricultural sector through the Land Information and Management System Center of Excellence (LIMS-CoE). This continued financial backing from Gulf allies is crucial for Pakistan’s economic stability.

PM Kakar says military ‘here to stay’ in Pakistan’s politics

Updated 26 September 2023

PM Kakar says military ‘here to stay’ in Pakistan’s politics

  • PM Kakar says military only institution in Pakistan with organizational capability to tackle governance issues
  • Says Pakistani civilian institutions have been ‘performing poorly’ over the past three to four decades

ISLAMABAD: Caretaker Prime Minister Anwaar-ul-Haq Kakar said this week that Pakistan’s military is “here to stay” in the country’s politics, adding that civilian institutions would have to enhance their capabilities to ensure the military does not meddle in their affairs.

Pakistan’s military has ruled the country directly for more than three decades of its 76-year existence, wielding an iron, if cloaked, grip on politics even from behind the scenes. The last time the military dismissed a Pakistani civilian government and seized power was in 1999. The army now says it no longer interferes in political affairs.

Speaking to Turkish public broadcaster TRT World on Monday, Kakar acknowledged the existence of an imbalance in Pakistan’s civil military relations. He said civilian institutions in the country responsible for service delivery “are performing quite poorly” since the past three to four decades. The Pakistani prime minister said the military was the only institution in Pakistan with the organizational capability to tackle the country’s governance issues.

When asked if the military “is here to stay” for the foreseeable future in Pakistan’s politics, Kakar responded:

“Well, pragmatically, realistically, and honestly if I have to answer it, affirmative. Yes.”

Kakar said Pakistani politicians had formed alliances with the military over various periods of time to attain political power, adding that once out of government, they shift the blame on the military for their own governance failures.

“If someone is genuinely interested that the military should not meddle in the affairs of the state structure, which probably is not their role, then we need to enhance the capabilities of the civilian institutions,” he said.

“The solution is not to weaken or dwindle the organizational strength of the current military.”

A relatively lesser-known political figure with apparent ties to the military, Kakar assumed the role of Pakistan’s caretaker prime minister in August. He has been tasked with heading an interim government charged with overseeing the upcoming national elections, a responsibility that comes at a critical juncture when Pakistan is confronting a multifaceted web of political and economic challenges.

Earlier this month, Kakar said the military was providing the inputs his government was seeking and that his government did not feel it was being “dictated” to.

“They are not overstepping even slightly,” he said during a briefing to foreign media representatives.

Pakistan announces ‘important amendments’ to anti-money laundering, terror financing regulations

Updated 26 September 2023

Pakistan announces ‘important amendments’ to anti-money laundering, terror financing regulations

  • Amendments empower third parties to conduct customer due diligence
  • Pakistan remained on the FATF’s ‘grey list’ from 2018 till October 2022

ISLAMABAD: Pakistan’s top financial regulator said on Tuesday it had amended the country’s anti-money laundering and counter-terrorism financing regulations to effectively curb crimes and strengthen its financial system.

International watchdog Financial Action Task Force (FATF) removed Pakistan from its “grey list” after four years in October 2022. The list is composed of countries with a high risk of money laundering and terrorism financing but which have formally committed to working with the task force to make changes.

The decision was taken after the South Asian country took stringent measures to comply with the FATF’s demands by acting against those linked to money laundering and terror financing. Being on the Paris-based watchdog’s grey list can scare away investors and creditors, hurting exports, output and consumption. It also can make global banks wary of doing business with a country.

“The Securities and Exchange Commission of Pakistan (SECP) has introduced important amendments to the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Regulations, 2020,” the SECP said in a press release.

“The notified amendments aim to enhance the scope of regulations to effectively combat financial crimes, control money laundering, and combat the financing of terrorism (CFT) while ensuring the integrity of its financial system.”

The SECP said the amendments were an outcome of a self-assessment of its AML/CFT framework conducted by the commission this year. It added that the assessment was made against the criteria used in the FATF Assessment Methodology for assessing Technical Compliance of its AML/CFT regulatory framework.

According to a notification, the amendments empower a “regulated person” or a financial entity, to engage a third party to carry out a series of checks to ensure a customer’s identity, or Customer Due Diligence (CDD) and also verify the identity of beneficial owners.

“Provided that despite the third party reliance, the regulated person shall remain liable for any failure to apply the indicated CDD measures,” the SECP said.

The amendments also make it mandatory for the financial institution to ensure that their foreign branches and majority-owned subsidiaries in countries which do not sufficiently apply the FATF’s recommendations, apply Pakistan’s AML & CFT measures “to the extent that host country laws and regulations permit.”

“If the foreign country does not permit the proper implementation of AML/CFT measures consistent with that of Pakistan requirements, financial groups should apply appropriate additional measures to manage the risks, and inform the Commission when a foreign branch or subsidiary is unable to observe appropriate AML/CFT measures,” it added.

The revised regulations also state that an account will be classified as dormant after three years of inactivity, as opposed to the previous threshold of five years. The amendments also contain regulations for opening a bank account for mentally disabled persons, such as proper verification of the identity documents of the disabled person and their court-appointed managers.

After 4 months, Pakistan resumes issuing ID cards to transgender people, officials say

Updated 26 September 2023

After 4 months, Pakistan resumes issuing ID cards to transgender people, officials say

  • Pakistan halted issuing ID cards after an Islamic court ruled in May transgender people cannot change their gender 
  • In 2018, Pakistani parliament passed legislation to protect the fundamental rights of transgender individual

ISLAMABAD: Pakistani authorities resumed issuing ID cards to transgender people, officials and activists said Tuesday, after a four-month pause and following an Islamic court’s ruling that gutted a law aimed at protecting trans rights.

The national database and Registry, or NADRA, halted the cards after an Islamic court ruled in May that trans people cannot change their gender at will and that giving them equal rights goes against Islam.

The court said authorities should stop issuing cards with the X designation signifying a third gender that is neither male nor female. An ID card is needed to open a bank account, get a driver’s license, access medical care and other everyday services in Pakistan.

The Islamic court has the constitutional mandate of examining and determining whether laws passed by Pakistan’s parliament comply with Islamic doctrine.

Activist Farhatullah Babar told The Associated Press that human rights activists have appealed the court’s ruling to get it reversed on the grounds that it denied trans people basic rights.
NADRA officials confirmed they resumed giving out ID cards to trans people and explained their legal team had concluded they can do so since the Islamic court’s ruling has now been challenged. Under Pakistani laws, a court ruling cannot go into effect until an appeal or review petition is decided.

Parliament in 2018 adopted the Transgender Persons (Protection of Rights) Act to secure the fundamental rights of transgender Pakistanis, including their access to legal gender recognition.

But many in the Muslim-majority country have entrenched beliefs on gender and sexuality and trans people are often considered outcasts. Some are forced into begging, dancing and even prostitution to earn money. They also live in fear of attacks.

NADRA’s decision was welcomed by Nayyab Ali, a trans activist.

“Congratulations to the entire community of transgender activists in Pakistan for your relentless struggle,” she posted on Monday on X, formerly known as Twitter. “A heartfelt thank you to all the institutions.”