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Thursday, 9 January, 2025 I 8 Rajabul Murajjab 1446
Rs 20.00 | Vol XV No 184 I 8 Pages I Karachi Edition
PM SHEHBAZ EMPHASIZES HONORING IMF COMMITMENTS TO ENSURE ECONOMIC STABILITY
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Staff RepoRt
RIME Minister Shehbaz Sharif on Wednesday underscored the importance of adhering to International Monetary Fund (IMF) commitments, affirming that the government cannot prematurely exit the program. He stated that Pakistan would part ways with the IMF only when the country is economically stable and self-reliant. Addressing the business community at the Pakistan Stock Exchange (PSX), the premier highlighted Pakistan’s progress under the $7 billion, three-year IMF aid package agreed upon in July 2024. He noted the nation’s slight improvement in tax-to-GDP ratio, reaching 10.8%, surpassing the IMF target of 10.6%, but emphasized the need for further advancements. He further emphasised the need for investment, beyond meeting tax targets, citing the State Bank of Pakistan’s reduction of interest rates from 22% to 13% as a step toward fostering investment. PM Shehbaz stressed the importance of export-led growth and foreign direct investment (FDI), urging stakeholders to provide actionable strategies to achieve these goals. He also called for a cautious but
PRIME MINISTER CALLS FOR EXPORT-LED GROWTH AND STRONGER PUBLIC-PRIVATE COLLABORATION
bold approach to economic expansion, emphasizing the need to avoid the boom-bust cycles that have plagued the country in the past. The prime minister highlighted the transparency in ongoing privatization efforts, using the example of Pakistan International Airlines (PIA) and the nearly concluded process for Islamabad Airport. He invited critics to propose alternatives to Pakistan’s growth strategy, emphasizing that sustainable growth is the only viable path forward. During his day-visit to Karachi, PM Shehbaz also inaugurated the Federal Board of Revenue (FBR)’s Faceless Customs Assessment System at Karachi Port Trust, aimed at improving transparency in customs processes. Additionally, he attended the launch of the Aga Khan University Manual of Clinical Practice Guidelines. The premier’s visit coincided with a sharp decline in the KSE-100 index, which dropped by 1,904.23 points (1.64%) to close at 114,148.45. Despite the setback, the prime minister expressed optimism about the country’s economic future and reaffirmed the government’s commitment to long-term stability.
KP takes lead in debt servicing with Rs30b deposit to management fund
Provincial govt allocated Rs20b each to pension and gratuity funds in six months, alongside generating Rs3-4b in profits through efficient fund management, says Advisor Muzammil Aslam PROFIT
Staff RepoRt
Khyber-Pakhtunkhwa (KP) has made history by becoming the first province to actively reduce its debt burden as the provincial government has deposited Rs30 billion into the Debt Management Fund and plans to add another Rs30-40 billion, according to Muzammil Aslam, Advisor to the Chief Minister on Finance and Interprovincial Coordination. Highlighting recent accomplishments, Aslam revealed that the Debt Management Fund is designed to manage up to 10% of KP’s total debt of Rs725 billion, Aslam stated in a press release. He said that KP has allocated Rs20 billion each to pension and gratuity funds over the past six months, alongside generating Rs34 billion in profits through efficient fund management. Additionally, the province has secured three months’ worth of advance salary funds, marking significant improvement from past challenges in salary disbursements.
‘I would like interest rate to be further reduced to 6%’ PROFIT
Staff RepoRt
Prime Minister Shehbaz Sharif on Tuesday emphasized the need for further reductions in Pakistan’s policy rate, stating that it could be slashed by an additional 8 percentage points despite the recent cut to 13%. “I would like the interest rate to be further reduced to 6%,” he said while addressing a ceremony at the Pakistan Stock Exchange (PSX). The prime minister highlighted the government’s focus on transforming macroeconomic stability into sustained economic growth. He announced plans to engage financial experts from Karachi and other cities to create a unified strategy for achieving the country’s economic targets. Shehbaz called for actionable proposals to drive export-led growth and capitalize on Pakistan’s natural resources. “Pakistan’s economy is back on its feet,” he said, while emphassing the
Federal ministries, divisions fall short on RTI act compliance: FAFEN
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SHORTFALL FUELS MISINFORMATION ON SOCIAL MEDIA, WEAKENING PUBLIC TRUST ISLAMABAD
Staff RepoRt
The Free and Fair Election Network (FAFEN) has revealed that most federal ministries and their divisions are not meeting the proactive disclosure requirements mandated by the Right of Access to Information Act (RTI), 2017. This shortfall, FAFEN warned, fosters the spread of misinformation and disinformation. It highlighted that a lack of timely and authentic information on public bodies and their functions could inadvertently fuel such issues, particularly on social media, undermining the credibility of government institutions. FAFEN stressed that proactive information disclosure via technology must be prioritized instead of relying exclusively on legislative and regulatory actions to curb misinformation, which could be misused. Such measures, it stated, could counter misinformation effectively while improving transparency and public trust. According to FAFEN’s evaluation of the websites of 40 divisions across 33 ministries, none fully complied with the RTI Act’s requirements for online information disclosure as outlined under Article 19-A of the Constitution. Over one-third of the ministries also failed to respond to information requests as stipulated by the law.
The assessment, conducted from April to June 2024, evaluated compliance using Section 5 of the RTI Act, which covers public body overviews, reports, services, personnel details, policies, decision-making processes, financial information, and information access mechanisms. The division-wise analysis showed significant compliance disparities. The Cabinet Division and the Inter-Provincial Coordination Division ranked highest, achieving 42 percent compliance with Section 5 of the RTI Act. Fifteen divisions fell within the compliance range of 31 percent to 40 percent. Among these, six divisions Establishment, Petroleum, National Heritage & Culture, Revenue, Interior, Planning & Development, and Special Initiatives achieved 38 percent compliance each. Meanwhile, seven divisions Commerce, Communications, Federal Education & Professional Training, Foreign Affairs, Privatization, Religious Affairs & Interfaith Harmony, and Water Resources reported 35 per cent compliance each. Thirteen divisions fell within the 21 to 30 percent compliance range. These included Aviation, Defence, Defence Production, Economic Affairs, Power, Human Rights, Law and Justice, Parliamentary Affairs, Railways, and Science and Technology divisions, all at 27 percent compliance. The Finance, Industries and Production, and National Food Security and Research divisions scored the lowest at 23 percent.
Constitution, not parliament, reign supreme: Justice Mandokhel ISLAMABAD
Staff RepoRt
Supreme Court’s Justice Jamal Mandokhel on Wednesday observed that the country’s Constitution, and not the Parliament, is supreme, emphasizing that citizens could not be denied their rights even under Article 5. Justice Jamal Mandokhel made the remarks as the Supreme Court’s constitutional bench resumed hearing on the intra-court appeals filed against declaring
need for future expansion. He added that the country is moving in the right direction despite ongoing challenges. On the privatisation of state-owned entities, the premier assured a fully transparent process, citing the example of the ongoing privatisation of Pakistan International Airlines (PIA) and Islamabad Airport. Reiterating the government’s commitment to fulfilling International Monetary Fund (IMF) conditions, the prime minister expressed hope that Pakistan would eventually outgrow its reliance on the global lender. “There will come a time when we can say goodbye to the IMF,” he stated. During his visit to Karachi, Shehbaz stressed the vital role of the private sector in economic growth and called for increasing tax revenues to meet national targets. He lauded Karachi as the hub of Pakistan’s economy, symbolizing the country’s resurgence.
the trials of civilians in military courts as null and void. The seven-member bench, headed by Justice Aminuddin Khan, is conducted the hearing. During proceedings, Khawaja Haris, the counsel for the Ministry of Defence, continued his arguments in the case. He said that the basis of the apex court’s decision was Articles 5 (8) and 3 (8) of the constitution. “Both articles are completely different. They cannot be coalesced together,” he argued.
Justice Muhammad Ali Mazhar remarked that Article 233 safeguarded the fundamental rights of citizens. Haris replied that Article 233 had two parts: one was related to the armed forces, while the other to civilians. Justice Jamal Mandokhel said that citizens could not be denied their rights even under Article 5. Haris recalled that it had been settled in the FB Ali case that civilians too could be tried in military courts. “Whether we agree with you or not remains to be
seen,” Justice Mandokhel said. The lawyer went on to say it was on the basis of a wrong interpretation that it was said that the FB Ali case was of a different nature. “Ali was tried after his retirement. At that time, he was a civilian,” Haris said, adding, “The judge gave the ruling that the defendant had committed the offence while he was in service; therefore his case was separate.” Justice Mandokhel retorted, “Those convicted in the May 9 cases did not belong to the armed forces.”
ECC raises concerns over green bond, defers decision on Rs1b govt guarantee g
PROPOSAL CRITICISED FOR WEAK BUSINESS PLAN; NAVTTC URGED TO ADDRESS KEY FINANCING GAPS PROFIT
Staff RepoRt
The Economic Coordination Committee (ECC) of the Cabinet has deferred a decision on providing a Rs1 billion government guarantee for the Pakistan Social Impact Bond (PSIB), citing concerns over an inadequate business plan and unresolved financing mechanisms. According to a news report, the PSIB, proposed by the Ministry of Federal Education and Professional Training, is intended to transition from traditional input-
based training models to demand-driven, outcomebased approaches. Initial funding of Rs1 billion, backed by a sovereign guarantee from the Finance Division, would be issued with the support of a risk investor, subject to ECC approval. During a recent ECC meeting chaired by Finance Minister Muhammad Aurangzeb, members criticised the proposal for lacking details on syndication strategies, take-out arrangements, and cash flow management. The finance minister also expressed concerns about the mechanism used for the Water and Power Development Authority’s (WAPDA) green bond,
highlighting its lack of provisions to mitigate government liabilities and their potential consequences. He noted that the same framework had been adopted for the Pakistan Social Impact Bond (PSIB), intended to secure financing for vocational and technical training initiatives. The Ministry of Federal Education defended the PSIB, explaining it as an outcome-based funding approach to address the financing challenges of the technical and vocational education and training (TVET) sector. The ministry highlighted that similar initiatives in countries like India, Vietnam, and the UK have successfully mobilised private investment and improved social outcomes. India, for instance, has raised over $600 million through Skill Impact Bonds in education and public health sectors.
IMF rejects Pakistan’s proposal to cut sales tax on electricity bills Decision underscores the lender’s firm stance on maintaining fiscal discipline under current loan programme PROFIT
Staff RepoeRt
The International Monetary Fund (IMF) has turned down a formal request by Pakistan’s Ministry of Energy to reduce sales tax on electricity bills, citing commitments under the current loan programme, according to Express News. The decision deals a blow to government efforts aimed at easing the financial strain on consumers. The Ministry of Energy had sought IMF approval for a reduction in sales tax rates, arguing it would provide much-needed relief to electricity consumers. However, IMF officials maintained that granting exemptions or reductions on new taxes would jeopardize Pakistan’s ability to meet its tax collection targets. Currently, an 18% Goods and Services Tax (GST) is imposed twice on electricity bill, once on the total bill amount and again on fuel cost adjustments. The IMF insists that these taxes remain intact to ensure compliance with fiscal targets under the loan agreement. In a separate move to align with IMF conditions, the federal government has agreed to impose a levy on captive power plants. The levy will be implemented gradually to mitigate a significant reduction in gas supply to these facilities. The report suggests that the IMF has shown flexibility on gas cuts to captive power plants but emphasized that the levy must be introduced before the release of the next funding tranche. This development underscores the government’s challenges in balancing economic reforms with public relief amidst mounting pressure from international creditors.
Govt declares FBR infrastructure as critical to safeguard sensitive data from cyberattacks Cabinet endorses Fly Dubai permit extension; e-Office rollout across ministries begins PROFIT
Staff RepoRt
The federal cabinet approved declaring the Federal Board of Revenue (FBR) infrastructure as critical under the Prevention of Electronic Crimes Act (PECA) 2016 to safeguard its sensitive data from potential cyberattacks and unlawful breaches. The Prime Minister’s Office (PMO) stated that the initiative aims to further protect the integrity of FBR’s data, a step deemed crucial following past incidents, including the leak of tax records of former Chief of Army Staff Gen Qamar Javed Bajwa’s family in 2021. The cabinet also extended temporary operating permits for Fly Dubai’s weekly flights from Lahore and Islamabad to Dubai from January 4 to February 3, 2025, following a recommendation from the Aviation Division. The Ministry of Information Technology and Telecommunication reported on the large-scale implementation of the e-Office system across federal ministries, marking the first such initiative. From January 1, 2025, all inter-ministerial communications will be paperless. The system has been fully deployed in 21 ministries and divisions, with processing times for summaries at the PM’s Office reduced to a maximum of three days. The cabinet approved the purchase of refurbished Chromebooks for schools and colleges, with a third-party audit mandated by the prime minister. Additionally, an MoU was endorsed between Pakistan’s Investment Board and China’s Shandong Ruyi Group to establish textile parks. The meeting concluded with the validation of decisions made by the Cabinet Committee on Legislative Cases during its meetings on December 31, 2024, and January 1, 2025. NAVTTC, established in 2006, is tasked with creating a market-driven workforce to meet industrial and self-employment needs, as well as to export skilled manpower. The ministry argued that PSIB represents a strategic shift in leveraging private capital for skill development, reducing the government’s financial burden, and reallocating public funds to other critical needs. The funding would support high-employability TVET programmes catering to both domestic and international labour markets. The ECC appreciated the concept of using capital markets to bridge financing gaps but emphasised the need for a comprehensive business plan. It directed the Ministry of Federal Education to address all key aspects, including syndication strategies and take-out arrangements, before resubmitting the proposal. The apex committee of the Special Investment Facilitation Council (SIFC) had previously approved the sovereign guarantee for PSIB in February 2024. The Finance Division has also supported the proposal, recommending it for further action. However, the ECC’s decision underscores the importance of a robust framework to ensure the initiative’s success.