Thursday, 15 December, 2022 I 21 Jamadi Awwal, 1444 I Rs 15.00 | Vol XIII No 166 I 12 Pages I Islamabad Edition
PM vows to coMPlete $7b extended fund facility PrograMMe with iMf g
DIrECTS AuTHorITIES CoNCErNED To TAKE NECESSAry STEPS To CoNTroL FISCAL AND CurrENT ACCouNT DEFICIT
ISLAMABAD
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staff report
rImE minister Shehbaz Sharif on Wednesday expressed the coalition government’s resolve to complete the current $7bn Extended Fund Facility programme with the International monetary Fund (ImF). Pakistan entered a $6bn ImF programme in 2019, which was increased to $7bn earlier this year. The programme’s ninth review is currently pending with remote talks being held between ImF officials and the government for the release of $1.18bn. Earlier on Wednesday, ImF resident representative for Pakistan Esther Perez ruiz told media that discussions between Islamabad and the international moneylender on the ninth review had been “productive” so far. Addressing a high-level meeting in the Prime minster’s House regarding the overall economic situation, the premier reaffirmed the commitment towards completing the ImF programme. “The ninth review of the ImF was discussed
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STrESSES EFForTS To INCrEASE LoCAL ProDuCTIoN oF ENErgy To END DEPENDENCE oN ImPorTED FuEL
while various measures to control the current account deficit were discussed. reiterating his determination to complete the ImF programme, the prime minister directed all concerned authorities to take necessary steps to control the fiscal and current account deficit,” a press release issued by the information ministry stated. During the meeting, Pm Shehbaz said that the government would focus on all “necessary policy and administrative reforms” with respect to controlling the deficits as he reviewed the present economic situation in detail and deliberated on a number of areas. The prime minister said that help and all possible facilities, including necessary facilities at ports, identification of new markets, and aid in importing raw materials and machinery, should be provided to exporters to support them in increasing their output Focusing on IT exports, in particular, Pm Shehbaz said their volume could be increased to $5bn from the current $2bn by supporting entrepreneurs and new business start-ups and providing them with facilities. The prime minister also stressed that over-
seas Pakistanis should be encouraged to send remittances through banking channels. regarding the energy sector, Shehbaz stressed that reforms should be implemented with “full attention and diligence”. “reducing circular debt is a top priority. Along with increasing power generation, we also have to deal with circular debt. We have to make efforts to increase the local production of energy so that dependence on imported fuel can gradually end,” the press release quoted him as saying. The prime minister said that the common man was burdened due to expensive imported fuel. “We have to relieve our people from these sufferings,” he added. Pm Shehbaz instructed that a campaign should also be initiated to improve general attitudes towards energy saving, stressing that people needed to be informed that saving energy was a “national need at this time”. The statement said that the meeting expressed concern about the state of the economy over the last four years, saying that it suffered the “worst disorder and destruction”. The meeting noted that gDP growth was 6.1 per cent when the previous government took over but “instead of improving the economic situation, poor governance and economic mismanagement made the economy stagnate.” “The meeting stated that public debt was rs25 trillion in 2018, which has increased to rs44.5tr in 42 months by march 2022. Similarly, other economic indicators also found the present government in a very bad condition. The current government has managed the situation in very difficult circumstances and has given economic stability to the country,” the press release reads. The meeting declared that due to the situation after the catastrophic floods, the process of economic recovery suffered a setback, but the incumbent government did not let economic difficulties hinder it in helping 33 million flood affectees. “The determination was reiterated that despite the flood situation, just as the current government did not allow a shortage of food grains and other essential items in the country, in the same way, the country will be gradually brought out of the vortex of economic difficulties.” Pm Shehbaz directed all ministries under the federal administration to save energy and control expenses by “adopting frugality”.
Imran says will give assemblies’ dissolution date in Liberty meeting LAHORE staff report
Former prime minister and Pakistan Tehreek-e-Insaf (PTI) Chairman Imran Khan said Wednesday that he will announce date for the dissolution of the Punjab and KP assemblies in Lahore’s Liberty Chowk public meeting on – December 17. “It’s is time to act as lengthy consultations have taken place and mere consultation can’t produce anything. I have completed consultations with the party and we have decided that in a gathering at Lahore’s Liberty Chowk, I will give my nation the date for the dissolution of the KP and Punjab assemblies,” PTI Chairman Imran Khan said in an address to the nation on Wednesday. The dissolution of assemblies would pave the way for elections. The law says that as soon as assemblies are dissolved, elections should be held within 90 days. So on Dec 17, I will give the date and after that 70 per cent of the country will go into election,” Imran Khan elaborated. “Logically, if elections are held in 70pc of the country […] then they might just hold general elections. But it is our misfortune that criminals are sitting [in the government] and they don’t care about the country,” he said. Imran claimed that the government was waiting for “round three of looting the
KSA proposes new measures, asks for policy incentives for oil refinery setup in Pakistan pROfIt REpORt ahmad ahmadani
Saudi Arabia has proposed fresh measures for setting up a new refinery in the Hub area of the Balochistan province on Wednesday. It has also asked for policy incentives for the life of the proposed refinery. According to sources, Saudi Arabia has proposed these measures to ensure the viability of the project, and along with policy incentives, it has also proposed third-party investment in critical infrastructure to reduce capex. They said that Pakistan has suggested 10 years for setting it up but no consensus has been reached so far and the ministry of Energy (moE) will soon revert on the incentives/measures proposed by Saudi Aramco. State-owned oil giant Pakistan State oil (PSo) in coordination with the Petroleum Division has
been preparing counter proposals/offers to address the concerns and requirements of the Saudi investors, added the sources. It is pertinent to remember that a memorandum of understanding (mou) was signed between the government of Pakistan and Saudi Arabia on February 17, 2019 for exploring investment opportunities in the refining and petrochemical sector. Soon after, a joint ministerial delegation visited Saudi Arabia during which a confidentiality agreement was signed between PSo and Saudi Aramco Aramco on April 23, 2019. The project was stalled due to CoVID-19 but in February this year, negotiation with Saudi Arabia kicked off again, and a meeting was held on February 16, 2022 between the then finance minister Shaukat Fayaz Ahmed with Khalid A. Al-Falih, minister for Investment, KSA, Chairman Board of Investment (BoI) and Chief Executive officer
(CEo) National Companies Promotion Program, KSA. resumption of work on the project was decided on. Later, PSo and Aramco exchanged letters to discuss feasibility and a virtual meeting was held on July 25 between the representatives of PSo, Aramco and the ministry of Energy of both sides, to work on improving the economics of the project, a plan which was then communicated formally to PSo. Inside sources say, the Saudi-side is insistent on long-term commitment and assurances for measures as proposed in their August 1, 2022 letter. However, no consensus has been reached so far but Pakistan’s Energy ministry is supposed to respond soon with feedback. A study that was conducted by HIS markit and reviewed in August 2019 shows that gasoline and diesel demand in Pakistan will reach 17.1 and 17.8 mmT per year by 2050. Consider-
ing the local production of these products, that is 2.6 and 5.8 mmT per year, a strong potential exists for a new fuel refinery. Effects of electric vehicles on total fuel demand will be minimal. A pre-feasibility study of a new refinery was also carried out by Advisian. This was to evaluate a refinery project with a capacity of 200-400 kbpd (Thousand Barrels Per Day). A gasolineoriented refinery configuration was considered, one with a capacity of 320-385 kbpd of 100% Arab Light crude. The capital cost was estimated to be around $ 10.5 billion with the project’s post-tax Irr (internal rate of return) of 9.2-9.3 pc (using IPP prices). moreover, out of two refinery locations, Hub was selected based on close proximity to the demand centre, shorter crude import distance and established local infrastructure – all of which will contribute to a significant reduction in capex.
country” and was “in no mood for elections” due to the fear of losing. “Their interests and the nation’s interests are on opposing ends.” Imran Khan said that he has received opinions from all party leaders. He added that he will not announce his decision as the time of consultation has concluded. Imran Khan announced that the assemblies will be dissolved in December. The session also discussed the legal aspects of the assemblies’ dissolution. Dr Babar Awan briefed the constitutional and legal grounds of the upcoming move. The PTI is likely to announce the same date for dissolving the KP and Punjab assemblies. After chairing the session, Imran Khan made the announcement to unveil the date for dissolving the provincial assemblies in Punjab and KP on December 17. He said that PTI will organise a gathering at Lahore’s Liberty Chowk on December 17 in which he will make the announcement. Elaborating on the future strategy, Khan said that around 125 PTI lawmakers will appear in the National Assembly (NA) to announce their resignations. In his address, Imran Khan said that concrete action is inevitable to avoid more losses. Slamming the acquittal of the top politicians in corruption cases, he said that cases against ‘big dacoits’ are being dissolved in a shameful manner.
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Currently, there are five players operating in the oil refining sector in Pakistan; Pak-Arab refinery Limited (PArCo), Attock refinery Limited (ArL), National refinery Limited (NrL), Pakistan refinery Limited (PrL) and Cnergyico Pk Limited (CPL). All of the refineries are hydro-skimming refineries, except for PArCo which is a mild-conversion refinery. Pakistan’s oil refining capacity is about 450,000 barrels per day (bpd), equivalent to 20 million tonnes per annum. The product slate typically comprises of energy products such as Naphtha, motor gasoline (mS), High Speed Diesel (HSD), Furnace oil (Fo), Kerosene, Jet fuel (JP-1&JP-8), High-octane Blending Component (HoBC), Liquefied Petroleum gas (LPg), Light Diesel oil (LDo) and non-energy products. Historically, local refineries have supplied about 60% of the country’s requirements of Diesel, 30% of motor gasoline and 100% of Jet fuel for defense. The rest is imported as refined products. Pakistan has been importing significant volumes of petrochemicals, worth more than $ 2 billion annually, as there is no primary petrochemical production facility in Pakistan.