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Profit UAE PRESIDENT COMMITS $10B INVESTMENT IN PAKISTAN Friday, 24 May, 2024 I |15 Zil-Qadah, 1445
PM SHEHBAZ REAFFIRMS PAKISTAN’S COMMITMENT TO IMPLEMENT INVESTMENT COOPERATION AGREEMENTS IN ENERGY, PORT OPERATIONS, FOOD SECURITY, LOGISTICS, MINERALS, AND BANKING & FINANCIAL SERVICES
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Rs 20.00 | Vol XIV No 324 I 8 Pages I Islamabad Edition
PROFIT APP
RESIDENT of the United Arab Emirates (UAE) Sheikh Mohamed bin Zayed Al Nahyan on Thursday assured his country’s full support to Pakistan in all circumstances, pledging to invest $10 billion in its multiple sectors. The UAE President made the commitment during a bilateral meeting with Prime Minister Muhammad Shehbaz Sharif. The meeting provided an opportunity to discuss the whole gamut of bilateral relations, including cooperation in political, economic, social, cultural and defence sectors. The prime minister underscored the importance of galvanizing existing cooperation and strengthening strategic partnerships including in the fields of information technology, renewable energy and tourism.
He highlighted the steps taken by the government aimed at ensuring socio-economic stability in the country and building the investors’ confidence. He reiterated Pakistan’s commitment to ensure meaningful implemen-
tation of investment cooperation agreements in the areas of energy, port operations projects, wastewater treatment, food security, logistics, minerals, and banking & financial services. PM Shehbaz expressed gratitude
to the UAE leadership for hosting 1.8 million Pakistani diaspora and highlighted Pakistan’s huge human resource potential that could be engaged in multiple sectors. Both leaders exchanged views on other issues of mutual interest, including regional and global developments. The prime minister reiterated his invitation to the UAE president for an official visit to Pakistan, which was accepted by the latter. PM Shehbaz was accompanied by Deputy Prime Minister and Foreign Minister Muhammad Ishaq Dar, Minister for Commerce Jam Kamal Khan, Minister for Defence Khawaja Muhammad Asif and Special Assistant to Prime Minister Syed Tariq Fatemi. The prime minister also offered condolences on the passing away of close family members of Al Nahyan family, late Sheikh Tahnoun bin Mohamed Al Nahyan and late Sheikh Hazza bin Sultan Al Nahyan.
ECC likely to green-light $2.58m package for Chinese workers killed in Besham attack
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‘Cypher Case’: FIA seeks IHC’s nod to present Lu’s congressional testimony
IMC ALSO RECOMMENDS RS2.5M COMPENSATION FOR PAKISTANI NATIONAL KILLED IN SAME ATTACK
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AMOUNT TO BE TRANSFERRED TO ACCOUNT OF PAKISTAN EMBASSY IN BEIJING FOR ONWARDS TRANSFER TO VICTIMS’ FAMILIES
ISLAMABAD
STAFF REPORT
The Federal Investigation Agency (FIA) on Wednesday sought permission of Islamabad High Court (IHC) to present the statement of US Assistant Secretary Donald Lu given before a congressional committee in Washington as evidence in the cypher case. In a miscellaneous application, the FIA requested the IHC bench, comprising Chief Justice Aamer Farooq and Justice Miangul Hassan Aurangzeb, to allow filing of more evidence in the cypher case against Pakistan Tehreek-e-Insaf (PTI) founder Imran Khan and senior leader Shah Mahmood Qureshi. During the hearing, the chief justice expressed concern that the FIA wanted to present extra evidence when the hearing of the appeals was about to complete. Justice Miangul Hassan asked whether the prosecutor wanted to present Lu as a witness or it might be an attempt to delay the case. Chief Justice Aamer Farooq said that as per the criminal law the prosecution had to tell the reasons that whether the evidence was relevant. Though the prosecution had the legal right to file a miscellaneous application, he added, the court had serious reservations on its filing at the current stage. During the hearing, the Islamabad advocate general informed the court that state counsel on behalf of the PTI founder and Qureshi were appointed on January 26, and they appeared before the trial court on January 27. State counsel Abdul Rehman said that when they appeared they were instructed by the trial court to conduct the cross-examination. The court sought affidavit from the state counsel, who had conducted the cross-examination of witnesses on behalf of the two accused. The court summoned the special prosecutor for arguments on Friday and adjourned the case.
ISLAMABAD STAFF REPORT
The Economic Coordination Committee (ECC) is likely to greenlight a $2.58 million compensation package for the employees of a Chinese company killed in Besham terror attack on March 26. According to senior officials of the Cabinet Division, the Economic Coordination Committee (ECC) is expected to approve the compensation package in its next meeting. The Inter-Ministerial Committee (IMC) has recommended the amount as compensation to the ECC based on the GDP per capita and purchasing power parity. Similarly, a compensation of Rs2.5 million has also been recommended for a Pakistani national
who was killed in the same attack. The official source claimed that the committee’s secretariat has received a summary seeking $2.58 million in compensation for the five Chinese employees of China Gezhouba, the company working on Dasu Hydropower project. The amount will be transferred to the account of the Pakistan embassy in Beijing, which will then transfer the payments to the families of the victims via appropriate channels. The IMC recommended the compensation almost two months after the Besham terror attack that claimed the lives of six people — five Chinese engineers and one Pakistani — working on the Dasu Dam. The victims were killed when an explosive-laden vehicle hit a
bus carrying Chinese workers on Karakoram Highway in Besham area. Following the attack, civil work at the sites of the Dasu and Diamer-Bhasha Dams was temporarily suspended by the Chinese companies overseeing operations due to security concerns. Approximately 991 Chinese engineers were working on both projects, while the local staff was told to stay at home till further instructions. Reacting to the deadly attack, Chinese Foreign Ministry Spokesperson Lin Jian termed the terror bid an attempt to sabotage China-Pakistan relations. “Beijing remains firm in its commitment to working with Islamabad in various fields,” the official said.
IMF demands parliamentary approval for critical economic reforms by June 30 g
REVISED TAX MEASURES AND ENERGY TARIFFS UNDER DISCUSSION AS GOVT AIMS TO MEET IMF CONDITIONS FOR FINANCIAL AID PROFIT
MONITORING DESK
Pakistan faces a crucial deadline of June 30 to implement a series of reforms, primarily through binding parliamentary approvals and legislation, to finalize a staff level agreement (SLA) with the International Monetary Fund (IMF) for its upcoming bailout program. This development surfaces as the fortnight-long dialogue between Pakistani authorities and the IMF mission concludes. Led by Nathan Porter, the IMF staff mission wrapped up discussions covering pivotal economic sectors including major reforms in power and gas, stateowned entities, pensions, revenue mobilization, and monetary policy adjustments in alignment with inflation expectations. Both parties have established a broad consensus on the necessary actions and their respective timelines, with a focus on ensuring these measures receive parliamentary sanction within the stipulated timeframe. One key requirement from the IMF is the parliamentary endorsement of the reform and policy actions, reflecting the need for stability given the volatile political climate. The mission is set to depart this Friday, with plans to formally announce the SLA by the end of June or early July 2024, contingent on satisfactory compliance with the agreed measures. These measures include adjustments in gas and electricity tariffs, approval of taxation and trade tariff policy measures, and amendments in tax laws which are to be enacted through the Finance Bill 2024-25. The federal budget, crucial for implementing these changes, is scheduled for presentation on June 7, just after the Eid-ul-Azha holidays, allowing limited time for parliamentary debate. Tax-related measures are a significant part of the discussions, with plans to simplify tax slabs for salaried individuals, redefine agricultural income taxation, and increase penalties for non-compliance among tax filers. Additionally, discussions have included removing the cap on the petroleum development levy and introducing a carbon tax aimed at revenue enhancement and creating financial buffers. On the energy front, both sides have agreed on upward revisions of natural gas prices for various sectors beginning the new fiscal year and have discussed detailed plans for reducing the gas sector’s circular debt. Moreover, the IMF and World Bank have been involved in discussions on managing rising capacity payments and addressing the debt repayment challenges associated with CPEC-related projects. A list of 24 state-owned enterprises (SOEs) has been shared with the IMF, categorizing them for strategic relevance or potential privatization, underscoring Pakistan’s commitment to reducing government involvement in business functions better served by the private sector. As discussions continue, the future of state-run media and other public enterprises remains a key topic, with both sides exploring options to enhance transparency and efficiency in these institutions.
New bailout package contingent on IMF-approved budget g
GOVT MUST MEET STRINGENT IMF REQUIREMENTS TO SECURE EXTENDED FUND FACILITY, GLOBAL LENDER TELLS PAKISTANI AUTHORITIES PROFIT
MONITORING DESK
The visiting IMF team has informed Pakistani authorities that the next bailout package under the Extended Fund Facility (EFF) will only be considered after presenting an aligned upcoming budget for the fiscal year 2024-25 and securing its approval from parliament. This could initiate formal negotiations and lead to a staff-level agreement for a fresh bailout package, possibly augmented by $6 to $8 billion in climate finance, likely in July 2024.
According to a news report, the IMF team collected data on major economic fronts and specified the type of budget they expect for 2024-25. The government needs to devise a roadmap for increasing the taxto-GDP ratio, which might decline to 9 percent of GDP for the current fiscal year. The FBR is struggling to collect Rs 9.415 trillion, and independent experts predict a shortfall. If the FBR collects Rs 9 trillion, the IMF will require an increase to over Rs 12 trillion in the next budget, necessitating a Rs 3 trillion increase despite a nominal growth rate of 16%. Non-tax revenue targets will also rise, with a carbon
levy under consideration. On the expenditure side, the IMF team urged the government that it must rationalise SOEs, pensions, and subsidies to reduce current expenditures. Development projects of a provincial nature will be abandoned in the next fiscal year. Regarding tariffs, the IMF has called for raising the power tariff through baseline, fuel price adjustment, and quarterly adjustments. Gas tariffs will also increase. For solar net metering, the government plans to hire a Chinese consultant to study the issue independently due to its impact on DISCOs’ grids and the power sector’s fiscal woes.