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Commerce body says mini-budget will offer incentives to industries that will set direction of economy.  RAWALPINDI: The Rawalpindi Chamber of Commerce and Industry (RCCI) on Friday termed the  supplementary finance bill 2019 business friendly . “It will offer incentives to Small Medium Enterprises (SMEs), industry, agriculture and capital market that will set the direction of the economy,” RCCI President Malik Shahid Saleem said in a press release. He said that despite economic crunch and a number of domestic and international challenges, the government had announced business and people-friendly reforms package but it needed to be implemented in letter and spirit from January instead of July 1. He said the government had incorporated in the Finance Bill majority of the proposals submitted by the traders and businessmen Finance Minister Asad Umar and adviser Abdul Razak Dawood. He said the new mini-budget would reduce the cost of doing business and acc...

This file photo taken on September 30, 2014 shows French Renault car maker CEO Carlos Ghosn giving a press conference during the inauguration of a new production plant in Sandouville.  Embattled Renault boss Carlos Ghosn has resigned, France's economy minister said on Thursday ahead of a board meeting at which the French carmaker is to appoint his successors. A senior director from the firm "received last night the letter of resignation from Carlos Ghosn", who  remains detained in Japan , Economy and Finance Minister Bruno Le Maire told  AFP . The Renault board is to meet on Thursday at its headquarters near Paris and is tipped to name interim chief executive Thierry Bollore as CEO and the head of tyre manufacturer Michelin, Jean-Dominique Senard, as chairman. Ghosn, who had held both roles, is expected to stay behind bars for several months after seeing a second bail request denied on Tuesday. He faces three separate charges: two of under-declar...

Amended finance bill reduces and abolishes several taxes as govt accepts long-standing demand of various sectors. ISLAMABAD: The amended finance bill has reduced and abolished several taxes as the government accepted the long-standing demand of various sectors including small enterprises, low-cost housing while charges on banking transactions has been abolished for filers. The amended finance bill, presented on Wednesday, has removed the Advance Income Tax on cash withdrawal and cash-denominated instruments from banks for filers, while the Federal Board of Revenue (FBR) will issue bonds in lieu of cash for pending refunds of industrialists. •  Promissory notes for sales tax refunds finalised   •  Tax reduction on intercorporate dividend for group cos  •   Customs duties on total of 75 products removed Briefing the media, FBR Member Policy Hamid Atiq said the inflows from this tax were a major source of revenue but the government has decid...

IMF's Christine Lagarde says risks rising as world's economy grows more slowly than expected. DAVOS: The International Monetary Fund on Monday cut its world economic growth forecasts for 2019 and 2020 due to weakness in Europe and some emerging markets, and said failure to resolve trade tensions could further destabilise a slowing global economy. The IMF predicted the global economy to grow at 3.5 per cent in 2019 and 3.6pc in 2020, down 0.2 and 0.1 percentage point respectively from last October’s forecasts. “After two years of solid expansion, the world economy is growing more slowly than expected and risks are rising,” IMF Managing Director Christine Lagarde told a briefing. The new forecasts, released on the eve of this week’s gathering of world leaders and business executives in the Swiss ski resort of Davos, show that policymakers may need to come up with plans to deal with an end to years of solid global growth.

The latest ‘Global Investment Trend Monitor’ says that the decline was concentrated in developed countries, while FDI in developing countries remained resilient.  ISLAMABAD: Global foreign direct investment (FDI) inflows fell by 19 per cent, in 2018, to an estimated $1.2 trillion — a level comparable to the low point reached after the global financial crisis of 2008, a new report of UN Conference on Trade and Development (UNCTAD) said on Monday. The latest ‘Global Investment Trend Monitor’ says that the decline was concentrated in developed countries, while FDI in developing countries remained resilient. Looking ahead, a rebound is likely in 2019 but the underlying trend remains weak, the report says. On the positive side, green-field project announcements - an indicator of future trends – increased by 29pc albeit from relatively low levels in 2017. Also, as repatriations abated in the third quarter of 2018, developed countries’ inflows will revert to norm...

The mini-budget will include amendments to rationalise capital gains tax, advance tax and promote listing of GoP and CPEC projects debts on PSX. ISLAMABAD: The third money bill of the fiscal year to be presented in the parliament on Jan 23 would offer major incentives to boost stock market, housing, agriculture and industrial sector besides imposing punitive duties on luxury imports. “The main factors of the economic package is to turn around manufacturing and exports, incentivise low-cost housing and facilitate agricultural financing to spur economic activities in the country”, confirmed Dr Khaqan Najeeb Khan, the finance ministry’s adviser and spokesman. Responding to a question, the spokesman said the package would have negative net revenue impact. When asked specifically about widespread speculation that the mini-budget will bring a 1pc increase in the GST rate, the ministry spokesman chose his words carefully and said only that “no taxation measure is env...

IN a policy shift, the PTI-led government has decided to shepherd foreign firms into joint ventures. “The government has made it mandatory for all foreign firms to invest in joint ventures with Pakistani firms so that the local companies could also get a boost, and deal with local issues in a better way,” Board of Investment (BOI) Chairman Haroon Sharif informed the second meeting on ease of doing business on Jan 9 in Islamabad. Currently, the government allows 100 per cent foreign equity with no minimum or upper limit. Foreign firms are also accorded the same treatment as local capital. Foreign firms have set up both private and public limited companies with majority shareholdings and control. Those listed with the bourse have offered their stocks to minority shareholders or entered into joint ventures with Pakistani partners. Some company managements, however, buy back their shares from minority shareholders to maximise their needed returns. It is not known if the gov...

Many of us were shocked when a man in Badin recently attempted to sell his eight-year-old daughter to an elderly landlord after failing to pay him back a Rs100,000 loan. It was shocking because we hardly ever ponder over the trade-offs that these landless and subsistence farmers have to make in their daily lives. “We frequently acquire financial help from our landlords, hoping we’ll be able to pay them back following the harvest season,” says a landless farmer from the union council of Massoo Bozdar in Tando Allahyar. Borrowing from landlords is a general practice among those farmers who don’t have access to financial services. According to one estimate, up to 85 per cent of farmers are still formally excluded from financial services. Agricultural loans account for only 7.6pc of total bank loans and are limited to Punjab for the most part. As we went to different villages of Sindh and talked to landlords and landless tenants, we found that the poor live on subsi...

Plan, that was completed in Dec 2018, is with planning department, says official. GWADAR: Chinese companies, which prepared the Gwadar Master Plan Smart City, have expressed concern over delay in its approval by the federal government. Sources said that the Gwadar Master Plan Smart City was prepared by China Communication Construction Company Limited and Fourth Harbour Engineering Investigation at a cost of Rs521 million, including a Chinese grant of Rs425m and Rs91m provided by the government of Pakistan. The sources said the companies had started work on the master plan in August 2017 and completed it in December 2018 and forwarded the plan to the federal government for approval, but it has not been approved so far. “The plan is with the steering committee of the planning and development department,” a senior official told  Dawn  in Gwadar. The governing body of the Gwadar Development Authority had already approved the plan. “Chinese companies hav...

In Pakistan, the government keeps switching gears from central bank borrowing to commercial bank borrowing.  BANKS generally lend generously to the private sector when government borrowing is down. But they queue up to invest funds in treasury bills and bonds as soon as the government decides to shift its borrowing from the central bank to commercial banks. “The time for that has already arrived,” says the president of a local bank, adding that the government is expected to make some net borrowing in the ongoing second half of 2018-19 unlike the first half when it kept retiring debts of commercial banks. Senior executives of several other banks also share this assessment. Is that wishful thinking? A quick analysis of monetary data from past years shows, it is not. In Pakistan, the government keeps switching gears from central bank borrowing to commercial bank borrowing. Banks are smart enough to predict the timing of this switchover with accuracy. Since the ...

THE government is contemplating the launch of a new state-owned holding company — Sarmaya Pakistan — soon. It will hold and manage nearly 200 state-owned enterprises (SOEs) and undertake strategic decisions to turn them around and make them operational. The idea behind the establishment of the holding company is to free the SOEs (like PIA, Pakistan Steel Mills, etc) of political influence and place them under the control of successful business executives. The creation of the SOE holding company is part of the election programme of the ruling PTI. According to its plan eight of the company’s 11 board members, including its chairman, will be picked from the private sector. The remaining three will represent the government on the board. However, the government is yet to make public the legal framework under which the company will operate. Finance Minister Asad Umar believes it to be a responsibility of the state to turn around loss-making state-owned businesses. But the former...