ECC approves 1.2 trillion relief package to address Covid-19...

March 30, 2020: The Economic Coordination Committee (ECC) of the Cabinet Monday approved the fiscal stimulus package of Rs. 1.2 trillion aimed at addressing the ongoing challenges that emerged due to Covid-19 (Coronavirus) outbreak.

The ECC meeting was chaired by Adviser to the Prime Minister on Finance and Revenue Dr. Abdul Hafeez Shaikh here at the Cabinet Division, according to press statement issued by the finance ministry.

The purpose of the meeting was to fulfill the necessary requirements for different relief measures already announced by the prime minister for public due to the ongoing Coronavirus Pandemic, the statement added.

The ECC approved a Supplementary Grant of Rs. 100 billion for the Residual/Emergency Relief Fund in terms of article 84(a) of the constitution for provision of funds for mitigating the effect of COVID-19.

The special package for providing relief to the poor through cash assistance under the Ehsaas Program was also approved by the committee.

The package would provide cash grants to 12 million families under the regular “kafalat program” and Emergency Cash Assistance on the recommendation of the district administration.

The assistance would be provided for four months and besides the BISP beneficiaries, it would be one time dispensation, it said, adding the cash would be provided either in one installment of Rs 12000 through Kafalat partner banks i.e Bank Alfalah and Habib Bank Limited after biometric verification or it may be provided in two installments of Rs. 6000/- each.

The Poverty Alleviation Division was asked to present both options with feasibilities.

The partner banks should be asked to make arrangements through branchless banking networks to disburse cash. Rs 72.9 billion of additional funds through technical supplementary grant would be given to BISP under "Ehsaas Cash Assistance Package in Response to COVID-19" Pandemic.

After Ministry of Industries and Production presented a comprehensive proposals regarding the targeting parameters , implementation mechanism, cash assistance per family per month and financial phasing of the program, ECC approved Rs. 200 billion of cash assistance for the daily wagers working in the formal industrial sector and who had been laid off as a result of COVID-19 outbreak.

It was estimated that around three million workers would fall in this category and they would have to be paid a minimum wage of Rs.17500 per month.

The estimated cost of this provision for daily wagers comes around to Rs. 52.5 billion a month. The provincial labour departments would ensure the delivery of assistance to the laborers while the provision of funds should be the responsibility of the federal government.

The committee directed that immediate consultation with the provincial labor departments( mentioned under the provincial rules of business) should be carried out for providing timely assistance to those who were in need.

The ECC approved Rs. 50 billion for Utility Stores Corporation to provide essential food items to the vulnerable section of the society at subsidized rates.

USC has prepared an initial plan to deliver 9 essential food items @ Rs 3000 for a family of 2+4 people through Pakistan Post Foundation Logistics Division.

The corporation had further planned to procure essential items within 2-3 week, the statement added.

It was directed that USC should engage with BISP to obtain data for targeted assistance and again come back to the ECC for a detailed proposal for reaching out to the poor families for the effective use of this package before making any expenditure from this amount.

The ECC also approved Rs.75 billion for Federal Board of Revenue (FBR) to enable it to payback the sales tax and income tax refunds, duty drawbacks and customs duties which is due for the last 10 years. The amount would help approximately 676055 beneficiaries by improving their liquidity position.

The ECC also allowed reduction of different taxes and duties on import and supply of different food items for alleviating the adverse impact of COVID -19 on different sections of the society.

Rate of advance tax on the import of different pulses was reduced to 0% from 2%. Individuals and associations of persons (AoPs) providing tea, spices, dry milk and salt to USC without a brand name would pay 1.5% withholding tax instead of 4.5%.

Individuals and AoP receiving payments from USC for supplying ghee, sugar, pulses, and wheat flour shall be charged 1.5% withholding tax instead of 4.5% earlier.

Additional customs duty(ACD) @ 2% on soya bean oil, canola oil, palm oil and sunflower oil (and on these four oil seeds) had also been exempted.

ECC approved the supplementary grant of Rs. 30 billion to Ministry of Commerce to payback duty drawbacks to textile exporters in the current financial year to improve their liquidity position when their businesses are experiencing a slow down due to worldwide outbreak of Corona epidemic.

The committee was briefed SBP is working on payment of claims worth Rs. 49 billion out of which around 40 billion will be paid by June 2020.

The ECC approved a supplementary grant of Rs. 6 billion for Pakistan Railways to meet its expenses, the statement said, adding the Railways had suspended its passenger train services around the country since 19-3-2020.

The approved amount should be utilized for paying salaries to 70,000 employees, repairs, paying for utilities and performing disinfectant sprays on platforms and inside trains for proving safe journey to the passengers.

Currently Pakistan Railways is earning only 1/6th of its monthly income through coal freight and the rest is suspended, the statement concluded.



Risk-averse foreign investors pull out another $76.53 million on...

March 30, 2020 (MLN): The foreign net outflow continued to increase to $76.53 on March 27, 2020 from Pakistan’s sovereign debt securities and equity as fears of a global recession over COVID-19 spread heightened risk aversion.

According to the daily SCRA data published by SBP, the local market witnessed total inflows of $1.43 million on the said day whereas foreigners withdrew $74.65 million from T-bills and $3.31 million from local equities, aggregating the outflow of $77.96 million.

This month so far, international investors detached $1.65 billion (net) from T-bills, whereas, $81.37 million and $45.397 million (net) have been withdrawn from equities and PIBs respectively, bringing the total net outflows to arrive at $1.78 billion.

Cumulatively, from July to date, foreigners have poured $3.43 billion in T-bills, out of which $1.98 billion has been withdrawn, indicating $1.44 billion still parked in T-bills.

With regards to PIBs, the total foreign inflow from July 2019 to date has been recorded at $60.5 million, out of which $45.42 million has been extracted so far.

This suggests that since July, cumulatively foreigners invested $3.49 billion in Government Securities (T-bills and PIBs) out of which $2.03 billion has been withdrawn, bringing the total net inflows to settle at $1.46 billion.

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Profit repatrition during February falls by 75 percent, MoM

March 30, 2020 (MLN): Profits and dividends repatriated by Pakistani sectors during February 2020 stood at $27.3 million, showing a decrease of 75% as compared to the previous month and 64% as compared to the same period of last year.  

During the period Jul-Feb FY2020, the profit repatriation declined by merely 2.1% to $973.9 million over the same period of last year.

According to the latest data released by the State Bank of Pakistan (SBP), the Oil and Gas exploration sector made the highest repatriation of profits during the period at $20 million, owing to a rise in oil prices in the international markets. However, this amount was 68% lower against the profits repatriated in the previous month and 44% against profits repatriated in the same period of last year.

The profits repatriated by the remaining sectors were meager against that of the leading sector. The Power Sector hardly took the second lead, as it managed to repatriate only 3.4 million, which is surprisingly elevenfold greater as compared to the previous month and 44% as compared to the same period of last year.  

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24-Karat gold plummets by Rs 4,400 to Rs 96,600...

March 30, 2020 (MLN): The price of 24 Karat-Gold plunged up by Rs 4,400 to close at Rs 96,600 per tola due to a decrease in demand for safe-haven metals in local markets. The precious yellow metal of 24-Karat had closed at Rs 101,100 per tola in the previous session.

According to the Karachi Sarafa Association, the silver prices edged higher by Rs 14.30 to peg at Rs 950 per tola as compared to Rs 935.7 during the last trading day.

In the global markets, the price of per ounce gold was traded at $1,620.

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CDWP clears 6 projects of over Rs 133.466 bn

March 30, 2020: The Central Development Working Party (CDWP) Monday approved two projects worth Rs 466.264 million and recommended four projects valuing Rs 133 billion to Executive Committee of National Economic Council (ECNEC) for consideration.

Secretary Planning Zafar Hasan, senior officials from federal and provincial governments also participated in the meeting while representatives from provincial governments participated through videoconference.

Projects related to Health, Physical Planning and Housing, Transport and Communication and Water Resources were considered during the meeting.

Health-related project from Government of Punjab namely ‘Punjab Human Capital Investment project” worth Rs. 52.8 billion was referred to the Executive Committee of the National Economic Council (ECNEC).

The project envisages increasing the access to quality health, education and social protection services among poor and vulnerable households in 11 districts of Punjab.

In the physical planning and housing sector, the CDWP approved construction of Admin Block, Magazine Quarter Guard, Barracks, MT Shed, Horse Stable and Parade Ground in Diplomatic Enclave, Islamabad worth Rs 280 million.

The Committee also cleared Position Paper titled “Construction of 4 Nos, B type Police Station in Various Sector of Islamabad” worth Rs 185.416 million.

Two Position papers related to Transport and Communications were presented namely “Peshawar Northern Bypass” worth Rs 21.338 billion and “Up-gradation, widening and construction of Surab- Hoshab Road N-85 (454 km)” worth Rs 28.823 billion both were referred to ECNEC for further approval.

The project “Khyber Pakhtunkhwa Irrigated Agriculture Improvement Project” worth Rs 30048.747 million was also referred to ECNEC for further approval.



Closing Bell: Calming the storm!

March 30, 2020 (MLN): The stock markets remained somewhat volatile throughout the day, with the KSE-100 trading beneath 28,000-mark for the majority of the session. However, the benchmark index quickly gained momentum in the second half as it ended the session with a loss of just 86 points and closed at 28,083-level.


The Index remained negative throughout the session touching an intraday low of 27,461.59

Of the 93 traded companies in the KSE100 Index 42 closed up 48 closed down, while 3 remained unchanged. Total volume traded for the index was 127.65 million shares.

Sector wise, the index was let down by Oil & Gas Exploration Companies with 133 points, Commercial Banks with 95 points, Tobacco with 19 points, Miscellaneous with 12 points and Automobile Assembler with 7 points.

The most points taken off the index was by PPL which stripped the index of 73 points followed by OGDC with 46 points, ENGRO with 35 points, UBL with 20 points and PAKT with 19 points.

Sectors propping up the index were Cement with 136 points, Power Generation & Distribution with 47 points, Pharmaceuticals with 12 points, Engineering with 8 points and Technology & Communication with 5 points.

The most points added to the index was by LUCK which contributed 65 points followed by FFC with 38 points, HUBC with 32 points, DGKC with 18 points and FCCL with 17 points.

All Share Volume decreased by 9.97 Million to 159.47 Million Shares. Market Cap decreased by Rs.43.47 Billion.

Total companies traded were 328 compared to 304 from the previous session. Of the scrips traded 166 closed up, 145 closed down while 17 remained unchanged.

Total trades increased by 7,206 to 61,135.

Value Traded decreased by 0.01 Billion to Rs.4.23 Billion


Top Ten by Volume

Maple Leaf Cement Factory9,571,500
Hascol Petroleum7,167,000
Unity Foods6,862,500
Summit Bank6,211,000
The Bank of Punjab6,056,500
Oil & Gas Development Company5,706,492
TRG Pakistan5,562,500
D.G. Khan Cement Company4,506,500
Fauji Cement Company4,386,500



Top Sector by Volume

Power Generation & Distribution40,974,045
Commercial Banks17,978,219
Oil & Gas Exploration Companies10,258,663
Oil & Gas Marketing Companies9,889,616
Technology & Communication9,509,300
Vanaspati & Allied Industries6,862,500
Food & Personal Care Products6,251,440



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ADB approves $2 million grant for Pakistan’s fight against...

Mar 30, 2020: The Asian Development Bank (ADB) Monday approved a further $2 million grant to support the government of Pakistan’s efforts to combat the coronavirus (COVID-19) pandemic in the country.

The grant, financed from the Asia Pacific Disaster Response Fund, will help fund the immediate purchase of emergency medical supplies, personal protective equipment, diagnostic and laboratory supplies, and other equipment.

It supplements an initial $500,000 approved by ADB on 20th March which is already being deployed to support Pakistan’s procurement of emergency supplies through UNICEF.

Taken together, this $2.5 million in approved funding represents ADB’s immediate response for Pakistan, with further support to follow, an ADB press release said.

“ADB recognizes the extraordinary burden of this pandemic on Pakistan and is committed to supporting Pakistan in the fight to control COVID-19”, said ADB Country Director for Pakistan Xiaohong Yang. “This grant will help strengthen COVID-19 detection, improve infection prevention and control, and boost Pakistan’s capacity to respond to the pandemic.”

ADB’s assistance echoes the World Health Organization’s Strategic Preparedness and Response Plan for COVID-19 and Pakistan’s National Action Plan for Corona Virus Disease (COVID-19), which includes preventive measures, containment efforts, and treatment of infected persons. Given the urgency of the required support, ADB will use the most flexible and expeditious approaches to facilitate procurement of the required medical supplies and equipment.

On 18th March, ADB announced an initial package of approximately $6.5 billion to address the immediate needs of its developing member countries as they respond to the COVID-19 pandemic. ADB stands ready to provide further financial assistance and policy advice down the road whenever the situation warrants. Visit ADB’s website to learn more about our ongoing response.

The statement added that the ADB was committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.


Stocks, oil prices slide on shattered demand

March 30, 2020 (MLN): World stock markets mostly tumbled and oil prices plunged Monday despite fresh Chinese and Australian stimulus to shore up an economy shattered by the coronavirus fallout.

                  Australia was out on its own -- its stock market surging 7.0 percent as the country's virus infections slowed, while after the close of trade in Sydney the government unveiled an income-support plan worth US$80 billion.

                  Crude oil meanwhile struck the lowest levels in more than 17 years on Monday, with Brent North Sea tumbling to $22.58 per barrel at one point.

                  "Estimates for the (oil) demand side are being revised downwards on an almost daily basis, while on the supply side there is still no sign of any reconciliation between Saudi Arabia and Russia" regarding their price war, Commerzbank said in a client note.

                  There are warnings that oil could sink even further as storage tanks around the world approach full capacity.

                  Elsewhere Monday, the dollar climbed across the board, while Asian stock markets mostly fell following Friday's steep drop on Wall Street and Europe.

                  Jubilation over last week's enormous US stimulus package has largely faded, with investors returning their attention to the soaring infection and death rate figures of the coronavirus.

                  US President Donald Trump on Friday signed off Washington's stimulus measures worth more than $2 trillion.

                  While the disease ravages populations and the global economy grinds to a halt with 40 percent of the planet in lockdown, experts are struggling to get a grip on the scale of the crisis that is forecast to cause a worldwide recession.

                  Analysts say there are likely more dark days ahead, with Trump abandoning his timetable for life returning to normal in the United States and extending emergency restrictions for another month.

                  The president said he expected the country to "be well on our way to recovery" by June 1 -- dropping his previous target of mid-April.

                  Meanwhile, senior US scientist Anthony Fauci issued a tentative prediction that COVID-19 could claim up to 200,000 lives in the US.

                  Governments and central banks have acted to shore up the global economy, pledging around $5 trillion in stimulus support, with China on Monday joining the party by lowering bank borrowing costs and pumping billions of dollars into financial markets, while Singapore also eased rates.

                  AxiCorp's Stephen Innes said markets looked like they were "nearing policy fatigue where it becomes less effective, and as the surprise element diminishes, no one cares".

                  "So, while policy responses in the US and Europe have been spectacular... the coronavirus keeps spreading globally, deepening fears of the economic and financial impact across countries. More market turmoil likely lies ahead."

                  He also pointed out that with the corporate reporting season approaching "now we are about to enter a vortex of bad earnings, bad economic data, and bankruptcies".

                  Measures to contain the coronavirus outbreak will slash the German 2020 economic output before a rebound next year, a panel of economists who advise the government said Monday.

                  "The big question for markets is whether the huge stimulus introduced so far across the globe will be enough to help the global economy withstand the economic shock from the COVID-19 containment measures," said National Australia Bank's Rodrigo Catril.

                  "To answer this question one needs to know the magnitude of the containment measures and for how long they will be implemented. This is the big unknown and it suggests markets are likely to remain volatile until this uncertainty is resolved."




PMEX Commodity Index slides by 38 pts to 3,539-mark

March 30, 2020: On Friday at Pakistan Mercantile Exchange Limited, PMEX Commodity Index lost 38 points and closed at 3,539. The traded value of Metals, Energy and COTS/FX was recorded at PKR 5.225 billion and the number of lots traded was 9,443.

The major business was contributed by Gold amounting to PKR 1.678 billion, followed by DJ (PKR 1.059 billion), Currencies through COTS (PKR 873.067 million), NSDQ 100 (PKR 643.851 million), Crude Oil (PKR 538.349 million), Silver (PKR 186.959 million), SP500 (PKR 89.380 million), Platinum (PKR 66.430 million), Brent Crude Oil (PKR 46.124 million), Natural Gas (PKR 25.616 million), Japan Equity (PKR 9.468 million) and Copper (PKR 7.918 million).

In agriculture commodities, one lot of Soybean amounting to PKR 7.292 million, one lot Wheat amounting to PKR 4.742 million and 6 lots of Cotton amounting to PKR 2.579 million were traded.

Press Release

PKR trades 60 paisa lower against USD

March 30, 2020 (MLN): Pakistani rupee (PKR) depreciated by 60 paisa against US Dollar (USD) in today's interbank session as the currency closed the day's trade at PKR 166.14 per USD, against last session's closing of PKR 165.54 per USD.

The rupee endured a volatile trading session with quotes being recorded in a range of 2.00 rupees per USD showing an intraday high bid of 166.50 and an intraday Low offer of 165.75.

Within the Open Market, PKR was traded at 164/167 per USD.

Meanwhile, the currency lost 3.6 rupees to the Pound Sterling as the day's closing quote stood at PKR 205.77 per GBP, while the previous session closed at PKR 202.18 per GBP.

Similarly, PKR's value weakened by 1.5 rupees against EUR which closed at PKR 184.24 at the interbank today.

On another note, within the money market, the overnight repo rate towards the close of the session was 11.00/11.20 percent, whereas the 1-week rate was 11.00/11.05 percent.

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