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The weekly roundup of Pakistan’s economy

During the outgoing week, benchmark index witnessed volatile trading, the index lost 45 points and settled at 37,292 index level. The week started on a positive note with news that Pakistan is close to finalizing the bailout package after meetings with IMF held in Washington.

However, news that SBP is considering a proposal for implementation of Treasury Single Account (TSA) dragged down banks by midweek. After that, on Thursday, Finance Minister’s sudden resignation from his post further added to the volatility, as market took it positive. Additionally, clarification regarding single treasury account by SBP further lifted the index up.

In addition, the other major business and economic developments that took place during the departed week include:

On Thursday, Finance Minister Asad Umar stepped down from his position at the Ministry of Finance after Prime Minister Imran Khan carried out a cabinet reshuffle.

Hours after Asad Umar announced his decision to quit as finance minister, Prime Minister made major changes in his cabinet with a few big shots removed from key positions and newcomers taking over important portfolios. PM Office not only declared appointment of Dr Abdul Hafeez Sheikh as the adviser to the PM on finance, but also announced changes in the portfolios of several other key cabinet members, including Federal Minister for Information.

On Friday, during a media talk in Islamabad, Advisor on Finance, Dr. Hafeez Shaikh said that the Budget will be presented on May 24, as originally planned.

Meanwhile, Advisor to the Prime Minister on Commerce, Textile, Industries and Production, Razzak Dawood on Friday said that negotiations for Free Trade Agreement with China have been completed and agreement would be signed on 28th of this month.

On Wednesday, The State Bank of Pakistan conducted an auction in which it sold Pakistan Investment bonds worth Rs.227.98 Billion for 3 Years (Fixed Rate) and 10 Years (Floating Rate). In the fixed rate auction, the SBP picked up Rs.162.664 Billion for 3 years at a cut-off yield of 12.20 percent, while the bids for 5 and 10-year PIB’s were rejected.

The State Bank of Pakistan on Wednesday issued a clarification regarding news circulating on social media regarding the Government’s plan to introduce Treasury Single Account (TSA) in which it clarified that no decision has yet been made to implement the TSA.

Moreover, the federal cabinet failed to develop a consensus on the Tax Amnesty Scheme in its second meeting on Wednesday with Prime Minister Imran Khan in the chair and asked more time to formulate laws pertaining to new tax amnesty scheme.

On Tuesday, Minister for Finance Asad Umar Monday said Pakistan and International Monetary Fund (IMF) have reached a consensus on all outstanding issues to finalize the bailout package. The loan package from the IMF could be $6-8 billion,” said the finance minister talking to media after attending National Assembly’s standing committee on finance and revenue.

The statistical data released this week apprising the economic standing of the country are listed below:

  • The weekly Sensitive Price Index (SPI) for the combined group Inched up by 0.39% during the week ended April 18, 2019, whereas SPI compared to the same period last year has marked a rise of 12.42%.
  • Pakistan’s forex reserves decreased by US$ 1,032.40 million as the total liquid foreign reserves held by the country stood at US$16,195.90 million on April 12, 2019.
  • As of April 5, 2019, the government sector of Pakistan borrowed a net sum of Rs.708 billion from various sources during the ongoing fiscal year.
  • Credit given to the Non-government sector during the current fiscal year has reached Rs.881.98 billion as of April 5, 2019, i.e. around 44.6 percent higher than the same period last year.
  • The over-all output of Large-Scale Manufacturing Industries (LSMI) during the month of February 2019 decreased by 1.49% as compared to February 2018, and 5.11% as compared to January 2019.
  • Exports from Pakistan during March 2019 were recorded at $1,979 million (provisional) as compared to $1,889 million (provisional) in February 2019 showing an increase of 4.76% but decreased by 11.13% as compared to $2,227 million in March 2018.
  • Foreign Direct investment (FDI) plunged by 51.4% to $1.273 billion during July to March FY19 period.
  • Pakistan has recorded a surplus of $79.26 million in trade of food products for March 2019 as export worth $472.08 million was reported against imports worth $392.8 million.
  • Pakistan’s outstanding debts at the end of March 2019 stand at a massive sum of Rs.18.67 trillion which means around Rs.1.46 trillion were cumulatively accumulated during the nine months (July 2018 – March 2019) of ongoing fiscal year (FY19). 
  • Current account deficit (CAD) in first nine months (July to March) FY19 has fallen by 29% to $9.588 billion compared to $13.589 billion in same period last year.
  • The imports in March 2019 stood at $4,155 million (provisional) as compared to $4,180 million (provisional) in February 2019, showing a decrease of 0.60 %.

 

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Posted on: 2019-04-21T13:55:00+05:00

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