The seventh and eighth reviews of Pakistan’s bailout programme were approved by the International Monetary Fund (IMF) board on Monday, releasing $1.17 billion to the cash-strapped nation.
Pakistan is now set to get a $1.17 billion loan tranche from the international lender within the next six days.
Alhamdolillah the IMF Board has approved the revival of our EFF program. We should now be getting the 7th & 8th tranche of $1.17 billion. I want to thank the Prime Minister @CMShehbaz for taking so many tough decisions and saving Pakistan from default. I congratulate the nation.
“Alhamdolillah, the IMF board has approved the revival of our EFF programme. We should now be getting the seventh and eighth tranche of $1.17 billion,” said Finance Minister Miftah Ismail in a tweet announcing the news.
Additionally, the Finance Minister praised the Prime Minister, Shehbaz Sharif, “for taking so many tough decisions and saving Pakistan from default.”
The previous payment was made to Pakistan in February, and the subsequent tranche was scheduled to be released following a review in March.
However, the PTI government drastically reduced petroleum prices by providing substantial subsidies to the country, which caused the program’s fiscal objectives to be missed.
The State Bank of Pakistan (SBP) has imposed import restrictions that have negatively impacted the clearance of import consignments, which has in turn affected the inventory levels, according to Pak Suzuki Motor Company (PSMC), which announced on Monday that the shutdown of its auto production plant has been further extended from August 29 to August 31.
The SBP has instituted a procedure for prior permission for imports within the HS code 8703 category (including CKDs), according to a notice given to the Pakistan Stock Exchange (PSX) by PSMC on May 20, 2022, according to pkrevenue.
According to PSMC, these restrictions had a negative influence on the import consignment’s clearance, which in turn had an impact on inventory levels.
PSMC said that it is experiencing a scarcity of inventory. As a result, the company’s management has decided to further extend the auto plant’s shutdown time from August 29, 2022, to August 31, 2022.
As a result of a decline in inventory levels, PSMC informed the PSX earlier this week that it will halt production of automobiles from August 22 through August 26, 2022.
However, PSMC stated on both occasions that its motorcycle plant will continue to operate.
Due to Pakistan’s auto industry’s reliance on imports and the SBP’s limits on Letters of Credit opening as a result of the persistent rupee devaluation, the country is currently experiencing an exchange rate crisis.
In order to prevent delays in car delivery and future price increases, the manufacturers requested the central bank’s involvement back in July for opening LCs for the import of CKD kits.
PSMC stated earlier this month that it would lower the pricing of its cars by between Rs75,000 and Rs199,000, citing the strengthening of the rupee versus the US currency. Due to the weakening of the rupee, prices had already climbed significantly in early August.
The International Monetary Fund (IMF) executive board will meet on Monday (today) to discuss the bailout plan for Pakistan.
The 8th and 9th tranches, totaling over $1.2 billion, are anticipated to be disbursed with board approval.
According to Geo, Pakistan also requested that the Extended Fund Facility (EFF) be increased from $6 billion to $7 billion and that the term be extended from September 2022 to June 2023.
If the contract is approved by the board, the IMF will give Pakistan an initial payment of roughly $1.2 billion and could give up to $4 billion during the remaining months of the current fiscal year, which started on July 1.
The board gave its approval for the transfer of $1.386 billion to Pakistan under the RFI in April 2020 to help with the economic effects of the Covid-19 shock.
Additionally, according to The Wall Street Journal, Pakistan has secured at least $37 billion in foreign loans and investments in recent weeks, saving it from a financial catastrophe similar to that of Sri Lanka.
The restart of the programme will greatly benefit the government led by Prime Minister Shehbaz Sharif as it will assist prevent what would be the second default in Asia this year after Sri Lanka.
Bloomberg estimates that Pakistan would have to pay at least $3 billion in debt payment during the first half of the fiscal year 2023.
The State Bank of Pakistan anticipates that foreign exchange reserves would increase to around $16 billion this fiscal year from $7.8 billion, thanks to the IMF loan opening the door for additional funding.
In order to ensure the prompt resolution of all disciplinary cases and inquiries against tax employees engaged in corruption and dishonest activities in field formations, the Federal Board of Revenue (FBR) established a new Section on Friday called “Discipline/Inquiries.”
A new Section with the nomenclature “Discipline/Inquiries” is hereby created in the Admn/HR Wing, FBR (HQ), Islamabad with immediate effect in order to ensure proper follow-up of all disciplinary cases/inquiries of officers (BS-16 and above) of FBR (HQ) and IR field formations with a view to ensuring timely disposal of such cases, according to an office order issued by the FBR on Friday.
According to Brecoder, a secretary or second secretary who works for the specified Section will be in charge and reporting to the Chief (HRM-IR), FBR.
The FBR has also been ordered by Prime Minister Shehbaz Sharif to fully abide by the guidelines of the Civil Servants (Efficiency and Discipline) Rules, 2020 when taking disciplinary action and conducting investigations against dishonest tax officers.
The FBR chairman has directed the Revenue Division/FBR to rigorously adhere to the following instructions in all disciplinary processes and inquiries launched against the officers, in accordance with the directives of the prime minister:
The Civil Servants (Efficiency & Discipline) Rules, 2020, Rule 10 read with Rule 12 shall govern how the chosen inquiry officer would conduct the inquiry processes. The same must be finished within sixty (60) days of the date the inquiry order was issued, or within any further time the authority may provide.
All Directors General, Chief Commissioners, Chief Collectors, Commissioners, and Collectors of FBR shall keep the relevant case record in safe custody while forwarding the recommendation to begin disciplinary proceedings against any officer(s) or official in order to ensure safe custody of the record in an inquiry.
In accordance with the guidelines outlined in Rule 8 of the Civil Servants (Efficiency and Discipline) Rules, 2020, all heads of field offices shall also see to it that pertinent records of the case and other related documents are timely provided to the inquiry officer or the inquiry committee, as the case may be, through the designated departmental representative (DR). This must be done within seven days of the date of the inquiry order.
After Finance Minister Miftah Ismail accused the KP government of plotting to derail the IMF deal in a late-night press conference, KP Finance Minister Taimur Khan Jhagra stated that the province is currently dealing with a flood scenario that takes precedence over everything else.
In a previous letter to Miftah, Jhagra connected the payment of the Rs100 billion in alleged liabilities with the clearance of the provincial cash surplus for this fiscal year, which is a requirement of Pakistan’s agreement with the International Monetary Fund (IMF).
This occurs just three days prior to the revival of IMF’s multibillion dollar credit programme. The K-P government has already agreed through a memorandum of understanding (MoU) to achieve the Rs117 billion cash surplus that is required by the IMF arrangement. Ismail is a co-signatory of the Letter of Intent (LoI) that was recently sent to the IMF in order to revive the programme.
“Please note that in these conditions [floods], and without the resolution of the issues highlighted previously, for the province of Khyber Pakhtunkhwa to actually leave a surplus will be next to impossible,” Jhagra wrote in the communique sent to Miftah on Friday.
Miftah Ismail’s call, according to Jhagra, was “interesting,” and the two will now meet on Monday to resolve their issues. However, the provincial finance minister stated it was “sad” that in Pakistan, one needed to “shout to be heard.”
1. This imported govt doesn't need enemies. Their own party hierarchy & their chamchas in the press are enough to sabotage their own… Why would the KP govt or I write to the IMF? Please read the letter I wrote to the Federal Finance Minister for yourself. pic.twitter.com/NTaPGoniym
Jhagra confirmed in a series of tweets that he had actually addressed a letter to the federal finance minister and not the IMF. The provincial minister sent a letter that included images as well.
1. This imported govt doesn't need enemies. Their own party hierarchy & their chamchas in the press are enough to sabotage their own… Why would the KP govt or I write to the IMF? Please read the letter I wrote to the Federal Finance Minister for yourself. pic.twitter.com/NTaPGoniym
Jhagra went on to say that despite raising the same issues with Miftah at their meeting on July 5, they decided to return the IMF MoU to Islamabad within 24 hours with the approval of the chief minister of KP.
2. Note that when I last got time from the fed finance minister on July 5, I raised the same concerns; on the FATA budget; on NHP; but because it was in the national interest, returned the IMF MoU to Islamabad within 24 hours. Personally ensured that with the approval of the CM.
3. Here is my original letter on July 5 accompanying the signing of the IMF MOU. The follow up letter that I sent today was simply in continuation, after about 50 days of repeated attempts to resolve our financial issues fairly and obtain a meeting quickly. pic.twitter.com/3DoOMNGoVR
Jhagra added that the KP administration would never back down from advocating for a strong federation or from bringing up its concerns at the centre.
4. The KP govt will never back down from raising its issues at the centre, or from working for a strong federation. But here are a few chamchas who must have caused alarm at the IMF. I wonder if PEMRA will be in action now? pic.twitter.com/D4igUR5wkU
At a late-night press conference, Miftah called the letter “deplorable.” He labelled the letter as a “conspiracy to derail the IMF programme and sink the rupee.”
He questioned whether PTI Chairman Imran Khan, who was seeking to obliterate Pakistan and its economy out of a desire for power, had any set parameters.
The staff of power distribution companies (DISCOs) must work nonstop to correct the electricity bills of consumers using less than 200 units per month, following a directive from Prime Minister (PM) Shehbaz Sharif.
He gave the order for all staff members’ leaves to be ended, the bills should be corrected right away, and a report should be given to him. In order to deposit electricity bills in the upcoming days, he continued, the banks should be instructed to stay open.
PM Shehbaz gave the orders while presiding over a high-level meeting to address the issues facing electricity consumers.
Furthermore, a high-level committee was formed by the prime minister to address the issues of power users.
The gathering was informed that efforts are being made to ensure the adoption of the relief package for power consumers that the prime minister had announced. According to him, bill adjustments are being made as part of the relief for 16.6 million consumers related to the change in fuel prices.
The relief measures must be put into effect right away, according to directives issued by the prime minister.
The bike taxi and logistics company BYKEA has recently launched its car-hailing service. The service has only been made available by Bykea in Karachi and Islamabad so far, but it will likely be expanded in the coming months.
The launch of the new service was confirmed by the company through a social media post. “Hum ho gaye hain 2 se 4,” tweeted BYKEA’s official account.
Earlier this month, the company hinted that it will start offering a car-hailing service. However, it did not publicly announce its plans or inform its regular users. A tweet from its official account suggested that the company is launching a car-hailing service.
Mian Muhammad Aslam Iqbal, Punjab’s Minister for Housing and Urban Development, approved the launch of three low-cost housing societies on Thursday.
This was announced at the 86th meeting of the Punjab Housing and Town Planning Agency (PHATA) board, which was presided over by the Housing Minister, at the agency’s office.
These housing schemes will offer locals access to high-quality, low-cost homes:
Al-Rasheed Garden, Gujranwala
Al-Noor Garden Residencia, Sangla Hill
Campbellpur Greens, Attock
According to The News, a monitoring committee was also formed to oversee the housing developments. The delegates also agreed on the development of pension laws for PHATA workers, as well as other administrative issues.
Furthermore, in each of the housing complexes, a 20 per cent quota was set aside for the Naya Pakistan Housing Program (NPHP).
The Minister stressed the need of assisting developers in order to promote a smooth working environment and stated that corruption or dishonesty will not be allowed in his team.
He went on to say that the NPHP is a key priority for the province administration and that it intends to finish as many housing schemes as feasible in the shortest amount of time.
Earlier this month, the Housing Minister stated his aim to accelerate the creation of low-cost housing projects, saying, “Low-cost housing schemes should be finished quickly by working day and night.”
He also stated that a special cell will be established to encourage foreign Pakistanis to engage in the housing business.
Pak Suzuki Motor Company Ltd. (PSMC) reported its half-yearly results, which were completed on June 30, 2022. The company reported a net loss of Rs17.23 million against a net profit of Rs1.19 billion, according to the automaker’s latest filing on the Pakistan Stock Exchange (PSX).
According to Mettis Global, the company’s sales revenue climbed 30 per cent YoY, from Rs66 billion to Rs112, 62 billion, mostly due to volumetric growth and pricing increases.
As a result of growing input costs and the significant depreciation of the local currency, the gross margins during 1HFY22 decreased from 5.98 per cent to 3.74 per cent.
Regarding the company’s primary expense heads, distribution and marketing costs came in at Rs1.64 billion, up 30 per cent YoY, while administration costs dipped to Rs1.48 billion, up 11 per cent YoY.
In contrast to Rs866 millionn in 1HFY21, the company additionally received Rs1.56 billion in other income.
Furthermore, as a result of rising interest rates, finance costs increased by 6.2x YoY, from Rs292 million to Rs1.8 billion.
The company also paid Rs767.84 million in taxes, which represents an increase of 57 per cent YoY because of the impact of super taxes.
Cloudways, a Pakistani company that offers small and medium-sized businesses cloud hosting and software as a service (SaaS) capabilities, will be acquired by New York Stock Exchange-listed company DigitalOcean Holdings for $350 million.
A large amount of the consideration, according to a business statement posted on Wednesday, would be paid over a 30-month period after the transaction closes in September.
According to DAWN, this will be one of the largest acquisitions in Pakistan’s history due to the hefty amount of the transaction. According to the company, this deal will make workflows simpler for small and medium-sized companies that are seeking less complicated ways to develop and grow their digital operations.
The projected revenue for Cloudways in fiscal 2022 is more than $52 million, which would indicate a three-year compound annual growth rate of more than 50 per cent.
Since 2014, DigitalOcean and Cloudways have been strong collaborators. About 50 per cent of Cloudways’ clients are currently powered by DigitalOcean infrastructure.
Serving a clientele that is both global and expanding, both companies will service more than 124,000 clients who make monthly payments of over $50, or around 84 per cent of the pro forma company’s total revenue.
For specific small and medium-sized enterprises wishing to outsource their on-ramp to the internet, Cloudways offers straightforward on-boarding and day-to-day management.
The company assists such organisations in offloading the challenges of cloud infrastructure so they may focus more on managing and growing their operations.
