Category: Business

As of October 2024, the cement rate today in Pakistan has maintained its ever-constant variations owing to supply chain disruptions and high raw material costs. A 50-kg cement bag retails for an average price of between PKR 1,100 and PKR 1,400, subject to the area and brand. The prices are expected to be higher in urban centers like Karachi, Lahore, and Islamabad because of the sprawling demand and transport rates.

Also, most current flat cement rates in Pakistan are boosted by a surge in construction activity, with much more infrastructure and housing construction. The growing markets for this construction can be attributed to more price-distorted projects, namely government construction projects and the growth of the private housing market. To make matters worse, the expensive oil and inflation experienced by the economy have equally pushed the prices of cement production higher, making its selling prices rise in recent months.

The industry predicts prices will rise in the upcoming years unless supply chains are improved or input costs are decreased. Pakistani cement companies work to meet the country’s economic challenges and current demand. Cement consumption in Pakistan has surged economically. But its cheap rate helps complete construction projects without breaking the budget.

Here is the list of the latest 53 Grade cement prices of different cement-producing companies in Pakistan.

Serial No	Brands	Price per 50kg bag
1	Flaying Pakistan Rate	RS. 1,445-1,455
2	Cherat Cement Rate	RS. 1,460-1,470
3	Power Cement Rate	RS. 1,460-1,470
4	Paidar Cement Rate	RS. 1,460-1,470
5	Falcon Cement Rate	RS. 1,460-1,470
6	Kohat Cement Rate	RS. 1,465-1,475
7	Lucky Cement Rate	RS. 1,465-1,475
8	Askari Cement Rate	RS. 1,465-1,475
9	BestWay Cement Rate	RS. 1,475-1,485
10	Maple Leaf Cement Rate	RS. 1,475-1,485

Here is the list of the white cement prices of different cement-producing companies in Pakistan.

Serial No	Brands	Price per 50kg bag
1	Maple Leaf White Cement	RS. 2150-2250
2	Kohat White	RS. 2050-2100

Pakistan is losing out on approximately $21 billion annually to tax evasion. As Finance Minister Muhammad Aurangzeb tightens the metaphorical noose around tax evaders with his crusade, law-abiding citizens could expect better times.

This is because, as per the latest federal budget, the interest payments of the debt incurred to finance the fiscal deficit of $30.6 billion will be financed using taxpayer funds. However, if Aurangzeb successfully expands the tax net, this fiscal deficit will fall massively to just a mere $9.6 billion.

Simply put, there are two ways to narrow a fiscal deficit: either the government can cut down on expenditures, or tax collections can be increased. In a bid to reduce the deficit, the finance minister plans to hold corrupt FBR officials accountable. This is to be done by implementing strict punishments: 10-year prison sentences and hefty fines. And with FBR agents raiding non-taxpaying businesses, the government budget deficit is likely to see a turn for the better.

The primary culprits of tax evasion are big companies that are responsible for 50 per cent of all unpaid taxes, a figure that translates into an annual loss of PKR 3.4 trillion in revenue for the FBR. With Aurangzeb taking strict action against corporate tax fraud, it is only a matter of time before every non-compliant business is paying its fair tax rate of 29%.

The motivation behind people skipping out on paying taxes stems from an economic concept known as the “free rider effect”. In simple words, people who don’t pay taxes have just as much a right to enjoy security from the police or acquire free healthcare at a public hospital as opposed to people who do pay their taxes.

Is this morally right? Perhaps not. However, compliance with tax legislation does not seem attractive—not when selling morality can net non-taxpayers $21 billion per annum by withholding taxes.

Regardless of morality, though, tax evasion is a crime, and Aurangzeb is not playing softball with people who cross him.

The World Bank has projected that Pakistan’s economic activity will keep getting better with GDP growth to hit 2.8 per cent in FY25, slightly up from the previous projection of 2.3 per cent.

These insights were mentioned in a report named Pakistan Development Update: The Dynamics of Power Sector Distribution Reforms.

The report mentions several positive factors for Pakistan’s economy, including the removal of import restrictions, easing of domestic supply chain disruptions, and falling inflation ratings.

Also, business confidence is likely to improve with upgrades in Pakistan’s credit rating and lesser political uncertainty.

Pakistan’s agriculture sector is also projected to grow at average rate of 2.4 per cent during FY25–26. The World Bank said that the absence of import controls will enhance the availability of farm inputs, which will support recovery in agricultural sector over the medium term.

The report also predicts that growth in agriculture and industry will benefit the services sector, which is projected to grow by an average of 3.2 per cent during FY25–26.

This growth will be led by key sub-sectors including wholesale and retail trade, along wit transport and storage, which are expected to recover with the revival of imports and surging demand.

Output growth is forecasted to drop to 3.2 per cent in FY26 due to stricter macroeconomic policies, high inflation, and lingering policy uncertainties.

On the inflation front, the World Bank expects consumer price inflation around 11.1 per cent in FY25, slowing further to 9 per cent in FY26, driven by lower commodity prices, tight macroeconomic policies, and high base effects.

Still, inflation is expected to remain high in the short term due to increasing energy prices, an increase in money supply through open market operations (OMOs), and new tax measures as a part of ongoing fiscal consolidation efforts.

Externally, Pakistan’s current account deficit is also expected to remain low at 0.6 per cent of GDP in FY25, inching up slightly to 0.7 per cent in FY26, as local demand improves and import restrictions remain lifted.

Pakistan’s foreign currency reserves have risen to $15.98 billion, of which $5.28 billion are held by commercial banks and $10.7 billion by the State Bank of Pakistan (SBP). This is the highest level of reserves in 30 months achieved via the inflow of the IMF loan: A sign of short-term stability.

Pakistan’s economic woes seem to be coming to a close with the upcoming Shanghai Cooperation Organization (SCO) summit in Islamabad, which begins October 16-17.

Foreign investments, including possible multi-billion dollar settlements from Saudi Arabia in the Reko Diq mining operation and loans for the ML-1 railway project, are expected to come to Pakistan. These funds are expected to immediately give relief to the economy but will also alter the value of the PKR.

It is possible that the foreign investment funds will increase the value of the PKR. This happens because when foreign funds arrive, they have to be converted into PKR before they are to be invested in local projects. As a result, the demand for PKR shoots up and the value of the PKR goes up. However, this appreciation is usually short-lived. Once the foreign funded projects are completed, the PKR tends to lose value again.

This historical pattern is linked to Pakistan’s huge trade deficit, which was $24.09 billion for just the fiscal year 2023-24 alone. This is due to Pakistan importing much more than it exports.

The imports that exceed exports are responsible for the outflow of foreign reserves which causes the PKR to depreciate.

Historically, to prevent the PKR from depreciating too much, the SBP has come in and started selling off foreign currency reserves to support the value of the PKR when it starts to depreciate. However, the sale of reserves is not a viable option to stabilize the PKR value in the long term as Pakistan runs a persistent trade deficit.

The more PKR the SBP buys, to artificially increase the value of the PKR, the more it depletes its reserves. Without any rise in the inflow of foreign currency from exports, this practice of artificially propping up the PKR is not sustainable.

The recent rise in reserves and the temporary boost from the SCO summit may give a sense of stability, but they don’t address the core underlying economic problems. Structural changes in exports and imports will help the rupee to remain under pressure unless the trade deficit is curbed.

While the SBP interventions may provide immediate relief, they only treat the symptoms, not the cause. To achieve true economic stability, the government needs to enforce reforms. Reducing the trade deficit by increasing exports to build sustainable foreign reserves is the need of the hour for Pakistan.

While the 30 month foreign reserves high is a reprieve for the state bank, it’s just that: A reprieve. The real question, though, is whether Pakistan will be able to grow when world leaders leave Islamabad after the conclusion of the SCO.