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Category: Business

  • Gold price rebounds by Rs1,000 to Rs251,000 per tola

    Gold price rebounds by Rs1,000 to Rs251,000 per tola

    Gold prices in Pakistan saw an increase on Monday, with 24-karat gold being sold at Rs251,000 per tola, marking a rise of Rs1,000.

    According to the Karachi Sarafa Association, the price of 24-karat gold also increased by Rs857, reaching Rs215,192 per 10 grammes.

    The price of 22-karat gold followed suit, with a notable increase to Rs197,260 per 10 grammes.

    Conversely, silver prices in the domestic market remained unchanged. The price of 24-karat silver held steady at Rs2,920 per tola and Rs2,503 per 10 grammes.

    On the international front, spot gold traded near $2,407 an ounce, reflecting a decrease of $4.5, or 0.19 per cent, from the previous session.

  • K-Electric seeks NEPRA approval for Rs5.45 per unit tariff hike following petrol price surge

    K-Electric seeks NEPRA approval for Rs5.45 per unit tariff hike following petrol price surge

    Karachi’s power provider, K-Electric, has submitted a request to the National Electric Power Regulatory Authority (NEPRA) seeking approval for a Rs5.45 per unit increase in electricity tariffs under the Fuel Cost Adjustment (FCA) mechanism for May and June.

    If NEPRA approves this request, it will significantly intensify the financial burden on consumers already struggling with high inflation and declining incomes. Citing rising fuel costs, K-Electric has requested a tariff increase of Rs2.53 per unit for May and Rs2.92 per unit for June.

    This proposed hike, if sanctioned during NEPRA’s hearing on 30th July, would impose an additional Rs10 billion burden on consumers.

    This request follows the government’s recent decision to raise the base tariff for domestic consumers by up to Rs48.84 per unit, coupled with increases in the petroleum levy and new taxes on agricultural income.

    According to a Power Division notification, the hike in electricity prices will also affect Karachi consumers. However, those consuming up to 200 units per month will be exempt from the increase for three months.

    NEPRA recently approved the federal government’s application to raise electricity tariffs for domestic, commercial, general services, bulk, and agricultural consumers.

    On 5th July, NEPRA had sanctioned an Rs3.3287 per unit increase in electricity prices for May 2024 due to the monthly FCA, although this did not apply to K-Electric consumers.

    Additionally, the federal cabinet has approved increases in the base tariff by Rs8.04 for commercial consumers, Rs6.62 for agricultural consumers, Rs6.96 for general services, and Rs5.96 for bulk consumers.

    As a result, the base tariff has risen to Rs46.83 per unit for agricultural consumers and Rs61.03 per unit for general services. Bulk consumers will now pay Rs59.96 per unit following an increase of Rs5.51 per unit. The base tariff for industrial consumers remains unchanged.

  • Prime Minister directs swift implementation of China-Pakistan industrial agreements

    Prime Minister directs swift implementation of China-Pakistan industrial agreements

    Prime Minister Shehbaz Sharif received a detailed roadmap for the relocation of Chinese industries to Pakistan on Saturday.

    During a review meeting to assess the progress of Pakistan-China cooperation agreements following his visit to China, the Prime Minister was briefed on the planned collaboration with Chinese companies.

    This collaboration aims to transfer Chinese textile, medical and surgical equipment, and plastic and leather industries to Pakistan.

    It was noted that 78 Pakistani companies have initially expressed interest in this industrial transfer.

    Facilitating Chinese industry relocation

    The Board of Investment (BOI) presented a comprehensive report detailing the progress and action plan for this initiative. Prime Minister Sharif directed relevant institutions and officials to ensure all necessary facilities are provided to Pakistani companies collaborating with Chinese firms.

    He emphasised that any delays in implementing the memorandums of understanding with China would not be tolerated. The Prime Minister highlighted China’s steadfast support during challenging times and noted the Chinese leadership’s commitment to increasing investment in Pakistan.

    Sharif underscored that the relocation of Chinese industries to Pakistan would bolster the national economy, create new job opportunities, and enhance exports.

    During the meeting, the Prime Minister was also briefed on various projects. The Minister for Planning shared details of his recent visit to China. It was reported that the Sukkur-Hyderabad Motorway would be completed through a Public-Private Partnership.

    Additionally, a plan to send 1,000 students to China for modern agricultural vocational training at government expense has been finalised, with the first batch scheduled to depart at the start of the academic year.

    Subsequent batches will attend modern agricultural universities in China after completing Chinese language courses in Pakistan.

    The meeting was also informed about plans to convert power plants from imported coal to local coal. Moreover, a roadshow is being organised in Beijing to promote business and investment opportunities in Pakistan, in collaboration with Chinese partners.

  • Pakistan’s rice exports surge 74.8% to record $3.68 billion in FY24

    Pakistan’s rice exports surge 74.8% to record $3.68 billion in FY24

    Pakistan’s rice exports soared by 74.8 per cent year-on-year, reaching a record $3.68 billion in the fiscal year 2023-24, according to data from the State Bank of Pakistan (SBP) released on Friday.

    This significant increase was attributed to India’s stringent export restrictions during the same period.

    In comparison, Pakistan’s rice exports stood at $2.11 billion in the previous fiscal year, with an average of $2.31 billion annually over the past five years.

    India’s measures to curb rice exports in 2023, which continued into 2024 to stabilise domestic prices ahead of the general elections in April-May, played a crucial role in this surge.

    As a result of New Delhi’s export limitations, Pakistan emerged as the primary beneficiary, achieving record rice exports this year. Overall, Pakistan’s total goods exports for FY24 reached $31.09 billion, marking an 11.5 per cent increase from $27.88 billion in FY23.

    The food sector, notably rice, was the second-largest contributor to total exports, with the food group’s export value rising by 49.5 per cent year-on-year to $7.08 billion.

    India is now considering easing its export restrictions, which may include lowering the floor price for basmati rice exports and replacing the 20 per cent export tax on parboiled rice with a fixed duty, according to government sources cited by Reuters. This adjustment aims to help India maintain its market share against Pakistan.

    India initially banned non-basmati white rice exports in July 2023 due to concerns over reduced output from the El Niño weather pattern and imposed restrictions on other rice grades.

    “With rice supplies significantly exceeding local demand, it’s crucial to reduce stockpiles to prevent spoilage. The most effective solution is to lift export restrictions,” stated B.V. Krishna Rao, president of the Rice Exporters Association (REA).

    As of July 1, India’s rice stocks at state warehouses reached an all-time high of 48.51 million metric tons, nearly 19 per cent more than the previous year, according to the Food Corporation of India.

    Additionally, the Indian government is reviewing the export ban on non-basmati white rice after assessing the progress of rice planting, with farmers having planted 11.6 million hectares of rice paddy so far this season, up 20.7 per cent from the same period last year.

  • Gold price drops by Rs1,000 to Rs250,000 per tola

    Gold price drops by Rs1,000 to Rs250,000 per tola

    Gold prices in Pakistan experienced a decline for the second straight session on Saturday, mirroring the downward trend in international markets.

    In the local market, the price of gold per tola settled at Rs250,000, following a single-day drop of Rs1,000.

    According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of 10 grams of gold fell by Rs857, bringing it to Rs214,335.

    This decline follows a substantial decrease on Friday when the gold price per tola dropped by Rs3,000.

    On the international front, gold prices also saw a reduction on Saturday. The rate, as reported by the APGJSA, stood at $2,400 per ounce, inclusive of a $20 premium, after shedding $15 during the day.

    In contrast, silver prices showed an upward trend, increasing by Rs70 to reach Rs2,920 per tola.

    Earlier in the week, on Thursday, gold prices in Pakistan had surged by Rs4,600 per tola, reaching an all-time high of Rs254,000 per tola in the local market.

  • Pakistan working to secure foreign investment and extend existing loans: Finance Minister

    Pakistan working to secure foreign investment and extend existing loans: Finance Minister

    Pakistan is working to secure foreign investment and extend existing loans to meet its external financing needs, as it prepares to implement a new $7 billion deal with the International Monetary Fund (IMF). Finance Minister Muhammad Aurangzeb shared these plans with Reuters on Friday.

    The new 37-month IMF agreement requires Pakistan to enforce tough measures, including higher taxes on agriculture and increased electricity prices. These changes have raised concerns about their impact on the country’s poorer and middle-class citizens, who are already struggling with inflation.

    Historically, Pakistan has frequently relied on IMF programmes to avoid financial crises, sometimes coming close to default. The country has also depended on financial support from allies like the United Arab Emirates (UAE) and Saudi Arabia to meet its IMF targets.

    Aurangzeb highlighted that while external financing remains essential, the government is now focusing on sustainable solutions, such as attracting foreign direct investment and securing climate finance. “We expect loan rollovers to continue and have requested extensions for loan maturities,” he said.

    Past support from Saudi Arabia, the UAE, and China, along with IMF backing, has been crucial for Pakistan’s financial stability. The IMF has stated that the new Extended Fund Facility programme requires approval from its Executive Board and confirmation of necessary financing from Pakistan’s development and bilateral partners.

    Aurangzeb is optimistic about managing the external financing gap, describing it as “manageable and doable.” He emphasized a shift towards foreign direct investment, particularly in the Reko Diq copper and gold mine. The finance minister also noted that his government is working on projects to attract investment from Saudi Arabia and the UAE.

    Pakistan, currently the IMF’s fifth-largest debtor with $6.28 billion owed as of 11 July 2024, is also expecting a significant investment from the World Bank’s International Finance Corporation (IFC) in the Reko Diq project. Aurangzeb plans to discuss further reforms with China during a visit by the end of July.

  • Gold price falls by Rs3,000 per tola after hitting record high

    Gold price falls by Rs3,000 per tola after hitting record high

    The price of gold in Pakistan saw a decline on Friday after reaching a record high the previous day.

    The cost of 24-karat gold fell to Rs251,000 per tola, a decrease of Rs3,000 from the peak. Despite this drop, the price remains Rs1,600 below its actual cost today.

    According to the Karachi Sarafa Association, the price of 24-karat gold was reported at Rs215,192 per 10 grams, marking a decline of Rs2,572. In parallel, the price for 22-karat gold also saw a reduction, now standing at Rs197,259 per 10 grams.

    Silver prices also experienced a decline in the domestic market. The cost of 24-karat silver fell to Rs2,850 per tola, down by Rs50, while the price for silver per 10 grams decreased to Rs2,443, a drop of Rs43.

    On the international front, spot gold traded around $2,418 per ounce, down by $26.80 or 1.10 per cent from the previous session. Despite the recent dip, analysts remain optimistic about gold’s medium-term prospects, citing ongoing political uncertainties and anticipated rate cuts as factors that could bolster gold’s appeal.

    Kelvin Wong, senior market analyst for Asia Pacific at OANDA, noted that while profit-taking is currently influencing gold prices, the outlook remains positive.

    Markets are forecasting a 98 per cent probability of a Federal Reserve rate cut in September, according to the CME FedWatch Tool. Non-yielding gold often becomes more attractive in a low-interest rate environment.

  • SBP-held forex reserves surge by $18.6 million to $9.42 billion

    SBP-held forex reserves surge by $18.6 million to $9.42 billion

    The latest figures from the State Bank of Pakistan (SBP) reveal a slight increase in the country’s foreign exchange reserves. During the week ending July 12, 2024, SBP’s reserves grew by $18.6 million, marking a 0.20 per cent rise to reach $9.42 billion.

    In parallel, Pakistan’s overall foreign reserves, including both SBP and commercial banks, increased by $58.8 million, or 0.40 per cent, totaling $14.7 billion.

    Commercial banks in Pakistan also saw a rise in their reserves, which grew by $40.2 million, or 0.77 per cent, reaching $5.28 billion.

    Since the start of the fiscal year, SBP’s reserves have grown by $34.2 million, reflecting a 0.36 per cent increase. Notably, in the current calendar year alone, reserves have surged by $1.2 billion, representing a notable 14.63 per cent rise.

    These developments signify positive momentum in Pakistan’s foreign exchange reserves, contributing to a more stable economic outlook for the nation.

  • Pakistan Railways increases fares for passenger and freight trains

    Pakistan Railways increases fares for passenger and freight trains

    Pakistan Railways has announced an increase in fares for all train services starting Friday, July 19, 2024. This decision, reported by the Associated Press of Pakistan (APP), is part of a broader strategy to rationalise fares.

    According to an official notification issued on Thursday, fares for mail, express, intercity, and passenger trains, including outsourced services, will see a 1 per cent hike. Additionally, freight and goods train fares will be increased by 2 per cent.

    The fare adjustment comes amidst Pakistan Railways’ ongoing efforts to improve its financial health. Over the past six months, the railway department, in collaboration with railway police and train staff, has collected over Rs76 million from passengers traveling without tickets.

    Approximately 59,143 ticket-less passengers were identified during this crackdown, with the recovered amounts duly deposited into the department’s official bank account.

    This move aims to enhance revenue generation and ensure the sustainability of Pakistan Railways’ operations while providing better services to its passengers.

  • Gold price surges to record high of Rs254,000 per tola in Pakistan

    Gold price surges to record high of Rs254,000 per tola in Pakistan

    The price of gold in Pakistan soared to a new record on Thursday, with 24-karat gold increasing by Rs4,600 per tola, reaching an unprecedented Rs254,000. This surge aligns with global market trends influenced by economic indicators in the United States.

    The rise in gold prices is driven by signs of slowing inflation in the US, prompting speculation that the Federal Reserve may soon lower interest rates. Historically, high interest rates tend to negatively impact gold prices as the precious metal does not yield interest, making it less attractive to investors compared to interest-bearing assets.

    Notably, the current gold price in Pakistan is Rs4,000 below its actual market value due to a decrease in purchasing power, reflecting broader economic challenges.

    According to the Karachi Sarafa Association, the price of 24-karat gold per 10 grammes has risen by Rs3,944, now standing at Rs217,764 per tola. Similarly, 22-karat gold is now priced at Rs199,617 per 10 grammes.

    Meanwhile, silver prices have remained stable in the domestic market. The price of 24-karat silver is Rs2,900 per tola and Rs2,486 per 10 grammes.

    Globally, spot gold is trading near $2,468 an ounce, having surpassed the previous all-time high set in May. This global uptrend in gold prices is reflected in the domestic market, influencing local prices accordingly.

    The significant rise in gold prices highlights the ongoing economic uncertainties and the impact of international financial trends on the local market. As investors navigate these fluctuations, the gold market continues to be a barometer of economic sentiment.