Economic and Business Updates - From 23rd to 29th May, 2011

  • The government finalises a consolidated budget of Rs3.854 trillion for the next financial year, envisaging revenue of Rs2.787 trillion, fiscal deficit of Rs912 billion and provincial transfers of Rs1.224 trillion.
  • Non-Performing loans post a phenomenal surge of Rs100 billion to hit an all time high of Rs548 billion by the end of last calendar year, posing new challenges and credit risks to growing banking industry.
  • The Executive Committee of National Economic Council approves 53 projects worth Rs478 billion, with a foreign exchange component of Rs172 billion in socio-economic sectors.
  • The federal budget FY12 will stipulate a three-tier sales tax system of zero, five and 17 per cent, while maintaining higher rates for certain specific industries such as telecom and steel smelters.
  • The Economic Survey 2010-11 prepared by the finance ministry indicates that the economy will grow only by 2.4 per cent during the current year, against the target of 4.5 per cent.
  • The Asian Development Bank will disburse $200 million to Pakistan before the end of the current fiscal year.
  • The Federal Board of Revenue provisionally collects Rs1,257 billion during July-May 2010-11 against downward revised annual target of Rs1,588 billion reflecting a shortfall of Rs331 billion.
  • Foreign investors repatriate $650 million abroad on account of profit and dividend in July-April period of fiscal year compared with $609 million of corresponding period of last year depicting an increase of $41 million.
  • The government is expected to abolish reduced rate of 4-6 per cent sales tax on local supplies made to unregistered persons of five zero-rated sectors for restoration of standard rate of 17 per cent on sales of these sectors from 2011-12.
  • The government is considering a proposal to increase the rate of general sales tax from 17 to 30 per cent for industrial and commercial users of electricity in the next budget to raise additional revenue.
  • Due to upward revision in furnace oil prices, the National Power Regulatory Authority approves Rs1.07 per unit increase in power tariff across the board except for those who consume up to 50 units a month.
  • The Islamabad High Court dismisses the writ petition filed by the Fauji Fertiliser Company Limited against the Competition Commission of Pakistan regarding conditional approval for the acquisition of Agritech.
  • The Board of Investment proposes to set up a new Japan-specific special economic zone in the Sindh Economic Zone offering one million acres of government land with direct access to Port Qasim.


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