July 2020


Recorder Report 25 Jul 2020

KARACHI: Pakistan must have the same level of market access with UK after Brexit which Pakistan is enjoying with EU. This was stated by Sheikh Sultan Rehman, Vice President of the Federation of Pakistan Chamber of Commerce and Industry (FPCCI) in a webinar on “Impact of Brexit on Trade and Economy of Pakistan,” organized by FPCCI via zoom video conference.

Sheikh Sultan stated that there was a historical referendum in UK in 2016, wherein the people of UK voted against remaining in EU which created a wave of shock and caused loss of US$ 2 trillion in a day.

He added that UK plays a key role in economic and social development of Pakistan. At present, the balance of trade between Pakistan and UK is in favor of Pakistan. Pakistan’s exports to UK stood at US$ 1.7 billion and Pakistan is mainly exporting textiles cotton fabrics, knitwear, readymade garments, bed wear and rice to UK.

He stated that currently the trade between Pakistan and UK is going on under EU GSP Plus scheme which will end for UK from January 01, 2021. He also urged Pakistani Government to sign Bilateral Investment Treaty with UK.

In his remarks, TDAP GSP Plus Advisor Kamal Shehryar stated that the negotiation between Pakistan and UK is continuing for getting the similar facility which Pakistan is enjoying under EU GSP Plus. He stated that UK has not shared conditionalities of new trade agreement but in principle agreed for similar level of facilities.

He added that after Brexit the border trade with EU will not take place for moving goods in EU member countries. UK has started revision of its MFN tariff for all countries which will also benefit Pakistan. Aisha Makhdoom Joint Secretary Ministry of Commerce informed about their negotiations regarding post Brexit arrangements with Trade Department of UK and stated that the demand of UK about adoption of conventions are same which Pakistan is already ratified in EU GSP plus.

Zakriya Usman, Former President FPCCI emphasized to finalize the agreement with UK as Pakistani exporters have made huge investment in textile sector in accordance to EU GSP plus requirements which should not be affected with Brexit.

Asim Yousuf, Vice President Pakistan UK Chamber of Commerce and Industry added that there are huge opportunities for Pakistan’s export in agriculture, textile and food items to UK.

In this context, there is a need of early formulation of Pakistan’s trade delegation to UK for getting new orders from UK. Moreover, Pakistani community in UK also plays a crucial role in Pak-UK Trade and at present, 80 percent of our trade with UK is conducted by Pakistani companies.

Sheikh Muhammad Tariq, Chairman Pakistan UK Business Council of FPCCI informed about the registration of his company for filing of custom declaration service from January 2021. After completion of Brexit transition period, additional more than 250 millions custom declaration will be filed and processed.

He also urged Pakistan to comply with standards and SPS measures as UK is importing 1.2 million ton of meat. He also underlined the need of developing Pakistani business center in UK as UK is establishing business hub wherein all the countries are establishing their offices.

Shariq Vohra underscored the need of research for enhancing exports to potentials market as our Pakistan export is stagnant for 10 years. Qaisra Sheikh Coordination Women Entrepreneurs emphasized on the development of mechanism for transformation of informal trade into formal trade as most of the women are exporting to UK informally. She also suggested expanding the list of product mix for enhancement of exports.

The participants also stated that SBP should sign agreement with central bank of England for trading in property of UK on collateral basis as like India has signed. This agreement will also facilitate transfer of remittances from UK to Pakistan. Moreover UK should also follow REX system after BREXIT which is convenient to Pakistani exporters.

The Webinar was attended by Kamal Shehryar, Adviser on GSP Plus Trade Development Authority of Pakistan, Ms. Aisha Makhdoom and Baber Khan Joint Secretary and Deputy Secretary Ministry of Commerce, Asim Yousuf Vice President Pak-UK Chamber of Commerce and Industry, Dr. Zulfiqar Hyder Senior Economist, Syed Ali Raza Media Deputy Director State Bank of Pakistan, Sheikh Muhammad Tariq, Chairman Pak UK Business Council of FPCCI, Zakriya Usman Former President FPCCI, Qaisra Sheikh Coordinator Women Entrepreneurs and Executive Committee and General Body Members of FPCCI.

Copyright Business Recorder, 2020



AFP Updated 21 Jul 2020

WASHINGTON: The US Commerce Department on Monday announced it has blacklisted 11 Chinese businesses for involvement in human rights violations against the Uighur minority, cutting off the firms’ access to American goods.

Washington, together with other western nations and rights groups, has accused Beijing of interning at least a million Muslims from the Uighur ethnic group in the western Xinjiang region.

In a statement, the Commerce Department said the 11 sanctioned companies are “implicated in human rights violations and abuses in the implementation of the People’s Republic of China’s campaign of repression, mass arbitrary detention, forced labor, involuntary collection of biometric data, and genetic analyses.”

Commerce sanctioned nine companies – Changji Esquel Textile, Hefei Bitland Information Technology, Hefei Meiling, Hetian Haolin Hair Accessories, Hetian Taida Apparel, KTK Group, Nanjing Synergy Textiles, Nanchang O-Film Tech and Tanyuan Technology – for involvement in forced labor.

Xinjiang Silk Road and Beijing Liuhe were both sanctioned for “conducting genetic analyses used to further the repression” of Uighurs, Commerce said.

US Secretary of State Mike Pompeo earlier this month called China’s treatment of Uighurs “the stain of the century.” But Beijing denies an wrongdoing, saying Uighurs are attending vocational training centers.



Saleem Shahid 21 Jul 2020

QUETTA: The chief executive of the Balochistan Board of Investment and Trade, Farman Zarkoon, has said that special economic zones (SEZs) in Bostan and Hub will boost industrialisation in the province.

“The federal and provincial governments will establish SEZs under the Special Economic Zones Act, 2012,” he said on Monday.

He said the role of the Board was to act as a mediator between the Special Economic Zones Authority and its operators.

Mr Zarkoon said developers and entrepreneurs would be exempted from duties and taxes on import of all capital goods for the purpose of development, operation and maintenance of SEZs.

“All taxes on the income generated in connection with the development and operation of the economic zone will be exempt from all taxes for 10 years from the start of the Special Economic Zones Development Agreement,” he said.

“The Bostan special economic zone provides investment opportunities in various industries, including fruit processing, agricultural machinery, pharmaceuticals assembly of motorcycles. The Hub SEZ on an area of 400 acres will have chemical, food, cement, pharmaceuticals, energy, oil lubricants, marble, metal processing, mineral grinding and steel grinding plants,” Mr Zarkoon said.

The project would create 143,000 jobs directly and indirectly for the people of Balochistan, he added.

Published in Dawn, July 21st, 2020



The Newspaper’s Correspondent Updated 15 Jul 2020

NEW DELHI: Iran and China have finalised a $400 billion strategic partnership deal, and a significant political casualty is the Chabahar to Zahedan rail project with India, which Iran has called off citing delayed finances, The Hindu reported on Tuesday.

It said Iranian Transport and Urban Development Minister Mohammad Eslami last week inaugurated the track-laying process for the 628km Chabahar-Zahedan line, which will be extended to Zaranj across the border in Afghanistan.

The development comes as China finalises a massive 25-year, $400bn strategic partnership deal with Iran, which, the paper said, could cloud India’s plans.

Officials told The Hindu that the entire project would be completed by March 2022, and that Iranian Railways would proceed without India’s assistance four years after they signed the agreement.

Tehran, Beijing finalise $400bn partnership deal

Iran would instead use approximately $400 million from the Iranian National Development Fund. It was not clear if the unnamed officials were Indian, Iranian or some other.

The Hindu cited “leaked versions” of the 18-page “Comprehensive Plan for Cooperation between Iran and China”, being finalised by officials in Tehran and Beijing. The cooperation will extend from investments in infrastructure, manufacturing and upgrading energy and transport facilities, to refurbishing ports, refineries and other installations, and will commit Iranian oil and gas supplies to China during that period.

The newspaper quoted Iranian officials as denying a report that also suggested Chabahar port would be leased to China. However, according to The Hindu, Iran proposed a tie-up between the Chinese-run port at Gwadar and Chabahar last year, and has offered interests to China in the Bandar-e-Jask port 350km away from Chabahar, as well as in the Chabahar duty free zone.

The railway project, which was being discussed between the Iranian Railways and the state-owned Indian Railways Construction Ltd (IRCON), was meant to be part of India’s commitment to the trilateral agreement between India, Iran and Afghanistan to build an alternative trade route to Afghanistan and Central Asia.

In May 2016, during Prime Minister Narendra Modi’s visit to Tehran to sign the Chabahar agreement with Iranian President Hassan Rouhani and Afghan President Ashraf Ghani, IRCON had signed an MoU with the Iranian rail ministry.

The MoU was to construct the Chabahar-Zahedan railway as “part of transit and transportation corridor in trilateral agreement between India, Iran and Afghanistan”. IRCON had promised to provide all services and financing for the project (around $1.6bn).

However, despite several site visits by IRCON engineers, and preparations by Iranian Railways, India never began the work, ostensibly due to worries that these could attract US sanctions. The US had provided a sanctions waiver for the Chabahar port and the rail line to Zahedan, but it has been difficult to find equipment suppliers and partners due to worries they could be targeted by the US, said officials. India has already “zeroed out” its oil imports from Iran due to the sanctions.

India’s Ministry of External Affairs and IRCON declined to comment on the issue, The Hindu said.

Published in Dawn, July 15th, 2020



July 14, 2020

NEW DELHI: Google said Monday it will invest $10 billion in India over the next five to seven years as it battles rivals like Facebook and Amazon in the vast market of 1.3 billion consumers.

Chief executive Sunder Pichai told a virtual Google in India event that its fund would help “accelerate India’s digital economy” and will include investing in local firms and infrastructure in areas like digital payments, education and health.

“There’s no question we are facing a difficult moment today, in India and around the world. The dual challenges to our health and to our economies have forced us to rethink how we work and how we live,” Pichai said.

“But times of challenge can lead to incredible moments of innovation,” Indian-born Pichai said according to a transcript of his remarks released by the US search engine giant.

Foreign firms have spent tens of billions of dollars in India in recent years as they fight for a piece of the Asian giant’s burgeoning digital economy.

This has included only this year around $16 billion in investments from Facebook, Intel and others in stakes in the digital services unit of Jio, controlled by Asia’s richest man Mukesh Ambani.

Pichai on Monday briefed Prime Minister Narendra Modi on his plans, but a government statement suggested that Modi also expressed concerns about data security and privacy.

Modi “said that tech companies need to put in efforts to bridge the trust deficit,” the statement said.—AFP



AFP 08 Jul 2020

UNITED NATIONS: China signed a global pact Monday to regulate arms sales that has been rejected by the United States, the Asian power’s UN ambassador said.

The Communist Party leadership’s top legislative body voted in late June to join the UN Arms Trade Treaty, designed to control the flow of weapons into conflict zones. The signing demonstrates China’s “resolve and sincerity in maintaining international arms control regime, supporting multilateralism, and forging a community with a shared future for mankind,” Zhang Jun, China’s ambassador to the UN, said in a statement. The statement added that Beijing allows arms exports only to sovereign states and not to non-state actors. China, the second-largest global arms producer, announced June 22 it would join the Arms Trade Treaty, which now has 107 member states. Adopted by the UN in 2013, the treaty requires members to keep records of international transfers of weapons and to prohibit cross-border shipments that could be used in human rights violations.

The arms included range from handguns to missiles to airplanes and warships.

The US Senate never ratified the 2013 Arms Trade Treaty after former president Barack Obama endorsed it, and Trump has said he would revoke his predecessor’s signature.

It is among a number of international agreements reached under the Obama administration that Trump has moved to pull out of.



Updated 02 Jul 2020

ISLAMABAD: Chief Executive Officer of US International Development Finance Corporation (IDFC), Adam Boehler, called on Advisor to the Prime Minister on Commerce and Investment, Abdul Razak Dawood, at Ministry of Commerce on Wednesday.

The meeting was attended by Chairman Board of Investment (BOI) Atif Riaz Bokhari, Secretary Commerce and representatives from BOI, Commerce and Planning Division.

Giving an overview of Pakistan’s economic relationships with the regional countries, Abdul Razak Dawood said Pakistan is already working closely with Afghanistan particularly on the development of transit trade as well as building of long term economic relationships.

Dawood said Pakistan was looking for a stronger connectivity with Central Asian Republics, which would include building of not only roads but also the power infrastructure. The Advisor underlined that Pakistan was a high-cost energy country and, with the stronger connectivity with Central Asian Republics, the country can lower these costs for the benefit of investors and businesses. He further said IDFC could play an instrumental role as interlink among these regional countries for the achievement of mutual objectives.

The Advisor, while discussing different opportunities in Pakistan, apprised the CEO IDFC of Public Private Partnership mode, introduced by the government, in order to relieve some burden of the annual PSDP expenditure. Dawood explained that there was a need of foreign direct investment in Pakistan because it brings along technology, improvement in productivity and employment opportunities for the locals. He assured that Pakistan is looking for diversification in FDI as investors from all over the world, irrespective of their country of origin, are provided the level playing field and equal support from the government. The Advisor also shared the problems being faced by the businessmen in Pakistan, amid a global pandemic, including liquidity issues and cancellation of export orders.

Speaking on specific areas where IDFC can support Pakistan, Chairman BOI talked about Mortgage Lending sector, where a joint venture with Pakistani businesses can be established to provide affordable housing solutions to the public.

Bokhari also talked about development of a Science and Technology Industrial Park in Pakistan as well as investing in small and medium scale Hydro-Power projects.

Talking about the mode of investment, Chairman BOI stressed the importance of equity investment rather than direct loans, which is a more sustainable approach towards development.

CEO IDFC informed the Advisor that they intend to start a regional fund for development in CARs, who have shown keen interest for involving Pakistan in the fund. He added that IDFC has a $3 billion fund for immediate liquidity requirements of financial institutions, in the aftermath of Covid-19 pandemic. He also discussed a number of opportunities discussed by the Pakistani side and decided to pursue different options as discussed in the meeting.-PR

Copyright Business Recorder, 2020