ISLAMABAD: Pakistan’s pharmaceutical industry on Thursday threatened to hold a nationwide strike and shut down factories if the government failed to withdraw a 17 percent tax on the import of medicinal raw material in the next five days.
The government imposed the tax in January by introducing a supplementary finance bill, commonly known as mini-budget, while promising that the amount would be refunded to the industry to prevent an increase in drug prices in the local market.
The government also withdrew tax exemptions on numerous items and levied additional taxes of Rs360 billion to meet some major conditions imposed by the International Monetary Fund for the resumption of a $6 billion bailout package.
Industry officials informed the government had reneged on its promise, adding the pharmaceutical industry’s Rs2 billion had yet to be refunded.
“We will be forced to protest in the streets if the government doesn’t withdraw this unjustified tax in the next five days,” Qazi Muhammad Mansoor Dilawar, chairman Pakistan Pharmaceutical Manufacturers Association, said during a news conference in Islamabad along with other top industry office bearers.
He said the industry representatives had recently held three meetings with finance minister Shaukat Tarin before deciding to go public with their grievances since their efforts had gone to a waste.
“The government apparently wants to crush the pharmaceutical industry by only allowing tax refunds after raw material consumption,” Dilawar maintained while adding it would take the industrial players over a year to fully utilize the imported raw material to manufacture medicines.
“We are not willing to accept this and urge the government to either fully withdraw the tax or refund it at the purchase stage,” he said.
He pointed out there was a risk of medicine shortages and price hikes of essential drugs if the government would not accept these demands.
“We cannot increase the price of any medicine on our own,” he clarified, “but the shortage will surely create a black market.”
The pharmaceutical industry is among the most regulated sectors in Pakistan, and only the federal government is authorized to fix the prices of medicines on the recommendation of a drug regulator.
The industry has also been meeting about 80 percent of the local demand of lifesaving drugs. It also contributes to the country’s export revenue and provides jobs to about one million people.
“Our country and people cannot afford medicine imports due to the given economic conditions, so the government should facilitate the pharmaceutical industry instead of imposing unjustified taxes on it,” Dilawar added.
Pakistan’s pharmaceutical industry threatens nationwide strike, seeks abolition of import tax
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Pakistan’s pharmaceutical industry threatens nationwide strike, seeks abolition of import tax
- Government promised in January to refund tax after full consumption of raw material to prevent price hikes in local market
- Industry leaders say will take them more than year to utilize imported raw material while manufacturing medicines
Pakistan increases price of petrol by Rs1.35 per liter till next fortnight
- New price of petrol increases from Rs247.03 per liter to Rs248.38 per liter, says Finance Division
- Petroleum prices revised based on price variation in the international market, says notification international market, says notification
ISLAMABAD: Pakistani authorities have increased the price of petrol by Rs1.35 per liter till the next fortnight, the country’s Finance Division said in a notification late Thursday.
As per the notification, the new price of petrol has been increased from Rs247.03 per liter to Rs248.38 per liter.
“The Oil and Gas Regulatory Authority (OGRA) has worked out the consumer prices of petroleum products, based on the price variation in the international market,” OGRA said in a statement.
Meanwhile, the government also increased the price of high speed diesel by Rs3.85 per liter, increasing it from Rs251.29 per liter to Rs255.14 per liter.
The price of kerosene was slashed by Rs1.48 per liter, decreasing it from Rs163.02 per liter to Rs161.54 per liter, and the price of light diesel oil was slashed by Rs2.61 per liter, bringing it down from Rs150.12 per liter to Rs147.51 per liter.
Pakistan revises petroleum prices every fortnight. Petrol is mostly used in private transport, small vehicles, rickshaws and two-wheelers in Pakistan while any increase in the price of diesel is considered highly inflationary as it is mostly used to power heavy transport vehicles and particularly adds to the prices of vegetables and other eatables.
However, the negligible decrease in petrol and diesel prices is unlikely to provide much relief to the inflation-stricken Pakistanis.
Middle East burger chain Salt to begin operations in Pakistan ‘soon’
- ’Salt’ has branches in Saudi Arabia, Qatar, UK and Hungary already
- Salt did not mention which Pakistani cities it plans on opening outlets in
ISLAMABAD: International fast food chain “Salt” announced on Wednesday that it will expand its operations into Pakistan, vowing to provide its customers in the South Asian country high quality food “soon.”
Salt is a Middle East fast food chain based in Qatar since 2005 that specializes in burgers containing wagyu beef — a type of high-quality beef that comes from the Wagyu cattle breed native to Japan. The company founded by Qatar-based Ali Ahmed Buhindi has been running branches in Qatar, Saudi Arabia, the United Arab Emirates, the United Kingdom and also Hungary.
“Time to pass the salt, Pakistan! SALT, is coming in hot with all the good vibes and flavors to slide right into your cravings,” the burger joint Salt said in a post on Instagram with a picture titled “coming soon.”
Salt did not mention which Pakistani cities it plans on opening its branches in.
The burger chain offers a wide range of beef burgers that include brisket, truffle, signature, hook and original sliders.
Its chicken burgers include Cheetos, pine chicken and crispy chicken sliders flavors.
International fast food restaurants are quite popular in Pakistan with the likes of McDonald’s, KFC and Hardees operating successfully in multiple cities for decades.
Pakistan’s national airline attracts $36 million bid from real estate company
- Sole bidder Blue World City refuses to match government’s minimum price for Pakistan International Airlines
- Pakistan plans to sell over 51 percent of its stake in loss-making PIA as envisaged under an IMF deal this year
ISLAMABAD: Pakistan’s national flag carrier received a Rs10 billion [$36 million] bid from real estate development company Blue World City on Thursday for sixty percent of its stakes during a televised auction, much below the minimum price for the airline set by the government.
Pakistan plans to sell more than 51 percent of its stake in the loss-making Pakistan International Airlines (PIA) as part of economic reforms Islamabad agreed to with the International Monetary Fund (IMF) for a critical 37-month $7 billion bailout deal approved in September.
Pakistan’s government had pre-qualified six groups in June, but only real estate development company Blue World City met a Tuesday deadline to submit final documents to participate in the auction.
The state-owned Pakistan Television (PTV) broadcast the bidding process live, with Blue World City as the sole bidder. The bid for $36 million was read out in front of government officials and financial advisers. The government had set a minimum price of Rs85 billion [$305 million] for the airline.
“We have considered your match price option,” Blue World City Chairman Saad Nazir said during the event. “We have decided to stand with the price we have already submitted.”
Nazir refused to match the government’s offer of Rs85 billion, saying that as per the company’s assessment, “this was the best decision.”
“If the government doesn’t privatize [PIA], we wish the government all the best,” he said.
Pakistan’s privatization commission has allowed some time for potential bidders to see if any would outmatch Blue World City’s bid.
“The government couldn’t get the fair price of the PIA through the auction due to the single bidder,” Haroon Sharif, a former member of the cabinet committee on privatization, told Arab News.
“There was no competition to purchase stakes of the national carrier.”
The government’s initial plan was to finalize the deal to sell PIA on the country’s Independence Day, Aug. 14, but the plan was delayed following requests from bidders waiting for the airline’s latest audited accounts, aircraft lease agreements and clarity on flights to Europe, which are currently banned.
This auction was delayed to September and October but those also did not materialize.
Sharif said the government should have extended the auction’s deadline to involve more bidders in the process.
“Now it looks like the government is privatizing the PIA in desperation,” he noted.
Official data available with Arab News shows there are 88 commercially operated state-owned enterprises in Pakistan, with collective losses of up to Rs730.258 billion ($2.61 billion) in the fiscal year 2022 (FY22).
In its five-year privatization plan ending in 2029, the government has approved 24 state-owned enterprises for sale, including the PIA.
With a fleet of 34 aircraft comprising 17 Airbus A320s, 12 Boeing B777s and 5 ATRs, the PIA loses traffic to Middle Eastern carriers who have a market share of 60 percent, because of an absence of direct flights to destinations.
The carrier has air service pacts with 87 countries, and landing slots at key destinations such as London Heathrow.
The reorganization plan of the business will separate the aviation-related aspects from non-core components, so freeing the operating subsidiary of a large portion of legacy debt.
Pakistan says IMF cut its inflation forecast for the country for this year to 9.5%
- No need for government to introduce mini-year budget, says finance minister
- Aurangzeb says IMF revised down import projections for Pakistan for current fiscal year
ISLAMABAD: The International Monetary Fund has lowered its inflation forecast for Pakistan for the current year by 3.2% points to 9.5%, the country’s finance minister said on Thursday.
The IMF’s revised projection bring it closer to Pakistan’s own projections, Finance Minister Muhammad Aurangzeb said.
He said there was no need to introduce a mid-year budget, responding to local media reports saying the government needed to revise its budget to stay on track with an ongoing $7 billion, 37-month program with the IMF.
Aurangzeb said the IMF also revised down its import projections for Pakistan in the current fiscal year, which ends in June 2025.
Pakistan has been struggling with boom-and-bust economic cycles for decades, leading to 22 IMF bailouts since 1958. Currently the country is the IMF’s fifth-largest debtor, owing the Fund $6.28 billion as of July 11, according to the lender’s data.
The latest economic crisis has been the most prolonged and has seen Pakistan facing its highest-ever inflation rate, pushing the country to the brink of a sovereign default last year before an IMF bailout. Inflation has since eased.
Pakistan flag carrier PIA attracts $36 million bid from real estate company
- Pakistan is looking to offload 51-100 percent stake in debt-ridden airline to raise funds to reform state-owned assets
- Pakistan pre-qualified six groups but only Blue World City company met deadline to submit documents for auction
KARACHI: Pakistan’s state-owned airline PIA has received a 10 billion rupee ($35.99 million) bid from real-estate development company Blue World City, the Privatization Ministry said on Thursday without disclosing the size of the stake.
The cash-strapped country is looking to offload a 51-100 percent stake in debt-ridden Pakistan International Airlines (PIA) to raise funds and reform bleeding state-owned enterprises as envisaged under a $7 billion International Monetary Fund (IMF) program.
The government had pre-qualified six groups in June, but only one — real estate development company Blue World City — met a Tuesday deadline to submit final documents to participate in the process.
Officials from three groups that chose not to bid told Reuters on condition of anonymity that there were concerns about the government’s ability to stand by agreements made for the flag carrier in the long term.
One executive voiced concern about policy continuity once a new government came in. The government of Prime Minister Shehbaz Sharif has relied on a coalition of disparate political parties.
The disposal of PIA is a step former governments have steered away from as it has been highly unpopular given the number of layoffs that would likely result from it.
Underpinning these concerns over policy continuity and honoring contracts was the government’s termination of power purchase contracts with five private companies earlier this month, as well as the process of re-negotiating other sovereign guaranteed pacts.
Changes in Pakistan’s decade-old agreements with private Independent Power Producer (IPP) projects, largely financed by foreign lenders, to address chronic power shortages, “raises the risk of investing as well as doing business in Pakistan, even in the presence of sovereign contracts as well as guarantees,” said Sakib Sherani, an economist who heads private firm Macro Economic Insights.
Other concerns raised by potential bidders included inconsistent government communication, unattractive terms and taxes on the sector, in addition to PIA’s legacy issues and reputation.
($1 = 277.8500 Pakistani rupees)
